UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                   FORM 10-KSB

   X Annual Report Pursuant to Section 13 or 15 (d) of the Securities Exchange
                                  Act of 1934
                  For the fiscal year ended: December 31, 2003
                                       or
      Transition Report Pursuant to Section 13 or 15 (d) of the Securities
                              Exchange Act of 1934

                        Commission File Number: 0-23819

                            COLE COMPUTER CORPORATION
                 (Name of small business issuer in its charter)

          Nevada                                               76-0547762
(State of incorporation)                                (I.R.S. Employer ID no.)

                            5577 Northwest Expressway
                          Oklahoma City, Oklahoma 73132
              (Address of Principal Executive Offices) (Zip Code)
         Issuer's telephone number, including area code: (405) 721-7600

                                      N/A
                          (Former Name of Registrant)

          Securities registered pursuant to Section 12(b) of the Act:
                                      None

          Securities registered pursuant to Section 12(g) of the Act:
                    Common Stock (par value $0.001 per share)
                                (Title of Class)

Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Securities Exchange Act of 1934 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 at least the past 90
days. Yes [X] No [ ]

Check if there is no disclosure of delinquent filers pursuant to Item 405 of
Regulation S-B contained herein, and will not be contained, to the best of
Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-KSB or any amendment to
this Form 10-KSB. [ ]

Revenues of issuer for its most recent fiscal year: $4,057,187

Aggregate market value of voting stock held by non-affiliates as of March 24,
2004: $551,738 (9,195,625 shares at $0.06 per share).

Shares of Common Stock outstanding as of March 24, 2004: 15,437,400.

<PAGE>

                            COLE COMPUTER CORPORATION
                        2002 ANNUAL REPORT ON FORM 10-KSB
                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----
PART  I

Item  1.  Description of Business                                              1

Item  2.  Description of Properties                                            4

Item  3.  Legal Proceedings                                                    4

Item  4.  Submission of Matters to a Vote of Security Holders                  4

PART  II

Item  5.  Market for Common Equity and Related Stockholder Matters             5

Item  6.  Management's Discussion and Analysis or Plan of Operations           6

Item  7.  Financial Statements                                                 8

Item  8.  Changes in and Disagreements with  Accountants
          on Accounting and Financial Disclosure                              23

Item 8A.  Controls and Procedures                                             23

PART  III

Item  9.  Directors, Executive Officers Promoters and Control Persons;
          Compliance with Section 16(a) of the Exchange Act                   23

Item  10. Executive Compensation                                              25

Item  11. Security Ownership of Certain Beneficial Owners
          and Management and Related Stockholder Matters                      27

Item  12. Certain Relationships and Related Transactions                      29

Item  13. Exhibits and Reports on Form 8-K                                    31

Item  14. Principal Accountant Fees and Services                              31

SIGNATURES                                                                    32


<PAGE>

                                     PART I

Item 1. Description of Business.

     The Company is a computer corporation which began out of the garage of
founders Cynthia A. and Homer O. Cole III, in November 1991, doing business as
Computer Masters, which filled a valuable niche in Oklahoma's computer community
providing helpful friendly service while upgrading customer's computers at a
fraction of the cost of new systems sold by competitors. The customer demand for
helpful service, low cost and state of the art computers drove Computer Masters
into the marketing of new computers, in wholesale and retail sales. Computer
Masters commenced doing business as "Computer Masters" in 1996, and through high
volume sales, was able to aggressively purchase computer parts gaining
purchasing power, while reducing computer costs and passing these savings on to
customers. Customer demand dictated Computer Masters' growth from a statewide
corporation into a multistate corporation with stores in Arkansas, and Oklahoma.

     On or about March 1, 2004, the Company's management decided to cease doing
business as a retail computer sales operation. Accordingly, all activities have
been treated as discontinued operations. Agreements are currently being prepared
to dispose of its operations through the sale to another entity or liquidation
of the business. Further, agreements are currently being negotiated to determine
the future operations of the Company. At this time, no definitive contracts have
been completed to either dispose of the activities or change its operations.

Principal Products or Services and their Markets.

     Computer Masters has found that rural and small-town computer markets have
been left alone by the major computer companies which have chosen to focus on
sales of complete systems alone or by major retailers, who fail to offer parts,
upgrade components or professional support to the computer user.

     At December 31, 2003 the Company operated five (5) retail storefront
locations under the name of Computer Masters for components, upgrade parts and
complete personal computers for use in the home, business and professional and
government markets. All Computer Masters locations provide complete sales and
service, including full upgrade capabilities to its customers, no matter which
brand or manufacturers' computer system a customer may have.

     Even as important as retail storefront sales, the Company has integrated a
direct marketing plan using the Internet via its web sites (www.okcmasters.com),
along with "direct to the customer" mail order, similar to Dell and Gateway
Computers, to satisfy the demand of price conscious, "do-it-yourself" Internet
customers. The Company's web sites have complete e-commerce capabilities for
retail, government and wholesale buyers, including a shopping cart with a secure
credit card payment system. The implementation of each phase places the Company
in an opportune position to market its products and services in select niches,
including the exciting Internet marketplace across the World Wide Web.

     The Company has built solid commercial relationships with major
manufacturers and other suppliers of parts and upgrade components. The ability
to purchase directly from the manufacturer or to capitalize on discounted prices
from other sources has been a key element in the advantageous cost structure of
Computer Masters. In addition, the Company follows, in philosophy and in
practice, the inventory methodology of "Just in Time" or JIT. This JIT inventory
practice has kept the Company's inventory purchase costs as close to the current
market of many price sensitive parts. While this practice requires virtually
daily ordering and a continual management of all price sensitive inventory, the
management time (and inventory control system) yields benefits that far exceed
the extra effort. In the world we live in, a UPS/FEDEX/Overnight US Mail
delivery of JIT often saves substantial sums when inventory prices are
declining. In an upwardly spiraling market, the Company can simply adjust its
wholesale/retail prices to reflect daily price changes.

     An important element of the Company's success has been the honest, quality
personnel retained by Computer Masters. All of the Company's employees embody
the philosophy of being "Your Best Friend in Computers."

Competition.

     Cole targeted an under served market where the big chain computer stores
and major computer manufacturers have not properly served their customers nor
offered the customized solutions that their customers need. The traditional
"direct" sales companies such as Dell, Gateway, Compaq and HewlettPackard (HP)
compete against Cole in the prebuild and custom build complete computer service
market almost exclusively. Cole's advantage is the aftermarket service and sales
as well as upgrade and ancillary computer component market.

                                       1
<PAGE>

     The main competition for Cole is the "whitebox" stores. The Company
maintains a competitive advantage through its pricing strategy where it is able
through its volume purchases and volume discounts to undercut the competition
while maintaining additional loyalty through high quality service, sales and
after sales service to the customer.

Sources and Availability of Raw Materials.

     The Company purchases component and upgrade parts from a number of
suppliers for further assembly or resale activities of complete component
systems or upgrade and/or component parts. Most materials are readily available
from suppliers.

Patents, Trademarks, Licenses, Franchises, Concessions, Royalty Agreements or
Labor Contracts.

     The only trademark or trade name of the Company is "Computer Masters."

Governmental Approval of Principal Products or Services.

     None, except as may be required in the bidding process for government
contracts.

Effects of Existing or Probable Governmental Regulations.

     The integrated disclosure system for "small business issuers" adopted by
the Securities and Exchange Commission in Release No. 3430968 and effective as
of August 13, 1992, substantially modified the information and financial
requirements of a small business issuer, defined to be an issuer that has
revenues of less than $25,000,000; is a U.S. or Canadian issuer; is not an
investment company; and if a majority owned subsidiary, the parent is also a
small business issuer; provided, however, an entity is not a small business
issuer if it has a public float (the aggregate market value of the issuer's
outstanding securities held by nonaffiliates) of $25,000,000 or more. The
Company is a "small business issuer," based upon these guidelines.

