SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

      FOR ANNUAL AND TRANSITIONAL REPORTS UNDER SECTION 13 OR 15(D) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                                   (MARK ONE)

      |X|   ANNUAL REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
            ACT OF 1934 FOR FISCAL QUARTER ENDED JUNE 30, 2005

      |_|   TRANSITION REPORT PURSUANT TO SECTION 13 OR SECTION 15(D) OF THE
            SECURITIES EXCHANGE ACT OF 1934

         FOR THE TRANSITION PERIOD FROM _____________ TO ______________

                        COMMISSION FILE NUMBER: 000-31403

                          INTERNATIONAL SURFACING, INC.
--------------------------------------------------------------------------------
      (Exact Name of Small Business Registrant as Specified in its Charter)

                   DELAWARE                             52-2257557
--------------------------------------------------------------------------------
        (State or other jurisdiction of   (I.R.S. Employer Identification No.)
         incorporation or organization)

                        5 Erie Street, Garfield, NJ 07026
--------------------------------------------------------------------------------
               (Address of principal executive offices) (Zip Code)

                                 (973) 253-6131
--------------------------------------------------------------------------------
              (Registrant's telephone number, including area code)

              Securities Registered Under Section 12(B) Of The Act:

                                      None

         Securities Registered Under Section 12(G) of the Exchange Act:

                                (Title Of Class)
                         Common Stock, Par Value $0.0001

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

Check if no disclosure of delinquent filers in response to Item 405 of
Regulation S-B is contained in this form, and no disclosure will 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-QSB or any
amendment to this Form 10-QSB. [__]

The Registrant's Common Stock is not traded on any market at the date of this
report.

As of August 18, 2005, the Registrant had outstanding 30,754,480 shares of
Common Stock, $0.0001 par value.

The Registrant's revenues for the quarter ended June 30, 2005 were $0.


                                       1
<PAGE>

                          INTERNATIONAL SURFACING, INC.
                         (A DEVELOPMENTAL STAGE COMPANY)

                              FINANCIAL STATEMENTS

                                  June 30, 2005

                                Table of Contents
<TABLE>
<CAPTION>
                                                                                    Page
                                                                                 Nummber
                                                                                 -------
<S>                                                                                  <C>
Part I - Financial Information

Item 1   Financial Statements:

      Balance Sheet as of June 30, 2005 and December 31, 2004                         3

      Statement of Operations for the six and three months
       ended June 30, 2005 and June 30, 2004                                          4

      Statement of Stockholders' Deficit from January 1, 2002 (Date of
            Inception) through the six months ended June 30, 2005                     5

      Statement of Cash Flows for the six months ended June 30, 2005 and
         June 30, 2004                                                                9


Notes to Financial Statements                                                        10

Item 2 Management's Discussion and Analysis or Plan of Operations                    16

Item 3 Controls and Procedures                                                       20

Part II Other Information

Item 1 Legal Proceedings                                                             20

Item 2 Unregistered Sales of Equity Securities                                       20

Item 3 Defaults Upon Senior Securities                                               20

Item 4 Submission of Matters to a Vote of Security Holders                           20

Item 5 Other Information                                                             20

Item 6 Exhibits                                                                      20
</TABLE>


                                       2
<PAGE>

                          INTERNATIONAL SURFACING, INC.
                         (A DEVELOPMENTAL STAGE COMPANY)

                                 BALANCE SHEETS


                    As of June 30, 2005 and December 31, 2004
<TABLE>
<CAPTION>
                                                                                          June 30,            Dec. 31,
                                                                                            2005                2004
                                                                                     -----------------    ----------------
                                                                                           (Unaudited)         (Note 1)
                                                                                                              (Restated)
                                       ASSETS
<S>                                                                                      <C>                <C>
Current Assets:
Cash                                                                                     $   253,232        $       146
Investment in unaffiliated company (Note 5)                                                     --                  150
Loans receivable                                                                                 290                290
Other receivable                                                                                 150                150
                                                                                         -----------        -----------
        Total current assets                                                                 253,672                736
                                                                                         -----------        -----------

Fixed Assets, net (Note 6)                                                                    13,874             11,757
Security deposits                                                                              5,000              5,000
                                                                                         -----------        -----------

           Total assets                                                                  $   272,546        $    17,493
                                                                                         ===========        ===========

                        LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
      Accounts payable                                                                   $    88,985        $    91,732
      Accrued expenses                                                                        77,250             77,250
      Loans payable-other (Note 7)                                                            18,500              8,000
      Loans payable -officer (Note 7)                                                        591,690            123,437
                                                                                         -----------        -----------
          Total current liabilities                                                          776,425            300,419
                                                                                         -----------        -----------
 Stockholders' deficit:
       Preferred stock, par value $.0001, per share; authorized 20,000,000 shares,
        none issued and outstanding                                                             --                 --

       Common stock, par value $.0001, per share; 100,000,000 shares authorized,
        30,694,480 shares issued and outstanding at June 30, 2005 and 32,194,480
        shares issued and outstanding and at December 31, 2004
                                                                                               3,069              3,219
       Additional paid in capital                                                          1,045,701          1,045,701
       Deficit accumulated during the developmental stage                                 (1,552,649)        (1,331,846)
                                                                                         -----------        -----------
           Total stockholders' deficit                                                      (503,879)          (282,926)
                                                                                         -----------        -----------
          Total liabilities and stockholders' deficit                                    $   272,546        $    17,493
                                                                                         ===========        ===========
</TABLE>

