SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                               ------------------

                                   FORM 10-KSB

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

                   For the fiscal year ended December 31, 2003

                                       or
            Transition Report Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934

                  For the Transition period from       to
                                                 -----    -----

                         Commission file number 0-14039

                                 eNUCLEUS, INC.
                  --------------------------------------------
                 (Name of small business issuer in its charter)

                 Delaware                                 11-2714721
          ----------------------             ----------------------------------
         (State of incorporation)           (I.R.S. Employer Identification No.)

            4000 Main Street
          Bay Harbor, Michigan                               49770
 --------------------------------------                     --------
(Address of principal executive offices)                   (Zip Code)

                                 (231) 439-2708
                ------------------------------------------------
               (Registrant telephone number, including area code)

           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

     Check whether the issuer (l) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter periods that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
                                 Yes  X  No
                                    -----  -----

     Check if there is no disclosure of delinquent filers in response to Item
405 of Regulation S-B contained in this form, and no disclosure will be
contained, to the best of the registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-
KSB or any amendment to this Form 10-KSB. [ ]

     The issuer's revenues were approximately $600,000 for the year ended
December 31, 2003.

     As of March 31, 2004, the market value of the issuer's common stock held by
non-affiliates was approximately $1,000,000.

     Check whether the issuer has filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court. Yes  X  No
                                                 -----  -----

       As of March 31, 2004, the number of common stock shares outstanding
is approximately 18,172,729 shares.

                      DOCUMENTS INCORPORATED BY REFERENCE--

   Transitional Small Business Disclosure Format (check one) Yes     No  X
                                                                -----  -----

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                                 eNUCLEUS, INC.

                                   FORM 10-KSB

                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----
ITEM 1  DESCRIPTION OF BUSINESS...........................................    2

ITEM 2  DESCRIPTION OF PROPERTIES.........................................    5

ITEM 3  LEGAL PROCEEDINGS.................................................    5

ITEM 4  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS...............    5

ITEM 5  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDERS MATTERS.........    6

ITEM 6  MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
        AND RESULTS OF OPERATIONS.........................................    8

ITEM 7  FINANCIAL STATEMENTS AND SUPPLEMENTAL DATA........................   17

ITEM 8  CHANGE IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
        AND FINANCIAL DISCLOSURE..........................................   17

ITEM 8A CONTROLS AND PROCEDURES...........................................   17

ITEM 9  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS,
        COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT.................   18

ITEM 10 EXECUTIVE COMPENSATION............................................   18

ITEM 11 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS...................   19

ITEM 12 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS....................   20

ITEM 13 EXHIBITS AND REPORTS ON FORM 8-K..................................   21

ITEM 14 PRINCIPAL ACCOUNTANT FEES AND SERVICES............................   21

SIGNATURES................................................................   21

EXHIBIT INDEX.............................................................   22

INDEX TO FINANCIAL STATEMENTS.............................................  iii

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION

     Some of the statements contained in this Form 10-KSB under the captions
"Business" and "Management Discussion and Analysis of Financial Condition and
Results of Operations" and in other places are "forward-looking statements."
Forward-looking statements include statements that relate to our beliefs or
expectations as to future events and statements that are not historical facts.
In some cases, you can identify these statements by forward-looking words such
as "may", "might", "will", "should", "expects", "plans", "anticipate",
"believe", "estimate", "intend", the negative of these terms and other
comparable terminology. Because forward-looking statements involve this risk and
uncertainty, there are important factors that could cause actual results, level
of activity, performance or achievements to differ materially and adversely from
those expressed or implied by the forward-looking statements. These factors,
which should be carefully considered by you, include, among other things:

     o    general effects of our restructuring and emergence from Chapter 11
          reorganization,

     o    the availability and terms of capital to finance our operations, and

     o    continuing development of our products and solutions,

     o    successful build out of out distribution channels,

     o    general economic and business condition, both nationally and
          regionally,

     o    competition from others in the industry, whether existing or new,

     o    the experience level of our management team,

     o    changes in our business strategy or growth plans,

     o    our ability to attract and retain qualified personnel,

     o    other factors discussed under "Management Discussion and Analysis of
          Financial Condition and Results of Operations-- Factors Affecting
          Future Operations."

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PART I

ITEM 1      DESCRIPTION OF BUSINESS

General

  eNucleus, Inc. ("eNucleus" or the "Company") is a next generation software and
managed hosting company. eNucleus' business strategy is to acquire companies
that have proprietary software applications that fulfill core and niche business
processes (i.e., Enterprise Resource Management ("ERP"), Customer Resource
Management ("CRM"), Integrated IP Communications, Sales Automation, Tracking) in
specific market verticals (i.e. Healthcare, Education, Distribution Services and
Financial Services). We are particularly focused on products that enjoy strong
customer loyalty and can be enabled for delivery over the Internet for a
recurring monthly fee on either a managed hosting or pure ASP basis.

Strategy

          Our goal is to become a recognized leader in application delivery and
managed IT services industry. eNucleus' business strategy is to offer ebusiness
solutions through the acquisition of leading software companies in specific
vertical markets that enjoy strong customer loyalty with applications that can
be enabled for delivery over the Internet for a recurring monthly fee. By
spreading the network infrastructure costs over multiple companies and other
economies of scale, our business strategy can increase overall profitability
while reducing risk associated with owning a single application or targeting a
single market segment.

          In pursuit of this goal eNucleus generally follows the following
strategic operating principles:

     o    Acquire best-of-breed applications - Our focus is on acquiring niche
          software applications that serve defined market segments that serve
          defined market segments, enjoy widespread industry support and can be
          readily enabled for deployment over the Internet through our software
          application network.

     o    Acquire well-managed companies - eNucleus concentrates on acquiring
          well-managed organizations that demonstrate a potential for
          significant cash flow growth as a result of product enhancements and
          improved marketing. Our strategy is to oversee already existing,
          strong management teams and to enhance those acquired companies with
          capital, national presence, consolidated operating costs, strategic
          marketing and the technical expertise for migrating their products to
          an Internet-based delivery system.

     o    Leverage operating costs - Each software acquisition presents an
          opportunity for creating operating savings through the consolidation
          of duplicate business functions. Labor costs can be further reduced by
          bringing a seasoned programming team with proven methodology to each
          newly acquired software application. This experienced team skill set
          should result in quicker times to market when enabling new software
          applications for delivery over the Internet than could be achieved by
          less experienced service providers.

     o    Recurring monthly revenue streams - eNucleus employs pricing
          strategies that focus on developing long-term recurring monthly
          revenue streams rather than high upfront purchase prices. Lower
          upfront costs makes it easier for customers to transition into a new
          business model. As their future needs grow with business demand, we
          believe that customers which have transferred critical business
          operations into the eNucleus network are more like to maintain their
          services with eNucleus.

     o    World Class Customer Service - eNucleus supports its products and
          services by world-class customer care personnel who monitor, manage
          and deploy our services.

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Market Environment

          Software industry experts have most recently stated that they
anticipate Internet-based models of software delivery will be the migration path
for most software applications in the foreseeable future due to the cost savings
and broader accessibility of critical business information that these methods
provide. The convergence of these factors suggests that the next major shift in
how computer based technology is utilized in business will focus on the
reduction of capital expenditures on costly internal IT infrastructure in favor
of accessing critical applications and essential business processes solely
through the Internet. As a next generation business process hosting company with
a scalable nationwide infrastructure available, we believe eNucleus is
positioned to provide critical Internet based business processes to companies
that want to reduce their IT infrastructure.

