<PAGE>

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

                                   FORM 10-QSB

(Mark One)

         [X]   QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                  For the quarterly period ended MARCH 31, 2004

         [ ]   TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934
                  For the transition period from _____ to ____

Commission File Number: 0-21142

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

              MICHIGAN                                 38-2483796
     (State or other jurisdiction of        (I.R.S. Employer Identification No.)
     incorporation or organization)

          40950 WOODWARD AVENUE, SUITE 304, BLOOMFIELD HILLS, MI 48304
               (Address of principal executive offices) (Zip Code)

                                 (248) 723-3007
                (Issuer's telephone number, including area code)

      Check whether the issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act during the past 12 months (or
for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.

      [X] YES   [ ] No

      State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date:

       No par value Common Stock: 8,397,151 OUTSTANDING AS OF MAY 14, 2004

Transitional Small Business Disclosure Format: [ ] YES [X] NO

<PAGE>

                         PART I -- FINANCIAL INFORMATION

ITEM 1.    FINANCIAL STATEMENTS

                              SANDSTON CORPORATION
                      CONSOLIDATED CONDENSED BALANCE SHEET
                      MARCH 31, 2004 AND DECEMBER 31, 2003

<TABLE>
<CAPTION>
                                                                              MARCH 31,
                                                                                2004            DECEMBER 31,
                                                                            (UNAUDITED)            2003
                                                                            ------------        ------------
<S>                                                                         <C>                 <C>
                                     ASSETS
Current assets:
     Cash                                                                   $     30,000        $    207,139
     Accounts receivable, net of allowance for doubtful accounts of
          $81,000 at December 31, 2003                                                 -           3,087,911
     Inventories                                                                       -           1,498,800
     Prepaid expenses and other current assets                                         -             150,218
                                                                            ------------        ------------
              Total current assets                                                30,000           4,944,068

Property and equipment, net of accumulated depreciation of $7,843,152
at December 31, 2003                                                                   -           1,596,129
Note receivable from customer                                                          -              51,132
Software and related development costs, net of amortization                            -             398,138
Goodwill, net of amortization                                                          -           2,922,122
Other intangible assets, net of amortization                                                         217,952
                                                                            ------------        ------------
              Total assets                                                  $     30,000        $ 10,129,541
                                                                            ============        ============
                 LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
     Notes payable to related party under financing agreement               $          -        $  1,952,528
     Notes payable to bank                                                             -              63,750
     Accounts payable                                                                  -           1,363,150
     Deferred revenue and other accrued expenses                                       -           2,940,562
     Subordinated debt                                                                 -           4,511,500
     Current maturities of long-term debt                                                            173,667
                                                                            ------------        ------------
              Total current liabilities                                                -          11,005,157
Long-term debt, less current maturities                                                -           2,332,723
                                                                            ------------        ------------
              Total liabilities                                                        -          13,337,880

Stockholders' equity (deficit):
     Common stock, no par value, 30,000,000 shares authorized,
         3,148,894 shares outstanding                                         33,629,784          33,629,784
     Accumulated comprehensive loss                                                    -             (64,757)
     Accumulated deficit                                                     (33,599,784)        (36,773,366)
                                                                            ------------        ------------
              Total shareholders' equity (deficit)                                30,000          (3,208,339)
                                                                            ------------        ------------
              Total liabilities and shareholders' equity (deficit)          $     30,000        $ 10,129,541
                                                                            ============        ============
</TABLE>

                                       2

<PAGE>

                              SANDSTON CORPORATION
          CONSOLIDATED CONDENSED STATEMENTS OF DISCONTINUED OPERATIONS
                 FOR THE QUARTERS ENDED MARCH 31, 2004 AND 2003

