UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549

                                   FORM 10-KSB

 ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

                   For the fiscal year ended February 28, 2002


                             C and E Holdings, Inc.
                       (Name of Small Business Registrant)


        Nevada                       0-31163                   86-0984818
(State of Incorporation)     (Commission File Number)       (I.R.S. Employer
                                                          Identification Number)


                             2816 East Windrose Dr,
                              Phoenix,Arizona 85032
           (Address of Principal Executive Offices Including Zip Code)


                                 (602) 493 0369
                         (Registrants Telephone Number)


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

           Securities registered pursuant to Section 12(g) of the Act:

                          Common Stock $.001 par value
                                (Title of Class)

Check  whether  the  registrant  (1) filed all  reports  required to be filed by
Section  13 or 15(d) of the  Exchange  Act  during  the past 12 months  (or such
shorter period that the  registrant was required to file such reports),  and (2)
has been subject to filing requirements for the past 90 days. [X] YES [ ] NO

The registrant's revenues for its most recent fiscal year were $ 0

Number of  shares  outstanding  of each of the  registrant's  classes  of common
equity, (par value $.001) as of June 1, 2002 is 2,000,000.

The following documents are herein  incorporated by reference:  (1) Form 10SB12G
filed on July 26, 2000 and is  incorporated  in Part III 13(a) and a 10QSB filed
on October 16, 2000.

Transitional Small Business Disclosure Format: [ ] Yes [X] No
<PAGE>
                             C AND E HOLDINGS, INC.


                                      INDEX

                                                                            Page
                                                                            ----
PART I

ITEM 1.  DESCRIPTION OF BUSINESS                                              1
          BUSINESS DEVELOPMENT                                                1
          BUSINESS                                                            2
          PATENTS                                                             3

ITEM 2.  DESCRIPTION OF PROPERTY                                              4
ITEM 3.  LEGAL PROCEEDINGS                                                    4
ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS                  4

PART II

ITEM 5.  MARKET FOR REGISTRANTS COMMON EQUITY AND RELATED
         STOCKHOLDER MATTERS                                                  4
ITEM 6.  MANAGEMENT'S DISCUSSION AND PLAN OF OPERATION                        6
ITEM 7.  FINANCIAL STATEMENTS                                                 8
ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
         AND FINANCIAL MATTERS                                                8

PART III

ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
         COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT                    9
ITEM 10. EXECUTIVE COMPENSATION                                              10
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT      10
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS                      10
ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K                                    11

                                        i
<PAGE>
                                     PART I

ITEM 1. DESCRIPTION OF BUSINESS

BUSINESS DEVELOPMENT

C and E Holdings, Inc. was incorporated in The State of Nevada on March 7, 2000.
Its purpose is to engage in any lawful corporate activity, which includes
mergers and acquisitions. The registrant is in a development stage and has no
operations to date other than issuing of shares to the original shareholders. It
was formed to provide a method for a private domestic or foreign registrant to
become a public reporting registrant thereby causing their shares to be
qualified to trade in the domestic secondary markets.

There have been no bankruptcy, receivership or similar proceedings in the
registrant's history.

There are certain benefits to being a reporting registrant with a publicly
traded class of stock. They are perceived as follows:

     *    increased ability to raise capital

     *    enhanced visibility in the financial community particularly helpful to
          raise debt if needed

     *    presence in the capital markets of the United States

     *    ability to use registered securities to acquire other companies and or
          their assets

     *    improved competitive position

     *    increased corporate prestige

     *    key employees compensation through stock options

     *    shareholder liquidity and corporate valuation

An entity may be interested in merging with the registrant if it is interested
in using public securities to make acquisitions of other companies or one that
is interested in becoming public without substantial dilution of its stock.
Other targeted companies may be those which have not been able to locate an
underwriter with acceptable terms; one that feels it can raise capital on more
favorable terms as a public entity or a foreign registrant seeking entry into
the United States stock markets.

