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: March 31, 2008
  [ ]
TRANSITION REPORT UNDER SECTION 13 OR 15(d) F THE SECURITIES EXCHANGE
ACT
   For the
transition period from __________ to ___________
 
 Commission
file number: 000-52983
     (Name of
small business issuer as specified in its charter)
   New
      York
                4814
                01-0671426State
      or Other Jurisdiction of Incorporation
                  of
      Organization
                Primary
      Standard
                  Industrial
      Code
                (I.R.S.
      Employer Identification No.)
  Ron
Kallus, CEO
 2 Ingrid
Road
 Setauket,
NY 11733-2218
 Tel:
631-458-1120
  Securities
registered pursuant to Section 12(b) of the Exchange Act:
 None
 
 Securities
registered pursuant to Section 12(g) of the Exchange Act:
 Common
Shares par value  $.0001 per share
  Check
whether the Issuer is not required to file reports pursuant to Section 13 or
15(d) of the Exchange Act o
  Check
whether the Issuer (1) filed all reports required to be filed by Section 13 or
15(d) of the Exchange Act during the past 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been subject
to such filing requirements for the past 90 days. Yes [X ] No [  ]
 Check if
disclosure of delinquent filers in response to Item 405 of Regulation S-B is not
contained in this form, and no disclosure will be contained, to the best of the
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 [ X ]
  Transitional
Small Business Disclosure Format (Check One): Yes [ ] No: [ X ]
  Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). Yes X   No
  Issuer’s
revenues for the fiscal year ended March 31, 2008 was
$15,840.
 As
      of June 25, 2008  the number of shares outstanding of the
      company's $.0001 par value common stock was 6,434,000.  Aggregate
      market value of the voting stock held by non-affiliates of VGTel, Inc. was
      approximately $20,000. The estimate is based on the offering price of
      $0.025 per share and 800,000 shares held by non-affiliates.
 
 Form
10-KSB Index
  PART
      IItem 1.
                Description of
      Business
                2Item 2.
                Description of
      Property
                11Item 3.
                Legal
      Proceedings
                11Item 4.
                Submission of Matters to a Vote
      of Security Holders
                11PART
      IIItem 5.
                Market for Common Equity and
      Related Stockholder Matters
                11Item 6.
                Management’s Discussion and Analysis or Plan
      of Operation
                11Item 7.
                Financial
      Statements
                F-1-F-8Item 8.
                Changes in and Disagreements with
      Accountants on
                  Accounting and Financial
      Disclosure
                14Item 8A.
                Controls andProcedures
                14Item 8B.
                Other
      Information
                14PART
      IIIItem 9.
                Directors and Executive Officers
      of the Registrant
                15Item 10.
                Executive
      Compensation
                16Item 11.
                Security Ownership of Certain
      Beneficial Owners and Managementand Related Stockholder
      Matters
                17Item 12.
                Certain Relationships and Related
      Transactions
                17Item 13.
                Exhibits
                17Item 14.
                Principal Accountant Fees and
      Services
                17Signatures
                18Financial
      Statements
                F-1-F-8
     1
  PART
I
   Item
1: Description of Business
  
