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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549





FORM 10-QSB/A



(Mark One)



[ X ]

QUARTERLY REPORT UNDER SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934



For the period ended September 30, 2003



[   ]

TRANSITION REPORT  UNDER SECTION 13 OR 15(d)

OF THE EXCHANGE ACT



For the transition period from ____________ to _____________





COMMISSION FILE NUMBER:   033-15096-D



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MILESTONE CAPITAL, INC.

(Exact name of small business issuer as specified in its charter)





COLORADO

84-1111224

(State or other jurisdiction of

(I.R.S. Employer

incorporation or organization)

Identification No.)



39 Plymouth Street

Fairfield, NJ  07004

(Address of principal executive offices)



(973) 808-5770

(Issuer's Telephone Number)





State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date:  As of September 30, 2003, the registrant had 82,077,000 shares of common stock, no par value, issued and outstanding.



Transitional Small Business Disclosure Format (check one): Yes [ ]  No [X]

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PART I  FINANCIAL INFORMATION



ITEM 1.

FINANCIAL STATEMENTS





Milestone Capital, Inc. and Subsidiaries



Condensed Consolidated Statements of Operations

Nine and Three Months Ended September 30, 2003 and 2002

(Unaudited)



Nine Months

Three Months

Ended September 30,

Ended September 30,

2003

2002

2003

2002



Revenue

Broker Fee Income

$   1,199,030

$       781,070

$       553,238

$     303,561

Loan Origination and Processing

1,296,934

714,220

20,675

340,424

Gain/Loss Sale of Mortgage

19,207

214,100

(4,332)

113,553

Other Revenue

2,426

42,008

15,269

14,422

Totals

2,517,597

1,751,398

584,850

771,960



Operating Expenses

Direct

864,053

577,784

43,658

262,273

General and Administrative

2,515,820

3,219,084

719,535

1,041,133

Interest

1,359

71,846

0

7,936

Totals

3,381,232

3,868,714

763,193

1,311,342



Loss From Operations

(863,635)

(2,177,316)

(178,343)

(539,382)

Other Interest Expense

141,987

221,840

47,329

76,464



Net Loss

$  (1,005,622)

$  (2,339,156)

$  (225,672)

$  (615,846)



Basic Loss Per Common Share

(0.01)

(0.03)

(0.00)

(0.01)



Basic Weighted Average Common

Shares Outstanding

82,077,000

80,649,513

82,077,000

81,539,912





#





Milestone Capital, Inc. and Subsidiaries



Condensed Consolidated Balance Sheet

September 30, 2003

(Unaudited)



ASSETS

Current Assets

Cash

$       17,388

Mortgage Loans Held for Sale

534,000

Prepaid Expenses and Other Receivables

172,547

Total Current Assets

723,935



Property and Equipment, Net

474,880

Deferred Acquisition costs

490,833

Other Assets

79,047

Total Assets

$ 1,768,695



LIABILITIES & STOCKHOLDERS DEFICIENCY

Liabilities  subject to compromise in the Bankruptcy

Current Liabilities

Borrowing Under Warehouse Line of Credit

$     534,000

Accounts Payable and Accrued Expenses

1,752,486

Notes Payable

430,591

Convertible Debt

275,000

Current Portion of Capital Lease Obligations

176,915

Total Current Liabilities

3,168,992



Capital Lease Obligations, Net of Current Portion

11,174

Other Liabilities

29,114

Total Liabilities

3,209,280



Shareholders Deficiency

Common Stock, no par value; 500,000,000 shares

authorized; 82,077,000 shares issued and outstanding

7,831,885

Additional paid-in capital

3,817,078

Accumulated deficit

(13,089,548)

Total Stockholders Deficiency

(1,440,585)



Totals

$ 1,768,695









#





Milestone Capital, Inc. and Subsidiaries



Condensed Consolidated Statements of Cash Flows

Nine Months Ended September 30, 2003 and 2002

(Unaudited)



2003

2002

Operating activities:

Net loss

$(1,005,622)

$(2,339,156)

Adjustments to reconcile net loss to net cash used in operating

activities:

Depreciation and amortization

227,107

292,327

Issuance of common stock to consultant in connection with reverse

acquisition

--

221,250

Forgiveness of current year salaries

96,582

266,665

Charges to interest expense associated with:

Beneficial conversion feature

--

169,600

Amortization of debt discount and deferred financing costs

35,400

81,288

Amortization of unearned compensation

--

136,635

Deferred acquisition costs

5,000

--

Issuance of shares in exchange for services

--

519,473

Changes in operating assets and liabilities:

Mortgage loans held for sale

(85,700)

705,636

Prepaid expenses and other receivables

(80,622)

24,435

Other assets

(20,301)

69

Borrowings under warehouse line of credit

85,700

(702,500)

Accounts payable and accrued expenses

510,882

217,654

Other liabilities

(7,278)

717



Net cash used in operating activities

(238,852)

(454,777)



Investing activities

Purchases of property and equipment

--

(48,017)

Deferred acquisition costs

--

(121,758)



Net cash used in investing activities

--

(169,775)



Financing activities:

Proceeds from issuance of convertible debentures

--

305,000

Payments of notes payable

(15,000)

(50,000)

Proceeds from notes payable

114,500

251,331

Payments under capital lease obligations

--

(76,065)

Net proceeds from sale of common stock

--

214,000



Net cash provided by financing activities

99,500

689,026

Net increase (decrease) in cash

(139,352)

64,474

Cash, beginning of period

156,740

6,257



Cash, end of period

$    17,388

$    70,731



Supplemental disclosure of noncash investing and financing activities:

Reversal of unearned compensation

$  329,028



Common stock related transactions:

Conversion of convertible debt and accrued interest thereon

into shares of common stock

$   645,346



Issuance of common stock in connection with convertible

debentures

$   210,878



Other noncash investing and financing activities:

Foregiveness of prior year salaries

$     41,667



Acquisition of property and equipment under capital lease obligations

$    59,034





See Notes to Condensed Consolidated Financial Statements.