       The accompanying notes and independent auditors' report should be
                read in conjunction with the financial statements


                                       3
<PAGE>

                          INTERNATIONAL SURFACING, INC.
                         (A DEVELOPMENTAL STAGE COMPANY)

                             STATEMENT OF OPERATIONS

            For the Six and Three Months Ended June 30, 2005 and 2004


<TABLE>
<CAPTION>
                                                Six Months Ended                   Three Months Ended
                                                ----------------                   ------------------              Cumulative
                                           June 30,           June 30,        June 30,          June 30,          Developmental
                                             2005               2004            2005              2004                Stage
                                       -----------------   --------------  --------------   ----------------    ---------------
<S>                                    <C>                 <C>             <C>              <C>                 <C>
Expenses:
Research and development (Note 11)     $           6,903   $       17,301  $        1,695   $          3,309            302,858
General and administrative (Note 9)              211,017          134,060         141,117             50,402            659,646
Compensation expense                                  --               --              --                 --            577,250
Depreciation and amortization                      2,883            2,816           1,441              1,408             12,895
                                       -----------------   --------------  --------------   ----------------    ---------------
Total expenses                                   220,803          154,177         144,253             55,119          1,552,649
                                       -----------------   --------------  --------------   ----------------    ---------------

Net loss                               $        (220,803)  $     (154,177) $     (144,253)  $        (55,119)   $    (1,552,649)
                                       =================   ==============  ==============   ================    ===============

Basic and fully diluted loss per
common share                           $            (.01)  $         (.01)   $       (.01)  $           (.00)
                                       =================   ==============  ==============   ================

Weighted average number of shares
outstanding                                   31,994,480       26,758,280      31,694,480         26,886,080
                                       =================   ==============  ==============   ================
</TABLE>

       The accompanying notes and independent auditors' report should be
                read in conjunction with the financial statements


                                       4
<PAGE>

                          INTERNATIONAL SURFACING, INC.
                         (A DEVELOPMENTAL STAGE COMPANY)

                       STATEMENT OF STOCKHOLDERS' DEFICIT

                From Inception (January 1, 2002) to June 30, 2005
                                   (Restated)

<TABLE>
<CAPTION>
                                                                       Additional                    Total
                                                   Common Stock         Paid-in     Accumulated    Stockholders'
                                               Shares       Amount      Capital       Deficit         Equity
                                             ----------   ----------   ----------    ----------    ----------
<S>                                          <C>               <C>        <C>                         <C>
Balances at January 1, 2002                        --     $     --     $     --      $     --      $     --

Sale of common stock                              1,200          760         --            --             760

Exchange of shares with acquired Company
  (Harmonica Acquisition Corp.)              24,998,800        1,740      (16,740)         --         (15,000)

Amount received for convertible debentures      211,200           21       52,779        52,800

Net loss                                           --           --           --         (78,307)      (78,307)
                                             ----------   ----------   ----------    ----------    ----------

Balances at January 1, 2003                  25,211,200        2,521       36,039       (78,307)      (39,747)

Shares issued in January 2003
  pursuant to private placements                165,880           17       41,453          --          41,470

Shares issued in February 2003
  pursuant to private placements                  7,200            1        1,799          --           1,800

Shares issued in April 2003
  pursuant to private placements                283,000           28       70,722          --          70,750

Shares issued in May 2003
  pursuant to private placements                 40,000            4        9,996          --          10,000

Shares issued in June 2003
  pursuant to private placements                239,400           24       59,826          --          59,850

Shares issued in July 2003
  pursuant to private placements                115,500           11       28,864          --          28,875

Shares issued in August 2003
  pursuant to private placements                101,400           10       36,707          --          36,717
</TABLE>

       The accompanying notes and independent auditors' report should be
                read in conjunction with the financial statements


                                       5
<PAGE>

                          INTERNATIONAL SURFACING, INC.
                         (A DEVELOPMENTAL STAGE COMPANY)

                       STATEMENT OF STOCKHOLDERS' DEFICIT

                From Inception (January 1, 2002) to June 30, 2005
                                   (Restated)

<TABLE>
<CAPTION>
                                                                          Additional                    Total
                                                     Common Stock          Paid-in     Accumulated    Stockholders'
                                                  Shares       Amount      Capital       Deficit         Equity
                                                ----------   ----------   ----------    ----------    ----------
<S>                                             <C>               <C>        <C>                         <C>
Shares issued in October 2003
  pursuant to private placements
                                                   165,000           16       41,234         --          41,250

Shares issued in November 2003
  pursuant to private placements
                                                    58,000            6       14,494         --          14,500

Shares issued in December 2003
  pursuant to private placements
                                                    37,500            4        9,371         --           9,375

Net loss for the year ended December 31, 2003         --           --           --       (470,365)     (470,365)
                                                ----------   ----------   ----------   ----------    ----------

Balances at December 31, 2003                   26,424,080        2,642      350,505     (548,672)     (195,525)

Shares issued in January 2004
  pursuant to private placements                    79,000            8       19,742         --          19,750

Shares issued in February 2004
  pursuant to private placements
                                                   166,000           17       41,483         --          41,500

Shares issued in March 2004
  pursuant to private placements                   113,200           11       28,289         --          28,300

