UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB

                   [X] ANNUAL REPORT UNDER SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                   For the fiscal year ended December 31, 2005

                         Commission file number: 0-29751

                           WINMAX TRADING GROUP, INC.
                           --------------------------
        (Exact name of small business issuer as specified in its charter)

                     FLORIDA                              65-0702554
                     -------                              ----------
         State or other jurisdiction of                I.R.S. Employer
         Incorporation or organization                Identification No.

                 11th Floor, 48 Wall Street New York, NY. 10005
             -------------------------------------------------------
                     (Address of principal executive office)

                                 (877) 693-3130
                                 --------------
                 (Issuer's telephone number including area code)

      Securities registered pursuant to Section 12(g) of the Exchange Act:

        Title of each class         Name of each exchange on which registered
           Common Stock                        Pink Sheets LLC

Indicate by check mark whether the issuer is required to file reports pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934. [X] Yes [ ] No

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 preceding 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. [X] Yes [ ] No

Indicate by check mark if no disclosure of delinquent filers pursuant to ITEM
405 of Regulation S-B is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-KSB or any amendment to
this Form 10-KSB. [ ]

Indicate by check mark whether the registrant is a shell company (as defined in
the Rule 12b-2 of the Securities exchange Act of 1934). [ ] Yes [X] No

Our revenues for the year ended December 31, 2005 was $243,235

State the aggregate market value of the voting and non-voting common equity held
by non-affiliates of the registrant computed by reference to the price at which
the common equity was sold, or the average bid and asked price of such common
equity, as of a specified date within 60 days prior to the date of filing. The
aggregate market value of the voting and non-voting common equity held by
non-affiliates as of May 3, 2006 was approximately $2,729,090

(APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE
PRECEDING FIVE YEARS):
   Not Applicable.

(APPLICABLE ONLY TO CORPORATE REGISTRANTS)

Indicate the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date: As of the date of this filing,
the Company had 35,796,662 shares of our $0.001 par value common stock
outstanding.

DOCUMENTS INCORPORATED BY REFERENCE:
   None

Transitional Small Business Disclosure Format (check one): Yes [ ] No [X]

<PAGE>

                                TABLE OF CONTENTS
                          ANNUAL REPORT ON FORM 10-KSB

                          YEAR ENDED DECEMBER 31, 2005


                                     PART I

Item 1.     Description of Business...........................................4
Item 2.     Description of Property..........................................11
Item 3.     Legal Proceedings................................................12
Item 4.     Submission of Matters to a Vote of Security Holders..............12

                                    PART II

Item 5.     Market for Common Equity, Related Stockholder Matters and Small
                Business Issuer Purchases of Equity Securities...............12
Item 6.     Management's Discussion and Analysis or Plan of Operation........18
Item 7.     Consolidated Financial Statements...............................F-1
Item 8.     Changes in and Disagreements With Accountants on Accounting and
            Financial Disclosure.............................................22
Item 8A.    Controls and Procedures..........................................22
Item 8B.    Other Information................................................22

                                    PART III

Item 9.     Directors, Executive Officers, Promoters and Control Persons;
            Compliance With Section 16(a) of the Exchange Act................22
Item 10.    Executive Compensation...........................................24
Item 11.    Security Ownership of Certain Beneficial Owners and Management
            and Related Stockholder matters..................................26
Item 12.    Certain Relationships and Related Transactions...................27
Item 13.    Exhibits.........................................................28
Item 14.    Principal Accountant fees at Services............................29


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                                     PART I


Forward-Looking Statements

The following discussion and analysis of our operations should be read in
conjunction with our financial statement for the year ended December 31, 2005
and notes thereto. This annual report on Form 10-KSB for the year ended December
31, 2005 contains "forward-looking statements", within the meaning of such term
in Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. Such forward-looking statements involve known and unknown
risks, uncertainties and other factors that could cause the actual financial or
operating results of the Company to be materially different from the historical
results or from any future results expressed or implied by such forward-looking
statements. Winmax Trading Group, Inc. is referred to herein as "we," "our" or
"us." The words or phrases "would be", "may allow," "intends to," "may likely,"
"are expected to," "may continue," "is anticipated," "estimate," "project," or
similar expressions are intend to identify "forward-looking statements". Such
statements include those concerning our expected financial performance, our
corporate strategy and operational plans. Actual results could differ materially
from those projected in the forward-looking statements as a result of a number
of risks and uncertainties, including: (a) intense competition in the web
development design, web casting, Internet solutions, e-commerce, and retail
business (b) whether are able to manage our planned growth efficiently,
including whether our management will be able to identify, hire, train, retrain,
motivate, and manage required personnel or that management will be able to
manage and exploit existing and potential market opportunities successfully, and
(c) whether we are able to generate sufficient revenues or obtain financing to
sustain and grow our operations. We are still in the early stage of building and
expanding the company and have not generated sufficient revenues to maintain
day-to-day operations.

Statements made herein are as of the date of the filing of this Form 10-KSB with
the Securities and Exchange Commission and should not be relied upon as of any
subsequent date. Unless otherwise required by applicable law, we do not
undertake, and we specifically disclaim any obligation, to update any
forward-looking statements to reflect occurrence, developments, unanticipated
events or circumstances after the date of such statement.

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<PAGE>

ITEM 1. DESCRIPTION OF BUSINESS

HOW WE ARE ORGANIZED

We were incorporated in the state of Florida on September 26, 1996 to engage in
commodities futures trading. From approximately November 1996 until October
2000, we managed a commodities futures investment fund, the Winmax Alpha Fund
Limited Partnership, and we were the general partner of that fund which was
closed in the year 2000. From October 2000 until May 2001, we had no significant
operations or business plan. In June of 2001, our sole officer and director,
Ralph Pistor, sold 100,000 shares of common stock that he owned and which
represented a majority of our then outstanding common stock, to Gerald Sklar. In
connection with the purchase of the 100,000 shares of common stock by Gerald
Sklar, the following occurred:
      o     Ralph Pistor resigned as our sole officer and director;
      o     Gerald Sklar became our President and Director;
      o     We appointed different management to fill existing vacancies on our
            Board of Directors; and
      o     We adopted a new corporate strategy, which is described below.

In March 2002, we affected a one (1) for twenty (20) reverse stock split.

Our wholly owned subsidiaries are:
      o     Winmax Media, Inc., a Florida Corporation, which provides internet
            and media services to various clients;
      o     The Gemstore of New York , Inc., a New York corporation, which holds
            the lease to the retail store in Manhattan, New York;
      o     The Gemstore.com, Inc., a Florida Corporation, which holds the
            Universal Resource Locator (URL), www.thegemstore.com ;
      o     bnettv, Inc. a New York corporation, which provides video streaming
            services to various clients;
      o     bnettv.com, Inc, an Alberta corporation, which provides video
            streaming services to various clients;
      o     The Gemstore, Inc., an Alberta corporation, which facilitates the
            e-commerce transactions for the Gemstore
      o     Winmax media, Inc., an Alberta corporation, which provides Internet
            and media services to various clients
      o     The Gemstore Group Inc. an Alberta corporation, which provides
            services for our Canadian operations.

BUSINESS OVERVIEW

OUR CORPORATE STRATEGY

Beginning in June 2001, our corporate strategy has been to: (a) establish a web
development, design, web casting, Internet solutions and e-commerce business;
(b) acquire gemstone raw materials and/or minerals and to arrange for the
finishing and marketing of the gemstone material and finished jewelry through
our Internet website at www.thegemstore.com, and (c) advance money to prospect
and possibly produce gemstone material. In 2001, we acquired an inventory of
gemstones and pieces of finished jewelry.

In December 2003 we decided to abandon any interests in or financing of
prospecting possible gemstone material as described in (b) above. In
approximately August 2003, we commenced a strategy of opening Retail
Merchandising Units to finish and market gemstone material and finished jewelry
through our Internet website at www.thegemstore.com. From approximately August
2003 to March 2004, we operated 12 Retail Merchandising Units in the United
States and Canada and 1 in-line retail store in Manhatten, New York as test
markets; however, in 2004 we re-assessed the viability of these locations, and
during 2004 and 2005 we closed all but one Retail Merchandising Unit, which
remains operational.


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In January 2006, we effected the incorporation of Sapphire Media, LLC ("Sapphire
Media") in Florida as our wholly owned subsidiary to provide consulting and
investor relations services to small and medium sized companies. To date,
Sapphire Media has not performed any services.

Our corporate strategy going forward is to further develop our (a) web
development, design, web casting, Internet solutions, e-commerce business and
Wireless Application Protocols, including a Wireless Application Protocol micro
site portal (b) acquire gemstone raw materials and/or minerals and to arrange
for the finishing and marketing of the gemstone material and finished jewelry
through our Internet website at www.thegemstore.com, (c) to increase the number
of our Retail Merchandising Units.

OUR REVENUE SEGMENTS
Our principal revenue segments consist of the following:
      o     Web development, design, web casting, Internet solutions and
            e-commerce; and
      o     Sale of gemstone material and finished jewelry at our Internet
            website, www.thegemstore.com, and through our one Retail
            Merchandising Unit located in Manhattan, New York.

We will attempt to develop an additional possible revenue segment through
Sapphire Media's offering of investor relations services.

OUR PRINCIPAL PRODUCTS/SERVICES/DISTRIBUTION METHODS AND MARKETS

Web Development, Multimedia and Internet Services
Our Web Development, Multimedia and Internet services are accomplished through
our in-house employees or through outside consultants whom we hire on an "as
needed" basis. For the year ended December 31, 2005, approximately 54% of our
revenues were derived from sales in web development, multimedia and Internet
solutions. The remaining 46% was from gem sales.

Our services in this area include:

Winmax Media
Winmax Media, our web development subsidiary, focuses on building multimedia
products that are both elegant and intelligent while meeting customer's needs by
delivering clear branding messages. Winmax Media's web casting unit, Bnettv.com,
is a full service video production streaming company that produces both
client-commissioned and in-house video and multimedia. Winmax Media's services
include: web and graphic design, programming (coldfusion, actionscript,
javascript, php, vb, sql, html, xml, shell script, and various other dynamic
computer languages), production and editing of corporate videos, production of
commercials for the internet, live video streaming, CD production, and corporate
brochures. We have also developed and provide a series of re-usable objects in
Java to provide functionality to small and medium-sized corporate Intranets.
These services include scheduling, contact, project, time sheet, billing, file
sharing, and administrative modules.



                                       5
<PAGE>



Winmax Internet Solutions
Winmax Internet Solutions is our Information Technology subsidiary that manages
data center operations including: Internet web hosting of in-house and client
domains;
      o     Monitoring security and technical operations to ensure maximum
            uptime, custom application development using cold fusion to
            integrate database's (such as SQL) for dynamic web content;
      o     Provision of virtual servers for offsite security; and
      o     Provision of networking and application support to both internal and
            external clients.

In addition, Winmax Internet Solutions provides business-to-business extranet
services. Extranet is a closed system that runs over the Internet that has
password protection to prevent data/information from being viewed by the general
public. Through this subsidiary, we allow our customers to off-load technical
services and maintain worldwide access to their proprietary information so they
may focus on their core business.

Winmax Internet Solutions also develops and maintains accounting and inventory
programs for each of our subsidiaries and divisions.

TheGemstore and the Gemstore.com
Since 2003, we have engaged in the Internet marketing and retailing of
gemstones, jewelry and accessories. During 2003 and 2004, we established 13
RMU's on a test basis for the sale of gemstones, jewelry and accessories;
however, after assessing the viability of these test locations, we closed all
but one Retail Merchandising Unit, which is currently operational in New York,
New York. We will continually assess the viability of opening additional
locations.

Our other gemstone related business operated from August 2002 to present, as
follows:

(i) the development of our website located at www.thegemstore.com through which
we sell our finished jewelry products as well as retail outlets; and,
(ii) our wholly owned subsidiary, Global Gemstone and Jewelry Inc., obtained
gemstone inventory in 2002 and creates our custom-made jewelry in Chang Mai,
Thailand. The finished product is made available through our website, private
parties, and our one Retail Merchandising Unit.

OUR CUSTOMERS
Our multi media services and Internet solutions have a potential for a wide
range of customers, which consist primarily of emerging growth companies. For
the year ended December 31, 2005, approximately 46% of our revenue was derived
from our Retail Merchandising Units and approximately 54% from web development,
multimedia and Internet Solutions sales. Because we operated 12 Retail
Merchandising Units during our fiscal year 2005, and now we have only one, our
revenues will be negatively impacted.

DEPENDENCY UPON ONE OR A FEW CUSTOMERS
For the years ended December 31, 2004 and 2005, approximately 48% and 54% of our
revenues, respectively, were from one client, Immtech Pharmaceuticals, Inc.
These revenues were generated by our web and media division. Should Immtech
Pharmaceuticals no longer require our services, our revenues will be negatively
impacted.

We market and intend to market gemstones to a wide array of consumers through
our website and do not expect to become dependent upon either a single or a few
major customers for this aspect of our business.



                                       6
<PAGE>


OUR BILLING PRACTICES
Web Development and Internet Services
We typically require payment in advance of rendering our website development and
Internet services; however, in some cases we receive payment on completion.

Gemstone Sales
Internet sales are paid in advance by credit card or other pre-payment forms.
All other sales will be paid for in advance. Retail sales are paid by cash,
debit card, or credit card.

GEOGRAPHIC MARKETS
Web Development/Internet Services
Our web development and Internet services are offered in Asia, Europe and
throughout North America, including the United States, and Canada.

Gemstone Services
These services will be offered throughout the world by Internet, through direct
contact with buyers, and through our retail outlet located in New York.

COMPETITIVE BUSINESS CONDITIONS
The web development, media, Internet, and investor relations services and
gemstone business are increasingly competitive with hundreds of competitors on
the Internet alone. In addition, barriers to market entry are relatively low and
new competitors can establish new sites at comparatively low cost and choose
from a variety of market-ready software. As a result, we expect competition to
become increasingly intensified in the future. Competition is rapidly evolving
and very competitive and there are no assurances that we can keep pace with the
intense competition in this market. Our competitors have substantially longer
operating histories, greater name recognition, larger customer bases, and
greater financial and technical resources than us. Accordingly, these companies
are able to conduct extensive marketing campaigns that we are financially unable
to accomplish. In addition, these companies may offer more attractive pricing
and payment terms. There are no assurances we will be able to overcome the
competitive advantages of our competitors.

SUPPLIERS

Web Development/Internet Services
We supply our own services in-house and/or through contract consultants.