#





Milestone Capital, Inc. and Subsidiaries



Notes to Condensed Consolidated Financial Statements

(Unaudited)



Note 1 - Organization and business:

Milestone Capital, Inc. ("Milestone") was organized under the laws of the State of Colorado in February 1987 under the name Shield Enterprises, Inc. In 1989, Milestone completed an initial public offering of its securities. In May 1990, Milestone merged with Milestone Capital, Inc., a Delaware corporation engaged in the business of investing in and providing managerial assistance to developing companies. Prior to January 3, 2002, Milestone was an inactive "shell company" that had no material business operations and virtually no assets.



On January 3, 2002, Milestone entered into an exchange agreement (the "Exchange") with EliteAgents Mortgage Services, Inc. (formerly EliteAgents, Inc.) ("Elite"), a licensed mortgage banker. As of January 3, 2002, Milestone had, effectively, 8,000,000 shares of no par common stock outstanding. As of that date, Milestone effectively issued 72,000,000 shares of common stock as follows: (i) 37,148,544 shares were issued for all of the outstanding shares of Elite common stock; (ii) 2,543,277 shares were issued for all of the outstanding shares of Elite Series A preferred stock; (iii) 14,445,832 shares were issued for all of the outstanding shares of Elite Series B preferred stock; (iv) 12,615,588 shares were issued for the effective conversion of outstanding Elite convertible debentures with a principal balance of $615,290 and accrued interest of $4,756 into Milestone common stock and (v) 5,246,759 shares were issued to other investors that had agreed to purchase shares of Elite common stock or had performed services for elite which were payable in shares of Elite common stock. As a result of the exchange, Elite became a wholly-owned subsidiary of Milestone, and Milestone had 80,000,000 shares of common stock outstanding of which 72,000,000, or 90%, were owned by the former stockholders of Elite and 8,000,000 shares, or 10%, were owned by the stockholders of Milestone. Since the former stockholders of Elite became the owners of the majority of the outstanding common shares of Milestone after the Exchange, the Exchange was treated as a "purchase business combination" and a "reverse acquisition" for accounting purposes in which Milestone was the legal acquirer and Elite was the accounting acquirer. As a result, the assets and liabilities of Elite, the accounting acquirer, continued to be recorded at their historical carrying values upon completion of the Exchange. All share and per share amounts set forth herein prior to the Exchange have been retroactively restated to reflect the effects of the Exchange.



Elite continued its mortgage banking activities and other financial services subsequent to the Exchange. It focused on mortgage loan originations through the uses of the internet and proprietary technology. In addition, effective May 8, 2002, Milestone formed a wholly-owned subsidiary, EliteAgents Leasing Services, Inc. ("Leasing"), for the purpose of establishing equipment financing and leasing operations. Leasing had not generated significant revenues as of September 30, 2003.



On September 26, 2003, Milestone Capital, Inc. (the Company) and its subsidiary, Elite Agents Mortgage Services, Inc. (formerly known as EliteAgents, Inc.) (collectively with the Company, the Debtors) filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy

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Milestone Capital, Inc. and Subsidiaries



Notes to Condensed Consolidated Financial Statements

(Unaudited)



Note 1 - Organization and business (contd):



Court for the District of New Jersey, in Newark (Case Nos. 03-41805 and 03-41806). In addition, the Debtors filed a motion pursuant to Rule 1015(b) of the Federal Rules of Bankruptcy procedure directing joint administration of the above-referenced cases.



The "Company" as used herein refers to Elite prior to January 3, 2002, the date of the Exchange and Milestone together with Elite and Leasing subsequent to that date.



In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments, consisting of normal recurring accruals, necessary to present fairly the financial position of the Company as of September 30, 2003, its results of operations for the nine and three months ended September 30, 2003 and 2002, its changes in stockholders' equity for the nine months ended September 30, 2003 and its cash flows for the six months ended September 30, 2003 and 2002. Pursuant to the rules and regulations of the United States Securities and Exchange Commission (the "SEC"), certain information and disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed in or omitted from these consolidated financial statements unless significant changes have taken place since the end of the most recent fiscal year. Accordingly, these unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements as of December 31, 2002 and for the year then ended and the notes thereto (the "Audited Financial Statements") and the other information included in the Company's Annual Report on Form 10-KSB for the year ended December 31, 2002 that was previously filed with the SEC.



The Companys liabilities are currently subject to compromise during the development of its Plan.



Note 2 - Basis of presentation and Going Concern:



The accompanying financial statements have been prepared on a going concern basis which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The Company has suffered material recurring losses from operations since inception.



On September 26, 2003, Milestone Capital, Inc. (the Company) and its subsidiary, Elite Agents Mortgage Services, Inc. (formerly known as Elite Agents, Inc.) (collectively with the Company, the Debtors) filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of New Jersey, in Newark (Case Nos. 03-41805 and 03-41806). In addition, the Debtors filed a motion pursuant to Rule 1015(b) of the Federal Rules of Bankruptcy procedure directing joint administration of the above-referenced cases.



#





Milestone Capital, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)



Note 2 - Basis of presentation and Going Concern (continued):



Use of 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 certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.



Revenue recognition: Nonrefundable mortgage application fees are recognized when received. Other loan origination and processing income and broker fee income is recognized when the loan closes. Gains on sales of loans to permanent investors are recognized when the loan has been sold and subsequently transferred to a permanent investor, generally upon the receipt of payment.