          This current market environment would appear to have created
opportunities within the software industry in which numerous software products
currently enjoy market favor and a loyal customer base; however, many previously
successful applications are not presently delivered over the Internet and many
vendors lack the technical skill set or necessary Internet network
infrastructure to enable and deliver their software applications in this manner.
Their situation is further complicated by the limited availability of
development monies within today's capital markets. This has resulting in
software companies being forced to delay product conversions to web-based
platforms or to re-invest their earnings into efforts to re-tool for the
Internet--with neither being an attractive alternative for companies trying to
protect their bottom line in today's economy.

Products and Services

          Our products and services include:

     o    Application Delivery - We deliver and manage applications and computer
          services from a centralized location to multiple users over the
          Internet and/or a private network. This provides our customers with
          the ability to access software applications anywhere, anytime via the
          Internet. Applications are accessed just as if they were installed on
          the local system. Within this environment, we provide our customers
          with the ability to access their applications as well as our other
          products.

     o    Managed hosting -- We deliver full service solutions for establishing
          and maintaining the complex infrastructure necessary for a business to
          support ebusiness applications and delivery. State-of-the-art servers
          provide a solid platform for hosting client's mission critical
          applications and data. eNucleus support provided by our managed
          hosting services include 24x7 network monitoring and support, system
          administration, server monitoring and testing, usage reporting,
          security services and protection. All the while, customers can still
          maintain control over the software and solutions housed on the
          servers, including their customized installed software and proprietary
          solutions.

     o    Data Storage - Our data storage services include high performance
          network backup and storage to cost-effective specific data tape backup
          services, offsite storage and data vaulting

Sales and Marketing

          Our sales and marketing efforts are dedicated to increasing the
awareness of our Internet-based solution opportunity and the eNucleus brand. We
are implementing a brand development program designed to portray us as a
national company with a local presence.

          Our sales and marketing group consists of sales professionals and
technicians teamed within our regional operations. We intend to add sales and
marketing personnel.

          We intend to use a mix of programs to deliver our message and create a
demand for our products and services. Marketing programs will include:

     o    Focused Marketing -- eNucleus focuses its direct marketing efforts on
          prospects within its identified market verticals.

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     o    Cross-selling strategies - eNucleus intends to capitalize on
          cross-selling opportunities generated by its acquisitions.

     o    Personal Contact - eNucleus direct sales staff concentrates its
          efforts on contacting potential customers within each market vertical
          that have had no previous experience with earlier software releases or
          web-enabled software in general.

     o    Industry Specific Advertising - eNucleus complements each application
          division's sales efforts with general advertising in trade
          publications of specific industry verticals that eNucleus or its
          subsidiaries service.

Competition

          The market for Internet-based technology solutions is intensely
competitive, rapidly evolving and subject to rapid technological change. We
expect competition to persist, intensify and increase in the future. We believe
that the principal competitive factors in our market are single source,
strategic expertise, technical knowledge, best of breed products and services,
reliability, client service and price. Most of our current and potential
competitors have longer operating histories, larger installed client bases,
longer relationships with customers and significantly greater financial,
technical, marketing and public relations resources than us that could decide at
any time to increase their resource commitments to our market. In addition, the
market for Internet solutions is relatively new and subject to continuing
definition, and, as a result, the core business of certain of our competitors
may better position them to compete in this market as it matures. Competition of
the type described above could materially adversely affect our ability to
realize our goals.

There are relatively low barriers to entry into our business. There can be no
assurance that existing or future competitors will not develop or offer services
that provide significant performance, price, creative or other advantages over
those offered by us, which could have a material adverse effect on our business,
results of operations and financial condition.

History

          eNucleus began business operations in 1984 in Colorado Springs,
Colorado, as a provider of computer systems and componentry. We adopted the name
eNucleus, Inc. in 2000 as the business evolved to include Internet-based
technology solutions, hosting, access and managed services.

          On May 10, 2002, as a result of dramatic changes in the Internet
industry and financing markets, we filed a voluntary petition for reorganization
under Chapter 11 of the United States Bankruptcy Code in the U.S. Bankruptcy
Court for the Northern District of Illinois, Eastern Division. We continued to
operate as a debtor-in-possession under the supervision of the Bankruptcy Court.
On November 6, 2002, the Company's Plan of Reorganization was confirmed and on
November 6, 2003 the Company received its final decree, thereby enabling the
Company to successfully emerge from its Chapter 11 reorganization.

          As part of our Plan of Reorganization, we entered into a borrowing
facility with Sunami. Pursuant to the Sunami financing agreement, in December,
2001, we also entered into a three-year $545,000 secured demand loan agreement
with Capital Equity Group. During the second quarter of 2002, Capital Equity
Group notified us that they would not be able to satisfy the lending
requirements of the facility. In May of 2003 as a result of CEG/Hanover
Capital's inability to finance the Company as prescribed under the Plan the
Company's secured lender, Bank of America, along with other administrative
claimants sought the conversion of eNucleus' Chapter 11 filing to be converted
to a Chapter 7 liquidation. In October of 2003 the Company entered into certain
funding and debt conversion agreements with Congruent Ventures, LLC and Monte
Carlo Funding Corp. which allowed the Company to fulfill its requirements under
the Plan of Reorganization and receive its final decree from the Bankruptcy
court on November 6, 2003, thereby enabling the Company to successfully emerge
from its Chapter 11 reorganization.

          During 2002, the company completed one acquisition, Strategic Business
Group ("SBG") a company specializing in a proprietary methodology for critical
process mapping, which allows customers to map current business processes as

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well as the transitional processes that will be required to implement software
solutions acquired from eNucleus. Additionally, SBG has extensive experience in
software selection, implementation and process improvement consulting.
Consideration paid was through the assumption of certain net liabilities of
approximately $100,000 and a stock earn-out over the subsequent twenty-four
month period equal to 50% of the net earnings of the acquired asset operations.
In the fourth quarter of 2003, this agreement was terminated and the stock due
under the earn out provision was included within an overall settlement made with
the original principal shareholder of SBC.

          In May 2003 the Company announced that we had signed an agreement for
the acquisition of certain assets and operations of Millennium Information and
Technology Consultants, LTD. ("MIT"). Upon final due diligence and review, it
was decided that the acquisition would not be concluded but rather a strategic
relationship would be entered into, thereby giving eNucleus access into the
MIT'S resources and client relationships and giving MIT access to resell
eNucleus' product offerings and services. At the time of this filing the
strategic relationship had not been concluded.

          In December 2002, the Company decided to close its data center
facility in Atlanta and more fully capitalize on its strategic relationship with
its collocation facility partner. As a result of this decision, the Company
recorded a charge for an impairment of goodwill of approximately $2.5 million
and a write-off of fixed assets of approximately $1.1 million. During 2003, the
Company recorded an impairment related to the goodwill associated with the
Company's most recent acquisitions, including Strategic Business Group and costs
incurred related to MIT Consulting, eliminating $170,000 representing the
remaining goodwill associated with these transactions and also recorded a
write-off of fixed assets of approximately $330,000 due to the devaluation and
disposal of equipment.