Gemstone Sales/Services
We acquire gemstone raw materials, minerals, jewelry and accessories from third
parties

SOURCES AND AVAILABILITY OF RAW MATERIALS
Web Development Internet and Investor Relations Services
We do not use raw materials in this aspect of our business.

Gemstone Business
We use raw materials purchased from a variety of different suppliers located
worldwide, but usually from suppliers located in Africa, Southeast Asia and
Eastern Europe. We do not anticipate any shortage of raw materials.

PATENTS, TRADEMARKS AND LICENSES

We have no patents, trademarks or licenses regarding any aspects of our
business.



                                       7
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REGULATORY MATTERS

Web Development and Internet Services
We are not aware of any governmental regulations pertaining to this aspect of
our business that will have a material impact; however, due to the increasing
popularity and use of the Internet, it is possible that additional laws and
regulations may be adopted with respect to the Internet, covering issues such
as:
- - content
- - privacy
- - access to adult content by minors
- - pricing
- - bulk e-mail
- - encryption standards
- - consumer protection
- - electronic commerce
- - taxation
- - copyright infringement
- - other intellectual property issues

Our gemstone business also involves use of the Internet. We cannot predict the
impact, if any, that future regulatory changes or developments may have on our
business, financial condition, or results of operation. Changes in the
regulatory environment relating to the Internet access industry may increase our
costs or limit our ability to offer our services.

Gemstone Business
Our gemstone related business activities are governed by a variety of
governmental laws and regulations, including import/export and tax laws in
Thailand, Sri Lanka, Vietnam, Poland, United States, Canada and Europe. We are
not aware of any additional legislation or proposed legislation, which would
have a material effect upon our operations.

Investor Relations Services
Because our investor relations services are impacted by Securities and Exchange
Commission regulations, we must adhere to all such applicable laws.

Tax Matters

Our Canadian subsidiaries, The Gemstore, Inc., Winmax Media, Inc., bnettv.com,
Inc. and Winmax Capital Group Inc., have not filed corporate tax returns with
the government of Canada for each year from 2001 to 2005; however, none of these
companies have earned a taxable profit during those years. Corporate tax returns
in this regard are typically filed only when companies earn a taxable profit or
upon a request or demand to file, which we have not received. Our Canadian
subsidiaries have filed the appropriate payroll tax filings for each year from
2001 to 2005. We have made payroll tax payments during these years; however,
certain amounts are under dispute with the Canadian government. Our Canadian
subsidiaries have also filed the appropriate goods and services tax filings;
however, we have requested refunds due to tax payments on goods and services,
which we claim exceed taxes on corporate sales. These refunds also are under
dispute.

Our United States subsidiaries, Winmax Media, Inc., bnettv, Inc., The
Gemstore.com, Inc. and The Gemstore, Inc., have not filed corporate tax returns
with the United States government for each year from 2001 to 2005; however, none
of these companies have earned a taxable profit during those years.
Additionally, state income tax returns in Florida and New York have not been
filed regarding the same subsidiaries; however, no taxable profit was earned in
either jurisdiction. Although we made partial payroll tax payments for the years
2004 and 2005 in the United States, Florida, and New York, we have not made the
appropriate payroll tax filings to date.

Liabilities along with estimated interest and penalties have been recorded on
the accounts of the Company and are reflected in the consolidated financial
statements.

Because we have failed to make certain tax filings and payments as reflected
above, we may be subject to civil fines and forfeitures.


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<PAGE>


COMPLIANCE WITH ENVIRONMENTAL REGULATIONS
No segments of our business involve the emission of pollutants or other
substances under the regulations of the Environmental Protection Agency or any
similar such agency at the state, local or foreign level. Accordingly, we have
no cost affiliated with environmental compliance.

EMPLOYEES

As of December 31, 2005, we had 10 employees, 6 of which are fulltime and 4 part
time. Our full time employees are:
      o     Gerald E. Sklar, our President, who directs our operations;
      o     David M. Young, our Vice President, who is responsible for customer
            relations, Retail Merchandising Unit leases, and insurance;
      o     1 salesperson who conducts retail sales of our gemstone material and
            finished gemstone jewelry; and
      o     3 employees who handle our overall web and information technology
            operations

Our part-time employees consist of:
      o     2 computer and web programmers; and
      o     2 graphic designers.

We continue to have the same employees as of May 22, 2006.

RESEARCH AND DEVELOPMENT
During 2004 and 2005, no funds were expended on research and development
activities.

MATERIAL AGREEMENTS

Investor Relations Agreement with General Research GmgH
We have a June 14, 2005 agreement with General Research GmgH, which is located
in Munchen, Germany. General Research GmgH is identified in the agreement as
"Consultant". The agreement provides that Consultant will conduct an investor
relations program to increase our exposure to European investors, including: (a)
roadshows; (b) investor presentations; (c) media coverage; (d) research reports;
(e) one on one with key banking and investment fund contracts; and (f)
identification of potential investors for any private placement offering of
securities. In return for these services, On June 14, 2005, we issued 100,000
restricted shares of our common stock to a non-related consultant in exchange
for banking service, and media presentations. We valued the shares at $0.50 per
share or an aggregate of $50,000 based on the current market price of the
shares. We relied upon the exemption from registration afforded by Sections 4(2)
and 4(6) of the Securities Act of 1933, as amended ("Securities Act") for the
offer and sale. We believed that Sections 4(2) and 4(6) were applicable because
the offer and sale did not involve a public offering and there was no general
solicitation or general advertising involved in the offer or sale. We placed
restrictive legends on the certificates representing these securities stating
that the securities were not registered under the Securities Act and are subject
to restrictions on their transferability and resale. In addition we granted the
same consultant: (a) a warrant to purchase 100,000 shares of our common stock
with an exercise price of US-$ 1.00 per share to expire June 14 2010; and (b) a
warrant to purchase an additional 100,000 shares of our common stock with an
exercise price of US-$ 1.50 per share to expire June 14 2010.

Consulting Agreement with Samantha Fryer
We have a July 8, 2005 agreement with Samantha Fryer, our President's
Daughter-in-law, in which Samantha Fryer, who is identified in the agreement as
"Consultant", will perform the following duties: (a) represent products to
distributors and retailers throughout North America and other countries
worldwide; (b) provide general business consulting, including development of
products and the building in the retail division; (c) locate quality personnel
to work in our retail division; (d) locate in-line and RMU locations for further
compensation;(d) identify sources for sale and distribution of products to be
sold in our retail division; and (e) such other duties as may be assigned by our
board of directors or president. In return for these services, we agreed to pay
Consultant 500,000 shares of our common stock issued pursuant to our S-8
registration statement; however, on January 3, 2006 that agreement was amended
to provide additional compensation to Ms Fryer of 500,000 shares of our common
stock. On July 8, 2005 we issued 300,000 S-8 shares to Samantha Fryer. Each
share was valued at $0.663 or an aggregate of $198,900. On November 18, 2005, we
issued 100,000 S-8 shares to Samantha Fryer. Each share was valued at $0.33 or
an aggregate of $33,000.00. On December 19, 2005, we issued 100,000 S-8 shares
to Samantha Fryer. Each share was valued at $0.15 or an aggregate of $15,000.00.
The term of the agreement is 2 years. On January 3, 2006, we issued 150,000 S-8
shares to Samantha Fryer. Each share was valued at $0.24 or an aggregate of
$36,000.00.


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Consulting Agreement with MJD Corp
We have a July 8, 2005 agreement with MJD Corp, which is located in Staten
Island, New York, and is identified in the agreement as "Consultant". The
agreement provides that the Consultant will: (a) represent concepts and products
to industry representatives throughout North America and other countries
worldwide; (b) provide representation for us, our products and services,
personnel and various others that may arise from time to time; (c) locate top
quality areas for us to promote our products and image, and to fuel our growth;
(d) identify outsources for distribution and other partners necessary in the
processing and finishing the content proposed; and (e) such other duties as may
be assigned by our board of directors or president. In return for these services
we paid to the Consultant 1,250,000 of our restricted common stock on July 11,
2005. The term of the agreement is 3 years.

Consulting Agreement with Anthony Sklar
We have a July 8, 2005 agreement with Anthony Sklar, our President's son, who is
identified in the agreement as "Consultant". The agreement provides that the
Consultant will: (a) represent our divisions and products to potential clients,
distributors, retailers throughout North America, and other countries worldwide;
(b ) provide general business consulting, including but not limited to
developing products; (c) locate top quality management to help fuel our growth;
(d) identify outsources for distribution, manufacturing and other partners
necessary in the processing and finishing of the our products; (e)provide
retail-merchandising services throughout North America and other countries
worldwide; and (f) such other duties as may be assigned by our Board of
Directors or President. In return for these services we agree to pay Consultant
700,000 shares of our common stock registered on our S-8 Registration Statement.
However, on January 3, 2006 that agreement was amended to provide additional
compensation to Anthony Sklar of 700,000 shares of our common stock. On July 8th
2005 we issued 250,000 S-8 shares to Anthony Sklar. Each share was valued at
$0.663 or an aggregate of $165,750. On September 6, 2005, we issued 50,000 S-8
shares to Anthony Sklar. Each share was valued at $0.65 or an aggregate of
$32,500.00. On October 18, 2005, we issued 50,000 S-8 shares to Anthony Sklar.
Each share was valued at $0.49 or an aggregate of $24,500.00. On November 18,
2005, we issued 150,000 S-8 shares to Anthony Sklar. Each share was valued at
$0.33 or an aggregate of $49,500.00. On December 19, 2005, we issued 150,000 S-8
shares to Anthony Sklar. Each share was valued at $0.15 or an aggregate of
$22,500.00. The term of the agreement is 3 years. On January 3, 2006, we issued
150,000 S-8 shares to Anthony Sklar. Each share was valued at $0.24 or an
aggregate of $36,000.00. On March 3, 2006, we issued 100,000 S-8 shares to
Anthony Sklar. Each share was valued at $0.21 or an aggregate of $21,000.00.

Consulting Agreement with Gioacchino Bonsangue
We have a July 8, 2005 agreement Gioacchino Bonsangue, who is located in Staten
Island, New York, and is identified in the agreement as "Consultant". The
agreement provides that the Consultant will: (a) represent concepts and products
to industry representatives throughout North America and other countries
worldwide; (b) provide representation for us, our products and services,
personnel and various others that may arise from time to time; (c) locate top
quality areas for us to promote our products and image, and to fuel our growth;
(d) identify outsources for distribution and other partners necessary in the
processing and finishing the content proposed; and (e) such other duties as may
be assigned by our board of directors or president. In return for these services
we paid to the Consultant 1,250,000 of our restricted common stock on July 11,
2005. The term of the agreement is 3 years.

Integrated Reports To Security Holders
We are subject to the informational requirements of the Securities Exchange Act
of 1934. Accordingly, we file annual, quarterly and other reports and
information with the Securities and Exchange Commission. You may read and copy
these reports in Washington, D.C. Our filings are also available to the public
from commercial document retrieval services and the Internet world wide website
maintained by the Securities and Exchange Commission at www.sec.gov.


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ITEM 2. DESCRIPTION OF PROPERTY

During the year ended December 31, 2005, we leased office space at the following
locations:

48 WALL STREET, SUITE 1100, NEW YORK, NEW YORK 10005
We currently operate out of approximately 200 square feet at this location. Our
phone number at this location is (212) 918-4513. Our lease commenced on March 1,
2003 and expires in February 2007 with an unaffiliated landlord. Our monthly
rent is $1366.

5920 MACLEOD TRAIL, SUITE 800, CALGARY, ALBERTA CANADA, T2H 0K2
As of December 31, 2005, we operated out of approximately 6700 square feet at
this location. Our telephone number at this location is (877) 693-3130. Our
lease commenced on September 1, 2001 and ended April 30, 2006 with an
unaffiliated landlord. The monthly lease payment increased to Cdn$13,468.75.

770, 2710 - 17 AVE SE CALGARY, ALBERTA CANADA T2A 0P6
As of May 1, 2006 we entered new premises of approximately 2500 square feet
located at 770, 2710 - 17 Avenue S.E., Alberta, Canada. Our telephone number at
this location is (877) 693-3130. Our lease is with an unaffiliated landlord,
providing for a monthly lease with a monthly rental payment of CDN$800.00 plus
operating expenses. This is a month-to-month lease and has no penalty upon
cancellation.

436 WEST BROADWAY NEW YORK, NY 10012 - RETAIL OUTLET
Since September 2004, we have leased our retail outlet at this location. As of
the date of this filing our monthly lease payment is $9250. Beginning August 1,
2006 this payment will increase to $10,250 per month; and commencing February 1,
2007 this payment will increase to $10,500.00 per month, until the expiration of
the lease agreement on July 31, 2007.

As to the 12 Retail Merchandising Units that we closed during 2004 and 2005 (as
discussed under "Business Overview" above), we leased space at these locations
on a month-to-month basis. These month-to-month leases had no penalty for
cancellation of the lease.

Real Property
We do not own any real property nor do we intend to own real property in the
near future. We do not intend to renovate, improve or develop real properties.
We are not subject to any competitive conditions for real property and currently
have no property to insure. We have no policy with respect to investment in real
estate or interests in real estate, and no policy with respect to investments in
real estate mortgages. Further, we have no policy with respect to investments in
securities of, or interests in, persons primarily engaged in real estate
activities.


                                       11
<PAGE>


ITEM 3. LEGAL PROCEEDINGS

We have no other material litigations pending or other legal matters.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

There were no matters submitted to a vote of our security holders in 2005.

PART II

ITEM 5. MARKET FOR COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND SMALL BUSINESS
ISSUER PURCHASES OF EQUITY SECURITIES

Our Common Stock was quoted in the OTC Bulletin Board under the symbol "WMTG"
until May 25, 2006. Since May 25, 2006 our common stock has been quoted on the
"Pink Sheets". The high and low information for each quarter of the two most
recent fiscal years is presented below. The quotations are inter-dealer prices
without adjustment for retail markups, markdowns or commissions and do not
necessarily represent actual transactions. These prices may not necessarily be
indicative of any reliable market value. On May 3, 2006 the last reported sale
price of our Common Stock on the OTC was $0.14 per share.

The following table summarizes the low and high prices for our Common Stock for
each reporting quarter for the fiscal years ended December 31, 2004 and 2005.