Concentrations of credit risk: Financial instruments that potentially subject the Company to concentrations of credit risk consists principally of cash and loans held for sale. Mortgage loans held for sale: Mortgage loans held for sale are carried at the lower of aggregate cost or market. Market value is determined by outstanding commitments from investors or current investor yield requirements. Property and equipment: Property and equipment are recorded at cost. Depreciation and amortization are computed on a straight-line basis over estimated useful lives ranging from three to seven years.



Software development costs: The Company accounts for costs incurred in connection with the development of software in accordance with Statement of Position 98-1, "Accounting for Costs of Computer Software Developed or Obtained for Internal Use." Accordingly, all costs incurred in the preliminary project stage are expensed as incurred, and internal and external costs incurred to develop internal use computer software during the application development stage are capitalized.



Impairment of long-lived assets: Impairment losses on long-lived assets with definitive lives, such as property and equipment, capitalized software and web site development costs, are recognized when events or changes in circumstances indicate that the undiscounted cash flows estimated to be generated by such assets are less than their carrying value and, accordingly, all or a portion of such carrying value may not be recoverable. Impairment losses are then measured by comparing the fair value of assets to their carrying amounts.



Advertising: The Company expenses the cost of advertising and promotions as incurred.

Stock options and warrants: In accordance with the provisions of Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees" ("APB 25"), the Company will only recognize compensation costs as a result of the issuance of stock options and warrants to employees based on the excess, if any, of the fair value of the underlying stock at the date of grant (or at an appropriate subsequent measurement date) over the amount the employee must pay to acquire the stock. Therefore, the Company will not be required to recognize compensation expense as a result of any grants of stock options and warrants to employees at an exercise price that is equal to or greater than fair value. The Company will also make pro forma disclosures, in accordance with the provisions of Statement of Financial Accounting



Milestone Capital, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)



Note 2 - Basis of presentation and Going Concern (continued):



Standards No. 123, "Accounting For Stock-Based Compensation" ("SFAS 123"), of net income or loss as if a fair value based method of accounting for stock options and warrants had been applied.

In accordance with SFAS 123, the Company will recognize the cost of preferred or common shares, options, warrants and other equity instruments issued to nonemployees as consideration for services as expense of the periods in which the related services are F-6rendered by a charge to compensation cost or another appropriate expense or prepaid expense account and a corresponding credit to additional paid-in capital. Generally, cost will be determined based on the fair value of the equity instruments at the date of issuance. The fair value of shares, options, warrants and similar equity instruments were estimated based on the minimum value method prior to the Exchange and the Black-Scholes option pricing method after the Exchange (which are methods that meet the criteria set forth in SFAS 123) and the assumption that all of the options or other equity instruments will ultimately vest. The effect of actual forfeitures will be recognized as they occur.



Income taxes: The Company accounts for income taxes pursuant to the asset and liability method which requires deferred income tax assets and liabilities to be computed annually for temporary differences between the financial statement and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Income tax expense is the tax payable or refundable for the period plus or minus the change during the period in deferred tax assets and liabilities.

Net earnings (loss) per common share: The Company presents "basic" earnings (loss) per common share and, if applicable, "diluted" earnings per common share pursuant to the provisions of Statement of Financial Accounting Standards No. 128, "Earnings per Share" ("SFAS 128"). Basic earnings (loss) per common share is calculated by dividing the income or loss applicable to common stock by the weighted average number of common shares outstanding during each period. The calculation of diluted earnings per common share is similar to that of basic earnings per common share, except that the income or loss applicable to common stock and the weighted average number of common shares outstanding during each period are adjusted for the effects of the assumed issuance of all potentially dilutive common shares, such as those issuable upon the exercise of options, warrants and the conversion of convertible debentures and preferred stock. earnings (loss) per common share (concluded): Diluted earnings per share amounts have not been presented in the accompanying consolidated statements of operations because the Company had net losses for both years and, accordingly, the assumed effects of the exercise of outstanding options and warrants and the application of the treasury stock method, the assumed effects of the conversion of outstanding convertible debentures, including any related adjustments to interest expense, and the assumed effects of the conversion of shares of preferred stock would have been anti-dilutive.





#





Milestone Capital, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)



Note 2 - Basis of presentation and Going Concern (continued):



Reclassifications: Certain prior year amounts in the accompanying financial statements have been reclassified to conform to the fiscal 2003 presentation.  In the current fiscal year, the operating results of the Company which filed for bankruptcy protection in September 2003, have been reclassified as discontinued operations for all periods presented.  See Note 9.



Note 3 - Net earnings (loss) per common share:



The Company presents "basic" earnings (loss) per common share and, if applicable, "diluted" earnings per common share pursuant to the provisions of Statement of Financial Accounting Standards No. 128, "Earnings Per Share". Basic earnings (loss) per common share is calculated by dividing income or loss applicable to common stock by the weighted average number of common shares outstanding during each period. As of September 30, 2003 and 2002, the Company had 20,049,560 and 30,406,977 of potentially dilutive securities.



Note 4 - Convertible debentures:



As of September 30, 2003, convertible debentures consist of notes that bear interest at 10%, can be converted at any time at the option of the holder or the Company into shares of the Company's common stock at $.20 per share and were initially scheduled to mature on March 1, 2003; however, the maturity date was extendable for six months at the discretion of the Company. During the six months ended June 30, 2003, the company exercised its right to extend the maturity date of the outstanding debentures until September 1, 2003 (see Note 9 to the Audited Financial Statements).



Note 5 - Stockholders' equity:



Stock option plan: 
Pursuant to the terms of the Exchange, the Company adopted Milestone's stock option plan. The exchange agreement further required the Board of Directors of the Company to ratify the plan within one year of the consummation of the Exchange. As the plan was never ratified, options to purchase 9,344,392 shares of the Company's common stock were effectively cancelled. As a result, during the nine months ended September 30, 2003, the Company reversed unearned compensation associated with such options totaling $329,028 (see Note 10 to the Audited Financial Statements).



