SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarter ended October 31, 2005
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________ to __________
Commission file number: 0-011013
COMSTOCK INDUSTRIES, INC.
--------------------------------
(Exact name of registrant as specified in its charter)
Florida 65-1030375
(State or Other Jurisdiction (IRS Employer Identification
of Incorporation) Number)
5100 Town Center Circle, Suite 430, Boca Raton, Florida 33486
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(Address of Principal Executive Offices, Including Zip Code)
(561) 361-9326
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(Registrant's Telephone Number, Including Area Code)
N/A
(Former Name or Former Address, if Changed Since Last Report)
APPLICABLE TO ISSUERS INVOLVED IN
BANKRUPTCY PROCEEDINGS DURING THE
PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports
required to be filed by Section 12, 13 or 15(d) of the Securities
Exchange Act after distribution of securities under a plan confirmed
by a court:
YES [ ] NO [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practical date: As of
May 1, 2006, there were 8,185,885 shares of issuer's $.0001 par
value common stock outstanding.
Transitional Small Business Disclosure Format (check one):
YES [ ] NO [X]
TABLE OF CONTENTS
Part I - FINANCIAL INFORMATION
Item 1. Financial Statements.
(a) Balance Sheets as of October 31, 2005 and April 30, 2005
(b) Statements of Operations for the three and six month
periods ended October 31, 2005 and October 31, 2004 and the period from reactivation [May 1, 2001] through October 31, 2005
(c) Statements of Cash Flows for the six month
periods ended October 31, 2005 and October 31, 2004 and the period from reactivation [May 1, 2001] through October 31, 2005
(d) Notes to Financial Statements
Item 2. Management's Discussion and Analysis or Plan
of Operation.
Item 3. Controls and Procedures.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
Item 2. Changes in Securities and Use of Proceeds.
Item 3. Defaults on Senior Securities.
Item 4. Submission of Matters to a Vote of Security
Item 5. Other Information.
Item 6. Exhibits and Reports on Form 8-K.
SIGNATURES
PART I - FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS.
COMSTOCK INDUSTRIES, INC.
Condensed Financial Statements
October 31, 2005
Comstock Industries, Inc.
Condensed Balance Sheet
October 31, 2005
(Unaudited)
![[comstockindustries10qsb31002.gif]](https://capedge.com/proxy/10QSB/0000717410-06-000005/comstockindustries10qsb31002.gif)
See accompanying notes to the financial statements
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Comstock Industries, Inc.
Condensed Statements of Operations
For The Three and Six Month Periods Ended October 31, 2005 and 2004 and for the Period from Reactivation [May 1, 2001] through October 31, 2005
(Unaudited)
![[comstockindustries10qsb31004.gif]](https://capedge.com/proxy/10QSB/0000717410-06-000005/comstockindustries10qsb31004.gif)
See accompanying notes to the financial statements
2
Comstock Industries, Inc.
Statements of Cash Flows
For The Six Months Ended October 31, 2005 and 2004 and for the Period from Reactivation [May 1, 2001] through October 31, 2005
(Unaudited)
![[comstockindustries10qsb31006.gif]](https://capedge.com/proxy/10QSB/0000717410-06-000005/comstockindustries10qsb31006.gif)
See accompanying notes to the financial statements
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Comstock Industries, Inc.
Notes to Condensed Financial Statements
October 31, 2005
NOTE 1 – BASIS OF PRESENTATION
The accompanying financial statements have been prepared without audit, pursuant to the rules and regulations of the Security and Exchange Commission. The interim financial statements reflect all adjustments which, in the opinion of management, are necessary to present a fair statement of the results for the period and all adjustments are of a normal recurring nature.
Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report for the year ended April 30, 2005. The results of operation for period ended October 31, 2005 are not necessarily indicative of the operating results for the year.
NOTE 2 – LIQUIDITY / GOING-CONCERN
The Company has accumulated losses from inception through October 31, 2005 amounting to $350,173 and has no assets or operations at October 31, 2005. These factors raise substantial doubt about the Company’s ability to continue as a going concern.