     On the effectiveness of the Company's Form 10-SB Registration Statement,
the Company became subject to the reporting obligations under the Securities
Exchange Act of 1934, as amended (the "1934 Act."). These requirements include,
among others, that the Company must file with the Securities and Exchange
Commission annual reports on Form 10-KSB ("SB" denotes a "small business
issuer") that contain audited financial statements; quarterly reports on 10-QSB
that contain reviewed financial statements; 8K Current Reports reporting current
material events; and proxy or information statements governed by Regulation 14A
or 14C of the Securities and Exchange Commission that are then mailed to
stockholders for any matter requiring the vote or consent of stockholders.
Principals or 5% stockholders of the Company are also required to report their
beneficial ownership and any changes in this ownership on appropriate forms.
Directors, executive officers and 10% stockholders are also subject to Section
16(b) of the 1934 Act respecting "short swing" profits.

     Our common stock is "penny stock" as defined in Rule 3a511 of the
Securities and Exchange Commission. Penny stocks are stocks:

     -    with a price of less than five dollars per share;

     -    that are not traded on a "recognized" national exchange;

     -    whose prices are not quoted on the NASDAQ automated quotation system;
          or

     -    in issuers with net tangible assets less than $2,000,000, if the
          issuer has been in continuous operation for at least three years, or
          $5,000,000, if in continuous operation for less than three years, or
          with average revenues of less than $6,000,000 for the last three
          years.

     Section 15(g) of the Exchange Act and Rule 15g2 of the Securities and
Exchange Commission require broker/dealers dealing in penny stocks to provide
potential investors with a document disclosing the risks of penny stocks and to
obtain a manually signed and dated written receipt of the document before making
any transaction in a penny stock for the investor's account. You are urged to
obtain and read this disclosure carefully before purchasing any of our shares.

                                        2
<PAGE>

     Rule 15g9 of the Securities and Exchange Commission requires broker/dealers
in penny stocks to approve the account of any investor for transactions in these
stocks before selling any penny stock to that investor. This procedure requires
the broker/dealer to:

     -    get information about the investor's financial situation, investment
          experience and investment goals;

     -    reasonably determine, based on that information, that transactions in
          penny stocks are suitable for the investor and that the investor can
          evaluate the risks of penny stock transactions;

     -    provide the investor with a written statement setting forth the basis
          on which the broker/dealer made his or her determination; and

     -    receive a signed and dated copy of the statement from the investor,
          confirming that it accurately reflects the investor's financial
          situation, investment experience and investment goals.

     Compliance with these requirements may make it harder for our stockholders
to resell their shares.

Cost and Effect of Compliance with Environmental Laws.

     There are no material environmental laws, rules or regulations effecting
the present and intended business operations of the Company.

Research and Development Expenses.

     None.

Number of Employees.

     16 full time employees, and one part-time employee.




                                        3
<PAGE>

Item 2. Description of Property.

     Computer Masters leases five stores and a corporate office occupying office
space in one store.

     Store  Number            Square  Footage              Term Expires
     -------------            ---------------              ------------

      3                        1,500  sq.  ft.             May  2004

      4                        3,200  sq.  ft.             Oct  2007

      6                        1,000  sq.  ft.             month to month

      7                        1,500  sq.  ft.             Feb  2004

      9                          900  sq.  ft              month to month



     TOTAL:                    8,100  sq.  ft.



Item 3. Legal Proceedings.

     The Company is not a party to any pending legal proceeding. No federal,
state or local governmental agency is presently contemplating any proceeding
against the Company. No director, officer or affiliate of the Company or owner
of record or beneficially of more than five percent of the Company's common
stock is a party adverse to the Company or has a material interest adverse to
the Company in any proceeding.

Item 4. Submission of Matters to a Vote of Security Holders.

     There were no matters submitted to a vote of security holders in 2003.



                                       4
<PAGE>

                                     PART II

Item 5. Market for Common Equity and Related Stockholder Matters.

Market Information.

     The Company's common stock is quoted on the OTC Bulletin Board of the
National Association of Securities Dealers, Inc. (the "NASD") under the symbol
"COLV.OB". The common stock is thinly traded and no assurance can be given that
any market for the Company's common stock will be maintained. The following bid
quotations reflect inter-dealer prices without adjustment for retail markups,
markdowns, or commissions and may not reflect actual transactions.

Stock  Quotations

                                         2003                 2002
                                         ----                 ----
     Quarter Ended                  High      Low         Low       High
     -------------                  ----      ---         ---       ----

     March  31                     $0.15      $0.06      $0.57      $0.28

     June  30                      $0.13      $0.06      $0.49      $0.14

     September  30                 $0.13      $0.04      $0.28      $0.12

     December  31                  $0.06      $0.03      $0.27      $0.06


Holders.

     The number of record holders of the Company's common stock as of April 14,
2004, was approximately 345.

Dividends.

     The Company has not declared any cash dividends with respect to its common
stock, and does not intend to declare dividends in the foreseeable future. The
present intention of management is to utilize all available funds for the
development of the Company's business. There are no material restrictions
limiting, or that are likely to limit, the Company's ability to pay dividends on
its common stock.






                                        5
<PAGE>

Item 6. Management's Discussion and Analysis of Financial Condition and Results
of Operations.

     The following discussion highlights our Company's performance and it should
be read in conjunction with the financial statements (including related notes)
accompanying this Report. Certain statements contained herein may constitute
forward looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. These statements are based on management's
current expectations and are subject to uncertainty and changes in
circumstances. Actual results may differ materially from those expectations due
to changes in global politics, economics, business, competitors, competition,
markets and regulatory factors. More information about these factors has been or
will be contained in Cole's filings with the Security and Exchange Commission.

     On or about March 1, 2004, the Company's management decided to cease doing
business as a retail computer and sales operation. Accordingly, all activities
have been treated as discontinued operations. Agreements are currently being
prepared to dispose of its operations through the sale to another entity or
liquidation of the business. Further, agreements are currently being negotiated
to change the management of the Company as well as determine its future method
of operation. At this time, no definitive contracts have been completed to
either dispose of the activities or change its operations. All assets of the
Company have been reflected in the balance sheet at December 31, 2003, at their
current estimated fair values. Due to the ongoing negotiations regarding the
disposition of the retail operations and the uncertainty of the outcome, all
existing liabilities have been reflected at their stated values as of December
31, 2003. Prior year operations have been restated to conform with the 2003
presentation of discontinued operations.

     The Company incurred a net loss for the fiscal year ended December 31, 2003
of ($845,166) as compared to a net loss of ($479,378) for the fiscal year ended
December 31, 2002. The 2003 loss includes the recognition of loss on disposal of
discontinued operations of ($258,296), which is attributable to the value of
assets held at December 31, 2003 related to retail store operations. At December
31, 2003 we had a deficit net worth of $(1,105,584) and negative working capital
of ($1,133,584). These factors create substantial doubt about our ability to
continue as a going concern. These financial statements do not include any
adjustments relating to the recoverability and classification of recorded assets
or the amounts and classification of liabilities that might be necessary in the
event we cannot continue to exist.

     General and administrative expenses decreased by $285,149 or 58% from
$485,834 in 2002 to $200,685 in 2003. This decrease was principally due to a
$267,339 or 78% decrease in legal and accounting costs from $341,648 in 2002 to
$74,309 in 2003.

     Interest expense increased by $4,646 or 10% from $45,391 in 2002 to $51,328
in 2003. This increase was due to an increase in interest bearing debt.

     Income tax (benefit) of ($248,687) in 2002 reflects the tax benefits
utilized to offset the income tax effects of the extraordinary gain of $621,719.
There is no net income tax benefit or expense in 2003.

                                        6
<PAGE>

     The extraordinary gain in 2002 of $373,032, net of the income tax effect of
$248,687, was the result of a settlement of balances due our former primary
supplier at a discount to face value.

     The loss from discontinued operations decreased $235,015 or 41%, from a
loss of ($569,872) in 2002 to a loss of ($334,857) in 2003. This decrease is
principally due to the closing of seven retail locations. The Company's business
model of locating retail outlets outside of military bases resulted in the
closing of these outlets due to the high number of military personnel being
deployed for contingency operations in support of Middle East operations.

     Liquidity.

     As of December 31, 2003, the Company had $22,615 in cash and a working
capital deficit of ($1,113,584). As of March 31, 2004 the company has exhausted
substantially all of its available cash.

















