SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-QSB

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

For The Quarterly Period Ended September 30, 2004

or

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

Commission file No. 0-29501

Com-Guard.com, Inc.

(Exact name of registrant as specified in its charter)

NEVADA	33-0879853
(State or other jurisdiction of incorporation or organization)	(IRS Employer ID No.)

2075 Corte del Nogal, Suite R

Carlsbad, California 92009

(Address of principal executive offices)

Registrant's Telephone Number, Including Area Code: (760) 431-2206

Check whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes [  X ]       No [    ]

The number of shares outstanding of the registrant's common stock as of November 19, 2004 was 40,609,901.

TABLE OF CONTENTS

Section	Heading	Page
Part I	CONSOLIDATED FINANCIAL INFORMATION
Item 1	CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
	Condensed Consolidated Balance Sheets  as of September 30, 2004 (unaudited) and June 30, 2004	F-1
	Condensed Consolidated Statements of Operations for the  three months ended September 30, 2004 and 2003 (unaudited)	F-2
	Condensed Consolidated Statements of Cash Flows for the   three months ended September 30, 2004 and 2003 (unaudited)	F-3
	Notes to Condensed Consolidated Financial Statements   as of September 30, 2004 (unaudited)	F-4 - F-6
Item 2	Management's Discussion and Analysis of Financial Condition and Results of Operations	1
Item 3	Controls and Procedures	4
Part II	Other Information
Item 1	Legal Proceedings	5
Item 2	Changes in Securities and Use of Proceeds	5
Item 3	Defaults Upon Senior Notes	5
Item 4	Submission of Matters of a Vote to Security Holders	5
Item 5	Other Information	5
Item 6	Exhibits and Reports on Form 8-K	5
	Signatures	6
	Sarbanes-Oxley Certifications

COM-GUARD.COM, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED BALANCE SHEETS

	September 30, 2004			June 30, 2004
ASSETS	(unaudited)
Current assets
Cash and cash equivalents	$	250,000		$	394,000
Accounts receivable		619,000			-
Inventories		7,000			488,000
Prepaid expenses and other current assets		31,000			-
Total assets	$	907,000		$	882,000
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable	$	202,000			163,000
Accrued expenses		664,000			590,000
Line of credit — bank		25,000			25,000
Convertible notes payable to a related party, net of unamortized discount of $3,000 and $10,000,             respectively		7,000			10,000
Loan payable - officer		3,000			3,000
Total current liabilities		901,000			791,000
Commitments and contingencies
Stockholders’ equity
Common stock, $.001 par value, 100,000,000 shares authorized, 40,609,901 and 39,721,342 shares  issued and outstanding, respectively		41,000			40,000
Additional paid-in-capital		9,472,000			9,413,000
Accumulated deficit		(9,507,000	)		(9,362,000	)
Total stockholders’ equity		6,000			91,000
Total liabilities and stockholders’ equity	$	907,000		$	882,000

See accompanying notes to condensed consolidated financial statements.COM-GUARD.COM, INC. AND SUBSIDIARY

F-1

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

For the Three months ended September 30, 2004 and 2003

(unaudited)

	2004			2003
Net sales	$	1,702,000		$	3,000
Cost of goods sold		1,579,000			-
Gross profit		123,000			3,000
Operating expenses
Selling, general and administrative		261,000			400,000
Total operating expenses		261,000			400,000
Loss from operations		(138,000	)		(397,000	)
Other income (expense)
Interest expense		(7,000	)		(1,000	)
Interest income		-			-
Total other expense		(7,000	)		(1,000	)
Loss before provision for income taxes		(145,000	)		(398,000	)
Less: provision for income taxes		-			-
Net loss	$	(145,000	)	$	(398,000	)
Net loss per share - basic and diluted	$	-		$	(0.02	)
Weighted average number of shares outstanding - basic and diluted		40,516,982			18,029,791

See accompanying notes to condensed consolidated financial statements.

