10-Q

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x    QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2012

oTRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                        to                       

Commission file number 333-141690

KABE EXPLORATION INC.

(Name registrant as specified in its charter)

NEVADA	39-2052145
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
5050 Avenida Encinas, Suite 360, Carlsbad, CA	92008
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code:  (760) 931-1048

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 o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer o	Accelerated filer o
Non-accelerated filer o	Smaller reporting company x
(do not check if smaller reporting company)

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

Number of shares of the registrant’s common stock outstanding as of May 14, 2012: 39,203,250 shares of Common Stock

TABLE OF CONTENTS

Part I		3
Item 1.	Financial Statements	3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operation	11
Item 4.	Controls and Procedures	15
Part II		15
Item 1.	Legal Proceedings.	15
Item 6.	Exhibits.	15
	Signatures	16

2

PART I

Item 1.   Financial Statements.

KABE EXPLORATION, INC.

(A Development Stage Company)

Balance Sheet

as at

	March 31,			December 31,
	2012			2011
	(Unaudited)
ASSETS
Current Assets
Cash	$	301		$	349
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current Liabilities
Accounts Payable and accrued liabilities	$	8,202		$	18,288
Chapman Industries Loan (Note 4)	53,757			7,776
Loan Payable - EPS (Note 4)	—			29,856
Total Liabilities	61,959			55,920
Stockholders’ Equity (Deficit)
Common Stock, $0.001 par value; authorized 75,000,000 shares; issued and outstanding: 39,203,250 as at March 31, 2012 and December 31, 2011	39,203			39,203
Additional Paid-In Capital	243,722			243,722
Deficit accumulated during the development stage	(344,583		)	(338,496		)
Total Shareholders’ Equity	(61,658		)	(55,571		)
Total Liabilities and Shareholders’ Equity	$	301		$	349

The accompanying notes are an integral part of these financial statements

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KABE EXPLORATION, INC.

(A Development Stage Company)

Statement of Operations

(Unaudited)

							For the Period
							of Inception
	For the Three Months Ended						from Jan. 1, 2006
	March 31,						through Mar. 31,
	2012			2011			2012
Revenue	$	—		$	—		$	—
Cost of Sales	—			—			—
Operating Income	—			—			—
General and Administrative Expenses:
Mineral Lease Fees	—			—			6,713
Professional Fees	1,925			975			194,464
Consultant Fees							92,700
Other Administrative Expenses	3,077			862			42,851
Loss on abandonment of Mineral Leases							5,000
Total General and Adminstrative Expenses	5,002			1,837			341,728
Other Inocme
Interest Income	—			—			22
Interest Expense	(1,085		)	—			(2,877		)
	(1,085		)	—			(2,855		)
Net Income (Loss)	$	(6,087	)	$	(1,837	)	$	(344,583	)
Income/Loss Per Common Share:
Basic and Diluted	$	(0.00	)	$	(0.00	)
Weighted Average Shares Outstanding
Basic and Diluted:	38,647,250			38,647,250

The accompanying notes are an integral part of these financial statements

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KABE EXPLORATION, INC.

(A Development Stage Company)

Statement of Cash Flows

(Unaudited)

							For the Period
							of Inception
	For The Three Months Ended						from Jan. 1, 2006
	March 31,						through Mar. 31,
	2012			2011			2012
Cash flows from operating activities:
Net loss	$	(6,087	)	$	(1,837	)	$	(344,583	)
Adjustments to reconcile net loss to net cash used by operating activities:
Stock issued for services	—			—			218,925
Change in operating assets and liabilities:
Accounts Payable	(13,559		)	—			4,729
Net cash (used by) operating activities	(19,646		)	(1,837		)	(120,929		)
Cash flows from investing activities
Abandonment of mining leases	—			—			—
Net cash (used by) investing activities	—			—			—
Cash flows from financing activities:
Common stock issued for cash							62,250
Proceeds (repayment) of loans	19,598			1,789			57,230
Contibution of capital	—			—			1,750
Net cash (used) provided by financing activities	19,598			1,789			121,230
Net increase (decrease) in cash	(48		)	(48		)	301
Cash, beginning of the period	349			126			—
Cash, end of the period	$	301		$	78		$	301
Supplemental cash flow disclosure:
Interest paid	$	(1,085	)	$	—		$	(2,877	)
Taxes paid	$	—		$	—		$	—

The accompanying notes are an integral part of these financial statements

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Kabe Exploration, Inc.

(A Development Stage Company)

Notes to Financial Statements

March 31, 2012

(Unaudited)

1.Basis of Presentation and Nature of Operations

The interim financial statements as of and for the three months ended March 31, 2012 reflect all adjustments which, in the opinion of management are necessary to fairly state the Company’s financial position and the results of its operations for the periods presented.

