vici q1 2006
UNITED
STATES SECURITIES AND EXCHANGE COMMISSION
Washington,
D.C.20549
_______________________________
FORM
10 – QSB
_______________________________
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934.
For
the quarterly period ended March 31,
2006
000-30237
(Commission
File Number)
Victor
Industries, Inc.
(Exact
name of registrant as specified in its charter)
Idaho
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91-0784114
|
(State
or other jurisdiction of
incorporation
or organization)
|
(IRS
Employer
Identification
Number)
|
180
Southwest Higgins Avenue
Missoula,
Montana59803
(Address
of principal executive offices including zip
code)
(406)
549-2261
(Registrant’s
telephone number, including area
code)
with
a copy to:
SteadyLaw
Group, LLP
3580
Utah Street
San
Diego, CA92104
Tel:
(619) 892-3006
Fax:
(619) 330-1888
Indicate by check mark whether
the
registrant (1) has filed all reports required to be filed by Section 13 or
15(d)
of the Exchange Act during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been subject
to such filing requirements for the past 90 days.
Yes
X No _____
Indicate by check mark whether
the
registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange
Act).
Yes ____
No X
As
of May
17, 2006, the Registrant had 500,177,953 shares outstanding of its common
stock.
Item 1.
FINANCIAL STATEMENTS
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VICTOR
INDUSTRIES, INC.
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AND
SUBSIDIARY
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Consolidated
Balance Sheet
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(UNAUDITED)
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March
31,
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2006
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Current
Assets:
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Cash
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$
6,278
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Prepaid
expenses
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137,025
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Total
Current Assets
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$
143,303
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Liabilities
and Stockholders' Deficit
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Current
Liabilities:
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Accounts
Payable and Accrued Expenses
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36,574
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Notes
Payable-Related Parties
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17,530
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Liabilities,
net of assets, of discontinued operations-New Wave Media
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169,850
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Total
Current Liabilities
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223,954
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Stockholders'
Deficit
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Common
stock, $0.0001
par value, 1,000,000,000
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shares
authorized, 500,177,953 shares
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issued
and outstanding
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50,018
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Common
stock issuable, 7,500,000 shares
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750
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Subscription
Receivable
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(54,200)
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Additional
paid in capital
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6,631,754
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Accumulated
deficit
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(6,708,972)
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Total
stockholders' deficit
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(80,651)
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Total
Liabilities and Stockholders' Deficit
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$
143,303
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VICTOR
INDUSTRIES, INC.
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AND
SUBSIDIARY
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Consolidated
Statements of Stockholders' Deficit
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(UNAUDITED)
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Paid
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Issuable
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Common
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Total
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Common
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Common
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In
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Common
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Stock
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Subscription
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Accumulated
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Stockholders'
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Shares
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Stock
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Capital
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Shares
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Issuable
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Receivable
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Deficit
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Deficit
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Balance
at December 31, 2003
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151,221,692
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$
15,122
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$
4,374,934
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$
-
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$
(54,200)
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$
(4,584,582)
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$
(248,726)
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Issued
for payment of debt
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30,199,305
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3,020
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493,362
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496,383
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Issued
for services
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47,595,916
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4,760
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359,476
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364,235
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104,250
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7,500,000
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750
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105,000
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Net
Loss
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(1,215,498)
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(1,215,498)
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Balance
at December 31, 2004
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229,016,913
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22,902
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5,332,022
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7,500,000
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750
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(54,200)
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(5,800,080)
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(498,606)
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Issued
for payment of debt
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26,725,000
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2,673
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306,048
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308,720
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Issued
for services
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8,200,000
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820
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80,180
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81,000
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Net
Loss
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(654,314)
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(654,314)
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Balance
at December 31, 2005
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263,941,913
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26,394
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5,718,249
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7,500,000
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750
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(54,200)
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(6,454,394)
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(763,199)
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Issued
for payment of debt
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175,054,990
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17,505
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542,601
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560,106
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Issued
for services
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34,222,300
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3,422
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237,625
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241,047
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Issued
for prepayment of expenses
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26,958,750
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2,696
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133,279
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135,975
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Net
Loss
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(254,580)
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(254,580)
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Balance
at March 31, 2006
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500,177,953
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$
50,018
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$
6,631,754
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7,500,000
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$
750
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$
(54,200)
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$
(6,708,972)
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$
(80,651)
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VICTOR
INDUSTRIES, INC.