F-2

COM-GUARD.COM, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

	For theThree months ended September 30,
	2004			2003
Cash Flows From Operating Activities:
Net loss	$	(145,000	)	$	(398,000	)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock issued for services		59,000			40,000
Amortization of discount on convertible notes payable		7,000			-
Changes in operating assets and liabilities:
Accounts receivable		(619,000	)		2,000
Inventories		481,000			-
Prepaid expenses and other current assets		(31,000	)
Accounts payable and accrued expenses		113,000			205,000
Net cash used in operating activities		(135,000	)		(151,000	)
Cash Flows From Financing Activities:
Proceeds from the sale of warrants		1,000
Proceeds from convertible notes payable					10,000
Repayment of convertible notes payable		(10,000	)		-
Net proceeds (repayments) from bank line of credit		-			4,000
Net cash (used in) provided by financing activities		(9,000	)		14,000
Net decrease in cash and cash equivalents		(144,000	)		(137,000	)
Cash and cash equivalents at beginning of period		394,000			141,000
Cash and cash equivalents at end of period	$	250,000		$	4,000
Supplemental disclosure of cash flow information:
Interest paid	$	-		$	-
Taxes paid	$	-		$	-

See accompanying notes to condensed consolidated financial statements.

F-3

COM-GUARD.COM, INC. AND SUBSIDIARY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF SEPTEMBER 30, 2004

(unaudited)

NOTE 1 - THE COMPANY AND BASIS OF PRESENTATION

The accompanying interim condensed consolidated financial statements of Com-Guard.com, Inc. and subsidiary (collectively, the "Company" or “Com-Guard”) have been prepared pursuant to the rules of the Securities and Exchange Commission (the "SEC") for quarterly reports on Form 10-QSB and do not include all of the information and note disclosures required by generally accepted accounting principles. These condensed consolidated financial statements and notes herein are unaudited, but in the opinion of management, include all the adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation of the Company’s financial position, results of operations, and cash flows for the periods presented. These condensed consolidated financial statements should be read in conjunction with the Company's audited financial statements and notes thereto included in the Company’s Form 10-KSB for the year ended June 30, 2004 as filed with the SEC on October 13, 2004. Interim operating results are not necessarily indicative of operating results for any future interim period or for the full year.

Com-Guard was incorporated in the state of Nevada on October 7, 1998 as E-WORLD SECURITY, INC and on April 16, 1999, the Company changed its name to COM-GUARD.COM, INC. The Company’s planned principal operations commenced during the year ended June 30, 2003. The Company sells products that afford security protection to computer hardware and software in microcomputers. The Company’s initial product, Com-Guard™, includes unique software and hardware that enables users to protect and limit access to data and to provide a security system against tampering and unauthorized use of computers. At the end of the fiscal year ended June 30, 2004, the Company formed its PC Products subsidiary which started formal operating activities during the first quarter of fiscal year 2005. In addition to generating potential sales of computers and accessories, which may include Com-Guard™ security products, this subsidiary will be used to generate end-user awareness of the Company’s security products.

The accompanying condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern. During the three months ended September 30, 2004, the Company suffered a net loss of $145,000 and had negative cash flows from operating activities of $135,000. As of September 30, 2004, the Company had an accumulated deficit of $9,507,000. The Company has sustained its operations primarily through equity and debt financing. These conditions raise substantial doubt about the Company's ability to continue as a going concern.

In view of these matters, realization of a major portion of the assets in the accompanying consolidated balance sheet is dependent upon continued operations of the Company, which in turn is dependent upon the Company's ability to meet its working capital requirements, and the success of its future operations. Management’s current plans are: (1) to further commercialize its own products, (2) to market new products, including products from other manufacturers, and (3) to continue to operate and improve its e-commerce sites to sell its products. Management believes that the actions presently being taken to revise the Company's operating and financial requirements may provide the opportunity for the Company to continue as a going concern.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(A) Principles of Consolidation

The accompanying condensed consolidated financial statements include the accounts of Com-Guard.com, Inc. and its wholly owned subsidiary, PC Products, Inc. All significant inter company accounts and transactions have been eliminated.

(B) Use of Estimates

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

F-4

(C) Reclassifications

Certain amounts from prior periods have been reclassified to conform to the current period’s presentation.