Shares issued in April 2004
  pursuant to private placements                    68,200            7       19,916         --          19,923
</TABLE>

           The accompanying notes should be read in conjunction with
                           these financial statements


                                       6
<PAGE>

                          INTERNATIONAL SURFACING, INC.
                         (A DEVELOPMENTAL STAGE COMPANY)

                       STATEMENT OF STOCKHOLDERS' DEFICIT

                From Inception (January 1, 2002) to June 30, 2005
                                   (Restated)

<TABLE>
<CAPTION>
                                                                          Additional                    Total
                                                     Common Stock          Paid-in     Accumulated    Stockholders'
                                                  Shares       Amount      Capital       Deficit         Equity
                                                ----------   ----------   ----------    ----------    ----------
<S>                                             <C>               <C>        <C>                         <C>
Shares issued in May 2004
  pursuant to private placements                  50,000           5        12,495        --            12,500

Shares issued in June 2004
  pursuant to private placements                  74,000           7        18,493        --            18,500

Shares issued in July 2004
  pursuant to private placements                  87,000           9        21,741        --            21,750

Shares issued in August 2004
  pursuant to private placements                  30,000           3         7,497        --             7,500

Shares issued in September 2004
  pursuant to private placements
                                                  22,000           2         5,498        --             5,500

Shares issued in October 2004
  pursuant to private placements
                                                   1,000           0           250        --               250

Shares issued in October 2004 as
  compensation of officers
                                               2,000,000         200       499,800        --           500,000

Shares issued in October 2004
  pursuant to investment in Innovative
  Cooling Enterprises, Inc.                    1,500,000         150             0        --               150

Shares issued in November 2004
  pursuant to private placements
                                                  80,000           8        19,992        --            20,000

Shares issued in November 2004
  in consideration for professional services
                                               1,500,000         150             0        --               150
</TABLE>

       The accompanying notes and independent auditors' report should be
                read in conjunction with the financial statements


                                       7
<PAGE>

                          INTERNATIONAL SURFACING, INC.
                         (A DEVELOPMENTAL STAGE COMPANY)

                       STATEMENT OF STOCKHOLDERS' DEFICIT

                From Inception (January 1, 2002) to June 30, 2005
                                   (Restated)

<TABLE>
<CAPTION>
                                                                          Additional                    Total
                                                     Common Stock          Paid-in      Accumulated    Stockholders'
                                                  Shares       Amount       Capital       Deficit         Equity
                                            -----------    -----------    -----------   -----------    -----------
<S>                                          <C>           <C>            <C>           <C>            <C>
Net loss for the year ended
  December 31, 2004                                --             --             --        (783,174)      (783,174)
                                            -----------    -----------    -----------   -----------    -----------

Balances at December 31, 2004                32,194,480          3,219      1,045,701    (1,331,846)      (282,926)

Cancellation of shares issued
  in exchange for ICE shares (see Note 5)
                                             (1,500,000)          (150)          --            --             (150)

Net loss for the six months
  ended June 30, 2005                              --             --             --        (220,803)      (220,803)
                                            -----------    -----------    -----------   -----------    -----------

Balances at June 30, 2005                    30,694,480    $     3,069    $ 1,045,701   $(1,552,649)   $  (503,879)
                                            ===========    ===========    ===========   ===========    ===========
</TABLE>

       The accompanying notes and independent auditors' report should be
                read in conjunction with the financial statements

                                       8
<PAGE>

                          INTERNATIONAL SURFACING, INC.
                         (A DEVELOPMENTAL STAGE COMPANY)

                             STATEMENT OF CASH FLOWS

                For the Three Months Ended June 30, 2005 and 2004

<TABLE>
<CAPTION>
                                                                                                                        Cumulative
                                                                                 June 30,             June 30,          Development
                                                                                  2005                 2004                Stage
                                                                                -----------         -----------         -----------
<S>                                                                             <C>                 <C>                 <C>
Cash flows from operating activities:
Net loss                                                                        $  (220,803)        $  (154,177)        $(1,552,649)
                                                                                -----------         -----------         -----------
Adjustments to reconcile net loss to net cash used in
  operating activities:
        Depreciation and amortization                                                 2,883               2,816              12,895
        Compensation expense                                                           --                  --               412,000

Changes in assets and liabilities:
        (Increase) decrease in loans receivable                                        --                  --                  (290)
        Decrease in other receivable                                                   --                  --                  (150)
        (Decrease) in bank overdraft                                                   --                  --                (5,000)
        Increase in accounts payable                                                 (2,748)              4,493              89,135
        Increase (decrease) in accrued expenses                                        --                  --               165,250
        Increase in loans payable-other                                              10,500                --                18,500
                                                                                -----------         -----------         -----------

Net adjustment to reconcile net income to net cash
  provided (used) in operating activities:                                           10,635               7,309             692,340
                                                                                -----------         -----------         -----------

Net cash used in operating activities                                              (210,168)           (146,868)           (860,309)
                                                                                -----------         -----------         -----------
Cash flows from investing activities:
        Payment made in connection with recapitalization                               --                  --               (15,000)
        Purchase of equipment                                                        (5,000)             (3,780)            (26,769)
                                                                                -----------         -----------         -----------

Net cash used in investing activities                                                (5,000)             (3,780)            (41,769)
                                                                                -----------         -----------         -----------