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AND
SUBSIDIARY
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Consolidated
Statements of Operations
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(UNAUDITED)
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Period
from
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January
1, 2006
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January
1, 2005
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To
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To
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March
31, 2006
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March
31, 2005
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Revenue
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$
-
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$
-
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Cost
of sales
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-
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-
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Gross
profit
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-
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-
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Operating
expenses
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Selling
and administrative
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253,751
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111,878
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Depreciation
and Amortization
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-
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760
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Other
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-
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307
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Total
Costs and Expenses
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253,751
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112,945
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Loss
from continuing operations
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(253,751)
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(112,945)
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Interest
Expense
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(829)
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-
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Loss
from continuing operations
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(254,580)
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(112,945)
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Discontinued
operations
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Loss
from operations of New Wave Media
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-
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-
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Net
Loss
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$
(254,580)
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$
(112,945)
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(Loss)
earnings per weighted average share of
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common
stock outstanding
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From
continuing operations
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$
(0.00)
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$
(0.00)
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From
discontinued operations
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$
-
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$
-
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Total
(loss) earnings per share
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$
(0.00)
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$
(0.00)
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Weighted
Average Shares
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326,428,891
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236,516,913
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VICTOR
INDUSTRIES, INC.
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AND
SUBSIDIARY
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Consolidated
Statements of Cash Flows
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(UNAUDITED)
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Period
from
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January
1, 2006
|
January
1, 2005
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To
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To
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March
31, 2006
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March
31, 2005
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Cash
flows from operating activities:
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Net
loss
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$
(254,580)
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$
(112,945)
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Adjustments
to reconcile net loss to net cash provided by
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operating
activities, net of effects from discontinued operations:
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Depreciation
and amortization
|
-
|
760
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Common
stock issued for services
|
241,047
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Change
in Assets and Liabilities
|
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|
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Prepaid
expenses
|
(1,050)
|
10,957
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|
Accounts
payable and accrued expenses
|
158,435
|
79,810
|
|
|
|
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|
Cash
provided by Operating Activities
|
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|
143,852
|
90,767
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Provided
(Used) by Financing Activities
|
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Loans
from Shareholders
|
|
17,530
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Payments
to Shareholders
|
|
(157,806)
|
21,850
|
Net
cash provided by financing activities
|
|
|
(140,276)
|
21,850
|
|
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Net
increase in cash
|
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|
3,576
|
112,617
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Cash
at beginning of period
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|
2,702
|
19
|
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Cash
at end of period
|
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|
$
6,278
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$
112,636
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SUPPLEMENTAL
INFORMATION:
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Interest
paid
|
$
-
|
$
-
|
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|
Taxes
paid
|
$
-
|
$
-
|
|
|
|
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|
SUPPLEMENTAL
NON CASH INVESTING AND FINANCING ACTIVITIES:
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Common
stock issued for debt
|
$
560,106
|
$
-
|
|
|
Common
stock issued for prepaid services
|
135,975
|
13,000
|
|
|
|
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|
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
Three
months ended March 31, 2006
Note
1. Summary of Significant Accounting Policies
Business
Operations
Victor
Industries, Inc. was originally organized under the laws of the State of
Idaho
on January 19, 1926, under the name of Omo Mining and Leasing Corporation.
After several name changes through the years, the name was changed to Victor
Industries, Inc. on December 24, 1977. In 1993, the Company began zeolite
mining and marketing operations. Zeolite is an ammonia absorbent, air purifier,
and hazardous waste absorbent. Victor Industries, Inc. is presently refining
the
development of and marketing a fertilizer product using zeolite.
Consolidation
The
accompanying consolidated financial statements include the accounts of Victor
Industries, Inc. and its wholly owned subsidiary, New Wave Media (collectively
the "Company"). All inter-company accounts and transactions have been
eliminated.
