----

----

| Delaware                                                       |   | 51-0102492                              |
|----------------------------------------------------------------|--------|-----------------------------------------|
| (State or other jurisdiction of incorporation or organization) |   | (I.R.S. Employer Identification Number) |
|                                                           |   |                                    |
| 4 Morris Street, Port Jefferson Station, NY                    |   | 11776                                   |
| (Address of principal executive offices)                       |   | (Zip Code)                              |

----

----

----

CANAL 

| Part I - Financial Information                                                                                                                    |   | 3      |
|---------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|
|                                                                                                                                              |   |   |
| Item I. Condensed Financial Statements:                                                                                                           |   |   |
|                                                                                                                                              |   |   |
| Consolidated Balance Sheets - July 31, 2010and October 31, 2009                                                                                   |   | 4      |
|                                                                                                                                              |   |   |
| Consolidated Statements of Operations and Comprehensive Income (Loss) for the Nine Month Periods ended July 31, 2010 and 2009                     |   | 6      |
|                                                                                                                                              |   |   |
| Consolidated Statements of Changes in Stockholders’ Equity for the One Year and Nine Month Periods ended October 31, 2009 and July 31, 2010 |   | 10     |
|                                                                                                                                              |   |   |
| Consolidated Statements of Cash Flows for the Nine Month Periods ended July 31, 2010 and 2009                                                     |   | 11     |
|                                                                                                                                              |   |   |
| Notes to Consolidated Financial Statements                                                                                                        |   | 13     |
|                                                                                                                                              |   |   |
| Item II. Management’s Discussion and Analysis of Financial Condition                                                                        |   | 28     |
|                                                                                                                                              |   |   |
| Liquidity and Capital Resources                                                                                                                   |   | 37     |
|                                                                                                                                              |   |   |
| Other Factors                                                                                                                                     |   | 39     |
|                                                                                                                                              |   |   |
| Item III. Quantitative and Qualitative Disclosures About Market Risk                                                                              |   | 39     |
|                                                                                                                                              |   |   |
| Item IV. Controls and Procedures                                                                                                                  |   | 40     |
|                                                                                                                                              |   |   |
| Part II Other Information                                                                                                                         |   | 41     |
|                                                                                                                                              |   |   |
| Items 1 through 6                                                                                                                                 |   | 42     |
|                                                                                                                                              |   |   |
| Signatures and Certifications                                                                                                                     |   | 43     |

----

Index

PART 

----

Index

CANAL 

|                                                                                                                                                |   | JULY 31,    |      |   | OCT. 31,    |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------|-----------|--------|-------------|--------|
|                                                                                                                                                |   | 2010        |      |   | 2009        |   |
|                                                                                                                                                |   | (UNAUDITED) |      |   | (UNAUDITED) |   |
| ASSETS:                                                                                                                                             |   |        |      |   |        |   |
|                                                                                                                                                |   |        |      |   |        |   |
| CURRENT ASSETS:                                                                                                                                     |   |        |      |   |        |   |
|                                                                                                                                                |   |        |      |   |        |   |
| CASH AND CASH EQUIVALENTS                                                                                                                           |   | $           | 2,405     |   |        | $      | 154,624 |   |
|                                                                                                                                                |   |        |      |   |        |   |   |   |
| NOTES AND ACCOUNTS RECEIVABLE, NET OF AN ALLOWANCE FOR DOUBTFUL ACCOUNTS OF $ZERO AT BOTH JULY 31, 2010 AND OCTOBER 31, 2009,                       |   |        | 237,172   |   |        |   | 72,702 |   |
|                                                                                                                                                |   |        |      |   |        |   |   |   |
| ART INVENTORY, NET OF A VALUATION ALLOWANCE OF $396,522 AT BOTH JULY 31, 2010 AND OCTOBER 31, 2009                                                  |   |        | 100,000   |   |        |   | 100,000 |   |
|                                                                                                                                                |   |        |      |   |        |   |   |   |
| STOCKYARDS INVENTORY                                                                                                                                |   |        | 4,857     |   |        |   | 16,586 |   |
|                                                                                                                                                |   |        |      |   |        |   |   |   |
| PREPAID EXPENSES                                                                                                                                    |   |        | 61,939    |   |        |   | 16,965 |   |
|                                                                                                                                                |   |        |      |   |        |   |   |   |
| TOTAL CURRENT ASSETS                                                                                                                                |   |        | 406,373   |   |        |   | 360,877 |   |
|                                                                                                                                                |   |        |      |   |        |   |   |   |
|                                                                                                                                                |   |        |      |   |        |   |   |   |
| NON-CURRENT ASSETS:                                                                                                                                 |   |        |      |   |        |   |   |   |
|                                                                                                                                                |   |        |      |   |        |   |   |   |
| PROPERTY ON OPERATING LEASES, NET OF ACCUMULATED DEPRECIATION OF $464,999 AND $455,749 AT JULY 31, 2010 AND OCTOBER 31, 2009, RESPECTIVELY          |   |        | 1,396,957 |   |        |   | 1,073,607 |   |
|                                                                                                                                                |   |        |      |   |        |   |   |   |
| PROPERTY USED IN STOCKYARD OPERATIONS, NET OF ACCUMULATED DEPRECIATION OF $188,489 AND $178,386 AT JULY 31, 2010 AND OCTOBER 31, 2009, RESPECTIVELY |   |        | 1,013,219 |   |        |   | 988,322 |   |
|                                                                                                                                                |   |        |      |   |        |   |   |   |
|                                                                                                                                                |   |        |      |   |        |   |   |   |
| OTHER ASSETS:                                                                                                                                       |   |        |      |   |        |   |   |   |
|                                                                                                                                                |   |        |      |   |        |   |   |   |
| PROPERTY HELD FOR DEVELOPMENT OR RESALE                                                                                                             |   |        | 272,525   |   |        |   | 272,525 |   |
| RESTRICTED CASH – LETTER OF CREDIT                                                                                                            |   |        | 140,000   |   |        |   | 130,000 |   |
| RESTRICTED CASH - TRANSIT INSURANCE                                                                                                                 |   |        | 37,225    |   |        |   | 30,690 |   |
| DEPOSITS AND OTHER ASSETS                                                                                                                           |   |        | 0         |   |        |   | 0 |   |
|                                                                                                                                                |   |        |      |   |        |   |   |   |
|                                                                                                                                                |   |        | 449,750   |   |        |   | 433,215 |   |
|                                                                                                                                                |   |        |      |   |        |   |   |   |
|                                                                                                                                                |   | $           | 3,266,299 |   |        | $      | 2,856,021 |   |