Employees

          As of April 12, 2004 we employed 11 full time personnel . We also
contract with several outside parties to provide certain engineering, sales and
administrative services on an as needed basis. Our employees are not subject to
collective bargaining agreements and we consider our relationships with our
employees to be good.

ITEM 2            DESCRIPTION OF PROPERTIES

          eNucleus' maintains its executive office at 4000 Main Street, Bay
Harbor, MI 49770. We also lease certain operating facilities in Chicago,
Illinois and Marietta, Georgia as part of our operating procedures. The various
leases for our facilities are month to month. We are currently evaluating our
options on existing and new office space.

ITEM 3            LEGAL PROCEEDINGS

          On May 10, 2002, as a result of dramatic changes in the Internet
industry and financing markets, we filed a voluntary petition for reorganization
under Chapter 11 of the United States Bankruptcy Code in the U.S. Bankruptcy
Court for the Northern District of Illinois, Eastern Division. We continued to
operate as a debtor-in-possession under the supervision of the Bankruptcy Court.
On November 6, 2002, the Company's Plan of Reorganization was confirmed and on
November 6, 2003 the Company received its final decree, thereby enabling the
Company to successfully emerge from its Chapter 11 reorganization.

          We are from time to time a party to various legal actions arising in
the normal course of business. Prior to our filing for protection under
bankruptcy, we were a party to several creditor collection actions. However, as
a result of our bankruptcy filing, these matters and many other threatening
proceedings have been resolved and terminated. We believe that there is no
proceeding threatened or pending against us which, if determined adversely,
would have a material adverse effect on the financial condition or results of
operations of eNucleus.

ITEM 4            SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

          Subsequent to year-end, the Board of Directors authorized and
shareholders approved a one for ten reverse stock split of all issued and
outstanding common stock, effective February 18, 2004. The par value of the
common stock was maintained at the pre-split amount of $.001 per share and the

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authorized capital was maintained at 100,000,000 shares of common stock, and the
par value of the preferred stock was maintained at the pre-split amount of
$0.001 per share, and the authorized capital was maintained at 20,000,000 shares
of preferred stock. All references to common shares and per share amounts in
these consolidated financial statements and notes to consolidated financial
statements have been restated to reflect this reverse stock split on a
retroactive basis, exclusive of fractional shares. No matters were submitted to
a vote of security holders during the fourth quarter of 2003.

PART II

ITEM 5            MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDERS MATTERS

         Our common stock is traded on the NASDAQ OTC Bulletin Board (OTCBB)
under the symbol ENUI. Prior to December 2003, our stock was traded under the
symbol ENCU. As yet, our common stock has experienced limited trading activity.
A public trading market having the characteristics of depth, liquidity and
orderliness depends upon the existence of market makers as well as the presence
of willing buyers and sellers, which are circumstances over which we do not have
control. The following table sets forth, for the periods indicated, the range of
high and low bid quotations per share of common stock as reported by NASD on the
OTC Bulletin Board.

                                                    Common Stock
                                                    ------------
            Period                                  Low Bid (1)    High Bid (1)
            ------                                  -----------    ------------

            2004
              1st Quarter through April 12, 2004        $  0.31         $  0.55

              2003
              4th Quarter                               $  0.18         $  0.75
              3rd Quarter                               $  0.17         $  0.68
              2nd Quarter                               $  0.14         $  0.95
              1st Quarter                               $  0.18         $  1.20

              2002
              4th Quarter                               $  3.00         $ 18.00
              3rd Quarter                               $  2.00         $ 35.00
              2nd Quarter                               $  1.00         $ 60.00
              1st Quarter                               $  1.00         $ 30.00
            (1) Stock prices are reflective of the reverse stock splits.

          The approximate number of record holders of our common stock on April
12, 2004 was 500, as shown on the records of our transfer agent and registrar of
the common stock. Since many shares may be held by investors in nominee names,
such as the name of their broker or their broker's nominee, the number of record
holders often bears little relationship to the number of beneficial owners of
our common stock.

          Pursuant to the Plan of Reorganization, we filed an Amended and
Restated Certificate of Incorporation with the Delaware Secretary of State. In
accordance with the Plan, all outstanding shares of old common stock (ENCS) and
warrants and options to purchase old common stock were cancelled. As part of the
distribution of the New Common Stock under the Plan of Reorganization,
shareholders were to tender their Old Common Stock to the Reorganized Company's
designated Stock Transfer Agent no later than October 15, 2002, in accordance
with written instructions provided to such holders, and in exchange would
receive one share of new common stock for every six shares of old common stock
previously owned. Any shareholder who did not submit its certificates for
exchange prior to October 15, 2002 had its claim or interest and its
distribution pursuant to the Plan of Reorganization on account of such Old
Common Stock discharged and shall be forever barred from asserting any such
claim or interest against the Reorganized Company or their respective property.
Approximately 180,000 shares of new common stock were issued under this
exchange. Additionally, approximately 280,000 shares were issued in exchange for
holders of certain allowed claims under the Plan of Reorganization. Such holders
of allowed claims received 1 share of common stock for every $30.00 of debt
claim approved. Any creditor who did not submit its appropriate paperwork for
the stock exchange prior to December 23, 2003 had its claim or interest and its

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distribution pursuant to the Plan of Reorganization on account of such claim
discharged and shall be forever barred from asserting any such claim or interest
against the Reorganized Company or their respective property. Pursuant to
Company's final restructuring, we filed an Amended and Restated Certificate of
Incorporation with the Delaware Secretary of State. In accordance with the
restructuring, all outstanding shares of old common stock (ENCU) under went a
One for Ten reverse split and the new common stock trades under the symbol ENUI.

          We have paid no dividends on our common stock. There are no
contractual restrictions on our ability to pay dividends. We have not had
earnings that indicate an ability to pay cash dividends. We have a Stock
Purchase Plan for non-qualified options and an Incentive Stock Option Plan for
incentive stock options. Under the plans, all our employees, together with other
persons who perform substantial services for us or on our behalf, will be
eligible to receive incentive and non-statutory options to purchase eNucleus
common stock. The plans are administered by the Board of Directors. Under the
plans, the exercise price at which the shares of eNucleus common stock covered
by each grant may be purchased will be determined on the date of grant by the
committee, but can be no less than the par value of such shares and, in the case
of incentive stock options, may not be less than the fair market value of such
shares on the date of grant. The number of shares covered under the options
granted under the plans are subject to adjustments for stock splits, mergers,
consolidations, combinations of shares, reorganizations and other
recapitalizations.

          In accordance with the Plan of Reorganization, we agreed to issue
warrants to purchase 100,000 shares of post split common stock to certain
unsecured creditors (those creditors who appropriately completed and submitted
the required paperwork for the exchange of stock for their debt in accordance
with the Plan of Reorganization) pro rata in accordance with the amount of their
allowed claims. The Warrants give the holders thereof the right to purchase, at
any time for a period of seven years from the date of issuance (i.e., the
effective date of the Plan), one share of the New Common Stock at a price of Two
Dollars ($2.00) per share. The Warrants also contain a "Cashless Exercise"
provision which provide that in the event the stock has traded at an average
price in excess of $20.00 per share for at least 30 days preceding an exercise
of any warrants, the holders thereof may elect to exercise the Warrants in whole
or in part and instruct the Company to withhold from the securities issuable
upon exercise, a number of securities, valued at the current fair market value
on the date of exercise, as the payment of the exercise price. The Company has
not yet issued these warrants.