These interim financial statements should be read in conjunction with the Company’s financial statements and notes thereto included in the Company’s December 31, 2011 report on form 10-K. The Company assumes that the users of the interim financial information herein have read, or have access to, the audited financial statements for the preceding period, and that the adequacy of additional disclosure needed for a fair presentation may be determined in that context. The results of operations for the three month period ended March 31, 2012 are not necessarily indicative of results for the entire year ending December 31, 2012.

2.Organization, Nature of Business

Kabe Exploration, Inc. (the “Company”) was incorporated under the laws of the State of Nevada December 16, 2005.  The company chose December 31 as its fiscal year end. The company was originally formed for mineral exploration in the United States.  The Company abandoned its Mineral Leases in 2008.

Current Business of the Company

On May 5, 2010, the Company effected a Share Exchange Agreement with the shareholders of Centiuum Holdings, Inc., a Delaware public company, whereby the Company was to exchange ten Million (10,000,000) newly issued Company shares for all of the outstanding shares of Centiuum Holdings, Inc., 1,000 shares, dependent upon certain investments by Centiuum into the Company.   On October 29, 2010, the Company, with Centiuum Holdings, Inc. and shareholders of Centiuum, entered into an Agreement of Termination and Release with respect to this agreement.

The Company is seeking new business opportunities.

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3.Summary of Significant Accounting Policies

Basis of Presentation

The financial statements of the Company have been prepared using the accrual basis of accounting in accordance with generally accepted accounting principles in the United States.  Because a precise determination of many assets and liabilities is dependent upon future events, the preparation of financial statements for a period necessarily involves the use of estimates which have been made using careful judgment.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, and reported amounts of revenue and expenses during the reporting period.  Actual results could differ materially from those estimates. Significant estimates made by management are, among others, realizability of long-lived assets, deferred taxes and stock option valuation.

Cash and equivalents

Cash and equivalents include investments with initial maturities of three months or less.

Fair Value of Financial Instruments

The Financial Accounting Standards Board issued ASC (Accounting Standards Codification) 820-10 (SFAS No. 157), “Fair Value Measurements and Disclosures” for financial assets and liabilities. FASB ASC 820-10 provides a framework for measuring fair value and requires expanded disclosures regarding fair value measurements.  FASB ASC 820-10 defines fair value as the price that would be received for an asset or the exit price that would be paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date.  FASB ASC 820-10 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs, where available. The carrying amounts of the Company’s financial liabilities as at March 31, 2012 were measured against the three levels of inputs required by the standard to measure fair value:

Chapman Industries Loan $ 53,757 Level 2 based on promissory notes

Income Taxes

The Company utilizes FASB ACS 740, “Income Taxes,” which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns.  Under this method, deferred tax assets and liabilities are determined based on the difference between the tax basis of assets and liabilities and their financial reporting amounts based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income.  A valuation allowance is recorded when it is “more likely-than-not” that a deferred tax asset will not be realized.

The Company generated a deferred tax credit through net operating loss carryforward.  However, a valuation allowance of 100% has been established.  The Company has generated a net operating loss of approximately $344,583, which may be used until 2026 to offset taxable income.

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Interest and penalties on tax deficiencies recognized in accordance with ACS accounting standards are classified as income taxes in accordance with ASC Topic 740-10-50-19.

Going Concern

The Company’s financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business.  The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and to allow it to continue as a going concern.  The Company incurred a net loss of ($6,087) in the three months ended March 31, 2012 and has a cumulative net loss of ($344,583) since inception. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable.  If the Company is unable to obtain adequate capital, it could be forced to cease development of operations.

The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish its plans to exploit or lease mining claims, or engage a working interest partner, in order to eventually secure other sources of financing and attain profitable operations.  The accompanying financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amount and classifications or liabilities or other adjustments that might be necessary should the Company be unable to continue as a going concern.

Development-Stage Company

The Company is considered a development-stage company, with limited operating revenues during the periods presented, as defined by Financial Accounting Standards Board FASB Accounting Standards Codification ASC 915.  ASC 915 requires companies to report their operations, shareholders deficit and cash flows since inception through the date that revenues are generated from management’s intended operations, among other things.  Management has defined inception as January 1, 2006. Since inception, the Company has incurred an operating loss of ($344,583). The Company’s working capital has been generated through the sales of common stock.  Management has provided financial data since January 1, 2006, “Inception” in the financial statements, as a means to provide readers of the Company’s financial information to make informed investment decisions.

Basic and Diluted Net Loss Per Share

Net loss per share is calculated in accordance with FASB ASC 260, Earnings Per Share for the period presented.  Basic net loss per share is based upon the weighted average number of common shares outstanding.  Diluted net loss per share is based on the assumption that all dilative convertible shares and stock options were converted or exercised.  Dilution is computed by applying the treasury stock method.  Under this method, options and warrants are assumed exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby we used to purchase common stock at the average market price during the period.

The Company had no potentially dilutive securities outstanding as of March 31, 2012 and 2011.