 We are a
development stage company currently testing a newly developed telemarketing
campaign product called Global Messaging Gateway (GMG). This product is designed
to enable a single User of the System to set up a telemarketing campaign to
distribute messages to bulk lists of recipients in the medium of text, voice,
Fax or multimedia. Messages can be delivered from one control center (one
location) to thousands of clients anywhere in the world simultaneously using the
internet instead of traditional telephone equipment.
  The GMG
system is a cost effective alternative to the current traditional telemarketing
campaign products that distinguishes itself in several ways, including, fixed
equipment costs, per message usage costs, and personnel costs to drive the
campaign. The current traditional telemarketing tools functions on actual
special call-center equipment, with human agents behind each call, which sets
the cost per call to a significantly higher level than the cost associated with
the same call using the GMG product. The GMG product utilizes the internet
instead of physical phone lines and several concurrent campaigns can be
administered by a single user.
  In order
to send the Voice messages to the destinations over the internet, we use the
Voice Over Internet Protocol (VOIP) technology, which allows us to stream the
voice message on the internet, in a similar way it is done over the regular
phone line. The main difference is that the voice is being converted from analog
signal to digital, and compressed in order to use as little space as possible on
the internet. We don’t provide VOIP services; we are using VOIP technology to
transmit the voice messages on the internet network.
  The GMG
System's cost structure allows a User to initiate and control such a campaign
from the Company's website at www.vgtel.com in
which we charge the customer only for completed calls at a very attractive rate.
As an example, we plan to charge for a US domestic call $0.03 this charge
includes the dialing and delivering the message. We do not charge for line or
equipment charges.
   The
actual dialing servers are located in different parts of the country, allowing
off-loading the physical phone infrastructure preventing possible congestion, or
power interruption which can interfere with any running telemarketing
campaign.
  The chart
below illustrates the cost comparisons between (1) Call Centers using
traditional telemarketing equipment based on report published by Beagle Research
Group, LLC March 2006 (2) Call Centers using first generation VOIP products,
based on report published in Business Communications Review November 2006. and
(3) Our GMG product. See footnotes below:
  500
      lines system
                Traditional
                  Call Center1
                Existing
      VOIP
                  Telemarketing
      Tools
                  Cisco
      Enterprise2
                GMG (5)
                  SystemEquipment
                Call
      Center System,
                  Client
      License
                $1500
      per Agent
                  $750,000
                $865
      per Agent
                  $432,500
                NoneBase
                  Contact
                  Center
                One
      time cost for CRM licensing for
                  concurrent
      operation
                $600
      per Line
                  $300,000
                $1,100
      per Line
                  $550,000
                NoneMonthly
                  Fixed
      Costs
                Leased
      from Service providers
                $500
      per T1
                  $10,000
                $100
      per Mb
                  $1,700
                NoneCalls
                Charge
      per Min.
                $0.05
                $0.05
                $0.03
  1Zachary
A. Barnes, Bowie State University Maryland In Europe May 2005 in article
entitled: Is Implemetation Of Voice Over Internet Protocol (Voip) More
Economical For Businesses With Large Call Centers. Verizon Cost of each line is
$26.00. Toll free number is $5.00. According to www.vonage.comfor
small businesses the following is a break down of monthly recurring costs. First
line is $49.99. Each additional line is $44.99. Toll free number is
$5.00.
  2 Small
Footprint, Big Results,The advantages of on-demand call centers — things your on-premise call
center supplier never told you, and probably won’t, Published by Beagle Research
Group, LLC March 2006, Table 6 Page 11 “200 user premises based call center cost
breakdown”
  3IP
Contact Centers Go Beyond The Basics: Published in Business Communications
Review November 2006. Article authored by Michael B. Hommer, Robert Smithers.
Table 2 Page 6 "Pricing of key components".
  4 Zachary
A. Barnes Bowie State University Maryland In Europe May 2005 in article entitled
Is Implemetation Of Voice Over Internet Protocol (Voip) More Economical For
Businesses With Large Call Centers? Barnes states VoIP service can save a
significant amount of money by reducing infrastructure and monthly maintenance
expenses as well as providing telephone service at significantly lower rates.
From the data analyzed a company could save 76.2% on their outbound calling
expenses by using VoIP technology.
  5 The
only charge that we plan to charge direct users of our system is $0.03 per
successful US domestic call which includes placing the call and delivering the
message. No additional fees will be charged. Since Platin, our only customer
presently, is currently testing our system for their clients and providing us
with helpful feedback to improve our system, we have agreed to a special
arrangement during the testing and feedback phase in which we charge Platin a
monthly per line cost of $3.0 plus a usage fee of $0.012 per min for each
successful call delivered.
  The
Global Messaging Gateway (GMG) is currently the first and only product of the
Company. The Company launched its website in January 2006 at its domain
location, www.vgtel.com and currently has one client who is using the GMG system
for telemarketing campaigns. We have not recognized any significant revenues
from this product to date and we are negotiating additional contracts for our
services with other clients.
  2
   Our
Products and Services:
  PHASE I
  During
the next 12 months, which constitutes the first phase of our operation, we plan
to focus on three applications of the GMG system:
  (1)
                  GMG
      Commercial Telemarketing Services,(2)
                  GMG
      Alert Notification System
  (3)
                  GMG
      Global Franchise Partners
  GMG Commercial Telemarketing
Services:
  Our
website was established in January 2006 at our domain location, www.vgtel.com
and is currently operational and capable of serving a few selected clients while
the Company's GMG system is being tested. Since Feb. 2006 we have been providing
commercial telemarketing services for one client who is the only current User of
our system.   In June
2008 our website was upgraded to allow Multilanguage support, currently it
support English and Hebrew, while Russian will be the next language to be
supported. During this testing phase, our development
team  continue to add features, fix problems and integrate new customer
driven ideas. Each new feature is being integrated into the commercial operating
environment and gets tested immediately under real commercial
conditions.
  Our only
current customer is Platin Ltd. located in Israel. Platin is a Public Relations
(PR) company which handles many clients, from various market segments mostly
located in the State of Israel. Their largest clients that make use of our
telemarketing services are supermarkets, Credit cards providers, Non-Profit
Charity organizations, and Pets’ food suppliers. We provide our services to
Platin, and although the campaigns are being conducted for Platin's clients, we
only have a direct relationship with Platin who subcontracts our services for
use by their clients. We do not have any relationship with their clients who are
using our system. Therefore Platin is our only client to date and Platin and
their clients are located in the State of Israel. Consequently, we are currently
only doing business in Israel.
  Platin
Ltd., is a related party. Israel Hason is the Chief Marketing Officer of our
Company and a Director. Mr. Hason is also the managing partner and principal
shareholder of Platin Ltd. Israel. Mr. Hason has agreed to recuse himself from
any corporate decision relating to Platin Ltd business relationship with VGTel,
Inc.
  The
telemarketing activity generated from Platin's clients is administered by Platin
on behalf of their clientele, consisting of providers of products and services
and is used for the purpose of announcing, exposing, alerting and informing
prospective consumers to their products and services including discounts, sales,
promotions and special deals. Platin is also using our GMG system on behalf of
their political clients to conduct campaigns for political candidates in the
State of Israel.
  We
currently depend on Platin, Israel for our total revenues.   We
believe they will remain our only client until the GMG product is further
developed and refined and ready to serve many clients.   We
started negotiating with other companies in Kazakhstan, Turkey and Romania
anticipating  these new clients to start producing revenue for us during
the next qtr.
 . GMG
Alert Notification Services.
   We identified
four possible types of alert notification areas that our GMG system will be
capable of accommodating:
  a.
                  Weather:
      The service can be used by counties and other local organizations to alert
      residents on evacuation requirement and traffic
  directions.
   b.
                  Terror:
      This service can be used by Homeland security and similar organizations to
      address residents in specific areas to stay away from a suspected terror
      threat.
   c.
                  Industrial:
      Any large processing plant (Chemical, Nuclear, and Refinery) can use the
      service to alert residents around the plant of any event which might cause
      harm to their life or property.
   d.
                  Schools:
      Currently schools are using traditional alert systems to notify parents or
      students of changes in school schedules during severe weather or other
      school agendas. These services can be accommodated by our GMG system at
      significant reductions in cost and
time.
  In
parallel with the on going testing and development effort for our GMG
telemarketing campaign product, which is currently being used by Platin, we
recently undertook the initiative to begin developing a special GMG notification
application for the K-12 Educational sector.  This
development required more effort and was put aside until additional funding will
be available to take this product into the next step
  GMG Global Franchise
Partners:
  We plan
to establish global partners to operate franchises of our GMG system. The global
target market consists of many countries each has its own regulations and local
methods of operating their businesses. Our goal is to establish 4 franchises
within 18 months, and thereafter slowly build additional franchises. Using our
personal and commercial network we have identified and contacted specific
entities in the following countries:   Kazakhstan,
Turkey, Romania , Israel, and Russia.Each one of them
expressed an interest in using the GMG system for their clients. All of these
are small to medium companies which currently use traditional PSTN which stands
for Public Switched Telephone Network. It is the same thing as POTS (Plain Old
Telephone System) and is simply the worldwide telephone network referring to the
old phone system which uses analog data. In contrast, VoIP uses digital data.
Due to competition, most of them cannot raise the price for the services, and
looking to lower the cost to stay in business. The GMG system provides this
opportunity with no upfront investment.
  The
Company plans to have the domestic market handled directly through its own
office, while each of the foreign operations will be run by a local franchiser
under its general framework.
  Although
we are in discussions with certain entities regarding our franchise opportunity,
to date we have not entered into any franchising contracts with any of these
entities. Nor have we decided on the terms of each contract which will be
determined in accordance with the demand of our GMG system.   We
expect that it will take one year for each franchise to get itself
established.
   3
 Phase II
  VGTel’s
Products & Services:
  Depending
on our ability to raise additional funds, we anticipate our Phase II of our
Products and Services will be implemented in 2008-2009.
  Having
built the VOIP based server, and the application builder tool, the Company will
offer a variety of additional services such as:
  1. Tele-Shir
  The
service enables customers to select a greetings occasion, and choose, from a
list of played tunes, the one he would like to be sent. Then the system allows
the customer to record his own greetings, set time+date and a phone number to
dial. All the information is stored in a data base, and retrieved on time to be
routed to the desired destination.The system support tunes for the following
occasions:
  ·
                  Greeting
      to a loved one (Male or Female)
  · General Salutations
Get well
 · Holiday
greetings
 ·
Birthday
 ·
Wedding
 · Popular
Songs
 · Patriotic
Songs
  2. Dating Service
  This is a
platform for single people to find a matching date. Each subscriber will receive
a mailbox in which he describes himself, indicating his preferences, and get
permission to listen to other mail-boxes according to his specific interest.
Once he finds an interesting match, he can contact this person directly to
schedule a date. There are
many options for subscribing to the service, and all rendered services are
prepaid using credit cards.
  3. 
 Fund
Raising
  This is a
complete telemarketing support tool, to help candidates who are running for any
elective position, to gather public awareness and support for their
candidacy.
  4. Voice Mail
Greetings
  The
system presents the user with a large selection of greetings, in many
categories, following the user selection, the system will download the selected
greeting into the user voice-mail, thus each caller who will be forwarded to the
user voice-mail will hear this greeting.
  5. Evangelist
  Allow
many followers to listen to a preacher of their choice. The system stores a
daily preaching from various preachers, and each user can listen to his
preferred preacher. The same service can be provided for any group of people who
like to listen to their leaders.
  6. Medical advice
  This
service provides professional medical advice by the best known physicians, for
many common medical conditions, and offers special option for new questions to
be added, when a specific condition cannot be found.
  7. Short Dial
  Allows
service oriented companies to have a short 4-6 digit access number which can be
used by their customer to reach their main customer support center with a quick
easy to remember number.
 The
Market for our Products & Services:
  Our
target market consists of businesses, non-profit organizations, and political
organizations which employ call centers, including telemarketing firms, and any
person or entity who seeks to reach out to sizable audiences, quickly,
efficiently utilizing the most cost effective approach via voice or
fax.
  The VGTel
system is configured to achieve global coverage using the internet as its core
infrastructure facility which is easy to reach from almost any place, and free
from most regulatory agencies that regulate the use of the standard telephone
facilities. The primary products sold by VGTel consist of the capability to
disseminate Voice, Text, Fax, Multimedia, messages to a vast number of clients
simultaneously at a fraction of the cost of traditional mass marketing
campaigns.
  In
today’s information driven society, where most people don’t have to be at home
or in their office to be reached, and have less and less time to devote for any
one interesting issue, the short, direct to the point marketing message, will be
the best way to attract the attention of any potential global customer. The
immediate and direct way to convey commercial information to the end user via
telecommunications means dramatically increases the use of telemarketing as the
main tool to raise the awareness and promoting products and
services.
  This is a
significant market which will dramatically grow when the Chinese and Indian
economies start targeting their domestic market with middle class consumer
products.
  The
growing numbers of communities which are threatened by natural or man-made
disasters, along with the availability of more sophisticated early warning
sensors, create a significant demand for a method to convey warnings and alert
notices to the affected neighborhoods in a timely manner in order to enable an
orderly, and safe evacuation.
  Many
Governments, States, Counties, Cities, and commercial plants spend millions of
dollars to maintain early-warning calling systems to support their
constituencies. The VGTel system provides an efficient and cost effective
alternative over new and existing systems in which a substantial portion of the
costs associated with maintaining the system capabilities is currently being
spent on leasing/renting phone lines from the local telecom
providers.
  Additional
market segments which we plan to target, are businesses or organizations having
a need to provide information to their respective group members as
follows:
   Business Non-Profit
Education
  Business
                  Non-Profit
                  EducationCorporate
                  Church
                  CampsUtilities
                  Clubs
                  ScoutsTemp
      Help
                  Synagogues
                  UniversitiesRetail
                  Home
      Owner's Assoc.
                  SchoolsService
      Providers
                  Neighborhood
                  Day-CareHospitals
                  Political-Elections
   4
   2. Distribution Methods of the
Products or Services.
   Our only
current customer is Platin Ltd. located in Israel. Platin is a Public Relations
(PR) company which handles many clients, from various market segments mostly
located in the State of Israel. Their largest clients that make use of our
telemarketing services are supermarkets, Credit cards providers, Non-Profit
Charity organizations, and Pets’ food suppliers. The telemarketing activity
generated from Platin's clients is administered by Platin on behalf of their
clientele, consisting of providers of products and services and is used for the
purpose of announcing, exposing, alerting and informing prospective consumers to
their products and services including discounts, sales, promotions and special
deals. Platin is also using our GMG system on behalf of their political clients
to conduct campaigns for political candidates in the State of Israel. We provide
our services to Platin, and although the campaigns are being conducted for
Platin's clients, we only have a direct relationship with Platin who
subcontracts our services for use by their clients. We do not have any
relationship with their clients who are using our system. Therefore Platin is
our only client to date. In February 2006, Platin engaged our services for the
upcoming election in Israel which was scheduled for Mar.28.2006. Platin has been
using our System for both political campaigns and for commercial telemarketing
services they provide to a variety of their clients every since.
   We
currently depend on Platin, Israel for our total revenues. We believe they will
remain our only client until the GMG product is further developed and refined
and ready to serve many clients. We anticipate that we will reach this stage in
August 2008, when we will slowly start adding a few additional customers. We
believe that by December 2008 our product will be well enough refined and
developed with many additional features and capabilities and will be ready to
serve unlimited number of customers requiring telemarketing
services.
   Platin
Ltd., is a related party. Israel Hason is the Chief Marketing Officer of our
Company and a Director. Mr. Hason is also the managing partner and principal
shareholder of Platin Ltd. Israel. Mr. Hason has agreed to recuse himself from
any corporate decision relating to Platin Ltd business relationship with VGTel,
Inc.
   Our
objective is to develop multiple markets for our products and services. We plan
to implement a marketing plan to enable us to attract Users to our GMG
System.
   Our Marketing
Plan:
   Our
target market consists of supermarkets, discount chains, vendors of services,
real estate brokers, political candidates, organizations, social planners,
schools, municipalities, and other providers of alerts, messages, telemarketing,
warnings, etc.
   We plan
to compile lists of targets consisting of:
  ·
                  Political
      parties for national, and local offices of
  government
   ·
                  Schools
      Charity
   ·
                  collecting
      organizations
   ·
                  Providers
      of products such as supermarkets, chain
stores,
   ·
                  Public
      Relations Companies on behalf of their clients Companies currently using
      telemarketing campaign products.
   ·
                  Companies
      currently providing telemarketing campaign
  products.
   Beginning
in December 2008, we plan to announce our services using our GMG system to the
aforementioned targets in the US, Canada and Israel. We plan to target customers
that will use our system to support their already established clients who will
provide us with a quicker market penetration. Additionally we plan to target
direct users of our system to use the system for their own
purposes.
   In
General, we plan to charge a lower rate for our services to wholesale providers
who will use our system for their clients. We plan to charge a higher rate for
direct clients who are direct users of our system. As of this date, we have not
yet determined the actual fee structure that we will charge, as we believe it
will determined in accordance with the market and what our clients will be
willing to pay.
   In
February 2008 we started negotiating  contracts with principals of
the few franchised locations as detailed above under the sub-heading
"Global Franchise Partners", which represent different market opportunities,
providing the best learning ground for future expansion of the
business.
   3. Status of any publicly announced
new Product or Service.
   No new
product has recently been publicly announced.
   4.
Competition: business conditions, competitors, and methods of
competition.
   Management
is not aware of any other internet based call-center with similar technology. We
believe the uniqueness of this service positions VGTel to an excellent starting
point in becoming a leading global service provider of a powerful Web-based
marketing tool. We anticipate that the cost effectiveness, ease of use, coupled
with unlimited capacity will make GMG a popular tool within a short period of
time.
  We have
applied for a provisional patent on the core software engine which
runs the business process of the VGTel System and platform, and plan to
embark on a PR offensive to establish our name in the minds of entities
operating in our target industry. We anticipate that being first to present this
concept will give us an advantage over competitors who have not yet begun to
exploit this market. We do anticipate that we will nonetheless face extensive
competition from a variety of internet providers and from traditional
telemarketing organizations as well. In addition, nearly all established firms
that choose to compete with us will have greater brand recognition, longer
operating histories, larger customer bases and significantly greater financial,
marketing and other resources than we will have. New technologies and the
continued enhancement of existing technologies may also increase competitive
pressures upon us.
   5
  5. Sources and Availability of raw
materials and the names of principal suppliers.
  The
Company does not use raw materials in its products and services.
  The
Company has entered into various relationships with third party vendors. (See
Management Discussion & Analysis, under the sub heading Contracts,
Agreements and Relationships).
  6. Dependence on one or a few
customers.
  Our only
current customer is Platin Ltd. located in Israel. Platin is a Public Relations
(PR) company which handles many clients, from various market segments mostly
located in the State of Israel. Their largest clients that make use of our
telemarketing services are supermarkets, Credit cards providers, Non-Profit
Charity organizations, and Pets’ food suppliers. The telemarketing activity
generated from Platin's clients is administered by Platin on behalf of their
clientele, consisting of providers of products and services and is used for the
purpose of announcing, exposing, alerting and informing prospective consumers to
their products and services including discounts, sales, promotions and special
deals. Platin is also using our GMG system on behalf of their political clients
to conduct campaigns for political candidates in the State of Israel. We provide
our services to Platin, and although the campaigns are being conducted for
Platin's clients, we only have a direct relationship with Platin who
subcontracts our services for use by their clients. We do not have any
relationship with their clients who are using our system. Therefore Platin is
our only client to date. On January 15, 2006, Platin engaged our services for
the upcoming election in Israel which was scheduled for March 28, 2006. Platin
has been using our System for both political campaigns and for commercial
telemarketing services they provide to a variety of their clients every
since.
  We
currently depend on Platin, Israel for our total revenues. We believe they will
remain our only client until the GMG product is further developed and refined
and ready to serve many clients. We anticipate that we will reach this stage
in August 2008, when we will slowly start adding a few additional
customers. We believe that by December 2008 our product will be well enough
refined and developed with many additional features and capabilities and will be
ready to serve unlimited number of customers requiring telemarketing
services.
  Platin
Ltd., is a related party. Israel Hason is the Chief Marketing Officer of our
Company and a Director. Mr. Hason is also the managing partner and principal
shareholder of Platin Ltd. Israel. Mr. Hason has agreed to recuse himself from
any corporate decision relating to Platin Ltd business relationship with VGTel,
Inc.
  The
Company budgeted $5,000 for marketing in the next 12 months which will be used
primarily to purchase mailing list of entities in various industries which the
Company plans to target. The Company plans to use its GMG System to broadcast to
selected target lists information about our services in hope of attracting users
to the GMG System.
  The
Company objective is to have a diversified clientele in many sectors across a
broad range of industries and in various geographical locations. We will need to
raise substantial funds to enable us to aggressively market our product through
public relations firms and massive advertising. There is no assurance we will be
successful in raising additional funds.
   7. Patents, trademarks, licenses,
franchises, concessions, royalty agreements, or labor contracts, including their
duration.
   The
Company has applied for a Provisional Patent on its core technology
process.
  Provisional
Patent preserves the rights to apply for a regular patent within 12 months,
while recognizing the application’s date to the date in which the provisional
patent application was submitted. Thus, we will get a priority on any one who
will apply for a similar patent during this year. Failure to file for the full
patent protection within the one year period terminates the priority rights
acquired through the provisional patent application. The cost of applying for a
full patent is approximately $3,500. Filing for a full patent does not insure
that a patent will be granted.  The Company has not filed for a full
patent, consequently the provisional patent has expired.   The Company
plans to file for a full patent when it is successful in raising additional
funds.
   8. The need for government approval
of principal products or services.
  Our
business is subject, to privacy laws and regulations enacted in the United
States and other jurisdictions around the world that govern the collection and
use of personal data of our customers and our ability to contact our customers
and prospective customers, including through telephone or facsimile. We are
subject to U.S. federal privacy regulation, including the federal Telemarketing
Sales Rule with its “do not call” and “do not fax” provisions, and state privacy
regulations. Many states have laws and regulations regarding telemarketing laws,
telephone solicitation laws, including “do not call” and “do not fax”
regulations. Our Service Agreements with our clients require our clients to
comply with all relevant privacy and telemarketing sales rules and further
require they indemnify us against any regulatory actions caused by their breach
of these laws. Additionally we require for our clients using our GMG product for
telemarketing campaigns to provide us the recipient list for pre-screening to
identify prospective recipients whose name appear on the "do not call" and "do
not fax" list which we automatically delete. Violations of certain provisions of
these laws by our clients will also limit our ability to accept certain clients
for our services. Additionally, the United States and other jurisdictions are in
the process of considering passing additional laws and regulations to protect
the privacy of customers and prospective customers. In light of these and any
future laws and regulations, there can be no assurance that we will be able to
continue to market our services efficiently.
   9. Technology:
  We use
commercially available software, as well as our own developed proprietary
software. Our systems combine our proprietary technologies and commercially
available, licensed technologies. Our current strategy is to license
commercially available technology to augment internally developed solutions. Our
Internet content delivery will be provided by a variety of servers.
  10. Employees:
  The
business of VGTel, Inc. will be managed by Mr. Kallus, our CEO. Our future
success depends in large part upon our ability to attract and retain highly
qualified employees. Competition for such personnel is intense, and there can be
no assurance that we will be able to retain our senior management or other key
employees or that we will be able to attract and retain additional qualified
personnel in the future.
   6
  Risk
Factors
  An
investment in our common stock involves a number of very significant risks. You
should carefully consider the following risks and uncertainties in addition to
other information in this prospectus in evaluating our Company and its business
before purchasing shares of our Common Stock. Our business, operating results
and financial condition could be seriously harmed due to any of the following
risks. The risks described below are all of the material risks that we are
currently aware of that are facing our Company. You could lose all or part of
your investment due to any of these risks. You should therefore not invest in
our securities unless you are prepared to lose your entire
investment.
   RISKS
RELATED TO OUR BUSINESS
  1.
WE HAVE A LIMITED OPERATING HISTORY ON WHICH YOU CAN BASE YOUR EVALUATION OF OUR
PEFORMANCE. WE ARE CURRENTLY TESTING OUR ONLY PRODUCT WITH ONE COMMERCIAL CLIENT
WHO IS USING OUR SYSTEM ON A MINIMAL BASIS GENERATING MINIMAL REVENUES. THERE IS
NO SUFFICIENT VOLUME OF MESSAGES BEING PROCESSED TO DETERMINE THE FULL
FUCTIONALITY OF THE SYSTEM. WE CURRENTLY HAVE NO CONTRACTS FOR OUR SERVICES. IT
IS HIGHLY LIKELY THAT OUR GMG SYSTEM MAY FAIL TO BE A VIABLE SOLUTION TO
TRADITIONAL TELEMARKETING PRODUCTS AND MAY FAIL TO ATTRACT CUSTOMERS, IN WHICH
CASE OUR BUSINESS WILL FAIL.
  We are a
development stage company with minimal operating history. On January 18, 2006
the Company purchased a newly developed telemarketing campaign product called
"Group Messaging Gateway" (GMG) which the Company is currently testing with one
commercial client who is using our system minimally. This client is Platin Ltd.,
and is a related party. Israel Hason is the Chief Marketing Officer of our
Company and a Director. Mr. Hason is also the managing partner and principal
shareholder of Platin Ltd. Israel. There is insufficient volume of messages
currently being processed to enable us to determine the systems functionability
with a normal commercial load. The Global Messaging Gateway (GMG) is currently
the first and only product of the Company. We have not yet recognized any
significant revenues from this product. We have not entered into any contracts
for our services with clients. As a result, the product has not yet undergone
rigorous testing by many clients. There is no assurance that the GMG product
will become a viable alternative to replace the traditional telemarketing
campaign products.
  Furthermore,
the product is new to the market and the likelihood of our success must be
considered in light of the problems, expenses, difficulties, complications and
delays frequently encountered by a small developing company starting a new
business enterprise and the highly competitive environment in which we will
operate. Since we have a very limited operating history of marketing our
services to the public over the Internet, we cannot assure you that our business
will be profitable or that we will ever generate sufficient revenues to meet our
expenses and support our anticipated activities.
  If we do
not effectively manage these risks, we will go out of business. To address these
risks, we must, among other things:
  ·
                  Increase
      the number of messages being tested by expanding the messages of our only
      customer Platin, or by attracting additional customers willing to test our