                                       1
<PAGE>
The registrant's business has numerous associated risks such as; competition, no
operating history, lack of any agreements with possible targeted companies,
management control, lack of market research, stock dilution, taxation, target
registrant's need for audited financial and possible computer problems.

The business of seeking mergers with other companies or acquiring other
companies is highly competitive. There are many large corporations and venture
capital firms that seek other entities with which to merge or acquire. These
corporations and venture capital firms are better financed than the registrant
and have more expertise in the field of mergers and acquisitions. The registrant
will not be a significant competitor in this field.

BUSINESS

The registrant is without an operating history. It has no revenue and limited
assets. The Registrant will in all likelihood operate at a loss and will be
unable to reverse that situation until a merger or acquisition occurs. There is
no targeted registrant nor any assurance the registrant will be able to close a
business transaction needed to reverse its anticipated losses.

The registrant has no current agreement with respect to a merger or acquisition
with a targeted registrant. There is no assurance that the Registrant will be
successful in its plan to merge or acquire another entity. There has been no
industry identification by management nor has there been a business model
established consisting of the required operating history, assets and revenues of
a target registrant. Therefore, the registrant may enter into an agreement,
which may result in a business combination with an entity without significant
operating history, revenues or assets precluding the potential for current
earnings or increased net worth.

The management of the registrant consists only of its officers and shareholders.
They will devote a portion of their time to the business of the Registrant
attempting to locate and close with a potential targeted registrant. There is
neither compensation paid nor an agreement to enter into such a contract in the
future. The loss of these individuals could adversely affect the Registrant's
development and its continued operations.

The Registrant has performed limited research in an attempt to determine whether
demand exists for these types of transactions. Even if further research
determines that the demand does in fact exist, there is no assurance that the
registrant will be able to conclude a transaction.

The successful conclusion of an acquisition or merger by the registrant will
probably result in the issuance of securities to the shareholders of the
targeted registrant. This transaction will cause, in all probability, the
shareholders of the targeted registrant gaining control of the registrant and a
change in the existing management.

                                       2
<PAGE>
It is the intention of the registrant to structure a transaction with a targeted
registrant to minimize the state and federal tax consequences as they apply to
both parties. There can be no assurance that all the statutory requirements can
be met in the proposed reorganization or that the parties will receive tax
benefits desired in a transfer of stock or assets.

The registrant will seek those companies, which have audited financial
statements or assure the registrant that said statements will be furnished
within sixty days of closing. If audited financial statements are not available
at closing, the registrant will require representations that the statements,
when audited, will not materially differ from the unaudited statements
presented. There are no assurances that a viable candidate for merger will agree
with the registrant's request, which would result in the failure of the
transaction to close.

The registrant does not believe it could be subject to regulation under the
Investment Company Act of 1940, because it will not be engaged in the business
of investing or trading securities. However, if the registrant engages in
operations which result in it holding passive investments in more than one other
company, in could be subject to the regulations found in the Investment Company
Act of 1940 and it would have to register under said act which could result in
significant registration and compliance costs.

The registrant has no full time employees. The president of the registrant will
devote a portion of his time to the activities of the registrant without
compensation.

The registrant will send an annual report to its security holders, which shall
contain audited financial statements. The registrant is electronically filing
this Form 10-KSB with the Securities Exchange Commission, to comply with the
reporting requirements as promulgated by the commission. As such, the Registrant
will advise the shareholders that the SEC maintains an Internet site that
contains reports, proxy and information statements, and other information
regarding registrants that file electronically with the SEC at
http://www.sec.gov.

PATENTS

The Registrant does not own, nor has it applied for any Patents.

                                       3
<PAGE>
ITEM 2. DESCRIPTION OF PROPERTY

The registrant is housed in the offices of one of its principal shareholders, at
2816 East Windrose Drive, Phoenix, Arizona 85032. Rent is not being charged to
the registrant. The registrant owns no real property and has no plans to acquire
real property.

At this time, the registrant has no policy in terms of investment in real estate
nor does it have any investment in real estate. The registrant has no immediate
plans to invest in real estate mortgages.