                     QUARTER                    HIGH         LOW
                     --------------------------------------------
                     2004 First Quarter        $0.85       $0.31
                     2004 Second Quarter       $0.79       $0.28
                     2004 Third Quarter        $1.20       $0.50
                     2004 Fourth Quarter       $1.06       $0.61
                     --------------------------------------------
                     2005 First Quarter        $0.96       $0.64
                     2005 Second Quarter       $0.85       $0.64
                     2005 Third Quarter        $1.06       $0.42
                     2005 Fourth Quarter       $0.57       $0.14



                                       12
<PAGE>


PENNY STOCK CONSIDERATIONS

Our shares of common stock are "penny stocks" as that term is generally defined
in the Securities Exchange Act of 1934 as equity securities with a price of less
than $5.00. Our shares are subject to rules that impose sales practice and
disclosure requirements on broker-dealers who engage in certain transactions
involving a penny stock.

Under the penny stock regulations, a broker-dealer selling a penny stock to
anyone other than an established customer or "accredited investor" must make a
special suitability determination regarding the purchaser and must receive the
purchaser's written consent to the transaction prior to the sale, unless the
broker-dealer is otherwise exempt. Generally, an individual with a net worth in
excess of $1,000,000 or annual income exceeding $200,000 individually or
$300,000 together with his or her spouse is considered an accredited investor.

In addition, under the penny stock regulations the broker-dealer is required to:

o     Deliver, prior to any transaction involving a penny stock, a disclosure
      schedule prepared by the Securities and Exchange Commission relating to
      the penny stock market, unless the broker-dealer or the transaction is
      otherwise exempt;

o     Disclose commission payable to the broker-dealer and its registered
      representatives and current bid and offer quotations for the securities;

o     Send monthly statements disclosing recent price information pertaining to
      the penny stock held in a customer's account, the account's value and
      information regarding the limited market in penny stocks; and

o     Make a special written determination that the penny stock is a suitable
      investment for the purchaser and receive the purchaser's written agreement
      to the transaction, prior to conducting any penny stock transaction in the
      customer's account.

Because of these regulations, broker-dealers may encounter difficulties in their
attempt to sell shares of our common stock, which may affect the ability of
shareholders to sell their shares in the secondary market and have the effect of
reducing the level of trading activity in the secondary market. These additional
sales practice and disclosure requirements could impede the sale of our
securities. In addition, the liquidity for our securities may be adversely
affected, with a corresponding decrease in the price of our securities. Our
shares are subject to such penny stock rules and our shareholders will, in all
likelihood, find it difficult to sell their securities.

HOLDERS

As of December 31, 2005, based upon records obtained from our transfer agent, we
had 70 holders of record. The number of shareholders does not include an
indeterminate number of shareholders whose shares are held by brokers in "street
name." We currently have one class of common stock outstanding.


                                       13
<PAGE>


DIVIDENDS

We have not declared any cash dividends on our common stock since our inception
and do not anticipate paying any dividends in the foreseeable future. We plan to
retain any future earnings for use in our business operations. Any decisions as
to future payment of dividends will depend on our earnings and financial
position and such other factors as the Board of Directors deems relevant.

On or about January 17, 2006, we amended our Articles of Incorporation to set
forth the preferences, limitations, rights and terms of our Series A Redeemable
Convertible Preferred Stock ("Series A Preferred").

The Articles of Amendment to our Articles of Incorporation set forth the
following preferences, limitations, rights, and terms:

Preferences

The Series A Preferred will have priority over all of our other stock previously
issued as to rights of payment and distribution, including priority as to
dividend or upon liquidation.

Dividends

Series A Preferred stockholders will be entitled to receive annually on the date
of conversion on January 7th of each year (beginning in the year 2007) until
such Series A Preferred is either converted or redeemed, dividends at the rate
of 6% per annum of $70,000. All dividends declared upon the Series A Preferred
will be declared pro rata per share. At our option, a dividend may be paid in
cash or restricted shares of our common stock. If dividends are paid in our
common stock, its value will be determined based on the "20-day volume-weighted
average" of the bid price of our common stock.

Redemption

The Series A Preferred will be redeemed at our option for the purchase price of
$70,000 of each Unit plus any accrued and unpaid dividends, upon 30 days prior
written notice at any time six months after the Securities and Exchange
Commission declares effective the Registration Statement regarding the Series A
Preferred and the common stock underlying such Preferred Shares. We may only
effect such redemption if from the date of the Notice of Redemption through the
Redemption Date: (i) we have duly honored all conversions and redemptions, if
any, scheduled to occur or occurring prior to the Redemption Date, and (ii) the
Registration Statement is currently effective for the resale by the Holder of
the common shares registered and not subject to any stop order suspending its
effectiveness.

Voting

Each issued and outstanding share of the Series A Preferred will be entitled to
vote the number of shares each could vote if the shares were fully converted at
each stockholders meeting regarding any and all matters presented to our
stockholders for their action or consideration (subject to adjustment whenever
there shall occur a stock split, stock dividend, combination, recapitalization,
reclassification or other similar event involving a change in the Series A
Preferred). Except as provided by law or by the provisions establishing any
other series of preferred stock, Series A Preferred Stockholders and holders of
any other outstanding preferred stock, shall vote together with the Common Stock
holders as a single class. We will not amend, alter or repeal the preferences,
special rights or other powers of the Series A Preferred so as to adversely
affect that class of stock, without the written consent or affirmative vote of
the holders of at least a majority of the then outstanding aggregate number of
shares of such affected Series A Preferred Stock.


                                       14
<PAGE>

Conversion

The number of shares of Common Stock a holder of Series A Preferred will be
entitled to receive upon conversion will be determined by multiplying the
Conversion Rate (as defined in the Certificate of Amendment) by the number of
shares of Series A Preferred being converted at any time.

Mandatory Conversion

We may, at any time after January 1, 2006, require that any or all outstanding
Series A Preferred be converted into Common Stock if the Common Stock into which
the Series A Preferred is convertible is registered pursuant to an effective
registration statement under the Securities Act of 1933, as amended, by delivery
to the Series A Preferred Stockholders, for each share of Series A Preferred
converted, the number of shares of Common Stock determined by multiplying the
Conversion rate by the number of Series A Preferred shares held. In order to
exercise a mandatory conversion, we must provide all Series A Preferred
Stockholders notice of the conversion at least 30 days prior to the Conversion
Date, such notice to include the number of shares to be converted and
instructions for surrender of the certificate or certificates representing the
Series A Preferred Stock.

SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLAN

Equity Compensation Plan Information

On July 7, 2005, our Board of Directors approved the Employee/Consultant 2005
Non-Qualified Stock Award and Option Plan (the "Plan"). The purpose of the Plan
is to further our growth by allowing us to compensate employees and consultants
who have provided bona fide services to us through the award of our common
stock. The maximum number of shares of common stock that may be issued under the
Plan is 3,500,000 as Stock award and 3,000,000 as stock option.


                                       15
<PAGE>

Our Board of Directors is responsible for the administration of the Plan and has
full authority to grant awards under the Plan. Awards may take the form of stock
grants, options or warrants to purchase common stock. Our Board of Directors has
the authority to determine; (a) the employees and consultants that will receive
awards under the Plan, (b) the number of shares, options or warrants to be
granted to each employee or consultant, (c) the exercise price, term and vesting
periods, if any, in connection with an option grant, and (d) the purchase price
and vesting period, if any, in connection with the granting of a warrant to
purchase shares of our common stock.

On July 8, 2005, we filed a Registration Statement on Form S-8 with the
Securities and Exchange Commission that covered the issuance of up to 6,500,000
shares of common stock under the Plan. As of December 31, 2005, we had issued a
total of 3,358,000 shares under the Plan. These shares were issued to various
employees and consultants for services rendered during 2005. As of the date of
this filing we issued an additional 2,915,000 shares to various employees and
consultants for services rendered.

The following table summarizes our 2005 Non-Qualified Stock Award and Option
Plan information as of December 31, 2005.

<TABLE>
<CAPTION>
Number of                              Number of                                       Weighted                     Number of
Securities                             Securities                                      average                      securities
Available Under the                    issued upon                                     exercise                     remaining
Stock Award and Option                 exercise of Stock                               price                        Available
Plan                                   Award and Option                                -----                        For future
----                                   Plan                                                                         Issuance
                                       ----                                                                         --------
<S>                                    <C>                                             <C>                          <C>

6,500,000                              3,358,000                                        .5136                       3,142,000
=========                              =========                                       ======                       =========
</TABLE>


The following table summarizes our 2005 Non-Qualified Stock Award and Option
Plan information as of May 22, 2006.

<TABLE>
<CAPTION>

Number of                              Number of                                       Weighted                     Number of
Securities                             Securities                                      average                      securities
Available Under the                    issued upon                                     exercise                     remaining
Stock Award and Option                 exercise of Stock                               Price                        Available
Plan                                   Award and Option                                -----                        For future
----                                   Plan                                                                         Issuance
                                       ---------                                                                    --------
<S>                                    <C>                                             <C>                          <C>
6,500,000                              6,273,000                                        .3941                       227,000
=========                              =========                                       ======                       =======

</TABLE>


                                       16
<PAGE>

ISSUANCE OF UNREGISTERED SECURITIES

On June 14, 2005, we issued 100,000 restricted shares of our common stock to a
non-related consultant in exchange for banking service, and media presentations.
We valued the shares at $0.50 per share or an aggregate of $50,000. We relied
upon the exemption from registration afforded by Sections 4(2) and 4(6) of the
Securities Act of 1933, as amended ("Securities Act") for the offer and sale. We
believed that Sections 4(2) and 4(6) were available because the offer and sale
did not involve a public offering and there was no general solicitation or
general advertising involved in the offer or sale. We placed restrictive legends
on the certificates representing these securities stating that the securities
were not registered under the Securities Act and are subject to restrictions on
their transferability and resale. In addition we granted the same consultant:
(a) a warrant to purchase 100,000 shares of our common stock with an exercise
price of US-$ 1.00 per share to expire June 14 2010; and (b) a warrant to
purchase 100,000 shares of our common stock with an exercise price of US-$ 1.50
per share to expire June 14 2010.

On June 29, 2005, we issued 100,000 restricted shares of our common stock to a
non-related consultant in exchange for promotional services. The shares were
valued at $0.40 per share or an aggregate of $40,000. We relied upon the
exemption from registration afforded by Sections 4(2) and 4(6) of the Securities
Act for the offer and sale. We believed that Sections 4(2) and 4(6) were
available because the offer and sale did not involve a public offering and there
was no general solicitation or general advertising involved in the offer or
sale. We placed restrictive legends on the certificates representing these
securities issued, stating that the securities were not registered under the
Securities Act and are subject to restrictions on their transferability and
resale.

On June 29, 2005, we issued 1,000,000 restricted shares of our common stock to a
director, David Young, in exchange for corporate services related to
Thegemstore, and thegemstore.com. The shares were valued at $0.40 per share or
an aggregate of $400,000. We relied upon the exemption from registration
afforded by Sections 4(2) and 4(6) of the Securities Act for the offer and sale.
We believed that Sections 4(2) and 4(6) were available because the offer and
sale did not involve a public offering and there was no general solicitation or
general advertising involved in the offer or sale. We placed restrictive legends
on the certificates representing these securities issued, stating that the
securities were not registered under the Securities Act and are subject to
restrictions on their transferability and resale.

On July 11, 2005, we issued 2,500,000 restricted shares of our common stock to
two non-related consultants in exchange for National TV and radio and other
media related services. The shares were valued at $1.06 per share or an
aggregate of $2,650,000. We relied upon the exemption from registration afforded
by Sections 4(2) and 4(6) of the Securities Act for the offer and sale. We
believed that Sections 4(2) and 4(6) were available because the offer and sale
did not involve a public offering and there was no general solicitation or
general advertising involved in the offer or sale. We placed restrictive legends
on the certificates representing these securities, stating that the securities
were not registered under the Securities Act and are subject to restrictions on
their transferability and resale.

On September 19, 2005 we issued 75,000 shares of our common stock to two
non-related consultants in exchange for promotional related services. The shares
were valued at $0.75 per share or an aggregate of $56,250. We relied upon the
exemption from registration afforded by Sections 4(2) and 4(6) of the Securities
Act for the offer and sale. We believed that Sections 4(2) and 4(6) were
available because the offer and sale did not involve a public offering and there
was no general solicitation or general advertising involved in the offer or
sale. We placed restrictive legends on the certificates representing these
securities issued, stating that the securities were not registered under the
Securities Act and are subject to restrictions on their transferability and
resale.


                                       17
<PAGE>

On October 26, 2005 we issued 50,000 shares of our common stock to a non-related
consultant in exchange for promotional services. The shares were valued at $0.39
per share or an aggregate of $19,500. We relied upon the exemption from
registration afforded by Sections 4(2) and 4(6) of the Securities Act for the
offer and sale. We believed that Sections 4(2) and 4(6) were available because
the offer and sale did not involve a public offering and there was no general
solicitation or general advertising involved in the offer or sale. We placed
restrictive legends on the certificates representing these securities issued,
stating that the securities were not registered under the Securities Act and are
subject to restrictions on their transferability and resale.

On November 29, 2005, we issued 300,000 shares of our common stock to a
non-related consultant in exchange for real estate services. The shares were
valued at $0.38 per share or an aggregate of $114,000. We relied upon the
exemption from registration afforded by Sections 4(2) and 4(6) of the Securities
Act for the offer and sale. We believed that Sections 4(2) and 4(6) were
available because the offer and sale did not involve a public offering and there
was no general solicitation or general advertising involved in the offer or
sale. We placed restrictive legends on the certificates representing these
securities issued, stating that the securities were not registered under the
Securities Act and are subject to restrictions on their transferability and
resale.


ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS

Forward-Looking Statements

The following discussion and analysis of our operations should be read in
conjunction with our financial statement for the year ending December 31, 2005
and notes thereto. This annual report on Form 10-KSB for the year ending
December 31, 2005 contains "forward-looking statements", within the meaning of
such term in Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. Such forward-looking statements involve known
and unknown risks, uncertainties and other factors that could cause the actual
financial or operating results of the Company to be materially different from
the historical results or from any future results expressed or implied by such
forward-looking statements. Winmax Trading Group, Inc. is referred to herein as
"we," "our" or "us." The words or phrases "would be", "may allow," "intends to,"
"may likely," "are expected to," "may continue," "is anticipated," "estimate,"
"project," or similar expressions are intend to identify "forward-looking
statements". Such statements include those concerning our expected financial
performance, our corporate strategy and operational plans. Actual results could
differ materially from those projected in the forward-looking statements as a
result of a number of risks and uncertainties, including: (a) intense
competition in the web development design, web casting, Internet solutions,
e-commerce, and retail business (b) whether we are able to manage our planned
growth efficiently, including whether our management will be able to identify,
hire, train, retrain, motivate, and manage required personnel or that management
will be able to manage and exploit existing and potential market opportunities
successfully, and (c) whether we are able to generate sufficient revenues or
obtain financing to sustain and grow our operations. We are still in the early
stage of building and expanding the company and have not generated sufficient
revenues to maintain day-to-day operations.