      system with their clients.
  ·
                  Continue
      to develop the GMG in accordance to feedback we receive from testing
      customer.
   ·
                  Provide
      superior customer service;
   ·
                  Maintaining
      competitive pricing
   ·
                  Continue
      to develop the products in accordance to our customers
    needs.
   Develop
      a clientele for our products
  There are
many challenges we will face in addressing these risks which highlights the high
degree or risk for investors who purchase our securities in this offering. If
our GMG product does not gain market acceptance by many clients, or overall we
are unsuccessful in implementing our business, or in becoming profitable, our
business will fail and you will lose your investment.
  2. OUR AUDITORS HAVE EXPRESSED
SUBSTANTIAL DOUBT ABOUT OUR ABILIITY TO CONTINUE AS A GOING
CONCERN.
  Following
review of our financial statements, our auditors have determined that we do not
have sufficient working capital necessary to be successful and to grow our
business. As a result, our auditors have raised substantial doubt about our
ability to continue as a going concern. According to our auditors, continuation
of our Company as a going concern is dependent upon raising funds and generating
ongoing revenues from our operations. If we a fail to accomplish both, we will
most likely fail and you will lose your investment. We will require a minimum of
$35,000 for the next twelve  months. At the current level of
revenues and expenses, in conjunction with the committed loan from our President
we anticipate we will have sufficient funding to operate for the next six
months. However, we will need to raise substantial funds in order to launch a
broad marketing campaign to attract clients for our product in order to become a
viable business. We cannot offer assurances that any additional funds will be
raised when we require them or that we will be able to raise funds on suitable
terms. If we fail to raise additional funds, if we fail as a business, and you
would lose your investment.
  3.
WE NEED SUBSTANTIAL FINANCING TO EXECUTE OUR BUSINESS PLAN, AND THERE IS NO
ASSURANCE FINANCING WILL BE AVAILABLE. IF WE ARE UNABLE TO RAISE ADDITIONAL
CAPITAL, WE MAY NOT BE ABLE TO CONTINUE OPERATIONS WHICH MAY CAUSE US TO GO OUT
OF BUSINESS.
  We need
substantial additional capital to expand our marketing and sales efforts. Our
current level of income and expenses along with a loan commitment from our CEO
are expected to fund operations for the next six months. However we will need to
raise substantial funds to further develop and market our product to potential
clients which is essential for us to become a viable business. We cannot offer
assurances that any additional funds will be raised when we require them or that
we will be able to raise funds on suitable terms. Failure to obtain such
financing when needed could delay or prevent our planned development and
expansion, which could result in less revenue and less cash to fund operations.
If additional capital is raised through the sale of additional equity or
convertible securities, substantial dilution to our stockholders is likely to
occur which may result in a partial or substantial loss to your investment in
our common stock.
  4.
WE HAVE NOT DEVELOPED ANY EFFECTIVE DISTRIBUTION CHANNELS FOR OUR SERVICES WHICH
ARE NECESSARY TO SELL OUR SERVICES AND GENERATE REVENUES. IF WE DO NOT ATTRACT
SUFFICIENT CLIENTS FOR OUR PRODUCT WE WILL NOT HAVE SUFFICIENT REVENUES TO
SUCCEED WHICH MAY CAUSE US TO GO OUT OF BUSINESS AND YOU MAY LOSE YOUR
INVESTMENT.
  We
currently plan to market our services through personal contacts. In most
instances, we plan to utilize performance demonstrations as part of our sales
process. In addition, our future marketing plans include:
  ·
                  Establishing
      service brand recognition through customers with extensive use of the
      Internet.
  ·
                  Active
      participation in industry trade
shows.
  ·
                  Extensive
      public relations efforts directed at target market trade
      press.
  Our
success will depend, in part, upon our marketing efforts to effectively
establish distribution channels and we may not have the resources or ability to
sustain these efforts or generate any meaningful sales. If we do not generate
sales sufficient to cover our expenses and generate a profit, you may lose your
investment.
   7
   5.
WE DEPEND ON THIRD PARTIES FOR MANY FUNCTIONS. IF THE SERVICES OF THOSE THIRD
PARTIES BECOME UNAVAILABLE TO US, AND WE ARE UNABLE TO REACH SUITABLE
ALTERNATIVE ARRANGEMENTS ON A TIMELY BASIS, WE MAY LOSE CUSTOMERS AS A RESULT OF
THE LAPSE IN OUR SERVICES CAUSED BY THE DELAY IN REACHING A CONTRACT WITH
ALTERNATE PROVIDERS.
   Our
business is materially dependent on third parties supporting the following
operational points: (See also section on "Business" under the subheading" (Our
Current Infrastructure and Setup").
  1.
                  Internet
      Service: Our servers are hosted by Internet Service Providers (ISP). We
      currently use two such providers:GoDaddy (California)
      and
                    ESP
      (Israel)
   2.
                  Interconnect
      - To carry the messages from the internet into the local
      telecommunications network, onto which the end client is
      connected.
  The
number of companies providing the above mentioned services is growing, and we
anticipate that alternative vendors to provide these services will be easily
obtainable. We cannot provide any assurances that the third parties will perform
their contractual obligations adequately. Furthermore, if any of our current
relationships are terminated suddenly and we are unable to reach suitable
alternative arrangements on a timely basis, we may lose customers as a result of
the lapse in our services caused by the delay in reaching a contract with
alternate providers.
  6. THE COMPANY PLANS TO MARKET ITS
PRODUCTS THROUGH THE VGTEL TRADEMARK NAME FOR WHICH THE COMPANY HAS APPLIED FOR
TRADEMARK PROTECTION. ANY COMPETING PRODUCTS MARKETED UNDER A SIMIILAR NAME BY
OUR COMPETITORS MAY RESULT IN COMPROMISING OUR PROTECTED NAME WHICH MAY HAMPER
OUR MARKETING EFFORTS AND CAUSE US TO LOSE CUSTOMERS.
  To the
best of our knowledge the name VGTel is not being used by any commercial entity
in the US. We have conducted an extensive search over the internet, and
registered the name with the US Commissioner for Trademarks as our Service Mark.
However, in the event our trademark name or a name similar to our trademark name
is used by competitors it will confuse our current and potential customers who
wish to obtain our services and end-up getting different service from another
company. One of our marketing schemes is to develop an international network of
franchise partners using our trademark, and any use of the name by another
service provider will disrupt our marketing campaign which will result in our
losing customers. Furthermore, there is no assurance that we will be able to
successfully defend our service mark if contested or infringed upon. If this
occurred, it could devastate our marketing efforts and cause us to lose
customers.
  7.
THE COMMUNICATIONS SERVICES INDUSTRY IS HIGHLY COMPETITIVE AND WE MAY BE UNABLE
TO COMPETE EFFECTIVELY WHICH MAY CAUSE US TO GO OUT OF BUSINESS AND FOR YOU TO
LOSE YOUR INVESTMENT.
  The
communications industry, including Internet and data services, is highly
competitive, rapidly evolving, and subject to constant technological change and
intense marketing by providers with similar products and services. We expect
that new competitors are likely to join existing competitors in the
communications industry, including the market for Voice over Internet Protocol
(VOIP), Internet and data services. Many of our current and future competitors
are significantly larger and have substantially greater market presence as well
as greater financial, technical, operational, marketing and other resources and
experience than we have. In the event that such a competitor expends significant
sales and marketing resources in one or several markets we may not be able to
compete successfully in such markets. We believe that competition will continue
to increase, placing downward pressure on prices. Such pressure could adversely
affect our gross margins if we are not able to reduce costs commensurate with
such price reductions. In addition, the pace of technological change makes it
impossible for us to predict whether we will face new competitors using
different technologies to provide the same or similar services offered or
proposed to be offered by us. If our competitors were to provide better and more
cost effective services, our business initiatives could be materially and
adversely affected resulting in our business failing in which case you may lose
your investment.
  8.
FAILURE FOR OUR COMPANY TO PERFORM FOR OUR CLIENTS MAY RESULT IN REDUCED
REVENUES OR CLAIMS FOR DAMAGES WHICH MAY CAUSE US TO LOSE CLIENTS AND MAY RESULT
IN OUR GOING OUT OF BUSINESS.
  Failures
to meet service requirements of a client could disrupt the client's business and
result in a reduction in revenues or a claim for substantial damages against us.
For example, some of our agreements may have standards for service that, if not
met by us, may result in reduced payments. In addition, because many of our
projects will likely be business-critical projects for our clients, a failure or
inability to meet a client's expectations would seriously damage our reputation
and affect our ability to attract new business. To the extent that our contracts
contain limitations on liability, such contracts may be unenforceable or
otherwise may not protect us from liability for damages. If this would occur it
may devastate our business, and you could lose your investment.
  9.
WE ARE DEPENDENT UPON OUR CHIEF EXECUTIVE OFFICER, RON KALLUS, TO DEVELOP OUR
BUSINESS. IF WE LOSE MR. KALLUS OR IF HE DOES NOT ADEQUATELY DEVELOP OUR
BUSINESS, THEN WE WILL GO OUT OF BUSINESS AND YOU MAY LOSE YOUR
INVESTMENT.
  At the
outset, our success will depend entirely on the ability of Ron Kallus to launch
our business. We do not carry a “key person” life insurance policy on any of our
officers and directors. The loss of Mr. Kallus would devastate our business. At
the present time there are three officers in the company: Ron Kallus our
President and Chief Executive Officer is devoting his full time to operate the
company business while Mr. Hason, our Chief Marketing Officer, is devoting 20%
of his time to develop the marketing strategy and Niva Kallus, Corporate
Secretary is devoting 5% of her time to look over the company operations
ensuring it is done according with the relevant regulations. Ron Kallus is the
only officer devoting his full time to the operations of the Company. Mr. Kallus
will be responsible for all business matters of the Company. In the event that
Mr. Kallus ceases to devote his full time to our business, it will adversely
affect our ability to conduct business and may cause a total loss of your
investment.
  10. OUR PROMOTIONAL AND MARKETING
EFFORTS MAY NOT RESULT IN GENERATION OF ANY REVENUE WHICH MAY CAUSE OUR BUSINESS
TO FAIL AND FOR YOU TO LOSE YOUR INVESTMENT
  If our
promotional and marketing efforts do not attract customers, then we will not
generate any revenue. We intend to target customers that will need our services.
If we do not attract customers through our promotional and marketing efforts,
then it is likely that our business will fail and cause you to lose your
investment.
  11. THE FAILURE OF OUR BUSINESS AND
OUR CUSTOMER SERVICE SUPPORT SYSTEMS TO PERFORM AS WE EXPECT, COULD CAUSE US TO
LOSE CUSTOMERS AND/OR MAKE IT DIFFICULT TO OBTAIN NEW CUSTOMERS, WHICH COULD
RESULT IN REDUCED REVENUES, POSSIBLY CAUSING US TO GO OUT OF
BUSINESS.
  Our
operations support systems are an important factor in our success. Critical
information systems used in daily operations will be used to perform sales and
order entry, provisioning, billing and accounts receivable functions, and cost
of service verification and payment functions. If any of these systems fail or
do not perform as expected, it would reduce our ability to process orders and
provision services, and to bill for services efficiently and accurately, all of
which could cause us to suffer customer dissatisfaction, loss of business, loss
of revenue or the inability to add customers on a timely basis, any of which
could reduce revenues. In addition, system failure or performance issues could
increase our operating costs by limiting our ability to review and dispute
invoicing and provisioning data provided by our service providers. These are all
critical issues which may devastate our business and may cause you to lose your
investment.
   8
   RISKS
RELATED TO OUR INDUSTRY.
  12. OUR RIGHTS TO THE USE OF
TELECOMMUNICATIONS FACILITIES AND TELECOMMUNICATIONS BANDWIDTH THAT MAKE UP OUR
NETWORK MAY BE AFFECTED BY THE FINANCIAL HEALTH OF THE TELECOMMUNICATIONS
FACILITY AND BANDWIDTH PROVIDERS WHICH COULD RESTRICT OUR ACCESS TO ESSENTIAL
SERVICES AND COULD REDUCE OUR REVENUE OR INCREASE OUR OPERATING COSTS WHICH MAY
CAUSE US TO GO OUT OF BUSINESS AND YOU MAY LOSE YOUR
INVESTMENT.
  The
majority of our planned network will be held by us through short-term and
long-term service agreements and/or irrevocable right of use agreements with
various unrelated third-party providers who provide us with access to internet
and telecommunications facilities and bandwidth owned by them. If one of these
providers has a bankruptcy or financial collapse, we could lose our access to
telecommunication services from the provider, which in turn could impact the
integrity of our network resulting in a loss of revenues or leading to an
increase in operating costs. Should this occur, we may be unable to continue our
business, and you could lose your investment.
  13. THE OPERATION, ADMINISTRATION,
MAINTENANCE AND SUPPORT OF OUR SYSTEMS ARE SUBJECT TO RISKS THAT COULD LEAD TO
INTERRUPTIONS IN OUR SERVICES AND THE FAILURE OF OUR SYSTEMS TO OPERATE AS
INTENDED, WHICH COULD RESULT IN LESS REVENUE AND/OR HIGHER OPERATING COSTS WE
MAY CAUSE US TO LOSE CUSTOMERS.
  Our
system is and will be subject to the risks inherent in large-scale, complex
telecommunications systems. The operation, administration, maintenance and
repair of our systems will require the coordination and integration of
sophisticated and highly specialized software technologies and equipment located
throughout the world. Our system may not continue to function as expected in a
cost-effective manner. The failure of the hardware or software to function as
required could render our Company unable to perform at design specifications.
Failures in our system could result in reduced revenue and/or increased
operating costs and loss of customers. If our costs exceed our revenues, we may
be unable to continue our operations, and you may lose your
investment.
  14.
THE PRICES FOR TELECOMMUNICATIONS SERVICES HAVE BEEN DECREASING, AND WE EXPECT
THAT SUCH DECREASES WILL CONTINUE OVER TIME, THUS REDUCING OUR ANTICIPATED
REVENUES AND ANY MARGIN OF PROFIT WE MAY REALIZE. WITHOUT SUFFICIENT REVENUES TO
COVER OUR EXPENSES AND GENERATE A PROFIT, WE WILL GO OUT OF BUSINESS AND YOU MAY
LOSE YOUR INVESTMENT.
  We expect
price decreases in our industry to continue as demand increases for transmission
capacity on existing and new networks. If the prices for our services decrease
for whatever reason and we are unable to increase volumes through additional
services or otherwise, it would reduce revenues and lower our operating results.
If we do not generate sales sufficient to cover our expenses and generate a
profit, you may lose your investment.
  15. CHANGES IN REGULATORY
ENVIRONMENTS MAY REQUIRE US TO OBTAIN AND MAINTAIN A NUMBER OF GOVERNMENTAL
LICENSES AND PERMITS, WHICH COULD BE AN EXPENSIVE AND TIME-CONSUMING PROCESS,
AND THERE IS NO ASSURANCE WE WILL BE ABLE TO OBTAIN OR MAINTAIN THE LICENSES OR
PERMITS, THUS WE MAY BE FORCED TO GO OUT OF BUSINESS AND CAUSE YOU TO LOSE YOUR
INVESTMENT.
  Our
business is subject, to privacy laws and regulations enacted in the United
States and other jurisdictions around the world that govern the collection and
use of personal data of our customers and our ability to contact our customers
and prospective customers, including through telephone or facsimile. We are
subject to U.S. federal privacy regulation, including the federal Telemarketing
Sales Rule with its “do not call” and “do not fax” provisions, and state privacy
regulations. Many states have laws and regulations regarding telemarketing laws,
telephone solicitation laws, including “do not call” and “do not fax”
regulations. Additionally, changing regulatory environments may require us to
obtain and maintain a number of governmental licenses and permits in the future.
If we fail to comply with those regulatory requirements or fail to obtain and
maintain those licenses and permits, we may not be able to conduct our business.
Moreover, those regulatory requirements could change in a manner that
significantly increases our costs and reduces our operating results. If we do
not generate sales sufficient to cover our expenses and generate a profit, you
may lose your investment.
  16. ATTEMPTS TO LIMIT THE BASIC
COMPETITIVE FRAMEWORK OF THE TELECOM ACT COULD INTERFERE WITH THE SUCCESSFUL
IMPLEMENTATION OF OUR BUSINESS PLAN, WHICH COULD INCREASE OUR OPERATING COSTS
AND/OR REDUCE OUR REVENUES.
  Successful
implementation of our business plan is predicated on the assumption that the
basic framework for competition in the local exchanges services market
established by the Telecom Act will remain in place. We expect that there will
be attempts to modify, limit or eliminate this basic framework through a
combination of federal legislation, new rulemaking proceedings by the FCC and
challenges to existing and proposed regulations by the Regional Bell operating
companies ("RBOCs"). If those provisions of the Telecom Act are changed, those
changes could significantly increase our operating costs and/or reduce our
revenue. If we do not generate sales sufficient to cover our expenses and
generate a profit, you may lose your investment.
  17. POTENTIAL REGULATION OF INTERNET
SERVICE PROVIDERS COULD SUBJECT US TO UNFORSEEN RESTRICTIONS ON OUR PROJECTED
USE OF THE NETWORK WHICH COULD INCREASE OUR OPERATING COSTS.
  The FCC
has to date treated Internet service providers as enhanced service providers.
Enhanced service providers are currently exempt from federal and state
regulations governing common carriers, including the obligation to pay access
charges and contribute to the universal service funds. The FCC is currently
examining the status of Internet service providers and the services they
provide. If the FCC were to determine those Internet service providers, or the
services they provide, are subject to FCC regulation, including the payment of
access charges and contribution to the universal service funds, it could affect
VGTel because those additional charges could be passed to us and could
significantly increase our operating costs. If we do not generate sales
sufficient to cover our expenses and generate a profit, you may lose your
investment.
  18. UNAUTHORIZED DISCLOSURE OF
SENSITIVE OR CONFIDENTIAL CLIENT AND CUSTOMER DATA, WHETHER THROUGH BREACH OF
OUR COMPUTER SYSTEMS OR OTHERWISE, COULD EXPOSE US TO PROTRACTED AND COSTLY
LITIGATION AND CAUSE US TO LOSE CLIENTS WHICH MAY RESULT IN OUR GOING OUT OF
BUSINESS AND FOR YOU TO LOSE YOUR INVESTMENT.
  We may be
required to collect and store sensitive data in connection with our services,
including names, addresses, social security numbers, credit card account
numbers, checking and savings account numbers and payment history records, such
as account closures and returned checks. If any person, including any of our
employees, penetrates our network security or otherwise misappropriates
sensitive data, we could be subject to liability for breaching contractual
confidentiality provisions and/or privacy laws. Penetration of the network
security of our data centers could have a negative impact on our reputation and
could lead our present and potential clients to choose other service providers,
which would devastate our business, and may result in the loss of your
investment.
  19. OUR POTENTIAL CLIENTS MAY ADOPT
TECHNOLOGIES THAT DECREASE THE DEMAND FOR OUR SERVICES, WHICH COULD REDUCE OUR
REVENUES AND CAUSE US TO GO OUT OF BUSINESS AND FOR YOU TO LOSE YOUR
INVESTMENT.
  We plan
to target clients with a need for our services and we will depend on their
continued need of our services. However, over time, clients may adopt new
technologies that decrease the need for live customer interactions, such as
interactive voice response, web-based self-help and other technologies used to
automate interactions with customers. The adoption of such technologies could
reduce the demand for our services, pressure our pricing, cause a reduction in
any revenues we are generating at the time, and harm our business. Should that
occur, it may devastate our business, and cause you to lose your
investment.
  20.
SYSTEM FAILURES COULD PREVENT ACCESS TO OUR WEBSITE AND PREVENT OUR CLIENTS FROM
USING OUR SYSTEM THEREBY REDUCING OUR REVENUES. IF WE DO NOT GENERATE SUFFICIENT
REVENUES TO COVER OUR EXPENSES AND GENERATE A PROFIT, WE MAY GO OUT OF BUSINESS
AND YOU MAY LOSE YOUR INVESTMENT.
  Since the
success of our business will depend upon our use of the internet for VOIP
services, any network interruptions, difficulty or inability to access our
website, or other problems with our website, would result in declining revenue
and loss of potential customers. We anticipate that our systems and operations
will be vulnerable to damage or interruption from a number of sources, including
fire, flood, power loss, telecommunications failure, physical and electronic
break-ins, earthquakes and other similar events. We believe our servers will
also be vulnerable to computer viruses, physical or electronic break-ins and
similar disruptions. Any substantial disruption of this sort could completely
impair our ability to generate revenue through our website. We do not currently
have a formal disaster recovery plan in effect and do not have business
interruption insurance to compensate us for losses that could occur.
Consequently, these risks if realized will cause us to go out of business, and
you may lose your entire investment.
   9
  21. OUR OPERATING RESULTS COULD BE
IMPAIRED IF WE BECOME SUBJECT TO BURDENSOME REGULATIONS, LEGAL UNCERTAINTIES,
AND/OR FEES CONCERNING OPERATION OF OUR WEBSITE WHICH MAY INCREASE OUR EXPENSES
AND CAUSE US TO GO OUT OF BUSINESS.
  Since
1998, the system for the internet has been run by a US (non governmental
organization) known as ICANN - the Internet Corporation for Assigned Names and
Numbers. It is an independent body, but is under contract to the US Department
of Commerce. Other countries have become increasingly uncomfortable with the
arrangement, countries including China and Iran wanted so-called “internet
governance” transferred to an international body linked to the UN while the EU
wanted some kind of intergovernmental “cooperative body”. An agreement was
reached November 2005 wherein the US will keep its oversight of the technology
that underpins the internet. But a new international “internet governance forum”
will be set up to discuss issues of concern. Although currently this new forum
is not envisioned to have any decision-making powers,” there is no assurance
that this forum and the international community will not at some point impose
burdensome regulations or fees to companies conducting commerce over the
internet. Should that occur, it would adversely affect our business and may
impede our ability to implement our platform and to facilitate transactions over
the internet. Consequently, it could result in our business failing, and you
losing your entire investment.
  22. WE ARE SUBJECT TO THE POLITICAL,
AND MILITARY CONDITIONS OF EACH COUNTRY IN WHICH WE PLAN TO SELL OUR SERVICES.
POLITICAL UNREST COULD INTERRUPT OUR BUSINESS WHICH COULD CAUSE US TO LOSE
REVENUES WHICH MAY LEAD TO OUR GOING OUT OF BUSINESS.
  We plan
to expand our business globally in various parts of the world. Our only client
currently is located in the state of Israel which has recently been engaged in a
war and is still facing uncertainty. During this brief, war no business was
transacted. Furthermore, we plan to expand our operations globally to other
countries which may face political unrest or other local challenges. If that
occurs our business may be halted and we may go out of business.
  RISKS
RELATED TO OUR COMMON STOCK:
  23.
SALES OF A SUBSTANTIAL NUMBER OF SHARES OF OUR COMMON STOCK INTO THE PUBLIC
MARKET BY THE SELLING STOCKHOLDERS MAY RESULT IN SIGNIFICANT DOWNWARD PRESSURE
ON THE PRICE OF OUR COMMON STOCK AND COULD AFFECT THE ABILITY OF OUR
STOCKHOLDERS TO REALIZE THE CURRENT TRADING PRICE OF OUR COMMON STOCK WHICH MAY
CAUSE YOU TO LOSE SOME OR ALL OF YOUR INVESTMENT
  Sales of
a substantial number of shares of our common stock in the public market could
cause a reduction in the market price of our common stock. We had 4,800,000
shares of common stock issued and outstanding as of the date of this prospectus.
When this registration statement is declared effective, the Selling Stockholders
will be able to resell up to 800,000 shares of our Common Stock and if each
shareholder exercises his Warrants we will
be required to issue an additional 3,200,000 shares of Common Stock which the
Selling Warrant Holders will be able to resell in the market. As a result, a
substantial number of our shares of Common Stock may be issued and may be
available for immediate resale, which could have an adverse effect on the price
of our Common Stock. As a result of any such decreases in price of our Common
Stock, purchasers who acquire shares from the Selling Stockholders may lose some
or all of their investment. Any
significant downward pressure on the price of our Common Stock as the Selling
Shareholders sell their shares of our Common Stock could encourage short sales
by the Selling Shareholders or others. Any such short sales could place further
downward pressure on the price of our Common Stock. In
addition, as of the date of this prospectus there are 4,000,000 outstanding
shares of our Common Stock that are restricted securities as that term is
defined in Rule 144 under the Securities Act of 1933, as amended (the
"Securities Act"). Although the Securities Act and Rule 144 place certain
prohibitions on the sale of restricted securities, restricted securities may be
sold into the public market under certain conditions. The sale of these shares
may further depress the price of our shares.
  24. IF A MARKET FOR THE COMPANY'S
COMMON STOCK DOES NOT DEVELOP INVESTORS MAY BE UNABLE TO SELL THEIR SHARES AND
YOU MAY LOSE YOUR INVESTMENT.
  There is
currently no market for the Company's Common Stock and there may never be a
public market. If no market ever develops for the Company's shares, it will be
difficult for new investors to sell their shares. In addition, there may be no
share volume to allow new investors to sell their shares at any market price.
Without a public market or a public market that does not allow new investors to
realize their investment or to sell their shares, new investors should consider
whether or not they wish to invest in shares which they may not be able sell in
a public market.
  25. IF THE COMPANY FAILS TO ATTRACT
OR MAINTAIN THE SERVICES OF A MARKET MAKER IT WILL LIMIT THE LIQUIDITY OF THE
SHARES PURCHASED BY NEW INVESTORS AND YOU MAY BE UNABLE TO SELL YOUR SHARES AND
THEREFORE YOU MAY LOSE YOUR INVESTMENT.
  If the
Company is unable to secure and maintain at least one National Association of
Securities Dealers, Inc. member broker/dealer as market maker, the liquidity of
the Common Stock could be impaired, not only in the number of shares of Common
Stock which could be bought and sold, but also through possible delays in the
timing of transactions, and lower prices for the common stock than might
otherwise prevail. Furthermore, the lack of market makers could result in
persons being unable to buy or sell shares of the Company's Common Stock on any
secondary market. A new investor should consider whether or not he or she wishes
to invest in a company which may never have a proven track record in the public
market and may not have the services of any market maker causing the shares to
be illiquid.
  26.
AS A NEWLY REPORTING COMPANY UNDER THE EXCHANGE ACT, WE WILL BE SUBJECT TO
CERTAIN PROVISIONS OF THE SARBANES-OXLEY ACT OF 2002 AFFECTING CORPORATE
GOVERNANCE, SECURITIES DISCLOSURE, COMPLIANCE PRACTICES, INTERNAL AUDITS,
DISCLOSURE CONTROLS AND PROCEDURES AND FINANCIAL REPORTING AND ACCOUNTING
SYSTEMS. NONE OF OUR OFFICERS AND DIRECTORS HAVE BEEN ASSOCIATED WITH A PUBLIC
COMPANY PREVIOUSLY, OR HAVE EXPERIENCE OVERSEEING COMPLIANCE WITH THE SARBANES-
OXLEY ACT. FAILURE TO COMPLY WITH THE ACT MAY RESULT IN INVESTORS LOSING
CONFIDENCE IN THE RELIABILITY OF OUR FINANCIAL DISCLOSURE DOCUMENTS AND MAY ALSO
RESULT IN OUR STOCK BEING DELISTED FROM THE OTC BULLETIN BOARD. SHOULD THAT
OCCUR IT WOULD LIKELY RESULT IN A SUBSTANTIAL DECLINE IN THE PRICE OF OUR
STOCK.
  As a
reporting company under the Exchange Act, we will be subject to certain
provisions of the Sarbanes-Oxley Act of 2002 . The Sarbanes-Oxley Act affects
corporate governance, securities disclosure, compliance practices, internal
audits, disclosure controls and procedures and financial reporting and
accounting systems. Section 404 of the Sarbanes-Oxley Act, for example, requires
companies subject to the reporting requirements of the U.S. securities laws to
do a comprehensive evaluation of its and its consolidated subsidiaries’ internal
control over financial reporting. The failure to comply with Section 404, when
we are required to comply, may result in investors’ losing confidence in the
reliability of our financial statements, which may result in a decrease in the
market value of our common stock, prevent us from providing the required
financial information in a timely manner, which could materially and adversely
impact our business, our financial condition and the market value of our common
stock, prevent us from otherwise complying with the standards applicable to us
as a public company and subject us to adverse regulatory
consequences.
  27. PENNY STOCK RULES MAY MAKE BUYING
OR SELLING OF THE COMPANY'S SHARES DIFFICULT WHICH MAY CAUSE YOU TO LOSE PART OR
ALL OF YOUR INVESTMENT
  Broker-dealer
practices in connection with transactions in penny stock are regulated by
certain penny stock rules adopted by the Securities and Exchange Commission (the
"SEC"). Penny stocks generally are equity securities with a price of less than
$5.00 (other than securities registered on certain national securities exchanges
and quoted on the NASDAQ system). The penny stock rules require a broker-dealer,
prior to a transaction in a penny stock not otherwise exempt from the rules, to
deliver a standardized risk disclosure document that provides information about
the penny stocks and the nature and level of risks in the penny stock market.
The broker-dealer also must provide the customer with current bid and offer
quotations for the penny stock, the compensation of the broker-dealer and its
salesperson in the transaction, and monthly account statements showing the
market value of each penny stock held in the customer's account. In addition,
the broker-dealer must 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. These requirements may have the effect of reducing
the level of trading activity, if any, in the secondary market for a security
that becomes subject to the penny stock rules. Since the common shares will be
subject to the penny stock rules, and investors may find it more difficult to
sell their shares.
  28. THE LIMITED MARKET FOR OUR SHARES
WILL MAKE OUR PRICE MORE VOLATILE. AS WELL, OUR STOCK IS HELD BY A SMALL NUMBER
OF INVESTORS THUS REDUCING THE LIQUIDITY OF OUR STOCK AND THE LIKELIHOOD THAT
ANY ACTIVE TRADING MARKET WILL DEVELOP. AS A RESULT YOU MAY LOSE PART OR ALL OF
YOUR INVESTMENT.
  There is
currently no market for our Common Stock. Even if we are successful in our stock
trading on the OTC Bulletin Board, the market for our common stock is likely to
be very limited and we cannot assure you that a larger market will ever be
developed or maintained.
  Currently,
our Common Stock is not listed on any established trading system. The fact that
most of our Common Stock is held by a small number of investors further reduces
the liquidity of our Common Stock and the likelihood that any active trading
market will develop. The market for our Common Stock is likely to be volatile
and many factors may affect the market. These include, for example: Our success,
or lack of success, in marketing our services and developing our customer base;
Competition; and our ability to raise sufficient capital for business
expansion.
  Additionally
the stock markets generally have experienced, and will likely continue to
experience, extreme price and volume fluctuations which have affected the market
price of the shares of many small capital companies. These fluctuations have
often been unrelated to the operating results of such companies. Such broad
market fluctuations, as well as general economic and political conditions, may
decrease the market price of our Common Stock in any market that
develops.
  10
   Item
2:  Description of Properties:
  As of
June 25, 2008   our administrative office is located at:
 2 Ingrid
Road
 Setauket,
NY 11733-2218
 Tel: 
631-458-1120
  Our CEO
has agreed to provide his home office for administrative use by the Company free
of charge. The office is equipped with standard office equipment including
computers, scanners, copiers, and fax machine and office space.
  Item
3:  Legal Proceedings
  Neither
us, nor any of our officers or directors is a part’ to any material legal
proceeding or litigation and such persons know of no material legal proceeding
or contemplated or threatened litigation. There are no judgments against us or
our officers or directors. None of our officers or directors has been convicted
of a felony or misdemeanor relating to securities or performance in corporate
office.
  Item
4:  Submission of Matters to a Vote of Security
Holders:
  