Management plans include raising capital to expand business operations, or seeking a well capitalized merger candidate. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
NOTE 3 – CONTINGENCY
On June 22, 2005 the Company reached a settlement agreement with Edward H. Gilbert. Both parties agreed to avoid the institution of litigation in connection with the outstanding balance of $142,623.64 owed to Mr. Gilbert. The Company agreed to remit $25,000 of the settlement funds no later than fifteen days after the Company receives proceeds from a reorganization financing expected to be completed by June 30, 2006. The Company also agreed to remit $25,000 of the settlement funds no later than fifteen days after Comstock received proceeds from a secondary financing agreement expected to be completed by the Company by December 31, 2006. The Company also agreed to issue 50,000 shares of its common stock to Mr. Gilbert no later than five days after the effective date of June 22, 2005. A Shareholder issued their personal shares on behalf of the Company to complete this agreement. The Company has recorded forgiveness of debt of $92,625.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
The following discussion of our financial condition and results
of operations should be read in conjunction with the financial
statements and the notes to the financial statements included
elsewhere in this report. The discussion may contain "forward
looking" statements or statements which arguably imply or suggest
certain things about our future. Statements, which express that we
"believe", "anticipate", "expect", or "plan to", as well as, other
statements which are not historical fact, are forward looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. These statements are based on assumptions that
we believe are reasonable, but a number of factors could cause our
actual results to differ materially from those expressed or implied
by these statements. We do not intend to update these forward
looking statements.
Overview
We are the successor by the Merger to Comstock Nevada. On July
10, 2000, Comstock Nevada changed its state of incorporation from
Nevada to Florida by means of a merger into a wholly-owned Florida
subsidiary, Comstock Industries Florida, Inc., which as a part of
the Merger changed its name to Comstock Industries, Inc.
Plan of Operations
Prior to the Merger, we were a development stage company
seeking to engage in the mining business. Our efforts to engage in
the mining business proved unsuccessful and over at least the last
three years we have not engaged in any meaningful business
operations. We continue to be considered as a development stage
company, and we have focused our business activities on seeking suitable merger or acquisition candidates. Accordingly, during the six month period ended October 31, 2005, we did not generate any revenues and had expenses of $4,504.
We expect to be required to raise a limited amount of
additional funds during the next 12 months to meet our cash
requirements, and we believe that before we will be able to commence
any business operations or engage in any merger or acquisition, we
may have to raise capital to fund such operations or merger or
acquisition transaction. The capital requirements might be
substantial, but we are unable to estimate any such capital
requirements at this time. We are uncertain that we will be able to
raise any capital in the future or if such capital is raised that it
will be on terms favorable to us. To the extent that we have
current working capital requirements, we believe that we may be able
to obtain very limited amounts of capital from our existing
stockholders in the form of loans or capital contributions.
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We have not undertaken any product research and development
during the six month period ended October 31, 2005.
We do not expect to purchase or sell any plant or significant
equipment.
We do not expect any significant changes in our number of
employees.
Item 3. Controls and Procedures.
a. Our principal executive officer and our principal financial
officer, who was on the Evaluation Date (as hereinafter
defined) and is on the date of the filing of this quarterly
report the same person, has on a date which is within ninety
days of the date that we have filed this quarterly report (the
"Evaluation Date"), evaluated the effectiveness of our
disclosure controls and procedures and has concluded that no
significant deficiencies or material weaknesses exist.
b. There have been no significant changes in our internal controls
or in any other factors that could significantly affect these
controls subsequent to the Evaluation Date.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS. Not Applicable.
ITEM 2. CHANGES IN SECURITIES. Not Applicable.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES. Not Applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Not Applicable
ITEM 5. OTHER EVENTS. Not Applicable
ITEM 6. EXHIBITS, LISTS AND REPORTS ON FORM 8-K:
(a) Exhibits.
The following is a list of exhibits filed as part of this
quarterly report on Form 10-QSB. Where so indicated by footnote,
exhibits which were previously filed are incorporated by reference.
For exhibits incorporated by reference, the location of the exhibit
in the previous filing is indicated in parentheses.
DESCRIPTION
EXHIBIT
NO.
2.1 Merger Agreement (2)
3.1 Articles of Incorporation of Comstock Nevada. (1)
3.2 Bylaws of Comstock Nevada.(1)
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3.3 Articles of Incorporation of Comstock Florida. (2)
3.4 Bylaws of Comstock Florida (2)
31.1* Certificate of the Chief Executive Officer pursuant
to Section 302 of the Sarbanes-Oxley Act of 2002
31.2* Certificate of the Chief Financial Officer pursuant
to Section 302 of the Sarbanes-Oxley Act of 2002
32.1* Certificate of the Chief Executive Officer pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002
32.2* Certificate of the Chief Financial Officer pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002
(1) Previously filed with Form 10 of the Company dated March 5, 1983
and incorporated herein by reference.