Statements made herein are as of the date of the filing of this Form 10-KSB with
the Securities and Exchange Commission and should not be relied upon as of any
subsequent date. Unless otherwise required by applicable law, we do not
undertake, and we specifically disclaim any obligation, to update any
forward-looking statements to reflect occurrence, developments, unanticipated
events or circumstances after the date of such statement.


                                       18
<PAGE>

OVERVIEW OF OPERATIONS

Our management continues to develop its web development and Internet related
services through Winmax Media and Winmax Internet Solutions. In 2005, our media
and Information Technology Division generated revenues through website design,
corporate video productions and IT support, which represented 54% of our
revenues. We expect our media and Information Technology Division to continue to
represent the significant portion of our revenue.

In 2003, we began retail operations in the gemstone jewelry business opening
three test Retail Merchant Units. In 2004, we continued to expand our test
locations and opened 10 additional units; however, in December 2004, we
re-assessed the viability of our Retail Merchant Units selling gemstone,
jewelry, minerals and accessories. Ultimately, we decided to close all but one
location in 2005, which is located in Manhatten New York.

We continue our retailing of gemstone, jewelry, minerals and accessories.

We have continued to rely on our Chief Executive Officer/major shareholder for
capital to finance our operations. We remain heavily dependant upon our ability
to receive financing. Our future operations are dependent upon continued
financing from our Chief Executive Officer/major shareholder, obtain additional
financing, and generate increased revenues. Should we fail to obtain financing
through these means, we will be unable to continue our operations.

In 2006, we plan to raise additional funding from debt and equity transactions.
Should we receive adequate funding, we intend to further develop and bring to
market a new Internet web based and WAP (wireless application protocol)
microsite based portal. The portal is being developed to capture advertising and
subscription revenue by providing end users a multiple access portal to manage,
distribute and allow friends and associates access to emails, pictures and video
files. The portal is strategically positioned to fill a gap in current online
communities and the technology available to share video files from mobile
devices. We also plan to acquire additional point of sale outlets for
TheGemstore's in our attempt to increase sales. Additionally, assuming adequate
funding, we plan to implement certain cost management practices and to increase
our focus on business development . Our management has agreed to fund us for an
additional two years.

SUBSEQUENT EVENTS

In accordance with a special meeting of our Board of Directors held on March 17,
2006, our Board of Directors unanimously approved the appointment of Chen Zai
Kun to serve as a member of our Board of Directors for a term of one year or
until his successor has been elected and qualified, or until his resignation or
removal. Mr. Chen Zai Kun provided us with written acceptance of the appointment
contemporaneous with our Board of Directors' appointment of him to the board.

RISKS AND UNCERTAINTIES

During the 12 months ended December 31, 2005 and December 31, 2004, we incurred
net losses of $6,941,109 and $3,608,391 respectively. We expect to continue to
generate losses until our revenues increase. For these same periods, we had
total revenues of $243,235 and $355,820, and operating expenses of $7,050,129
and $3,964,211 respectively. There is no assurance we can increase our revenue
sources and it is unlikely that we can lower our expenses in our present mode of
operations. Approximately 54% of our 2005 revenue was from one client, Immtech
Pharmaceuticals, Inc. There is no guarantee that Immtech Pharmaceuticals, Inc.
will continue as a client. We may never earn a profit. If we continue to lose
money over a protracted period of time we may be forced to discontinue our
operations.


                                       19
<PAGE>

For the 12 months ended December 31, 2005 we financed portions of our operations
from $243,235 in revenue and $1,039,891 from our Chief Executive Officer/major
shareholder, in the form of a shareholders loan. On July 8, 2005 our Chief
Executive Officer/majority shareholder forgave debt for a total value of
$256,750 leaving an ending balance due to shareholder of $1,833,519. The
forgiveness of debt of $256,750 has been reflected as additional paid-in
capital.

As of December 31, 2005, we have only $882 of cash, which is insufficient to
meet our operational goals and business plan. We have required, and will
continue to require, substantial capital to fund our business operations.

We have no commitments, agreements or understandings regarding additional
financing and we may be unable to obtain additional financing either on
satisfactory terms or at all. We expect to pursue additional financing through
debt or equity financing. If additional funds are raised or acquisitions are
made by issuing our equity securities there may be dilution to the equity
securities of our existing shareholders. We may also incur debt or assume
substantial indebtedness. Accordingly, the inability to obtain such financing
could have a material adverse effect on our business, financial condition and
results of operations. However, as noted above our management has agreed to
provide us with the necessary funding for the next two years of operations.

MATERIAL CHANGES IN RESULTS OF OPERATIONS

The year ended December 31, 2005 compared with the year ended December 31, 2004

In 2003 we started to implement our business plan to market gemstone, jewelry,
minerals and accessories through retail merchandising units (RMUs). In 2004 and
2005, management re-assessed our RMU's and reorganized our locations by closing
all but one RMU. As of May 3, 2006 there is still only one RMU. For 2006, we
will focus on identifying and opening new locations.

REVENUES

Revenues for the 12 months ended December 31, 2005 decreased to $243,235 from
$355,820 for the same period in 2004. Our media division accounted for 54% of
revenue in 2005 and our retail operations accounted for the remaining 46%.
Revenue from our media division mainly came from one client, Immtech
International in 2005, of which they were our primary revenue source for 2004.
The decrease in revenue from our media division and closing of our RMU's in 2004
and 2005 is the main cause in the decrease in our 2005 revenue.

COST OF SALES

Cost of sales consists in primarily of direct cost related to sales. Cost of
sales decreased to $22,265 from $51,422 for the same period in 2004. The
decrease in cost of sales is attributable to Winmax's decrease in retail sales.


                                       20
<PAGE>

GENERAL AND ADMINISTRATIVE EXPENSES

General and administrative expenses decreased to $1,973,475 for the year ended
December 31, 2005 from $3,014,289 for the year ended December 31, 2004. This
decrease is primarily attributable to an increase in non-cash stock compensation
and closure of certain RMU's.

Non-cash stock compensation to employees and consultants increased from $898,500
in 2004 to $5,054,389 in 2005.

NET LOSS

For the year ended December 31, 2005 and December 31, 2004 net loss was
$6,941,109 and $3,608,391 respectively. The increase in net loss is primarily
attributable to the increase in non-cash stock compensation, which was partially
offset by the decrease in general and administrative expenses.

LOSS PER SHARE

The loss per share for the year ended December 31, 2005 was $(0.28) compared
with the loss per share of $(0.22) for the year ended December 31, 2004.

LIQUIDITY AND CAPITAL RESOURCES AT DECEMBER 31, 2005

Net cash used in our investing, financing and operating activities for the year
ended December 31, 2005 generated positive cash flows of $882 compared to the
negative cash flows of $4,820 used by all activities for the same period in
2004. In 2005, cash flow used in operations was ($1,057,571), cash flow used in
Investments was ($27,433), cash flow from financing was $1,209,513 and the
effects of exchange rate changes on cash was ($123,627) compared with
$(2,316,532), ($175,444), $2,859,809 and ($372,653), respectively, in the year
ended 2004. The loss on exchange rates is due to the weakening in the U.S.
dollar compared to the Canadian dollar. Personnel at our head Gemstore office
and the majority of our full-time employees work in Canada and are paid in
Canadian dollars. The majority of our sales are paid in U.S. dollars.

CASH AT DECEMBER 31, 2005 WAS $882 COMPARED TO $0 ON DECEMBER 31, 2004

We have experienced significant losses from our operations in both 2005 and
2004. For the year ended December 31, 2005 we incurred a net loss of $6,941,109
compared to the net loss of $3,608,391 in 2004. In addition, at December 31,
2005 we had an accumulated deficit of $22,947,042 and stockholders' deficit of
$2,895,335. Our ability to turn a profit is contingent upon, but not exclusive
to, our ability to expand our Winmax Media and The Gemstore subsidiaries and to
secure additional financing to fund said expansion. Although we are pursuing
financing to expand our operations there are no assurances we will be successful
in obtaining such financing. Our failure to secure financing will limit our
growth and profit potential as well as our ability to stay in business.


                                       21
<PAGE>

ITEM 7. Financial Statements

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
CONSOLIDATED FINANCIAL STATEMENTS
<S>                                                                                <C>
Report of Independent Registered Public Accounting Firm (2005)                      F-2
Report of Independent Registered Public Accounting Firm (2004)                      F-3
Consolidated Balance Sheet as of December 31, 2005                                  F-4
Consolidated Statements of Operations and Comprehensive Loss
                   For the Years Ended December 31, 2005 and December 31, 2004      F-5
Consolidated Statements of Stockholders' Deficiency
                   For the Years Ended December 31, 2005 and December 31, 2004      F-6
Consolidated Statements of Cash Flows
                   For the Years Ended December 31, 2005 and December 31, 2004      F-7
Notes to Consolidated Financial Statements                                          F-8 to F-22
</TABLE>

                                       F-1

<PAGE>

             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


To the Board of Directors and Stockholders; Winmax Trading Group, Inc.:

We have audited the accompanying consolidated balance sheet of Winmax Trading
Group, Inc. and Subsidiaries ("the Company") as of December 31, 2005 and the
related consolidated statements of operations and comprehensive loss,
stockholders' deficiency and cash flows for the year then ended. These
consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audit.

We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the
consolidated financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the consolidated financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall consolidated financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Winmax Trading
Group, Inc. and Subsidiaries as of December 31, 2005 and the results of their
operations and comprehensive loss, and their cash flows for the year then ended
in conformity with United States generally accepted accounting principles.

The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 1 to the
consolidated financial statements, the Company has experienced substantial
losses and sustained net operating cash outflows from continuing operations and
anticipates that such conditions will continue into fiscal year 2006. These
conditions raise substantial doubt about the Company's ability to continue as a
going concern. Management's plans regarding those matters are also described in
Note 1. The consolidated financial statements do not include any adjustments
that might result from the outcome of this uncertainty.

/S/ ROSEN SEYMOUR SHAPSS MARTIN & COMPANY LLP

CERTIFIED PUBLIC ACCOUNTANTS


New York, New York
May 19, 2006

                                       F-2
<PAGE>

             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


To the Board of Directors and Stockholders
Winmax Trading Group, Inc.:

We have audited the consolidated statements of operations and comprehensive
loss, stockholders deficiency, and cash flows of Winmax Trading Group, Inc. and
Subsidiaries (the "Company") for the year ended December 31, 2004. These
consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audit.

We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the
consolidated financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the consolidated financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements of the company referred to
above, present fairly, in all material respects, the results of operations and
cash flows of Winmax Trading Group, Inc. and Subsidiaries for the year ended
December 31, 2004, in conformity with United States generally accepted
accounting principles.


Goldstein Golub Kessler LLP
Certified Public Accountants

New York, New York
April 22, 2005

                                       F-3
<PAGE>

                   Winmax Trading Group, Inc. and Subsidiaries
                           Consolidated Balance Sheet
                                December 31, 2005
<TABLE>
<CAPTION>

                                     Assets
<S>                                                                     <C>
Current Assets
    Cash                                                                $        882
    Accounts Receivable                                                          965
    Inventory (Note 2)                                                        65,599
                                                                        ------------
      Total current assets                                                    67,446
                                                                        ------------
Other Assets
    Property and equipment, net (Note 3)                                      53,601
    Security Deposits                                                         28,757
                                                                        ------------
                                                                              82,358
                                                                        ------------
      Total Assets                                                      $    149,804
                                                                        ============
                    Liabilities and Stockholders' Deficiency

Current Liabilities
    Accounts payable & accrued expenses (Note 4)                        $  1,041,998
Long-term Liabilities
    Loans Payable - stockholders (Notes 5 & 11)                            2,003,141
                                                                        ------------
      Total Liabilities                                                    3,045,139
                                                                        ------------
Commitments (Note 9)
Stockholders' Deficiency
    Preferred Stock; $1.00 par value; authorized 1,000,000 shares,
    Issued and outstanding - none. (Note 6)                                        0
    Common stock;$.001 par value; authorized 750,000,000 shares,
    Issued and outstanding 30,124,162 shares (Note 6)                         30,124
    Additional paid-in capital (Note 6)                                   20,527,866
    Accumulated other comprehensive (loss)                                  (506,283)
    Accumulated deficit                                                  (22,947,042)
                                                                        ------------
               Total Stockholders' deficiency                             (2,895,335)
                                                                        ------------
               Total Liabilities & Stockholders' Deficiency             $    149,804
                                                                        ============
</TABLE>

See the accompanying notes to the consolidated financial statements.