 Item 5:Market for Common Equity and Related
Stockholder Matters
  There is
no public trading market for the securities of the Company. The Company is
neither a reporting issuer in the United States nor a publicly traded company on
any stock exchange. Therefore, there is no trading range in the Company's
shares. Subsequent to the effective date of the Company's Registration
Statement, the Company will seek to have one or more broker dealers make a
market in its securities over-the-counter, with quotations carried on the
National Association of Securities Dealers, Inc.'s "OTC Bulletin Board".
However, there is no assurance the Company will ever be quoted on the OTC
Bulletin Board or any other exchange. Furthermore, even if a trading market
develops, there is no assurance that it will be sustained. Consequently, a
purchaser of shares may be unable to resell the securities offered herein should
the purchaser desire to do so when eligible for public re-sales. Furthermore,
the shares are not marginable and it is not likely that a lending institution
would accept our common stock as collateral for a loan.
  This
prospectus relates to the sale by Selling Shareholders of up to 4,000,000 shares
of Common Stock which includes 800,000 shares of Common Stock and 3,200,000
shares of Common Stock issuable upon exercise of certain stock purchase
Warrants.
  The
Selling Shareholders will determine when they will sell their shares of Common
Stock and when and if they will exercise their Warrants.
  Item
6:  Management Discussion & Analysis
  Forward-Looking
Statements
   This
prospectus contains "forward-looking statements," about our financial condition,
results of operations and business. These statements include, among
others:
  ·
                    Statements
      concerning the benefits that we expect will result from our business
      activities and certain transactions that we have completed, such as
      increased revenues, decreased expenses and avoided expenses and
      expenditures; and
  ·
                    Statements
      of our expectations, beliefs, future plans and strategies, anticipated
      developments and other matters that are not historical
    facts.
  These
statements may be made expressly in this document or with documents that we will
file with the SEC. You can find many of these statements by looking for words
such as "believes," "expects," "anticipates," "estimates" or similar expressions
used in this prospectus. These statements are only predictions and involve known
and unknown risks, uncertainties and other factors, including the risks in the
section entitled "Risk Factors" that may cause our or our industry's actual
results, levels of activity, performance or achievements to be materially
different from any future results, levels of activity, performance or
achievements expressed or implied by these forward-looking statements. We
caution you not to put undue reliance on these statements, which speak only as
of the date of this prospectus. Further, the information contained in this
prospectus is a statement of our present intention and is based on present facts
and assumptions, and may change at any time and without notice, based on changes
in such facts or assumptions.
  While
these forward-looking statements, and any assumptions upon which they are based,
are made in good faith and reflect our current judgment regarding the direction
of our business, actual results will almost always vary, sometimes materially,
from any estimates, predictions, projections, assumptions or other future
performance suggested herein. Except as required by applicable law, including
the securities laws of the United States, we do not intend to update any of the
forward-looking statements to conform these statements to actual results. The
safe harbor for forward-looking statements provided in the Private Securities
Litigation Reform Act of 1995 does not apply to the offering made in this
prospectus.
  We are a
development stage company currently testing a newly developed telemarketing
campaign product called Global Messaging Gateway (GMG). The GMG system is
designed to enable the User of the system to set up telemarketing campaigns to
distribute messages to bulk lists of recipients. Messages can be delivered in
the medium of text, voice, Fax or multimedia. Messages can be delivered from one
control center to thousands of clients anywhere in the world simultaneously. The
GMG System uses the internet instead of traditional telephone equipment. (See
"Description of Business".)
  The
Global Messaging Gateway (GMG) is currently the first and only product of the
Company. We currently have only one User that is using our system. For the
twelve months ending March 31, 2007, we generated $ 19,386 and during the
fiscal year ended March 31, 2008 we generated revenues of $15,840
from Platin.   Consequently, the aggregate revenues we generated
to date from our only customer, Platin Ltd. is $41,547. Platin
 pays a monthly fee for the lines and a per call fee for each successful
call placed.   Platin is a related party.    Platin Ltd., is
a related party.  Israel Hason is the Chief Marketing Officer of our
Company and a Director. Mr. Hason is also the managing partner and principal
shareholder of Platin Ltd. Israel.   Mr. Hason has agreed to
recuse himself from any corporate decision relating to Platin Ltd business
relationship with VGTel, Inc.
  During
the next 12 months, we plan to focus on three applications of the GMG
system:
 