          Recent Sales of Unregistered Securities.

          As part of the Plan of Reorganization, the Company entered into a
borrowing facility with Sunami. In accordance with the Plan of Reorganization,
Sunami (or others who shall provided post-petition financing) shall receive on
account of the borrowings, five shares of New Common Stock for every ten dollars
loaned and a Senior Secured Note for the amount of the borrowings. As of
December 31, 2003, eNucleus has received approximately $1 million of value under
this facility the proceeds of which have been used to satisfy certain petitions
resulting from the bankruptcy and post-petition operating requirements. During
2002, Sunami agreed to convert approximately $700,000 of Senior Secured Note
into equity and the remaining was converted into equity during 2003.

          Pursuant to the Sunami financing agreement, in December, 2001, the
Company also entered into a three-year $545,000 secured demand loan agreement
with Capital Equity Group. The note agreement is secured by certain of our
assets, guaranteed by John Paulsen, our CEO and bears interest at the rate of
16%. During the second quarter of 2002 Capital Equity Group notified the Company
that they would not be able to satisfy the lending requirements of the facility
(the Company received approximately $212,000 under this facility). As part of
the emergence from bankruptcy in November 2003, the Company reached agreement
with the holders of such notes to convert into equity.

          During 2003, the Company has issued approximately 100,000 shares of
common stock subject to an investment banking and acquisition support consulting
agreement, 170,000 shares pursuant to a financing arrangements, 200,000 shares
for investor relations and marketing support, 750,000 shares pursuant to debt
conversion agreements and 340,000 shares to certain employees pursuant to their
employment agreements and/or in lieu of cash compensation during the period. As
part of the Company's emergence from bankruptcy in November 2003, the Company
reached agreement with certain note holders and creditors for the agreement to
convert approximately $2 million of outstanding and contingent obligations into

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4.7 million shares of common stock and 1.5 million shares of Series A
Convertible Preferred Stock, which have a conversion rate of 5 shares of common
stock for each share of Series A Preferred Stock.

     Subsequent to year end, the Company privately sold 277,778 shares of Series
B Preferred stock along with a warrant to purchase 250,000 shares of Series B
preferred stock at the face value of $1.00 per share for the consideration of
$250,000 in funding.

          At various times during 2002, certain holders of debts outstanding
agreed to convert amounts outstanding into new common stock. A total of $2.6
million of obligations agreed to conversion, including $900,000 of future lease
obligations under the termination of the data center lease, $700,000 of
financing provided through Sunami and $1 million of post-petition administrative
claims. Approximately 1.2 million shares were issued in conjunction with these
conversions. Associated with the post-petition administrative claims conversions
are certain clauses that could result in additional shares being issued to the
creditors or shares being returned to the Company, based upon certain future
stock prices and/or the eventual liquidation prices achieved by the shareholders
in relation to their cost basis. On December 2, 2002 the Company issued 5,000
shares of common stock in connection with its acquisition of Strategic Business
Group, Inc. ("SBG"). Additionally, the principal shareholder of SBG will be
entitled to a stock earn out over the subsequent twenty-four month period equal
to 50% of the net earnings of the acquired asset operations. In the fourth
quarter of 2003, this agreement was terminated and the stock due under the earn
out provision was included within an overall settlement made with the original
principal shareholder of SBC.

          The Common Stock distributed pursuant to the Plan of Reorganization in
exchange for a claim against, an interest in or a claim for an administrative
expense in the bankruptcy case concerning the Company; or principally in
exchange for financing, service or property while under jurisdiction of the
court has been issued pursuant to an exemption from registration under federal,
state or local securities laws provided by Section 1145(a)(I) of the Bankruptcy
Code. Unless otherwise provided for above, we believe that the common stock
issued in the above transactions qualifies for the exemption provided under
Section 1145(a)(I) of the Bankruptcy Code. Recipients of securities considered
exempt from registration under Section 4(2) of the Securities Act represented
their intentions to acquire the securities for investment only and not with a
view to or for sale in connection with any distribution thereof. In each
instance, offers and sales were made without any public solicitation. No
underwriter or broker-dealer was involved in the transactions and no commission
was paid. All recipients had adequate access to information about eNucleus.

          Subsequent to year end, the Company has issued approximately 500,000
shares of common stock, including 440,000 shares pursuant to a financing
arrangement, 55,000 shares subject to a settlement and conversion of certain
liabilities outstanding .

     Subsequent to year-end, the Board of Directors authorized and shareholders
approved a one for ten reverse stock split of all issued and outstanding common
stock, effective February 18, 2004. The par value of the common stock was
maintained at the pre-split amount of $.001 per share and the authorized capital
was maintained at 100,000,000 shares of common stock, and the par value of the
preferred stock was maintained at the pre-split amount of $0.001 per share, and
the authorized capital was maintained at 20,000,000 shares of preferred stock.
All references to common shares and per share amounts in these consolidated
financial statements and notes to consolidated financial statements have been
restated to reflect this reverse stock split on a retroactive basis, exclusive
of fractional shares.

     Subsequent to year end, the Company privately sold 277,778 shares of Series
B Preferred stock along with a warrant to purchase 250,000 shares of Series B
preferred stock at the face value of $1.00 per share for the consideration of
$250,000 in funding.

ITEM 6            MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

          The following discussion should be read in conjunction with the
financial statements of eNucleus appearing later in this Form 10-KSB. This
discussion and analysis contains forward-looking statements that involve risks,
uncertainties and assumptions. Our actual results may differ materially from
those anticipated in these forward-looking statements as a result of certain
factors, including, but not limited to, those set forth under the caption "--
Factors Affecting Future Results."

          eNucleus, Inc. ("eNucleus" or the "Company") is a next generation
software and managed hosting company. eNucleus' business strategy is to acquire
companies that have proprietary software applications that fulfill core and
niche business processes (i.e., Enterprise Resource Management ("ERP"), Customer
Resource Management ("CRM"), Integrated IP Communications, Sales Automation,
Tracking) in specific market verticals (i.e. Healthcare, Education, Distribution
Services and Financial Services). We are particularly focused on products that
enjoy strong customer loyalty and can be enabled for delivery over the Internet
for a recurring monthly fee on either a managed hosting or pure ASP basis.

                                       8

<PAGE>
<TABLE>
<CAPTION>


          We presently earn revenues from the following product and service
offerings: application delivery, process mapping, Internet transport, data
storage, monitoring, email services, software solutions and set up fees. We
recognize revenue for set up fees over the contract terms. Customers are billed
for the services over the course of an engagement at a measured rate or on a
recurring fixed-price basis. Operating expenses consist primarily of direct
labor and benefits, subcontracted labor or other outside services, commissions,
sales and support personnel and advertising costs. Depreciation and amortization
expense consists primarily of the depreciation of our fixed assets. We expect
these expenses to increase in the future due to the growth of the company.