Cash flows from financing activities:
        Issuance of additional shares of common stock                                  --                    54                 958
        Additional paid in capital arising from
          issuance of additionalshares                                                 --               124,415             509,862
        Execution of convertible notes payable                                         --                  --                52,800
        Increase in loans payable- officer                                          468,254              23,682             591,690
                                                                                -----------         -----------         -----------

Net cash provided by financing activities                                           468,254             148,151           1,155,310
                                                                                -----------         -----------         -----------

Net increase (decrease) in cash                                                     253,086              (2,497)            253,232
Cash at beginning of period                                                             146               2,711                  --

                                                                                -----------         -----------         -----------
Cash at end of period                                                           $   253,232         $       214         $   253,232
                                                                                ===========         ===========         ===========

Interest paid                                                                   $     6,558         $      --
                                                                                ===========         ===========         ===========
Taxes paid                                                                      $      --           $      --
                                                                                ===========         ===========         ===========
</TABLE>

       The accompanying notes and independent auditors' report should be
                read in conjunction with the financial statements


                                       9

<PAGE>

                          INTERNATIONAL SURFACING, INC.
                         (A DEVELOPMENTAL STAGE COMPANY)

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

Note 1-     INTERIM RESULTS AND BASIS OF PRESENTATION

            The accompanying unaudited financial statements as of June 30, 2005
            and June 30, 2004 and for the six and three months then ended have
            been prepared in accordance with generally accepted accounting
            principles for interim financial information and with the
            instructions to Form 10-QSB. In the opinion of management, the
            unaudited financial statements have been prepared on the same basis
            as the annual financial statements and reflect all adjustments,
            which include only normal recurring adjustments, necessary to
            present fairly the financial position as of June 30, 2005 and June
            30, 2004 and the results of operations and cash flows for the six
            and three months then ended. The financial data and other
            information disclosed in these notes to the interim financial
            statements related to these periods are unaudited. The results for
            the six and three months ended June 30, 2005, are not necessarily
            indicative of the results to be expected for any subsequent quarter
            or the entire fiscal year. The balance sheet at December 31, 2004
            has been derived from the audited financial statements at that date.

            Certain information and footnote disclosures normally included in
            financial statements prepared in accordance with generally accepted
            accounting principles have been condensed or omitted pursuant to the
            Securities and Exchange Commission's rules and regulations. The
            Company believes, however, that the disclosures in this report are
            adequate to make the information presented not misleading in any
            material respect. The accompanying financial statements should be
            read in conjunction with the audited financial statements of
            International Surfacing, Inc. as of December 31, 2004 and the notes
            thereto included in the Company's report on Form 10-KSB as filed
            with the Securities and Exchange Commission

Note 2 -    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

            Description of Business:

            Harmonica Acquisition Corporation, a Delaware corporation ("the
            Company") was formed on March 24, 1999, but did not conduct any
            operating activities nor generate any revenues and was dormant until
            January 2002. On January 1, 2002 (Date of Inception) the company
            commenced operating activities.

            The Company was founded to develop, manufacture, market and
            distribute rubber horseshoes and related products. The Company's
            initial target markets are the horse racing and equestrian
            industries. Management believes that the product can be utilized
            throughout the equine world.

            In December 2002, International Surfacing Inc. ("ISI") purchased all
            of the outstanding common stock of the Company for $15,000 in a
            transaction deemed to be a recapitalization. As a part of the
            overall transaction, ISI, exchanged its common shares of the Company
            for its own common shares through an exchange agreement with its
            shareholder, and the Company subsequently changed its name to
            International Surfacing Inc. The Company, as previously restated,
            accounted for the loss on the acquisition as a reduction of paid-in
            capital; and the acquisition as a recapitalization.


                                       10
<PAGE>

                          INTERNATONAL SURFACING, INC.
                         (A DEVELOPMENTAL STAGE COMPANY)

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

Note 2 -    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: (continued)

            Description of Business: (continued)

            The Company has 20,000,000 shares of preferred stock authorized with
            a par value of $.0001 and 100,000,000 shares of common stock
            authorized with a par value of $.0001. None of the preferred shares
            have been issued.

            Equipment

            Equipment is recorded at cost, less accumulated depreciation.
            Depreciation expense is provided on the straight-line method, based
            upon estimated useful lives of 3 years. The costs of improvements on
            leased property are capitalized as leasehold improvements and are
            being amortized on the straight-line method over an estimated useful
            life of 3 years. The period of amortization will end in 2005. The
            company anticipates moving into a new facility within the next year.

            It is the Company's policy to account for routine maintenance and
            repairs as a charge to expense when incurred. Major replacements and
            improvements, when incurred, are capitalized. When assets are sold
            or retired, the related cost and accumulated depreciation are
            removed from the accounts and gains or losses from dispositions are
            credited or charged to income.

            Income Taxes

            The Company accounts for income taxes in accordance with the
            "liability method" of accounting for income taxes. Accordingly,
            deferred tax assets and liabilities are determined based on the
            difference between the financial statement and tax basis of assets
            and liabilities, using enacted tax rates in effect for the year in
            which the differences are expected to reverse. Current income taxes
            are based on the respective periods' taxable income for federal and
            state income tax reporting purposes.

            Estimates

            The preparation of financial statements in conformity with
            accounting principles generally accepted in the United States of
            America requires management to make estimates and assumptions that
            affect the reported amounts of assets and liabilities and disclosure
            of contingent assets and liabilities at the date of the financial
            statements and the reported amounts of revenues and expenses during
            the reporting period. Actual results could differ from those
            estimates.