 (1)
                  GMG
      Commercial Telemarketing Services,
 
 (2)
                  GMG
      Alert Notification System
 
 (3)
                  GMG
      Global Franchise Partners
    11
   Contracts
& Agreements & Relationships:
 
 On July
14, 2005 the Company entered into a software development agreement with Kanaga
Network Solution to develop the software that will enable our GMG system to
provide the capabilities for a User of our system to send promotional messages
(Text and Voice) to a set of subscribers, with the following
functionalities.
  •
                  Schedule,
      execute and management of promotional campaigns.•
                  Web-based
      user interface
 
 •
                  Create,
      manage and import recipients’ telephone numbers,•
                  Create
      and manage recipients groups.
 
 •
                  Capabilities
      to create new text and voice messages for campaigns.•
                  History
      and reports related to past campaigns
  performance.
 
 •
                  Existing
      Database Integration.•
                  Message,
      Recipient and Campaign Search Capabilities
  Server)
 
  According
to the Agreement, Kanaga will develop the system for a fixed price, and will
provide annual maintenance and support for 10% of the development price.
Additional assignments will be priced on a per item basis.  From the
inception of the GMG System, Kanaga provided software development services for
an aggregate of $25,750 for the years ended March 31, 2006 and March 31,
2007.  During the six month period ending September 30, 2007  Kanaga
provided software development services for an
additional $10,500.  Consequently , Kanaga provided an aggregate
of $36,250 from inception to  March 31, 2008.  During the next 12
months we anticipate our further development costs will be $9,000. We believe we
will continue working with Kanaga during 2008 and 2009 to support our planned
pipeline of products and services.
 The
Agreements further specifies that all the rights and ownership of the developed
GMG Products, along with the associated documents will solely belong to the
Company. Any use of the GMG products, or one of its elements by Kanaga will
require a prior written consent of the Company.    Exhibit 10.2
which is incorporated by reference contains the  complete text of the
Agreement
  Internet
Gold:   (Smile
Communications):
 
 On Nov. 1
2006 the Company entered into a contract with Internet Gold  (on Jan
01.2008 the company changed its name to Smile Communications)to provide
us with required connection to the global VOIP network via their advanced
services capabilities. The Contract has a one year term but may be terminated by
either party for cause or convenience upon thirty days written notice. The
Agreement is a reciprocal agreement between the parties allowing each party to
send traffic to the counter party. In the future, when the company will have
similar agreements with other VOIP carriers, this option for traffic exchange
may be developed into an additional revenue stream.
 
 The
contract provides that Internet-Gold may, at its sole discretion and at any
time, change the applicable rates due to it, and/or the destinations to which it
offers the Service, upon 7 (seven) days prior written notice to the Company. We
are being billed in 1 (one) second increments as of the 1st second, unless
stated otherwise. The Agreement does not provide volume discounts, or minimum
message requirements. We are billed only for the per call use. However, we
believe that if the volume of messages increased ten times the current volume,
we would be in a stronger position to negotiate a more favorable rate with
either Internet Gold, or alternate provider for this service. We believe that if
Internet Gold were to increase the rate or terminate the service, we would
easily be able to find an alternate source to provide this service, as the VOIP
carrier business is highly competitive.
 
 Platin
Ltd:
  Platin
Ltd. is a telemarketing company that is our only customer to date. In January
2006 Platin Ltd. placed an order for our telemarketing services for the upcoming
election in Israel which was scheduled for March 28, 2006. Platin has been using
our System ever since for both political campaigns and for commercial
telemarketing services which they provide to a variety of their clients. We
charge Platin a monthly per line cost of $3.0 plus a usage fee of $0.015
per min. while the GMG system is in the testing phase. For the twelve months
ending March 31, 2007, we generated $ 19,386 and during the fiscal year
ended March 31, 2008 we generated revenues of  $15,840
from Platin.   Consequently, the aggregate revenues we generated
to date from our only customer, Platin Ltd. is $41,547.
  Platin
 pays a monthly fee for the lines and a per call fee for each successful
call placed.    Platin does not pay for development costs
resulting from upgrades to features and functions.  See Platin Exhibit 10.3
for Telemarketing Order Framework dated January 15, 2006 and June 12,
2006.
  Platin
Ltd., is a related party.  Israel Hason is the Chief Marketing Officer of
our Company and a Director. Mr. Hason is also the managing partner and principal
shareholder of Platin Ltd. Israel.   Mr. Hason has agreed to
recuse himself from any corporate decision relating to Platin Ltd business
relationship with VGTel, Inc.
  Ongoing
Development of our GMG Systems.
  From the
inception of the GMG System, Kanaga provided software development services for
an aggregate of $25,750 for the years ended March 31, 2006 and March 31,
2007.  During the six month period ending September 30, 2007  Kanaga
provided software development services for an additional
$10,500.  Consequently , Kanaga provided an aggregate of $36,250 from
inception to  March 31, 2008
  During
the next 12 months we anticipate our further development costs will be $9,000.
We believe we will continue working with Kanaga during 2008 and 2009 to support
our planned pipeline of products and services.
 
 During
the next twelve months, our development activities with Kanaga include adding
features, fixing problems and integrating new customer driven ideas. Each new
feature is being integrated into the commercial operating environment and gets
tested immediately under real commercial conditions. Additionally, during this
period Kanaga will continue the ongoing development of the GMG Alert System and
the GMG Notification application for K-12 Educational Sector.
    12
  Plan of Operations for the
Next 12 Months Period.
  During
the next twelve months, we expect to take the following steps in connection with
the development of our business and the implementation of our plan of
operations:
 
 ·
                  Continue
      testing our system with Platin Ltd. our only client to date. During this
      testing phase, our development activities are continuing to add features,
      fix problems and integrate new customer driven
  ideas.
 
 ·
                  During
      the next three months our goal is to limit our commercial
      clientele to only three customers, allowing us to quickly respond and fix
      any operational problem discovered by the customers. In addition, every
      new feature will be integrated into the commercial operating environment
      and tested immediately under real commercial condition.   We
      currently are negotiating agreements or understandings
      with additional entities to become our
  client.
 
 ·
                  Beginning 
      September  2008, we will be technically able to slowly add a few
      customers while we continue adding features and fixing operational
      problems, and by December  2008 we believe we will
      be technically in  a position to serve unlimited number of
      customers. We currently have no agreement or understanding with any entity
      to become our client.
  ·
                  During
      the next six months we plan to continue developing the GMG Alert System
      which we anticipate will be ready for testing by  February
       2009. We anticipate that by May  2009  the
      Alert system will be well enough refined to allow us to accept a limited
      number of clients for this system.
 
  
 ·
                  Beginning
      in December 2008, we plan to prepare and execute a marketing plan to
      increase the number of Users to our system. (See Marketing Plan in the
      section Business under the sub heading Distribution of Products &
      Services. :)
   ·
                  Beginning
      in December  2008, we plan to announce our services using our
      GMG system to the aforementioned targets in the US and Israel. We plan to
      target companies that will use our system for their established clients
      which will provide us with a quicker market penetration since we
      anticipate that each client that we contract with, will be using our GMG
      system for many of their clients which will result in many clients using
      our system. Additionally we plan to target direct users of our system who
      will use the system for their own purposes. Beginning in January
       2009, we believe we will be in a position to add unlimited clients
      for our GMG telemarketing product.
 
  
 ·
                  Beginning
      in May  2009, we plan to begin marketing our Notification System to a
      list of schools in Texas and thereafter on a national
    level.
 
 We
      have started looking for and negotiating contracts with principals of four
      potential entities which represent different market opportunities,
      providing the best learning ground for future expansion of our
      business.·
                  Our
      registration statement was  rendered effective by the Securities
      & Exchange Commission, and we are currently seeking private
       placement investors to invest in our securities. Additional
      financing may not be available on acceptable terms, or at all. If adequate
      funds are not available or are not available on acceptable terms, we may
      not be able to fully execute our Plan of Operations, which could
      significantly and materially restrict our business operations. If
      additional capital is raised through the sale of additional equity or
      convertible securities, substantial dilution to our stockholders is likely
      to occur.
 
 ·
                  We
      plan to initiate phase two of our operations, as soon as we raise
      additional capital sufficient to support the costs of executing the second
      phase of our operations.
 
 PHASE
II
  Expansion
Plan:
  PHASE
II
  Expansion
Plan:
  We plan
to initiate Phase II after we complete the activities outlined above for the
next twelve months. Executing Phase II is entirely dependent on our ability to
raise additional funds.
  ·
                  To
      obtain additional equity financing through Private Placement investments
      after the Company's registration statement is rendered effective. Raising
      additional capital is essential to finance the company's expansion of
      services and territories as described in the Expansion Plan.·
                  To
      continue to develop the multi server capability, in order to increase the
      capacity of our GMG System to satisfy any required load by the
      users.
 
 ·
                  To
      increase the number of content-based products which are being offered
      through the VGTel website. (See Phase II Products & Services described
      in the Business section under "Products &
  Services")
  ·
                  .To
      increase the number of franchises by direct marketing of franchises and
      recruiting area developers
  The
Company plans to raise additional funds in order to expand its business and
fully execute its Plan of Operations including the Expansion Plan. There is no
assurance  that the Company will be successful in raising sufficient funds
to execute its expansion agenda.   If additional capital is raised
through the sale of additional equity or convertible securities, substantial
dilution to our stockholders is likely to occur which may result in a partial or
substantial loss to your investment in our common stock.
  If we are
successful in raising additional funds, we plan to hire and train key
individuals for positions which include global management, marketing, and
administrative. The number of employees hired will be dependent upon a variety
of factors including our progress in implementing our business plan and
available capital. By the fourth  quarter of 2008, we expect to
require approximately 5 employees and anticipate incurring $30,000 per month for
payroll. The hiring of employees will be an ongoing process during the company’s
existence. Additionally, the Company plans to utilize outside marketing and
public relations firms to facilitate strategic alliances with potential
franchisers and telemarketers. Depending on the availability of funds, the
Company plans to spend $50,000 in advertising and marketing of its products and
services during the second Phase of our operations.
    13
   Results
of Operations:
 
 Fiscal
Year  Ended  March 30, 2008 and March 30, 2007
  Revenues:
 
 Revenues
for the fiscal year ending March 31, 2008  was $15,840 compared to $19,386
for the fiscal year ended March 31, 2007. The decrease  in 
revenues in the period ending March 31, 2008 was a result of the fact that the GMG
system had more bugs than anticipated requiring additional support effort to fix
them and convincing our customer to use te system inspite of the operational
problems.
  We
continued to provide the services to Platin Ltd. during the twelve month period
ended March 31, 2008.
  Platin,
our only client to date is currently testing our system and providing
feedback to improve our product.  Platin Ltd. is a related party. 
Israel Hason is the Chief Marketing Officer of our Company and a Director. 
Mr. Hason is also the managing partner and principal shareholder of Platin Ltd.
Israel.
  Expenses:
  Total
operating expenses for the fiscal year ended March 31, 2008  was $101,361
as compared to $118,981 for the fiscal year ended March 31, 2007,
a  decrease of 17%.     Expenses included
General and Administrative expense of $39,561 as compared to $57,181for fiscal
year ending March 31, 2007.  Officers Compensation & Rent amounted to
$56,000 during the fiscal year ended March 31, 2008 as compared to from $56,000
during the fiscal year ended March 31, 2007.  Additional Paid in
Capital has been credited for these amounts.  Depreciation &
Amortization was $5,800 for the fiscal year ended March 31, 2008 compared
to $5,800 for the period ending March 31, 2007.  The decrease  in
administrative expenses and other expenses in the fiscal year ended March 31,
2008  resulted from  the
decrease in generated traffic, and the associated operational
costs.
  Research
and development expenses for the fiscal year ended December 31, 2007
decreased  to $10,500 as compared to $23,500  for the fiscal year
ended March 31, 2007. The decrease in research and development cost
was attributable the fact that  Kanaga
was busy fixing bugs and maintaining the system having less time to continue
developing more features and new applications. The
Company developed the intellectual properties known as Group Messaging Gateway.
As of March 31, 2008 the Company and its shareholders have expended
$100,500  in the development of this program as compared to $99,000 for the
fiscal year ended March 31, 2007.    It has been determined that
of this amount, the sum of  $29,000 had been incurred after technological
feasibility has been reached.  The asset valued at $29,000 is being
amortized over a sixty-month period.
 
 All costs
incurred during the pre-feasibility phase were expensed. All costs incurred in
the actual development after the product has been determined to be
technologically feasible, were capitalized. All post operational development
costs were expensed.
 
 Development
costs since inception to the period from  March 31, 2006 to March 31,
2008 is as follows:
 
 Pre-Technological
                    Feasibility
                  Twelve
      Month
                    Period
                    Ending
                    3-31-2006
                  Expensed
                  $37,500Development
      of
                    Product
                  Twelve
      Month
                    Period
                    Ending
                    3-31-2006
                  Capitalized
                  $29,000Pre-Technological
      Feasability
                    (Brain
      & Power Ltd.) $10,000
                    
                    Post
      Operational
                    Development 
      (Kanaga) $13,500
                  Twelve
      Month
                    Period
                    Ending
                    3-31-07
                  Expensed
                  $23,500Post Operational Development (Kanaga)
                  For
      the 12 Month
                    Period
                    Ending
                    3-31-08
                  Expensed
                  $10,500
 
 
 Net
loss
 
 The
Company reported a net loss for the twelve month period ending March 31, 2008 of
$85,521 or ($0.02) per share as compared to  $99,595 or ($0.02) per
share,  for the fiscal year period ending March 31,
2007.
  The
Company's  cumulative net losses since its inception of  of
$241,542 for the period ending March 31, 2008 as compared to $155,342 for the
fiscal year ended March 31, 2007.  The decrease in net loss  is
 attributable to the fact that the
company had lower operational  and
R&D expenses.
  Liquidity
and Capital Resources:
 