----

Index

|                                                                                                                                                                                                                                                 |   | JULY 31, 2010 |        |   | OCT.31, 2009 |     |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------|-------------|--------|--------------|----------|
|                                                                                                                                                                                                                                                 |   | (UNAUDITED)   |        |   | (UNAUDITED)  |     |
|                                                                                                                                                                                                                                                 |   |          |        |   |         |     |
| LIABILITIES & STOCKHOLDERS' EQUITY:                                                                                                                                                                                                              |   |          |        |   |         |     |
|                                                                                                                                                                                                                                                 |   |          |        |   |         |     |
| CURRENT LIABILITIES:                                                                                                                                                                                                                                 |   |          |        |   |         |     |
| ACCOUNTS PAYABLE AND ACCRUED EXPENSES                                                                                                                                                                                                                |   | $             | 307,553     |   |         | $        | 194,394 |   |
| SALARIES AND INTEREST PAYABLE - OFFICERS                                                                                                                                                                                                             |   |          | 337,875     |   |         |     | 0 |   |
| ACCRUED PROFESSIONAL FEES                                                                                                                                                                                                                            |   |          | 18,601      |   |         |     | 84,570 |   |
| PREFERRED STOCK DIVIDEND PAYABLE                                                                                                                                                                                                                     |   |          | 211,735     |   |         |     | 157,735 |   |
| INCOME TAXES PAYABLE                                                                                                                                                                                                                                 |   |          | 10,000      |   |         |     | 10,000 |   |
| TOTAL CURRENT LIABILITIES                                                                                                                                                                                                                            |   |          | 885,764     |   |         |     | 446,699 |   |
|                                                                                                                                                                                                                                                 |   |          |        |   |         |     |   |   |
|                                                                                                                                                                                                                                                 |   |          |        |   |         |     |   |   |
| NON-CURRENT LIABILITIES:                                                                                                                                                                                                                             |   |          |        |   |         |     |   |   |
| LONG-TERM PENSION LIABILITY                                                                                                                                                                                                                          |   |          | 782,132     |   |         |     | 796,672 |   |
| REAL ESTATE TAXES PAYABLE                                                                                                                                                                                                                            |   |          | 114,334     |   |         |     | 141,725 |   |
| TOTAL NON-CURRENT LIABILITIES                                                                                                                                                                                                                        |   |          | 896,466     |   |         |     | 938,397 |   |
|                                                                                                                                                                                                                                                 |   |          |        |   |         |     |   |   |
|                                                                                                                                                                                                                                                 |   |          |        |   |         |     |   |   |
| LONG-TERM DEBT, RELATED PARTY                                                                                                                                                                                                                        |   |          | 1,332,000   |   |         |     | 992,000 |   |
|                                                                                                                                                                                                                                                 |   |          |        |   |         |     |   |   |
| COMMITMENTS AND CONTINGENCIES                                                                                                                                                                                                                        |   |          |        |   |         |     |   |   |
|                                                                                                                                                                                                                                                 |   |          |        |   |         |     |   |   |
| STOCKHOLDERS' EQUITY:                                                                                                                                                                                                                                |   |          |        |   |         |     |   |   |
|                                                                                                                                                                                                                                                 |   |          |        |   |         |     |   |   |
| PREFERRED STOCK, $0.01 PAR VALUE:                                                                                                                                                                                                                    |   |          |        |   |         |     |   |   |
| 10,000,000 SHARES AUTHORIZED; 9,102,655 SHARES ISSUED AND OUTSTANDING AT JULY 31, 2010 AND OCTOBER 31, 2009, RESPECTIVELY AND AGGREGATE LIQUIDATION PREFERENCE OF $10 PER SHARE FOR $ 91,026,550 AT JULY 31, 2010 AND OCTOBER 31, 2009, RESPECTIVELY |   |          | 91,027      |   |         |     | 91,027 |   |
|                                                                                                                                                                                                                                                 |   |          |        |   |         |     |   |   |
| COMMON STOCK, $0.01 PAR VALUE:                                                                                                                                                                                                                       |   |          |        |   |         |     |   |   |
| 10,000,000 SHARES AUTHORIZED; 5,313,794 SHARES ISSUED AND 4,326,929 SHARES OUT-STANDING AT JULY 31, 2010 AND OCTOBER 31, 2009, RESPECTIVELY                                                                                                          |   |          | 53,138      |   |         |     | 53,138 |   |
|                                                                                                                                                                                                                                                 |   |          |        |   |         |     |   |   |
| ADDITIONAL PAID-IN CAPITAL                                                                                                                                                                                                                           |   |          | 28,322,341  |   |         |     | 28,322,341 |   |
|                                                                                                                                                                                                                                                 |   |          |        |   |         |     |   |   |
| ACCUMULATED DEFICIT                                                                                                                                                                                                                                  |   |          | (15,475,907 | )      |         |     | (15,068,051 | ) |
|                                                                                                                                                                                                                                                 |   |          |        |   |         |     |   |   |
| 986,865 SHARES OF COMMON STOCK HELD IN TREASURY, AT COST                                                                                                                                                                                             |   |          | (11,003,545 | )      |         |     | (11,003,545 | ) |
|                                                                                                                                                                                                                                                 |   |          |        |   |         |     |   |   |
| COMPREHENSIVE INCOME:                                                                                                                                                                                                                                |   |          |        |   |         |     |   |   |
| PENSION VALUATION RESERVE                                                                                                                                                                                                                            |   |          | (1,834,985  | )      |         |     | (1,915,985 | ) |
|                                                                                                                                                                                                                                                 |   |          | 152,069     |   |         | 478,925_ |   |
|                                                                                                                                                                                                                                                 |   |          |        |   |         |     |   |   |
|                                                                                                                                                                                                                                                 |   | $             | 3,266,299   |   |         | $        | 2,856,021 |   |