            Fair Value of Financial Instruments

            Fair value estimates discussed herein are based upon certain market
            assumptions and pertinent information available to management. The
            respective carrying value of certain on-balance-sheet financial
            instruments approximated their fair values. These financial
            instruments included cash and loan receivables. Fair values were
            assumed to approximate carrying values for these financial
            instruments since they are short-term in nature.


                                       11
<PAGE>

                          INTERNATONAL SURFACING, INC.
                         (A DEVELOPMENTAL STAGE COMPANY)

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

Note 2 -    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: (continued)

            Stock Based Compensation

            The Company has adopted the fair value method of accounting for
            stock-based employee compensation in accordance with SFAS 123. The
            Company currently does not have a formal stock-based compensation
            plan for its employees.

Note 3 -    GOING CONCERN

            At June 30, 2005, the Company reported a stockholders' deficit of
            $503,878. The Company does have significant working capital
            requirements, which to date have been met through private sales of
            its equity. The Company will continue to need substantial infusions
            of capital, which it expects to continue to fund primarily from
            loans, or by a public offering of its equity or debt securities.

Note 4 -    RECENT ACCOUNTING PRONOUNCEMENTS

            In December 2004, the Financial Accounting Standards Board ("FASB")
            issued Statement of Financial Accounting Standards No. 123 (revised
            2004) (`FAS 123R") Share Based Payment. Statement FAS 123R
            supersedes APB Opinion No. 25, and its related implementation
            guidance. This statement establishes standards for the accounting
            for transactions in which an entity exchanges its equity instruments
            for goods and services. It also addresses transactions in which an
            entity incurs liabilities in exchange for goods and services that
            are based on the fair value of the entity's equity instruments or
            that may be settled by the issuance of those equity instruments. FAS
            123R focuses primarily on accounting for transactions in which an
            entity obtains employee services in share-based payment
            transactions. The Company will be considered a small business issuer
            for which, the implementation of FAS 123R is required as of the
            beginning of the first interim or annual reporting period after
            December 15, 2005. The Company is required to implement FAS 123R
            beginning in the fiscal year beginning January 1, 2006. The Company
            has implemented FAS 123R effective for the year ended December 31,
            2004.

Note 5 -    INVESTMENT IN UNAFFILIATED COMPANY:

            On October 11, 2004, the Company issued an aggregate of 1,500,000
            shares to three parties in consideration for shares of common stock
            in Innovative Cooling Enterprises Inc., an unaffiliated company. The
            shares were issued at par, and the investment was recorded on the
            accompanying financial statements.

            As of March 31, 2005, the three parties had failed to deliver the
            shares of Innovative Cooling Enterprises to the Company. In May
            2005, the three parties returned the 1,500,000 shares to the
            Company, and the Company subsequently canceled the shares on June 1,
            2005. The Company as of June 30, 2005 has reversed the investment in
            Innovative Cooling Enterprises.


                                       12
<PAGE>

                          INTERNATONAL SURFACING, INC.
                         (A DEVELOPMENTAL STAGE COMPANY)

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

Note 6 -    FIXED ASSETS:

            Fixed assets consisted of the following at:

                                                 June 30,           Dec. 31,
                                                   2005               2004
                                                ----------        ----------
            Office Equipment                    $   13,980        $    8,980
            Leasehold improvements                  12,789            12,789
                                                ----------        ----------
                                                    26,769            21,769

            Less accumulated depreciation          (12,895)          (10,012)
                                                ----------        ----------

                                                $   13,874        $   11,757
                                                ==========        ==========

            For the six months ended June 30, 2005, depreciation expense
            amounted to $2,883.

Note 7 -    RELATED PARTY TRANSACTIONS:

            The Company is currently operating with cash generated from the sale
            of its common stock or from funds loaned by its chief executive
            officer. Since the Company started operations, the chief executive
            officer has loaned the Company $783,792 on a non-interest bearing
            basis. The Company has repaid approximately $192,102, which has
            resulted in an outstanding balance of $591,690 at June 30, 2005.

            As of June 30, 2005, a director of the Company had loaned the
            Company the sum of $18,500 on a non-interest bearing basis, which is
            due on demand. This amount is reported in the accompanying financial
            statements under the caption "loans payable- other".

Note 8 -    COMMITMENTS:

            The Company leases its administrative facilities on a month-to-month
            basis. For the three months ended June 30, 2005 and June 30, 2004
            the Company's rent expense was $7,500 respectively.


                                       13
<PAGE>

                          INTERNATONAL SURFACING, INC.
                         (A DEVELOPMENTAL STAGE COMPANY)

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

Note 9 -    GENERAL AND ADMINISTRATIVE EXPENSES:

            General and administrative expenses were $211,017 in the six months
            ended June 30, 2005. For the six months ended June 30, 2004, general
            and administrative expenses were $134,060. Below is a comparative
            summary of general and administrative expenses:

                                                 June 30,    June 30,
                                                   2005        2004
                                                ----------  ----------
            Contracted services                 $   94,657  $   60,486
            Professional fees                       41,450      28,500
            Rent                                    15,000      15,000
            Travel                                  13,459       7,418
            Utilities                                2,837       2,525
            Other                                   43,614      20,131
                                                ----------  ----------
            Total general and administrative
              expenses                          $  211,017  $  134,060
                                                ==========  ==========

Note 10 -   LOSS PER SHARE:

            Loss per common share is computed pursuant to SFAS No. 128,
            "Earnings Per Share". Basic loss per share is computed as net loss
            available to common shareholders divided by the weighted average
            number of common shares outstanding for the period. Diluted loss per
            share reflects the potential dilution that could occur from common
            shares issuable through stock options, warrants and convertible
            preferred stock. For the three months ended June 30, 2005 and June
            30, 2004, there were no items of potential dilution that would
            impact on the computation of diluted loss per share.