The following is a reconciliation of the numerator and denominator of the basic and diluted earnings per share computations for the three months ended March 30, 2012 and 2011:

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	2012			2011
Numerator:
Basic and diluted net loss per share:
Net Loss	$	(6087	)	$	(1837	)
Denominator
Basic and diluted weighted average number of shares outstanding	39,203,250			38,647,210
Basic and Diluted Net Loss Per Share	$	(0.00	)	$	(0.00	)

Recent Accounting Pronouncements

In May 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2011-04, “Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs.” The amendments in this update generally represent clarifications of Topic 820, but also include some instances where a particular principle or requirement for measuring fair value or disclosing information about fair value measurements has changed. This update results in common principles and requirements for measuring fair value and for disclosing information about fair value measurements in accordance with U.S. GAAP and IFRS. The amendments in this update are to be applied prospectively. The amendments are effective for interim and annual periods beginning after December 15, 2011. Early application is not permitted. The Company does not expect this guidance to have a significant impact on its consolidated financial position, results of operations or cash flows.

In June 2011, the FASB issued ASU No. 2011-05, “Presentation of Comprehensive Income.” This update was amended in December 2011 by ASU No. 2011-12, “Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in Accounting Standards Update No. 2011-05.” This update defers only those changes in update 2011-05 that relate to the presentation of reclassification adjustments. All other requirements in update 2011-05 are not affected by this update, including the requirement to report comprehensive income either in a single continuous financial statement or in two separate but consecutive financial statements. ASU No. 2011-05 and 2011-12 are effective for fiscal years (including interim periods) beginning after December 15, 2011. The Company does not expect this guidance to have a significant impact on its consolidated financial position, results of operations or cash flows.

In December 2011, the FASB issued ASU No. 2011-11, “Disclosures about Offsetting Assets and Liabilities.” The amendments in this update require enhanced disclosures around financial instruments and derivative instruments that are either (1) offset in accordance with either ASC 210-20-45 or ASC 815-10-45 or (2) subject to an enforceable master netting arrangement or similar agreement, irrespective of whether they are offset in accordance with either ASC 210-20-45 or ASC 815-10-45. An entity should provide the disclosures required by those amendments retrospectively for all comparative periods presented. The amendments are effective during interim and annual periods beginning on or after January 1, 2013. The Company does not expect

9

this guidance to have any impact on its consolidated financial position, results of operations or cash flows.

The Company has reviewed issued accounting pronouncements and plans to adopt those that are applicable to it.  The Company does not expect the adoption of any other pronouncements to have a n impact on its results of operations or financial position.

4.Loans Payable

Chapman Industries Loan

	March 31,
	2011		2011
Loan	$	53,757	$	0
Accrued Interest	$	3,473	$	0

In January, 2012 Chapman Industries absorbed into its loan the loan of EPS Inc.  Chapman Industries also assumed the accounts payable of the Company on the same date. The loan interest was raised to 8% from 6% in January 2012.  The loan is payable on demand, has no terms of repayment and has no maturity date. Chapman Industries is an entity controlled by the President of the Company and is considered a related party.

Loan Payable — EPS Inc.

	March 31,
	2012		2011
Loan	$	0	$	11,197
Accrued Interest	$	0	0

In January, 2012 Chapman Industries absorbed into its loan the loan of EPS Inc.  The loan carried interest at 6%,was payable on demand, had no terms of repayment and had no maturity date.  EPS Inc. is an entity controlled by the President of the Company and is considered a related party.

5.Capital Structure

As of March 30, 2012 the Company has authorized 75,000,000 of $ 0.001 par common stock, of which 39,203,250 shares were issued and outstanding.

6.Contingencies, Litigation

There were no loss contingencies or legal proceedings against the Company with respect to matters arising in the ordinary course of business. Neither the Company nor any of its officers or directors is involved in any other litigation either as plaintiffs or defendants, and have no knowledge of any threatened or pending litigation against them or any of the officers or directors.

7.Subsequent Events

Events subsequent to March 31, 2012 have been evaluated through May 17, 2011, the date these statements were available to be issued, to determine whether they should be disclosed to keep the financial statements from being misleading.

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

Except as otherwise required by the context, all references in this prospectus to “we”, “us”, “our”, or “Company” refer to the operations of Kabe Exploration Inc., a Nevada corporation.

Forward-Looking Statements and Associated Risks

The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for certain forward-looking statements. Some of the statements contained in this annual report of the Company discuss future expectations, contain projections of our operations or financial condition or state other forward-looking information. Some statements contained in this annual report on Form 10-Q that are not historical facts (including without limitation statements to the effect that we “believe,” “expect,” “anticipate,” “plan,” “intend,” “foresee,” or other similar expressions) and are forward-looking statements. These forward-looking statements are based on our current expectations and beliefs concerning future developments and their potential effects on us. There can be no assurance that future developments affecting us will be those anticipated by us. All comments concerning our expectations for future revenue and operating results are based on our forecasts of our plan of operation and do not include the potential impact of any future acquisitions or operations. These forward-looking statements involve significant risks and uncertainties (some of which are beyond our control) and assumptions. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in the forward-looking statements.