(2) Previously filed with Form 10QSB of the Company for the quarter
ended July 31, 2000 and filed on August 15, 2000.
* Filed Herein.
(b) Reports on Form 8-K. None.
SIGNATURES
In accordance with the requirements of the Exchange Act, the
registrant has caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
COMSTOCK INDUSTRIES, INC.
Date: May 1, 2006 By: /s/ Atul Sharma
Atul Sharma, President
Date: May 1, 2006 By: /s/ Atul Sharma
Atul Sharma, Principal Financial
Officer
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EXHIBIT 31.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Atul Sharma, certify that:
1. I have reviewed this Quarterly Report on Form 10-QSB of COMSTOCK INDUSTRIES, 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 presented in
this report;
4. I am the small business issuer's sole officer and director and am
responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))
for the small business issuer and have:
a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under my
supervision, to ensure that material information relating to the
small business issuer, including its consolidated subsidiaries,
is made known to me by others within those entities, particularly
during the period in which this report is being prepared;
b) Paragraph omitted in accordance with SEC transition instructions
contained in SEC Release No. 33-8238, and an extension of the
compliance date in accordance with SEC Release No. 33-8545;
c) Evaluated the effectiveness of the small business issuer's
disclosure controls and procedures and presented in this report
my 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 small business
issuer's internal control over financial reporting that occurred
during the small business issuer's most recent fiscal quarter
that has materially affected, or is reasonably likely to
materially affect, the small business issuer's internal control
over financial reporting; and
5. I am the small business issuer's sole officer and director and have
disclosed, based on my most recent evaluation of internal control
over financial reporting, to the small business issuer's auditors and
the audit committee of the small business issuer's board of directors
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(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 small
business issuer's ability to record, process, summarize and
report financial information; and
b) Any fraud, whether or not material, that involves management or
other employees who have a significant role in the small business
issuer's internal control over financial reporting.
Date: May 1, 2006
By: /s/ Atul Sharma
--------------------------
Atul Sharma
Chief Executive Officer
EXHIBIT 31.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER
PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Atul Sharma, certify that:
1. I have reviewed this Quarterly Report on Form 10-QSB of Comstock Industries, 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 presented in
this report;
4. I am the sole officer and director and am
responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))
for the small business issuer and have:
a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under my
supervision, to ensure that material information relating to the
small business issuer, including its consolidated subsidiaries,
is made known to me by others within those entities, particularly
during the period in which this report is being prepared;
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b) Paragraph omitted in accordance with SEC transition instructions
contained in SEC Release No. 33-8238, and an extension of the
compliance date in accordance with SEC Release No. 33-8545;
c) Evaluated the effectiveness of the small business issuer'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 small business
issuer's internal control over financial reporting that occurred
during the small business issuer's most recent fiscal quarter
that has materially affected, or is reasonably likely to
materially affect, the small business issuer's internal control
over financial reporting; and
5. I am the small business issuer's sole officer and director and have
disclosed, based on my most recent evaluation of internal control
over financial reporting, to the small business issuer's auditors and
the audit committee of the small business issuer'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 small
business issuer's ability to record, process, summarize and
report financial information; and
b) Any fraud, whether or not material, that involves management or
other employees who have a significant role in the small business
issuer's internal control over financial reporting.
Date: May 1, 2006
By: /s/ Atul Sharma
----------------------
Atul Sharma
Chief Financial Officer
Exhibit 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
I, Atul Sharma, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report of Comstock Industries, Inc. on Form 10-QSB for the quarterly period ended October 31, 2005, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Form 10-QSB fairly presents in all material respects the financial condition and results of operations of Comstock Industries, Inc.
Date: May 1, 2006
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By:/s/ Atul Sharma
---------------------
Atul Sharma
Chief Executive Officer
Exhibit 32.2
CERTIFICATION OF 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, Atul Sharma, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report of Comstock Industries, Inc. on Form 10-QSB for the quarterly period ended October 31, 2005, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Form 10-QSB fairly presents in all material respects the financial condition and results of operations of Comstock Industries, Inc.
Date: May 1, 2006
By:/s/ Atul Sharma
------------------
Atul Sharma
Chief Financial Officer
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