Note 11 -   RESEARCH AND DEVELOPMENT:

            The Company is currently developing a new type of rubber horseshoe
            for the horse racing and equestrian industries. This product is
            currently in the developmental stage. The Company maintains a
            small-scale manufacturing facility adjacent to its executive
            offices, where the product is manufactured and tested. For the six
            months ended June 30, 2005 and June 30, 2004, the Company expended
            $6,903 and $17,301 respectively in research and development costs in
            developing this project. The cumulative developmental stage costs
            for this product were $302,850.


                                       14
<PAGE>

                          INTERNATONAL SURFACING, INC.
                         (A DEVELOPMENTAL STAGE COMPANY)

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

Note 12 -   STOCK BASED COMPENSATION

            The Company recorded $165,260 in compensation and consulting fees
            thru December 31, 2003. These amounts were not paid and were
            reflected as an accrued liability on prior years financial
            statements.

            In October 2004, The Company issued 1,000,000 shares to each of its
            two officers. This new issuance represented compensation for both
            the prior compensation referred to above as well as current
            compensatory services rendered to the Company in 2004. The shares
            issued were valued at $.25 per share, which represented the fair
            market value of the common stock. The effect of this issuance was
            that accrued expenses, representing the Company's liability for
            accrued compensatory services at December 31, 2003, were reduced by
            $88,000 and compensation expense of $412,000 was recorded in 2004.

Note 13 -   PUBLIC OFFERING OF COMMON STOCK:

            The Company has filed a registration statement on Form SB-2 for the
            resale of 5,749,730 shares of common stock presently outstanding and
            held by selling stockholders. The Company is currently awaiting
            approval of the filing by the Security and Exchange Commission.

Note 14 -   COMPENSATION AGREEMENT:

            In November 2004, the Company had entered into a compensation
            agreement with MDM Corporate Electronic Filers (MDM) whereas MDM
            will provide the Company with all EDGAR filing services. The
            agreement is valued at $12,000. The Company will issue MDM 60,000
            shares of its common stock in consideration for MDM's services. As
            of June 30, 2005 the Company had not yet issued the common stock to
            MDM.

Note 15 -  Restatement

           The accompanying balance sheet as of December 31, 2004 has been
           restated to properly reflect the issuance of 1,500,000 shares at par
           ($.0001) in relation to the investment in Innovative Cooling
           Enterprise Inc. referred to in Note 5.

           Additionally, the accompanying balance sheet as of December 31, 2004
           has also been restated to properly reflect the issuance of 1,500,000
           shares at par ($.0001) in consideration for professional services
           rendered.


                                       15
<PAGE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

Statements contained in this report, which are not historical facts, may be
considered forward-looking information with respect to plans, projections, or
future performance of the Company as defined under the Private Securities
litigation Reform Act of 1995. These forward-looking statements are subject to
risks and uncertainties, which could cause actual results to differ materially
from those projected. The words "anticipate", "believe", "estimate", "expect",
"objective", and "think" or similar expressions used herein are intended to
identify forward-looking statements. The forward-looking statements are based on
the Company's current views and assumptions and involve risks and uncertainties
that include, among other things, the effects of the Company's business, actions
of competitors, changes in laws and regulations, including accounting standards,
employee relations, customer demand, prices of purchased raw material and parts,
domestic economic conditions, including housing starts and changes in consumer
disposable income, and foreign economic conditions, including currency rate
fluctuations. Some or all of the facts are beyond the Company's control.

The following discussion and analysis should be read in conjunction with the
consolidated financial statements and related footnotes, which provide
additional information concerning the Company's financial activities and
condition.

CRITICAL ACCOUNTING POLICIES

Equipment

Equipment is recorded at cost, less accumulated depreciation. Depreciation
expense is provided on the straight-line method, based upon estimated useful
lives of 3 years. The costs of improvements on leased property are capitalized
as leasehold improvements and are being amortized on the straight-line basis
over an estimated useful life of 3 years. The period of amortization will end in
2005. The company anticipates moving into a new facility within the next year.

It is the Company's policy to account for routine maintenance and repairs as a
charge to expense when incurred. Major replacements and improvements when
incurred are capitalized. When assets are sold or retired, the related cost and
accumulated depreciation are removed from the accounts and gains or losses from
dispositions are credited or charged to income.

Income Taxes

The Company follows the asset and liability method of accounting for income
taxes. Deferred tax assets and liabilities are recognized for the estimated
future tax consequences attributable to differences between the financial
statements carrying amounts of existing assets and liabilities and their
respective tax bases. Deferred tax assets and liabilities are measured using
enacted tax rates expected to apply to taxable income in the years in which
those temporary differences are expected to be recovered or settled. The effect
on deferred tax assets and liabilities of a change in tax rates is recognized as
income in the period that included the enactment date. Deferred tax assets
resulting principally from operating losses have not been recognized.