<TABLE>
<CAPTION>
                                                            QUARTER ENDED MARCH 31,
                                                        --------------------------------
                                                            2004                2003
                                                         (UNAUDITED)         (UNAUDITED)
                                                        ------------        ------------
<S>                                                     <C>                 <C>
Net revenues                                            $  3,478,720        $  3,334,223
Cost of revenues                                           2,663,186           2,684,527
                                                        ------------        ------------
              Gross profit                                   815,534             649,696
Operating expenses:
     Product development costs - software                    102,227             165,787
     Selling, general and administrative expenses          1,094,314           1,082,485
     Gain on disposal of net asset                        (3,789,352)                -0-
                                                        ------------        ------------
              Total operating expenses                    (2,592,811)          1,248,272
                                                        ------------        ------------
              Operating income (loss)                      3,408,345            (598,576)
Other income (expense):
     Interest expense                                       (259,782)           (205,595)
     Sundry income, net of sundry expense                     25,019               4,618
                                                        ------------        ------------
              Total other income (expense)                  (234,763)           (200,977)
                                                        ------------        ------------
Earnings (loss) before income tax benefit                  3,173,582            (799,553)
Income tax benefit (Note 2)                                       --                  --
                                                        ------------        ------------
Net earnings (loss) from discontinued operations        $  3,173,582        $   (799,553)
                                                        ============        ============
Earnings (loss) per share (Note 4):
     Basic                                              $       1.01        $      (0.25)
                                                        ============        ============
     Diluted                                            $        .26        $      (0.25)
                                                        ============        ============
Weighted average shares outstanding:
     Basic                                                 3,148,894           3,148,894
                                                        ============        ============
     Diluted (Note 3)                                     12,837,058           3,148,894
                                                        ============        ============
</TABLE>

                              SANDSTON CORPORATION
      CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) FROM
                             DISCONTINUED OPERATIONS
                 FOR THE QUARTERS ENDED MARCH 31, 2004 AND 2003

<TABLE>
<CAPTION>
                                                                           QUARTER ENDED MARCH 31,
                                                                         ----------------------------
                                                                            2004              2003
                                                                         (UNAUDITED)      (UNAUDITED)
                                                                         -----------      -----------
<S>                                                                      <C>              <C>
Net earnings (loss) from discontinued operations                         $3,173,582       $ (799,553)
Other comprehensive loss - foreign currency translation adjustment           64,757          (19,237)
                                                                         ----------       ----------
Comprehensive earnings (loss) from discontinued operations               $3,238,339       $ (818,790)
                                                                         ==========       ==========
</TABLE>

                                       3

<PAGE>

                              SANDSTON CORPORATION
   CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS OF DISCONTINUED OPERATIONS
                 FOR THE QUARTERS ENDED MARCH 31, 2004 AND 2003

<TABLE>
<CAPTION>
                                                                                  QUARTER ENDED MARCH 31,
                                                                              --------------------------------
                                                                                  2004                2003
                                                                               (UNAUDITED)         (UNAUDITED)
                                                                              ------------        ------------
<S>                                                                           <C>                 <C>
Cash flows from operating activities:
     Net earnings (loss) from discontinued operations                         $  3,173,582        $   (799,553)
     Adjustments to reconcile net earnings (loss) from discontinued
      operations to net cash used in operating activities:
         Gain on disposal of net assets                                         (3,789,352)                -0-
         Depreciation                                                               56,012              75,726
         Amortization                                                               70,973              76,301
         Gain on disposal of property                                                 (983)             (3,890)
         Changes in assets and liabilities that provided (used) cash:
              Accounts receivable                                                  546,210            (165,114)
              Inventories                                                           (1,833)              9,553
              Prepaid expenses and other current assets                           (101,271)            (19,532)
              Accounts payable                                                    (682,319)            170,727
              Deferred revenue and accrued expenses                                606,430              57,867
                                                                              ------------        ------------
              Net cash used in operating activities                               (122,551)           (597,915)
                                                                              ------------        ------------
Cash flows from investing activities:
     Additions to property and equipment                                           (35,715)             (2,010)
     Proceeds from disposals of property and equipment                               4,149               2,824
     Sale of net assets                                                           (198,664)                  -
                                                                              ------------        ------------
         Net cash provided by (used in) investing activities                      (230,228)                815
                                                                              ------------        ------------
Cash flows from financing activities:
     Net borrowings from related party under financing agreement                   282,000                  --
     Proceeds from issuance of subordinated notes and warrants (Note 7)                 --             625,000
     Payments of long-term debt                                                    (48,066)            (44,873)
     Increase (decrease) in notes payable to banks                                 (45,000)             30,367
                                                                              ------------        ------------
              Net cash provided by financing activities                            188,934             610,494
                                                                              ------------        ------------
Foreign currency translation effect on cash                                        (13,294)            (19,237)
                                                                              ------------        ------------
Net decrease in cash                                                              (177,139)             (5,843)
Cash at beginning of period                                                        207,139             103,802
                                                                              ------------        ------------
Cash at end of period                                                         $     30,000        $     97,959
                                                                              ============        ============
Supplemental disclosures of cash flow information:
     Cash paid for interest                                                   $    202,566        $    188,403
     Cash paid for income taxes                                                         --                  --
Disposal of net assets:
        Sales price - liabilities assumed                                     $ 13,485,268
        Cash                                                                      (198,664)
        All other assets                                                        (9,497,252)
                                                                              ------------
                                                                              $  3,789,352
                                                                              ============
</TABLE>