Forgiveness of officer salaries:

During the six months ended June 30, 2003, officers of the Company forgave aggregate salaries of $96,582. Such amount was treated as a contribution to capital.  No salaries were forgiven to the subsequent three months ending September 30, 2003.





#





Milestone Capital, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)



Note 6 - Income taxes:



As of September 30, 2003, the Company had net operating loss carryforwards of approximately $9,700,000 available to reduce future Federal and state taxable income which, if not used, will expire at various dates through 2023. The Company had no other material temporary differences as of that date. Due to the uncertainties related to, among other things, the changes in the ownership of the Company, which could subject those loss carryforwards to substantial annual limitations, and the extent and timing of its future taxable income, if any, the Company offset the deferred tax assets attributable to the potential benefits of approximately $3,880,000 from the utilization of those net operating loss carryforwards by an equivalent valuation allowance as of June 30, 2003.



The Company had also offset the potential benefits of $3,157,000 from net operating loss carryforwards by an equivalent valuation allowance as of June 30, 2002. As a result of the increases in the valuation allowance of $151,000 and $206,000 during the six months ended June 30, 2003 and 2002, respectively, there are no credits for income taxes reflected in the accompanying consolidated statements of operations to offset pre-tax losses.



Due to certain limitations established by the internal revenue code, the amount of net operating loss carryforwards available for use in any one year is limited.



Note 7- Net worth requirements:



The Company is subject to various minimum net worth requirements pursuant to various state and HUD-imposed mandates as well as requirements from its permanent investors. As of July 1, 2003, the Company was required to maintain an adjusted minimum net worth of $250,000. As of September 30, 2003, the Company did not meet such minimum net worth requirements.



Note 8- Petition For Relief  Under Chapter 11:



On September 26, 2003, Milestone Capital, Inc. (the Company) and its subsidiary, Elite Agents Mortgage Services, Inc. (formerly known as EliteAgents, Inc.) (collectively with the Company, the Debtors) filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of New Jersey, in Newark (Case Nos. 03-41805 and 03-41806).  In addition, the Debtors filed a motion pursuant to Rule 1015(b) of the Federal Rules of Bankruptcy procedure directing joint administration of the above-referenced cases.Under Chapter 11, certain claims against the debtor in existence prior to the filing of the petitions for relief under the federal bankruptcy laws are stayed while the debtor continues business operations as debtor-in-possession.  Additional claims (liabilities subject to compromise) may arise subsequent to the filing date resulting from rejection of executory contracts, including leases, and from the determination by the court (or agreement to by parties in interest) of allowed claims for contingencies and other disputed amounts.  Claims secured against a debtors assets (secured

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Milestone Capital, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)











Note 8- Petition For Relief  Under Chapter 11 (contd):



claims) also are stayed, although the holders of such claims have the right to move the court for relief from the stay.  Secured claims are secured primarily by liens on a debtors property, plant, and equipment.





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ITEM 2.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS



CAUTIONARY STATEMENT FOR PURPOSES OF THE "SAFE HARBOR" PROVISIONS OF THE PRIVATE LITIGATION REFORM ACT OF 1995. Statements contained in this filing that are not based on historical fact, including without limitation statements containing the words "believe," "may," "will," "estimate," "continue," "anticipate," "intend," "expect" and similar words, constitute "forward-looking statements". These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, events or developments to be materially different from any future results, events or developments expressed or implied by such forward-looking statements. These factors include, among others, the following: general economic and business conditions, both nationally and in the regions in which Milestone Capital, Inc. ("we", "Milestone" or Company) operates; technology changes; the competition we face; changes in our business strategy or development plans; the high leverage of Milestone; our ability to attract and retain qualified personnel; existing governmental regulations and changes in, or our failure to comply with, governmental regulations; liability and other claims asserted against us; it's our ability or the ability of our third-party suppliers to take corrective action in a timely manner with respect to changing government regulations; and other factors referenced in our filings with the Securities and Exchange Commission.



Significant Events



NOTICE OF FILING OF BANKRUPTCY PETITION AND SALE OF OPERATING ASSETS on September 26, 2003, the company and its subsidiary, Elite Agents Mortgage Services, Inc. (formerly known as Elite Agents, Inc.) (collectively with the company), filed voluntary petitions for protection under Chapter 11 of the United States Bankruptcy code in the US Bankruptcy Court for the District of New Jersey, in Newark (Case Nos. 03-41805 and 03-41806).  Both companies filed a Motion pursuant to Rule 1015(b) of the Federal Rules of Bankruptcy procedure directing joint administration of the proceedings.  This allows the companies to continue to operate while a plan of reorganization is finalized.  We are pursuing the opportunity to acquire another mortgage company that has significant mortgage processor infrastructure in place.  We are also trying to evolve Milestone into a technology licensing company that would provide our software, for compensation, to other mortgage companies.  We further have ceased the origination of any new mortgage loans.  There are no assurances that either strategy will be successful, and we may be forced to close the company and sell the assets.  All discussions regarding the financial condition and results of operations should be read in conjunction with the pending Chapter 11 proceedings.  No funds were available for distribution to stockholders after all approved bankruptcy administration expenses were paid and distributions have been made to the Companys creditors whose claims exceeded the Companys potential resources from the sale of its operating assets and public shell.



GIVEN THESE UNCERTAINTIES, READERS ARE CAUTIONED NOT TO PLACE UNDUE RELIANCE ON FORWARD-LOOKING STATEMENTS. Other than as required by law, we disclaim any obligation to update information concerning the factors mentioned above or to publicly announce the result of any revisions to any of the forward-looking statements contained herein to reflect future results, events or developments.