 For
the Fiscal Year  Ended March 31, 2008 and March 31,
2007.
  As
of  March 31, 2008  the Company had  $5,126 as
compared to $  7,179 in cash,  as at March 31, 2007.
  Net cash
used by operating activities for the fiscal year period ended March 31,
2008  was  ($2,054) as compared to ($9,747)  for the fiscal
year  ended March 31, 2007.
  Net cash
provided by investing activities during the fiscal year ending March 31,
2009   was  $0 compared to $0 net cash provided by investing
activities for the previous twelve months period ended March 31,
2007.
  Net cash
provided by financing activities for the fiscal year ended March 31, 2008 was 0
as compared to $10,000  for corresponding period ending March 31,
2007.
  Ron
Kallus, the Company Chief Executive Officer and Principal shareholder provided a
credit facility to the Company up to a maximum of $20,000 which may be drawn
down anytime from March 1, 2006 until May 18, 2007. This unsecured facility is
payable May 18, 2007 and bears an interest rate of prime plus one (1) calculated
on an annual basis payable annually in arrears with first payment due March 1,
2007 and second payment due May 18, 2007, unless extended by mutual consent of
the parties.  On July 18, 2006, Mr. Kallus executed an amendment to the
March 1, 2006 credit facility increasing the total amount of the credit facility
from $20,000 to $50,000 and extending payable date from May 18, 2007 to December
31, 2007 with the first interest payment due July 1, 2007 and second payment due
December 31, 2007,  During the period ending March 31, 2007,  Mr.
Kallus advanced $12,100 compared to $4,223 in the corresponding period ending
March 31, 2006 for an aggregate of $16,323 from
inception.   No funds were advanced by Mr. Kallus during the
period ending March 31, 2008.
  Item 7:  Financial
Statements:  (See F-1 - F-6)
  Item 8: Changes In and Disagreements with
Accountants on Accounting and Financial Disclosure:
  The
principal accountant's report of N. Blumenfrucht, CPA PC on the financial
statements did not contain adverse opinion or disclaimer of opinion, or was
modified as to uncertainty, audit scope, or accounting principles. There has
been no disagreement with the auditors on any matter of accounting principles or
practices, financial statement disclosure, or auditing scope or
procedures.
  ITEM 8A.  CONTROLS AND
PROCEDURES:
  (a)  Evaluation
of Disclosure Controls and Procedures.
  Our Chief
Executive Officer and Chief Financial Officer (collectively the “Certifying
Officers”) maintain a system of disclosure controls and procedures that is
designed to provide reasonable assurance that information, which is required to
be disclosed, is accumulated and communicated to management timely. Under the
supervision and with the participation of management, the Certifying Officers
evaluated the effectiveness of the design and operation of our disclosure
controls and procedures (as defined in Rule [13a-14(c)/15d-14(c)]under the
Exchange Act) within 90 days prior to the filing date of this report. Based upon
that evaluation, the Certifying Officers concluded that our disclosure controls
and procedures are effective in timely alerting them to material information
relative to our company required to be disclosed in our periodic filings with
the SEC.
  (b)  Changes
in  internal Controls
  Our
Certifying Officer has indicated that there were no significant changes in our
internal controls or other factors that could significantly affect such controls
subsequent to the date of his evaluation, and there were no such control actions
with regard to significant deficiencies and material weaknesses.
  ITEM 8B.  OTHER INFORMATION:
 On May
28, 2008 the Registrant sold in a private placement transaction an aggregate
$24,000 of Series A Units of its securities, at a price of $.025 per unit. Each
Series A unit consists of One share of the Company's Common stock, One Series A
Warrant, One Series B Warrant, One Series C Warrant and One Series D Warrant.
Each of the four series of warrants entitles the holder to purchase one share of
the Company's Common Stock at an exercise price of $0.25 per Share. The Company
issued 960,000 Shares of Common Stock with warrants in lieu of cash. 
 The private placement was exempt from registration under Section 4(2) of
the Securities Act of 1933, as amended, and Rule 506 of Regulation D promulgated
thereunder, inasmuch as the securities were sold to accredited investors only.
The shares will bear a 144 Restrictive legend. The Company has not offered
Registration Rights to the subscriber.
   On May
28, 2008 the Registrant issued 674,000 shares for services rendered valued at
$16,850 in lieu of cash. The shares issued are restricted shares and are subject
to Rule 144.
   14
  Item 9:   Directors, Executive Officers, Promoters and Control
Persons   The
following sets forth our directors, executive officers, promoters and control
persons, their ages, and all offices and positions held. Directors are elected
for a period of two years and thereafter serve until their successor is duly
elected by the shareholders. Officers and other employees serve at the will of
the Board of Directors.
  
 
 Ron
      Kallus
                        2
      Ingrid Road
                        Setauket,
      NY 11733-2218
                        Tel:
      631-458-1120
                      Age-
      58
                      Chairman,
      CEO,
                        TreasurerIsrael
      Hason
                        40
      Serlin St.,
                        Holon
      58298, Israel
                      Age
      - 42
                      Chief
      Marketing Officer
                        DirectorNiva
      Kallus,
                        7
      Lafayett Ter.,
                        Chelmsford,
      MA 01824
                      Age
      - 23
                      Corporate
      Secretaries
                        Director.
  Officers
& Directors:
  Ron
Kallus, Age 58 Chairman, CEO, Treasurer
  Mr.
Kallus was appointed as Chairman, CEO and Treasurer on January 18, 2006. Mr.
Kallus is also president of NYN International LLC, since August 2004 and he is
Chief Operations Officer for Digital Power Technologies, Inc., a private R&D
company in Texas since July 2005. From  June 2003 until July 2004, he was
employed by NovoLink Communications, in Texas where he held the position of
VP-Business development. From August 2002 to May 2003 Mr. Kallus was a self
employed consultant in Berkeley CA. From January 2001 until July 2002 Mr. Kallus
was employed by IPI Ltd. in Haifa, Israel where he held the position of General
Manager In the prior period, Mr. Kallus worked at Intermetrics of Cambridge,
Massachusetts for 10 years, where he acted as the head scientist in the field of
industrial systems and was responsible for the development and sale of
computerized management systems (PMS). He later established Eurometrics, in
which he developed the first Personal Computer -based PMS system. Mr. Kallus
sold the company and established IPI, a technological consultation and Research
Company.
  Educational
Background:
  Israel
Institute of Technology, Haifa, Israel
 B.Sc.
Electrical Engineering, 1975
 Massachusetts
Institute of Technology, Cambridge, Mass., USA
 Graduate
work, Artificial Intelligence, 1977
 North
Eastern University, Boston, Mass., USA
 Graduate
work, Technical Management, 1981
  Israel
Hason Age 42 Chief Marketing Officer, Director
  On
January 18, 2006, Israel Hason was appointed Chief Marketing officer and
Director. Mr. Hason has been General Manager and principal shareholder of Platin
Ltd Israel since 1989 where he is responsible for overseeing three daughter
companies Platin - Investment - owner of the Messer-Phone, and other registered
trade marks. Platin - Marketing and Advertisement (1989) Ltd., operating a
commercial advertisement office, and Style - Manages & Operates several
customers clubs for major credit cards companies like AMX and Mastercard
 each has around 500,000 members. Mr. Hason brings expertise in business
and marketing, with a strong emphasis on the Israeli markets for the VGTel
products.  Mr. Hason is a related party.
  Mr.
Hason's Educational Background:
 Technicum,
Givataim, Israel
 B.Sc.
Architecture 1983
 
 Niva
Kallus, Age 23  Corporate Secretary , Director.
  On
January 18, 2006 Niva Kallus was appointed as Corporate Secretary, and Director.
Niva is the daughter of Ron Kallus. Niva has just completed her Pre-med
Undergraduate studies (Psychology Major) at the University of Massachusetts,
From Sep. 2002 to July 2003 Niva studied, to become a registered EMS at Oakland
CA. From (August) 2001 to (August) 2002, Niva established a new Scout
organization in Kiryat-Gat, Israel From (Sep.) 1996 - -(June) 2001 She attended
Zevulun-Carmel High School, Kibbutz Yagur, Israel (Graduation June 2001.) Niva
has no prior business experience.
 
 Educational Background:
 
  ·
                      University
      of Massachusetts, Lowell, MA. 2008
 
 ·
                      First
      Aid, Emergency Medical Services Authority, CA
  (2002)
 
 ·
                      CPR,
      American Heart Association (2002)
 
 ·
                      EMT
      training program, Merritt College, Oakland, CA
  (2003)
 
 ·
                      CPR
      Instructor course, Chelmsford police Department
  (2004)
    15
  Item 10: Executive Compensation:
   ANNUAL
      COMPENSATION
                  LONG
      TERM COMPENSATIONNAME
                  TITLE
                  YEAR
                  SALARY
                  BONUS
                  OTHER
      ANNUAL COMPENSATION
                  RESTRICTED
                    OPTION
      STOCKS/
                    PAYOUTS
      AWARDED
                  SARS
                    ($)
                  LTIP
                    COMPENSATION
                  ALL
      OTHER COMPENSATIONRon
      Kallus
                    (1)
                  President
                    CEO
      and
                    Chairman
                    Director
                  2007
                  $56,000
                    
                    (4)
                  0
                  0
                  0
      (1)
                  0
                  0
                  0Israel
      Hason
                    
                    (2)
                  VP
                    Director
                  2007
                  0
                  0
                  0
                  0
                  0
                  0
                  0Niva
      Kallus
                    
                    (3)
                  Secretary
                    Director
                  2007
                  0
                  0
                  0
                  0
                  0
                  0
                  0Ron
      Kallus
                    
                    (1)
                  President
                    CEO
                    Chairman
                    Director
                  200
                  $56,000
                    
                    (4)
                  0
                  0
                  0
                  0
                  0
                  0Israel
      Hason
                    
                    (2)
                  VP
                    Director
                  2006
                  0
                  0
                  0
                  0
                  0
                  0
                  0Niva
      Kallus
                    
                    (3)
                  Secretary
                    Director
                  2006
                  0
                  0
                  0
                  0
                  0
                  0
                  0
 
  (1) Ron
Kallus  received 750,000  shares of our common stock
pursuant to the acquisition  agreement between  Tribeka Tek,
Inc. and NYN International LLC.   Such shares were not for
services rendered or to be rendered by
Kallus.  Additionally  each of Mr. Kallus' sons, Yoav Kallus
and Nathan Kallus respectively received 420,000 shares of stock pursuant to the
acquisition  agreement between  Tribeka Tek, Inc. and NYN
International LLC.   Such shares were not for services rendered
or to be rendered by Mr. Kallus or his sons.  Neither Yoav Kallus nor
Nathan Kallus are officers or directors of the Company.
  (2)  Israel
Hason received 750,000  shares of our common stock pursuant to the
acquisition  agreement between  Tribeka Tek, Inc. and NYN
International LLC.   Such shares were not for services rendered
or to be rendered by Mr. Hason.
 
 (3)  Niva
Kallus received 420,000 shares of our common stock pursuant to the acquisition
agreement between Tribeka Tek, Inc. our predecessor firm and NYN International
LLC.  Such shares were not for services rendered or to be rendered by
Niva Kallus.  Niva Kallus is the daughter of Ron Kallus.
 
 (4) 
The sums of $56,000 and $56,000 respectively were officers compensation and rent
expenses incurred,  but not paid out.  These sums were credited to
Additional Paid in Capital.  ( See Financial Statements Note 9
 and Note 10.)
 
 Option/SAR Grants
  We do not
currently have a stock option plan. No individual grants of stock options,
whether or not in tandem with stock appreciation rights known as SARs or
freestanding SARs have been made to any executive officer or any Director since
our inception; accordingly, no stock options have been granted or exercised by
any of the officers or Directors since we were founded.
  Long-Term
Incentive Plans and Awards
  We do not
have any long-term incentive plans that provide compensation intended to serve
as incentive for performance. No individual grants or agreements regarding
future payouts under non-stock price-based plans have been made to any executive
officer or any Director or any employee or consultant since our inception;
accordingly, no future payouts under non-stock price-based plans or agreements
have been granted or entered into or exercised by any of the officers or
Directors or employees or consultants since we were founded.
  Compensation
of Directors
  There are
no arrangements pursuant to which Directors are or will be compensated in the
future for any services provided as a Director.
 
 Employment
Contracts, Termination of Employment, Change-in-Control
Arrangements
  There are
currently no employment or other contracts or arrangements with officers or
Directors. There are no compensation plans or arrangements, including payments
to be made by us, with respect to our officers, Directors or consultants that
would result from the resignation, retirement or any other termination of such
Directors, officers or consultants from us. There are no arrangements for
Directors, officers, employees or consultants that would result from a
change-in-control.
   16
  Item 11:Security Ownership of Certain Beneficial Owners and
Management
  The
following table sets forth information regarding the beneficial ownership of
shares of the Company's Common Stock as of   August 22, 2007
by
 (1) all
directors and executive officers of the Company, individually and collectively
as a group
 (2) all
stockholders known to the Company to be beneficial owners of more than five
percent (5%) of the outstanding Common Stock;
   
 TITLE
      OR
                      CLASS
      OF
                      SECURITIES
                    NAME 
      OF BENEFICIAL OWNER
                    AMOUNT
      OF BENEFICIAL OWNERSHIP BEFORE
                      STOCK
      OFFERING (2)
                    AMOUNT
      OF BENEFICIAL OWNERSIP AFTER
                      STOCK
      OFFERING
                    PERCENT
      OF CLASS
                      BEFORE
                      OFFERING
                    PERCENT 
      OF CLASS
                      AFTER
                      STOCK
                      OFFERINGCommon
                    Ron
      Kallus
                    750,000
      (1)  (2)
                    750,000
                    15.625%%
                    15.625%Common
                    Niva
      Kallus
                    420,000
      (1)  (2)
                    420,000
                    8.75%
                    8.75%Common
                    Yoav
      Kallus
                    420,000
      (1)  (2)
                    420,000
                    8.75%
                    8.75%Common
                    Nathan
      Kallus
                    420,000
      (1)  (2)
                    420,000
                    8.75%
                    8.75%Common
                    Israel
      Hason
                    750,000
      (1)  (2)
                    750,000
                    15.625%
                    15.625%Common
                    Hyman
      & Ethel
                      Schwartz
                    542,510   
       (2)
                    542,510
                    11.30%
                    11.30%Common
                    National
      Theological Center
                    251,878   
       (2)
                    251,878
                    5.2
      %
                    5.2%Common
                    Yeshiva
      Tov
                      Vechesed
                    251,878  
       (2)
                    251,878
                    5.2%
                    5.2%Common
                    Brain
      & Power Ltd.
                    400,000  
      (2)
                    400,000
                    8.33%
                    8.33%Directors
      &
                      Officers
      as a
                      Group
                    
                    2,760,000
                    2,760,000
                    57.5%
                    57.5%
   (1)
      (2)
                    Niva
      Kallus is the daughter of Ron Kallus.(1)
      (2)
                    Yoav 
      Kallus is the sons of Ron Kallus.
 
 (1)
                      (2)
                    Nathan 
      Kallus is the son of Ron Kallus
 
 Israel
Hason is the Chief Marketing Officer. He is also a managing partner and
principal of Platin Ltd. Israel. Platin Ltd. is a telemarketing company that
is currently the only customer of VGTel Inc. Mr. Hason has agreed to
recuse himself from any corporate decision relating to Platin Ltd business
relationship with VGTel, Inc.
  Pursuant
to the rules and regulations of the Securities and Exchange Commission, shares
of Common Stock that an individual or entity has a right to acquire within 60
days pursuant to the exercise of options or warrants are deemed to be
outstanding for the purposes of computing the percentage ownership of such
individual or entity, but are not deemed to be outstanding for the purposes of
computing the percentage ownership of another person or entity shown in the
table.
  None of
the principals have outstanding options or warrants or other securities
convertible into the Common Stock of the Company.
 Item 12:Certain Relationships and Related
Transactions
  Niva
Kallus is the corporate secretary and the daughter of Ron Kallus, the CEO of the
Company.
  Israel
Hason is the Chief Marketing Officer of our Company and a Director. Mr. Hason is
also the managing partner and principal shareholder of Platin Ltd. Israel.
Platin Ltd. is a telemarketing company that is our only customer to date. In
January 2006 Platin Ltd. placed an order for our telemarketing services for the
upcoming election in Israel which was scheduled for March 28, 2006. Platin has
been using our System ever since for both political campaigns and for commercial
telemarketing services they provide to a variety of their clients. We charge
Platin a monthly per line cost of $3.0 plus a usage fee of $0.012 per message
while the GMG system is in the testing phase.  For the twelve months ending
March 31, 2007, we generated $ 19,386 and during the fiscal year
ended March 31, 2008 we generated revenues of $15,840
from Platin.   Consequently, the aggregate revenues we generated
to date from our only customer, Platin Ltd. is $41,547. Platin
 pays a monthly fee for the lines and a per call fee for each successful
call placed.   Platin is a related party.    Platin Ltd., is
a related party.  Israel Hason is the Chief Marketing Officer of our
Company and a Director. Mr. Hason is also the managing partner and principal
shareholder of Platin Ltd. Israel.   Mr. Hason has agreed to
recuse himself from any corporate decision relating to Platin Ltd business
relationship with VGTel, Inc.
   On March
1, 2006, Ron Kallus, the Company Chief Executive Officer and Principal
shareholder provided a credit facility to the Company up to a maximum of $20,000
which may be drawn down anytime from March 1, 2006 until May 18, 2007. This
unsecured loan is payable May 18,  2007 and bears an interest rate of prime
plus one (1) calculated on an annual basis payable annually in arrears with
first payment due March 1, 2007 and second payment due May 18, 2007, unless
extended by mutual consent of the parties.
  On July
18, 2006, Mr. Kallus executed an amendment to the March 1, 2006 credit facility
increasing the total amount of the credit facility from $20,000 to $50,000 and
extending payable date from May 18, 2007 to December 31, 2007 with the first
interest payment due July 1, 2007 and second payment due December 31,
2007.  On May 22, 2007 in a second   addendum to the Loan
Agreement  was signed between Mr. Kallus and the Company waiving all
interest  payments for  loan
facility,  retroactively from the  March 1,
2006  and declaring the loan facility as interest free.  The
Officer had previously forgiven his right to the interest for the March 31,
2006 loan thus no interest has been charged or accrued.
 