          On November 6, 2003, eNucleus received its final decree from the
United States Bankruptcy Court for the Northern District of Illinois,
successfully concluding the Company's restructuring and emergence from
bankruptcy. Although the Plan resulted in a substantial reduction in debt,
further improvements in our liquidity position will be subject to the success of
initiatives we are undertaking to increase sales, reduce operating expenses and
he effects on our liquidity of market conditions in the industry. Our uses of
capital are expected to include working capital for operating expenses and
satisfaction of current liabilities, capital expenditures and payments on
outstanding debt facilities.

          During 2003 and as a result of the emergence from bankruptcy, the
Company incurred significant reorganization and restructuring expenses,
including additional expenses incurred in settling outstanding liabilities of
$280,000, professional fees of $290,000 and a write-off of fixed assets of
$330,000 due to the devaluation and disposal of equipment. Reorganization costs
recognized during 2002 include $900,000 related to the buyout of our lease,
write-off of $1.1 million of fixed assets associated with the build-out of the
data center and a $2.5 million charge for the impairment of intangible assets

Business Strategy

          Our business strategy is to offer ebusiness solutions through the
acquisition of leading software companies in specific vertical markets that
enjoy strong customer loyalty with applications that can be enabled for delivery
over the Internet for a recurring monthly fee. By spreading the network
infrastructure costs over multiple companies and other economies of scale, our
business strategy can increase overall profitability while reducing risk
associated with owning a single application or targeting a single market segment

Operating Results 2003 to 2002

          The financial statements after the Confirmation Date are those of a
new reporting entity (the "Reorganized Company") and are not comparable to the
pre-confirmation periods of the old reporting entity (the "Predecessor Company".
The following table sets forth our results of operations for the periods
indicated.

                                                                     Year ended December 31,
                                                             2003                              2002
                                                             ----                              ----
                                                    Amount          Percent          Amount           Percent
                                                    ------          -------          ------           -------
<S>                                                <C>               <C>            <C>                <C>
 Revenue                                           $577,574          100.0%         $285,687           100.0%

 Operating expenses                                 980,412          169.7%        1,153,272           403.7%
 Net reorganization expense                         897,182          155.3%        4,517,579          1581.3%
 Depreciation and amortization expense              150,965           26.1%          375,621           131.5%
                                          --------------------------------------------------------------------
                                                                    (251.2)%                        (2016.5)%
 Operating loss                                  (1,450,985)                      (5,760,785)

 Interest and other income (expense)                -10,305          (1.8)%            3,157             1.1%
 Income tax expense                                       0                              -
                                          --------------------------------------------------------------------
 Net loss                                       ($1,461,290)        (253.0)%     ($5,757,628)       (2015.4)%
                                               =============       ========     =============       =========

 Basic and diluted net loss per common               ($0.28)                          ($2.50)
 common share                                       =======                          =======

 Weighted average shares outstanding -            5,250,310                        2,300,625
 basic and diluted                                =========                        =========

                                                      9
</TABLE>

<PAGE>


Year Ended December 31, 2003 Compared to Year Ended December 31, 2002

          Revenue. For 2003, revenues were $578,000 compared to $286,000 for
2002. Our operations immediately following our bankruptcy petition and
throughout the date of this filing, have been substantially limited to securing
the financing needed to enable the Company to complete its restructuring,
completing its required filings with the Securities and Exchange Commission and
fulfilling its obligations pursuant to the Plan of Reorganization. We have begun
an aggressive strategy to increase our revenues and operations. In December
2002, we completed our first acquisition since reorganization which assisted in
our revenue growth for 2003, accounting for the majority of the growth from
2002.

          Operating expenses. For 2003, operating expenses decreased
approximately $173,000 to $980,000 from $1,153,000 in 2002. The majority of the
decrease relates to a close monitoring and reduction of salaries and other
operating expenses associated with the our facility in Atlanta, prior to closing
and one less month of operating expenses due to its closure.

          Net reorganization expenses. Costs incurred by the company include
professional fees, court costs and other expenses associated with the Chapter 11
proceedings as well as fees incurred in its restructuring of its business.
During 2003 and as a result of the emergence from bankruptcy, the Company
incurred significant reorganization and restructuring expenses, including
additional expenses incurred in settling outstanding liabilities of $280,000,
professional fees of $290,000 and a write-off of fixed assets of $330,000 due to
the devaluation and disposal of equipment. Reorganization costs recognized
during 2002 include $900,000 related to the buyout of our lease, write-off of
$1.1 million of fixed assets associated with the build-out of the data center
and a $2.5 million charge for the impairment of intangible assets

          Depreciation and amortization expense. Depreciation and amortization
expense decrease $225,000 to $151,000 in 2003 as compared to $376,000 in 2002.
The decrease was primarily a result of the write off of $1.1 million of fixed
assets in conjunction with the close of our Atlanta data center facility in the
fourth quarter 2002.

          Interest and other income/expenses. Interest and other expenses in
2002 represents interest accruing on post-petition borrowings offset by a
$22,000 adjustment reflected from a settlement in interest due and payable
achieved with one of our creditors.

          Net loss. Our net loss was $1,461,000 for 2003 compared to a loss of
$5,758,000 in 2002. Excluding the impact of certain non-cash and non-recurring
expenses, including stock based compensation and expenses, the bankruptcy
related expenses, and depreciation, net loss was $403,000 in 2003 compared to
$868,000 in 2002. This reduction of loss is a result of the Company's continued
cost containment and reduction efforts, increased sales efforts of its products
and a result of profitable acquisitions.

For the year ended December 31, 2002

          Revenues. Revenues were $286,000 in 2002 representing operations from
our managed services and one month's operations of our first acquired company in
December 2002.

          Operating expenses. Operating expenses were $1.2 million in 2002.
Operating expenses consist primarily of direct labor and benefits of our
technicians and administration, subcontracted labor or other outside services,
commissions, sales and support personnel and advertising costs.

                                       10

<PAGE>


          Net reorganization expenses. Reorganization costs recognized during
2002 include $900,000 related to the buyout of our lease, write-off of $1.1
million of fixed assets associated with the build-out of the data center and a
$2.5 million charge for the impairment of intangible assets.

          Depreciation and amortization expense. Depreciation and amortization
expense was $376,000 in 2002 primarily resulting from depreciation expense
associated with the build-out assets of the Atlanta Data Center prior to
discontinuance.

          Interest and Other Expense. Interest expense was $84,000 in 2002,
offset by $87,000 of miscellaneous income related to the restructuring of a note
outstanding.

Liquidity and Capital Resources

          On November 6, 2003, eNucleus received its final decree from the
United States Bankruptcy Court for the Northern District of Illinois,
successfully concluding the Company's restructuring and emergence from
bankruptcy. Although the Plan resulted in a substantial reduction in debt,
further improvements in our liquidity position will be subject to the success of
initiatives we are undertaking to increase sales and reduce operating expenses.

          As shown in our results of operations, we continue to incur losses
from operations. During 2003, we incurred a net loss of $1.5 million, of which
approximately $1.05 million, relates to non-cash charges for stock based
compensation and expenses, bankruptcy related expenses and depreciation and
amortization charges. During 2002, we incurred a net loss of $5.8 million for
the year ending December 31, 2002, of which $4.5 million was related to our
restructuring and closing of our data center.