Overview

We are a “shell company” defined in Rule 405 under the Securities Act of 1933 and Rule 12b-2 under the Securities Exchange Act of 1934, since we have only conducted nominal operations and have only nominal assets.

During 2007, we were an exploration stage company engaged in the acquisition and exploration of mineral properties. We entered into a lease agreement with George J. Eliopulos effective March 31, 2006, granting us the exclusive right to explore, develop, and mine the property for gold, silver, copper and other valuable minerals.  The property consisted of one unpatented mining claim located in section 12, Township 16 North, Range 20 East, Mt. Diablo Baseline & Meridian, Storey County, Nevada, USA, owned by Mr. Eliopulos.

On December 18, 2007, Erik Ulsteen entered into an agreement with Antony Claydon, our former President and a director and Rory Moss, a director, to purchase 1,500,000 and 250,000 shares of common stock, respectively, for an aggregate purchase price of $50,000. The transaction closed on February 14, 2008 at which time, Mr. Claydon resigned as President, Chief Financial Officer and Secretary and Mr. Ulsteen was appointed President, Chief Financial Officer, Secretary and director.  On January 28, 2008, we terminated our lease agreement with Mr. Eliopulos.

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On May 5, 2010, we entered into a Share Exchange Agreement with Centiuum Holdings Inc. and its stockholders whereby Centiuum’s stockholders will exchange all of their shares of common stock of Centiuum for 10,000,000 newly issued shares of our common stock.  In addition, our principal stockholder, Erik Ulsteen has agreed to deposit 10,000,000 shares of our common stock owned by him (the “Escrow Shares”) into escrow upon closing of the exchange.  At any time within 120 days after closing of the exchange, the Escrow Shares will be released to Centiuum upon a cash investment of a minimum of $500,000 invested in Kabe or Kabe enters into executed contracts aggregating a minimum of $500,000 in cash flow to Kabe.  The closing of the transactions are subject to customary closing conditions including due diligence.  Centiuum Holdings is a provider of consulting services, environmental engineering, clean development mechanism and project management services worldwide.  On October 29, 2010, we entered into an Agreement of Termination and Release with Centiuum and the shareholders of Centiuum with respect to the Share Exchange Agreement dated as of May 5, 2010

The following factors raise substantial doubt regarding the ability of our business to continue as a going concern: (i) the losses we have incurred since our inception; (ii) our failure to generate revenues since our inception; and (iii) our dependence on the sale of our equity securities and on the receipt of capital from outside sources to continue our operations. Our auditors have issued a going concern opinion regarding our business. The financial statements do not include any adjustments that might result from the uncertainty about our ability to continue in business. As such we may have to cease operations and you could lose your investment.

Plan of Operation

We have redirected our focus towards identifying and pursuing options regarding the development of a new business plan and direction. We are exploring various business opportunities that have the potential to generate positive revenue, profits and cash flow in order to financially accommodate the costs of being a publicly held company.

Results of Operations

Three Months Ended March 31, 2012 Compared to Three Months Ended March 31, 2011

Revenues

We have generated no operating revenues from operations from our inception.

Costs and Expenses

From our inception through March 31, 2012, we have incurred cumulative losses of $344,583.  Professional fees increased to $1,925 for the three months ended March 31, 2012 from $975 for the three months ended March 31, 2011.  Other Administrative expenses increased to $3,077 for the three months ended March 31, 2012 from $862 for the three months ended March 31, 2011.

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Liquidity and Capital Resources

As of March 31, 2012, we had a working capital deficit of $61,658 as compared to a working capital deficit of $55,571 as of December 31, 2011.  Our cash position was $301 as of March 31, 2012 compared to $349 as of December 31, 2011.  We have financed our company principally through the private placement of our common stock.  As of March 31, 2012, we have no long term debt.

Summary of Significant Accounting Policies

Basis of Presentation

Our financial statements have been prepared using the accrual basis of accounting in accordance with generally accepted accounting principles in the United States.  Because a precise determination of many assets and liabilities is dependent upon future events, the preparation of financial statements for a period necessarily involves the use of estimates which have been made using careful judgment.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, and reported amounts of revenue and expenses during the reporting period.  Actual results could differ materially from those estimates. Significant estimates made by management are, among others, realizability of long-lived assets, deferred taxes and stock option valuation.

The financial statements have, in management’s opinion, been properly prepared within the reasonable limits of materiality and within the framework of the significant accounting.