----

Index

CANAL 

|                                    |   | 2010        |      |   | 2009        |   |
|-----------------------------------------|--------|-------------|-----------|--------|-------------|--------|
|                                    |   | (UNAUDITED) |      |   | (UNAUDITED) |   |
| REAL ESTATE OPERATIONS:                 |   |        |      |   |        |   |
|                                    |   |        |      |   |        |   |
| REAL ESTATE REVENUES:                   |   |        |      |   |        |   |
| SALE OF REAL ESTATE                     |   |        | 0         |   |        |   | 262,720 |   |
| OUTSIDE REAL ESTATE RENT                |   |        | 202,284   |   |        |   | 290,037 |   |
| EXCHANGE BUILDING RENTAL INCOME         |   |        | 14,493    |   |        |   | 22,160 |   |
|                                    |   |        | 216,777   |   |        |   | 574,917 |   |
|                                    |   |        |      |   |        |   |   |   |
| REAL ESTATE EXPENSES:                   |   |        |      |   |        |   |   |   |
| COST OF REAL ESTATE SOLD                |   |        | 0         |   |        |   | 69,069 |   |
| LABOR, OPERATING AND MAINTENANCE        |   |        | 19,343    |   |        |   | 43,683 |   |
| DEPRECIATION AND AMORTIZATION           |   |        | 16,650    |   |        |   | 16,650 |   |
| TAXES OTHER THAN INCOME TAXES           |   |        | 16,550    |   |        |   | 18,450 |   |
| GENERAL AND ADMINISTRATIVE              |   |        | 16,873    |   |        |   | 29,700 |   |
|                                    |   |        | 69,416    |   |        |   | 177,552 |   |
|                                    |   |        |      |   |        |   |   |   |
| INCOME FROM REAL ESTATE OPERATIONS      |   |        | 147,361   |   |        |   | 397,365 |   |
|                                    |   |        |      |   |        |   |   |   |
|                                    |   |        |      |   |        |   |   |   |
| STOCKYARD OPERATIONS:                   |   |        |      |   |        |   |   |   |
|                                    |   |        |      |   |        |   |   |   |
| STOCKYARD REVENUES:                     |   |        |      |   |        |   |   |   |
| YARD HANDLING AND AUCTION               |   | $           | 1,353,303 |   |        | $      | 1,877,220 |   |
| FEED AND BEDDING INCOME                 |   |        | 79,836    |   |        |   | 150,991 |   |
| RENTAL & OTHER INCOME               |   |        | 214,369   |   |        |   | 122,446 |   |
|                                    |   |        | 1,647,508 |   |        |   | 2,150,657 |   |
|                                    |   |        |      |   |        |   |   |   |
| STOCKYARD EXPENSES:                     |   |        |      |   |        |   |   |   |
| LABOR AND RELATED COSTS                 |   |        | 610,017   |   |        |   | 922,270 |   |
| OTHER OPERATING AND MAINTENANCE         |   |        | 386,417   |   |        |   | 563,524 |   |
| FEED AND BEDDING EXPENSE                |   |        | 66,125    |   |        |   | 113,618 |   |
| DEPRECIATION AND AMORTIZATION           |   |        | 10,103    |   |        |   | 14,863 |   |
| TAXES OTHER THAN INCOME TAXES           |   |        | 116,272   |   |        |   | 127,085 |   |
| GENERAL AND ADMINISTRATIVE              |   |        | 244,123   |   |        |   | 288,734 |   |
|                                    |   |        | 1,433,057 |   |        |   | 2,030,094 |   |
|                                    |   |        |      |   |        |   |   |   |
| INCOME (LOSS) FROM STOCKYARD OPERATIONS |   |        | 214,451   |   |        |   | 120,563 |   |
|                                    |   |        |      |   |        |   |   |   |
|                                    |   |        |      |   |        |   |   |   |
| GENERAL AND ADMINISTRATIVE EXPENSE      |   |        | (627,896  | )      |        |   | (680,400 | ) |
|                                    |   |        |      |   |        |   |   |   |
|                                    |   |        |      |   |        |   |   |   |
| (LOSS) INCOME FROM OPERATIONS           |   |        | (266,084  | )      |        |   | (162,472 | ) |

----

Index

|                                                 |   | 2010        |      |   | 2009        |   |
|------------------------------------------------------|--------|-------------|-----------|--------|-------------|--------|
|                                                 |   | (UNAUDITED) |      |   | (UNAUDITED) |   |
|                                                 |   |        |      |   |        |   |
| OTHER (EXPENSE) INCOME:                              |   |        |      |   |        |   |
| INTEREST & OTHER INCOME                          |   |        | 407       |   |        |   | 7,881 |   |
| INTEREST EXPENSE                                     |   |        | (88,179   | )      |        |   | (94,650 | ) |
| ART SALES AND OPERATIONS                             |   |        | 0         |   |        |   | (3,600 | ) |
|                                                 |   |        |      |   |        |   |   |   |
|                                                 |   |        | (87,772   | )      |        |   | (90,369 | ) |
|                                                 |   |        |      |   |        |   |   |   |
|                                                 |   |        |      |   |        |   |   |   |
| (LOSS) INCOME BEFORE PROVISION FOR INCOME TAXES      |   |        | (353,856  | )      |        |   | (252,841 | ) |
| PROVISION FOR INCOME TAXES                           |   |        | 0         |   |        |   | 0 |   |
|                                                 |   |        |      |   |        |   |   |   |
| NET (LOSS) INCOME                                    |   |        | (353,856  | )      |        |   | (252,841 | ) |
|                                                 |   |        |      |   |        |   |   |   |
|                                                 |   |        |      |   |        |   |   |   |
| OTHER COMPREHENSIVE (LOSS) INCOME:                   |   |        |      |   |        |   |   |   |
|                                                 |   |        |      |   |        |   |   |   |
| MINIMUM PENSION LIABILITY ADJUSTMENT                 |   |        | 81,000    |   |        |   | 90,000 |   |
|                                                 |   |        |      |   |        |   |   |   |
|                                                 |   |        |      |   |        |   |   |   |
| COMPREHENSIVE (LOSS) INCOME                          |   | $           | (272,856  | )      |        | $      | (162,841 | ) |
|                                                 |   |        |      |   |        |   |   |   |
|                                                 |   |        |      |   |        |   |   |   |
| (LOSS) EARNINGS PER COMMON SHARE:                    |   |        |      |   |        |   |   |   |
|                                                 |   |        |      |   |        |   |   |   |
| NET (LOSS) INCOME                                    |   | $           | (353,856  | )      |        | $      | (252,841 | ) |
|                                                 |   |        |      |   |        |   |   |   |
| LESS PREFERRED STOCK DIVIDEND                        |   |        | (54,000   | )      |        |   | (54,000 | ) |
|                                                 |   |        |      |   |        |   |   |   |
| (LOSS) INCOME AVAILABLE TO COMMON STKDERS            |   | $           | (407,856  | )      |        | $      | (306,841 | ) |
|                                                 |   |        |      |   |        |   |   |   |
|                                                 |   |        |      |   |        |   |   |   |
| NET (LOSS) INCOME PER COMMON SHARE BASIC AND DILUTED |   | $           | (0.09     | )      |        | $      | (0.07 | ) |
|                                                 |   |        |      |   |        |   |   |   |
|                                                 |   |        |      |   |        |   |   |   |
| AVERAGE SHARES OUTSTANDING - BASIC AND DILUTED       |   |        | 4,326,929 |   |        |   | 4,326,929 |   |