Interim
Period Financial Statements
The
interim period consolidated financial statements have been prepared by the
Company pursuant to the rules and regulations of the U.S. Securities and
Exchange Commission (the "SEC"). Certain information and footnote disclosure
normally included in financial statements prepared in accordance with accounting
principles generally accepted in the United States have been condensed or
omitted pursuant to such SEC rules and regulations. The interim period
consolidated financial statements should be read together with the audited
consolidated financial statements and accompanying notes for the years ended
December 31, 2005 and 2004, included in the Company's annual reports on
Form 10-KSB. In the opinion of the Company, the unaudited consolidated financial
statements contained herein contain all adjustments necessary (consisting
of a
normal recurring nature) to present a fair statement of the results of the
interim periods presented.
The
results of operation for the three months ended March 31, 2006, are not
necessarily indicative of the results to be expected for the entire year
ending
December 31, 2006.
Discontinued
Operations
The
Company's subsidiary, New Wave Media, operated a radio station in Montana,
utilizing a Time Brokerage Agreement. In July 2003, the licensee of the Time
Brokerage Agreement shut down the radio station claiming non-payment of the
required fees. On August 20, 2003, the Montana Eighth Judicial District
Court awarded New Wave Media a permanent injunction. The Company has filed
litigation against the licensee for monetary damages. During October 2003,
the
Company reported that the licensee once again turned the power off at the
radio
station. The Company has made the decision not to attempt to gain another
injunction and instead exercise its legal rights in court. Accordingly,
operating results of this segment have been presented as discontinued operations
in these consolidated financial statements.
Note
2. Going Concern
The
accompanying consolidated financial statements have been prepared assuming
that
the Company will continue as a going concern. However, the Company has incurred
continuing operating losses and has an accumulated deficit of $6,708,972
as of
March 31, 2006. The Company's ability to continue as a going concern is in
substantial doubt and is dependent upon obtaining additional financing and
achieving a sustainable profitable level of operations. The consolidated
financial statements do not include any adjustments that might result from
the
outcome of this uncertainty. The Company has met its historical working capital
requirements from sale of capital shares and loans from shareholders. However,
there can be no assurance that such financial support shall be ongoing or
available on terms or conditions acceptable to the Company.
Note
3. Earnings Per Share
Basic
loss per share is computed by dividing the net loss available to common
shareholders by the weighted average number of common shares outstanding
in the
period. Diluted earnings per share takes into consideration common shares
outstanding (computed under basic earnings per share) and potentially dilutive
common shares. Diluted earnings per share takes into consideration common
shares
outstanding (computed under basic earnings per share) and potentially dilutive
common shares. There were no dilutive securities outstanding at March 31,
2006
or 2005.
Common
stock issuable is considered outstanding as of the original approved date
for
purposes of earnings per share computations.
Note
4. Stock Based Compensation
Prior
to
January 1, 2006, the Company accounted for stock-based awards under the
intrinsic value method, which followed the recognition and measurement
principles of APB Opinion No. 25, “Accounting for Stock Issued to Employees”,
and related Interpretations. The intrinsic value method of accounting
resulted in compensation expense for stock options to the extent that the
exercise prices were set below the fair market price of the Company’s stock at
the date of grant.
As
of
January 1, 2006, the Company adopted SFAS No. 123(R) using the modified
prospective method, which requires measurement of compensation cost for all
stock-based awards at fair value on the date of grant and recognition of
compensation over the service period for awards expected to vest. The fair
value of stock options is determined using the Black-Scholes valuation model,
which is consistent with the Company’s valuation techniques previously utilized
for options in footnote disclosures required under SFAS
No.
123, “Accounting for Stock Based Compensation”, as amended by SFAS No. 148,
“Accounting for Stock Based Compensation Transition and
Disclosure”.
Since
the
Company did not issue stock options to employees during the three months
ended
March 31, 2006 or 2005, there is no effect on net loss or earnings per share
had
the Company applied the fair value recognition provisions of SFAS No. 123(R)
to
stock-based employee compensation. When the Company issues shares of
common stock to employees and others, the shares of common stock are valued
based on the market price at the date the shares of common stock are approved
for issuance.
Note
5. Subsequent Events
On
April
20, 2006, Victor Industries, Inc. (the “Registrant”), with the approval of its
Board of Directors, executed an Agreement and Plan of Merger ("APR Merger”) with
San Diego, CA based Ethos Environmental, Inc. (“Ethos”), a Nevada
corporation.
The
closing of the APR Merger is still subject to various customary closing
conditions, including but not limited to shareholder approval by both companies.