                                       4

<PAGE>

                              SANDSTON CORPORATION
              NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
               FOR THE THREE MONTHS ENDED MARCH 31, 2004 AND 2003

NOTE 1 - BASIS OF PRESENTATION

Pursuant to a recommendation of Nematron Corporation's Board of Directors and
approval by its shareholders on January 13, 2004, on March 31, 2004 Nematron
sold to NC Acquisition Corporation ("Purchaser") all of its tangible and
intangible assets, including its real estate, accounts, equipment, intellectual
property, inventory, goodwill, and other intangibles, except for $30,000 in
cash, (the "Net Asset Sale"). The Purchaser also assumed all of Nematron's
liabilities pursuant to the Net Asset Sale. Following the Net Asset Sale,
Nematron's only remaining assets were $30,000 in cash; it retained no
liabilities. On April 1, 2004 the company amended its Articles of Incorporation
to change its name to Sandston Corporation ("the "Company") and implement a
shareholder approved five-for-one reverse stock split of the Company's common
stock, whereby every five issued and outstanding shares of the Company's common
stock became one share. Also, on April 1, 2004 Nematron sold a total of
5,248,257 post-split shares to Dorman Industries, LLC ("Dorman Industries") for
$50,000. Dorman Industries is a Michigan Limited Liability Company wholly owned
by Mr. Daniel J. Dorman, the Company's new Chairman of the Board. Pursuant to
the purchase of the shares by Dorman Industries, Dorman Industries owns 62.5% of
the outstanding common stock of the Company.

Effective April 1, 2004, the Company became a "public shell" corporation. The
Company intends to use its public shell platform to build long-term shareholder
value by acquiring and/or investing in and operating strategically positioned
companies. The Company is expected to target companies with solid operating
performance that are well managed and in several industry groups. The targeted
companies are generally expected to have the following characteristics: sales
volume of between $20 million and $250 million; value added manufacturing,
distribution and business services; fragmented industries; experienced
management; and consistent historical financial performance.

During the period prior to the Net Asset Sale, the Company owned the following
wholly-owned subsidiaries: Nematron Limited, a United Kingdom corporation,
Nematron Canada Inc., a Canadian corporation, A-OK Controls Engineering, Inc.
("A-OK Controls"), a Michigan corporation, and Optimation, Inc. ("Optimation"),
an Alabama corporation (collectively, "Subsidiaries"). The assets and
liabilities of the Subsidiaries were included in the Net Asset Sale described
above.

The accompanying consolidated financial statements include the accounts of
Sandston Corporation (formerly Nematron Corporation) and its Subsidiaries. All
significant intercompany transactions and balances have been eliminated in
consolidation. To reflect the fact that the assets and liabilities of the
business were sold at quarter end, the generic names of the financial statement
included herein have been changed to reflect the fact that the operations giving
rise to the assets and liabilities, revenue and expenses, and cash flows have
been discontinued as of March 31, 2004. The accompanying consolidated financial
statements include a Consolidated Condensed Balance Sheet, Consolidated
Condensed Statements of Discontinued Operations, Consolidated Condensed
Statements of Comprehensive Loss From Discontinued Operations and Consolidated
Condensed Statements of Cash Flows of Discontinued Operations.