(D) Stock Options and Warrants

In accordance with Statement of Financial Accounting Standards ("SFAS") No. 123, "Accounting for Stock-Based Compensation," the Company has elected to account for Stock Options issued to employees under Accounting Principles Board Opinion No. 25 ("APB Opinion No. 25") and related interpretations. The Company accounts for stock options issued to non-employees under the fair value method of SFAS No. 123. Under APB Opinion No. 25, if the exercise price of the Company’s stock options equal or exceeds the market price of the underlying stock on the date of grant, no compensation cost is recognized. 

SFAS No. 123, Accounting for Stock-Based Compensation, as amended by SFAS No. 148, Accounting for Stock-Based Compensation - Transition and Disclosure, requires the Company to provide pro forma information regarding net income and earnings per share for each period presented as if compensation cost for the Company’s stock options was determined in accordance with the fair market value based method prescribed in SFAS No. 123.  The Company estimates the fair value of each stock option at the grant date by using the Black-Scholes option pricing model. The estimated fair value of each stock option granted in fiscal 2004 using the Black-Scholes option pricing model was based on the following weighted average assumptions: no dividend yield; expected volatility of 183%; risk-free interest rate of 3%, and an expected life of 6 years. The Company granted no additional options or warrants during the quarter ended September 30, 2004.

Under the accounting provisions of SFAS No. 123, as amended by SFAS No. 148, the Company’s pro forma net loss and net loss per common share reflects the expense related to options issued to employees which is recognized over the vesting period. For the three months ended September 30, 2004 and 2003, the pro forma net loss and net loss per common share would have been as follows:

Net loss:	2004			2003
As reported	$	(145,000	)	$	(398,000	)
Pro forma	$	(198,000	)	$	(677,000	)
Net loss per common share - basic and fully diluted:
As reported	$	-		$	(0.02	)
Pro forma	$	-		$	(0.04	)

(E) Loss Per Share

Basic and diluted net loss per share for all periods presented is computed based upon the weighted average number of common shares outstanding as defined by SFAS No. 128, "Earnings Per Share". Common stock equivalents, have not been included in the computation of diluted loss per share since the effect would be anti-dilutive for all periods presented.

(F) Concentration of Credit Risk Arising from Cash Deposits in Excess of Insured Limits

The Company maintains the majority of its cash balances in a financial institution located in Carlsbad, California. The balance in this institution is insured by the Federal Deposit Insurance Corporation up to $100,000. At September 30, 2004, the Company's uninsured cash total was $150,000.

(G) Fair Value of Financial Instruments

SFAS No. 107, “Disclosures about Fair Value of Financial Instruments”, requires disclosures of information about the fair value of certain financial instruments for which it is practicable to estimate that value. For purposes of this disclosure, the fair value of a financial instrument is the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation.

The carrying amounts of the Company’s financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and accrued expenses, line of credit and notes payable, approximate fair value due to the relatively short period to maturity for these instruments.

(H) Rounding

All amounts have been rounded to the nearest $1,000 except for share amounts.

NOTE 3 - LINE OF CREDIT - BANK

At September 30, 2004, the Company had a line of credit from a bank for short-term borrowing in the amount of $25,000, which bears interest at floating rates. This line is unsecured. Total interest expense associated with the line of credit amounted to $1,000 and $1,000 for the three months ended September 30, 2004 and 2003, respectively.

 F-5

NOTE 4 - RELATED PARTY TRANSACTIONS

Convertible Notes Payable - Related Party

During fiscal years 2003 and 2004, the Company issued convertible notes to certain individuals, at par, maturing at various dates throughout 2004, for an original principal amount of $214,000. The notes bore interest at 7.0% and 7.5%, and were convertible, at the option of the holder, into shares of the Company's common stock at prices from $0.15 to $0.35 per share. During fiscal 2004, the holders of the convertible notes converted outstanding debt and accrued interest of approximately $124,000 into 1,234,642 shares of the Company's common stock.

In conjunction with the sale of convertible notes payable during fiscal 2004, the Company issued warrants to purchase an aggregate of 666,667 shares of the Company’s common stock at a price of $0.15 per share. The warrants were valued using the Black-Scholes pricing model and the aggregate fair value of $99,000 (limited to the face value of the notes) was recorded as discounts on notes payable and is being amortized as additional interest expense over the life of the notes. During the three months ended September 30, 2004, aggregate interest expense associated with the amortization of the discount of notes payable was $7,000 and the unamortized bond discount was $3,000.