Additionally, the APR Merger is subject to special closing conditions including
effectuating a reverse stock split based on a ratio of approximately 1:1000
and
the Registrant redomiciling to the State of Nevada.
In
April
2006 the Company cancelled 11,000,000 shares current being held by the Company
on behalf of Black Star Petroleum. The original transaction was recorded
as a subscription receivable, but on December 31, 2003 the Company cancelled
the
transaction as a result of Black Star Petroleum in ability to pay the
receivable.
In
April
2006 the Company borrowed $4,500 from an officer and director, and $2,000
from a
shareholder.
ITEM 2. MANAGEMENT'S
DISCUSSION AND ANALYSIS AND PLAN OF OPERATION
This discussion and analysis
should be read in conjunction with the accompanying Consolidated Financial
Statements and related notes. Our discussion and analysis of our financial
condition and results of operations are based upon our consolidated financial
statements, which have been prepared in accordance with accounting principles
generally accepted in the United States. The preparation of financial statements
in conformity with accounting principles generally accepted in the United States
of America requires us to make estimates and assumptions that affect the
reported amounts of assets and liabilities, disclosure of any contingent
liabilities at the financial statement date and reported amounts of revenue
and
expenses during the reporting period. On an on-going basis we review our
estimates and assumptions. Our estimates are based on our historical experience
and other assumptions that we believe to be reasonable under the circumstances.
Actual results are likely to differ from those estimates under different
assumptions or conditions, but we do not believe such differences will
materially affect our financial position or results of operations. Our critical
accounting policies, the policies we believe are most important to the
presentation of our financial statements and require the most difficult,
subjective and complex judgments, are outlined below in ‘‘Critical Accounting
Policies,’’ and have not changed significantly.
In addition, certain statements
made in this report may constitute “forward-looking statements”. These
forward-looking statements involve known or unknown risks, uncertainties and
other factors that may cause the actual results, performance, or achievements
of
the Company to be materially different from any future results, performance
or
achievements expressed or implied by the forward-looking statements.
Specifically, 1) our ability to obtain necessary regulatory approvals for
our products; and 2) our ability to increase revenues and operating income,
is dependent upon our ability to develop and sell our products, general economic
conditions, and other factors. You can identify forward-looking statements
by
terminology such as "may," "will," "should," "expects," "intends," "plans,"
"anticipates," "believes," "estimates," "predicts," "potential," "continues"
or
the negative of these terms or other comparable terminology. Although we believe
that the expectations reflected-in the forward-looking statements are
reasonable, we cannot guarantee future results, levels of activity, performance
or achievements.
OVERVIEW
The following management
discussion and analysis relates to the business of Victor Industries, Inc.,
which develops, manufactures, and markets products related to the use of the
mineral known as zeolite. Zeolites have the unique distinction of being nature's
only negatively charged mineral. Zeolites are useful for metal and toxic
chemical absorbents, water softeners, gas absorbents, radiation absorbents
and
soil and fertilizer amendments. Clinoptilolite, one type of natural zeolite,
is
our primary focus. Clinoptilolite's absorption capabilities of ammonia provide
a
number of applications in the agricultural industry. We are primarily focusing
on two zeolite compounds in order to produce revenue. We believe that the two
primary sources of nitrate and phosphate pollution are fertilizers and large
animal feeding operations.
ENVIROLIZER was formulated
around
the use of zeolite to absorb the ammonia that is released by animal discharge
from large animal feeding operations. We will then utilize the nutrients from
the absorption process and turn it into a slow demand release fertilizer. We
believe that wide spread use of our absorption process will significantly reduce
pollution from these feeding operations while reducing the leaching of nitrates
and phosphates into the ground water. Because of the absorption capabilities
of
zeolite, we believe that our fertilizer compound will work effectively for
up to
three years, depending on the type of crop or plants being fertilized, thereby
reducing the need for multiple fertilizer applications every year. The
ENVIROLIZER fertilizer compound is expected to absorb up to 45% of its weight
in
water and slowly release it when the soil begins to dry thus reducing the
irrigation cycle. We cannot give any assurances that we will be successful
in
producing a marketable or profitable product.