ITEM 3. LEGAL PROCEEDINGS

The registrant is not a party to any litigation and to its knowledge, no action,
suit or proceedings against it has been threatened by any person or entity.

ITEM 4. SUBMISSIONS OF MATTERS TO A VOTE OF SECURITY HOLDERS

There have been no matters submitted to the security holders during this fiscal
year.

                                     PART II

ITEM 5. MARKET FOR REGISTRANTS COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

There is no public trading market for the common equity and there has been no
trading to date. Furthermore, there is no assurance that a public trading market
will ever be established.

The registrant's securities meet the definition of "penny stock" as found in
Rule 3a51-1 of the Securities Exchange Act of 1934. The Securities and Exchange
Commission has adopted Rule 15g-9 which established sales practice requirements
for certain low price securities ("penny stock"). Unless the transaction is
exempt, it shall be unlawful for a broker or dealer to sell a penny stock to, or
to effect the purchase of a penny stock by, any person unless prior to the
transaction: (i) The broker or dealer has approved the person's account for
transactions in penny stocks pursuant to this rule and (ii) the broker or dealer
has received from the person a written agreement to the transaction setting
forth the identity and quantity of the penny stock to be purchased. In order to
approve a person's account for transactions in penny stock the broker or dealer
must: (a) obtain from the person information concerning the person's financial
situation, investment experience, and investment objectives; (b) reasonably
determine that transactions in penny stocks are suitable for that person, and
that the person has sufficient knowledge and experience in financial matters
that the person reasonably may be expected to be capable of evaluating the risks
of transactions in penny stocks; (c) deliver to the person a written statement

                                       4
<PAGE>
setting forth the basis on which the broker or dealer made the determination (i)
stating in a highlighted format that it is unlawful for the broker or dealer to
affect a transaction in penny stock unless the broker or dealer has received,
prior to the transaction, a written agreement to the transaction from the
person; and (ii) stating in a highlighted format immediately preceding the
customer signature line that (iii) the broker or dealer is required to provide
the person with the written statement; and (iv) the person should not sign and
return the written statement to the broker or dealer if it does not accurately
reflect the person's financial situation, investment experience, and investment
objectives; and (d) receive from the person a manually signed and dated copy of
the written statement. It is also required that disclosure be made as to the
risks of investing in penny stocks and the commissions payable to the broker-
dealer, as well as current price quotations and the remedies and rights
available in cases of fraud in penny stock transactions. Statements, on a
monthly basis must be sent to the investor listing recent prices for the penny
stock and information on the limited market.

It is the registrant's intention to merge or acquire a registrant, which would
qualify it to be listed on the NASDAQ SmallCap Market. The initial listing
requirements are as follows: (1) net tangible assets of $4,000,000 or market
capitalization of $50,000,000 or net income in latest fiscal year or two of the
last three fiscal years of $750,000, (2) public float 1,000,000 shares with a
market value of $5,000,000, (3) minimum bid price of $4.00, (4) three market
makers, (5) 300 round lot (100 or more shares) shareholders, (6) an operating
history of one year or $50,000,000 market cap, and (7) corporate governance
standards must be in place. Subsequent to qualifying for listing the registrant,
in order to remain on the SmallCap Market, the registrant must maintain the
following; (1) net tangible assets of $2,000,000 or market capitalization of
$35,000,000 or net income in latest fiscal year or two of the last three fiscal
years of $500,000, (2) public float 500,000 shares with a market value of
$1,000,000, (3) minimum bid price of $1.00, (4) two market makers, (5) 300 round
lot (100 or more shares) shareholders, and (6) corporate governance standards
must be in place.

The registrant may not qualify for the SmallCap market after a merger or
acquisition. In that case it's securities may be traded on the Over The Counter
Bulletin Board (OTCBB). This exchange differs from NASDAQ in that the
qualifications do not include minimum assets, revenues, number of shareholders,
market capitalization, number of shares in the public float and corporate
governance standards. To qualify for OTCBB the registrant must have a market
maker willing to list the securities on a bid and ask quotation and sponsor the
registrant for listing. All companies, including banks and insurance companies,
traded on the OTCBB must be fully reporting as of June 2000. The registrant may
also offer its securities on the National Quotation Bureau, Inc., commonly known
as the "pink sheets".