CERTAIN DISCUSSIONS WHICH FOLLOW REGARDING THE DESCRIPTION OF BUSINESS REFER TO THE OPERATING BUSINESS PRIOR TO BEING DISCONTINUED DUE TO THE BANKRUPTCY.



Critical Accounting Policies and Estimates

Our discussion and analysis of our financial condition and results of operations are based upon our unaudited condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an on-going basis, we evaluate our estimates, including those related to property and equipment, stock based compensation, income taxes and contingencies. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.



#





Results of Operations



Based on the challenges we have experienced in hiring mortgage professionals; and in particular mortgage processors, during the boom period in the residential mortgage industry, Milestone has determined that our growth objectives can best be met through acquisitions of complementary companies or by becoming a software licensing firm.  We are pursuing both opportunities.



We generate revenue primarily from (i) loan origination and broker fees, (ii) net gain on the sale of mortgage loans in the secondary market and (iii) interest income received on mortgage loans during the period in which we warehouse loans pending their sale in the secondary market. Loan origination fees, net gain on the sale of mortgage loans and interest income are largely transaction oriented and volume driven.



We currently broker more than 95% of our loans to more than 20 lenders. We do not engage in the practice of servicing loans.  All of the loans funded by our warehouse line were sold out of the line within 30 days. The proceeds of the loans sold out of our warehouse line are used to repay the line of credit that originally funded the loans.



Our net loss from operations for the third quarter of fiscal year 2003 was ($225,672) compared to a net loss from operations of ($615,846) in the third quarter of fiscal 2002, a decrease of 81%. For the third quarter of fiscal year 2003, revenues decreased 18% to $584,850 from $771,960 in the third quarter of 2002. Total operating expenses decreased by 44% to ($763,193) for the third quarter of 2003 from ($1,311,342) in the third quarter of 2002. Our net loss from operations for the first nine months of fiscal year 2003 was ($863,635) compared to a net loss from operations of ($2,117,316) in the first nine months of fiscal 2002.  For the first nine months of fiscal year 2003, revenues increased to $2,517,597 from $1,751,398 in the first nine months of 2002. Total operating expenses decreased to ($3,381,232) for the first nine months of 2003 from ($3,868,714) in the first nine months of 2002.



Loan Origination and Broker Fee Income. We recognize fees from purchase mortgage loan originations at closing if the loan is brokered by us instead of warehoused by us. Loan origination income decreased to $573,913 in fiscal third quarter 2003 from $643,984 in fiscal third quarter 2002.  For the nine months ending September 30, 2003, loan origination income increased to $ 2,495,965 from $ 1,495,291 in the first nine months of 2002.  The primary factor that contributed significantly to the increase in revenue per loan we experienced during the third quarter of 2003 compared to the third quarter of 2002 was the better margins that we received from the lending institutions we utilized due to better relations with them and our improved understanding of which institutions provide better margins.



Gains on Sale of Mortgage Loans. When we warehouse loans, we seek to sell those loans in the secondary markets. Our gains and losses from the sale of mortgage loans are affected by several factors including (i) competitive market forces affecting our pricing structure at the time of origination, (ii) interest rate increases or decreases between the time that we commit to originate or purchase loans and the time that we commit to sell the loans in the secondary markets, (iii) price subsidies and (iv) the recognition of gains relating to originated mortgage servicing rights. Our net gain on the sales of mortgage loans from our loan warehousing operations was $19,207 for the first nine months of 2002.  We did not actively engage in the usage of our warehouse line due to staffing issues.



Total operating expenses decreased to ($3,381,232) for the first nine months of 2003 from ($3,868,714) in the first nine months of 2002. Direct expenses increased by to ($864,053) for the first nine months of 2003 from ($577,784) for the first nine months of 2002. General and administrative expenses decreased to ($2,515,820) for the first nine months of 2003 from ($3,219,084) for the first nine months of 2002.



The Company capitalized professional fees of $490,833 incurred in connection with the prospective acquisitions of three related entities in the mortgage banking industry discussed above.





Equipment Leasing



The subsidiary ceased operations in the third quarter due to an inability to place any lease transactions.



#





Income Taxes



We have incurred net operating losses since inception and, therefore, we have not incurred any income taxes. We have a net operating tax loss carry forward of approximately $9,700,000 as of June 30, 2003. However, due to certain limitations established by the Internal Revenue Code, the amount of net operating loss carry-forward available for use in any one year is limited.



Disclosure About Market Risk



We manage many risks in the normal course of business. However, we consider interest rate risk to be one of the most significant market risks that could materially impact our financial position and results of operations. The movements in interest rates affect the value of capitalized mortgage servicing rights, the mortgage inventory held for sale, volume of loan production and total net interest income earned.



Liquidity and Capital Resources



Milestone Capital is currently in Chapter 11 bankruptcy due to liquidity and capital resource issues.  We are pursuing the opportunity to acquire another mortgage company that has significant mortgage processor infrastructure in place.  We are also trying to evolve Milestone into a technology licensing company that would provide our software, for compensation, to other mortgage companies.  We further have ceased the origination of any new mortgage loans.  There are no assurances that either strategy will be successful and we may be forced to close the company and sell the assets.  The Company is currently soliciting potential acquirers of the various assets of the Company.



As of September 30, 2003, we had a cash balance of $17,388 and a working capital deficiency in excess of $2,200,000. We believe that we may continue to incur negative cash flows from operating activities for the foreseeable future.  There can be no assurance that we will be able to obtain additional capital on terms acceptable to us or complete the transactions previously discussed. See "Need for additional financing; uncertainty of additional financing" in the "Risk Factors" section of Milestone's Annual Report on Form 10-KSB filed on April 15, 2003, as amended by Milestone's Form 10-KSB/A filed on April 30, 2003.