 In
the fiscal year ended March 31, 2006, Mr. Kallus advanced the sum of $4,233
pursuant to this credit facility.  As of March 31, 2007 Mr. Kallus advanced
an additional $  12,090 for an aggregate of $16,323.  The Officer
has forgiven his right to the interest for the March 31,
2006 loan thus  no interest has been charged or
accrued.
  Ethel
Schwartz former President and Ron Kallus current CEO are both officers and
directors of a private R&D company, Digital Power Technologies, Inc. There
are no business relationships or synergies between Digital Power Technologies
and VGTel Inc.  Both of these entities operate in different industries and
sectors that have no relationship with each other. There is no plan for the
companies to have relationships in the future.
  Except as
provided herein, the Company has not entered into any transactions with a
related party. Management does not know of any other transaction it will be
entering into with related parties.
  The
Company has had no transactions with any promoter or promoters since its
inception. Nothing of value, including money, property, contracts, options or
rights of any kind has been received or will be received by a promoter, director
or indirectly from the Company which is not disclosed.
   Item 13:  Exhibits on Form
8K
  On May
28, 2008 we filed an 8K Form disclosing the following:
  On May
28, 2008 the Registrant sold in a private placement transaction an aggregate
$24,000 of Series A Units of its securities, at a price of $.025 per unit. Each
Series A unit consists of One share of the Company's Common stock, One Series A
Warrant, One Series B Warrant, One Series C Warrant and One Series D Warrant.
Each of the four series of warrants entitles the holder to purchase one share of
the Company's Common Stock at an exercise price of $0.25 per Share. The private
placement was exempt from registration under Section 4(2) of the Securities Act
of 1933, as amended, and Rule 506 of Regulation D promulgated thereunder,
inasmuch as the securities were sold to accredited investors only. The shares
will bear a 144 Restrictive legend. The Company has not offered Registration
Rights to the subscriber.
  On May
28, 2008 the Registrant issued 674,000 shares for services rendered valued at
$16,850 in lieu of cash. The shares issued are restricted shares and are subject
to Rule 144.
 Item 14:  Principal Accountant
Fees & Services:
  The aggregate fees billed by N. Blumenfrucht CPA,
P.C. to the Company for the years ended March 2008 and 2007 was
$24,000.
 
 17
    
    
  Report of Independent Registered
      Public Accounting Firms
                  F-1Balance Sheets as ofSeptember 30, 2007and 2006.
                  F-2Statements ofOperations  September 30,
      2007 and 2006
                  F-3Statements of Cash Flows for the
      years endedSeptember 30, 2007 and
      2006.
                  F-4Statements of Shareholders'
      Equity for the years ended September 30, 2007 and
    2006
                  F-5Notes to Financial
      Statements
                  F-6
 
  
 N.
Blumenfrucht CPA PC
 1040
East 22nd
Street
 Brooklyn
New York 11210
 Tel.-
718-692-2743
 Fax
-718-692-2203
 
 
 
 
 The Board
of Directors and Stockholders
 VGTel
Inc.
 
 We have
audited the accompanying balance sheets and statements of stockholders' equity
of VGTel Inc. (formerly NYN Inc.) as of March 31, 2008 and 2007, and the related
statements of operations and cash flows for the years ended March 31, 2008 and
2007 and for the periods July 27, 2004 (inception)  through March 31,
2008 These financial statements are the responsibility of the Company’s
management. Our responsibility is to express an opinion on these financial
statements based on our audits.
 
 We
conducted our audits in accordance with standards of the Public Company
Oversight Board (United States) Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. The Company is not required to have, nor were
we engaged to perform, an audit of its internal control over financial
reporting. An audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the 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 audits provide a reasonable basis for our
opinion.
 
 In our
opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of VGTel Inc. as of March 31, 2008 and
2007 and the related statements of operations and cash flows for the years ended
March 31, 2008 and 2007 and for the  period July 27, 2004 (inception)
through March 31, 2008 in conformity with accounting principles generally
accepted in the United States.
 
 As
disclosed  in Note 4, the accompanying financial statements have been
prepared assuming that the Company will continue as a going concern. The Company
is a development stage company and has had losses since inception, which raises
substantial doubt about its ability to continue as a going concern. The
financial statements do not include any adjustments that might result from the
outcome of this uncertainty
 
 /s/ N.
Blumenfrucht CPA PC
  Brooklyn
New York
 June 26,
2008
    F-1
  VGTel,
Inc.
 (A
Development Stage Company)
 Balance
Sheet
 As
as
 March
      31,
                  
                  
                  
                  
                  
                  March
      31,2008
                  
                  
                  
                  
                  
                  2007ASSETSCURRENT
      ASSETSCash
      and cash equivalents
                  
                  $
                  5,126
                  
                  
                  
                  
                  
                  $
                  7,179Accounts
      receivable
                  
                  
                  1,232
                  
                  
                  
                  
                  
                  
                  3,504Total
      Current Assets
                  
                  
                  
                  
                  
                  $
                  6,358
                  
                  
                  
                  
                  
                  
                  $
                  10,683FIXED
      AND OTHER ASSETSProperty
      and equipment
                  
                  
                  4,744
                  
                  
                  
                  
                  
                  
                  
                  4,744less:
      Accumulated depreciation
                  
                  
                  (4,744
                  )
                  
                  
                  
                  
                  
                  
                  (4,744
                  )Net-
      Property and equipment
                  
                  
                  0
                  
                  
                  
                  
                  
                  
                  
                  0Intellectual
      property
                  
                  
                  29,000
                  
                  
                  
                  
                  
                  
                  
                  29,000less:
      Accumulated amortization
                  
                  
                  (13,050
                  )
                  
                  
                  
                  
                  
                  
                  (7,250
                  )Net
      -Intellectual property
                  
                  
                  15,950
                  
                  
                  
                  
                  
                  
                  
                  21,750Deferred
      tax asset
                  
                  
                  0
                  
                  
                  
                  
                  
                  
                  
                  0Total
      Fixed and Other Assets
                  
                  
                  
                  
                  
                  
                  15,950
                  
                  
                  
                  
                  
                  
                  
                  21,750Total
      Assets
                  
                  
                  
                  
                  
                  $
                  22,308
                  
                  
                  
                  
                  
                  
                  $
                  32,433LIABILITIES AND STOCKHOLDERS'
      EQUITYCURRENT
      LIABILITIESAccrued
      expenses and accounts payable
                  
                  $
                  34,027
                  
                  
                  
                  
                  
                  
                  $
                  14,631Due
      to shareholders
                  
                  
                  16,323
                  
                  
                  
                  
                  
                  
                  
                  16,323Total
      Current Liabilities
                  
                  
                  
                  
                  
                  $
                  50,350
                  
                  
                  
                  
                  
                  
                  $
                  30,954COMMITMENTS
      AND CONTINGENCIESSTOCKHOLDERS'
      EQUITYPreferred
      Stock,, $.001 par value,Authorized
      10,000,000 shares, none issued
                  
                  
                  0
                  
                  
                  
                  
                  
                  
                  
                  0Common
      stock, $ .0001  par value ,Authorized
      200,000,000  shares Issued  &outstanding  4,800,000
      ,
                  
                  
                  480
                  
                  
                  
                  
                  
                  
                  
                  480Additional
      paid in capital
                  
                  
                  213,020
                  
                  
                  
                  
                  
                  
                  
                  157,020Accumulated
      other comprehensive  gain (loss)
                  
                  
                  0
                  
                  
                  
                  
                  
                  
                  
                  0Retained
      Earnings (Deficit)
                  
                  
                  (241,542
                  )
                  
                  
                  
                  
                  
                  
                  (156,021
                  )Total
      Stockholders' Equity
                  
                  
                  
                  
                  
                  
                  (28,042
                  )
                  
                  
                  
                  
                  
                  
                  1,479Total
      Liabilities and Stockholders' Equity
                  
                  
                  
                  
                  
                  $
                  22,308
                  
                  
                  
                  
                  
                  
                  $
                  32,433
   See
accompanying notes to financial statements
 F-2
 
 
 VGTel,
Inc.
 (A
Development Stage Company)
 Statement
of Cash Flow
 For
the Periods
 
 
  
 AccumulatedFrom
      InceptionApril
      1, 2007-
                  
                  
                  April
      1, 2006-
                  
                  
                  July
      27, 2004-March 31, 2008
                  
                  
                  March 31, 2007
                  
                  
                  March 31, 2008Cash
      flows from operating activitiesNet  Income
      (loss)
                  
                  $
                  (85,521
                  )
                  
                  $
                  (99,595
                  )
                  
                  $
                  (241,542
                  )Adjustments
      to reconcile net loss to netcash
      provided by operating activities:Depreciation
      and amortization
                  
                  
                  5,800
                  
                  
                  
                  5,800
                  
                  
                  
                  13,050Officers
      compensation
                  
                  
                  56,000
                  
                  
                  
                  56,000
                  
                  
                  
                  127,000Changes
      in assets and liabilities:Accounts
      receivable
                  
                  
                  2,272
                  
                  
                  
                  3,317
                  
                  
                  
                  (1,232
                  )Accrued
      expenses
                  
                  
                  19,395
                  
                  
                  
                  12,631
                  
                  
                  
                  34,027Officers
      loans
                  
                  
                  0
                  
                  
                  
                  12,100
                  
                  
                  
                  16,323Net
      cash provided ( used)  in operating activities
                  
                  
                  (2,054
                  )
                  
                  
                  (9,747
                  )
                  
                  
                  (52,374
                  )Cash
      flows from investing activitiesPurchase  of
      fixed assets & Intellectual property
                  
                  
                  0
                  
                  
                  
                  0
                  
                  
                  
                  (29,000
                  )Net
      cash provided (used) in investing  activities
                  
                  
                  0
                  
                  
                  
                  0
                  
                  
                  
                  (29,000
                  )Cash
      flows from financing activitiesSale
      of common stock
                  
                  
                  0
                  
                  
                  
                  
                  
                  
                  
                  10,000Additional
      paid in capital credited for shareholder contributions
                  
                  
                  0
                  
                  
                  
                  
                  
                  
                  
                  66,500Issuance
      of common stock in exchange for services rendered
                  
                  
                  0
                  
                  
                  
                  10,000
                  
                  
                  
                  10,000Net
      cash provided (used)  by financing activities
                  
                  
                  0
                  
                  
                  
                  10,000
                  
                  
                  
                  86,500Net
      increase  (decrease ) in cash
                  
                  
                  (2,054
                  )
                  
                  
                  253
                  
                  
                  
                  5,126Cash
      and cash equivalents, beginning of period
                  
                  
                  7,180
                  
                  
                  
                  6,926
                  
                  
                  
                  0Cash
      and cash equivalents, end of period
                  
                  $
                  5,126
                  
                  
                  $
                  7,179
                  
                  
                  $
                  5,126Supplemental
      disclosuresNoncash
      investing and financing activities:Additional
      paid in capital credited in exchange of Intellectual
    property
                  
                  $
                  0
                  
                  
                  $
                  0
                  
                  
                  $
                  66,500Officers
      Compensation credited to additional paid in capital
                  
                  $
                  0
                  
                  
                  $
                  56,000
                  
                  
                  $
                  127,000Issuance
      of common stock in exchange for services rendered
                  
                  
                  
                  
                  
                  $
                  10,000
                  
                  
                  $
                  10,000
  See
accompanying notes to financial statements
  F-3
 
 
 VGTel,
Inc.
 (A
Development Stage Company)
 Statement
of Operations
 For
the Periods
 
 
 Accumulatedfrom
      inceptionApril
      1, 2007-
                  
                  
                  April
      1, 2006-
                  
                  
                  (July
      27, 2004)-March 31, 2008
                  
                  
                  March 31, 2007
                  
                  
                  March 31, 2008REVENUES
                  
                  $
                  15,840
                  
                  
                  $
                  19,386
                  
                  
                  $
                  41,547OPERATING
      EXPENSESGeneral   and
      administrative
                  
                  
                  39,561
                  
                  
                  
                  57,181
                  
                  
                  
                  142,125Officers'
      compensation & rent
                  
                  
                  56,000
                  
                  
                  
                  56,000
                  
                  
                  
                  127,000Depreciation
      and amortization
                  
                  
                  5,800
                  
                  
                  
                  5,800
                  
                  
                  
                  13,285Total
      operating expenses
                  
                  
                  101,361
                  
                  
                  
                  118,981
                  
                  
                  
                  282,410Income
      (loss) from operations
                  
                  
                  (85,521
                  )
                  
                  
                  (99,595
                  )
                  
                  
                  (240,863
                  )OTHER
      INCOMEInvestment
      income
                  
                  
                  0
                  
                  
                  
                  0
                  
                  
                  
                  0Loss
      before income taxes
                  
                  
                  (85,521
                  )
                  
                  
                  (99,595
                  )
                  
                  
                  (240,863
                  )Federal
      Income Tax
                  
                  
                  0
                  
                  
                  
                  0
                  
                  
                  
                  0NET
      INCOME (LOSS)
                  
                  
                  (85,521
                  )
                  
                  $
                  (99,595
                  )
                  
                  $
                  (240,863
                  )Discontinued
      OperationsLoss
      from discontinued operations
                  
                  
                  0
                  
                  
                  
                  0
                  
                  
                  
                  (679
                  )Income
      tax benefit
                  
                  
                  0
                  
                  
                  
                  0
                  
                  
                  
                  0Net
      Loss from Discontinued operations
                  
                  
                  0
                  
                  
                  
                  0
                  
                  
                  
                  (679
                  )NET
      INCOME (LOSS)
                  
                  $
                  (85,521
                  )
                  
                  $
                  (99,595
                  )
                  
                  $
                  (241,542
                  )INCOME
      (LOSS) PER COMMON SHARE-Basic
      and Diluted
                  
                  $
                  (0.02
                  )
                  
                  $
                  (0.02
                  )
  
 See
accompanying notes to financial statements
  F-4
  VGTel,
Inc.
 (A
Development Stage Company)
 Statement
of Shareholders Equity
 For
the Periods
 Retained
                  
                  
                  AccumulatedAdditional
                  
                  
                  Earnings
                  
                  
                  OtherCommon
                  
                  
                  Stock
                  
                  
                  Paid-in
                  
                  
                  (Accumulated
                  
                  
                  ComprehensiveShares
                  
                  
                  Amount
                  
                  
                  Capital
                  
                  
                  Deficit)
                  
                  
                  Loss
                  
                  
                  TotalsBalances,
      July 27, 2004
                  
                  
                  0
                  
                  
                  $
                  0
                  
                  
                  $
                  0
                  
                  
                  $
                  0
                  
                  
                  $
                  0
                  
                  
                  $
                  0Intellectual
      property contributed by officers
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  66,500
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  66,500Issuance
      of shares to incorporators and others
                  
                  
                  4,000,000
                  
                  
                  
                  400
                  
                  
                  
                  (400
                  )
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  0Units
      sold February 2006
                  
                  
                  400,000
                  
                  
                  
                  40
                  
                  
                  
                  9,960
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  10,000Officers'  compensation
      charged
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  15,000
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  15,000Net
      loss for year ended March 31, 2006
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  (56,426
                  )
                  
                  
                  
                  
                  
                  
                  (56,426
                  )Balances,
      March 31, 2006
                  
                  
                  4,400,000
                  
                  
                  
                  440
                  
                  
                  
                  91,060
                  
                  
                  
                  (56,426
                  )
                  
                  
                  0
                  
                  
                  