It is the registrant's objective to become qualified for NASDAQ SmallCap
however; there is no assurance it will reach or maintain that objective. The
registrant may, after a merger or acquisition, commence trading on the OTC BB.

                                       5
<PAGE>
HOLDERS. There are two (2) holders of the common equity of the registrant at its
year-end.

DIVIDENDS. There have been no cash dividends declared to date and there are no
plans to do so. There are no restrictions that limit the ability to pay
dividends on common equity other than the dependency on the registrant's
revenues, earnings and financial condition.

ITEM 6. MANAGEMENT'S PLAN OF OPERATION

During the next twelve months the registrant intended to locate, analyze,
acquire or merge with a targeted registrant. At this time, the registrant has
been involved in preliminary negotiations with a registrant regarding the
possibility of an acquisition or merger. The registrant will continue to solicit
targeted companies through the utilization of contacts in business and
professional communities. The registrant intends to solicit directly or may
engage consultants or advisors to assist it in reaching its objective. Payment
will be made to these consultants and advisors if a successful acquisition or
merger occurs because of their efforts. The payment may consist of cash or some
stock in the surviving entity or a combination of both.

The satisfaction of the registrant's cash requirements for the next twelve
months will be met in that the registrant's principal shareholders, have agreed
to advance to the Registrant the additional funds needed for operations and
those amounts designated for costs associated with a search for and completion
of an acquisition. The principal shareholders have no expectation of
reimbursement of advanced costs unless the new owners of the Registrant decide
to pay all or a portion thereof. A limit as to the minimum or maximum amounts
advanced by the principal shareholders has not been set. The registrant will not
borrow funds to pay management, agents, consultants, advisors or promoters. The
Registrant will not merge with, acquire or purchase assets of an entity in which
the Registrant's officers, directors or shareholders or any affiliate or agent
hold an equity position or is an officer or director.

The Registrant's business plan is to locate certain companies that may wish to
merge with the registrant in some fashion. This targeted registrant would desire
the perceived advantages of a merger with a public, reporting registrant. The
perceived advantages may enhance the registrant's ability to attract investment,
utilize securities for acquisition, provide liquidity and numerous other
benefits. No particular industry has been identified nor is this search confined
to a specific geographical area. It is not anticipated by management that the
Registrant will be able to participate in any more than one merger because of
its limited assets and resources.

                                       6
<PAGE>
The registrant may merge or acquire a registrant in early stage development
needing additional capital to launch new products, increase marketing or improve
quality. The utilization of the public market may be beneficial in raising the
required capital.

The registrant does not have nor will it acquire capital to supply targeted
companies. It is the position of management that it can present to the candidate
the opportunity to acquire controlling interest in a public registrant without
the substantial costs, both in time and money, of an initial public offering.
Management has performed only limited research in this area.

The officers and directors of the registrant will undertake the responsibility
of finding and analyzing new business opportunities. They will perform this task
individually and possibly with the help of other consultants and agents. The
agents or consultants will not receive a cash fee from the registrant said fee
will have to be assumed by the target registrant. The officer is experienced in
the analysis of companies and will be able to determine the existence of the
primary requirements of a good business structure consisting of financial,
management, products, distribution, need for further research and development,
growth potential and other material requirements. The registrant will have total
discretion in determining the type of registrant best suited for a business
combination.

The registrant will be subject to all the reporting requirements of the
Securities Exchange Act. Said Act requires, among other things, that a reporting
registrant file its audited financial statements. The registrant will not merge
or acquire a registrant that does not have or will not have audited financials
within a reasonable period of time, to meet the requirements of the Exchange
Act. If the merger candidate is unable to produce audited financial statements
within sixty days from the filing of the 8 K announcing the consummation of the
merger or said financial statements fail to comply with the Exchange Act, the
closing documents will provide for the dissolution of the transaction.