                                       F-4
<PAGE>

                  Winmax Trading Group, Inc. and Subsidiaries
          Consolidated Statements of Operations and Comprehensive Loss
                     Years Ended December 31, 2005 and 2004

<TABLE>
<CAPTION>

                                                                          2005            2004
                                                                      ------------    ------------
<S>                                                                   <C>             <C>
Revenue:
    Sales - Retail Jewelry                                            $    112,500    $    184,235
    Sales - Websites                                                  $    130,735    $    171,585
                                                                      ------------    ------------
                                                                           243,235         355,820
                                                                      ------------    ------------
Operating Costs and Expenses:
    Cost of sales                                                           22,265          51,422
    Non-cash stock compensation (Note 7)                                 5,054,389         898,500
    General and administrative                                           1,973,475       3,014,289
                                                                      ------------    ------------
                                                                         7,050,129       3,964,211
                                                                      ------------    ------------
    Operating loss before other expenses
    and provision for income taxes                                      (6,806,894)     (3,608,391)

Other Expenses
    Loss on disposal of property
    and equipment (Note 3)                                            $    134,215              --
                                                                      ------------    ------------
    Loss before provision for income taxes                            $ (6,941,109)   $ (3,608,391)

    Provision for income taxes (Note 8)                               $         --              --
                                                                      ------------    ------------
    Net Loss                                                          $ (6,941,109)   $ (3,608,391)

Other comprehensive Loss:
    Foreign currency translation adjustment                               (123,627)       (283,767)
                                                                      ------------    ------------
Total Comprehensive loss                                              $ (7,064,736)   $ (3,892,158)
                                                                      ============    ============
Weighted-average number of common shares
outstanding - basic and diluted                                         25,471,691      18,091,599
                                                                      ============    ============
Net loss per common share -basic & diluted $                                 (0.28)   $      (0.22)
                                                                      ============    ============
</TABLE>

See the accompanying notes to the consolidated financial statements

                                       F-5
<PAGE>

                   Winmax Trading Group, Inc. and Subsidiaries
               Consolidated Statements of Stockholders' Deficiency
                     Years Ended December 31, 2005 and 2004

<TABLE>
<CAPTION>
                                                                                Accumulated
                                   Common            Stock      Additional      Other                 Accumulated
                                   Shares            Amount     Paid-in Capital Comprehensive loss    (Deficit)           Total
                                ------------      -----------   ------------    ------------          -----------      ------------
<S>                              <C>            <C>             <C>            <C>                   <C>              <C>
Balance January 1, 2004           16,156,736    $     16,156    $ 11,932,195    $    (98,889)         $(12,397,542)    $   (548,080)

Common shares issued
for services                       2,550,000           2,550         895,950              --                    --          898,500

Common stock issued
In conversion of stockholder
debt                               3,934,426           3,935       2,396,065              --                    --        2,400,000

Currency translation
adjustment                                --              --              --        (283,767)                   --         (283,767)

Net (loss) for the year                   --              --              --              --            (3,608,391)      (3,608,391)
                                ------------    ------------    ------------    ------------          ------------     ------------
Balance December 31,2004          22,641,162          22,641      15,224,210        (382,656)          (16,005,933)      (1,141,738)

Common shares issued
for services (Note 6)              7,483,000           7,483       5,046,906              --                    --        5,054,389

Forgiveness of debt by
stockholder                               --              --         256,750              --                    --          256,750

Currency translation
adjustment                                --              --              --        (123,627)                   --         (123,627)

Net (loss) for the year                   --              --              --              --            (6,941,109)      (6,941,109)
                                ------------    ------------    ------------    ------------          ------------     ------------
Balance December 31,2005          30,124,162    $     30,124    $ 20,527,866    $   (506,283)         $(22,947,042)    $ (2,895,335)
                                ============    ============    ============    ============          ============     ============
</TABLE>


      See the accompanying notes to the consolidated financial statements.

                                       F-6
<PAGE>

                   Winmax Trading Group, Inc. and Subsidiaries
                      Consolidated Statements of Cash Flows
                     Years Ended December 31, 2005 and 2004

<TABLE>
<CAPTION>


                                                                                   2005           2004
                                                                                -----------    -----------
<S>                                                                             <C>            <C>
Cash flows from operating activities:
Net loss                                                                        $(6,941,109)   $(3,608,391)
  Adjustments to reconcile net (loss) to net
   cash used by operating activities:
   Depreciation                                                                      33,206         95,391
   Common stock issued for services                                               5,054,389        898,500
   Loss on disposal of property and equipment                                       134,215             --
Changes in assets and liabilities:
   Decrease (Increase) in accounts receivable                                         2,873         (3,740)
   Decrease (Increase) in inventory                                                  39,327        (73,133)
   Decrease in prepaid expense                                                        4,650          3,304
   Increase in accounts payable and accrued expense                                 614,878        371,537
                                                                                -----------    -----------
  Net cash (used in) operating activities                                        (1,057,571)    (2,316,532)
                                                                                -----------    -----------
Cash flows from investing activities:
   Purchase of property and equipment                                                (1,076)      (175,444)
   Increase in other assets                                                         (26,357)            --
                                                                                -----------    -----------
  Net cash (used in) investing activities                                           (27,433)      (175,444)

Cash flows from financing activities:
  Proceeds from loans payable - stockholders                                      1,209,513      2,859,809
                                                                                -----------    -----------
  Net cash provided by financing activities                                       1,209,513      2,859,809

Effect of exchange rate changes on cash                                            (123,627)      (372,653)
                                                                                -----------    -----------
Net Increase (Decrease) in cash                                                         882         (4,820)

Cash at beginning of year                                                                 0          4,820
                                                                                -----------    -----------
Cash at end of year                                                             $       882    $         0
                                                                                ===========    ===========

Supplemental disclosures of cash flow information:
Cash paid during the year for:
           Interest                                                             $         0    $         0
                                                                                ===========    ===========
           Income Taxes                                                         $         0    $         0
                                                                                ===========    ===========
Supplemental disclosures of noncash financing activities:
    Conversion of stockholder loans to common stock                             $        --    $ 2,400,000
    Forgiveness of debt by shareholder
    applied to additional Paid-In-Capital                                           256,750              0
    Reduction of shareholder's loan                                                  13,865              0
                                                                                ===========    ===========
                                                                                $   270,615    $ 2,400,000
                                                                                ===========    ===========
</TABLE>

      See the accompanying notes to the consolidated financial statements.

                                       F-7
<PAGE>

                   Winmax Trading Group, Inc. and Subsidiaries
                   Notes to Consolidated Financial Statements
                                December 31, 2005


NOTE 1 - ORGANIZATION AND BASIS OF PRESENTATION

The consolidated balance sheet of Winmax Trading Group, Inc., a Florida
Corporation and Subsidiaries (collectively, the "Company") as of December 31,
2005, and the related statements of operations and comprehensive loss and cash
flows for the years ended December 31, 2005 and December 31, 2004 have been
prepared by the Company, pursuant to the rules and regulations of the Securities
and Exchange Commission (the "Commission").

Basis of Consolidation

The consolidated financial statements include the accounts of Winmax Trading
Group, Inc. and its following wholly owned subsidiaries as follows:
   OPERATING COMPANIES
           Winmax Trading Group, Inc.
           The Gemstore Group Inc.
           TheGemstore Inc.
           TheGemstore.COM, Inc.
           The Gemstore of New York, Inc.
   Non-OPERATING COMPANIES
           Winmax Capital Group,Inc.
           Winmax Media, Inc. (USA)
           Winmax Media, Inc.
           BnetTV, Inc
           BnetTV.COM, Inc.

All significant intercompany balances and transactions have been eliminated in
consolidation.

Principal Business Activities

Winmax Trading Group, Inc.
Administers the activities of the subsidiaries and controls WEB development,
design and WEB casting as well as e-commerce and internet solutions.

The Gemstore Group Inc.
Administers the Canadian Head Office and business development.

TheGemstore Inc.
Retail jewelry sales.
TheGemstore.COM, Inc.
ON-line jewelry Web sales.

                                       F-8

<PAGE>

Going Concern

The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. As reflected in the 2005 and
2004 financial statements, the Company has incurred substantial losses from
continuing operations, sustained substantial cash outflows from operating
activities, and has significant working capital and stockholders' deficiencies
at December 31, 2005 and December 31, 2004. The above factors raise substantial
doubt about the Company's ability to continue as a going concern. The Company's
continued existence depends on its ability to obtain additional equity and/or
debt financing to fund its operations and ultimately to achieve profitable
operations. The Company is attempting to raise additional financing and has
initiated a cost reduction strategy.

During 2006, the Company plans to raise additional funding from debt and equity
transactions. Should it receive adequate funding, the Company intends to further
develop and bring to market a new Internet web based and WAP (wireless
application protocol) microsite based portal. The portal is being developed to
capture advertising and subscription revenue by providing end users a multiple
access portal to manage, distribute and allow friends and associates access to
emails, pictures and video files. The portal is strategically positioned to fill
a gap in current online communities and the technology available to share video
files from mobile devices. The Company also plans to acquire additional point of
sale outlets for the TheGemstore's in an attempt to increase sales.
Additionally, pending adequate funding, the Company plans to implement certain
cost management practices and to increase the Company's focus on business
development. The Company's management has agreed to provide the necessary
funding for an additional two years.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Revenue Recognition

The Company recognizes revenue in accordance with the Securities and Exchange
Commission's Staff Accounting Bulletin No. 104 "Revenue Recognition" ("SAB
104"). Revenue related to merchandise sales is recognized at the time of sale
reduced by a provision for returns. The provision for returns is based on
historical evidence of the Company's return rate. To date this evidence of
returns is negligible so no current provision has been made for returns. Revenue
related to Web site sales is recognized on completion of the site and acceptance
by the customer.

Accounts Receivable

Accounts receivable are reported as amounts expected to be collected, net of
allowance for non-collection due to the financial position of customers. It is
the Company's policy to regularly review the accounts receivable aging for
specific accounts past due and set up an allowance when collection is uncertain.

                                      F-9
<PAGE>

Credit Risk

Financial instruments which potentially subject the Company to concentrations of
credit risk consist principally of cash and accounts receivable. The Company
places its cash with high quality financial institutions and limits the amount
of credit exposure to any single financial institution or instrument. As to
accounts receivable, the Company performs credit evaluations of customers before
services are rendered and generally requires no collateral.

Inventory

Inventory is stated at the lower of cost, determined by the
specific-identification method, or market. Inventory consists principally of
purchased gemstones.

Property, Equipment and Depreciation

Property and equipment is recorded at cost. Depreciation is provided over the
estimated useful lives of the respective assets on a straight-line basis (see
Note 3).

Estimates

The preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
and assumptions that effect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements, if any, and the reported amounts of revenue and expenses during the
reporting periods. Actual results could differ from those estimates.

Fair Value of Financial Instruments

The fair value of financial instruments, specifically loans payable -
stockholders, cannot be estimated due to the nature and terms of this payable.

Long Lived Assets

Long lived assets held and used by the Company are reviewed for possible
impairment whenever events or circumstances indicated the carrying amount may
not be recoverable or is impaired.

Earnings (Loss) Per Share

The Company follows Statements of Financial Accounting Standards ("SFAS") No.
128, Earnings per Share. Basic (loss) per common share calculations are
determined by dividing net income (loss) by the weighted-average number of
shares of common stock outstanding during the year. For the year ended December
31, 2005, the effect of stock warrants has been excluded from the dilutive
calculation as the impact of the stock warrants would be anti-dilutive. There
was no potential common stock issued for the year ended 2004.

                                      F-10
<PAGE>

Comprehensive Loss

The Company adopted the provisions of SFAS No. 130, Reporting Comprehensive
Income, which establishes standards for reporting and display of comprehensive
income and its components in the financial statements.

The local currency (Canadian dollar) is the financial currency for two of the
Company's consolidated subsidiaries. Assets and liabilities are translated using
the exchange rate in effect at the balance sheet date. Income and expenses are
translated at the average exchange rate for the year. Translation adjustments
are reported as a separate component of stockholders' deficiency called
Accumulated Other Comprehensive Loss.

Segments

The Company follows FASB Statement No. 131, "Disclosures about Segments of an
Enterprise and Related Information". SFAS No. 131 requires that a business
enterprise report a measure of segment profit or loss and certain specific
revenue and expense items. Operating segments are components of an enterprise
about which separate financial information is available that is evaluated
regularly by the chief operating decision maker in deciding how to allocate
resources and in assessing performance.

Stock-Based Compensation

The Company accounts for stock-based compensation in accordance with SFAS No.
123, Accounting for Stock-Based Compensation. The provisions of SFAS No. 123
allow companies to either expense the estimated fair value of stock options or
to continue to follow the intrinsic value method set forth in Accounting
Principles Board ("APB") Option No. 25, Accounting for Stock Issued to
Employees, but disclose the pro forma effects on net income (loss) had the fair
value of the options been expensed. The Company has elected to apply APB No. 25
in accounting for its stock option incentive plan for the year ended December
31, 2004.

In 2005, The Company accounted for stock-based compensation in accordance with
SFAS No. 123(R), Accounting for Stock-Based Compensation. The provisions of SFAS
No. 123(R) require the Company to measure the cost of all employee stock-based
compensation rewards that are expected to be exercised and which are granted
based on the grant date fair value of these awards and to record that cost as
compensation expense over the period during which the employee is required to
perform service in exchange for the award (generally over the vesting period of
the award) (see Note 7).

Income Taxes

The Company applies the provisions of SFAS No. 109, Accounting for Income Taxes,
for recording the provision for income taxes. Deferred tax assets and
liabilities are computed based upon the difference between the financial
statements and income tax basis of assets and liabilities using the enacted tax
rate applicable when the related asset or liability is expected to be realized
or settled. Deferred income tax expenses or benefits are based on the changes in
the asset or liability in each period. If available evidence suggests that it is
more likely than not that some portion or all of the deferred tax assets will
not be realized, a valuation allowance is recorded to reduce the deferred tax
assets to the amount, if any, that is more likely than not to be realized.
Future changes in such valuation allowance are included in the provision for
deferred income taxes in the period of change.

                                      F-11
<PAGE>

Deferred income taxes may rise from temporary differences resulting from income
and expense items reported for financial accounting and tax purposes in
different periods. Deferred taxes are classified as current or noncurrent
depending on the classification of assets and liabilities to which they relate.
Deferred taxes arising from temporary differences that are not related to an
asset or liability are classified as current or noncurrent depending on the
periods in which the temporary differences are expected to reverse (see Note 8).

Recent Accounting Pronouncements

In December 2004, FASB issued SFAS No. 153, "Exchange of Nonmonetary Assets - An
Amendment of APB Opinion No. 29". The guidance in APB Opinion No. 29,
"Accounting for Nonmonetary Transactions", is based on the principle that
exchanges of nonmonetary assets should be measured based on the fair value of
the assets exchanged. The guidance in that Opinion, however, included certain
exceptions to the principle. SFAS No. 153 amends Opinion No. 29 to eliminate the
exception for nonmonetray exchanges of similar productive assets and replaces it
with a general exception for exchanges of nonmonetrary assets that do not have
commercial substance. A nonmonetary exchange has commercial substance if the
future cash flows of the entity are expected to change significantly as a result
of the exchange. The provision of SFAS No. 153 are effective for nonmonetary
asset exchanges occurring in fiscal periods beginning after June 15, 2005. Early
application is permitted and companies must apply the standard prospectively.
The Company is in the process of determining the effects of adoption of SFAS
153.

The Financial Accounting Board issued two new statements, No. 155 "Accounting
for Certain Hybrid Financial Instruments", and No. 154 "Accounting Changes and
Error Corrections". The Company doesn't expect these new statements will have
any impact on its operations.

NOTE 3. PROPERTY AND EQUIPMENT

Property and equipment are stated at cost at December 31, 2005 and consist of
the following:


                                   Estimated Useful Life          2005
                                   ---------------------       ---------
Furniture, software and equipment            3 - 5 years      $ 274,179
Less accumulated depreciation                                  (220,578)
                                                               --------
                                                              $  53,601
                                                              =========

Depreciation expense was $33,206 and $95,391 for the years ended December 31,
2005 and 2004, respectively.