Milestone has accrued significant accounts payable in connection with the negotiation of one of the proposed acquisitions, and in the event that we do not obtain the debt financing, our need to obtain alternative sources of financing in order to continue our ongoing business operations and satisfy our accounts payable will be increased.



Net cash used in operating activities was $238,852 for the nine months ended September 30, 2003, as compared to net cash used in operations of $454,777 for the nine months ended September 30, 2002. The decrease in net cash used in operating activities was primarily due to the reduction in the net operating loss during the nine months ended September 30, 2003, as compared to the nine months ended September 30, 2002.



During the first fiscal quarter of 2002, we engaged in two capital raising initiatives. In February 2002, we closed an offering of unregistered common stock of Milestone from which we raised $214,000 through the sale of 4,356,184 shares. The shares issued in this transaction were exempt from registration requirements pursuant to the exemption from registration contained in Rule 506 of Regulation D of the Securities Act of 1933 as amended to date.



On March 1, 2002, we initiated an offering of up to $1.15 million in unregistered convertible debentures to accredited investors. The convertible debentures bear interest at 10% per year and can be converted at any time at the option of the holder into shares of our unregistered common stock at $0.20 per share. The convertible debentures mature on September 1, 2003. In addition, holders of the convertible debentures receive one share of our unregistered common stock for each $1.00 of convertible debentures purchased. We closed this offering during the first quarter of 2002. We raised $350,000 from this offering. The notes and shares issued in this offering were exempt from registration requirements pursuant to the exemption from registration contained in Rule 506 of Regulation D of the Securities Act of 1933 as amended to date.



The proceeds of these raises have been used to fund operating expenses, increase advertising and marketing in the mortgage division, and launch the equipment leasing division. At various times during 2002, holders converted the debentures into 375,000 shares of the Company's common stock. The debentures that were converted had an aggregate principal balance of $75,000.



In September 2002 Milestone initiated a new private placement to raise capital to fund our due diligence costs and other  transaction costs associated with our pending acquisitions, to pay down certain accounts payable and to fund operating expenses. Milestone is offering up to 110,000 Units for $10 per Unit. Each Unit consists of (i) 50 shares of Milestone's unregistered common stock, (ii) a warrant exercisable for up to 25 shares of Milestone's unregistered common stock at an exercise price of $0.40 per share, and (iii) a warrant exercisable for up to 25 shares of Milestone's unregistered common stock at an exercise price of $0.60 per share. The Units will be offered solely to a limited number of accredited investors. The Units have not been registered under the Securities Act of 1933 as amended to date, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. From October 1, 2002 through November 4, 2002, Milestone had raised $145,000 from this offering, and the issued securities were exempt from registration requirements pursuant to the exemption from registration contained in Rule 506 of Regulation D of the Securities Act of 1933 as amended to date.



During 2002, the Company issued 905,575 shares of common stock of the Company in exchange for services. Of the 905,575 shares issued, 890,575 were issued to officers of the Company for the reimbursement of expenses of $43,750. All shares

issued to officers were issued through a private placement the Company was then offering to accredited investors. The securities issued in this transaction were exempt from registration requirements pursuant to the exemption from registration contained in Section 4(2) and Rule 506 of Regulation D of the Securities Act of 1933 as amended to date.



In addition, during 2002, the Company issued 271,250 shares of common stock with a fair value of $54,300 in exchange for general and administrative costs. The securities issued in this transaction were exempt from registration requirements

pursuant to the exemption from registration contained in Section 4(2) and Rule 506 of Regulation D of the Securities Act of 1933 as amended to date.



During 2002, certain officers of the Company advanced an aggregate of $221,000 to the Company to fund ongoing operations. The Company issued warrants to purchase 1,080,000 shares of the Company's common stock at an exercise price of $.20 per share that expire on September 30, 2007 in consideration for the provision by these officers of the funding. The securities issued in this transaction were exempt from registration requirements pursuant to the exemption from registration contained in Section 4(2) and Rule 506 of Regulation D of the Securities Act of 1933 as amended to date.





The Company maintains a warehouse line of credit with The Provident Bank. The warehouse line of credit is subject to quarterly review.



Inflation



Inflation may significantly affect our ability to originate loans. Interest rates typically increase during periods of high inflation and decrease during periods of low inflation. Generally, the mortgage banking industry, and in particular the refinance mortgage industry, has experienced increased origination volume in response to low interest rates, and loan originations, particularly refinance mortgage originations, have generally decreased during periods of high interest rates.



Special Cautionary Notice Regarding Forward-Looking Statements



In addition to historical information, this Quarterly Report on Form 10-QSB contains forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially. Factors that might cause or contribute to such differences include, but are not limited to, those discussed in "Management's Discussion and Analysis or Plan of Operation" as well as in this Quarterly Report generally. You should carefully review the risks described in this Quarterly Report as well as the risks described in our Annual Report on Form 10-KSB filed on April 15, 2003, as amended by our Form 10-KSB/A filed on

April 30, 2003. In addition, when used in this Quarterly Report, the words "anticipates," "plans," "believes," "intends," "estimates," and "expects" and similar expressions are generally intended to identify forward-looking statements. Such statements are subject to a number of risks and uncertainties. Our actual results, performance or achievements could differ materially from the results expressed in, or implied by these forward-looking statements or us. We undertake no obligation to revise these forward-looking statements to reflect any future events or circumstances.



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Cautionary Statements



We continue to be subject to certain factors that could cause our results to differ materially from expected and historical results. You should carefully review the risks described in this Quarterly Report as well as the risks described in our Annual Report on Form 10-KSB filed on April 15, 2003, as amended by our Form 10-KSB/A filed on April 30, 2003.



ITEM 3.