A target registrant may want to establish a public trading market for its
securities. It may desire to avoid what it perceives to be an adverse
consequence of undertaking its own public offering. It is possible to meet this
objective by entering into a transaction with the registrant. The adverse
consequences may be perceived to be, loss of control, substantial expense and
loss of time attempting to conclude an underwriting or the inability to retain
an underwriter with acceptable terms

A business candidate may have pre-existing agreements with outside advisors,
attorneys and accountants and the continuation of those agreements may be
required before the candidate will agree to close a transaction with the
registrant. These existing agreements may be a factor in the determination by
the registrant to go forward.

                                       7
<PAGE>
The conclusion of a business transaction will most likely result in the present
shareholders no longer being in control of the registrant. Management of the
registrant probably will not have the expertise in the business of the new
entity, which will result in the resignation of the present management.

The acquisition or merger usually results in the issuance of restricted
securities as consideration. If the negotiations resulted in the requirement for
registered securities to be issued, the surviving registrant would have to bear
the burden of registering the shares. There can be no assurance that that these
newly registered shares would be sold into the market depressing the market
value.

A merger with another registrant will significantly dilute the percentage of
ownership the present shareholders now enjoy. The amount of dilution will depend
on the number of shares issued which in turn could depend on the assets and
liabilities of the merging registrant. This is not to say that other factors may
not enter into this determination.

ITEM 7. FINANCIAL STATEMENTS

The Financial Statement of the registrant are filed as a part of this Annual
Report. See index to the financial statements on Page F-1.

ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
        FINANCIAL MATTERS

There have been no changes of Accountants or disagreements with the registrants
Accountants on accounting and financial matters.

                                       8
<PAGE>
                                    PART III

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE
        WITH SECTION 16(a) OF THE EXCHANGE ACT

The issuer has two officers and directors.

          Name                   Age           Positions and Offices Held
          ----                   ---           --------------------------
     Carl P. Ranno                62            President and Director
     Edward A. Barth              44            Secretary and Director

There are no agreements that a Director will resign at the request of another
person and the above named Directors are not acting on behalf of nor will act on
behalf of another person.

The following is a brief summary of the Directors and Officers including their
business experiences for the past five years.

Carl P. Ranno received a degree in Economics from Xavier University in
Cincinnati, OH and his Juris Doctor from the University of Detroit School of
Law. Mr. Ranno spent many years in the practice of law, which included the
fields of litigation as well as mergers and acquisitions. He maintains his
license to practice law in the State of Michigan and is admitted to practice in
the state and federal courts located in Michigan, the Sixth Circuit Court of
Appeals, the US Tax Court and the US Supreme Court. Mr. Ranno advises companies
as to legal issues and as well as strategic planning and mergers and
acquisitions.

From 1992 to 1996 he was the president of Pollution Controls International Corp.
which marketed and manufactured a patented after market automotive environmental
product. The operating subsidiary was voluntarily placed in Bankruptcy in 1996.
Ultimately, the parent merged with another company and Mr. Ranno has no further
contact with it.

Mr. Barth received a Bachelor of Science degree in civil engineering technology
from Youngstown State University. He has been employed by the City of North
Canton, Ohio as well as the Michael Baker Engineering Corporation. In 1990 he
returned to his family's construction business where he served as President of
Barth Construction Co., Inc. In August of 2001, Mr. Barth changed the name of
the corporation to Stark Concrete Leveling, Inc. Mr. Barth is a member of the
National Institute of Engineering Technologies and American Society of Certified
Engineering Technicians.

                                       9
<PAGE>
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

The Officers, Directors and those beneficially owning more than 10% of small
business registrant's class of equity securities registered under Section 12 of
the Exchange Act, shall file reports of ownership and any change in ownership
with the Securities and Exchange Commission. Copies of these reports are to be
filed with the registrant. There has been no change of ownership.

Based upon a review of these reports the registrant has concluded that Forms 13
D has been prepared.