In August 2004, the Company repaid $10,000 of the convertible notes payable to a stockholder. As of September 30, 2004, the Company had one outstanding $10,000 convertible note payable, bearing interest at 7.5%, with principal and interest due December 31, 2004. The note is convertible, at the option of the holder, into common shares of the Company at a conversion price of $0.15 per share.

NOTE 5 - STOCKHOLDERS’ EQUITY

During the three months ended September 30, 2004, the Company issued 595,000 shares of common stock at prices ranging from $0.09 and $0.10 per share for consulting services totaling $59,000. The number of shares issued was based on the fair market value of the services provided.

In July 2004, the Company issued 293,559 shares of its common stock which represented the common stock to be issued as of June 30, 2004 as part of the June 2004 conversion of convertible notes payable and accrued interest (see Note 4 above).

F-6

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLANS OF OPERATION.

The following discussion and analysis should be read in conjunction with the condensed consolidated financial statements and notes thereto appearing elsewhere in this Quarterly Report on Form 10-QSB. The discussion of the Company’s business contained in this Quarterly Report on Form 10-QSB may contain certain projections, estimates and other forward-looking statements that involve a number of risks and uncertainties, including those discussed below at "Risks and Uncertainties." While this outlook represents management’s current judgment on the future direction of the business, such risks and uncertainties could cause actual results to differ materially from any future performance suggested below. The Company undertakes no obligation to release publicly the results of any revisions to these forward-looking statements to reflect events or circumstances arising after the date hereof.

OVERVIEW

The Company has limited operating history and is no longer in the development stage. Its’ principal business is the exploitation of niche products for the microcomputer industry that provide enhanced system security for both individual users and network administrators. The Company's initial product, Com-Guard™, includes unique software and hardware that enables users to protect and limit access to data and to provide a security system against tampering and unauthorized use of computers.

The Com-Guard™ system monitors a computer or network and detects, through proprietary software and hardware, unauthorized attempts to use, tamper with, or remove data or equipment. The system is designed to generate an alarm, which can be sent to any receiving device, including pagers, telephones, and other computers.

The market for Com-Guard™ consists of individual users and industry. The popularity of the Internet has created a need for both data security and access limitations. Limiting access to sensitive and/or confidential files has grown to be a need for all users of microcomputers.

Home automation, including systems to provide "internal" security to certain areas of a home or office, represents an additional market for Com-Guard™. The system, installed in a PC, has the ability to function as an internal home security system, controlling a series of sensors to protect against theft and intrusion.

The Company has commenced the initial marketing of its products. However, period-to-period financial comparisons may be of limited usefulness now and for the near future as the Company continues to market its products.

We have started efforts to market and sell our products through our website: www.com-guard.com and a number of other commercial websites. In addition, we are working on other avenues of distribution and sales for our products. At the end of fiscal 2004, we formed our PC Products subsidiary that started formal operating activities during the first quarter of fiscal year 2005. In addition to generating potential sales of computers and accessories, which may include the Company’s security products, this subsidiary will be used to generate end-user awareness of our security products. As more fully described below, our PC Products subsidiary accounted for a preponderance of our sales and gross profit during the quarter ended September 30, 2004. We anticipate that this trend will continue for at least the next several quarters.

Funds recently raised through a Private Placement offering have been utilized for marketing and general working capital. We currently anticipate that we have sufficient cash flow for approximately the next twelve months. We will need to improve our working capital position. We will need to increase revenue or raise additional funds to fully develop our business. There can be no assurance, however, that we will be able to complete any additional debt or equity financing on favorable terms or at all, or that any such financings, if completed, will be adequate to meet our capital requirements. Any additional equity or convertible debt financings could result in substantial dilution to our stockholders. If adequate funds are not available, we will be required to delay, reduce or eliminate some or all of our planned activities. Our inability to fund our capital requirements would have a material adverse effect on the Company.

Also See “Risks and Uncertainties” included in this discussion.