Income Taxes

We utilize SFAS No. 109, “Accounting for Income Taxes,” which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns.  Under this method, deferred tax assets and liabilities are determined based on the difference between the tax basis of assets and liabilities and their financial reporting amounts based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income.  Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. We generated a deferred tax credit through net operating loss carryforward.  However, a valuation allowance of 100% has been established, as the realization of the deferred tax credits is not reasonably certain, based on going concern considerations outlined as follows.

13

Going Concern

Our financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business.  We have not yet established an ongoing source of revenues sufficient to cover our operating costs and to allow us to continue as a going concern.  Our ability to continue as a going concern is dependent on us obtaining adequate capital to fund operating losses until we become profitable.  If we are unable to obtain adequate capital, we could be forced to cease operations.

Our ability to continue as a going concern is dependent upon our ability to successfully accomplish our plan to develop a new business plan, or merger candidate in order to eventually secure other sources of financing and attain profitable operations.  The accompanying financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amount and classifications or liabilities or other adjustments that might be necessary should we be unable to continue as a going concern.

Development-Stage Company

We are considered a development-stage company, with limited operating revenues during the periods presented, as defined by Statement of Financial Accounting Standards (“SFAS”) No. 7.  SFAS.  No. 7 requires companies to report their operations, shareholders deficit and cash flows since inception through the date that revenues are generated from management’s intended operations, among other things.  Management has defined inception as January 1, 2006. Since inception until March 31, 2012, we have incurred an operating loss of $344,583.  Our working capital has been generated through sales of common stock.  Management has provided financial data since January 1, 2006, “Inception” in the financial statements, as a means to provide readers of our financial information to make informed investment decisions.

Basic and Diluted Net Loss Per Share

Net loss per share is calculated in accordance with SFAS 128, Earnings Per Share for the period presented.  Basic net loss per share is based upon the weighted average number of common shares outstanding.  Diluted net loss per share is based on the assumption that all dilative convertible shares and stock options were converted or exercised.  Dilution is computed by applying the treasury stock method.  Under this method, options and warrants are assumed exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby we used to purchase common stock at the average market price during the period.

We had no potentially dilutive securities outstanding as of March 31, 2012.

Off-Balance Sheet Arrangements

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to our stockholders.

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Item 4    Controls and Procedures.

Evaluation of Disclosure Controls and Procedures. Under the supervision and with the participation of our management, including our President, Chief Financial Officer and Secretary, we evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”)) as of the end of the period covered by this report.  Based upon that evaluation, our President, Chief Financial Officer and Secretary concluded that our disclosure controls and procedures as of the end of the period covered by this report were effective such that the information required to be disclosed by us in reports filed under the Securities Exchange Act of 1934 is (i)  recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii)  accumulated and communicated to our management to allow timely decisions regarding disclosure.  A controls system cannot provide absolute assurance, however, that the objectives of the controls system are met, and no evaluation of controls can provide absolute ssurance that all control issues and instances of fraud, if any, within a company have been detected.

Changes in Internal Control Over Financial Reporting.  During the most recent quarter ended March 31, 2012, there has been no change in our internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act) ) that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II

Item 1.       Legal Proceedings.

We are not a party to any pending legal proceeding, nor is our property the subject of a pending legal proceeding, that is not in the ordinary course of business or otherwise material to the financial condition of our business.

Item 6.       Exhibits.

Exhibit No.	Title of Document
31.1	Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934
32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101	Financial statements from the quarterly report on Form 10-Q of the Company for the quarter ended March 31,2012, filed on May 18, 2012, formatted in Extensible Business Reporting Language (XBRL): (i) the Statements of Operations, (ii) the Balance Sheets, (iii) the Statements of Cash Flows (iv) the Statement of Shareholders’ Equity and (v) the Notes to Financial Statements tagged as blocks of text.

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SIGNATURES

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

KABE EXPLORATION, INC.
By:	/s/ Erik Ulsteen
	Erik Ulsteen
	President, Chief Financial Officer,
	Secretary
Date:	May 18, 2012

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EX-31.1

Exhibit 31.1

CERTIFICATION OF PRESIDENT AND CHIEF FINANCIAL OFFICER PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Erik Ulsteen, certify that:

1	I have reviewed this Form 10-Q of Kabe Exploration, Inc.;
2	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the small business issuer as of, and for, the periods present in this report;
4	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13-a-15(f) and 15d-15(f)) for the registrant and have:
	A	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	B	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principals;
	C	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	D	Disclosed in this report any change in the registrant’s internal control over financing reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5	The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
	A	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
	B	Any fraud, whether or not material, that involved management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 18, 2012

/s/ Erik Ulsteen

Erik Ulsteen

President, Chief Financial Officer and Secretary

EX-32.1

Exhibit 32.1

CERTIFICATION OF PRESIDENT AND CHIEF FINANCIAL OFFICER PURSUANT TO 18 U.S.C. SECTION 1350

In connection with this Quarterly Report of Kabe Exploration, Inc. (the “Company”) on Form 10-Q for the three months ending March 31, 2012, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Erik Ulsteen, President, Chief Financial Officer and Secretary of the Company, certifies to the best of my knowledge, pursuant to 18 U.S.C. Sec. 1350, as adopted pursuant to Sec. 906 of the Sarbanes-Oxley Act of 2002, that:

