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 July 31, 2002
[ ] 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
-------------------------------------------------------------
(Address of Principal Executive Offices, Including Zip Code)
(561) 361-9326
--------------
(Registrant's Telephone Number, Including Area Code)
---
(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
April 14, 2003, there were 8,185,000 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 July 31, 2002 and April 30,
(b) Statements of Operations for the three month
periods ended July 31, 2002 and July 31, 2001
(c) Statements of Cash Flows for the three month
periods ended July 31, 2002 and July 31, 2001
(d) Statements of Stockholders Equity
(e) 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.
(a) Balance Sheets as of July 31, 2002 and April 30, 2002.
COMSTOCK INDUSTRIES, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
ASSETS July 31, April 30,
2002 2002
(Unaudited) (Audited)
---------- ----------
Current Assets:
Cash and cash equivalents $- $-
---------- ----------
Total Current Assets - -
---------- ----------
Total Assets $- $-
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued $99,076 $93,559
expenses
---------- ----------
Total Current Liabilities 99,076 93,559
---------- ----------
Total Liabilities $99,076 $93,559
Stockholders' Equity:
Preferred stock, 20,000,000 - -
authorized $.0001 par value,
-0- issued and outstanding at
July 31, 2002 and April 30,
2002, respectively
Common stock, 80,000,000 819 819
authorized $.0001 par value,
8,185,885 issued and outstanding
at July 31, 2002 and April 30,
2002, respectively
Additional paid-in capital 123,096 123,096
Retained earnings (deficit) (222,991) (217,474)
---------- ----------
Total Stockholders' Equity (99,076) (93,559)
(Deficit)
---------- ----------
Total Liabilities and $- $-
Stockholders' Equity (Deficit)
========== ==========
__________________
The accompanying notes are an integral part of these consolidated
financial statements.
(b) Statements of Operations for the three month periods ended July
31, 2002 and July 31, 2001.
COMSTOCK INDUSTRIES, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATIONS
(UNAUDITED)
For the Three For the
Months Ended Three Months
July 31, 2002 Ended July
31, 2001
Revenues $ - $ -
Cost of Revenue - -
---------- ----------
Gross Profit - -
Other Costs:
General and Administrative 5,517 18,358
Expenses
---------- ----------
Total Other Costs 5,517 18,358
Other Income and Expense: - -
Interest Income - -
---------- ----------
Net Income (Loss) Before Income (5,517) (18,358)
Taxes
Income Taxes - -
---------- ----------
Net Income (Loss) (5,517) (18,358)
========== ==========
Earnings (Loss) Per Share:
Basic and diluted income (loss) $- $-
per Share
========== ==========
Basic and diluted common shares 8,185,885 8,185,885
__________
The accompanying notes are an integral part of these consolidated
financial statements.
(c) Statements of Cash Flows for the three month periods ended July
31, 2002 and July 31, 2001.
COMSTOCK INDUSTRIES, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOWS
(UNAUDITED)
For the Three For the
Months Ended Three Months
July 31, 2002 Ended July
31, 2001
---------- ----------
Cash Flows from Operating
Activities:
Net income (loss) $(5,517) $(18,358)
Adjustments to reconcile net
income (loss) to net cash used
in operating activities:
Increase in accounts payable 5,517 15,358
and accrued expenses
---------- ----------
Net Cash Used in Operating - (3,000)
Activities
---------- ----------
Cash Flows from Financing
Activities:
Contributed Capital - 3,000
---------- ----------
Net Cash Provided by Financing - 3,000
---------- ----------
Net Increase (Decrease) in Cash - -
and Cash Equivalents
---------- ----------
Cash and Cash Equivalents, - -
beginning of period
---------- ----------
Cash and Cash Equivalents, $- $-
end of period
========== ==========
Supplemental Disclosures of Cash
Flow Information:
Cash paid during period for:
Interest $- $-
========== ==========
Taxes $- $-
========== ==========
The accompanying notes are an integral part of these consolidated
financial statements.
d. Statements of Stock Stockholders Equity.
COMSTOCK INDUSTRIES INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF STOCKHOLDERS EQUITY
Common Stock
$0.0001 Par
Value
Number of Common Additional Retained Total
Shares Stock Paid-In-Cap Earnings Stockholders'
Amount ital (Deficit) Equity
Balances May 1, 1999 818,589 $819 $116,891 $(117,910) $(200)
Net loss for the year
ended April 30, 2002 - -
Contributed Capital 2,000 (3,005) (1,005)
Balances, April 30, 2000 818,589 819 118,891 (120,915) (1,205)
Net Loss for the year
ended April 30, 2001 (55,479) (55,479)
Contributed Capital 1,205
Balances, April 30, 2001 818,589 819 120,096 (176,394) (55,479)
Net Loss for the year
ended April 30, 2002 (41,080) (41,080)
Contributed Capital 3,000
Balances, April 30, 2002 818,589 819 123,096 (217,474) (93,559)
Net loss for the three
months ended July 31,
2002 (Unaudited) (5,517) (5,517)
Balances, July 31, 2002
(Unaudited) 818,589 $819 $123,096 $(222,991) $(99,076)
The accompanying notes are an integral part of these financial
statements.
e. Notes to Financial Statements
COMSTOCK INDUSTRIES INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
JULY 31, 2002
1. DESCRIPTION OF BUSINESS.
Comstock Industries Inc. was originally incorporated on April 3,
1928 under the laws of the State of Nevada as Canadian Metals
Syndicate, Inc. The name of the Company was changed on March 28,
1983 to Comstock Industries, Inc. On July 10, 2000 Comstock
Industries Inc.(Nevada) merged with and into Comstock Industries
Inc. Florida (a Florida Corporation) which changed its name to
Comstock industries Inc.(hereinafter referred to as the "Company").