1

Results of Operations

 Sales

      Sales for the three months ended September 30, 2004 were $1,702,000 compared to $3,000 for the three months ended September 30, 2003, an increase of $1,699,000. Sales during the three-month period ended September 30, 2003 were entirely due to Internet sales of our downloadable security products. During the three months ended September 30, 2004, such sales only amounted to approximately $1,000.

The remaining sales, during the quarter ended September 30, 2004, were derived from sales of $30,000 of Com Guard’s hardware products, and $1,671,000 of sales of other manufacturers hardware and software products through the Company’s PC Products subsidiary.

 Cost of Goods Sold

 Cost of goods sold for the three months ended September 30, 2004 was $1,579,000. For the three months ended September 30, 2003, there were no such costs. The increase is attributed to the cost of goods sold for the Com Guard’s hardware products of $11,000, and $1,568,000 of cost of goods sold for other manufacturers hardware and software products though the Company’s PC Products subsidiary.

 Selling, general and administrative

For three months ended September 30, 2004, selling, general and administrative were $261,000 compared to $400,000 for the three months ended September 30, 2003, a decrease of $139,000. This decrease was due to reductions in wages attributed to headcount reductions during the periods, and reductions in consulting expenses, legal expenses, and marketing expenses due to limited working capital during the period.

 Liquidity and Capital Resources

      We have financed our operations primarily through cash generated from the sale of our stock and loans to us. We are no longer classified as a development stage company and have commenced the sales and marketing of our products.

 During the three months ended September 30, 2004, the Company incurred a net loss of $145,000 and had negative cash flows from operating activities of $135,000.

 Our security products contain software developed for the hardware circuit boards and we also have software applications that can be sold as separate products. Since hardware related products (1) have a higher cost to manufacture than stand-alone software products, and (2) recent trends showing that end-users are less likely to purchase and install hardware-based products, we are currently placing a strong emphasis on our standard software products to generate revenue. We are developing strategies in certain key target areas to market our hardware/software products.

 For the year ended June 30, 2004, our auditors expressed their uncertainty as to our ability to continue as a going concern. They cite the cash flow deficiency from operations and the minimal capital resources available to meet existing and anticipated obligations. Management’s current plans are: (1) to further commercialize its own products; (2) to market new products, including products from other manufacturers; (3) to continue to operate and improve e-commerce sites to sell its products; and (4) to continue to generate profitable sales and end-user awareness of our security products through our PC Products subsidiary. To successfully execute its current plans, the Company will need to improve its working capital position. The Company plans to overcome the circumstances that impact our ability to remain a going concern through a combination of achieving profitability, raising additional debt and equity financing, and renegotiating existing obligations.

 There can be no assurance, however, that we will be able to complete any additional debt or equity financing on favorable terms or at all, or that any such financings, if completed, will be adequate to meet our capital requirements. Any additional equity or convertible debt financings could result in substantial dilution to our stockholders. If adequate funds are not available, we will be required to delay, reduce or eliminate some or all of our planned activities. Our inability to fund our capital requirements would have a material adverse effect on the Company. 

2

CRITICAL ACCOUNTING POLICIES

The Company believes the following are its most critical accounting policies in that they are the most important to the portrayal of the Company’s financial condition and results and requires management’s most difficult, subjective or complex judgments.

 Inventory Valuation

The Company regularly monitors and assesses its risk of not incurring any material sales of its inventory in the future. This evaluation is based upon the Company’s sales force efforts and information the Company receives from potential customers. Based upon the results of the analysis, the Company recorded a write down for this risk. This analysis requires the Company to make significant estimates, and changes in facts and circumstances could result in material changes in the inventory valuation.

 Revenue Recognition

The Company accounts for the licensing of software in accordance with American Institute of Certified Public Accountants (AICPA) Statement of Position (SOP 97-2, Software Revenue Recognition). The Company recognizes revenue when (i) persuasive evidence of an arrangement exists; (ii) delivery has occurred or services have been rendered; (iii) the sales price is fixed or determinable; and (iv) collectibility is reasonably assured. Post customer support (PCS), if applicable, is recognized on delivery of applicable software. The Company accrues all estimated costs of providing the PCS services, including upgrades/enhancements.