CONTROLS AND PROCEDURES



(a)  Evaluation of disclosure controls and procedures. As of the end of the period covered by this report, management including our principal executive officer and principal financial officer evaluated the effectiveness of the design and operation of our disclosure controls and procedures.  Based upon, and as of the date of that evaluation, our principal executive officer and principal financial officer concluded that, our disclosure controls and procedures effectively provided reasonable assurance that information required to be disclosed in the reports that we file or submit under the Securities and Exchange Act of 1934 are recorded, processed, summarized and reported within the time periods specified by the Securities and Exchange Commissions rules and forms.

(b)  Changes in internal controls.   The Company did not have the financial resources to retain our outside accounting firm to review our internal controls over financial reporting during the quarter ended September 30, 2003.  Management does not believe that has materially affected, or that is reasonably likely to materially affect, our internal control over financial reporting.



PART II - OTHER INFORMATION



ITEM 1.

LEGAL PROCEEDINGS



The Company is currently in Chapter 11 bankruptcy proceedings within the federal court system.  The Company is pursuing several strategies to exit from Chapter 11 as a solvent going concern; however, no assurances can be made that the Company will be successful.  The Company is also pursuing potential acquirers of the various assets of the Company as an alternative to any form of re-organization.



NOTICE OF FILING OF BANKRUPTCY PETITION AND SALE OF OPERATING ASSETS on September 26, 2003, the company and its subsidiary, Elite Agents Mortgage Services, Inc. (formerly known as Elite Agents, Inc.) (collectively with the company), filed voluntary petitions for protection under Chapter 11 of the United States Bankruptcy code in the US Bankruptcy Court for the District of New Jersey, in Newark (Case Nos. 03-41805 and 03-41806).  Both companies filed a Motion pursuant to Rule 1015(b) of the Federal Rules of Bankruptcy procedure directing joint administration of the proceedings.  This allows the companies to continue to operate while a plan of reorganization is finalized.  We are pursuing the opportunity to acquire another mortgage company that has significant mortgage processor infrastructure in place.  We are also trying to evolve Milestone into a technology licensing company that would provide our software, for compensation, to other mortgage companies.  We further have ceased the origination of any new mortgage loans.  There are no assurances that either strategy will be successful, and we may be forced to close the company and sell the assets.  All discussions regarding the financial condition and results of operations should be read in conjunction with the pending Chapter 11 proceedings.  No funds were available for distribution to stockholders after all approved bankruptcy administration expenses were paid and distributions have been made to the Companys creditors whose claims exceeded the Companys potential resources from the sale of its operating assets and public shell.



GIVEN THESE UNCERTAINTIES, READERS ARE CAUTIONED NOT TO PLACE UNDUE RELIANCE ON FORWARD-LOOKING STATEMENTS. Other than as required by law, we disclaim any obligation to update information concerning the factors mentioned above or to publicly announce the result of any revisions to any of the forward-looking statements contained herein to reflect future results, events or developments.



CERTAIN DISCUSSIONS WHICH FOLLOW REGARDING THE DESCRIPTION OF BUSINESS REFER TO THE OPERATING BUSINESS PRIOR TO BEING DISCONTINUED DUE TO THE BANKRUPTCY.





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ITEM 2.

CHANGES IN SECURITIES



During the first fiscal quarter of 2002, we engaged in two capital raising initiatives. In February 2002, we closed an offering of unregistered common stock of Milestone from which we raised $214,000 through the sale of 4,356,184 shares. The shares issued in this transaction were exempt from registration requirements pursuant to the exemption from registration contained in Rule 506of Regulation D of the Securities Act of 1933 as amended to date.



On March 1, 2002, we initiated an offering of up to $1.15 million in unregistered convertible debentures to accredited investors. The convertible debentures bear interest at 10% per year and can be converted at any time at the option of the holder into shares of our unregistered common stock at $0.20 per share. The convertible debentures mature on September 1, 2003. In addition, holders of the convertible debentures receive one share of our unregistered common stock for each $1.00 of convertible debentures purchased. We closed this offering during the first quarter of 2002. We raised $350,000 from this offering. The notes and shares issued in this offering were exempt from registration requirements pursuant to the exemption from registration contained in Rule 506 of Regulation D of the Securities Act of 1933 as amended to date. The proceeds of these raises have been used to fund operating expenses, increase advertising and marketing in the mortgage division, and launch the equipment

leasing division.



In September 2002 Milestone initiated a new private placement to raise capital to fund our due diligence costs and other transaction costs associated with our pending acquisitions, to pay down certain accounts payable and to fund operating expenses. Milestone is offering up to 110,000 Units for $10 per Unit. Each Unit consists of (i) 50 shares of Milestone's unregistered common stock, (ii) a warrant exercisable for up to 25 shares of Milestone's unregistered common stock at an exercise price of $0.40 per share, and (iii) a warrant exercisable for up to 25 shares of Milestone's unregistered common stock at an exercise price of $0.60 per share. The Units will be offered solely to a limited number of accredited investors. The Units have not been registered under the Securities Act of 1933 as amended to date, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. Through September 30, 2002, Milestone had not raised any proceeds from this offering. From October 1, 2002 through November 4, 2002, Milestone had raised $145,000 from this offering, and the issued securities were exempt from registration requirements pursuant to the exemption from registration contained in Rule 506 of Regulation D of the Securities Act of 1933 as amended to date.



In 2002, the Company issued 905,575 shares of common stock of the Company in exchange for services. Of the 905,575 shares issued, 890,575 were issued to officers of the Company for the reimbursement of expenses of $43,750. All shares issued to officers were issued through a private placement the Company was then offering to accredited investors. The securities issued in this transaction were exempt from registration requirements pursuant to the exemption from registration contained in Section 4(2) and Rule 506 of Regulation D of the Securities Act of 1933 as amended to date.