----

Index

|                                    |   | 2010        |     |   | 2009        |   |
|-----------------------------------------|--------|-------------|----------|--------|-------------|--------|
|                                    |   | (UNAUDITED) |     |   | (UNAUDITED) |   |
| REAL ESTATE OPERATIONS:                 |   |        |     |   |        |   |
|                                    |   |        |     |   |        |   |
| REAL ESTATE REVENUES:                   |   |        |     |   |        |   |
| SALE OF REAL ESTATE                     |   |        | 0        |   |        |   | 0 |   |
| OUTSIDE REAL ESTATE RENT                |   |        | 67,270   |   |        |   | 96,993 |   |
| EXCHANGE BUILDING RENTAL INCOME         |   |        | 2,414    |   |        |   | 6,773 |   |
|                                    |   |        | 69,684   |   |        |   | 103,766 |   |
|                                    |   |        |     |   |        |   |   |   |
| REAL ESTATE EXPENSES:                   |   |        |     |   |        |   |   |   |
| COST OF REAL ESTATE SOLD                |   |        | 0        |   |        |   | 0 |   |
| LABOR, OPERATING AND MAINTENANCE        |   |        | 5,765    |   |        |   | 14,053 |   |
| DEPRECIATION AND AMORTIZATION           |   |        | 5,550    |   |        |   | 5,550 |   |
| TAXES OTHER THAN INCOME TAXES           |   |        | 5,550    |   |        |   | 6,150 |   |
| GENERAL AND ADMINISTRATIVE              |   |        | 7,257    |   |        |   | 9,900 |   |
|                                    |   |        | 24,122   |   |        |   | 35,653 |   |
|                                    |   |        |     |   |        |   |   |   |
| INCOME FROM REAL ESTATE OPERATIONS      |   |        | 45,562   |   |        |   | 68,113 |   |
|                                    |   |        |     |   |        |   |   |   |
|                                    |   |        |     |   |        |   |   |   |
| STOCKYARD OPERATIONS:                   |   |        |     |   |        |   |   |   |
|                                    |   |        |     |   |        |   |   |   |
| STOCKYARD REVENUES:                     |   |        |     |   |        |   |   |   |
| YARD HANDLING AND AUCTION               |   | $           | 277,142  |   |        | $      | 397,784 |   |
| FEED AND BEDDING INCOME                 |   |        | 21,817   |   |        |   | 35,300 |   |
| RENTAL & OTHER INCOME               |   |        | 34,028   |   |        |   | 32,771 |   |
|                                    |   |        | 332,987  |   |        |   | 465,855 |   |
|                                    |   |        |     |   |        |   |   |   |
| STOCKYARD EXPENSES:                     |   |        |     |   |        |   |   |   |
| LABOR AND RELATED COSTS                 |   |        | 145,810  |   |        |   | 242,373 |   |
| OTHER OPERATING AND MAINTENANCE         |   |        | 111,536  |   |        |   | 157,902 |   |
| FEED AND BEDDING EXPENSE                |   |        | 15,826   |   |        |   | 21,470 |   |
| DEPRECIATION AND AMORTIZATION           |   |        | 3,368    |   |        |   | 4,954 |   |
| TAXES OTHER THAN INCOME TAXES           |   |        | 35,886   |   |        |   | 37,064 |   |
| GENERAL AND ADMINISTRATIVE              |   |        | 54,641   |   |        |   | 65,322 |   |
|                                    |   |        | 367,067  |   |        |   | 529,085 |   |
|                                    |   |        |     |   |        |   |   |   |
| INCOME (LOSS) FROM STOCKYARD OPERATIONS |   |        | (34,080  | )      |        |   | (63,230 | ) |
|                                    |   |        |     |   |        |   |   |   |
|                                    |   |        |     |   |        |   |   |   |
| GENERAL AND ADMINISTRATIVE EXPENSE      |   |        | (208,042 | )      |        |   | (230,972 | ) |
|                                    |   |        |     |   |        |   |   |   |
|                                    |   |        |     |   |        |   |   |   |
| (LOSS) INCOME FROM OPERATIONS           |   |        | (196,560 | )      |        |   | (226,089 | ) |

----

Index

|                                                 |   | 2010        |      |   | 2009        |   |
|------------------------------------------------------|--------|-------------|-----------|--------|-------------|--------|
|                                                 |   | (UNAUDITED) |      |   | (UNAUDITED) |   |
|                                                 |   |        |      |   |        |   |
| OTHER (EXPENSE) INCOME:                              |   |        |      |   |        |   |
| INTEREST & OTHER INCOME                          |   |        | 177       |   |        |   | 102 |   |
| INTEREST EXPENSE                                     |   |        | (33,300   | )      |        |   | (31,550 | ) |
| ART SALES AND OPERATIONS                             |   |        | 0         |   |        |   | (1,200 | ) |
|                                                 |   |        |      |   |        |   |   |   |
|                                                 |   |        | (33,123   | )      |        |   | (32,648 | ) |
|                                                 |   |        |      |   |        |   |   |   |
|                                                 |   |        |      |   |        |   |   |   |
| (LOSS) INCOME BEFORE PROVISION FOR INCOME TAXES      |   |        | (229,683  | )      |        |   | (258,737 | ) |
| PROVISION FOR INCOME TAXES                           |   |        | 0         |   |        |   | 0 |   |
|                                                 |   |        |      |   |        |   |   |   |
| NET (LOSS) INCOME                                    |   |        | (229,683  | )      |        |   | (258,737 | ) |
|                                                 |   |        |      |   |        |   |   |   |
|                                                 |   |        |      |   |        |   |   |   |
| OTHER COMPREHENSIVE (LOSS) INCOME:                   |   |        |      |   |        |   |   |   |
|                                                 |   |        |      |   |        |   |   |   |
| MINIMUM PENSION LIABILITY ADJUSTMENT                 |   |        | 27,000    |   |        |   | 30,000 |   |
|                                                 |   |        |      |   |        |   |   |   |
|                                                 |   |        |      |   |        |   |   |   |
| COMPREHENSIVE (LOSS) INCOME                          |   | $           | (202,683  | )      |        | $      | (228,737 | ) |
|                                                 |   |        |      |   |        |   |   |   |
|                                                 |   |        |      |   |        |   |   |   |
| (LOSS) EARNINGS PER COMMON SHARE:                    |   |        |      |   |        |   |   |   |
|                                                 |   |        |      |   |        |   |   |   |
| NET (LOSS) INCOME                                    |   | $           | (229,683  | )      |        | $      | (258,737 | ) |
|                                                 |   |        |      |   |        |   |   |   |
| LESS PREFERRED STOCK DIVIDEND                        |   |        | (18,000   | )      |        |   | (18,000 | ) |
|                                                 |   |        |      |   |        |   |   |   |
| (LOSS) INCOME AVAILABLE TO COMMON STKDERS            |   | $           | (247,683  | )      |        | $      | (276,737 | ) |
|                                                 |   |        |      |   |        |   |   |   |
|                                                 |   |        |      |   |        |   |   |   |
| NET (LOSS) INCOME PER COMMON SHARE BASIC AND DILUTED |   | $           | (0.06     | )      |        | $      | (0.06 | ) |
|                                                 |   |        |      |   |        |   |   |   |
|                                                 |   |        |      |   |        |   |   |   |
| AVERAGE SHARES OUTSTANDING - BASIC AND DILUTED       |   |        | 4,326,929 |   |        |   | 4,326,929 |   |