In the opinion of management, all adjustments considered necessary for a fair
presentation of the consolidated financial statements of the discontinued
operations for the interim periods have been included. Certain information and
footnote disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been condensed or
omitted pursuant to the Securities and Exchange Commission's rules and
regulations, although the Company believes that the disclosures are adequate to
make the information presented not misleading. It is suggested that these
condensed consolidated financial statements should be read in conjunction with
the consolidated financial statements and notes thereto included in the
Company's latest annual report on Form 10-KSB.

The results of the discontinued operations for the three-month periods ended
March 31, 2004 and 2003 are not necessarily indicative of the results to be
expected for the full year. Additionally, pursuant to the Net Asset Sale,
effective March 31, 2004 the Company has no revenue generating activities and
its only assets are the $80,000 in cash it retained and generated through the
sale of additional common stock, but also pursuant to the Net Asset Sale, the
Purchaser assumed all of the Company's liabilities.

                                       5

<PAGE>

NOTE 2 - TAXES ON INCOME

The Company has net operating loss carryforwards ("NOLs") of approximately $29.4
million as of December 31, 2003 that may be applied against future taxable
income and which expire at various dates between 2004 and 2023. Utilization of
certain of these NOLs is subject to annual limitations under current Internal
Revenue Service regulations. As of December 31, 2003, the Company has
established a valuation allowance for the total estimated amount of the net
deferred tax assets, including the amount attributed to the NOL, as realization
of these net deferred tax assets is dependent upon generating sufficient taxable
income prior to their expiration.

Income tax expense has not been recorded for the quarter ended March 31, 2004,
as the Company estimates that the NOL carryforward will be utilized to offset
the net income generated by the gain on disposal of assets, with an offsetting
reduction in the valuation allowance.

NOTE 3 - STOCK BASED COMPENSATION

The Company has stock-based employee and director compensation plans, which are
described more fully in Note 11 to the Company's December 31, 2003 financial
statements. The Company accounts for those plans under the recognition and
measurement principles of APB Opinion No. 25, Accounting for Stock Issued to
Employees, and related Interpretations. No stock-based employee compensation
cost is reflected in net loss, as all options granted under those plans had an
exercise price greater than or equal to the market value of the underlying
common stock on the date of grant. The following table illustrates the effect on
net loss and loss per share if the Company had applied the fair value
recognition provisions of FASB Statement No. 123, Accounting for Stock-Based
Compensation, to stock-based employee compensation.

<TABLE>
<CAPTION>
                                                                         Three Months Ended March 31,
                                                                           2004               2003
                                                                       -------------        ---------
<S>                                                                    <C>                  <C>

    Net earnings (loss) of discontinued operations as reported         $  3,173,582         $(799,553)
    Deduct:  Total stock-based employee compensation expense
     determined under fair value-based method for all awards,
     net of tax                                                                   --          (54,787)
                                                                       -------------        ---------
        Pro forma net earnings (loss) of discontinued operations       $   3,173,582        $(854,340)
                                                                       =============        =========
    Earnings (loss) per share:
      Basic, as reported                                               $        1.01        $   (0.25)
      Diluted, as reported                                             $        0.26        $   (0.25)
    Pro Forma
      Basic                                                            $        1.01        $   (0.27)
      Diluted                                                          $        0.26        $   (0.27)
</TABLE>

NOTE 4 - EARNINGS PER SHARE

The weighted average shares outstanding used in computing earnings and loss per
share for the three-month periods ended March 31, 2004 and 2003 respectively,
were 3,148,894, as adjusted for the one-for-five reverse stock split. Prior to
the approval by the Board of Directors and shareholders of a one-for-five
reverse stock split, there were 15,744,472 shares outstanding.

Earnings per share for quarter ended March 31, 2004 is as follows:

<TABLE>
<CAPTION>
                                                         Income            Shares         Earnings
                                                       (Numerator)      (Denominator)    Per Share
                                                       -----------      -------------    ---------
<S>                                                    <C>              <C>              <C>
Basic EPS:
       Net income                                      $ 3,173,582          3,148,894    $    1.01
                                                       ===========      =============    =========
Diluted EPS:
       Net income                                      $ 3,173,582          3,148,894    $    1.01
       Effect of dilutive convertible securities           140,250          9,688,164        (0.75)
                                                       -----------      -------------    ---------
       Income available to common
       shareholders plus assumed conversion            $ 3,313,832         12,837,058    $    0.26
                                                       ===========      =============    =========
</TABLE>