At the time of the transaction, the Company assesses whether the fee is fixed and determinable based on the payment terms associated with the transaction and whether collectibility is reasonably assured. If a significant portion of a fee is due after our normal payment terms, the Company accounts for the fee as not being fixed and determinable. In these cases, the Company recognizes revenue as the fees become due. Where the Company provides or delivers a product or service at a specific point in time and there are no remaining obligations, the Company recognizes revenue upon the delivery of the product or completion of the service.     

RISKS AND UNCERTAINTIES

Risks Relating to Com-Guard.Com, Inc.

Our business is capital intensive and will require additional financing which will result in dilution to existing shareholders which would in turn reduce the share price of earlier issued shares. Our operations are capital intensive and growth will consume a substantial portion of available working capital. We may require additional capital in order to fund our operations. We do not have any commitments for additional financing and there can be no assurance that such additional funding, if required, will be available, or if available, will be available upon favorable terms. With respect to our ability to obtain financing on favorable terms, we do not have significant assets to serve as loan collateral. Still further, we presently do not have a sufficient cash flow to qualify for reasonable debt financing. Insufficient funds may prevent us from implementing our business strategy. In the event we raise additional funds through the issuance of equity securities, dilution to the then existing stockholders will result and future investors may be granted rights superior to those of existing stockholders. Accordingly, such dilution would reduce the share price of the earlier issued shares.

      Lack of operations, positive cash flow and profitability may continue which will affect our ability to remain in business. As of March 31, 2003, planned principal operations have commenced. As such we have a limited history of operations, the generation of positive cash flow or profits in the industries in which we participate. If we do not generate positive cash flow and hence become profitable, we may not be able to remain in business.

Uncertainty of commercial success may affect our ability to remain in business. With respect to our revenue and profitability prospects, we may not be able to achieve commercial success with our Com-Guard product. Furthermore, the computer industry is characterized by rapid change and growth. Accordingly, we may not be able to keep up with the pace of technological change or fund its growth. If we fail to achieve commercial success, we will continue to suffer net losses and we will have to go out of business.

Competition may have an adverse effect on our business. We are subject to competition from other companies that may try to emulate or compete with similar products or services. These competitors have been in the business longer than us and may have large executive and operating staffs. Our prospects may be adversely affected by competition from these companies. The introduction of similar or superior products by current or future competitors could have a material adverse effect on our business and financial condition.

Dependence on management will affect our profitability. Future success depends on the continued services of Dr. Edward W. Savarese, Chief Executive Officer and Joe Sigismonti, President and Chief Operating Officer. The loss of any of their services would be detrimental and could have a material adverse effect on the business, financial condition and results of operations. Future success is also dependent on our ability to identify, hire, train and retain other qualified managerial and other employees. Competition for these individuals is intense and increasing. We may not be able to attract, assimilate, or retain qualified technical and managerial personnel and our failure to do so could have a material adverse effect on the business, financial condition and results of operations.

Dependence on proprietary technology and risks of third party infringement claims could adversely affect our business and results of operations. Although we have received patent protection, that our measures to protect our current proprietary rights may be inadequate to prevent misappropriation of such rights or that our competitors will not independently develop or patent technologies that are substantially equivalent to or superior to our technologies. Additionally, although we believe that our products and technologies do not infringe upon the proprietary rights of any third parties, that third parties may assert infringement claims against products and technologies that we license, or has the rights to use, from third parties. Any such claims, if proved, could materially and adversely affect our business and results of operations. In addition, though any such claims may ultimately prove to be without merit, the necessary management attention to, and legal costs associated with litigation or other resolution of such claims could materially and adversely affect our business and results of operations.

3 

The results of research and development efforts are uncertain and we may not be able to compete effectively in the marketplace. We will need to make additional research and development expenditures to remain competitive. While we perform usability and beta testing of new products, the products we are currently developing or may develop in the future may not be technologically successful. If they are not technologically successful, the resulting products may not achieve market acceptance and these products may not compete effectively with products of competitors currently in the market or introduced in the future. If we are unsuccessful in the marketplace, it may affect our ability to remain in business.