----

Index

CANAL 

|                      |   | COMMON STOCK   |      |   | PREFERRED STOCK |   |
|---------------------------|--------|----------------|-----------|--------|-----------------|--------|
|                      |   | NUMBEROFSHARES |      |   | AMOUNT          |   |   | NUMBEROFSHARES |   |   | AMOUNT |   |
|                      |   |           |      |   |            |   |   |   |   |   |   |   |
| BALANCE, OCTOBER 31, 2008 |   |           | 5,313,794 |   |            | $      | 53,138 |   |   |   | 9,102,655 |   |   | $ | 91,027 |   |
| NET INCOME                |   |           | 0         |   |            |   | 0 |   |   |   | 0 |   |   |   | 0 |   |
| PREFERRED STOCK DIVIDEND  |   |           | 0         |   |            |   | 0 |   |   |   | 0 |   |   |   | 0 |   |
| MINIMUM PEN. LIAB. ADJ.   |   |           | 0         |   |            |   | 0 |   |   |   | 0 |   |   |   | 0 |   |
|                      |   |           |      |   |            |   |   |   |   |   |   |   |   |   |   |   |
| BALANCE, OCTOBER 31, 2009 |   |           | 5,313,794 |   |            | $      | 53,138 |   |   |   | 9,102,655 |   |   | $ | 91,027 |   |
| NET LOSS                  |   |           | 0         |   |            |   | 0 |   |   |   | 0 |   |   |   | 0 |   |
| PREFERRED STOCK DIVIDEND  |   |           | 0         |   |            |   | 0 |   |   |   | 0 |   |   |   | 0 |   |
| MINIMUM PEN. LIAB. ADJ.   |   |           | 0         |   |            |   | 0 |   |   |   | 0 |   |   |   | 0 |   |
|                      |   |           |      |   |            |   |   |   |   |   |   |   |   |   |   |   |
| BALANCE, JULY 31, 2010    |   |           | 5,313,794 |   |            | $      | 53,138 |   |   |   | 9,102,655 |   |   | $ | 91,027 |   |

|                      |   | ADDITIONALPAID-INCAPITAL |       |   | ACCUMULATEDDEFICIT |   |        | COMPREHENSIVLOSS |   |   | TREASURYSTOCK,AT COST |   |
|---------------------------|--------|--------------------------|------------|--------|--------------------|--------|-------------|------------------|--------|--------|-----------------------|--------|
|                      |   |                     |       |   |               |   |        |             |   |   |                  |   |
| BALANCE, OCTOBER 31, 2008 |   | $                        | 28,322,341 |   |               | $      | (15,025,327 | )                |   | $      | (1,706,472            | )      |   | $ | (11,003,545 | ) |
| NET INCOME                |   |                     | 0          |   |               |   | 30,299      |             |   |   | 0                     |   |   |   | 0 |   |
| PREFERRED STOCK DIVIDEND  |   |                     | 0          |   |               |   | (73,023     | )                |   |   | 0                     |   |   |   | 0 |   |
| MINIMUM PEN. LIAB. ADJ.   |   |                     | 0          |   |               |   | 0           |             |   |   | (209,513              | )      |   |   | 0 |   |
|                      |   |                     |       |   |               |   |        |             |   |   |                  |   |   |   |   |   |
| BALANCE, OCTOBER 31, 2009 |   | $                        | 28,322,341 |   |               | $      | (15,068,051 | )                |   | $      | (1,915,985            | )      |   | $ | (11,003,545 | ) |
| NET LOSS                  |   |                     | 0          |   |               |   | (353,856    | )                |   |   | 0                     |   |   |   | 0 |   |
| PREFERRED STOCK DIVIDEND  |   |                     | 0          |   |               |   | (54,000     | )                |   |   | 0                     |   |   |   | 0 |   |
| MINIMUM PEN. LIAB. ADJ.   |   |                     | 0          |   |               |   | 0           |             |   |   | 81,000                |   |   |   | 0 |   |
| BALANCE, JULY 31, 2010    |   | $                        | 28,322,341 |   |               | $      | (15,475,907 | )                |   | $      | (1,834,985            | )      |   | $ | (11,003,545 | ) |