          The Company's continued existence is dependent on its ability to
achieve future profitable operations and its ability to obtain financial
support. The satisfaction of the Company's cash requirements hereafter will
depend in large part on its ability to successfully generate revenues from
operations and raise capital to fund operations. There can, however, be no
assurance that sufficient cash will be generated from operations or that
unanticipated events requiring the expenditure of funds within its existing
operations will not occur. Management is aggressively pursuing additional
sources of funds, the form of which will vary depending upon prevailing market
and other conditions and may include high-yield financing vehicles, short or
long-term borrowings or the issuance of equity securities. There can be no
assurances that management's efforts in these regards will be successful. Under
any of these scenarios, management believes that the Company's common stock
would likely be subject to substantial dilution to existing shareholders. The
uncertainty related to these matters and the Company's bankruptcy status raise
substantial doubt about its ability to continue as a going concern. The
financial statements do not include adjustments that might result from the
outcome of this uncertainty.


         .

Recent Accounting Pronouncements

          None currently noted that will have any significant impact on the
Company's current operations.

Quantitative and Qualitative Disclosures about Market Risk

          The Company does not have significant exposure to changing interest
rates. The Company does not undertake any specific actions to cover its exposure
to interest rate risk and the Company is not party to any interest rate risk
management transactions. The Company does not purchase or hold any derivative
financial instruments.

                                       11

<PAGE>


Factors Affecting Future Results

General effects of a bankruptcy filing

          The filing of our bankruptcy petition, and the publicity attendant
thereto, may adversely affect our business. Our competitive advantage may also
be hindered because of the taint and stigma associated with a bankruptcy
petition filing. We believe that such taint and stigma is especially true for
companies providing ebusiness infrastructure, including application delivery and
managed IT services, because of the fear from potential customers that the
company will go out of business and not be able to provide the valuable
services. Additionally, although we believe that we have good relationships with
our suppliers and vendors, there can be no assurance that such suppliers and
vendors will continue to provide such goods and services to us due to the
concerns regarding credit worthiness resulting from the chapter 11 proceeding.
Also it may be difficult for us to obtain financing (whether debt or equity) as
we may require to fund operations and/or growth. Due to delays in our financing,
we will need to negotiate payment terms with some of our administrative claim
holders. There can be no assurance that we will reach agreement with these
parties or be able to satisfy their indebtedness in a timely manner acceptable
to them.

We have been sustaining losses and our independent auditors have expressed doubt
about our ability to continue as a going concern.

          Our revenue to date has not been sufficient to offset the expenses
incurred in our business activities. We cannot assure you that we will ever
achieve profitability. In their report dated April 12, 2004, our independent
auditors stated that our financial statements for the year ended December 31,
2003 were prepared assuming that we would continue as a going concern. Our
ability to continue as a going concern is an issue raised as a result of
continued operating losses and is subject to our ability to generate profits
and/or obtain necessary funding from outside sources, included obtaining funding
from the sale of our securities or obtaining loans from various financial
sources. The going concern qualification increases the difficulty in meeting
such goals and there can be no assurances that such methods will prove
successful.

We will need to raise additional funds in the future to finance our operations.

          We have always relied heavily on external financing to fund
operations. We will need to raise additional funds to finance continuing
operations until cash flows from operations are sufficient. We may seek such
funding by offerings of our equity securities, offerings of debt securities or
obtaining financing through a bank or other entity. We have not established a
limit as to the amount of debt we may incur nor have we adopted a ratio of our
equity to a debt allowance. There is no assurance that financing will be
available from any source, that it will be available on terms acceptable to us,
or that any future offering of securities will be successful. If additional
funds are raised through the issuance of equity securities, there may be a
significant dilution in the value of our outstanding common stock. We could
suffer adverse consequences if we are unable to obtain additional capital when
needed.

We are uncertain as to sources of the additional financing we will need

          We may use our common stock to fully or partially finance future
acquisitions. In the event that our common stock does not maintain a sufficient
market value, or potential acquisition candidates are otherwise unwilling to
accept our common stock as part of the consideration for the sale of their
businesses, we may be required to utilize our cash resources, if available, in
order to pursue acquisitions. If we do not have sufficient cash resources, our
growth may be limited unless we are able to obtain additional capital through
debt or equity financings. We presently do not have any immediate source of
cash. We may be unable to obtain a working capital line of credit or other
financing we may need for acquisitions or to keep operating. If our financial
resources are inadequate, we may be unable to successfully implement our
business strategy.

We may be unable to manage our growth effectively

          To manage our anticipated growth, we must be able to implement and
improve our operational and financial systems and train and manage an expanding
employee base. Further, we must be able to manage multiple relationships among
various financial institutions, investors, suppliers, strategic partners,
technology distributors and other third parties. Our systems, procedures, and
controls are not currently sufficient to support current or future operations.
Our management team may be unable to deal with this expansion to achieve the
rapid execution necessary to fully exploit the opportunities we see in our
targeted market. We also cannot assure you that we will be able to successfully
compete with the more extensive and well-funded operations of our competitors.
We may be unable to manage growth, integrate operations effectively or achieve
the rapid expansion necessary to fully exploit the market window for our
services in a timely and cost-effective manner.

                                       12

<PAGE>


Our quarterly operating results could vary dramatically

          Our revenues, gross profit, operating income and net income are likely
to vary in the future from quarter to quarter, perhaps substantially. Factors
that may affect this quarter-to-quarter variability include:

     o    disruption or degradation of our network infrastructure and data
          centers,
     o    loss of significant strategic alliances, such as with InterNAP and
          Intel,
     o    the short-term nature of certain client commitments,
     o    fluctuations in Internet and IT spending and bandwidth used by
          customers,
     o    loss of a major client,
     o    seasonality that may accompany budget cycles,
     o    the timing, size and mix of service and product offerings,
     o    the timing and size of significant software sales,
     o    the timing and size of new projects,
     o    the timing and magnitude of required capital expenditures , o pricing
          changes and increases in capital expenditures in response to various
          competitive factors,
     o    market factors affecting the availability of network interconnectivity
          and bandwidth for our customers and qualified technical personnel,
     o    timing and client acceptance of new service offerings,
     o    changes in the trends affecting the outsourcing of Internet-based IT
          services,
     o    additional selling, general and administrative expenses to acquire and
          support new business,
     o    increased levels of technological change in the industry, and
     o    general economic conditions.

          Our operating results will be affected by changes in our network
charges, Colocation charges and equipment costs.

Network and data center failures could lead to significant costs

          We must protect our network and data center infrastructure and
equipment against damage from human error, physical or electronic security
breaches, power loss and other facility failures, fire, earthquake, flood,
telecommunications failure, sabotage, vandalism and similar events. Despite
precautions, a natural disaster, security breach or other unanticipated problems
at one or more of our telecommunication switches, POP connections or data
centers could result in interruptions in our services or significant damage to
our equipment. In addition, failure of any of our telecommunication or data
providers to provide consistent communications and data capacity could result in
interruptions in our services. Any damage to or failure of our systems or
service providers could result in reductions in, or terminations of, services
supplied to our customers, which could have a material adverse effect on our
business. We may experience interruptions in specific circuits within our
network resulting from events outside our control, which could lead to
short-term degradation in the level of performance of our network.