1	Such Quarterly Report on Form 10-Q for the three months ending March 31, 2012, fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2	The information contained in such Quarterly Report on Form 10-Q for the three months ending March 31, 2012, fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: May 18, 2012

/s/ Erik Ulsteen

Erik Ulsteen

President

Chief Financial Officer

Secretary

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Commitment and Contingencies

3 Months Ended

Mar. 31, 2012

Commitment and Contingencies

Commitments and Contingencies Disclosure [Text Block]

6. Contingencies, Litigation

There were no loss contingencies or legal proceedings against the Company with respect to matters arising in the ordinary course of business. Neither the Company nor any of its officers or directors is involved in any other litigation either as plaintiffs or defendants, and have no knowledge of any threatened or pending litigation against them or any of the officers or directors.

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Equity

3 Months Ended

Mar. 31, 2012

Equity

Stockholders' Equity Note Disclosure [Text Block]

5.    Capital Structure

As of March 30, 2012 the Company has authorized 75,000,000 of $ 0.001 par common stock, of which 39,203,250 shares were issued and outstanding.

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Statement of Financial Position, Classified (USD $)	Mar. 31, 2012	Dec. 31, 2011
Assets, Current
Cash and Cash Equivalents, at Carrying Value	$ 301	$ 349
Assets, Current	301	349
Assets	301	349
Liabilities, Current
Accrued Liabilities, Current	8,202	18,288
Notes Payable, Current	53,757	7,776
Loans Payable, Current		29,856
Liabilities, Current	61,959	55,920
Liabilities	61,959	55,920
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest
Common Stock, Value, Issued	39,203	39,203
Additional Paid in Capital, Common Stock	243,722	243,722
Retained Earnings (Accumulated Deficit)	(344,583)	(338,496)
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	(61,658)	(55,571)
Liabilities and Equity	$ 301	$ 349

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Organization, Consolidation and Presentation of Financial Statements

3 Months Ended

Mar. 31, 2012

Organization, Consolidation and Presentation of Financial Statements

Organization, Consolidation and Presentation of Financial Statements Disclosure and Significant Accounting Policies [Text Block]

  Kabe Exploration, Inc.

(A Development Stage Company)

Notes to Financial Statements

March 31, 2012

(Unaudited)

1.Basis of Presentation and Nature of Operations

The interim financial statements as of and for the three months ended March 31, 2012 reflect all adjustments which, in the opinion of management are necessary to fairly state the Company’s financial position and the results of its operations for the periods presented.

These interim financial statements should be read in conjunction with the Company’s financial statements and notes thereto included in the Company’s December 31, 2011 report on form 10-K. The Company assumes that the users of the interim financial information herein have read, or have access to, the audited financial statements for the preceding period, and that the adequacy of additional disclosure needed for a fair presentation may be determined in that context. The results of operations for the three month period ended March 31, 2012 are not necessarily indicative of results for the entire year ending December 31, 2012.

2.    Organization, Nature of Business

Kabe Exploration, Inc. (the “Company”) was incorporated under the laws of the State of Nevada December 16, 2005.  The company chose December 31 as its fiscal year end. The company was originally formed for mineral exploration in the United States.  The Company abandoned its Mineral Leases in 2008.

Current Business of the Company

On May 5, 2010 The Company effected a Share Exchange Agreement with the shareholders of Centiuum Holdings, Inc., a Delaware public company, whereby the Company was to exchange ten Million (10,000,000) newly issued Company shares for all of the outstanding shares of Centiuum Holdings, Inc., 1,000 shares, dependent upon certain investments by Centiuum into the Company.   On October 29, 2010, the Company, with Centiuum Holdings, Inc. and shareholders of Centiuum, entered into an Agreement of Termination and Release with respect to this agreement.

The Company is seeking new business opportunities.

3.    Summary of Significant Accounting Policies

Basis of Presentation

The financial statements of the Company have been prepared using the accrual basis of accounting in accordance with generally accepted accounting principles in the United States.  Because a precise determination of many assets and liabilities is dependent upon future events, the preparation of financial statements for a period necessarily involves the use of estimates which have been made using careful judgment.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, and reported amounts of revenue and expenses during the reporting period.  Actual results could differ materially from those estimates. Significant estimates made by management are, among others, realizability of long-lived assets, deferred taxes and stock option valuation.

Cash and equivalents

Cash and equivalents include investments with initial maturities of three months or less.