                                        7
<PAGE>

Item 7. Financial Statements.
-----------------------------

     Independent Auditors' Report

     Balance Sheet as of December 31, 2003

     Statements of Operations for the Years ended December 31, 2003 and 2002

     Statements of Stockholders' Equity (Deficit) for the years ended December
     31, 2003 and 2002

     Statements of Cash Flows for the years ended December 31, 2003 and 2002

     Notes to Financial Statements
















                                        8
<PAGE>





                          Independent Auditors' Report
                          ----------------------------




To the Board of Directors and Stockholders of
Cole Computer Corporation
Oklahoma City, Oklahoma


We have audited the accompanying balance sheet of Cole Computer Corporation as
of December 31, 2003, and the related statements of operations, stockholders'
equity (deficit) and cash flows for the years ended December 31, 2003 and 2002.
These financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements based
on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Cole Computer Corporation as of
December 31, 2003, and the results of its operations and its cash flows for the
years then ended December 31, 2003 and 2002, respectively in conformity with
accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that Cole
Computer Corporation will continue as a going concern. As discussed in Notes 1
and 2 to the financial statements, under existing circumstances, there is
substantial doubt about the ability of Cole Computer Corporation to continue as
a going concern at December 31, 2003. Management's plans in regard to that
matter also are described in Notes 1 and 2. The financial statements do not
include any adjustments that might result from the outcome of this uncertainty.


/s/ Hogan & Slovacek
--------------------
Hogan & Slovacek

Oklahoma City, Oklahoma
April 13, 2004

                                        9
<PAGE>

                            COLE COMPUTER CORPORATION
                                  BALANCE SHEET
                                December 31, 2003


Current Assets:
        Cash                                                             22,615
        AR - Other                                                        5,596
        Prepaid Expenses                                                 27,250
                                                                     ----------

              Total Current Assets                                       55,461

Fixed Assets, net                                                        28,000
                                                                     ----------

Total Assets                                                             83,461
                                                                     ==========

Current Liabilities:
        Notes Payable                                                   972,125
        Accounts Payable - Other                                          9,543
        Accounts Payable - Trade                                        123,280
        Accrued Expenses                                                 84,097
                                                                     ----------

              Total Current Liabilities                               1,189,045
                                                                     ----------


Commitments and contingencies

Stockholders' Equity (Deficit):
        10% cumulative preferred stock, $100 par
              value, 10,000,000 shares authorized,
              0 shares issued and outstanding                              --

        Preferred stock, no par value, 10,000,000
              shares authorized, 0 shares issued and
              outstanding                                                  --

        Common stock, $.001 par value, 80,000,000
              shares authorized, 19,387,400
              shares issued and outstanding                              19,387
        Paid in capital                                               2,828,321
        Deficit                                                      (3,949,292)
        Less: treasury stock, 4,000,000 shares at cost                   (4,000)
                                                                     ----------
Total Stockholder's Equity (Deficit)                                 (1,105,584)
                                                                     ----------

Total Liabilities & Stockholders' Equity (Deficit)                       83,461
                                                                     ==========


                                       10
<PAGE>
<TABLE>
<CAPTION>

                            COLE COMPUTER CORPORATION
                            STATEMENTS OF OPERATIONS
                  For the Year Ended December 31, 2003 and 2002

                                                            2003            2002
                                                       ------------    ------------
<S>                                                    <C>             <C>
Costs & Expenses:
       General and Administrative Expenses             $    200,685    $    485,834
       Interest Expense                                      51,328          45,391
                                                       ------------    ------------

            Total Expenses                                  252,013         531,225
                                                       ------------    ------------

Net (loss) before income tax expense,
       discontinued operations, and
       extraordinary items                                 (252,013)       (531,225)
                                                       ------------    ------------

Income tax expense (benefit):
       Income tax expense                                      --              --
       Income tax (benefit)                                    --          (248,687)
                                                       ------------    ------------

Net (loss) before discontinued operations and
       extraordinary item                                  (252,013)       (282,538)
                                                       ------------    ------------

Loss from discontinued operations                           334,857         569,872
Loss on disposal of discontinued operations                 258,296            --
                                                       ------------    ------------

Extraordinary item - gain on extinguishment
       of debt, net of income tax effect of $248,687           --          (373,032)


Net (Loss)                                             $   (845,166)   $   (479,378)
                                                       ============    ============

Earnings per share:
       Basic and diluted (loss) before
         extraordinary item                            $       (.04)   $       (.05)
       Extraordinary item                                      --               .02
                                                       ------------    ------------

       Basic and diluted (loss)                        $       (.04)   $       (.03)
                                                       ============    ============

        Weighted average shares outstanding              19,387,400      16,949,181
                                                       ============    ============


                                       11
<PAGE>

                                   COLE COMPUTER CORPORATION
                                   Statements of Cash Flows
                       For the Years Ended December 31, 2003 and 2002



                                                                          2003          2002
                                                                        ---------    ---------
Cash Flows from Operating Activities:
      Net loss                                                          $(845,166)   $(479,378)
      Adjustments to reconcile net loss to net
      cash used in operating activities:
           Stock issued for compensation, services, and expenses             --        210,750
           Depreciation                                                    86,954       94,783
           Trade payable converted to note payable                           --        136,759
           Provision for bad debts                                           --         75,615
           Equipment impairment/gain/losss on asset disposition            16,171       12,206
           Non-cash compensation expense related to stock option plan        --         11,015
           Gain on extinguishment of debt                                    --       (621,719)
           Loss on disposal of discontinued operations                    258,296         --
      Change in cash from operating assets and liabilities:
           Accounts receivable                                             97,290      190,736
           Inventory                                                      301,748      313,950
           Other current assets                                           (12,184)     (28,243)
           Accounts payable                                              (293,471)    (804,343)
           Accrued expenses                                               (68,445)      47,223
                                                                        ---------    ---------

  Net cash provided by (used in) operating activities                    (458,807)    (840,646)
                                                                        ---------    ---------

Cash Flows from Investing Activities:
      Purchase of Equipment                                               (21,053)     (48,013)
      Proceeds from sale of equipment                                       6,167         --
      Payment for deposits                                                   (400)        --
                                                                        ---------    ---------

Net cash used in investing activities                                     (15,286)     (48,013)
                                                                        ---------    ---------

Cash Flows from Financing Activities:
      Stock issued for cash                                                  --        250,000
      Loan proceeds                                                       414,516      651,172
      Principal payments on notes and capital leases payable              (64,024)    (330,401)
                                                                        ---------    ---------

Net cash provided by financing activities                                 350,492      570,771
                                                                        ---------    ---------

Net change in cash                                                       (123,601)    (317,888)

CASH, beginning of year                                                   146,218      464,106
                                                                        ---------    ---------

CASH, end of year                                                       $  22,617    $ 146,218
                                                                        =========    =========

                        See accompanying notes to financial statements

Supplemental Disclosures of Cash Flow Information:
      Interest paid                                                     $  45,299    $  50,394
      Income taxes paid                                                 $    --      $    --

Supplemental Disclosures of Non-cash Investing and Financing Activities:

     During the year ended December 31, 2003, the Company had the following non-cash
transactions:

          Accounts payable to an affiliate totaling $414,516 was converted to a long-term note
          payable.

          Equipment valued at $33,000 was acquired in a capital lease transaction, involving an
          exchange of equipment.

     During the year ended December 31, 2002, the Company had the following non-cash
transactions:

          Accounts payable totaling $136,759 was converted to a note payable

          In a series of transactions, 1,425,000 shares of the Company's common stock were
          issued for services, compensation, and expenses. These shares were valued at $210,750
          for financial reporting purposes.