Client satisfaction with our services is critical to our success

          Our customers demand a very high level of service. Our customers
generally require service on a 24 hours per day, seven days per week basis. If
we incur significant service level commitment obligations in connection with
system downtime, our liability insurance may not be adequate to cover these
expenses. If we do not meet required service levels, we may have to provide
credits to our customers, which could significantly reduce our revenues. As
customers outsource more mission-critical operations to us, we are subject to
increased liability claims and client dissatisfaction if our systems fail or our
customers otherwise become unsatisfied. In the event of any resulting harm to
customers, we could be held liable for damages. Awards for such damages might
exceed our liability insurance by an unknown but significant amount and could
seriously harm our business.

Protection of our intellectual property and proprietary rights

          Our ability to develop new technology and technology solutions will
depend on the continued innovation, technical expertise and know-how of our
employees and consultants. We intend to establish a policy of requiring our

                                       13

<PAGE>


employees and consultants to execute confidentiality agreements, however, there
can be no assurance that this procedure will be adequate to prevent
misappropriation of our technology nor can we be assured that our competitors
will not independently develop technologies that are substantially equivalent or
superior to those of ours.

Our ability to implement and expand our network is unproven and will require
substantial financial, operational and managerial resources

          To satisfy client requirements, we must implement, expand and adapt
our infrastructure. We are dependent on service providers for our network
capacity. The expansion and adaptation of our infrastructure will require
substantial financial, operational and management resources. Our ability to
connect and manage a substantially larger number of customers is unknown. We
have yet to prove our infrastructure's ability to be scaled up to higher client
levels while maintaining superior performance. Furthermore, it may be difficult
for us to increase quickly our network capacity in light of current necessary
lead times within the industry to purchase circuits and other critical items. If
we fail to achieve or maintain high capacity data transmission circuits, client
demand could diminish because of possible degradation of service. In addition,
as we upgrade our infrastructure to increase bandwidth available to our
customers, we expect to encounter equipment or software incompatibility which
may cause delays in implementation.

We depend on network interconnections provided by third parties that may raise
their fees or deny access

          We rely on a number of public and private network interconnections to
allow our customers to connect to other networks. If the networks with which we
interconnect were to discontinue their interconnections, our ability to exchange
traffic would be significantly constrained. Furthermore, our business will be
harmed if these networks do not add more bandwidth to accommodate increased
traffic. Many of the companies with which we maintain interconnections are our
competitors. There is nothing to prevent any networks, many of which are
significantly larger than we are, from charging high usage fees or denying
access. In the future, networks could refuse to continue to interconnect
directly with us, might impose significant costs on us or limit our customers'
access to their networks. In this event, we may not be able to access
alternative networks to exchange our customers' traffic on a cost-effective
basis. In addition, we may not be able to pass through to our customers any
additional costs of utilizing these networks. In these cases, our business could
be harmed.

If we are unable to continue to receive cost-effective service from our
providers, we may not be able to provide our services on profitable terms

          In delivering our services, we rely on network and services, which are
built and operated by others. In order to be able to provide optimal routing to
our customers through our infrastructure facilities, we must purchase
connections from several providers. We cannot assure you that these providers
will continue to provide service to us on a cost-effective basis, if at all, or
that these providers will provide us with additional capacity to adequately meet
client demand.

Our brand is relatively new, and failure to develop brand recognition could hurt
our ability to compete effectively

          To successfully execute our strategy, we must create and strengthen
our brand awareness. If we do not build our brand awareness, our ability to
realize our strategic and financial objectives could be hurt. Many of our
competitors have well-established brands associated with the provision of
Internet network services. In order to build our brand awareness, we intend to
significantly increase our marketing efforts, which may not be successful, and
we must continue to provide high quality services. As part of our brand building
efforts, we expect to increase our marketing budget substantially as well as our
marketing activities, including advertising, tradeshows, direct response
programs and new switch and POP site launch events.

The work we perform for customers may expose us to liability

          The nature of the services and products we offer expose us to risks.
Many of our engagements involve projects that are critical to the operations of
our customers' businesses. Our failure or inability to meet a client's needs or
to do so in the time frame required by such customers could result in a claim
for substantial damages against us, regardless of our responsibility for such

                                       14

<PAGE>


failure. Although we intend to obtain general liability and errors and omissions
insurance coverage, there can be no assurance that such coverage will be
available on reasonable terms or in sufficient amounts to cover one or more
large claims, or that the insurer will not disclaim coverage as to any future
claim. The successful assertion of one or more large claims against us that
exceed available insurance coverage or results in changes to our insurance
policies, including premium increases or the imposition of large deductible or
co-insurance requirements, could have a material adverse effect on our business.

We depend on our suppliers

          Although we have not experienced significant problems with our
suppliers of services, hardware, software and componentry, there can be no
assurance that such relationships will continue or that, in the event of a
termination of our relationships with any given supplier, we would be able to
obtain alternative sources of supply without a material disruption in our
ability to provide products and services to our customers.

We are uncertain as to sources of the additional financing we will need

          We may use our common stock to fully or partially finance future
acquisitions. In the event that our common stock does not maintain a sufficient
market value, or potential acquisition candidates are otherwise unwilling to
accept our common stock as part of the consideration for the sale of their
businesses, we may be required to utilize our cash resources, if available, in
order to pursue acquisitions. If we do not have sufficient cash resources, our
growth may be limited unless we are able to obtain additional capital through
debt or equity financings. We presently do not have any immediate source of
cash. We may be unable to obtain a working capital line of credit or other
financing we may need for acquisitions or to keep operating. If our financial
resources are inadequate, we may be unable to successfully implement our
business strategy.

We are dependent on our management team

          We are dependent on the continued efforts of our executive officers,
in particular John C. Paulsen, our President and Chief Executive Officer. We do
not maintain key person life insurance on any of our executive officers. If any
of these people become unable to continue in his or her role with us, or if we
are unable to attract and retain other qualified employees, our financial
performance and business prospects will probably be negatively impacted.

We could be subject to claims of infringement by third parties

          We rely upon a combination of nondisclosure and other contractual
arrangements and trade secret, copyright and trademark laws to protect our
proprietary rights and the proprietary rights of third parties from whom we
license intellectual property. We enter into confidentiality agreements with our
employees and limit distribution of proprietary information. There can be no
assurance that these steps will be adequate to deter misappropriation of
proprietary information or that we will be able to detect unauthorized use and
take appropriate steps to enforce our intellectual property rights.

          We believe that our services do not infringe on the intellectual
property rights of others and that we have all rights necessary to utilize the
intellectual property employed in our business. However, we are subject to the
risk of claims alleging infringement of third-party intellectual property
rights. Any such claims could require us to spend significant sums in
litigation, pay damages, develop non-infringing intellectual property or acquire
licenses to the intellectual property that is the subject of asserted
infringement.

We operate in a relatively new and evolving market with uncertain prospects for
growth

          The market for Internet networks and related services has only
recently begun to develop and is evolving rapidly. Although certain industry
analysts project significant growth for this market, their projections may not
be realized. Our future growth, if any, will depend on the continued trend of
businesses migrating toward use of the Internet and our ability to market our
services effectively. There can be no assurance that the market for our services
will grow, that our services will be adopted, or that businesses will use these
Internet-based services to the degree or in the manner that we expect. If we are
unable to react quickly to changes in the market, if the market fails to
develop, or develops more slowly than expected, or if our services do not
achieve market acceptance, then we are unlikely to become or remain profitable.