Fair Value of Financial Instruments



The Financial Accounting Standards Board issued   ASC (Accounting Standards Codification) 820-10 (SFAS No. 157), “Fair Value Measurements and Disclosures" for financial assets and liabilities. FASB ASC 820-10 provides a framework for measuring fair value and requires expanded disclosures regarding fair value measurements.  FASB ASC 820-10 defines fair value as the price that would be received for an asset or the exit price that would be paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date.  FASB ASC 820-10 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs, where available. The carrying amounts of the Company’s financial liabilities as at March 31, 2012 were measured against the three levels of inputs required by the standard to measure fair value:

     Chapman Industries Loan        $   53,757        Level 2 based on promissory notes

Income Taxes

The Company utilizes FASB ACS 740, “Income Taxes,” which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns.  Under this method, deferred tax assets and liabilities are determined based on the difference between the tax basis of assets and liabilities and their financial reporting amounts based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income.  A valuation allowance is recorded when it is “more likely-than-not” that a deferred tax asset will not be realized.

The Company generated a deferred tax credit through net operating loss carryforward.  However, a valuation allowance of 100% has been established.  The Company has generated a net operating loss of approximately $344,583, which may be used until 2026 to offset taxable income.

Interest and penalties on tax deficiencies recognized in accordance with ACS accounting standards are classified as income taxes in accordance with ASC Topic 740-10-50-19.

Going Concern

The Company’s financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business.  The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and to allow it to continue as a going concern.  The Company incurred a net loss of ($6,087) in the three months ended March 31, 2012 and has a cumulative net loss of ($344,583) since inception. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable.  If the Company is unable to obtain adequate capital, it could be forced to cease development of operations.

The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish its plans to exploit or lease mining claims, or engage a working interest partner, in order to  eventually secure other sources of financing and attain profitable operations.  The accompanying financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amount and classifications or liabilities or other adjustments that might be necessary should the Company be unable to continue as a going concern.

Development-Stage Company

The Company is considered a development-stage company, with limited operating revenues during the periods presented, as defined by Financial Accounting Standards Board FASB Accounting Standards Codification ASC 915.  ASC 915 requires companies to report their operations, shareholders deficit and cash flows since inception through the date that revenues are generated from management’s intended operations, among other things.  Management has defined inception as January 1, 2006. Since inception, the Company has incurred an operating loss of ($344,583). The Company’s working capital has been generated through the sales of common stock.  Management has provided financial data since January 1, 2006, “Inception” in the financial statements, as a means to provide readers of the Company’s financial information to make informed investment decisions.

Basic and Diluted Net Loss Per Share

Net loss per share is calculated in accordance with FASB ASC 260, Earnings Per Share for the period presented.  Basic net loss per share is based upon the weighted average number of common shares outstanding.  Diluted net loss per share is based on the assumption that all dilative convertible shares and stock options were converted or exercised.  Dilution is computed by applying the treasury stock method.  Under this method, options and warrants are assumed exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby we used to purchase common stock at the average market price during the period.

The Company had no potentially dilutive securities outstanding as of March 31, 2012 and 2011.

The following is a reconciliation of the numerator and denominator of the basic and diluted earnings per share computations for the three months ended March 30, 2012 and 2011:

                                                                                    2012                        2011       

Numerator:

            Basic and diluted net loss per share:

Net Loss                                                              $ (6087)                   $ (1837)

            Denominator

            Basic and diluted weighted average

              number of shares outstanding                                       39,203,250              38,647,210

Basic and Diluted Net Loss Per Share                      $  (0.00)              $  (0.00)

Recent Accounting Pronouncements

In May 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2011-04, "Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs." The amendments in this update generally represent clarifications of Topic 820, but also include some instances where a particular principle or requirement for measuring fair value or disclosing information about fair value measurements has changed. This update results in common principles and requirements for measuring fair value and for disclosing information about fair value measurements in accordance with U.S. GAAP and IFRS. The amendments in this update are to be applied prospectively. The amendments are effective for interim and annual periods beginning after December 15, 2011. Early application is not permitted. The Company does not expect this guidance to have a significant impact on its consolidated financial position, results of operations or cash flows.

In June 2011, the FASB issued ASU No. 2011-05, "Presentation of Comprehensive Income." This update was amended in December 2011 by ASU No. 2011-12, "Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in Accounting Standards Update No. 2011-05." This update defers only those changes in update 2011-05 that relate to the presentation of reclassification adjustments. All other requirements in update 2011-05 are not affected by this update, including the requirement to report comprehensive income either in a single continuous financial statement or in two separate but consecutive financial statements. ASU No. 2011-05 and 2011-12 are effective for fiscal years (including interim periods) beginning after December 15, 2011. The Company does not expect this guidance to have a significant impact on its consolidated financial position, results of operations or cash flows.