The financial statements
have been prepared in conformity with accounting principles generally accepted
in the United States of America, which contemplate continuation of the Company
as a going concern. Although the Company’s revenues and gross margins increased
significantly in recent periods, it has sustained significant operating losses
in the first quarter of 2006 and the years 2005 and 2004. At March 31, 2006,
the
Company had stockholders’ deficit of $80,651 and a working capital deficiency of
$80,651. The Company believes its resources are sufficient to fund its needs
through mid second quarter of 2006 and it is considering alternatives to provide
for its capital requirements for the balance of 2006 and beyond in order to
continue as a going concern. Its liquidity and cash requirements will depend
on
several factors. These factors include (1) the level of revenue growth; (2)
the
extent to which, if any, that revenue growth improves operating cash flows;
(3)
its investments in research and development, facilities, marketing, regulatory
approvals, and other investments it may determine to make, and (4) the
investment in capital equipment and the extent to which it improves cash flow
through operating efficiencies. There are no assurances that it will be
successful in raising sufficient capital.
FIRST
QUARTER HIGHLIGHTS
During the period ended March
31,
2006, the Company had several important developments:
On or about January 5, 2006,
in an
effort to increase domestic awareness for its products, the Company finalized
arrangements to test its organically formulated EnviroTurf(tm) with one of
the
largest sod and turf distributors/producers in America, Southern Sod. While
results from such testing are not yet available, the Company anticipates that
if
such tests are successful, then the Company will be able to make substantial
inroads into the lucrative domestic sod and turf market, paving the way for
sales to numerous retail outlets which have strategic relationships with other
sod and turf distributors. Testing is currently underway and results are
expected in the near future.
In February 2006,
internationally-renowned Chinese College Hangzhou Vocational Training College
(HVTC), which has long-standing relationships with some of the most successful
large scale private horticultural and agricultural enterprises on mainland
China, has submitted a testing regime to Victor Industries that will test the
effectiveness of its products on over 100 plant genera. HVTC has identified
the
Company’s EnviroTurf™ product as one of special interest due to its ability to
effectively reduce water consumption by 50% and the need for fertilizer by
some
80%. It is anticipated that substantial orders will result from the
successful testing and accreditation of our products by HVTC
Also in February 2006, the
Company
announced that the Self Realization Lakeside Shrine in Pacific Palisades,
California, which attracts tens of thousands of visitors each year to its koi
filled lake and serine seaside gardens approached the Company for assistance.
The garden, with its central lake, was established in the late nineteen-thirties
and is noted for the countless fifty year old koi which inhabit the lake;
countless not because they are innumerable but because the lake has become
so
polluted the koi, once a main attraction of the gardens, can no longer be seen.
The primary mineral constituent
of
our organic product line can be ground to a sand like consistency and used
as an
excellent water filtration medium, less expensive and more effective than
diatomaceous earth. Further, because of its cation exchange properties, our
filter medium H2Only will naturally absorb the fish waste (ammonia compounds)
clouding the lake. Limiting ammoniates will help control the growth of algae
and
contribute to the further clearing of the lake water.
Most remarkably, when the H2Only
has become saturated with waste products it can be extracted from the lake
and
used as an excellent water retentive organic fertilizer in the surrounding
gardens.
In addition to the above, the
Company announced that negotiations with FSP China had been terminated.
During the quarter ended March 31, 2006, the Company entered into merger
negotiations with Ethos Environmental, Inc. a Nevada corporation (“Ethos”) by
executing a Letter of Intent on or about March 27, 2006 (as announced in a
Press
Release). By way of Form 8-K filed on March 31, 2006, incorporated by
reference herein, the Company announced that merger discussions with Ethos
were
progressing rapidly, and anticipated no hurdles in reaching a definitive
agreement sometime shortly thereafter.
Critical Accounting
Policies and Estimates
We believe that there are several
accounting policies that are critical to understanding our historical and future
performance, as these policies affect the reported amounts of revenue and the
more significant areas involving management’s judgments and estimates. These
significant accounting policies relate to revenue recognition, research and
development costs, valuation of inventory, valuation of long-lived assets and
income taxes. For a summary of our significant accounting policies (which have
not changed from December 31, 2005), see our annual report on Form 10-KSB for
the period ended December 31, 2005.
RESULTS OF
OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2006 AS COMPARED WITH THE THREE
MONTHS ENDED MARCH 31, 2005
The following analysis of
historical financial condition and results of operations are not necessarily
reflective of the on-going operations of the Company.