ITEM 10. EXECUTIVE COMPENSATION

The registrant's officers and directors do not and have not received
compensation for services rendered to the registrant nor has any compensation
been accrued. They will not participate in any finders' fees. However, they will
receive some benefits as a beneficial owner of the registrant upon a merger or
acquisition taking place. Furthermore, there are no stock option plans, pension
plans, insurance coverage or other benefit programs adopted by the registrant.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth each person known by the Company to be the
beneficial owner of more than 5% of the Common Shares (the only class of voting
securities) of the Company all directors individually and all directors and
officers of the Company as a group. Each person has sole voting and investment
power with respect to the shares as indicated.

        Name and Address              Amount of Beneficial       Percentage
       of Beneficial Owner                 Ownership              of Class
       -------------------                 ---------              --------

      Carl P. Ranno                        1,000,000                50.0%
      2816  East Windrose Dr
      Phoenix, AZ 85032

      Edward A. Barth                      1,000,000                50.0%
      5046 East Blvd. N. W.
      Canton, OH 44718

      All Executive Officers and           2,000,000               100.0%
       Directors as a Group (2persons)

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

There are no parents of this small business registrant.

There are and have been no transactions with promoters.

                                       10
<PAGE>
There were no material underwriting discounts and commissions upon the sale of
securities by the registrant where any of the specified persons was or is to be
a principal underwriter or is a controlling person or member of a firm that was
or is to be a principal underwriter.

There were no transactions involving the purchase or sale of assets other than
in the ordinary course of business.

ITEMS 13. EXHIBITS AND REPORTS ON FORM 8-K

     (a)  Exhibits

          3.1  Articles of Incorporation with Amendments filed with the Form
               10SB on July 26, 2000 and incorporated by reference

          3.2  By Laws filed with the Form 10SB on July 26, 2000 and
               incorporated by reference

          3.3  Computation of per share earnings filed with Form 10SB on July
               26, 2000 and incorporated by reference and in current financial
               statements.

     (b) Reports on Form 8-K

         None

                                   SIGNATURES

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

                                      C AND E HOLDINGS, INC..


June 3, 2002                        By /s/ Carl P. Ranno
                                       ---------------------------------------
                                       Carl P. Ranno, President and Director


                                    By /s/ Edward A. Barth
                                       ---------------------------------------
                                       Edward A. Barth, Secretary and Director

                                       11
<PAGE>
                             C AND E HOLDINGS, INC.

                              FINANCIAL STATEMENTS

               FOR THE YEAR ENDED FEBRUARY 28, 2002 AND THE PERIOD

         BEGINNING MARCH 7, 2000 (INCEPTION) AND ENDED FEBRUARY 28, 2001


                                      F-1
<PAGE>
                          INDEPENDENT AUDITORS' REPORT


To the Stockholders
C and E Holdings, Inc.
Phoenix, Arizona

We have audited the accompanying balance sheets of C and E Holdings, Inc. as of
February 28, 2002 and 2001 and the related statements of income (loss),
stockholders' equity (deficit), and cash flows for the year ended February 28,
2002 and the period beginning March 7, 2000 (inception) and ended February 28,
2001. These financial statements are the responsibility of the company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.

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

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of C and E Holdings, Inc. as of
February 28, 2002 and 2001 and the results of its operations and its cash flows
for the year ended February 28, 2002 and the period beginning March 7, 2000
(inception) and ended February 28, 2001 in conformity with accounting principles
generally accepted in the United States of America.


                                      /s/ Hobe & Lucas CPA's, Inc.