Reliance on third party technologies may result in a decreasing demand for our products and our ability to remain in business affect the value of your investment. Our software products are designed to run on multiple operating systems and integrate with security products from other vendors. Businesses in the corporate market may not adopt such technologies as anticipated or will not in the future migrate to other computing technologies that we do not support. Moreover, if our products and technology are not compatible with new developments from these companies, as to which there can be no assurances, the business, results of operations and financial condition could be materially and adversely affected. If we are unable to successfully and timely develop products that operate under existing or new operating systems, or if pending or actual releases of the new operating systems delay the purchase of products, future net revenues and operating results could be materially adversely affected. Additionally, as hardware vendors incorporate additional server- based network management and security tools into network operating systems, the demand may decrease for some products, including those currently under development. In the event such demand decreases, we will continue to suffer net losses and we will have to go out of business.

Our auditors have expressed doubts about our ability to continue as a going concern which may result in the loss of your entire investment. In preparing our audited financial statements, our auditors have expressed doubts about our ability to continue as a going concern. If we discontinue operations, you will lose your entire investment.

 Risks Relating to Our Common Stock

      Due to the fact that our common stock has recently been listed on the NASD OTC Bulletin Board, there can be no assurance that a regular trading market for our common stock will ever be developed. As such, the investors must be able to bear the financial risk of losing their entire investment. Our common stock was listed on December 24, 2002 on the NASD OTC Bulletin Board under the trading symbol "CGUD." There has been only limited trading activity in our securities at this time. We do not know if a market for our common stock will be established or that, if established, a market will be sustained. Therefore, investors should realize that they may be unable to sell our common stock if they purchase it. Accordingly, investors must be able to bear the financial risk of losing their entire investment in our common stock.

Since a significant portion of our common stock is being registered and may be available for resale, a significant overhang on the market could depress the market price of our stock which will reduce the value of your investment. Following the effective date of the July 14, 2004 registration statement, a maximum of 33,116,331 shares of our common stock will be eligible for resale to the public. This amount of common stock represents a significant overhang on any market that may develop for our common stock. If a substantial number of shares in this overhang were sold in a short period of time, any market for our common stock could be dramatically depressed which will result in a reduction of the value of your investment.

Lack of dividends may affect the value of your investment when compared to comparable stock which does pay a dividend. We have never paid a cash dividend on our common stock. We are not obligated to pay a dividend on our common stock and do not anticipate payment of any dividends for the foreseeable future. We anticipate retaining our earnings to finance our operations, growth, and expansion. The value of your stock may be reduced in that prospective buyers may prefer a stock which does pay a dividend.

Potential volatility of stock price will affect the value of our common stock. There can be no assurance that an active public trading market can be established or sustained. Furthermore, if a regular trading market for the common stock is established, the shares could be subject to significant fluctuations in response to operating results and other factors, many of which are not within our control. Accordingly, you may not be able to obtain a satisfactory price for your shares if you need to sell some or all of your shares at a time when the shares may be depressed.

Dividends

The Company has never paid any cash dividends on its capital stock. The Company currently anticipates that it will retain all available earnings for use in the operation and expansion of its business, and does not anticipate paying any cash dividends in the foreseeable future.

ITEM 3. CONTROLS AND PROCEDURES

Evaluation of disclosure controls and procedures. Edward W. Savarese, our Chief Executive Officer and acting Chief Financial Officer, has preformed an evaluation of the Company’s disclosure and procedures, as that term is defined in Rule 13a-14(c) of the Securities Exchange Art of 1934, as amended (the “Exchange Act”), as of the end of the period covered by this report and each has concluded that such disclosure controls and procedures are effective to ensure that information required to be disclosed in our periodic reports filed under the Exchange Act is recorded, processed, summarized and reported, within the time period specified by the Securities and Exchange Commission’s rules and regulations.

Changes in internal controls. No significant changes in the Company’s internal controls or in other factors that could significantly affect these controls were made as a result of the evaluation.

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PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

None.

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS

In July 2004, a total of 595,000 shares of common stock were issued in consideration of various consulting services provided to Com-Guard with an aggregate value of $59,000.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None

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

None.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits:      

 None

(b) Reports on Form 8-K:

 None.

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SIGNATURES

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

Dated: November 19, 2004

COM-GUARD.com, INC.

By: /s/ Edward Savarese   Edward W. Savarese Chief Executive Officer and Acting Chief Financial Officer

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