          The Company entered into a settlement agreement with a supplier in which $959,990 in
          notes and accounts payable were settled for a cash payment of $338,271. This resulted
          in a non-cash gain of $621,719 before income tax effect

          The Company issued options under a non-statutory stock option plan in 2002. The
          compensation value assigned to these options was $11,015

                                              12
<PAGE>

                                                 COLE COMPUTER CORPORATION
                                        STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
                                       For the Years Ended December 31, 2003 and 2002


                                                                                                      Retained
                                   Common Stock               Treasury Stock             Paid in      Earnings
                               Shares        Amount        Shares         Amount         Capital      (Deficit)       Totals
                             -----------   -----------   -----------    -----------    -----------   -----------    -----------

Balance,
December 31, 2001             15,962,400        15,962    (4,000,000)        (4,000)     2,359,981    (2,624,748)      (252,805)

Shares issued for services        25,000            25          --             --            7,225          --            7,250

Shares issued for
compensation                      50,000            50          --             --           14,450          --           14,500

Shares sold for cash
September 2002                 2,000,000         2,000          --             --          248,000          --          250,000

Shares issued for
compensation                   1,000,000         1,000          --             --          139,000          --          140,000

Shares issued for expenses
    - as adjusted                350,000           350          --             --           48,650          --           49,000

Cost assigned to options
issued under non-statutory
stock option plan                   --            --            --             --           11,015          --           11,015

Net (loss)                          --            --            --             --             --        (479,378)      (479,378)
                             -----------   -----------   -----------    -----------    -----------   -----------    -----------

Balance,
December 31, 2002             19,387,400   $    19,387    (4,000,000)   $    (4,000)   $ 2,828,321   $(3,104,126)   $  (260,418)

Net (loss)                          --            --            --             --      $      --     $  (845,166)      (845,166)
                             -----------   -----------   -----------    -----------    -----------   -----------    -----------

Balance,
December 31, 2003             19,387,400   $    19,387    (4,000,000)   $    (4,000)   $ 2,828,321   $(3,949,292)   $(1,105,584)
                             ===========   ===========   ===========    ===========    ===========   ===========    ===========


                                       See accompanying notes to financial statements.

                                                            13
</TABLE>
<PAGE>

                            COLE COMPUTER CORPORATION
                            -------------------------
                          Notes to Financial Statements
                          -----------------------------
                           December 31, 2003 and 2002
                           --------------------------


NOTE 1 - SUMMARY OF CRITICAL ACCOUNTING POLICIES

Nature of Business
------------------

Electronic Service Co., Inc. ("ESCI") was formed in November 1991 as an Oklahoma
corporation for the purpose of acquiring and operating an electronics repair
business. In 1996, the Company adopted the dba Computer Masters and changed its
business to personal computer "clone" hardware assembly, sales, and repair,
utilizing both Intel and AMD microprocessors. The Company changed its name to
Cole Computer Corporation (the Company) and its state of incorporation (Nevada)
incident to its reverse acquisition ("reorganization") in 1998. The operations
of ESCI have since been merged into the operations of Cole Computer Corporation.
The Company has five retail stores in Oklahoma and Arkansas, and, in addition to
its retail business, sells to area government agencies, school districts and
military installations.

On or about March 1, 2004 the Company's management decided to cease doing
business as a retail computer and sales operation. Accordingly, all activities
have been treated as discontinued operations. Agreements are currently being
prepared to dispose of its operations through the sale to another entity or
liquidation of the business. Further, agreements are currently being negotiated
to determine the future operations of the Company. At this time, no definitive
contracts have been completed to either dispose of the activities or change its
operations. All assets of the Company have been reflected in the balance sheet
at December 31, 2003, at their current estimated fair values. Due to the ongoing
negotiations regarding the disposition of retail operations and the uncertainty
of the outcome, all existing liabilities of the Company are reflected at their
stated values at December 31, 2003. Prior year operations have been restated to
conform with the 2003 presentation of discontinued operations.

Cash and Cash Equivalents
-------------------------

Cash and cash equivalents include highly liquid investments, which are readily
convertible into cash and have an original maturity of three months or less. The
financial statements as of December 31, 2003 and 2002 do not include any cash
equivalents.

Allowance for Doubtful Accounts
-------------------------------

An allowance for doubtful accounts is established through a provision for bad
debts when management believes collection of accounts receivable is doubtful.
Accounts are written-off against this allowance when all collection efforts by
the Company have been exhausted. The balance of the allowance at December 31,
2003, has been included in the loss on disposal of discontinued operations.

Accounts Receivable-Trade
--------------------------

Accounts receivable-trade includes trade accounts receivable generated through
the normal course of business through retail operations and cooperative
advertising funds earned by the Company from a major manufacturer of component
parts purchased by the Company. The Company earns cooperative advertising funds
based upon the volume of components purchased. The manufacturer provides this
program to its significant customers in return for using its name and logo on
various forms of the Company's advertising programs and efforts. In connection
with the decision to cease retail operations, net trade receivables of $47,289
have been recognized in the loss from discontinued operations.

                                       14
<PAGE>

Product Warranty Receivable
---------------------------

Products sold by the Company are warranted by the manufacturer, normally for a
period of one year from date of purchase. The Company facilitates fulfillment of
the manufacturer's warranty by providing its customers with a replacement
product from Company inventory. The Company's inventory is replenished upon
receipt of the replacement product from the manufacturer. In connection with the
decision to cease retail operations, product warranty receivable of $16,885 has
been recognized in the loss from discontinued operations.

Inventory
---------

Inventories include component parts, sub-assemblies and merchandise held for
sale, and are valued at the lower of cost or market, using the first-in,
first-out method. Obsolete inventory is written down to liquidation value as
needed. Virtually all inventory on hand is component parts, as completed
computers are sold as they are built. In connection with the decision to cease
retail operations, inventory of $58,891 has been recognized in the loss from
discontinued operations.

Property and Equipment
----------------------

Property and equipment is carried at cost and consists of vehicles, furniture
and fixtures, computers used for inventory control, and retail point-of-sale
terminals. The Company reviews property and equipment for impairment whenever
events or changes in circumstances indicate the carrying value of an asset may
not be fully recoverable. Depreciation is determined using the straight-line
method based over their estimated useful lives of five years. In connection with
the decision to cease retail operations, property and equipment with an
amortized cost of $102,622 has been recognized in the loss from discontinued
operations. Equipment with a net book value of $28,000, which approximates fair
value, is included in the accompanying financial statements. This equipment will
be disposed of subsequent to December 31, 2003.

Earnings Per Common Share
-------------------------

Earnings (loss) per common share is computed by dividing the net income (loss)
by the weighted average number of common shares outstanding.

Diluted earnings per common share is computed by dividing the net income by the
weighted average number of common shares outstanding, plus potential dilutive
securities. For the years ended December 31, 2003 and 2002, the effect of
potential dilutive securities was insignificant.

Revenue Recognition
-------------------

The Company recognizes revenue when persuasive evidence of an arrangement
exists, delivery has occurred, the sales price is fixed and determinable and
collectibility is probable. Generally, these criteria are met at the time the
product is purchased by and delivered to the customer.

                                       15
<PAGE>

Estimates
---------

In preparing financial statements, management makes estimates and assumptions
that affect the reported amounts of assets in the balance sheet and revenue and
expenses in the income statement. Actual results could materially differ from
those estimates.

Fair Value of Financial Instruments
-----------------------------------

The Company estimates that the fair value of all financial instruments at
December 31, 2003, does not differ materially from the aggregate carrying values
of its financial instruments.

NOTE 2 - GOING CONCERN

As indicated above, the Company is no longer in business nor has it determined
what its future activities will be. It is not known at this time whether the
Company will continue as a going concern since new management has not as yet
taken over the operations of the Company. No commitments have been made to
continue the Company as a business entity and accordingly, there is substantial
doubt that the Company will continue as a going concern.

NOTE 3 - PRODUCT FINANCING ARRANGEMENT TRANSACTIONS

The Company had a product financing arrangement with a major supplier affiliated
with the Company whereby inventory purchased from other third party vendors was
then sold to the major supplier. The Company, at its discretion, repurchased
inventory from the major supplier for sale to its own customers. The Company was
under no contractual obligation to repurchase all inventories sold to the major
supplier. The Company specifically identified and segregated these transactions
in the general ledger for accounting purposes.

In accordance with Statement on Financial Accounting Standards No. 49, "Product
Financing Arrangements" (SFAS 49), the Company eliminated the revenue and costs
of revenue related to these transactions from the statement of operations. For
the year ended December 31, 2002, $317,526 in revenues and costs of revenues,
were eliminated from the statement of operations.

During the quarter ended March 31, 2002, the warehousing agreement between a
subsidiary of this major vendor and Cole Computer expired, eliminating the
product financing arrangement relationship between the companies.