In December 2011, the FASB issued ASU No. 2011-11, "Disclosures about Offsetting Assets and Liabilities." The amendments in this update require enhanced disclosures around financial instruments and derivative instruments that are either (1) offset in accordance with either ASC 210-20-45 or ASC 815-10-45 or (2) subject to an enforceable master netting arrangement or similar agreement, irrespective of whether they are offset in accordance with either ASC 210-20-45 or ASC 815-10-45. An entity should provide the disclosures required by those amendments retrospectively for all comparative periods presented. The amendments are effective during interim and annual periods beginning on or after January 1, 2013. The Company does not expect this guidance to have any impact on its consolidated financial position, results of operations or cash flows.

The Company has reviewed issued accounting pronouncements and plans to adopt those that are applicable to it.  The Company does not expect the adoption of any other pronouncements to have a n impact on its results of operations or financial position.

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Debt

3 Months Ended

Mar. 31, 2012

Debt

Debt Disclosure [Text Block]

4.    Loans Payable

            Chapman Industries Loan

                                                                                                  March 31,

                                                                                       2011                            2011

                                                Loan                            $53,757                                   $        0          

                                                Accrued Interest          $  3,473                                   $        0

In January, 2012 Chapman Industries absorbed into its loan the loan of EPS Inc.    Chapman Industries also assumed the accounts payable of the Company on the same date. The loan interest was raised to 8% from 6% in January 2012.  The loan is payable on demand, has no terms of repayment and has no maturity date. Chapman Industries is an entity controlled by the President of the Company and is considered a related party. 

Loan Payable – EPS Inc.

                                                                                                March 31,

                                                                                       2012                            2011

                                                Loan                            $         0                                   $11,197

                                                Accrued Interest          $        0                                             0  

In January, 2012 Chapman Industries absorbed into its loan the loan of EPS Inc.  The loan carried interest at 6%,was payable on demand, had no terms of repayment and had no maturity date.  EPS Inc. is an entity controlled by the President of the Company and is considered a related party. 

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Statement of Financial Position - Parenthetical (USD $)	Mar. 31, 2012	Dec. 31, 2011
Common Stock, Par Value	$ 0.001	$ 0.001
Common Stock, Shares Authorized	75,000,000	75,000,000
Common Stock, Shares Issued	39,203,250	39,203,250
Common Stock, Shares Outstanding	39,203,250	39,203,250

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Document and Entity Information (USD $)	3 Months Ended
	Mar. 31, 2012	May 17, 2012
Document and Entity Information
Entity Registrant Name	Kabe Exploration Inc.
Document Type	10-Q
Document Period End Date	Mar. 31, 2012
Amendment Flag	false
Entity Central Index Key	0001394446
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		39,203,250
Entity Public Float		$ 2,125,598
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q1

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Condensed Statement of Operations (USD $)	3 Months Ended		75 Months Ended
	Mar. 31, 2012	Mar. 31, 2011	Mar. 31, 2012
Mineral lease fees			$ 6,713
Professional fees	1,925	975	194,464
Consulting			92,700
Other administrative expense	3,077	862	42,851
Loss on abandonment of mineral lease			5,000
Total General and Administrative Expense	5,002	1,837	341,728
Net Profit / (Loss) From Operations	(5,002)	(1,837)	(341,728)
Other Income / (Expenses)			22
Interest Expense	1,085		2,877
Net Profit / (Loss) Before Income Taxes	(6,087)	(1,837)	(344,583)
Income Tax Expense	0	0	0
Net Income	$ (6,087)	$ (1,837)	$ (344,583)
Earnings Per Share, Basic	$ (0.0002)	$ 0.0000
Earnings Per Share, Diluted	$ (0.0002)	$ 0.0000
Weighted average number of shares outstanding, basic	39,203,250	39,203,250
Weighted average number of shares outstanding, diluted	39,203,250	39,203,250

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Condensed Statements of Cash Flows (USD $)	3 Months Ended		75 Months Ended
	Mar. 31, 2012	Mar. 31, 2011	Mar. 31, 2012
Net Income	$ (6,087)	$ (1,837)	$ (344,583)
Issuance of Stock and Warrants for Services or Claims			218,925
Increase (Decrease) in Accounts Payable	(13,559)		4,729
Net Cash Provided by used in Operating Activities	(19,646)	(1,837)	(120,929)
Proceeds from Issuance of Common Stock			62,250
Proceeds from (Repayments of) Notes Payable	19,598	1,789	57,230
Proceeds from Contributed Capital			1,750
Cash and Cash Equivalents, Period Increase (Decrease)	(48)	(48)	301
Cash and Cash Equivalents, at Carrying Value	349	126	0
Cash and Cash Equivalents, at Carrying Value	$ 301	$ 78	$ 301

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Subsequent Events

3 Months Ended

Mar. 31, 2012

Subsequent Events

Subsequent Events [Text Block]

6.Subsequent Events

Events subsequent to March 31, 2012 have been evaluated through May 17, 2011, the date these statements were available to be issued, to determine whether they should be disclosed to keep the financial statements from being misleading.