Earnings per share for quarter ended March 31, 2003 is as follows:

<TABLE>
<CAPTION>
                                                         Income            Shares         Earnings
                                                       (Numerator)      (Denominator)    Per Share
                                                       -----------      -------------    ---------
<S>                                                    <C>              <C>              <C>
Basic and diluted EPS:
       Net loss                                        $  (799,553)         3,148,894    $   (0.25)
                                                       ===========      =============    =========
</TABLE>



                                       6

<PAGE>

For the three-month periods ended March 31, 2004 and 2003, outstanding options
and warrants were not included in the computation of diluted loss per share
because the inclusion of such securities is antidilutive. Information relative
to the excluded options and warrants is as follows:

<TABLE>
<CAPTION>
                         Outstanding Options                Outstanding Warrants
                     ----------------------------       ---------------------------
                                      Expiration                         Expiration
Quarter Ended          Amount           Dates            Amount             Dates
--------------       ---------       ------------       ---------       ------------
<S>                  <C>             <C>                <C>             <C>
March 31, 2004       2,017,528       2003 to 2011       5,361,504       2004 to 2008
March 31, 2003       2,017,528       2003 to 2011       4,791,333       2003 to 2007
</TABLE>

As a result of the Net Asset Sale described in Note 1, all warrants were
canceled and substantially all options will expire by their terms effective June
30, 2004 whereunder employees forfeit unexercised options 90 days after
termination.

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

THREE MONTHS ENDED MARCH 31, 2004 COMPARED WITH THREE MONTHS ENDED MARCH 31,
2003

      Readers should refer to a description of the Net Asset Sale described in
Note 1 to the financial statements included in this Form 10-QSB. As described
therein, the net assets and businesses of the Registrant giving rise to reported
results of the Registrant, as reflected in the Consolidated Condensed Balance
Sheet, have been sold effective as of the close of business on March 31, 2004.
Accordingly, Sandston Corporation became a "public shell" corporation and
intends to use its public shell platform to build long-term shareholder value by
acquiring and/or investing in, and operating strategically positioned companies.
The Company is expected to target companies with solid operating performance
that are well managed and in several industry groups. The targeted companies are
generally expected to have the following characteristics: sales volume of
between $20 million and $250 million; value added manufacturing, distribution
and business services; fragmented industries; experienced management; and
consistent historical financial performance. At this time, Company management is
evaluating its investment alternatives and it has not recommended to the Board
of Directors for their consideration any specific investment opportunities.
However, as investment opportunities present themselves and management completes
its due diligence on such opportunities, the timing and nature of potential
investment targets may accelerate.

      Because of the effects of the Net Asset Sale, the discussion and analysis
of results of operations following does not include any forward-looking
statements, as the operations described herein have been discontinued effective
as of the close of business on March 31, 2004.

      Net revenues for the first quarter of 2004 increased $144,000 (4.3%) to
$3,479,000 compared to $3,334,000 for the comparable period last year. The
increase is attributable primarily to an increase in sales of software licenses,
system integration services and repair services. Revenues from software
licenses, system integration services and repair services increased in the
current period compared to the prior year period because of an increased demand
and response to increased marketing and sales efforts. Sales of hardware
products decreased in most product categories as customers continued to show
caution in their capital spending patterns.

      Gross profit for the first quarter of 2004 increased $166,000 (25.5%) to
$816,000 compared to $650,000 for the comparable period last year. Gross profit
as a percentage of revenue in the first quarter of 2004 was 23.4% compared to
19.5% in the comparable period last year. The increase in the gross profit
percentage results from better profit margins on software licenses, system
integration services and repair services, which increased as a percentage of
total sales in the first quarter of 2004.

                                       7

<PAGE>

      Software product development expenses for the first quarter of 2004
decreased $64,000 (38.3%) to $102,000 compared to $166,000 for the comparable
period last year. The decrease is attributable to a decrease in development
staff and a short term shift to product support activities.

      Selling, general and administrative expenses for the first quarter of 2004
increased $12,000 (1.1%) to $1,094,000 compared to $1,082,000 for the comparable
period last year and decreased as a percentage of net revenue to 34.4% in the
first quarter of 2004 from 37.4% in the comparable period last year. The
increase results primarily from increases in audit and legal fees incurred in
the current period compared to the year earlier period.