Independence, Ohio
May 29, 2002

                                      F-2
<PAGE>
                             C AND E HOLDINGS, INC.
                                 BALANCE SHEETS


<TABLE>
<CAPTION>
                                                                     February 28,     February 28,
                                                                         2002             2001
                                                                       --------         --------
<S>                                                                    <C>              <C>
                                     ASSETS
Current Asset
  Cash                                                                 $      0         $    286
                                                                       --------         --------

       Total Assets                                                    $      0         $    286
                                                                       ========         ========

                 LIABILITIES AND STOCKHOLDERS= EQUITY (DEFICIT)

Liabilities
  Accounts payable                                                     $  5,890         $      0
                                                                       --------         --------

       Total Liabilities                                                  5,890                0
                                                                       --------         --------
Stockholders' Equity
  Preferred stock - 10,000,000 shares authorized, zero
   shares issued and outstanding, $.001 par value                             0                0
  Common stock - 100,000,000 shares authorized, 2,000,000
   shares issued and outstanding, $.001 par value                         2,000            2,000
  Additional paid-in capital                                              4,254            4,254
  Retained (deficit)                                                    (12,144)          (5,968)
                                                                       --------         --------

       Total Stockholders' Equity (Deficit)                              (5,890)             286
                                                                       --------         --------

       Total Liabilities and Stockholders' Equity (Deficit)            $      0         $    286
                                                                       ========         ========
</TABLE>

                 See accompanying notes to financial statements.

                                      F-3
<PAGE>
                             C AND E HOLDINGS, INC.
                           STATEMENTS OF INCOME (LOSS)
                  FOR THE YEAR ENDED FEBRUARY 28, 2002 AND THE
              PERIOD BEGINNING MARCH 7, 2000 (INCEPTION) AND ENDED
                                FEBRUARY 28, 2001


                                                         2002             2001
                                                       -------          -------
General and Administrative Expenses
  Bank service charges                                 $    46          $   108
  Licenses and fees                                        240              293
  Organization and legal costs                               0            5,253
  Accounting fees                                        5,890                0
  Office expenses                                            0              314
                                                       -------          -------
                                                         6,176            5,968
                                                       -------          -------


(Loss) before provision for income taxes                (6,176)          (5,968)

Provision for income taxes                                   0                0
                                                       -------          -------

Net (Loss)                                             $(6,176)         $(5,968)
                                                       =======          =======

Net (Loss) per common share - Basic                    $  (.00)         $  (.00)
                                                       =======          =======

                 See accompanying notes to financial statements.

                                      F-4
<PAGE>
                             C AND E HOLDINGS, INC.
                   STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)
               FOR THE PERIOD BEGINNING MARCH 7, 2000 (INCEPTION)
                 AND ENDED FEBRUARY 28, 2001, AND THE YEAR ENDED
                                FEBRUARY 28, 2002

<TABLE>
<CAPTION>
                                        Common Stock
                                   -----------------------     Additional                        Total
                                   Issued                        Paid-in      Accumulated     Stockholders'
                                   Shares        Par Value       Capital        Deficit         Equity
                                   ------        ---------       -------        -------         ------
<S>                               <C>              <C>           <C>           <C>              <C>
Issuance of Common Stock          2,000,000        $2,000        $4,254        $      0         $ 6,254

Net (Loss)                                                                       (5,968)         (5,968)
                                  ---------        ------        ------        --------         -------

Balance, February 28, 2001        2,000,000         2,000         4,254          (5,968)            286

Net (Loss)                                                                       (6,176)         (6,176)
                                  ---------        ------        ------        --------         -------

Balance, February 28, 2002        2,000,000        $2,000        $4,254        $(12,144)        $(5,890)
                                  =========        ======        ======        ========         =======
</TABLE>

                 See accompanying notes to financial statements.

                                      F-5
<PAGE>
                             C AND E HOLDINGS, INC.
                             STATEMENT OF CASH FLOWS
                      FOR THE YEAR ENDED FEBRUARY 28, 2002
                     AND THE PERIOD BEGINNING MARCH 7, 2000
                     (INCEPTION) AND ENDED FEBRUARY 28, 2001


                                                          2002            2001
                                                        -------         -------
Cash Flows From Operating Activities
  Net income (loss)                                     $(6,176)        $(5,968)
  Increase in accounts payable                            5,890               0
  Non-cash operating expenses                                 0           3,127
                                                        -------         -------

Net Cash Used in Operating Activities                      (286)         (2,841)

Cash Flows from Financing Activities
  Proceeds from issuance of common stock                      0           3,127
                                                        -------         -------

Net Increase (Decrease) in Cash                            (286)            286

Cash - Beginning of Period                                  286               0
                                                        -------         -------

Cash - End of Period                                    $     0         $   286
                                                        =======         =======
Supplemental Disclosure of Cash Flows Information:
  Interest paid                                         $     0         $     0
                                                        =======         =======
  Taxes paid                                            $     0         $     0
                                                        =======         =======

Supplemental Disclosure of Non-Cash Investing and Financing Activities:

March 7, 2000 - 1,000,000 shares of common stock were issued in exchange for
legal services amounting to $3,127.