In addition, during 2002, the Company issued 271,250 shares of common stock with a fair value of $54,300 in exchange for general and administrative costs. The securities issued in this transaction were exempt from registration requirements pursuant to the exemption from registration contained in Section 4(2) and Rule 506 of Regulation D of the Securities Act of 1933 as amended to date.



During 2002, certain officers of the Company advanced an aggregate of $221,000 to the Company to fund ongoing operations. The Company issued warrants to purchase 1,080,000 shares of the Company's common stock at an exercise price of $.20 per share that expire on September 30, 2007 to two of these officers in consideration for the provision by these officers of the funding. The securities issued in this transaction were exempt from registration requirements pursuant to the exemption from registration contained in Section 4(2) and Rule 506 of Regulation D of the Securities Act of 1933 as amended to date.



ITEM 5.

OTHER INFORMATION



Consistent with Section 10A(i)(2) of the Securities Exchange Act of 1934, as added by Section 202 of the Sarbanes-Oxley Act of 2002, the Company is responsible for listing the non-audit services approved in the third quarter of 2003 by the Company's Board of Directors. Non-audit services are defined in the law as services other than those provided in connection with an audit or a review of the financial statements of the Company. The non-audit services approved by the Board of Directors in the third quarter of 2003 (see list below) are each considered by the Company to be other services.





ITEM 6.

EXHIBITS AND REPORTS ON FORM 8-K



(a) Exhibits



Exhibit 31.1  Certification of CEO pursuant to Section 302 of the Sarbanes-Oxley Act of  2002



Exhibit 31.2  Certification of CFO pursuant to Section 302 of the Sarbanes-Oxley Act of  2002



Exhibit 32.1  Certification of CEO pursuant to Section 906 of the Sarbanes-Oxley Act of  2002



Exhibit 32.2  Certification of CFO pursuant to Section 906 of the Sarbanes-Oxley Act of  2002



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SIGNATURES



In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.







MILESTONE CAPITAL, INC.



Date:  January 6, 2004

/s/   Charles J. DeMory

Charles J. DeMory, Chairman,

Chief Executive Officer and President





Date:  January 6, 2004

/s/   John Mangel III

John Mangel III, Chief Financial

Officer and Executive Vice President



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CERTIFICATIONS

Exhibit 31.1



Certification Pursuant to Rule 13a-14 or 15d-14 of the Securities Exchange Act of 1934, As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002



I, Charles J. DeMory, Chief Executive Officer of Milestone Capital, Inc., certify that:



1.

I have reviewed this Quarterly Report on Form 10-QSB of Milestone Capital, Inc.;



2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;



3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the issuer as of, and for, the periods presented in this report;



4.

The issuers other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the issuer and have:



(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;



(b) Evaluated the effectiveness of the issuers disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and



(c) Disclosed in this report any change in the issuers internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the issuers internal control over financial reporting; and



5.

The issuers other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the issuers auditors and the audit committee of the issuers board of directors (or persons performing the equivalent functions):



(a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the issuers ability to record, process, summarize and report financial information; and



(b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the issuers internal control over financial reporting.



Date:  January 6, 2004

/s/   Charles J. DeMory

Charles J. DeMory, Chief Executive

Officer and President

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Exhibit 31.2



Certification Pursuant to Rule 13a-14 or 15d-14 of the Securities Exchange Act of 1934, As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002



I, John Mangel III, Chief Financial Officer of Milestone Capital, Inc., certify that:



1.

I have reviewed this Quarterly Report on Form 10-QSB of Milestone Capital, Inc.;



2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;



3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the issuer as of, and for, the periods presented in this report;



4.

The issuers other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the issuer and have:



(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;



(b) Evaluated the effectiveness of the issuers disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and



(c) Disclosed in this report any change in the issuers internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the issuers internal control over financial reporting; and



5.

The issuers other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the issuers auditors and the audit committee of the issuers board of directors (or persons performing the equivalent functions):



(a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the issuers ability to record, process, summarize and report financial information; and



(b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the issuers internal control over financial reporting.



Date:  January 6, 2004

/s/   John Mangel III

John Mangel III, Chief Financial

Officer and Executive Vice President

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Exhibit 32.1



Certification pursuant to 18 U.S.C. Section 1350,

as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002



In connection with the Form 10-QSB of Milestone Capital, Inc. (the Company) for the quarter ended September 30, 2003, as filed with the Securities and Exchange Commission on the date hereof (the Report), each of the undersigned certifies, pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to the best of their knowledge and belief, that:



1)

the Report fully complies with the requirements of Sections 13(a) or 15(d) of the Securities and Exchange Act of 1934, as amended; and



1)

the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.



This certification is made solely for purpose of 18 U.S.C. § 1350 and not for any other purpose.  A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signatures that appear in typed form within the electronic version of this written statement required by Section 906, has been provided to Milestone Capital, Inc. and will be retained by Milestone Capital, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.



Date:  January 6, 2004

/s/   Charles J. DeMory

Charles J. DeMory, Chairman,

Chief Executive Officer and President



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Exhibit 32.2



Certification pursuant to 18 U.S.C. Section 1350,

as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002



In connection with the Form 10-QSB of Milestone Capital, Inc. (the Company) for the quarter ended September 30, 2003, as filed with the Securities and Exchange Commission on the date hereof (the Report), each of the undersigned certifies, pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to the best of their knowledge and belief, that:



1)

the Report fully complies with the requirements of Sections 13(a) or 15(d) of the Securities and Exchange Act of 1934, as amended; and



2)

the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.



This certification is made solely for purpose of 18 U.S.C. § 1350 and not for any other purpose.  A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signatures that appear in typed form within the electronic version of this written statement required by Section 906, has been provided to Milestone Capital, Inc. and will be retained by Milestone Capital, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.



Date:  January 6, 2004

/s/   John Mangel III

John Mangel III, Chief Financial

Officer and Executive Vice President



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