      In connection with the Net Asset Sale consummated on March 31, 2004, the
Company transferred all its assets other than $30,000 in cash, as well as all
its liabilities, to the Purchaser. Liabilities assumed by the Purchaser exceeded
the assets sold, which resulted in a non-cash gain of $3,789,352, which is
recorded in the accompanying Consolidated Condensed Statement of Discontinued
Operations.

      Interest expense for the first quarter of 2004 increased $54,000 (26.4%)
to $260,000 compared to $206,000 for the comparable period last year. The
increase results primarily from higher overall average borrowing levels during
the current period compared to the year ago period.

      Sundry income was not significant in either reported period.

                                       8

<PAGE>

LIQUIDITY AND CAPITAL RESOURCES

      On March 31, 2004, the Company sold to NC Acquisition Corporation
("Purchaser") all of its tangible and intangible assets, including its real
estate, accounts, equipment, intellectual property, inventory, goodwill, and
other intangibles, except for $30,000 in cash, (the "Net Asset Sale"). The
Purchaser also assumed all of the Company's liabilities pursuant to the Net
Asset Sale. Following the Net Asset Sale, the Company's only remaining assets
were $30,000 in cash; it retained no liabilities. On April 1, 2004, the Company
amended its Articles of Incorporation to change its name to Sandston Corporation
and implement a shareholder approved five-for-one reverse stock split of the
Company's common stock, whereby every five issued and outstanding shares became
one share. Also, on April 1, 2004 a total of 5,248,257 post-split shares were
sold to Dorman Industries LLC ("Dorman Industries") for $50,000. Dorman
Industries is a Michigan Limited Liability Company wholly owned by Mr. Daniel J.
Dorman, the Company's new Chairman of the Board. Pursuant to the purchase of the
shares by Dorman Industries, Dorman Industries owns 62.5% of the outstanding
common stock of the Company.

      Effective April 1, 2004, the Company became a "public shell" corporation
and intends to use its public shell platform to build long-term shareholder
value by acquiring and/or investing in, and operating strategically positioned
companies. The Company is expected to target companies with solid operating
performance that are well managed and in several industry groups. The targeted
companies are generally expected to have the following characteristics: sales
volume of between $20 million and $250 million; value added manufacturing,
distribution and business services; fragmented industries; experienced
management; and consistent historical financial performance.

      The Company anticipates that the form of its investment would be providing
strategic and operational oversight, portfolio and financial management,
corporate development and corporate administrative services such as banking,
insurance, regulatory compliance and treasury functions to portfolio businesses.
In addition, add-on acquisitions will be identified for key industry groups
within the Company's operations. The intent is that the Company will not
function merely as a provider of capital or as an investment fund, but will use
the knowledge, resources and relationships of the principals of its management
to actively manage and participate in the growth of any acquired underlying
portfolio businesses.

      At this time, Company management is evaluating its investment alternatives
and it has not recommended to the Board of Directors for their consideration any
specific investment opportunities. However, as investment opportunities present
themselves and management completes its due diligence on such opportunities, the
timing and nature of potential investment targets may accelerate.

      Current operating expenses of the Company are being funded with available
cash retained from the Net Asset Sale and from cash generated by the sale of
additional shares of common stock to Dorman Industries. While it is the
Company's objective to ultimately be able to use the securities of the Company
as a currency in the acquisition of portfolio businesses, it is clear that the
initial acquisitions of portfolio businesses will require the Company to be
infused with capital thereby diluting the Company's shareholders, including
Dorman Industries to the extent that it does not participate in the capital
infusion.

      The Company's sole business activity is pursuing the acquisition of an
operating company and/or its assets. If an acquisition does take place within
the next twelve months, the Company will need to raise additional capital to
consummate the acquisition. The Company's cash resources are very limited, and
even if an acquisition does not take place within the next twelve months, the
Company may still need to attempt to raise sufficient capital to continue its
operations. There can be no guarantee that the Company could raise the needed
capital for an acquisition or to continue operations on any terms or conditions.

      The Company currently has only one employee but, would expect that in
connection with an acquisition of an operating company, the company's number of
employees would increase significantly.