                 See accompanying notes to financial statements.

                                      F-6
<PAGE>
                             C AND E HOLDINGS, INC.
                          NOTES TO FINANCIAL STATEMENTS
                           FEBRUARY 28, 2002 AND 2001


NOTE 1 - ORGANIZATION AND OPERATIONS

C and E Holdings, Inc. ("Company") was incorporated under the laws of the State
of Nevada on March 7, 2000. The Company's primary business purpose is to develop
a publicly held holding company with the intention of acquiring operating
subsidiaries. As of the report date no subsidiaries have been acquired.

NOTE 2 - ESTIMATES

The preparation of financial statements in conformity with generally accepted
accounting principles 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 revenue and expenses during the reporting period. Actual
results could differ from those estimates.

NOTE 3 - FAIR VALUE OF FINANCIAL STATEMENTS

The carrying amount of cash approximates the fair value reported in the balance
sheet.

NOTE 4 - INCOME TAXES

Income taxes on continuing operations include the following:

                                       February 28, 2002       February 28, 2001
                                       -----------------       -----------------

     Currently payable                     $   --                   $   --
     Deferred                                  --                       --
                                           ------                   ------

         Total                             $   --                   $   --
                                           ======                   ======

                                      F-7
<PAGE>
                             C AND E HOLDINGS, INC.
                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                           FEBRUARY 28, 2002 AND 2001

NOTE 4 - INCOME TAXES (CONTINUED)

A reconciliation of the effective tax rate with the statutory U.S. income tax
rate is as follows:

<TABLE>
<CAPTION>
                                                   February 28, 2002        February 28, 2001
                                                   -----------------        -----------------
                                                               % of                      % of
                                                              Pretax                    Pretax
                                                   Income     Amount        Income      Amount
                                                   ------     ------        ------      ------
<S>                                               <C>              <C>      <C>              <C>
     Income taxes per statement of income         $     0          0%       $     0          0%
     Tax rate differences resulting from:
       Surtax exemption                                 0          0%             0          0%
       Income (loss) for financial reporting
        purpose without tax expense or
        benefit (unavailable for carryback
        against prior income taxes paid)           (2,099)       (34)%       (2,029)       (34)%
                                                  -------    -------        -------    -------

     Income taxes at a statutory rate             $(2,099)       (34)%      $(2,029)       (34)%
                                                  =======    =======        =======    =======
</TABLE>

The Company's deferred tax assets and liabilities at February 28, 2002 and 2001:

                                                   2002              2001
                                                 -------           -------

     Deferred tax asset                          $ 4,129           $   630
     Valuation allowance                          (4,129)             (630)
     Deferred tax liability                            0                 0
                                                 -------           -------
                                                       0           $     0
                                                 =======           =======

Deferred taxes are provided for temporary differences in deducting expenses for
financial statement and tax purposes. The principal source for deferred tax
assets is the difference in methods for recovering organization costs.

The Company has a net operating loss carryforward of $8,992 expiring beginning
in 2021.

NOTE 5 - LOSS PER COMMON SHARE

Income per common share is based on the weighted average number of shares
outstanding which was 2,000,000 for the year ended February 28, 2002 and the
period beginning March 7, 2000 (inception) and ended February 28, 2001.

NOTE 6 - RELATED PARTY TRANSACTIONS

A stockholder owning 50% of the outstanding shares of the Company provided legal
services in 2001 amounting to $3,127 in connection with the organization of the
Company in exchange for his shares.

                                      F-8