                  35,074Issuance
      of shares for services rendered May 2006
                  
                  
                  400,000
                  
                  
                  
                  40
                  
                  
                  
                  9,960
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  10,000Officers'  compensation  &
      rent charged
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  56,000
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  56,000Net
      loss for year ended March 31, 2007
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  (99,595
                  )
                  
                  
                  
                  
                  
                  
                  (99,595
                  )Balances,
      March 31, 2007
                  
                  
                  4,800,000
                  
                  
                  
                  480
                  
                  
                  
                  157,020
                  
                  
                  
                  (156,021
                  )
                  
                  
                  0
                  
                  
                  
                  1,479Officers'  compensation  &
      rent charged
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  56,000
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  56,000Net
      loss for year ended March 31, 2008
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  (85,521
                  )
                  
                  
                  
                  
                  
                  
                  (85,521
                  )Balances,
      March 31, 2008
                  
                  
                  4,800,000
                  
                  
                  $
                  480
                  
                  
                  $
                  213,020
                  
                  
                  $
                  (241,542
                  )
                  
                  $
                  0
                  
                  
                  $
                  (28,042
                  )
 
 See
accompanying notes to financial statements
    F-5
 VGTel
Inc.
 (A
Development Stage Company)
 Notes to
Financial Statements
 March 31,
2008
  
 
  
 NOTE 1 -
FORMATION AND BUSINESS OF THE COMPANY.
  VGTel
Inc. (formerly known as Tribeka-Tek Inc.) (The “Company) was organized on
February 5, 2002 in the State of New York. Tribeka-Tek Inc. was engaged in the
business of providing Edgarizing services for publicly traded companies filing
through the Edgar system. On January 18, 2006 the Company purchased from NYN
International LLC its intellectual property assets pertaining to the GMG System,
a telemarketing campaing product. Tribeka Tek, Inc. was a minimally operating
corporation with nominal assets. Pursuant to the terms of the Acquisition
Agreement, the Company issued to NYN shareholders and designees 2,760,000 newly
issued shares of VGTel Inc. (formerly Tribeka Tek, Inc). At the time of the
acquisition, the 2,760,000 shares represented approximately 70% of the
outstanding shares of the Company, which resulted in the stockholders of NYN
obtaining control of the Company.
  The
merger has been accounted for as a reverse acquisition using the purchase method
of accounting. NYN International, Inc. has been treated as the acquiring company
for accounting purposes under Statement of Financial Accounting Standards
(“SFAS”) No. 141, “Business Combinations. As a result of the reverse
acquisition, the statements of operations presented herein include the results
of NYN International for the years ended March 31, 2006-2008, and include the
results of Tribeka Tek for the period from date of acquisition (January 18, 2006
) to March 31, 2006). Although NYN International was formed in July of 2004
there was no activity prior to April 2005, thus the results for the  fiscal
periods  reflect results from inception.
 
 Because
NYN International LLC is treated as the acquirer for accounting purposes, the
equity accounts are adjusted for the share exchange and carried forward. Prior
accumulated deficits of NYN International LLC are adjusted to additional paid in
capital therefore carrying forward the accumulated deficit or earnings of NYN
International LLC. As these are the first periods with activity there was
no beginning accumulated deficit or earnings,  and ending retained deficit
reflects the retained deficit for the current period.
 
 The
common stock per share information in the consolidated financial statements and
related notes have been retroactively adjusted to give effect to the reverse
acquisition on January 18, 2006 for all periods presented.
  On
January 18, 2006 the Company changed its name to VGTel Inc. As of the periods
stated the Company had generated minimal revenues and is considered a
development stage company.   As of February 2006 the Company has
ceased its Edgarizing operations and is concentrating its efforts in the
development of its intellectual properties.   As  a result of the
acquistion of the GMG System, the company is now operating in the telemarketing
sector of the telecommunications industry.
  
 NOTE 2
-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 
 Fiscal
year
 
 The
Company has chosen March 31, as its fiscal year end.
   USE OF
ESTIMATES:
  The
preparation of financial statements in conformity with general accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amount of assets and liabilities, revenue and expenses as
well as the disclosure of contingent assets and liabilities in the financial
statements. Actual results could differ from those estimates.
  Cash and
cash equivalents
  Cash and
cash equivalents consists of cash, money market funds and other highly liquid
investments with a maturity of three months or less from the date of purchase.
The Company has not experienced any losses on its cash or cash
equivalents.
 
  INVESTMENTS:
  Investments
include marketable common stock securities traded on the stock exchange. The
marketable securities are classified as available for sale, and are measured at
fair value in the balance sheet. Unrealized gains and losses on investments are
recorded net of tax as a separate component of stockholders’ equity. Gains and
losses on securities sold are determined based on the specific identification
method.
  PROPERTY
AND EQUIPMENT
  Property
and equipment (primarily computer hardware) are recorded at cost and depreciated
or amortized over the estimated useful lives of the assets (three to five years)
using the accelerated depreciation method allowed by the Internal Revenue
Code.
   NOTE 3
-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
   REVENUE
RECOGNITION
 
 The
Company recognizes revenue on arrangements in accordance with Securities and
Exchange Commission Staff Accounting Bulletin No. 101, “Revenue Recognition in
Financial Statements” and SAB No. 104, “Revenue Recognition”. In all cases,
revenue is recognized only when the price is fixed or determinable, persuasive
evidence of an arrangement exists, the service is performed and collectibles is
reasonably assured.
 
 For
Platin Ltd., our sole  current client to date,  the company does
not  generate an invoice or recognize revenues  for services
until  the  requested services have been provided to Platin and
accepted by Platin.
   EARNINGS
(LOSS) PER SHARE
  In
accordance with Statement of Financial Accounting Standards No. 128, “Earnings
Per Share”, the computation of net loss per share is based upon the weighted
average number of common shares issued and outstanding for the reporting period.
Common stock equivalents related to options, warrants and convertible securities
are excluded
    F-6
   DISCONTINUED
OPERATIONS
 
 During
the period ended March 31, 2006 the Company ceased its Edgarizing
operations.    The Statement of Operations for the period
recognized revenues of $840 and expenses of $1,519 for a net loss of $679 from
the Edgarizing business.
   FASB No.
86
  The
Company has incurred significant costs in the development of its program. The
costs, which were incurred by the Company, were segregated between pre
technological feasibility costs and post technological feasibility costs. It is
estimated that the useful life of this asset should approximate five years.
Under FASB No. 86, once technological feasibility has been established, all
software production costs are capitalized and reported at the lower of
unamortized cost or net realizable value. When the product is available for
general use amortization begins and all further maintenance costs are
expensed.
  The
Company  determined that technological feasibility has been established for
our GMG System when we completed all planning, designing, coding, and testing
activities that were necessary to establish that the GMG System can be produced
to meet its design specifications including functions, features, and technical
performance requirements.
   RECENT
ACCOUNTING PRONOUNCEMENTS
  The
Financial Accounting Standards Board (FASB) issued FASB 133, “Accounting for
Derivative Instruments and Hedging Activities”, The Company does not engage in
derivative or hedging activities and does not expect the adoption of this new
pronouncement to have a material effect, if any, on its financial condition or
results of operations.
  In May
2003, the FASB issued SFAS 150, "Accounting for Certain Financial Instruments
with Characteristics of Both Liabilities and Equity." SFAS 150 changes the
accounting for certain financial instruments that under previous guidance
issuers could account for as equity. It requires that those instruments be
classified as liabilities in balance sheets. The guidance in SFAS 150 is
generally effective for all financial instruments entered into or modified after
May 31, 2003, and otherwise is effective on July 1, 2003. The adoption of SFAS
150 did not impact the financial position, cash flows or results of
operations.
  In
December 2003, the SEC issued SAB 104. This staff accounting bulletin revises or
rescinds certain sections of SAB 101, which gives interpretation guidance about
revenue recognition. SAB 104 makes the interpretive guidance of SAB 101
consistent with current authoritative accounting and auditing guidance and SEC
rules and regulations. The adoption of SAB 104 in the fourth quarter of fiscal
2004 did not impact the financial position, cash flows or results of
operations.
   NOTE 4-
LIQUIDITY & PROFITABILITY- GOING CONCERN
  The
Company has had no significant income since inception, which raises substantial
doubt about its ability to continue as a going concern. The continuation of the
Company as a going concern are dependent upon the Company’s ability to obtain
additional financing and upon future profitable operations.
  NOTE 5
-INCOME TAXES
  The
Company accounts for income taxes in accordance with Statement of Financial
Accounting Standards No. 109 , (SFAS 109) “ Accounting for Income Taxes.” Under
the asset and liability method, deferred income taxes are recognized for the tax
consequences of “temporary differences” by applying enacted statutory tax rates
applicable to future years to differences between the financial statements
carrying amounts and the tax bases of existing assets and liabilities. Under
SFAS 109, deferred tax assets may be recognized for temporary differences that
will result in deductible amounts in future periods. A valuation allowance is
recognized, if on the weight available evidence, it is more likely than not that
some portion or the entire deferred tax asset will not be realized.
 
 NOTE 6
-INTELLECTUAL PROPERTY
  The
Company developed the intellectual properties known as Group Messaging
Gateway.   As of December 31, 2007 total costs associated
 with the development of the GMG System was $98,500 .   It has
been determined that of this amount $29,000 had been incurred after
technological feasibility has been reached. All costs prior to technological
feasibility have been expensed.   All post development costs have been
expensed in the periods incurred. The asset valued at $29,000 is being amortized
over a sixty-month period.
  The
costs, which were incurred by the Company in the development of the program,
were segregated between pre technological feasibility costs and post
technological feasibility costs. It is estimated that the useful life of this
asset should approximate five years. Under FASB No. 86, once technological
feasibility has been established, all software production costs are capitalized
and reported at the lower of unamortized cost or net realizable value. When the
product is available for general use amortization begins and all further
maintenance costs are expensed.
  NOTE
7-ACCRUED EXPENSES
  Accrued
expenses include professional fees payable and monies due to
vendors.
 
 NOTE
8-DUE TO SHAREHOLDERS
  Various
funds had been advanced by the CEO, Mr. Ron Kallus  to the
company.  As of March 31, 2008 Mr. Kallus has advanced an aggregate of
$16,323.  The Officer has forgiven his right to the interest for the March
31, 2006 loan thus  no interest has been charged or
accrued
 
 NOTE
9-OFFICERS ' COMPENSATION
  The
Officer has taken no actual compensation since inception. For financial
statement purposes  the Statement of Operations -officers compensation has
been charged for $50,000 each  for the years ended March 31, 2008 and
2007 respectively.
   NOTE
10-COMMITMENTS AND CONTINGENCIES
  The
Company is occupying the premises of its President rent free.  For
financial statement purposes  the Statement of Operations -rent has been
charged for $6,000 for the annual  periods ended March 31,
 2008 and 2007, respectively.   Additional paid in capital has
been credited for the corresponding amount.
  The
company signed various contracts to build a Global Messaging Gateway (GMG) and
for hosting its servers. This is a web-hosted application, which provides
message-broadcasting facility, for business to business, personal,
telemarketing, alerting and many more applications.
  The
company has an obligation to repay the loan to Mr. Kallus pursuant to the
Officer's loan agreement.   .
 As of
March 31, 2008 Mr. Kallus advanced  an aggregate of $16,323.  The
Officer has forgiven his right to the interest for the March 31,
2006 loan thus  no interest has been charged or
accrued.
 
 In
addition the Company is providing its services to a telemarketing company in
Israel that is distributing the services to telemarketing clients in
Israel.  The services are being provided to Platin, which is a related
party to the Company.
  Legal
Proceedings
  There are
no material legal proceedings to which the Company is a party to or which any of
their property is subject.
  NOTE 11-
STOCKHOLDERS’ EQUITY
  NYN
International, LLC  (the accounting acquiror) was organized as a
Limited Liability Company in the State of Texas.  No shares were issued to
its founders.
  Tribeka
Tek, Inc, (the legal acquiror) was organized in the State of New York
on February 5, 2002.  Tribeka Tek, Inc. authorized 1500 common shares
par value $1.00.  In February 2002 Tribeka Tek, Inc. issued 1500
common shares par value $1.00.  to its founders.    On June
29, 2005 Tribeka Tek board of directors voted to increase the common Shares
authorized from 1500 to 200,000,000 and decrease the par value from $1.00
to $0.0001.  On January 18, 2006 the Company authorized a forward split of
826.67 for each share outstanding, bringing the total issued and
outstanding shares from 1,500 to 1,240,000.   On January 18, 2006 the
Company issued 2,760,000 restricted common shares par value $0.0001 per
share  to shareholders of NYN International LLC in exchange for the rights
to its intellectual properties, bringing the total shares issued and outstanding
to 4,000,000.
    F-7
  In
February 2006 the Company offered 800,000 Series A Units at $.025 per Unit to
accredited and non-accredited investors in a private placement offering pursuant
to Regulation D 506. Each Series A Units consists of (i) 1 share of the
Company's common stock, $.0001 par value ("Common Stock") and (ii) 1 Series A
(iii) 1 Series B (iv) 1 Series C (v) and 1 Series D Common Stock Purchase
Warrants ("Warrant Series ]") to purchase shares of the Company's Common Stock,
$.0001 par value. Each Series A, B, C, D Warrants are exercisable at $0.25 cents
per Warrant. Each Warrant entitles the holder upon exercise, to receive one
share of common stock underlying each Warrant. Warrants are exercisable at
intervals as follows:
 
 (ii) 1
Series A warrants exercisable at the "Initial Exercise Date" beginning 90 days
following effectiveness of Registration Statement and expiring on the 2nd
anniversary from the effective date.
 
 (iii) 1
Series B warrants exercisable at the "Initial Exercise Date" beginning 120 days
following effectiveness of Registration Statement and expiring on the 2nd
anniversary from the effective date.
 
 (iv) 1
Series C warrants exercisable at the "Initial Exercise Date" beginning 150 days
following effectiveness of Registration Statement and expiring on the 2nd
anniversary from the effective date.
 
 (v) 1
Series D warrants exercisable at the "Initial Exercise Date" beginning 180 days
following effectiveness of Registration Statement and expiring on 2nd
anniversary from the effective date.
  In
February and March 2006, 400,000 units consisting of 400,000 shares of common
stock and four series of common stock purchase warrants were sold for total
consideration of $10,000.
  In May
of  2006, 400,000 shares of common stock and four series of common
stock purchase warrants  were issued for research & development
services rendered.
  Additional
paid in capital has been credited $56,000 and $15,000 in the periods ended March
31, 2008 and 2007  respectively for officer's compensation and
rent.
  No
preferred shares have been issued. It is within the discretion of the Board of
Directors to determine the preferences of the preferred stock. The Company has
not yet determined the preferences of the preferred stock
  
   NOTE
14-SUBSEQUENT EVENTS
  On May
28, 2008   the Registrant sold in a private placement 
transaction an aggregate $24,000 of Series A Units of its securities, at a price
of $.025 per unit.    Each Series A unit consists of One share of
the Company's Common stock, One Series A Warrant, One Series B Warrant, One
Series C Warrant and One Series D Warrant.  Each of the four series of
warrants entitles the holder to purchase one share of the Company's Common Stock
at an exercise price of $0.25 per Share.  The private placement was
exempt from registration under Section 4(2) of the Securities Act of 1933, as
amended, and Rule 506 of Regulation D promulgated there under, inasmuch as the
securities were sold to accredited investors only.    The shares
will bear a 144 Restrictive legend.  The Company has not offered
Registration Rights to the subscriber.
  On May 28, 2008 the Registrant issued 674,000 shares for services rendered
valued at $16,850  in lieu of cash.  The shares issued are restricted
shares and are subject to Rule 144.
   
 F-8
 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, there unto duly
authorized.
  VGTel
      Inc.Registrant
     VGTel,
Inc.,
 
  Ron
      Kallus
                  
                  VGTel,
      Inc.President
      and Principal Executive OfficerDate: 
      June 26, 2008
                  By:
                  /s/ Ron
      KallusTitle: 
      President and Principal Executive
Officer
  Ron
      Kallus
                  
                  VGTel,
      Inc.Principal
      Accounting OfficerDate:  June
      26, 2008
                  By:
                  /s/ Ron
      KallusTitle,
      Principal Accounting Officer
             18