Estimates

The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.


                                       16
<PAGE>

Fair Value of Financial Instruments

Fair value estimates discussed herein are based upon certain market assumptions
and pertinent information available to management. The respective carrying value
of certain on-balance-sheet financial instruments approximated their fair
values. These financial instruments included cash and loans receivable. Fair
values were assumed to approximate carrying values for these financial
instruments since they are short-term in nature or they were payable on demand.

Going Concern

At June 30, 2005, we reported a stockholders' deficit of $503,879 and we have
significant capital needs, which to date have been met through private sales of
its equity. The Company will continue to need substantial infusions of capital,
which we expect to continue to fund primarily from private sales of its equity
and loans, or by a public offering of its equity or debt securities.

PLAN OF OPERATIONS

We were founded to develop, manufacture, market and distribute unique rubber
horseshoes and related services. The founder of our company, Samuel Serritella,
recognized an opportunity to develop a product that we believe would take less
of a toll on the legs of horses as compared to conventional iron or aluminum
shoes. Our initial market is the horse racing industry; however, we believe our
product may be used on any type of horse. If the StealthShoe(TM) becomes
established in the horse racing industry, we intend to broaden our market to
include shoes for horses used in an urban setting, such as police horses and
carriage horses, shoes for therapeutic purposes for lame horses and shoes for
the general horse owner market.

After nearly three years of research and development by our founders, we have
tested StealthShoe(TM) product in actual racing conditions. We are moving to
increase our pool of research subjects to study the strength arid wear
characteristics of our product. Through our ongoing research and development, we
expect to continue to improve our products and eventually move into commercial
production. Currently, Sam Serritella and Gary Kouletas head our research and
development. We have set up a small scale manufacturing facility to produce our
product for testing purposes. This includes cutting and milling materials as
well as bonding our products. Through this process we have been able to test
adhesives and compare different aluminums and different steel as well as testing
different rubber samples.

We have entered a manufacturing and marketing agreement with Victory Racing
Plate Company (Victory), a company that has been involved in the horseshoe
industry for 75 years. However, we have not yet reached an agreement with
Victory regarding price and/or profit sharing in connection with our combined
manufacturing and marketing efforts. Together with Victory, we introduced the
Stealthshoe into the horseshoe market at the International Hoof Care Summit in
Cincinnati, Ohio on January 29, 2005. Soon, Victory will begin to market the
Stealthshoe to strategic parts of the country, beginning with the east coast.
These marketing efforts will include video marketing, print ads, attendance at
trade shows and consignment to various distributors. Under the arrangement we
have reached with Victory, upon receipt of a purchase order by Victory, Victory
shall provide us with an invoice for each of the aluminum horseshoes to be
manufactured. Upon payment of the invoice, Victory shall manufacture the
aluminum horseshoe and ship such horseshoes to our company where we will apply
the rubber base to the aluminum horsehoe using our proprietary process. We will
then forward the finished product to Victory for distribution. The customer will
then pay for the finished product. The division of the profit generated on each
horseshoe sold shall be determined on a case by case basis. We expect to incur
approximately $250,000 in costs in connection with marketing and production
(including the purchase of raw materials) during this period. We will utilize
Victory's established distribution channels.


                                       17
<PAGE>

Within the forthcoming year we plan, together with Victory to begin the
manufacturing of the steel substrate model to accommodate the police and
carriage horse market. We expect to incur costs related to marketing and
production (including the purchase of raw materials) of approximately $150,000.

Additionally, after we have introduced our product to the police and carriage
horse market, we will begin to market the shoe to other markets including the
pleasure horse and Amish horse markets. We expect to incur costs related to
marketing arid production (including the purchase of raw materials) of
approximately $150,000.

We expect these costs to be funded by sales of our common stock or debt
financing. Victory will be absorbing start up die costs.

We maintain a small-scale manufacturing facility adjacent to its executive
offices, where the product is manufactured and tested. For the six months ended
June 30, 2005, we expended $6,903 in research and development costs in
developing this project. For the three months ended June 30, 2004 research and
development costs were $17,301. The cumulative developmental stage costs for
this product were $302,850.

We have incurred net losses in the aggregate of $1,552,649 since our inception
though the six months ended June 30, 2005. The net loss for the six months ended
June 30, 2005 was $220,803. The net loss for the six months ended June 30, 2004
was $154,177. The net loss consists of general and administrative expenses,
research and development expenses, compensation expenses and depreciation and
amortization. Below is a comparative summary of general and administrative
expenses:

                                                   June 30,    June 30,
                                                     2005        2004
                                                  ----------  ----------
            Contracted services                   $   94,657  $   60,486
            Professional fees                         41,450      28,500
            Rent                                      15,000      15,000
            Travel                                    13,459       7,418
            Utilities                                  2,837       2,525
            Other                                     43,614      20,131
                                                  ----------  ----------
            Total general and administrative
              expenses                            $  211,017  $  134,060
                                                  ==========  ==========

To the extent that we are unable to secure additional external financing, and/or
generate cash revenue from operations, our ability to continue as a going
concern may be adversely affected.