In January 2002, the Company borrowed $300,000 from the formerly affiliated
company and supplier. This unsecured note bears interest at a rate of 12% and is
payable in monthly installments of $4,000 for 24 months, with the remainder of
approximately $278,000 due and payable on December 24, 2004. This note was
settled in December, 2002, pursuant to the settlement agreement discussed in
Note 4.

In September 2002, the Company began purchasing inventory from another supplier
formerly affiliated with the Company as discussed in Note 4.

NOTE 4 - RELATED PARTY TRANSACTIONS

During the 4th quarter in 2000, the Company entered into an agreement with a
shareholder, major supplier and member of the Board of Directors, whereby the
shareholder would provide warehousing operations and obtain a $1 million line of
credit with a third party vendor. Under the agreement, the Company purchased
products from a third party vendor and sold those products to a subsidiary of
the shareholder at cost and then repurchased products at a 4% mark-up from
another subsidiary of the shareholder for resale. The Company had the option to
purchase the warehouse operations for $500,000 and $1,000,000 of common stock at
fair market value.

                                       16
<PAGE>

In the 3rd quarter of 2001, this shareholder and major supplier completed his
one year term of service on the Board of Directors and elected not to serve on
the Board for a further period. In January 2002 the subsidiary company from
which the Company repurchased products ceased operations in Oklahoma. The parent
company of this subsidiary (owned by the shareholder and major supplier) and the
Company executed a novation to the their existing agreement, whereby the
shareholder and major supplier's company assumed contractual responsibility for
warehousing and store operations previously provided by the subsidiary company.
Although the contractual responsibility of the shareholder and major supplier's
company was to provide warehousing and store operations, effective with this
novation, the Company assumed operational management of the warehouse and store
operations.

On December 9, 2002, the Company entered into a settlement agreement with this
supplier. Terms of this settlement called for the Company to pay $338,271 in
settlement of notes and accounts payable totaling $959,990 resulting in a gain
of $373,032 net of income tax effect of $248,687. The Company had purchases of
$2,098,976 during the fiscal year ended December 31, 2002 from this supplier.

During the quarter ended June 30, 2002, the Company borrowed $12,900 from a
director of the Company. This note bears interest at a rate of 12%, with
principal and interest due one year from the date of issuance. The interest rate
on this note has been adjusted to 5.25%, effective January 1, 2003. Subsequent
to December 31, 2003, this note was converted to exercise stock options
available to this director, at the option price as stated in the stock option
plan.

Following his resignation effective August 30, 2002, the Company's former Chief
Executive Officer paid $110,000 for his right to receive one million shares of
Cole Computer Corporation restricted common stock at a price of $0.11 per share
in accordance with the Company's qualified executive stock option plan. These
options were immediately exercised by the former Chief Executive Officer. Also
following his resignation, 5,019,275 shares of the Company's restricted common
stock were placed in a voting trust proxied by the Company's Chairman of the
Board. The total shares held by the trust consist of 3,019,275 shares
contributed by the Company's former Chief Executive Officer and 2,000,000 shares
contributed by the Company's former Corporate Secretary and Director of the
Board. Subject to other provisions of the trust agreement, these shares will be
held by the trust for three and five years, depending on the terms of the
agreement.

In September 2002, the Company's Board of Directors approved the appointment and
employment agreement of a new Chief Executive Officer. As part of the employment
agreement, the newly appointed Chief Executive Officer was granted 1,000,000
shares of the Company's restricted common stock upon his acceptance of the terms
of the employment agreement. As a result, $140,000 of compensation expense has
been recognized in the Company's financial statements during the three and nine
months ended September 30, 2002. In addition, the new Chief Executive Officer
paid $140,000 to acquire another 1,000,000 shares of restricted common stock at
a price of $0.14 per share. He also earned an additional 500,000 shares of
common stock based on the performance of the Company during the fourth quarter
of 2002. The Company had recorded a liability of $22,500 at December 31, 2002 in
connection with its obligation to issue this additional 500,000 shares of common
stock. However, under the provisions of the Resignation and Restructuring
Agreement described below, the Chief Executive Officer released and forfeited
any and all stock options held by him. As a result, the accrual for this item
was reversed in the financial statements for the quarter ended September 30,
2003.

                                       17
<PAGE>

Effective August 22, 2003, the Company entered into a Resignation and
Restructuring Agreement ("Agreement") with the then Chief Executive Officer
("CEO") and the entity controlled by the CEO, which had served as the major
supplier of the Company. Under the Agreement, the CEO resigned from the Company,
and the Subcontractor Agreement between the Company and the major supplier was
terminated. In conjunction with the Agreement, the existing promissory note of
$338,272 issued from the Company to the CEO was replaced by a new promissory
note due February 1, 2005, with an interest rate of 8%, with interest payable
monthly beginning September 1, 2003. Also, trade accounts payable owed by the
Company in the amount of $414,516 to the major supplier was converted into a
promissory note due February 1, 2005, with an interest rate of 7%, with interest
payable monthly beginning February 1, 2004. Security agreements were executed in
connection with these notes, giving the holders an equal pledge of collateral in
all accounts receivable, inventory, and equipment, but subordinated to the lien
previously granted to the financial institution which holds the promissory note
for a line of credit.

On August 31, 2002, the Company's Board of Directors authorized the issuance of
1,500,000 shares of restricted common stock, which is being held in escrow, to
the Chairman of the Board as reimbursement for various expenses and costs
associated with the Chairman's responsibilities to tend to certain business
issues of the Company. As a result of this transaction, $210,000 of general and
administrative expenses were recognized in the Company's financial statements
during the three and nine months ended September 30, 2002. Subsequent to
September 30, 2002, the amount of shares authorized for issuance was adjusted to
350,000. Accordingly, the expense recognized as of September 30, 2002, was
adjusted to $49,000 as of December 31, 2002.

In October 2002, the Company entered into an agreement with a company owned and
controlled by a shareholder/officer. The agreement stipulates that this
affiliate will provide inventory to the Company's various retail operations on a
just-in-time basis, and perform other administrative duties related to
inventory. In accordance with this agreement, this affiliate also agreed to
provide the Company with a credit line of $250,000 for inventory purchases. In
exchange for these duties, the Company has agreed to pay 4% over the affiliate's
cost of inventory on all purchases. This agreement will continue until cancelled
by either party by 90 days written notice. Purchases of inventory from this
affiliate during the years ended December 31, 2003 and 2002 totaled
approximately $2,103,988 and $1,335,406, respectively.

In December 2002, in connection with the settlement transaction discussed above,
a shareholder/officer of the Company loaned the Company $338,272 (see Note 5),
the proceeds of which were used in connection with the settlement of the
agreement between the Company and its former major supplier.

                                       18
<PAGE>

NOTE 5 - NOTES PAYABLE

Notes payable and capital lease obligations consists of the following at
December 31, 2003:

        Note payable to a bank, due on demand with
        interest payable monthly based upon a variable
        rate established by the Lender (based upon prime
        rate), collateralized by accounts receivable,
        equipment and inventory                               $  90,000

        Note payable to a director of the Company,
        bearing interest at 12%  with principal and
        interest due one year from the date of issuance.
        Subsequent to December 31, 2003, this note was
        converted to exercise stock options under the
        Company's stock option plan                              12,900

        Capitalized equipment lease, due in monthly
        installments of $1,090 including interest at
        30%, maturing September 2008, and collateralized
        by equipment                                             32,188

        Note payable to a corporation, due in
        weekly installments of $1,250 including interest
        at 12%, with remaining principal and
        interest due December 31, 2004                           84,249

          Note payable to affiliate, principal and
        interest due February 1, 2005, bearing
        interest at 7%                                          414,516

        Note payable to affiliate, principal and
        interest due February 1, 2005, bearing
        interest at 8%                                          338,272
                                                              ---------

                                                              $ 972,125
                                                              =========


For reasons discussed in Note 2, the Company has not met its payment
requirements regarding certain notes payable. Additionally, the Company does not
have assets needed to produce future cash flows necessary to meet these
obligations. As such, all debt of the Company has been reflected as current
liabilities in the accompanying balance sheet.