----

Index

CANAL 

|                                                                                      |   | JULY 2010 |     |   | JULY 2009 |   |
|-------------------------------------------------------------------------------------------|--------|-----------|----------|--------|-----------|--------|
| CASH FLOWS FROM OPERATING ACTIVITIES:                                                     |   |      |     |   |      |   |
| NET (LOSS) INCOME                                                                         |   | $         | (353,856 | )      |      | $      | (252,841 | ) |
|                                                                                      |   |      |     |   |      |   |   |   |
| ADJUSTMENTS TO RECONCILE NET LOSS TO NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES: |   |      |     |   |      |   |   |   |
|                                                                                      |   |      |     |   |      |   |   |   |
| DEPRECIATION AND AMORTIZATION                                                             |   |      | 26,753   |   |      |   | 31,513 |   |
|                                                                                      |   |      |     |   |      |   |   |   |
| GAIN ON SALES OF REAL ESTATE                                                              |   |      | 0        |   |      |   | (193,651 | ) |
|                                                                                      |   |      |     |   |      |   |   |   |
| MINIMUM PENSION LIABILITY ADJUSTMENT                                                      |   |      | 81,000   |   |      |   | 90,000 |   |
|                                                                                      |   |      |     |   |      |   |   |   |
| DECREASE (INCREASE) IN ASSETS:                                                            |   |      |     |   |      |   |   |   |
|                                                                                      |   |      |     |   |      |   |   |   |
| NOTES AND ACCOUNTS RECEIVABLE                                                             |   |      | (164,470 | )      |      |   | (47,203 | ) |
|                                                                                      |   |      |     |   |      |   |   |   |
| STOCKYARDS INVENTORY                                                                      |   |      | 11,729   |   |      |   | 20,144 |   |
|                                                                                      |   |      |     |   |      |   |   |   |
| PREPAID EXPENSES                                                                          |   |      | (44,974  | )      |      |   | (32,294 | ) |
|                                                                                      |   |      |     |   |      |   |   |   |
| RESTRICTED CASH – LETTER OF CREDIT                                                  |   |      | (10,000  | )      |      |   | (30,000 | ) |
|                                                                                      |   |      |     |   |      |   |   |   |
| RESTRICTED CASH – TRANSIT INSURANCE                                                 |   |      | (6,535   | )      |      |   | (14,887 | ) |
|                                                                                      |   |      |     |   |      |   |   |   |
| INCREASE (DECREASE) IN LIABILITIES:                                                       |   |      |     |   |      |   |   |   |
|                                                                                      |   |      |     |   |      |   |   |   |
| ACCOUNTS PAYABLE AND ACCRUED EXPENSES                                                     |   |      | 113,159  |   |      |   | (24,912 | ) |
|                                                                                      |   |      |     |   |      |   |   |   |
| PENSION PLAN PAYABLE                                                                      |   |      | 0        |   |      |   | (45,024 | ) |
|                                                                                      |   |      |     |   |      |   |   |   |
| PAYABLE TO EXECUTIVE OFFICERS                                                             |   |      | 337,875  |   |      |   | 192,464 |   |
|                                                                                      |   |      |     |   |      |   |   |   |
| ACCRUED PROFESSIONAL FEES                                                                 |   |      | (65,969  | )      |      |   | (29,643 | ) |
|                                                                                      |   |      |     |   |      |   |   |   |
| LONG-TERM PENSION LIABILITY                                                               |   |      | (14,540  | )      |      |   | 0 |   |
|                                                                                      |   |      |     |   |      |   |   |   |
| REAL ESTATE TAXES PAYABLE                                                                 |   |      | (27,391  | )      |      |   | 59,283 |   |
|                                                                                      |   |      |     |   |      |   |   |   |
| TOTAL ADJUSTMENTS                                                                         |   |      | 236,637  |   |      |   | (24,210 | ) |
|                                                                                      |   |      |     |   |      |   |   |   |
|                                                                                      |   |      |     |   |      |   |   |   |
| NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES                                       |   |      | (117,219 | )      |      |   | (277,051 | ) |

----

Index

|                                                   |   | JULY 2010 |     |   | JULY 2009 |   |
|--------------------------------------------------------|--------|-----------|----------|--------|-----------|--------|
|                                                   |   |      |     |   |      |   |
| CASH FLOWS FROM INVESTING ACTIVITIES:                  |   |      |     |   |      |   |
|                                                   |   |      |     |   |      |   |
| PROCEEDS FROM SALES OF REAL ESTATE                     |   |      | 0        |   |      |   | 262,720 |   |
| COSTS RELATING TO SALES OF REAL ESTATE                 |   |      | 0        |   |      |   | (29,809 | ) |
| CAPITAL EXPENDITURES                                   |   |      | (375,000 | )      |      |   | 0 |   |
|                                                   |   |      |     |   |      |   |   |   |
| NET CASH PROVIDED BY INVESTING ACTIVITIES              |   |      | (375,000 | )      |      |   | 232,911 |   |
|                                                   |   |      |     |   |      |   |   |   |
|                                                   |   |      |     |   |      |   |   |   |
| CASH FLOWS PROVIDED BY (USED) IN FINANCING ACTIVITIES: |   |      |     |   |      |   |   |   |
|                                                   |   |      |     |   |      |   |   |   |
| PROCEEDS FROM LONG-TERM DEBT OBLIGATION                |   |      | 340,000  |   |      |   | 30,000 |   |
| REPAYMENT OF LONG-TERM DEBT OBLIGATION                 |   |      | 0        |   |      |   | 0 |   |
|                                                   |   |      |     |   |      |   |   |   |
| NET CASH PROVIDED BY (USED) IN FINANCING ACTIVITIES    |   |      | 340,000  |   |      |   | 30,000 |   |
|                                                   |   |      |     |   |      |   |   |   |
|                                                   |   |      |     |   |      |   |   |   |
| NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS   |   |      | (152,219 | )      |      |   | (14,140 | ) |
|                                                   |   |      |     |   |      |   |   |   |
| CASH AND CASH EQUIVALENTS AT BEGN OF YEAR              |   |      | 154,624  |   |      |   | 21,115 |   |
|                                                   |   |      |     |   |      |   |   |   |
|                                                   |   |      |     |   |      |   |   |   |
| CASH AND CASH EQUIVALENTS AT END OF YEAR               |   | $         | 2,405    |   |      | $      | 6,975 |   |

|                                                                  |   | JULY 31, |   |
|-----------------------------------------------------------------------|--------|----------|--------|
|                                                                  |   | 2010     |   |   | 2009 |   |
| SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:                    |   |     |   |   |   |   |
|                                                                  |   |     |   |   |   |   |
| CASH PAID DURING THE YEAR FOR:                                        |   |     |   |   |   |   |
|                                                                  |   |     |   |   |   |   |
| INTEREST                                                              |   | $        | 88,179 |   |   | $ | 94,650 |   |
| INCOME TAXES                                                          |   | $        | 0      |   |   | $ | 0 |   |
|                                                                  |   |     |   |   |   |   |   |   |
| SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: |   |     |   |   |   |   |   |   |
|                                                                  |   |     |   |   |   |   |   |   |
| PREFERRED STOCK DIVIDENDS                                             |   | $        | 54,000 |   |   | $ | 54,000 |   |