UNCERTAINTIES RELATING TO FORWARD LOOKING STATEMENTS

      Parts of this Form 10-QSB contain certain "forward-looking statements"
within the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. Statements
containing the words "believes," "anticipates," "estimates," "expects,"
"intends," "plans," "seeks," "will," "may," "should," "would," "projects,"
"predicts," "continues," and similar expressions or the negative of these terms
constitute forward-looking statements that involve risks and uncertainties. We
intend such forward-looking statements to be covered by the safe harbor
provisions for forward-looking statements contained in the Private Securities
Litigation Reform Act of 1995, and are including this statement for purposes of
invoking these safe harbor provisions. Such statements are based on current
expectations and are subject to risks, uncertainties and changes in condition,
significance, value and effect, including those discussed in the section
entitled "Risk Factors" contained in our Annual Report on Form 10-KSB for the
fiscal year ended December 31, 2003. Such risks, uncertainties and changes in
condition, significance, value and effect could cause the Company's actual
results to differ materially from those anticipated events. Except as may be
required under federal law, we undertake no obligation to update publicly any
forward-looking statements for any reason, even if new information becomes
available or other events occur.

                                       9

<PAGE>

      Risks and uncertainties may include the following:

      -     The potential inability to identify potential investment
            opportunities;

      -     The potential inability to raise sufficient additional equity to
            acquire targeted entities, or to acquire less than 100% ownership of
            a target company or it's assets;

      -     A decline in the capital markets or changes in the capital markets
            that would cause available capital at unattractive interest rates;

      -     Delays in performing due diligence activities on targeted entities,
            if any;

      -     The potential inability to close the acquisition of targeted
            entities, if any, by reason of seller-influenced or
            seller-determined contingencies;

      -     The inability of the Company to successfully implement its strategy.

ITEM 3. CONTROLS AND PROCEDURES

      Our principal executive and principal financial officer has concluded,
based on his evaluation within 90 days of the filing date of this report, that
our disclosure controls and procedures are effective for gathering, analyzing
and disclosing the information we are required to disclose in our reports filed
under the Securities Exchange Act of 1934. There have been no significant
changes in our internal controls or in other factors that could significantly
affect these controls subsequent to the date of the previously mentioned
evaluation.

      Grant Thornton, the Company's independent auditor advised the Company
during the performance of the audit of the Company's consolidated financial
statements at December 31, 2003 of a reportable condition under standards
established by the American Institute of Certified Public Accountants. In the
application of Emerging Issues Task Force Consensus 00-27, "Application of Issue
No. 98-5 to certain Convertible Instruments" ("EITF 00-27") in the determination
of the value of the beneficial conversion features connected with the issuance
of convertible securities with detachable warrants, an adjustment resulted
increasing interest expense and common stock. This is a complex area of
accounting involving the computation of intrinsic values inherent in relative
values of the instruments. In response to the observations made by Grant
Thornton, the Company will implement certain enhancements to its internal
controls and procedures. During the first quarter of 2004 there were no
convertible instruments that presented a reportable condition. The company is
still evaluating a course of action that will be implemented during 2004 to
address this concern, however, the first quarter of 2004 was focused on
completing the Net Asset Sale.

                           PART II - OTHER INFORMATION

ITEM 2. CHANGES IN SECURITIES

On April 1, 2004, the Company amended its Articles of Incorporation to change
its name to Sandston Corporation and implement a shareholder approved
five-for-one reverse stock split of the Company's common stock. The Company also
sold 5,248,257 post-split shares of the Company's common stock to Dorman
Industries for $50,000. Mr. Daniel J. Dorman, the Company's new Chairman of the
Board, is the sole owner of Dorman Industries. Mr. Dorman and Dorman Industries
are accredited investors and purchased the shares, which were not registered
under the Securities Act of 1933, as amended (the "Act"), in reliance upon
Section 4(2) of the Act. The Company relied upon the exemption from registration
based on the (a) fact that there was a single purchaser, (b) purchaser's
financial and other information provided to the Company, and (c) lack of general
solicitation in the offering.

                                       10

<PAGE>

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

The Registrant held its Annual Meeting of Shareholders for the year ended
December 31, 2002 on January 13, 2004.