The Company is a development stage company as defined in SFAS No. 7.
The Company has not engaged in any business operations for at least
the last two years and has no operations to date.
The Company will attempt to identify and negotiate with a business
target for the merger of that entity with and into the company. In
certain instances, a target company may wish to become a subsidiary
of the company or may wish to contribute assets to the company
rather than merge. No assurances can be given that the Company will
be successful in identifying or negotiating with any target company.
The Company seeks to have its securities re-qualified to be traded
in the United States secondary market.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation and Basis of Presentation
The accompanying financial statements consolidate the accounts of
Comstock Industries, Inc. and its wholly-owned subsidiaries. All
significant intercompany accounts and transactions have been
eliminated in consolidation. Certain amounts from prior years have
been reclassified to conform to the current year presentation.
The accompanying unaudited consolidated financial statements have
been prepared pursuant to rules and regulations of the Securities
and Exchange Commission and, therefore, do not include all
information and footnote disclosures normally included in audited
financial statements. However, in the opinion of management, all
adjustments that are of a normal and recurring nature necessary to
present fairly the results of operations, financial position and
cash flows have been made. It is suggested that these statements be
read in conjunction with the financial statements included in the
Company's Annual Report on Form 10-K for the year ended April 30, 2002.
The statements of operations for the three months ended July 31,
2002 are not necessarily indicative of results for the full year.
Earnings (Loss) per Share
The Company computes earnings or loss per share in accordance with
the Financial Accounting Standards Board Statement No. 128 "Earnings
Per Share" (SFAS 128) which replaced the calculation of primary and
fully diluted earnings per share with basic and diluted earnings per
share. Unlike primary earnings per share, basic earnings per share
excludes the dilutive effects of options, warrants and convertible
securities and thus is computed by dividing income available to
common stockholders by the weighted average number of common shares
outstanding. Diluted earnings per share is similar to the previous
fully diluted earnings per share. Diluted earnings per share
reflects the potential dilution that could occur if securities or
other agreements to issue common stock were exercised or converted
into common stock. Diluted earnings per share is computed based
upon the weighted average number of common shares and dilutive
common equivalent shares outstanding.
Recent Accounting Pronouncements
In July 2001, the FASB issued Statement of Financial Accounting
Standards No. 141, (SFAS 141), "Business Combinations" and Statement
of Financial Accounting Standards No. 142, (SFAS 142), "Goodwill and
Other Intangible Assets". SFAS 141 requires all business
combinations to be accounted for using the purchase method of
accounting and is effective for all business combinations initiated
after June 30, 2001. SFAS 142 requires goodwill to be tested for
impairment under certain circumstances, and written off when
impaired, rather than being amortized as previous standards
required. SFAS 142 is effective for fiscal years beginning after
December 15, 2001. Early application is permitted for entities with
fiscal years beginning after March 15, 2001 provided that the first
interim period financial statements have not been previously issued.
The adoption of SFAS 141 had no effect on the Company's operating
results or financial condition. The Company is currently assessing
the impact of SFAS 142 on its operating results and financial
condition.
3. STOCKHOLDERS' EQUITY
The aggregate number of shares of all classes that the corporation
shall have authority to issue is 100,000,000 shares, of which
80,000,000 shares have a par value par of $0.0001 per share and
shall be class designated as "Common Shares" and of which
20,000,000 shares shall have a par value of $0.0001 and shall be
class designated as "Preferred Shares". Holders of shares of common
stock are entitled to one vote for each share on all matters to be
voted on by the stockholders. Holders of common stock do not have
cumulative voting rights. "Preferred Shares" may be issued from time
to time in one or more series to have distinctive serial
designations, as same shall hereafter be determined in the
resolution or resolutions providing for the issuance of such
Preferred Shares from time to time as adopted by the Board of
Directors.
4. Subsequent Events
On January 28, 2003 a shareholder of the company loaned the company
$14,000 in order that the company would bring current their required
securities filings while it continued to attempt to identify a
business target, as was described in Note 1 of the current year's
form 10K-SB.
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 during the three month period ended July 31, 2002, we
have focused our business activities on seeking suitable merger or
acquisition candidates. Accordingly, during the three month period
ended July 31, 2002, we did not generate any revenues and the only
expenses we incurred were in the nature of legal fees and costs.
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.
We have not undertaken any product research and development
during the three month period ended July 31, 2002.
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)
3.3 Articles of Incorporation of Comstock Florida. (2)
3.4 Bylaws of Comstock Florida (2)
99.1 Certifications
(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.
(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: 04/17/03 By: /s/ Atul Sharma
Atul Sharma, President
Date: 04/17/03 By: /s/ Atul Sharma
Atul Sharma, Principal Financial
Officer