NOTE 6 - INCOME TAXES

A reconciliation of the statutory federal income tax amount to the recorded
expense is as follows:

                                                          2003           2002
                                                       ---------      ---------

Computed at the expected statutory rate                $       0      $       0

Utiltization of net operating loss                             0       (248,687)
                                                       ---------      ---------
Taxes (benefit) on net income before
  extraordinary income                                         0       (248,687)

Tax effect of extraordinary gain                               0        248,687
                                                       ---------      ---------

Taxes (benefits) on net income                         $       0      $       0
                                                       =========      =========


                                       19
<PAGE>

As of December 31, 2003, the Company had a net operating loss carry forward of
approximately $3,156,000, which begins to expire in 2018. Utilization of this
deferred tax asset is dependent on future taxable profits, and as such, this
amount is considered fully reserved. Additionally, the impact of discontinued
operations and events subsequent could limit the Company's ability to fully
realize the benefits of the net operating loss carry forward.

NOTE 7 - STOCK OPTIONS
The Company established a stock option plan effective September 1, 2001, which
allows current (and certain former) employees, officers and directors of the
Company to acquire shares of the Company's authorized common stock. The plan
offers participants an option to purchase shares of Company common stock at a
fixed price of $.11 per share for a period of five years from the inception of
the plan. The number of shares available to each individual is determined by the
length of service to and position with the Company, including service with the
Company's predecessor company, ESCI, up to the date of the plan. The Board of
Directors, upon giving 90 days notice, reserves the right to modify or
discontinue the plan based upon business necessity. As of December 31, 2003,
approximately 728,250 options were outstanding under this plan. In connection
with the granting of these options, $-0- and $11,015 of expense was recognized
in 2003 and 2002, respectively.

The Company applies APB 25 and related interpretations in accounting for its
plan. Compensation for services that a corporation receives under APB 25 through
stock-based compensation plans should be measured by the quoted market price of
the stock at the measurement date less the amount, if any, that the individual
is required to pay. If the Company had elected to recognize compensation based
on the fair value of the options granted at the grant date as prescribed by
"Statement of Financial Accounting Standards No. 123 ("SFAS 123") Accounting for
Stock-Based Compensation", the impact on net earnings and net earnings per share
would not have differed materially from the application of APB 25.


                                       20
<PAGE>

The fair value of each option grant is estimated on the date of the grant using
the Black-Scholes option pricing model with the following assumptions used for
grants: weighted average risk free interest rate of 3.74%; no dividend yield;
volatility of 60%; and expected life of five years. The fair values of the
options were based on the difference between the present value of the exercise
price of the option and the estimated fair value price of the common share.

The intent of the Black-Scholes option valuation model is to provide estimates
of fair values of traded options that have no vesting restrictions and are fully
transferable. Option valuation models require the use of highly subjective
assumptions including expected stock price volatility. The Company has utilized
the Black-Scholes method to produce the pro forma disclosures required under
SFAS 123. In management's opinion, existing valuation models do not necessarily
provide a reliable single measure of the fair value of its employee stock
options because the Company's employee stock options have significantly
different characteristics from those of traded options and because changes in
the subjective input assumptions can materially affect the fair value estimate.
The effects of applying SFAS 123 in the pro forma are not indicative of future
amounts.

NOTE 8 - OPERATING LEASES

The Company has 5 retail stores and one corporate office. Leases on these spaces
vary in cost and term. Rent expense for 2003 and 2002 was $163,546 and $222,850,
respectively. Net minimum lease payments due are as follows:

               Year           Amount
               ----           ------
               2004          $ 55,929
               2005            40,817
               2006            40,367
               2007            34,754
               2008              -
               Thereafter        -
                             --------

               Total         $172,867
                             ========

The impact of discontinued operations on these future commitments has not been
determined.

                                       21
<PAGE>

Item 8. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure.

     None.

Item 8A. Controls and Procedures

     Our Chief Executive Officer and Chief Financial Officer are responsible for
establishing and maintaining internal controls and have designed these controls
to ensure that material information, financial or otherwise, relating to
accounting and financial reporting of our operations and activities, including
those of our consolidated subsidiary, were made known to them in their
capacities as executive officers, particularly during the period that this
report was prepared. These executive officers have evaluated the effectiveness
of our internal controls within the preceding 90 days of this Report, having
concluded that our internal controls were fully effective as of the date of this
report, and there were no significant deficiencies or material weaknesses
discovered. and have reported this conclusion to our auditors. In conducting
their evaluation of our internal controls, these executive officers did not
discover any fraud that involved management or other employees who have a
significant role in our internal controls. Furthermore, there were no
significant changes in our internal controls or in other factors that could
significantly affect our internal controls subsequent to the date of their
evaluation. Because no significant deficiencies or material weaknesses were
discovered, there were no necessary corrective actions taken to correct
significant deficiencies and material weaknesses in our internal controls.


                                    PART III

Item 9. Directors, Executive Officers, Promoters and Control Persons; Compliance
with Section 16(a) of the Exchange Act.

Directors and Executive Officers.

     The following table sets forth the names of all current directors and
executive officers of the Company. These persons will serve until the next
annual meeting of stockholders (held in July of each year) or until their
successors are elected or appointed and qualified, or their prior resignation or
termination.

                                       Director/
                                        Officer
            Name               Age       Since            Position
            ----               ---     ---------          --------

    Dr. S. F. Hartley          58        12/98     Chairman of the Board

    John L. Ruth               50         4/99     Director and President

    Dr. Kendrick J. Dennis     47         1/03     Director

    Albert Fields              54         1/03     Director

    Franklin Tabor             57         1/03     Director

    Lyndel Lackey              44        11/02     Chief Financial Officer



                                       22
<PAGE>

Business Experience.

     John L. Ruth. Mr. Ruth is 50 years of age and is the President and a
Director of the Company. In April 1999, Lt. Col. John L. Ruth joined the
Company. Mr. Ruth had a decorated, 22 year career in the United States Air Force
with his with his last assignment as the Director of Logistics, 72nd Air Base
Wing at Tinker AFB in Oklahoma. Lt. Col. Ruth had direct responsibility for the
$7 billion supply and equipment accounts at Tinker AFB and held management
responsibility for the $200 million annual General Support Division stock fund
budget. He had direct oversight of over 500 Tinker AFB civilian and military
personnel. Lt. Col. Ruth received numerous commendations, decorations and awards
including the Meritorious Service Medal with two oak leaf clusters and the Air
Force Commendation Medal with two oak leaf clusters. He is a graduate of the Air
Command and Staff College. Lt. Col. Ruth earned a Masters degree in Human
Relations/Organizational Behavior from the University of Phoenix, Salt Lake
City, Utah and a Bachelor's degree in Business Administration/Marketing from
Florida State University. Lt. Col. Ruth is married, the father of one daughter
and is a well-respected community and church leader.

     Lyndel Lackey. Mr. Lackey is 44 years of age and is the Company's Chief
Financial Officer. Mr. Lackey began this position in November 2002. Mr. Lackey
has over 20 years of accounting experience. He served as controller for a
wholesale electronics distributor, as well as serving for various public
accounting firms in the tax, audit, and management services departments. Mr.
Lackey earned a Bachelor of Arts Degree in accounting from Southern Nazarene
University and is a certified public accountant. He is married and has three
children.

     S.F. Hartley, D.P.M. Dr. Hartley is 58 years of age and is the Chairman of
the Board of Directors and a Director of the Company. He is a well respected
podiatrist in Houston, Texas, owns five (5) podiatry clinics and is a co-owner
of three (3) surgery centers in the greater Houston area. In addition, Dr.
Hartley is a shareholder and Board of Director member of a national company that
owns seventy-two (72) podiatry clinics across the U.S. Dr. Hartley is on staff
at several hospitals and also serves as the National Representative for the
State of Texas on the National Podiatry Board. Dr. Hartley is also a Board of
Director member for several commercial banking institutions.