----

Index

CANAL 

----

Index

----

Index

----

Index

----

Index

----

Index

----

Index

----

Index

|                                                          |   | July 31, |   |   | October 31, |   |
|---------------------------------------------------------------|--------|----------|--------|--------|-------------|--------|
| ($ 000's Omitted)                                             |   | 2010     |   |   | 2009        |   |
| Variable rate mortgage notes due May 15, 2012 - related party |   | $        | 1,332  |   |        | $      | 992 |   |
| Less -- current maturities                                    |   |     | 0      |   |        |   | 0 |   |
| Long-term debt                                                |   | $        | 1,332  |   |        | $      | 992 |   |

|                       |   | Total  |   |   | Less Than1 year |   |   | 1 - 3Years |   |   | 3 - 5Years |   |   | MoreThan5Yrs. |   |
|----------------------------|--------|--------|--------|--------|-----------------|--------|--------|------------|--------|--------|------------|--------|--------|---------------|--------|
|                       |   |   |   |   |            |   |   |       |   |   |       |   |   |          |   |
| Pension Plan Liability (a) |   | $      | 797    |   |            | $      | 58     |       |   | $      | 500        |   |   | $             | 239    |   |   | $ | 0 |   |
| Mortgage Notes Payable (b) |   |   | 1,332  |   |            |   | 0      |       |   |   | 1,332      |   |   |          | 0      |   |   |   | 0 |   |
|                       |   | $      | 2,129  |   |            | $      | 58     |       |   | $      | 1,832      |   |   | $             | 239    |   |   | $ | 0 |   |

|   | (a) | See Note 16. |
|--------|-----|--------------|

|   | (b) | The mortgage notes are due May 15, 2012 and are held entirely by the Company’s Chief Executive Officer and members of his family. These notes carry annual interest of 10% and are collateralized by substantially all of Canal’s property, the stock of certain subsidiaries and its art inventories. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

Index

----

Index

----

Index

|                                                |   | Historical Cost |   |   | Current Year (Retirements Additions |   |   |   |   |   | Carrying     |   |
|-----------------------------------------------------|--------|-----------------|--------|--------|-------------------------------------|--------|--------|--------|--------|--------|--------------|--------|
|                                                |   |            |   |   | Bldgs. &                        |   |   |   |   |   | Bldgs. & |   |   | Accum. |   |   | Value |   |
| Description (1)                                     |   | Land            |   |   | Imprvmts.                           |   |   | Land   |   |   | Imprvmts.    |   |   | Depr. |   |   | 07/31/10 |   |
| New York office Leasehold assets                    |   | $               | 0      |   |                                | $      | 8      |   |   | $      | 0            |   |   | $ | 0 |   |   | $ | (8 | ) |   | $ | 0 |   |
|                                                |   |            |   |   |                                |   |   |   |   |   |         |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 9 acres of land in Omaha, NE Acquired in 1976       |   |            | 800    |   |                                |   | 21     |   |   |   | 0            |   |   |   | 0 |   |   |   | (17 | ) |   |   | 804 |   |
|                                                |   |            |   |   |                                |   |   |   |   |   |         |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 3 acres of land in S. St. Paul, MN Acquired in 1937 |   |            | 10     |   |                                |   | 485    |   |   |   | 0            |   |   |   | 0 |   |   |   | (442 | ) |   |   | 53 |   |
|                                                |   |            |   |   |                                |   |   |   |   |   |         |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 4 acres of land in Sioux City, IA Acquired in 1937  |   |            | 200    |   |                                |   | 0      |   |   |   | 340          |   |   |   | 0 |   |   |   | 0 |   |   |   | 540 |   |
|                                                |   | $               | 1,010  |   |                                | $      | 514    |   |   | $      | 340          |   |   | $ | 0 |   |   | $ | (467 | ) |   | $ | 1,397 |   |

|                          |   | July 30, |   |   | October 31, |   |
|-------------------------------|--------|----------|--------|--------|-------------|--------|
|                          |   | 2010     |   |   | 2009        |   |
| Balance at beginning of year  |   | $        | 1,074  |   |        | $      | 1,646 |   |
| Acquisitions and Improvements |   |     | 340    |   |        |   | 0 |   |
| Cost of property sold         |   |     | 0      |   |        |   | (550 | ) |
| Depreciation                  |   |     | (17    | )      |        |   | (22 | ) |
| Reclassifications             |   |     | 0      |   |        |   | 0 |   |
| Balance at end of the period  |   | $        | 1,397  |   |        | $      | 1,074 |   |

|   | (1) | Substantially all of Canal’s real property is pledged as collateral for its debt obligations. |
|--------|-----|-----------------------------------------------------------------------------------------------------|

----

Index

|                                                |   | Historical Cost |   |   | Current Year (Retirements) Additions |   |   |   |   |   | Carrying     |   |
|-----------------------------------------------------|--------|-----------------|--------|--------|--------------------------------------|--------|--------|--------|--------|--------|--------------|--------|
|                                                |   |            |   |   | Bldgs. &                         |   |   |   |   |   | Bldgs. & |   |   | Accum. |   |   | Value |   |
| Description (1)                                     |   | Land            |   |   | Imprvmts.                            |   |   | Land   |   |   | Imprvmts.    |   |   | Depr. |   |   | 07/31/10 |   |
|                                                |   |            |   |   |                                 |   |   |   |   |   |         |   |   |   |   |   |   |   |
| 30 acres of land in St. Joseph, MO Acquired in 1942 |   | $               | 902    |   |                                 | $      | 265    |   |   | $      | 0            |   |   | $ | 35 |   |   | $ | (189 | ) |   | $ | 1,013 |   |

|                          |   | July 31, |   |   | October 31, |   |
|-------------------------------|--------|----------|--------|--------|-------------|--------|
|                          |   | 2010     |   |   | 2009        |   |
|                          |   |     |   |   |        |   |
| Balance at beginning of year  |   | $        | 988    |   |        | $      | 1,125 |   |
| Acquisitions and Improvements |   |     | 35     |   |        |   | 0 |   |
| Transfers                     |   |     | 0      |   |        |   | (116 | ) |
| Depreciation                  |   |     | (10    | )      |        |   | (21 | ) |
| Balance at end of the period  |   | $        | 1,013  |   |        | $      | 988 |   |