In 2005, the Company closed some of its Retail Merchandising Units which
resulted in a Loss on Disposal of Property and Equipment of $134,215.

NOTE 4. ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Included in accrued expenses are $334,603 in payroll taxes payable to the
Canadian Government as of December 31, 2005 and these amounts are in dispute. It
includes $168,425 in payroll taxes payable to the Canadian Government from
December 31, 2004. Also in 2005 there is an accrual for interest and penalties
of $67,290 payable to the Canadian Government. In addition in 2005, there is an
accrual for $85,089 in United States payroll taxes for the years 2005 and 2004.
In 2004 the United States payroll taxes payable were $59,480. Also in 2005 there
is an accrual of $26,422 in interest and penalties for the United States payroll
taxes not paid. For the years 2004 and 2005 appropriate payroll tax filings have
not been made in the United States and the States of New York, Florida and
California. Partial payments have been made on these accounts. Because the
Company has failed to make these tax related filings or make the required tax
payments the Company may be subject to civil fines and forfeitures.

                                      F-12

<PAGE>

NOTE 5. LOANS PAYABLE TO STOCKHOLDERS

(a) Principal Stockholder Loan
Loan payable to stockholders consists of working capital loans to the Company
from the chief executive officer and majority stockholder. The loan bears no
interest and the stockholder has indicated that he will not seek repayment prior
to January 1, 2007. As of the December 31, 2005 the amount due to the chief
executive officer, and majority stockholder was $1,833,519 (Also see Note 11).

(b) Other Stockholder Loan
Loan payable to stockholders consists of working capital loans to the Company
from the vice-president, and director. The loan bears no interest and the
stockholder has indicated that he will not seek repayment prior to January 1,
2007. As of the December 31, 2005 the amount due to the vice-president, and
director was $169,622.

If interest were to be charged on the above loans payable to stockholders it
would be approximately $70,000 calculated at the rate of 3.5%(apr) on the total
loans payable balance of $2,003,141.

NOTE 6. EQUITY TRANSACTIONS

(a) Common Stock

During 2004, the Chief Executive Officer and majority stockholder converted
$2,400,000 in loans into 3,934,426 shares of the Company's common stock. The
shares were valued at their fair market value at the date of the agreement.

Also during 2004, the Company issued 2,550,000 shares to consultants for
services performed. All share issuances were valued at their fair market value
at the date of grant and aggregated $898,500.

During 2005, the Company issued 7,483,000 shares (3,358,000 shares issued under
the terms of the Company's 2005 Non-Qualified Stock Award and Option Plan and
4,125,000 shares issued exempted from registration under Section 4(2) and 4(6)
of the Securities Act of 1933, as amended ("Securities Act")) to employees and
consultants for services performed. All share issuances were valued at their
fair market value at the date of grant. Unregistered common shares issued in
2005 aggregating 4,125,000 having a total value of $3,329,750 were as follows:

                                      F-13

<PAGE>

(1) On June 14, 2005, the Company issued 100,000 shares of common stock to a
    non-related consultant in exchange for banking service, and media
    presentations. Valued at $0.50 per share or an aggregate of $50,000. The
    Company relied upon the exemption from registration afforded by Sections
    4(2) and 4(6) of the Securities Act as amended, for the offer and sale. The
    Company believed that Sections 4(2) and 4(6) were available because the
    offer and sale did not involve a public offering and there was no general
    solicitation or general advertising involved in the offer or sale. The
    Company placed restrictive legends on the certificates representing these
    securities stating that the securities were not registered under the
    Securities Act and are subject to restrictions on their transferability and
    resale. In addition the Company granted the above consultant a warrant to
    purchase 100,000 common stock of the Company with an exercise price of US-$
    1.00 per share to expire June 14 2010; and a warrant to purchase 100,000
    common stock of the Company with an exercise price of US-$ 1.50 per share to
    expire June 14 2010. In issuing these warrants the Company relied upon the
    exemption from registration afforded by Sections 4(2) and 4(6) of the
    Securities Act for the offer and sale. The Company believed that Sections
    4(2) and 4(6) were available because the offer and sale did not involve a
    public offering and there was no general solicitation or general advertising
    involved in the offer or sale. The Company placed restrictive legends on the
    certificates representing these securities stating that the securities were
    not registered under the Securities Act and are subject to restrictions on
    their transferability and resale. As at December 31, 2005 these warrants
    were still valid and outstanding.

(2) On June 29, 2005, the Company issued 100,000 shares of common stock to a
    non-related consultant in exchange for promotional services. The shares were
    valued at $0.40 per share or an aggregate of $40,000. The Company relied
    upon the exemption from registration afforded by Sections 4(2) and 4(6) of
    the Securities Act, as amended for the offer and sale. The Company believed
    that Sections 4(2) and 4(6) were available because the offer and sale did
    not involve a public offering and there was no general solicitation or
    general advertising involved in the offer or sale. The Company placed
    restrictive legends on the certificates representing these securities
    issued, stating that the securities were not registered under the Securities
    Act and are subject to restrictions on their transferability and resale.

(3) On June 29, 2005, the Company issued 1,000,000 shares of common stock to a
    director in exchange for corporate services related to Thegemstore, and
    thegemstore.com. The shares were valued at $0.40 per share or an aggregate
    of $400,000. We relied upon the exemption from registration afforded by
    Sections 4(2) and 4(6) of the Securities Act, as amended for the offer and
    sale. The Company believed that Sections 4(2) and 4(6) were available
    because the offer and sale did not involve a public offering and there was
    no general solicitation or general advertising involved in the offer or
    sale. The Company placed restrictive legends on the certificates
    representing these securities issued, stating that the securities were not
    registered under the Securities Act and are subject to restrictions on their
    transferability and resale.

(4) On July 11, 2005 the Company issued 2,500,000 shares of common stock to two
    non-related consultants in exchange for National TV and radio and other
    media related services. These services will run for three years and will
    expire in July of 2008. The shares were valued at $1.06 per share or an
    aggregate of $2,650,000. The Company relied upon the exemption from
    registration afforded by Sections 4(2) and 4(6) of the Securities Act, as
    amended for the offer and sale. The Company believed that Sections 4(2) and
    4(6) were available because the offer and sale did not involve a public
    offering and there was no general solicitation or general advertising
    involved in the offer or sale. The Company placed restrictive legends on the
    certificates representing these securities, stating that the securities were
    not registered under the Securities Act and are subject to restrictions on
    their transferability and resale.

                                      F-14
<PAGE>

(5) On September 19, 2005 the Company issued 75,000 shares of common stock to
    two non-related consultants in exchange for promotional related services.
    The shares were valued at $0.75 per share or an aggregate of $56,250. The
    Company relied upon the exemption from registration afforded by Sections
    4(2) and 4(6) of the Securities Act, as amended for the offer and sale. The
    Company believed that Sections 4(2) and 4(6) were available because the
    offer and sale did not involve a public offering and there was no general
    solicitation or general advertising involved in the offer or sale. The
    Company placed restrictive legends on the certificates representing these
    securities issued, stating that the securities were not registered under the
    Securities Act and are subject to restrictions on their transferability and
    resale.

(6) On October 26, 2005 the Company issued 50,000 shares of common stock to a
    non-related consultant in exchange for promotional services. The shares were
    valued at $0.39 per share or an aggregate of $19,500 The Company relied upon
    the exemption from registration afforded by Sections 4(2) and 4(6) of the
    Securities Act, as amended for the offer and sale. The Company believed that
    Sections 4(2) and 4(6) were available because the offer and sale did not
    involve a public offering and there was no general solicitation or general
    advertising involved in the offer or sale. The Company placed restrictive
    legends on the certificates representing these securities issued, stating
    that the securities were not registered under the Securities Act and are
    subject to restrictions on their transferability and resale.

(7) On November 29, 2005, the Company issued 300,000 shares of common stock to a
    non-related consultant in exchange for real estate services. The shares were
    valued at $0.38 per share or an aggregate of $114,000. The Company relied
    upon the exemption from registration afforded by Sections 4(2) and 4(6) of
    the Securities Act, as amended for the offer and sale. The Company believed
    that Sections 4(2) and 4(6) were available because the offer and sale did
    not involve a public offering and there was no general solicitation or
    general advertising involved in the offer or sale. The Company placed
    restrictive legends on the certificates representing these securities
    issued, stating that the securities were not registered under the Securities
    Act and are subject to restrictions on their transferability and resale.

During 2005, the Company issued 3,358,000 shares under the 2005 Non-Qualified
Stock Award and Option Plan. Shares issued had a total value of $1,724,639. All
shares issued were to employees and consultants for services. All shares were
valued at their fair market value at the date of grant. The shares issued and
the recipient and value of those shares were as follows:

      (1)   On July 8, 2005, the Company issued 1,363,000 shares of common stock
            having an aggregate market value of $903,669, to a number of
            employees and consultants for services rendered.

      (2)   On August 15, 2005, the company issued 125,000 shares of common
            stock having an aggregate market value of $98,750, to a consultant
            for services rendered.

      (3)   On August 30, 2005, the company issued 50,000 shares of common stock
            having an aggregate market value of $31,500, to an employee and a
            consultant for services rendered.

      (4)   On September 6, 2005, the company issued 445,000 shares of common
            stock having an aggregate market value of $289,250, to a number of
            employees and consultants for services rendered.

      (5)   On October 18, 2005, the company issued 50,000 shares of common
            stock having an aggregate market value of $24,500, to a consultant
            for services rendered.

      (6)   On November 18, 2005, the company issued 600,000 shares of common
            stock having an aggregate market value of $198,000, to a number of
            employees and consultants for services rendered.

                                      F-15
<PAGE>

      (7)   On December 1, 2005, the company issued 50,000 shares of common
            stock having an aggregate market value of $16,500, to a number of
            consultants for services rendered.

      (8)   On December 8, 2005, the company issued 190,000 shares of common
            stock having an aggregate market value of $83,600, to an employee
            and a consultant for services rendered.

      (9)   On December 12, 2005, the company issued 60,000 shares of common
            stock having an aggregate market value of $15,120, to an employee
            and a consultant for services rendered.

      (10)  On December 19, 2005, the company issued 425,000 shares of common
            stock having an aggregate market value of $63,750, to a number of
            employees and consultants for services rendered.

Management's decision is to expense the full value of the consideration given
with respect to these consulting agreements which cover a 3 year period so that
the financial statements would properly reflect real asset values.

(b) Preferred Stock

On or about January 17, 2006, the Company amended the Articles of Incorporation
to set forth the preferences, limitations, rights and terms of the Company's
Series A Redeemable Convertible Preferred Stock ("Series A Preferred").

The Articles of Amendment to the Articles of Incorporation set forth the
following preferences, limitations, rights, and terms:

Preferences

The Series A Preferred will have priority over all of the Company's other stock
previously issued as to rights of payment and distribution, including priority
as to dividend or upon liquidation.

Dividends

Series A Preferred stockholders will be entitled to receive annually on the date
of conversion on January 7th of each year (beginning in the year 2007) until
such Series A Preferred is either converted or redeemed, dividends at the rate
of 6% per annum of $70,000. All dividends declared upon the Series A Preferred
will be declared pro rata per share. At the Company's option, a dividend may be
paid in cash or restricted shares of the Company's common stock. If dividends
are paid in the Company's common stock, its value will be determined based on
the 20-day volume-weighted average of the bid price of the Company's common
stock.

Redemption

The Series A Preferred will be redeemed at the Company's option for the purchase
price of $70,000 of each Unit plus any accrued and unpaid dividends, upon 30
days prior written notice at any time six months after the Securities and
Exchange Commission declares effective the Registration Statement regarding the
Series A Preferred and the common stock underlying such Preferred Shares. The
Company may only effect such redemption if from the date of the Notice of
Redemption through the Redemption Date: (i) the Company have duly honored all
conversions and redemptions, if any, scheduled to occur or occurring prior to
the Redemption Date, and (ii) the registration statement is currently effective
for the resale by the Holder of the common shares registered and not subject to
any stop order suspending its effectiveness.

                                      F-16
<PAGE>

Voting

Each issued and outstanding share of the Series A Preferred will be entitled to
vote the number of shares each could vote if the shares were fully converted at
each stockholders meeting regarding any and all matters presented to the
Company's stockholders for their action or consideration (subject to adjustment
whenever there shall occur a stock split, stock dividend, combination,
recapitalization, reclassification or other similar event involving a change in
the Series A Preferred). Except as provided by law or by the provisions
establishing any other series of preferred stock, Series A Preferred
Stockholders and holders of any other outstanding preferred stock, shall vote
together with the Common Stock holders as a single class. The Company will not
amend, alter or repeal the preferences, special rights or other powers of the
Series A Preferred so as to adversely affect that class of stock, without the
written consent or affirmative vote of the holders of at least a majority of the
then outstanding aggregate number of shares of such affected Series A Preferred
Stock.

Conversion

The number of shares of Common Stock a holder of Series A Preferred will be
entitled to receive upon conversion will be determined by multiplying the
Conversion Rate (as defined in the Certificate of Amendment) by the number of
shares of Series A Preferred being converted at any time.

Mandatory Conversion

The Company may, at any time after January 1, 2006, require that any or all
outstanding Series A Preferred be converted into Common Stock if the Common
Stock into which the Series A Preferred is convertible is registered pursuant to
an effective registration statement under the Securities Act of 1933, as
amended, by delivery to the Series A Preferred Stockholders, for each share of
Series A Preferred converted, the number of shares of Common Stock determined by
multiplying the Conversion rate by the number of Series A Preferred shares held.
In order to exercise a mandatory conversion, the Company must provide all Series
A Preferred Stockholders notice of the conversion at least 30 days prior to the
Conversion Date, such notice to include the number of shares to be converted and
instructions for surrender of the certificate or certificates representing the
Series A Preferred Stock.

NOTE 7. STOCK-BASED COMPENSATION

On July 7, 2005, the Company's Board of Directors approved the
Employee/Consultant 2005 Non-Qualified Stock Award and Option Plan (the "Plan").
The purpose of the Plan is to further the Company's growth by allowing the
Company to compensate employees and consultants who have provided bona fide
services to the Company through the award of the Company common stock. The
maximum number of shares of common stock that may be issued under the Plan is
3,500,000 as stock award and 3,000,000 as stock option plan.