     Albert D. Fields. Mr. Fields is 54 years old and a Director. Mr Fields is a
seasoned financial management professional with over thirty years of proven
performance in institutions ranging from a 25 million dollar single-branch
operation to a 350 million dollar multiple-branch company. Mr. Fields is
currently the Executive Vice President ofBanking Center Management at the
American National Bank, Terrell, Texas. Other positions include Senior Vice
President and Area Executive, South Trust Bank, Houston Texas and President,
Bayshore National Bank, La Porte, Texas. Mr. Fields earned a Bachelor's degree
in Business Administration from Southwest State University and is a graduate
from the School of Banking of the South, Louisiana State University, National
Commercial Lending School, University of Oklahoma, and the Institute of
Certified Bankers. He is also active in his community by serving as officers in
the Chamber of Commerce, Water Authority, Optimist Club, and Rotary.

     Kenrick J. Dennis, DPM. Dr. Dennis is 47 years old and a Director and
serves as the Corporate Secretary. Dr Dennis has a successful podiatric practice
in Houston, Texas. He brings a wealth of experience as corporate secretary
having served on the Executive Committee of several major organizations. Dr
Dennis earned a graduate degree from the California College of Podiatric
Medicine, a bachelor's degree from the University of Texas. He completed his
residency training at the University of Texas Health Science Center in San
Antonio. He is a published author in his field and has earned several national
awards in his profession. He is active in his community serving in many local
professional organizations. He is married and has two children.

     Franklin R. Tabor. Mr. Tabor is 57 years old and is a Director. Mr. Tabor
is a licensed Real Estate Broker of 15 years. In addition, Mr. Tabor is a
certified college level educator at Metro Community College and a certified Real
Estate instructor in Nebraska. He earned a Masters degree in Education from the
University of Northern Colorado and a Bachelor of Science degree in Business
Administration from Bowling Green State University. He has served on several
boards including a bank holding company and a neighborhood association. He was
partner/operator of Motorcycle Plaza, Inc, a multi-line and multi-store
franchised motorcycle and accessories dealer. He is married and has three
children.

                                       23
<PAGE>

Section 16(a) Beneficial Ownership Reporting Compliance.

     To the knowledge of management, required reports under Section 16(a) of the
1934 Act have been timely filed by the directors, executive officers and
"affiliates" of the Company.

Item 10. Executive Compensation.

     The following table sets forth the compensation paid or accrued to the
persons serving as Chief Executive Officer during the year ended December 31,
2003. There were no other executive officers whose total annual salary and bonus
exceeded $100,000 for services performed in December 31, 2003, 2002 or 2001.

     The following table sets forth the aggregate compensation paid by the
Company to its chief executive officer for services rendered during the periods
indicated:

Summary Compensation Table
<TABLE>
<CAPTION>
                                                                       Long Term Compen-
                                                                            sation
                                            Annual Compensation             Awards
                                  -------------------------------------  -----------
                                                               Other                   All Other
                                                              Annual                    Compen-
       Name and           Fiscal                              Compen-      Options      sation
  Principal Position       Year   Salary ($)(1)    Bonus($)   sation(2)      (#)          ($)
  ------------------       ----   -------------    --------   ---------      ---          ---
<S>                        <C>       <C>             <C>        <C>       <C>             <C>

Dyon Tang                  2003      $ 9,615         -0-         -            -            -
 former Chief  Executive
 Officer

Dyon Tang                  2002      $13,462         -0-         -       1,500,000 (3)     -
 former Chief Executive
 Officer

-------------------
</TABLE>
     (1)  Mr. Tang began his employment in September 2002. The salary amounts
          for 2002 reflect three months of compensation.

     (2)  The Company provides various perquisites to certain employees
          including the named executive officers. In each case, the aggregate
          value of the perquisites provided to the named executive officers did
          not exceed the lesser of $50,000 or 10% of such named executive
          officers' annual salary and bonus.

     (3)  These options were granted to Mr. Tang under his employment agreement.
          See "Employment Contracts" below.

                                       24
<PAGE>

Compensation of Directors.

     In accordance with the stock option plan discussed in Note 8 to the
financial statements, all Directors of the Company receive for serving on the
Board of Directors of the Company, options to purchase 6,250 shares of the
Company per quarter, providing the Director is present at the Shareholders
Meeting and available throughout the quarter, plus any actual expenses incurred.

Employment Contracts.

     In September 2002, the Company's Board of Directors approved the
appointment and employment agreement of Dyon Tang as Chief Executive Officer. As
part of the employment agreement, the newly appointed Chief Executive Officer
was granted 1,000,000 shares of the Company's restricted common stock upon his
acceptance of the terms of the employment agreement. As a result, $140,000 of
compensation expense was been recognized in the Company's financial statements
during the year ended December 31, 2002. He also earned an additional 500,000
shares of common stock based on the performance of the Company during the fourth
quarter of 2002. The contract also allows for the issuance of up to an
additional 3,500,000 shares of the Company's stock over the period of the
contract based on the Company's future performance. Mr. Tang will earn 200,000
shares for each profitable calendar quarter plus one share for each dollar of
net income for the quarter.

     The Company has entered into Employment Agreements with John Ruth and
Lyndel Lackey. The Employment Agreements prohibit the executive from engaging in
or advising, either directly or indirectly, any business which is substantially
competitive with any business then actively conducted. The Employment Agreements
provide that the Company will have the right to terminate any executive's
employment, and that any executive will have the right at any time to terminate
his employment with the Company under the Employment Agreements. Any amounts
that the Company will provide an executive in the event of termination by the
Company other than for cause (as defined in the Employment Agreements) or by the
executive for good reason (as defined in the Employment Agreements) do not
exceed $100,000.

Termination of Employment and Change of Control Arrangements.

     Except as indicated above, there are no employment contracts, compensatory
plans or arrangements, including payments to be received from the Company, with
respect to any director or executive officer of the Company which would in any
way result in payments to any such person because of his or her resignation,
retirement or other termination of employment with the Company or its
subsidiaries, any change in control of the Company, or a change in the person's
responsibilities following a change in control of the Company.



                                       25
<PAGE>

Item 11. Security Ownership of Certain Beneficial Owners and Management and
Related Stockholder Matters.

     The following table sets forth certain information regarding the beneficial
ownership of the Company's Common Stock as of April 1, 2004, by (i) each
director of the Company, (ii) each named executive officer in the Summary
Compensation Table, (iii) each person known or believed by the Company to own
beneficially five percent or more of the Common Stock and (iv) all directors and
executive officers as a group. Unless indicated otherwise, each person has sole
voting and dispositive power with respect to such shares.


     Name of Director, Executive Officer        Beneficial Ownership(1)
     or Shareholders Holding 5% or More,    Number of Shares(3)    Percent
     -----------------------------------    -------------------    -------

     Homer O & Cynthia A. Cole (2)
     937 S.W. 54th
     Oklahoma City, OK  73109                    4,219,275          27.33

     Dr. S.F. Hartley
     2201 Juanita Lane
     Deer Park, TX  77536                        6,183,025          39.59

     Dyon Tang
     2020 North 72nd
     Omaha, NE 68134                             2,000,000          12.96

     John L. Ruth
     6201 S E 56th Street
     Oklahoma City, OK  73130                      615,200           3.89

     Albert Fields
     603 Sandylane
     Laporte  TX  77571                             66,250            *

     Franklin Tabor
     231 S. 96th Street
     Omaha, NE 68114                                56,250            *

     Kenrick Dennis
     11838 Durrette
     Houston, TX 77024                              61,250            *

     Lyndel Lackey
     7001 Basswood Canyon Road
     Oklahoma City, OK  73162                       18,750            *

     All directors and named executive
       officers as a group (6 persons)           9,000,725          43.26

-----------------------

*    Less than one percent.

     (1)  Shares of Common Stock that are not outstanding but that can be
          acquired by a person upon exercise of an option within 60 days are
          included in computing the percentage for such person, but are not
          included in computing the percentage for any other person. Disclosures
          regarding "beneficial ownership" are made as that term is defined
          under federal securities laws.

     (2)  Cynthia A. and Homer O. Cole are the registered owners of 4,219,275
          shares. These shares are held in a voting trust controlled by Dr. S.F.
          Hartley. All of these shares are considered to be beneficially owned
          by Homer O. and Cynthia A. Cole.

     (3)  Included in shares beneficially owned are outstanding stock options
          totaling 743,750 for the directors and named executive officers in
          total.

                                       26
<PAGE>

Compensation Pursuant to Plans.