----

Index

|                                                 |   | Historical Cost |   |   | Current Year (Retirements) Additions |   |   |   |   |   | Carrying     |   |
|------------------------------------------------------|--------|-----------------|--------|--------|--------------------------------------|--------|--------|--------|--------|--------|--------------|--------|
|                                                 |   |            |   |   | Bldgs. &                         |   |   |   |   |   | Bldgs. & |   |   | Accum. |   |   | Value |   |
| Description (1)                                      |   | Land            |   |   | Imprvmts.                            |   |   | Land   |   |   | Imprvmts.    |   |   | Depr. |   |   | 07/31/10 |   |
|                                                 |   |            |   |   |                                 |   |   |   |   |   |         |   |   |   |   |   |   |   |
| 35 acres of land in Sioux Falls, SD Acquired in 1937 |   | $               | 220    |   |                                 |   | N/A    |   |   | $      | 0            |   |   |   | N/A |   |   |   | N/A |   |   | $ | 220 |   |
|                                                 |   |            |   |   |                                 |   |   |   |   |   |         |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 2 acres of land in Sioux City, IA Acquired in 1937   |   |            | 53     |   |                                 |   | N/A    |   |   | $      | 0            |   |   |   | N/A |   |   |   | N/A |   |   |   | 53 |   |
|                                                 |   | $               | 273    |   |                                 | $      | 0      |   |   | $      | 0            |   |   | $ | 0 |   |   | $ | 0 |   |   | $ | 273 |   |

|                          |   | July 31, |   |   | October 31, |   |
|-------------------------------|--------|----------|--------|--------|-------------|--------|
|                          |   | 2010     |   |   | 2009        |   |
|                          |   |     |   |   |        |   |
| Balance at beginning of year  |   | $        | 273    |   |        | $      | 92 |   |
| Acquisitions and Improvements |   |     | 0      |   |        |   | 0 |   |
| Cost of property sold         |   |     | 0      |   |        |   | (39 | ) |
| Reclassification of property  |   |     | 0      |   |        | 220_   |   |
| Balance at end of the period  |   | $        | 273    |   |        | $ 273_ |   |

----

Index

|                               |   | Nine Months Ended |    |
|------------------------------------|--------|-------------------|---------|
|                               |   | 7/31/10           |    |   | 7/31/09 |   |
|                               |   |              |    |   |   |   |
|                               |   |              |    |   |   |   |
| Service cost                       |   |              | 4,000   |   |   |   | 4,000 |   |
| Interest cost                      |   |              | 75,000  |   |   |   | 76,000 |   |
| Expected return on plan assets     |   |              | (80,000 | ) |   |   | (80,000 | ) |
| Amortization of prior service cost |   |              | 0       |   |   |   | 0 |   |
| Recognized net actuarial loss      |   |              | 90,000  |   |   |   | 90,000 |   |
| Net periodic benefit cost          |   |              | 89,000  |   |   |   | 90,000 |   |

----

Index

----

Index

| ITEM II. | MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE RESULTS OF OPERATIONS AND FINANCIAL CONDITION FOR THE NINE MONTHS ENDED JULY 31, 2010 |
|----------|-----------------------------------------------------------------------------------------------------------------------------------|

----

Index

----

Index

----

Index

----

Index

----

Index

|                                |   | Nine Months Ended July 31, |   |
|-------------------------------------|--------|----------------------------|--------|
|                                |   | 2010                       |   |   | 2009 |   |
| (In Thousands)                      |   |                       |   |   |   |   |
| Revenues:                           |   |                       |   |   |   |   |
| Real Estate Revenues                |   | $                          | 217    |   |   | $ | 575 |   |
| Stockyard Revenues                  |   |                       | 1,648  |   |   |   | 2,151 |   |
| Total Revenues                      |   |                       | 1,865  |   |   |   | 2,726 |   |
|                                |   |                       |   |   |   |   |   |   |
| Costs and Expenses:                 |   |                       |   |   |   |   |   |   |
| Real Estate Expenses                |   |                       | 70     |   |   |   | 178 |   |
| Stockyard Expenses                  |   |                       | 1,433  |   |   |   | 2,030 |   |
| General and Administrative Expenses |   |                       | 628    |   |   |   | 680 |   |
| Total Costs and Expenses            |   |                       | 2,131  |   |   |   | 2,888 |   |
|                                |   |                       |   |   |   |   |   |   |
| (Loss) Income from Operations       |   |                       | (266   | ) |   |   | (162 | ) |
|                                |   |                       |   |   |   |   |   |   |
| Other Income                        |   |                       | 0      |   |   |   | 8 |   |
| Other Expenses                      |   |                       | (88    | ) |   |   | (99 | ) |
| Net (Loss) Income                   |   | $                          | (354   | ) |   | $ | (253 | ) |

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Index

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Index

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Index

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Index

Liquidity 

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Index

Other 

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Index

| ITEM III. | Quantitative and Qualitative Disclosures About Market Risk |
|-----------|------------------------------------------------------------|

| As of      |   | Fixed rate |   |   | Average       |   | Fair   |
|------------|--------|------------|--------|--------|---------------|--------|--------|
| July 31,   |   | ($ US)     |   |   | Interest Rate |   | Value  |
| 2010       |   | $          | 0      |   |          |   | N/A    |   |   |
| 2011       |   |       | 0      |   |          |   | N/A    |   |   |
| 2012       |   |       | 1,332  |   |          |   | 10%    |   |   |
| 2013       |   |       | 0      |   |          |   | N/A    |   |   |
| 2014       |   |       | 0      |   |          |   | N/A    |   |   |
| Thereafter |   |       | 0      |   |          |   | N/A    |   |   |
| Total      |   | $          | 1,332  |   |          |   |   |   | N/A (A) |

| (A) | Long-term debt related party: it is not practicable to estimate the fair value of the related party debt. |
|-----|-----------------------------------------------------------------------------------------------------------|

| ITEM IV. | Controls and Procedures |
|----------|-------------------------|

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Index

PART 

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Index

Item 

Item 

Item 

Item 

| Item 6: Exhibits and Reports on Form 8-K: | (A) | Not applicable. |
|-------------------------------------------|-----|-----------------|

|   | (B) | None |
|--------|-----|------|

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Index

SIGNATURES

|   | CANAL CAPITAL CORPORATION |
|--------|---------------------------|
|   |                      |   |
|   |                      |   |
|   | By:                       | /S/ Michael E. Schultz |
|   |                      | Michael E. Schultz |
|   |                      | President and Chief |
|   |                      | Executive Officer |
|   |                      | (Principal Executive Officer) |

| Signature              |   | Title                                                                                       |           | Date   |
|------------------------|--------|---------------------------------------------------------------------------------------------|----------------|--------|
|                   |   |                                                                                        |           |   |
| /S/ Michael E. Schultz |   | President and Chief Executive Officer and Director (Principal Executive Officer)            |           |   |
| Michael E. Schultz     |   |                                                                                        | Sept. 13, 2010 |
|                   |   |                                                                                        |           |   |
| /S/ Reginald Schauder  |   | Vice President-Finance Secretary and Treasurer (Principal Financial and Accounting Officer) |           |   |
| Reginald Schauder      |   |                                                                                        | Sept. 13, 2010 |
|                   |   |                                                                                        |           |   |
| /S/ Asher B. Edelman   |   | Chairman of the Board and Director                                                          |           |   |
| Asher B. Edelman       |   |                                                                                        | Sept. 13, 2010 |

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