We anticipate losses to continue because we expect to incur additional costs and
expenses related to:

      o     brand development which includes updating the design and engineering
            our horseshoe (estimated to be approximately $50,000);

      o     marketing and other promotional activities which includes attending
            trade shows, creating of pamphlets, displays and videos and media
            advertisements (estimated to be approximately $50,000);

      o     expansion of operations including the updating of office equipment
            and our R&D facility (estimated to be approximately $150,000);

      o     purchase of raw materials such as aluminum, rubber and adhesives
            (estimated to be approximately $500, 000) ; and

      o     monthly operating expenses which includes general operating
            equipment, professional fees and other administrative expenses
            (estimated to be approximately $250,000).


                                       18
<PAGE>

We do not expect to purchase or sell any plant or significant equipment and we
do not expect for there to be a significant change in the number of our
employees during the upcoming year.

Liquidity and Capital Resources

On June 30, 2005, we had cash resources of $253,22 with total current
liabilities of $776,425, including normal trade payables. Based on our existing
expenses, we expect to be able to continue our operations for two months and we
will need to raise approximately $1,000,000 in new capital to fund our
operations during the next year. We are currently operating using cash generated
from the sale of our common stock or from funds loaned by our Chief Executive
Officer.

Since we commenced operations in the horseshoe industry, Mr. Serritella, our
Chief Executive Officer, has loaned approximately $783,792 to our company to
fund our research and development and working capital. We have repaid Mr.
Serritella approximately $192,102, which has resulted in an outstanding balance
of $591,690 as of June 30, 2005. In addition, during the period from June 30,
2005 through July 15, 2005, Mr. Serritella loaned our company an additional
$237,500 to fund our research and development, working capital and costs related
to manufacturing and marketing. During this same period, we repaid Mr. Seritella
$43,744. These loans are non-interest bearing and are due on demand.

We expect to use the funds generated from future financings, if any, for the
purchase of raw materials, brand development, expansion of our operations and
general monthly expenses. This calculation is based on its average current
monthly expense level of approximately $20,000 per month.

We do not have any commitment from Mr. Serritella to engage in additional
financing. There can be no assurance that such additional funding whether from
third parties or Mr. Serritella will be available on terms acceptable to our
company, or at all. If adequate funds are not available on acceptable terms, we
may be unable to develop or enhance our products or take advantage of future
opportunities either of which could have a material adverse effect on our
business, results of operations and financial condition.

During the year ended December 31, 2002, we issued and sold convertible
debentures in the amount of $52,800, which were convertible into its common
stock at $.25 per share. Each of the debenture holders converted the debentures
into an aggregate of 211,200 shares of common stock.

From October 9, 2003 through October 11, 2004, we issued and sold shares of
common stock in the aggregate amount of $479,306 at $.25 per share, which
resulted in the issuance of 1,903,280 shares of common stock.

On October 11, 2004, we issued an aggregate of 1,500,000 shares to three parties
in consideration for shares of common stock in Innovative Cooling Enterprises,
Inc. The three parties did not deliver to us the shares of Innovative Cooling
Enterprises, Inc. As a result, in May 2005, the three parties returned the
1,500,000 shares we previously issued to us for cancellation.

On November 10, 2004, we issued and sold shares of common stock in the aggregate
amount of $20,000 at $.25 per share to two accredited investors, which resulted
in the issuance of an aggregate of 80,000 shares of common stock.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements that have or are reasonably likely to
have a current or future material effect on us.


                                       19
<PAGE>

Item 3. Controls and Procedures

As of the end of the period covered by this report, we conducted an evaluation,
under the supervision and with the participation of our chief executive officer
and chief financial officer of our disclosure controls and procedures (as
defined in Rule 13a-15(e) and Rule 15d-15(e) of the Exchange Act). Based upon
this evaluation, our chief executive officer and chief financial officer
concluded that our disclosure controls and procedures are effective to ensure
that information required to be disclosed by us in the reports that we file or
submit under the Exchange Act is recorded, processed, summarized and reported,
within the time periods specified in the Commission's rules and forms. There was
no change in our internal controls or in other factors that could affect these
controls during our last fiscal quarter that has materially affected, or is
reasonably likely to materially affect, our internal control over financial
reporting.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

From time to time, the Company may be a party to litigation or other legal
proceedings that it considers to be a part of the ordinary course of its
business. The Company is not involved currently in legal proceedings that could
reasonably be expected to have a material adverse effect on its business,
prospects, financial condition or results of operations. The Company may become
involved in material legal proceedings in the future.

Item 2. Changes in Securities.

On October 11, 2004, we issued an aggregate of 1,500,000 shares to three parties
in consideration for shares of common stock in Innovative Cooling Enterprises,
Inc. The three parties did not deliver to us the shares of Innovative Cooling
Enterprises, Inc. As a result, in May 2005, the three parties returned the
1,500,000 shares we previously issued to us for cancellation.

Item 3. Defaults Upon Senior Securities.

None

Item 4. Submission of Matters to a Vote of Security None Holders.

None

Item 5. Other Information.

None

Item 6. Exhibits

Exhibit
Number      Description
------      -----------
31.1        Certification of CEO and CFO Pursuant to Section 302 of the Sarbanes
            Oxley Act of 2002

32.1        Certification of CEO and CFO Pursuant to section 906 of the Sarbanes
            Oxley Act of 2002


                                       20
<PAGE>

                                   SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be signed in its
behalf by the undersigned, thereunto duly authorized, on August 16, 2005.

INTERNATIONAL SURFACING, INC.

By: /s/Samuel Serritella
    --------------------
    Samuel Serritella, CEO and CFO


                                       21