Overall Operating Results
-
Comparison to Quarter Ended March 31, 2005
We had no zeolite sales for
during
the quarter ended March 31, 2006. We anticipate that increased marketing
efforts and the successful approval of our patent for the fertilizer compound
in
the future will generate the required revenues to sustain our anticipated
growth. There can be no assurances that such sales will occur.
Selling & Administrative
expenses incurred during the quarter totaled $253,751. These expenses were
incurred primarily for the following reasons:
·
|
Legal fees of approximately
$11,525.
|
·
|
Accounting, audit
and
bookkeeping fees totaling approximately
$12,775.
|
·
|
Business consulting
fees of
$227,247.
Outside services
of
$1,250
Office expenses of
$954
|
·
|
Advertising, promotion
and
related travel expenses of $0.
|
Similar expenses incurred for
the
quarter ended March 31, 2005 were $111,878 and were incurred primarily for
consulting services of a similar nature.
Also, for comparison purposes,
there were no newly issued shares for the payment of services during the period
ended March 31, 2006, just as there were no new shares issued for services
during the period ended March 31, 2005.
We incurred a net loss for
the
current quarter of $254,580 as compared to a net loss of $112,945 for the
comparable prior year quarter. These losses were attributable to the
aforementioned operating expenses.
Income
Taxes
We have accumulated approximately
$6,708,972 million of net operating loss carry-forwards as of March 31, 2006,
that may be offset against future taxable income. There will be limitations
on
the amount of net operating loss carry-forwards that can be used due to the
change in the control of the management of the Company. No tax benefit has
been
reported in the financial statements, because we believe there is a 50% or
greater chance the carry-forwards will expire unused.
Accordingly, the potential
tax
benefits of the loss carry-forwards are offset by valuation allowance of the
same amount.
LIQUIDITY AND
CAPITAL
RESOURCES
We have been financed through
related parties as there has been no substantial revenue generated to date.
During the quarter ended March 31, 2006 the Company received $17,530 in loans
from Penny Sperry, Lana Pope and Blue Rock Minerals, officers and
shareholders. They have agreed to accept restricted stock in satisfaction
of the aforementioned loans and those payments for the period equal
$157,806. The Company did not engage in any offering of any kind
during the quarter ended March 31, 2006.
We will need additional financing
in order to implement our business plan and continue as a going concern. We
do
not currently have a source for any additional financing and we cannot give
any
assurances that we will be able to secure any financing.
Inflation
Our results of operations have
not
been affected by inflation and we do not expect inflation to have a significant
effect on its operations in the future.
RECENT DEVELOPMENTS
AND
VICTOR INDUSTRIES” PLAN OF OPERATIONS FOR THE NEXT TWELVE
MONTHS
Please
see section entitled Overview and in particular the “First Quarter
Highlights.”
Fertilizer
Business
During 2005, and to date in
2006,
the Company has made progress in marketing the Envirolizer product to large
potential customers. A preeminent sod farm in Southern California has agreed
to
conduct a one acre test. Such tests have been conducted in the past and we
are
confident that the results will convince the sod company to begin to implement
Envirolizer in the balance of their properties as well as influence other sod
companies to begin using the product. This influential sod company has
approximately 1000 retail outlets in the form of garden centers, nursery stores
and landscape companies that will directly hear the Envirolizer story from
the
sod company. Our own labeling is being discussed. Sod beds are often
alternated with vegetable crops and it is anticipated that the clear benefits
of
Envirolizer will be demonstrated for several growing seasons in sod as well
as
in alternated crops. This way we hope to attract further agricultural and
horticultural interest.
Victor Industries has made
progress in securing sales in Mainland China. We have developed a contact that
has gained permission to conduct tests of Envirolizer at a prominent
ChineseUniversity, a necessary prerequisite for significant sales on the
mainland. Awareness of the products ability to mitigate nitrogen compounds
from migrating into the water table is of much interest to those in Beijing
preparing for the 2008 Olympics.
Victor Industries has won approval
to clean the waters of the Lakeside Shrine in Pacific Palisades, California
to
demonstrate the effectiveness of our products in absorbing ammonium produced
by
the large coy that live in the lake.
The shrine is well known and
we
believe our success there will lead to publicity regarding our products that
no
amount of advertising dollars could pay for.