The Board of Directors is responsible for the administration of the Plan and has
full authority to grant awards under the Plan. Awards may take the form of stock
grants, options or warrants to purchase common stock. The Board of Directors has
the authority to determine; (a) the employees and consultants that will receive
awards under the Plan,

                                      F-17
<PAGE>

(b) the number of shares, options or warrants to be granted to each employee or
consultant, (c) the exercise price, term and vesting periods, if any, in
connection with an option grant, and (d) the purchase price and vesting period,
if any, in connection with the granting of a warrant to purchase shares of the
Company's common stock.

On July 8, 2005, the Company filed a Registration Statement on Form S-8 with the
Securities and Exchange Commission that covered the issuance of up to 6,500,000
shares of common stock under the Plan. As of December 31, 2005, the Company has
issued a total of 3,358,000 shares under the Plan. These shares were issued to
various employees and consultants for services rendered during 2005 (see Note
6). Subsequent to December 31, 2005, and as of the date of this filing, the
Company issued an additional 2,915,000 shares to various employees and
consultants for services rendered.

The following table summarizes the Company's equity compensation plan
information as of December 31, 2005.

<TABLE>
<CAPTION>
                                       Number of
Number of                              Securities                                                                   Number of
Securities                             issued upon                                                                  securities
Available                              exercise of                                     Weighted                     remaining
Under the Stock                        Stock Award                                     average                      Available
Award and Option                       and Option                                      exercise                     For future
Plan                                   Plan                                            price                        Issuance
--------------                         --------------                                  ---------                    ----------
<S>                                    <C>                                             <C>                          <C>
6,500,000                              3,358,000                                        .5136                       3,142,000
=========                              ==============                                  =========                    ==========
</TABLE>

There were no options outstanding in 2004, and there were warrants to purchase
200,000 shares of common stock outstanding as of December 31, 2005.

NOTE 8. INCOME TAXES

The following summarizes the provision for income taxes:

                                         Year Ended            Year Ended
                                      December 31, 2005    December 31, 2004
                                      -----------------    -----------------

Currently Payable                       $         0           $         0
Deferred tax (benefit)                   (2,682,000)           (2,000,000)
                                        -----------           -----------
Total                                   $(2,682,000)          $(2,000,000)
Valuation Allowance                       2,682,000             2,000,000
                                        -----------           -----------
Net Provision for income taxes          $         0           $         0
                                        ===========           ===========

The amounts shown for income taxes in the statement of operations differ from
amounts that would be derived from computing income taxes at federal statutory
rates. The following is a reconciliation of those differences.

<TABLE>
<CAPTION>

December 31,                                                     2005                2004
----------------------------------------------------------------------    ----------------
<S>                                                              <C>                 <C>
Tax at federal statutory rate                                    (34%)               (34%)
Increase in valuation allowance                                   34                  34
----------------------------------------------------------------------    ----------------
                                                                 -0-%                -0-%
----------------------------------------------------------------------    ----------------
</TABLE>

Deferred income taxes have been provided for differences between financial
statement and income tax reporting purposes, consisting primarily of a net
operating loss carry forwards aggregating approximately $7,887,000 which expires
through 2025. This deferred tax benefit has been reduced in full by a valuation
allowance due to uncertainty regarding its ultimate utilization.

                                      F-18
<PAGE>

In addition, there may be limitations on the use of the net operating loss due
to a change of control in 2001. No corporate income tax returns have been filed
for the Company for the years 2001 to 2005 inclusive.

NOTE 9. COMMITMENTS

Operating leases

Future annual minimum lease payments for office and retail store space under
non-cancelable operating leases are summarized as follows:

   Year Ending               Total
   December 31,             Amount                  N.Y.                 Canada
   ------------            --------              --------              ---------
         2006              $178,198              $131,143              $ 47,055
         2007                75,982                75,982                     0
                           --------              --------              --------
                           $254,180              $207,125              $ 47,055
                           ========              ========              ========

Total rent expense for the years ended December 31, 2005 and 2004 were $510,683
and $540,503 respectively.

NOTE 10. RELATED PARTY TRANSACTIONS

The Company entered into agreements with the following related parties:

(1)   Consulting Agreement with Anthony Sklar
      The Company has a July 8, 2005 agreement with Anthony Sklar, our
      President's son, who is identified in the agreement as "Consultant". The
      agreement provides that the Consultant will: (a) represent the Company's
      divisions and products to potential clients, distributors, retailers
      throughout North America, and other countries worldwide; (b ) provide
      general business consulting, including but not limited to developing
      products; (c) locate top quality management to help fuel the Company's
      growth; (d) identify sources for distribution, manufacturing and other
      partners necessary in the processing and finishing of the Company's
      products; (e)provide retail-merchandising services throughout North
      America and other countries worldwide; and (f) such other duties as may be
      assigned by the Company's Board of Directors or President. In return for
      these services the Company agrees to pay the Consultant 700,000 shares of
      common stock registered on the Company's S-8 Registration Statement.
      However, on January 3, 2006 that agreement was amended to provide
      additional compensation to Anthony Sklar of 700,000 shares of common
      stock. On July 8, 2005 the Company issued 250,000 S-8 shares to Anthony
      Sklar. Each share was valued at $0.663 or an aggregate of $165,750. On
      September 6, 2005, the Company issued 50,000 S-8 shares to Anthony Sklar.
      Each share was valued at $0.65 or an aggregate of $32,500. On October 18,
      2005, the Company issued 50,000 S-8 shares to Anthony Sklar. Each share
      was valued at $0.49 or an aggregate of $24,500. On November 18, 2005, the
      Company issued 150,000 S-8 shares to Anthony Sklar. Each share was valued
      at $0.33 or an aggregate of $49,500. On December 19, 2005, the Company
      issued 150,000 S-8 shares to Anthony Sklar. Each share was valued at $0.15
      or an aggregate of $22,500. The term of the agreement is 3 years. On
      January 3, 2006, the Company issued 150,000 S-8 shares to Anthony Sklar.
      Each share was valued at $0.24 or an aggregate of $36,000. On March 3,
      2006, the Company issued 100,000 S-8 shares to Anthony Sklar. Each share
      was valued at $0.21 or an aggregate of $21,000.

                                      F-19
<PAGE>

(2)   Consulting Agreement with Samantha Fryer
      The Company has a July 8, 2005 agreement with Samantha Fryer, the
      Company's President's Daughter-in-law, in which Samantha Fryer, who is
      identified in the agreement as "Consultant", will perform the following
      duties: (a) represent products to distributors and retailers throughout
      North America and other countries worldwide; (b) provide general business
      consulting, including development of products and the building of the
      retail division; (c) locate quality personnel to work in the Company
      retail division; (d) locate in-line and RMU locations for further
      compensation;(d) identify sources for sale and distribution of products to
      be sold in the Company retail division; and (e) such other duties as may
      be assigned by the Company's board of directors or president. In return
      for these services, the Company agreed to pay the Consultant 500,000
      shares of common stock issued pursuant to the Company's S-8 registration
      statement; however, on January 3, 2006 that agreement was amended to
      provide additional compensation to Ms Fryer of 500,000 shares of common
      stock. On July 8, 2005 the Company issued 300,000 S-8 shares to Samantha
      Fryer. Each share was valued at $0.663 or an aggregate of $198,900. On
      November 18, 2005, the Company issued 100,000 S-8 shares to Samantha
      Fryer. Each share was valued at $0.33 or an aggregate of $33,000. On
      December 19, 2005, the Company issued 100,000 S-8 shares to Samantha
      Fryer. Each share was valued at $0.15 or an aggregate of $15,000. The term
      of the agreement is 2 years. On January 3, 2006, the Company issued
      150,000 S-8 shares to Samantha Fryer. Each share was valued at $0.24 or an
      aggregate of $36,000.

(3)   Lisa Danita Young
      On November 18, 2005, the Company issued 50,000 S-8 shares to Ms. Young.
      Each share was valued at $0.33 or an aggregate of $16,500. On December 19,
      2005, the Company issued 50,000 S-8 shares to Ms. Young. Each share was
      valued at $0.15 or an aggregate of $7,500. Lisa Danita Young is the wife
      of Dave Young, Vice-President and Director. On February 23, 2006, the
      Company issued 50,000 S-8 shares to Ms. Young. Each share was valued at
      $0.28 or an aggregate of $14,000. On March 29, 2006, the Company issued
      50,000 S-8 shares to Ms. Young. Each share was valued at $0.21 or an
      aggregate of $10,500.

(4)   Michelle Sklar
      During 2005, Michelle Sklar, our Chief Executive's daughter, was employed
      by the Company, as on-air talent and consultant and was paid a fee of
      $38,010.

The Company reimbursed Anthony Sklar approximately $30,000 for the period
January 1, 2005 to May 31, 2005 for the use of space.


                                      F-20

<PAGE>

NOTE 11. SUBSEQUENT EVENTS

In addition to the transactions mentioned in notes 6 and 10 the following
transactions occurred in 2006:

In January 2006, the Company effected the incorporation of Sapphire Media, LLC
in Florida as the Company's wholly owned subsidiary to provide consulting and
investor relation services to small and medium sized companies. To date,
Sapphire Media has not commenced operations.

During 2006, the Chief Executive Officer and majority stockholder converted
$525,000 in loans into 2,500,000 shares of the Company's common stock. The
shares were valued at their fair market value at the date of the agreement.

NOTE 12. MAJOR CUSTOMER CONCENTRATION

The Company derived approximately 54% and 48% of its revenues from one customer,
a non-affiliated entity, in 2005 and 2004, respectively.

NOTE 13. SEGMENTS AND RELATED INFORMATION

The accounting policies of the segments are the same as those described in the
summary of significant accounting policies. The Company evaluates performance
based on operating earnings of the respective units, segregated into web
development, design, internet solutions and e-business, and a retail store for
the sale of gemstone material and finished jewelry. The "Unallocated" column
includes expenses incurred by the parent corporation, Winmax Trading Group Inc.,
including corporate operating expenses, not specifically allocated to either
operating segment.

<TABLE>
<CAPTION>

                                                                                    2005
                                                          --------------------------------------------------------
                                                              Jewelry       Websites    Unallocated         Totals
                                                          -----------   ------------    -----------    -----------

<S>                                                       <C>            <C>            <C>            <C>
Sales                                                     $   112,500    $   130,735    $         0    $   243,235
                                                          -----------    -----------    -----------    -----------

Operating Costs and Expenses:
Cost of Sales                                                  22,265              0              0         22,265
Non-cash stock compensation                                   958,150        330,520      3,765,719      5,054,389
General and Administrative                                    804,898      1,168,577              0      1,973,475
                                                          -----------    -----------    -----------    -----------
                                                            1,785,313      1,499,097      3,765,719      7,050,129
                                                          -----------    -----------    -----------    -----------

Operating loss before other expenses
    and provision for income taxes                         (1,672,813)    (1,368,362)    (3,765,719)    (6,806,894)
Other expenses                                                134,215              0              0        134,215
                                                          -----------    -----------    -----------    -----------
Loss before provision of income taxes                      (1,807,028)    (1,368,362)    (3,765,719)    (6,941,109)
Provision for income taxes                                          0              0              0              0
                                                          -----------    -----------    -----------    -----------
Net loss                                                  $(1,807,028)   $(1,368,362)   $(3,765,719)   $(6,941,109)
                                                          ===========    ===========    ===========    ===========
</TABLE>



                                      F-21
<PAGE>

<TABLE>
<CAPTION>

                                                                                   2004
                                                         --------------------------------------------------------
                                                           Jewelry       Websites      Unallocated       Totals
                                                         -----------    -----------    -----------    -----------
<S>                                                      <C>            <C>                      <C>      <C>

Sales                                                    $   184,235    $   171,585              0        355,820
                                                         -----------    -----------    -----------    -----------

Operating Costs and Expenses:
Cost of Sales                                                 51,422              0              0         51,422
Non-cash stock compensation                                  403,000              0        495,500        898,500
General and Administrative                                 2,199,805        814,484              0      3,014,289
                                                         -----------    -----------    -----------    -----------
                                                           2,654,227        814,484        495,500      3,964,211
                                                         -----------    -----------    -----------    -----------

Operating loss before other expenses
    and provision for income taxes                        (2,469,992)      (642,899)      (495,500)    (3,608,391)
Other expenses                                                     0              0              0
                                                         -----------    -----------    -----------    -----------
                                                                                                                0
Loss before provision of income taxes                     (2,469,992)      (642,899)      (495,500)    (3,608,391)
Provision for income taxes                                         0              0              0              0
                                                         -----------    -----------    -----------    -----------
Net loss                                                 $(2,469,992)   $  (642,899)   $  (495,500)   $(3,608,391)
                                                         ===========    ===========    ===========    ===========
</TABLE>



                                      F-22
<PAGE>

ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

On March 30, 2006, the Company engaged the accounting firm of Rosen Seymour
Shapss Martin & Company LLP ("RSSM") as our independent certifying accountants.
On December 20, 2005, Goldstein Golub Kessler LLP, declined to stand for
re-election as the Registrant's independent certifying accountants. The decision
to change accountants was recommended and approved by the Registrant's Board of
Directors. There were no disagreements with the Company's former accountants,
Goldstein Golub Kessler LLP, on any matter of accounting principles or
practices, financial statement disclosure, or auditing scope or procedure.

ITEM 8A. CONTROLS AND PROCEDURES

Our management, with the participation of our principal executive and financial
officer, evaluated the Company's disclosure controls and procedures as of
December 31, 2005. Based upon this evaluation the Company's principal executive
and financial officer concluded that the Company's disclosure controls and
procedures are effective as of that date to ensure the information required to
be disclosed in the reports the Company file or submit under the Securities
Exchange Act of 1934 is recorded, processed, summarized and reported within the
time periods specified in the SEC's rules and forms.

During the year covered by this report, there were no significant changes in the
Company's internal controls over financial reporting that materially affected,
or are reasonably likely to materially affect, these controls.

ITEM 8B. OTHER INFORMATION

None

PART III

Item 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE
WITH SECTION 16(a) OF THE EXCHANGE ACT

Our Bylaws provide that we shall have a minimum of one (1) Director on the Board
of Directors at any one time. Vacancies are filled by a majority vote of the
remaining Directors then in office. The names and ages of the Company's
Directors, Executive Officers, and key employees are as follows:

<TABLE>
<CAPTION>
Name                         Age            Position                             Current Term Expires
<S>                          <C>            <C>                                 <C>
Gerald E Sklar               67             Chairman, President, CEO                    2007
David Young                  60             Vice President, Director                    2007
Anthony K. Miller            50             Director                                    2007
Elaine Prober                87             Director                                    2007
Chen Zai Kun                 71             Director                                    2007

</TABLE>


                                       22
<PAGE>

Each of the Company's Directors is elected at the annual meeting of stockholders
and serves until the next annual meeting and until his or her successor is
elected and qualified, or until his or her earlier death, resignation or
removal. No Compensation is currently paid to Directors for their service on the
Board, although the non-officer Directors are reimbursed for travel and other
direct expenses in attending meetings of the Board.