There was five matters voted upon, which included the election of Directors. The
following table sets forth the results of the voting on the election of
Directors.

<TABLE>
<CAPTION>
    Nominees           Votes For       Votes Withheld   Total Votes
----------------       ---------       --------------   -----------
<S>                    <C>             <C>              <C>
Daniel J. Dorman       13,937,335          124,752       14,062,087
Lawrence DeFiore       13,937,035          125,052       14,062,087
</TABLE>

Mr. Matthew S. Galvez will continue as a Director of the Registrant.

The four additional proposals voted upon at the meeting included the following:

Proposal 1. To approve a proposal to sell substantially all of the Company's
assets and liabilities to NC Acquisition Corporation, a company whose owners are
the Company's senior and subordinated debt holders. The tabulation of votes on
Proposal 1 was as follows:

<TABLE>
<S>                    <C>
For                     8,484,974
Against                    50,614
Abstentions                81,666
Broker non-votes        5,444,833
                       ----------
Total                  14,062,087
                       ==========
</TABLE>

Proposal 2. To approve the purchase of 5,248,257 shares of Common Stock by
Dorman Industries, LLC. The tabulation of votes on Proposal 2 was as follows:

<TABLE>
<S>                    <C>
For                     8,463,447
Against                    71,279
Abstentions                82,528
Broker non-votes        5,444,833
                       ----------
Total                  14,062,087
                       ==========
</TABLE>

Proposal 3. To approve a five-for-one reverse stock split with respect to the
Company's Common Stock and an amendment to the Company's Amended and Restated
Articles of Incorporation ("Articles") to effect the reverse stock split. The
tabulation of votes on Proposal 3 was as follows:

<TABLE>
<S>                    <C>
For                    13,930,193
Against                    48,319
Abstentions                83,575
                       ----------
Total                  14,062,087
                       ==========
</TABLE>

Proposal 4. To amend the Articles to change the Company's name to Sandston
Corporation. The tabulation of votes on Proposal 4 was as follows:

<TABLE>
<S>                    <C>
For                    13,944,538
Against                    29,443
Abstentions                88,106
                       ----------
Total                  14,062,087
                       ==========
</TABLE>


                                       11

<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a)   Exhibits included herewith are set forth on the Index to Exhibits, which
      is incorporated herein by reference.

(b)   In April 2004, the Company filed the following two Current Reports on Form
      8-K:

      -     April 04, 2004, reporting the notification that the Registrant's
            certifying accountant intends to resign.

      -     April 15, 2004, reporting 1) the sale of substantially all the
            assets and liabilities of the Registrant and 2) the change in
            control of the Registrant pursuant to the sale of common stock to
            Dorman Industries.

                                       12
<PAGE>

                                   SIGNATURES

In accordance with the requirements of the Securities Exchange Act of 1934, the
registrant has caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.

                                      SANDSTON CORPORATION

MAY 14, 2004                          /S/ DANIEL J. DORMAN
-------------------------------       -----------------------------------------
DATE                                  CHAIRMAN AND PRINCIPAL FINANCIAL OFFICER

                                       13

<PAGE>

                                INDEX TO EXHIBITS

<TABLE>
<CAPTION>
Exhibit Number                      Description of Exhibit
--------------                      ----------------------
<S>               <C>
      2.0         Asset Purchase Agreement dated March 31, 2004 between NC
                  Acquisition Corp., as Purchaser and Nematron Corporation, as
                  Seller, and filed as Exhibit 2(a) to the Registrant's Form 8-K
                  filed on April 15, 2004 and incorporated herein by reference.

      3.01        Amended and Restated Articles of Incorporation, as amended,
                  filed as Exhibit 3.1 to the Registrant's Form 10-QSB for the
                  quarterly period ended September 30, 1999 and incorporated
                  herein by reference.

      3.02        Certificate of Amendment to the Articles of Incorporation
                  filed April 1, 2004 with the Michigan Department of Labor and
                  Economic Growth.

     31.0         Certification of President, CEO and Chief Accounting Officer
                  Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

     32.0         Certification of President, CEO and Chief Accounting Officer
                  Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to
                  Section 906 of the Sarbanes-Oxley Act of 2002
</TABLE>

                                       14