     The following table shows information relating to compensation plans
approved by shareholders and not approved by shareholders as of the year ended
December 31, 2003.
<TABLE>
<CAPTION>

                                    Number of                                Number of
                                 securities to be                           securities
                                   issued upon       Weighted-average   remaining available
                                   exercise of      exercise price of   for future issuance
                                   outstanding         outstanding          under equity
                                options, warrants   options, warrants    compensation plans
                                   and rights           and rights               (1)
                                -----------------   -----------------   -------------------
<S>                                  <C>                  <C>                <C>
Equity compensation plans
approved by shareholders                 -                -                        -

Equity compensation plans
not approved by shareholders:
  Stock Option Plan                  728,250              .11                1,120,750
  Employment Agreement                     0              .00                        0
                                   ---------                                 ---------
  Total                              728,250                                 1,120,750
                                   =========                                 =========
</TABLE>


                                       27
<PAGE>

Item 12. Certain Relationships and Related Transactions.

Transactions with Management and Others.

In the 3rd quarter of 2001, this shareholder and major supplier completed his
one year term of service on the Board of Directors and elected not to serve on
the Board for a further period. In January 2002 the subsidiary company from
which the Company repurchased products ceased operations in Oklahoma. The parent
company of this subsidiary (owned by the shareholder and major supplier) and the
Company executed a novation to the their existing agreement, whereby the
shareholder and major supplier's company assumed contractual responsibility for
warehousing and store operations previously provided by the subsidiary company.
Although the contractual responsibility of the shareholder and major supplier's
company was to provide warehousing and store operations, effective with this
novation, the Company assumed operational management of the warehouse and store
operations.

On December 9, 2002, the Company entered into a settlement agreement with this
supplier. Terms of this settlement call for the Company to pay $338,271 in
settlement of notes and accounts payable totaling $959,990 resulting in a gain
of $373,032 net of income tax effect of $248,687. The Company had purchases of
$2,098,976 and $4,334,369 during the fiscal years ended December 31, 2002 and
2001 respectively from this supplier.

During the quarter ended June 30, 2002, the Company borrowed $12,900 from a
director of the Company. This note bears interest at a rate of 12%, with
principal and interest due one year from the date of issuance. The interest rate
on this note has been adjusted to 5.25%, effective January 1, 2003.

Following his resignation effective August 30, 2002, the Company's former Chief
Executive Officer paid $110,000 for his right to receive one million shares of
Cole Computer Corporation restricted common stock at a price of $0.11 per share
in accordance with the Company's qualified executive stock option plan. These
options were immediately exercised by the former Chief Executive Officer. Also
following his resignation, 5,019,275 shares of the Company's restricted common
stock were placed in a voting trust proxied by the Company's Chairman of the
Board. The total shares held by the trust consist of 3,019,275 shares
contributed by the Company's former Chief Executive Officer and 2,000,000 shares
contributed by the Company's former Corporate Secretary and Director of the
Board. Subject to other provisions of the trust agreement, these shares will be
held by the trust for three and five years, depending on the terms of the
agreement.

In September 2002, the Company's Board of Directors approved the appointment and
employment agreement of a new Chief Executive Officer. As part of the employment
agreement, the newly appointed Chief Exeutive Officer was granted 1,000,000
shares of the Company's restricted common stock upon his acceptance of the terms
of the employment agreement. As a result, $140,000 of compensation expense has
been recognized in the Company's financial statements during the three and nine
months ended September 30, 2002. In addition, the new Chief Executive Officer
paid $140,000 to acquire another 1,000,000 shares of restricted common stock at
a price of $0.14 per share. He also earned an additional 500,000 shares of
common stock based on the performance of the Company during the fourth quarter
of 2002. The Company has recorded a liability of $22,500 at December 31, 2002 in
connection with its obligation to issue this additional 500,000 shares of common
stock. The contract also allows for the issuance of up to an additional
3,500,000 shares of the Companies stock over the period of the contract based on
certain performance criteria.

                                       28
<PAGE>

On August 31, 2002, the Company's Board of Directors authorized the issuance of
1,500,000 shares of restricted common stock, which is being held in escrow, to
the Chairman of the Board as reimbursement for various expenses and costs
associated with the Chairman's responsibilities to tend to certain business
issues of the Company. As a result of this transaction, $210,000 of general and
administrative expenses were recognized in the Company's financial statements
during the three and nine months ended September 30, 2002. Subsequent to
September 30, 2002, the amount of shares authorized for issuance was adjusted to
350,000. Accordingly, the expense recognized as of September 30, 2002, was
adjusted to $49,000 as of December 31, 2002.

In October 2002, the Company entered into an agreement with a company owned and
controlled by a shareholder/officer. The agreement stipulates that this
affiliate will provide inventory to the Company's various retail operations on a
just-in-time basis, and perform other administrative duties related to
inventory. In accordance with this agreement, this affiliate also agreed to
provide the Company with a credit line of $250,000 for inventory purchases. In
exchange for these duties, the Company has agreed to pay 4% over the affiliates
cost of inventory on all purchases. This agreement will continue until cancelled
by either party by 90 days written notice. Purchases of inventory from this
affiliate during the year ended December 31, 2002 totaled approximately
$1,335,406. Additionally, the financial statements include accounts payable to
this affiliate of $291,644 at December 31, 2002.

In December 2002, in connection with the settlement transaction discussed above,
a shareholder/officer of the Company loaned the Company $338,272 (see Note 5),
the proceeds of which were used in connection with the settlement of the
agreement between the Company and its former major supplier.

Effective August 22, 2003, the Company entered into a Resignation and
Restructuring Agreement ("Agreement") with the then Chief Executive Officer
("CEO") and the entity controlled by the CEO, which had served as the major
supplier of the Company. Under the Agreement, the CEO resigned from the Company,
and the Subcontractor Agreement between the Company and the major supplier was
terminated. In conjunction with the Agreement, the existing promissory note of
$338,272 issued from the Company to the CEO was replaced by a new promissory
note due February 1, 2005, with an interest rate of 8%, with interest payable
monthly beginning September 1, 2003. Also, trade accounts payable owed by the
Company in the amount of $414,516 to the major supplier was converted into a
promissory note due February 1, 2005, with an interest rate of 7%, with interest
payable monthly beginning February 1, 2004. Security agreements were executed in
connection with these notes, giving the holders an equal pledge of collateral in
all accounts receivable, inventory, and equipment, but subordinated to the lien
previously granted to the financial institution which holds the promissory note
for a line of credit.

Transactions with Promoters.

     There have been no material transactions, series of similar transactions,
currently proposed transactions, or series of similar transactions, to which the
Company or any of its subsidiaries was or is to be a party, in which the amount
involved exceeds $60,000 and in which any promoter or founder, or any member of
the immediate family of any of the foregoing persons, had a material interest.



                                       29
<PAGE>

Item 13. Exhibits and Reports on Form 8-K.*

     Reports on Form 8-K

          No reports on Form 8-K were filed during the 4th quarter of 2003.


Item 14. Principal Accountant Fees and Services.

      Year    Audit Fees    Audit-Related Fees   Tax Fees    All Other Fees
      ----    ----------    ------------------   --------    --------------

      2002     $33,500             -0-            $2,500          -0-

      2003     $22,500             -0-            $2,500          -0-


Exhibits*

    31.1              Rule 13a-14(a) Certifications
    32.1              Section 1350 Certification




                                       30
<PAGE>


                                   SIGNATURES

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

                                    Cole Computer Corporation

April 14, 2004                      By: /s/ John L. Ruth
                                       John L. Ruth
                                       Chief Executive Officer

                                    By: /s/ Lyndel Lackey
                                       Chief Financial Officer

     In accordance with the Exchange Act, this report has been signed below by
the following persons on behalf of the registrant and in the capacities and on
the dates indicated.


       Name                        Title                              Date
       ----                        -----                              ----

/s/ S. F. Hartley       Chairman of the Board of Directors     April  14,  2004

/s/ John L. Ruth        President and a Director               April  14,  2004

/s/ Albert Field        Director                               April  14,  2004

/s/ Kenrick Dennis      Director                               April  14,  2004

/s/ Franklin Tabor      Director                               April  14,  2004





                                       31