The management has continued
development of a diagnostic cat litter. Economic sources have been found
for the three main components necessary to produce a cat premium cat
litter which is capable of diagnosing FUS Feline Urinary Syndrome which effects
as many as sixty percent of all cats and is often fatal if not diagnosed in
a
timely fashion.
Long-term price stability
contracts are in process to ensure economical exclusive access to the world
largest and purest form of the primary mineral which is the basis to all our
products.
Acquisitions and
Mergers
Victor Industries is interested
in
acquiring businesses outside of the Company's traditional fertilizer business.
In this regard, the Company will continue to explore opportunities that have
been presented to the Company from other private and public
entities.
In our opinion, the Company
will
have to raise working capital from outside sources during the next twelve months
to meet our obligations and commitments as they become payable. Historically,
we
have been successful in our efforts to secure working capital from private
placements of common stock and loans from private investors.
If the merger agreement with
Ethos
closes as expected, the Company is expected to spin off its present operations
into a new entity, Enviroteck Industrial Group, Inc., and issue a dividend
share
to all Company shareholders on the day prior to the closing of the anticipated
merger with Ethos.
Inflation
Our results of operations have
not
been affected by inflation and we do not expect inflation to have a significant
effect on our operations in the future.
New
Wave Media Corp.
The
station has been closed and all employees dismissed.
ITEM 3. CONTROLS AND
PROCEDURES
Evaluation of Disclosure
Controls and Procedures
As of the end of the period
covered by this report, the Company conducted an evaluation under the
supervision and with the participation of the principal executive officer and
principal financial officer, of the Company’s disclosure controls and procedures
(as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange
Act
of 1934 (the “Exchange Act”)). Based on this evaluation, the principal executive
officer and principal financial officer concluded that the Company’s disclosure
controls and procedures are effective to ensure that information required to
be
disclosed by the Company in reports that it files or submits under the Exchange
Act is recorded, processed, summarized and reported within the time periods
specified in Securities and Exchange Commission rules and forms.
Changes In Internal Controls
Over Financial Reporting
There have been no changes
in
internal controls over financial reporting that occurred during the most recent
fiscal quarter that have materially affected, or are reasonably likely to
materially affect, our internal controls over financial reporting.
PART
II.
ITEM 1. LEGAL
PROCEEDINGS
None.
ITEM 2.
UNREGISTERED
SALES OF EQUITY SECURITIES AND USE OF
PROCEEDS.
None.
ITEM 3.
DEFAULTS UPON
SENIOR SECURITIES
None.
ITEM 4.
SUBMISSION OF
MATTERS TO A VOTE OF SECURITY HOLDERS
None during the quarter
ended March 31, 2006.
ITEM 5. OTHER
INFORMATION
Subsequent to the quarter ended
March 31, 2006, by way of Form 8-K filed on or about April 24, 2006, the Company
announced that it had executed a Definitive Material Agreement with Ethos,
subject to shareholder approval. On or about April 25, 2006, the Company
filed a Preliminary Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934. Each of these documents is fully
incorporated by reference herein.
ITEM 6.
EXHIBITS AND
REPORTS ON FORM 8-K
(a) Exhibits.
EXHIBIT
NUMBER
|
DESCRIPTION
|
LOCATION
|
3.1 -
3.2
|
Articles of
Incorporation and Bylaws
|
Previously
Filed.
|
31.1
|
Rule
13a-14(a)/15d-14(a) Certification (CEO)
|
Filed
herewith
|
31.2
|
Rule
13a-14(a)/15d-14(a) Certification (CFO)
|
Filed
herewith
|
32.1
|
Section 1350
Certification (CEO)
|
Filed
herewith
|
32.2
|
Section 1350
Certification (CFO)
|
Filed herewith
|
(b)
Reports on Form 8-K.
The following reports on Form 8-K are incorporated by reference
herein:
(a)
Form 8-K filed on March 31, 2006.
(b)
Form 8-K filed on April 24, 2006
SIGNATURES
Pursuant to the requirements
of the Securities Exchange Act of 1934, the Registrant has duly caused this
report to be signed on its behalf by the undersigned thereunto duly authorized.
DATE: May 22,
2006
|
VICTOR INDUSTRIES,
INC.
(Registrant)
By: /s/
Lana
Pope
|
|
Lana Pope
Director, CEO
and
CFO
|