Set forth below is a summary description of the business experience of each
Director and Officer:

Mr. Gerald Sklar, has been the Company President, Chief Executive Office, and
Chairman of the Board since June 2001. From July 1997 to July 8, 2002, Mr. Sklar
was an Officer and Director of American Benefits Group, Inc., a gem resource
firm located in Florida. From 1989 to 1997, Mr. Sklar was self-employed in the
field of finance. In 1963, Mr. Sklar received a Bachelors of Arts Degree in
Economics from the University of British Columbia located in Vancouver, British
Columbia, Canada.

Mr. David M. Young, has been the Company's Director and Vice-President since
June 2001. From July 1989 to May 2001, Mr. Young was a customer relations
representative at American Benefits Group, Inc. From 1989 to 1998, Mr. Young was
self-employed in the area of marketing.

Mr. Anthony Miller, has been the Company's Director since June 2001. From 1996
to present, Mr. Miller has been the President and a Director of US Crude of
Redland, California. From March 2001 to November 2002, Mr. Miller was a Director
of Southern States Power, an SEC reporting company that is publicly traded on
the OTC Bulletin Board. In 1998, Mr. Miller received a Master of Arts Degree in
Business Administration from Columbia State University located in Metairie,
Louisiana. In 1979, Mr. Miller received a Bachelor of Arts Degree in Business
Administration from Cal-State University located in Long Beach, California.

Ms. Elaine Prober, has been one of our Directors since June 2001. Ms. Prober has
no prior employment history for the last five years.

Chen Zai Kun became a Director on March 17, 2006. From 1952 to present, Chen Zai
Kun was in the Chinese People's Army (Navy). He worked at the military
representative office in Hunan Province, first as a military representative,
then technical specialist, engineer, senior engineer and Vice Chief military
representative (Military Rank: Major General).

Family Relationships

There are no family relationships among our Officers, Directors, or persons
nominated for such positions.

Legal Proceedings

None of our Officers, Directors, or persons nominated for such positions or
promoters or significant employees have been involved in legal proceedings that
would be material to an evaluation of our management.


                                       23
<PAGE>

No Committees of the Board of Directors

We do not currently have a nominating committee or a compensation committee of
the Board of Directors, nor any committees performing similar functions.

In 2003, we established an Audit Committee. Our Audit Committee is currently
composed of the following members: (a) Anthony Miller; and, (b) Gerald Sklar.
Anthony Miller is our Audit Committee Chairperson and our Audit Committee
Financial Expert.

Meetings of the Board of Directors

The Company held irregular meetings of our Board of Directors during the fiscal
year ended December 31, 2005 as follows:

      o     May 20, 2005
      o     July 8, 2005
      o     August 15, 2005
      o     November 16, 2005

Compliance with Section 16(a) of the Securities Exchange Act of 1934 requires
our Directors and Executive Officers and persons who own more than ten percent
(10%) of a registered class of our equity securities to file with the SEC
initial reports of ownership and reports of changes in ownership of our common
stock and our other equity securities. Officers, Directors and greater than ten
percent (10%) shareholders are required by SEC regulations to furnish the
Company's Board of Directors with copies of all Section 16(a) forms they file.
To our knowledge, none of our Officers, Directors or shareholders were
delinquent in any necessary filings under Section 16(a).

In 2004, our Board of Directors adopted a Code of Ethics which applies to the
principal executive officer, principal financial officer, principal accounting
officer or controller and persons performing similar functions. The Company will
provide a copy of our Code of Ethics without charge to any person who sends a
written request addressed to our secretary. A copy of our Code of Ethics was
previously filed as an exhibit to our 10K report for the year ended 2004.

Item 10. EXECUTIVE COMPENSATION

The following table sets forth certain information concerning compensation paid
to or accrued for the benefit of our Officers and Directors. During March 2002,
we affected a one (1) for twenty (20) reverse stock splits. All share and per
share amounts below have been adjusted to give effect to this stock split.


                                       24
<PAGE>

<TABLE>
<CAPTION>

                           Summary Compensation Table

                               Annual Compensation                   Long-Term Compensation
                        ------------------------------------------
                        (1)     (2)       (3)             (4)        Awards         Payouts
                                                                     -----------    --------------------------------
                                                                     Restricted     Securities
Name and Principal                                    Other Annual   Stock          Underlying   LTIP   All Other
Positions              Year    Salary     Bonus       Compensation   Award(s)       Options    Payouts  Compensation
------------------     ----    ------     -----       ------------   -----------    ---------- -------- ------------
                                           (1)            (1)
<S>                   <C>      <C>          <C>          <C>          <C>          <C>          <C>          <C>
Gerald Sklar          2005     $      0     $      0     $      0     $      0     $      0     $      0     $      0
                      2004            0            0            0            0            0            0            0
                      2003            0            0            0            0            0            0            0

David Young,          2005            0            0       34,291      400,000            0            0            0
Director,             2004            0            0            0            0            0            0            0
Vice President        2003            0            0            0            0            0            0            0

Elaine Prober,        2005            0            0            0            0            0            0            0
Director              2004            0            0            0            0            0            0            0
                      2003            0            0            0            0            0            0            0

Robert S. Kergan,     2005            0            0       57,250            0            0            0            0
Chief Financial       2004            0            0       48,000            0            0            0            0
Officer               2003            0            0       30,000            0            0            0            0

Chen Zai Kun,         2005            0            0            0            0            0            0            0
Director
</TABLE>

(1) None of our Officers or Directors owned any unexercised options as of
December 31,2005. No options or stock appreciation rights were granted during
such year or were outstanding at the end of the year 2005, 2004 and 2003.

Stock Option Grants in Last Fiscal Year and Outstanding:

We granted no options to our executive officers or directors during 2005 nor are
there any options outstanding to our executive officers or directors.


                                       25
<PAGE>

Item 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
         RELATED STOCKHOLDER MATTERS

During March 2002, we affected a one (1) for twenty (20) reverse stock split.
All share and per share amounts below have been adjusted to give effect to this
stock split.

The following tables set forth the ownership as of May 3, 2006 by:
        o   Each shareholder known by us to own beneficially more than five
            percent (5%) of our common stock;
        o   Each Executive Officer;
        o   Each Director or nominee to become a Director; and
        o   All Directors and Executive Officers as a group.

Security Ownership of Beneficial Owners:

<TABLE>
<CAPTION>

                                                          Nature of
Title of Class     Name & Address                         Beneficial     Percent of
                   Of Beneficial Owner           Amount   Ownership        Class
                   -------------------        ----------  ----------     ----------
<S>                <C>                        <C>         <C>            <C>
Common Stock       Gerald E. Sklar            14,743,162   Direct             41.19%
                   436 West Broadway
                   New York, New York
                   10012

Common Stock       David Young                 1,060,000   Direct              2.96%
                   5920 Macleod Trail
                   Suite 800
                   Calgary, Alberta T2H 0K2

Common Stock       Elaine Prober                 500,000   Direct              1.40%
                   9 Harwthorn Place
                   Suite #4N
                   Boston MA 02114

Common Stock       Anthony Miller                      0   Direct                 0%
                   27240 Turnberry Lane
                   Suite200
                   Valencia CA 91355

Common Stock       Chen Zai Kun                        0   Direct                 0%
                   Ylyang, Hunan Province
                   China
</TABLE>


Beneficial ownership is determined in accordance with the rules of the SEC and
includes voting and investment power. Under SEC rules, a person is deemed to be
the beneficial owner of securities which may be acquired by such person upon the
exercise of options and warrants or the conversion of convertible securities
within 60 days from the date of which beneficial ownership is to be determined.
Each beneficial owner's percentage ownership is determined by dividing the
number of shares beneficial owned by that person by the same number of
outstanding, increased to reflect the beneficially-owned shares underlying
options, warrants or other convertible securities included in that person's
holdings, but not those underlying shares held by any other person.

<TABLE>
<CAPTION>
<S>                <C>                        <C>                             <C>
Common Stock       All directors and          16,303,162                      45.54%
                   Executive officers
                   as a group.
</TABLE>


                                       26
<PAGE>

The shareholders named in the tables have sole or shared voting and investment
power with respect to the shares indicated as beneficially owned. Except as
otherwise noted herein, we are not aware of any arrangements which may result in
a change in our control.

None of our Officers, Directors, key personnel or principle stockholders is
related by blood or marriage.

Item 12. CERTAIN RELATIONSHIP AND RELATED TRANSACTIONS

Loan payable to stockholders consists of working capital loans to the Company
from the chief executive officer, and majority stockholder. The loan does not
bear interest and the stockholder has indicated that he will not seek repayment
prior to January 1, 2007.

During 2003, the Chief Executive Officer and majority stockholder converted
$684,545 in loans into 4,563,649 shares of the Company's common stock. The
shares were valued at their fair market value at the date of agreement.

During 2004, the Chief Executive Officer and majority stockholder converted
$2,400,000 in loans into 3,934,426 shares of the Company's common stock. The
shares were valued at their fair market value at the date of agreement.

During 2005, shares issued to related parties pursuant to consulting and other
service agreements were as follows:

                   In the name of       Issued            Value
---------------------------------------------------------------
                   Anthony Sklar        650,000     $   294,750
                   Samantha Fryer       500,000     $   246,900
                   David Young        1,000,000     $   400,000
                   Lisa Young           100,000     $    24,000
---------------------------------------------------------------
                   Total              2,250,000     $   965,650
===============================================================

In addition, Michelle Sklar, received payment of $38,010 in 2005 for consulting
fees.


                                       27
<PAGE>

Item 13. EXHIBITS AND REPORTS

A.  Exhibits

Exhibit No.    Description
----------     ------------

3.1.1    Articles of Incorporation of Winmax Trading Group, Inc., dated
            September 26, 1996*

3.1.2    Amendment to the Articles of Incorporation of Winmax Trading Group,
            Inc. dated January 27, 1997*

3.1.3    Amendment to the Articles of Incorporation of Winmax Trading Group,
            Inc. dated October 6, 1999*

3.1(i)   Amendment to the Articles of Incorporation of Winmax Trading Group,
            Inc. dated October 18, 2002**

3.1(ii)  Amendment to the Articles of Incorporation of Winmax Trading Group,
            Inc. dated January 20, 2006***

3.2      Bylaws of Winmax Trading Group, Inc., and Amendment*

10.1     Limited Partnership Agreement Between Winmax Trading Group, Inc. as
            General Partner and the Limited Partners in the Winmax Alpha Fund
            Limited Partnership*

10.2     Assignment Agreement with Stone and Woods Corporation

10.3     Share Purchase Agreement from Global Gemstone & Jewelry Inc.*

10.4     Agreement with Thomas Meeks*

10.5     Consulting Agreement with Samantha Fryer

10.6     Consulting Agreement with MJD Corp.

10.7     Consulting Agreement with Anthony Sklar

10.8     Consulting Agreement with Gioacchino Bonsangue

10.9     Agreement with General Research GmgH

16.1     Letter on change of Auditors ***

16.2     Letter on change of Auditors ****

31.1     Certification of Chief Executive Officer required by Rule 13a-15(e)
            Pursuant to Section 302.

31.2     Certification of Chief Financial Officer required by Rule 13a-15(e)
            Pursuant to Section 302.

32.1     Certification of Chief Executive Officer Pursuant to 18 U.S.C.
            Section 1350 Adopted Pursuant to Section 906.

32.2     Certification of Chief Financial Officer Pursuant to 18 U.S.C.
            Section 1350 Adopted Pursuant to Section 906.


* Denotes previously filed exhibits and incorporated herein by reference.
** Filed as an exhibit to Form 8-K on October 28, 2002 and incorporated herein
by reference.
*** Filed as an exhibit to Form 8-K on June 14, 2004 and incorporated herein by
reference.
**** Filed as an exhibit to Form 8-K on March 31, 2006 and incorporated herein
by reference.



                                       28
<PAGE>

Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

      The aggregate fees billed by our former and current independent auditors,
Goldstein Golub Kessler LLP (GGK) and Rosen Seymour Shapss Martin and Company
LLP (RSSM) for each of our last two fiscal years are as follows:

                                             2005         2004
                                          ----------   ---------

Audit Fees
GGK                                       $ 15,000.    $ 30,000.

RSSM                                        63,500.           0.

Tax Fees                                         0.           0.

All Other Fees                              27,500.      38,362.
                                          ---------    ---------

                                          $106,000.    $ 68,362.
                                          =========    =========

      The fees labeled as all other fees above constitute fees for interim
review of financial statements. Prior to the engagement of Goldstein Golub
Kessler LLP, our Board of Directors considered whether the provision of the
financial information systems design and implementation and all other non-audit
services was compatible with maintaining the accounting firm's independence. Our
Board of Directors recommended Goldstein Golub Kessler LLP be engaged to audit
our consolidated financial statements for our fiscal year ended December 31,
2004. Rosen Seymour Shapss Martin and Company LLP performed the audit for our
consolidated financial statement for fiscal year ended December, 31, 2005.



                                       29
<PAGE>

                                   SIGNATURES


In accordance with Section 13 or 15(d) of the Exchange Act, the Registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

WINMAX TRADING GROUP, INC.
(Registrant)

By:  /s/ Gerald E. Sklar              /s/ Robert S. Kergan
     ---------------------            ---------------------
     Gerald E. Sklar, President,      Robert S. Kergan, Chief Financial Officer,
     Chief Executive Officer,         and Principal Accounting Officer
     Date:    June 23, 2006           Date:    June 23, 2006


In accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the Registrant and in the capacities and on the
dates indicated.

By:  /s/ Gerald E. Sklar
     -------------------
     Gerald E. Sklar, President,
     Chief Executive Officer,
     Date:    June 23, 2006

By:  /s/ David Young
     ---------------
     David Young, Vice President, Director
     Date:    June 23, 2006

By:  /s/ Anthony Miller
     ---------------
     Anthony Miller, Director
     Date:    June 23, 2006

By:  /s/Elaine Prober
     ---------------
     Elaine Prober, Director
     Date:    June 23, 2006

By:  /s/ Chen Zai Kun
     ---------------
     Chen Zai Kun, Director
     Date:    June 23, 2006


                                       30