                                       15

<PAGE>


We face strong competition

         The market for the products and services we offer is highly
competitive. Our competitors vary in size and in the scope of the products and
new services that they offer. Primary competitors generally include:

     o    complete solution providers,
     o    ISPs (Internet service providers),
     o    web hosting firms,
     o    application hosting firms,
     o    strategic consulting firms,
     o    in-house IT departments of customers, and
     o    computer hardware and service vendors.

          Traditionally, the largest service providers have principally focused
on providing solutions to international Fortune 500 companies. A large number of
smaller service companies and a growing number of larger companies compete in
the middle market segment.

          There are relatively low barriers to entry into our target market. We
expect to face competition from established and new companies. Increased
competition may result in greater pricing pressure, which could adversely affect
our gross margins. In addition, many of our competitors have greater financial,
development, technical, marketing and sales resources than we do. As a result,
our competitors may be able to adapt more quickly to new or emerging
technologies and to changes in client requirements or to devote greater
resources than us for the development, promotion, sale and support of
Internet-based products and services. In addition, there is a risk that
customers may elect to increase their internal IT resources to satisfy their IT
solutions needs. We may also enter new markets and offer new services, and
expect to face intense competition from existing and new competitors,
particularly since barriers of entry in the IT service industry are relatively
low. We cannot assure you that we will continue to provide IT services and
products demanded by our target market or be able to compete successfully with
existing or new competitors. An inability to compete in our market effectively
would negatively impact our financial performance and business prospects.

                                       16

<PAGE>


We are dependent on hiring and retaining skilled personnel

          We must attract, hire and retain personnel who possess the skills and
experience necessary to operate our business and serve our customers.
Competition for individuals with proven skills is intense. In addition, the
Internet-based IT service industry in general experiences a high rate of
turnover. We compete for such individuals with Internet companies, systems
integrators, providers of outsourcing services, temporary personnel agencies,
computer systems consultants, customers and potential customers. Many large
competitors have extensive campaigns to hire additional technical personnel or
have full time recruiters on staff. Competition for quality technical personnel
has continued to intensify, resulting in increased personnel costs for many IT
service providers. There can be no assurance we will be able to recruit or
retain the technical personnel necessary to execute our strategy. Failure to do
so would have a material adverse effect on our financial performance and
business.

Our industry is changing rapidly and new solutions are constantly being
introduced

          The Internet-based IT service and e-commerce industries are
characterized by rapid technological change, evolving industry standards,
changing client preferences and new product and service introductions. Our
success will depend in part on our ability to develop Internet-based IT
solutions that keep pace with continuing changes in the IT service and
e-commerce industries. There can be no assurance that we will be successful in
adequately addressing these developments on a timely basis or that, if these
developments are addressed, we will be successful in the marketplace. In
addition, there can be no assurance that products or technologies developed by
others will not render our services non-competitive or obsolete. Our failure to
address these developments could have a negative impact on our financial
performance and business prospects.

Potential customers may not widely adopt Internet solutions, and, if they do,
may not outsource such projects

          The market for our products and services will depend upon the adoption
of Internet, intranet, extranet and web site solutions by customers. If
customers and potential customers choose not to implement such solutions, we
will address a smaller market and our revenues could be adversely affected. Some
critical unresolved issues concerning the use of Internet solutions are
security, reliability, cost, ease of deployment and administration and bandwidth
of the Internet itself. These issues may affect the use of such technologies to
solve business problems. Some entities would have to change significantly the
way they do business to adapt to the Internet. Even if these issues are
resolved, businesses might not elect to outsource the design, development and
maintenance of their Internet, intranet, extranet and web site solutions to
firms such as eNucleus.

ITEM 7            FINANCIAL STATEMENTS AND SUPPLEMENTAL DATA

          The following financial statements for eNucleus and independent
auditors' report as of December 31, 2003 and 2002 and for the years then ended
are filed as part of this report on Form 10-KSB beginning on page F-1.

          Report of Independent Public Accountants
          Balance Sheets as of December 31, 2003 and 2002
          Statements of Operations for the years ended December 31, 2003 and
           2002
          Statements of Stockholders' Equity (Deficit) for the years ended
          December 31, 2003 and 2002
          Statements of Cash Flows for the years ended December 31, 2003 and
          2002 Notes to the Financial Statements

ITEM 8            CHANGE IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
                  FINANCIAL DISCLOSURE

          NONE

ITEM 8A     CONTROLS AND PROCEDURES

          Within the 90 days prior to the date of this report, eNucleus
management (including our Chief Executive and Financial Officer, John Paulsen)
conducted an evaluation of the effectiveness of the design and operation of the
Company's disclosure controls and procedures as defined in the Exchange Act Rule
13a-14. Based on that evaluation, Mr. Paulsen concluded that the Company's

                                       17

<PAGE>

disclosure controls and procedures were effective as of the date of the
evaluation. There have been no significant changes in internal controls, or in
factors that could significantly affect internal controls, subsequent to the
date of the most recent evaluation.

PART III

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

Directors and Executive Officers

          The following table contains certain information with respect to our
directors and executive officers:

Name                Age     Position as of the year ended 12/31/03
----                ---     --------------------------------------

John C. Paulsen     41      Chairman of the Board/Director, Chief Executive
                            Officer, Chief Financial Officer and Secretary

Scott Voss          45      President (1)
(1)      President until October, 2003

          John C. Paulsen has served as Chairman of the Board and Chief
Executive Officer of eNucleus since April 1999. Prior thereto, Mr. Paulsen
served as the President of Nucleus Holding Company. From 1995 to 1997 Mr.
Paulsen served as President and CEO of MetroLink Communications, Inc. a
long-distance carrier. From 1990 to 1995, Mr. Paulsen served as President and
CEO of American Teletronics Long Distance, Inc. a reseller of long-distance
telecommunications services.

          Scott Voss joined eNucleus following the bankruptcy petition. Prior
thereto, Mr. Voss served as an advisor to the company on various financing,
sales and marketing projects. Mr. Voss has extensive experience in developing
and growing marketing orientated organizations. Before joining eNucleus, Mr.
Voss was President of Sterling Press and Graphics which specialized in
collateral development and printing for high growth businesses.

          Board of Directors

          Currently, John Paulsen is the Company's sole director. As soon as
practicably, Mr. Paulsen, intends to fill the vacancies on the Board of
Directors resulting from the previous resignations of the Company's other
directors. Included in the Directors so appointed will be two representatives
from the creditor committee pursuant to the Company's Plan of Reorganization.

          Our last Annual Shareholder Meeting was held on July 14, 2000.
Subsequent to the shareholder meeting, and as a result or restructuring and
filing of the Chapter 11 petition, each of the directors previously elected to
serve (except Mr. John C. Paulsen) resigned from the Board of Directors. No new
directors have been elected.

          Section 16(A) Beneficial Ownership Reporting Compliance. Section 16(a)
of the Securities Exchange Act of 1934 requires our directors, executive
officers, and persons who own more than 10% of our equity securities, to file
initial reports of ownership and reports of changes in ownership of our common
stock and other equity securities with the Securities and Exchange Commission.
Executive officers, directors and 10% owners are required by SEC regulation to
furnish us with copies of all Section 16(a) forms they file. During the year, no
reporting was provided to eNucleus in accordance with this section.

ITEM 10           EXECUTIVE COMPENSATION

          The following table summarizes the compensation paid for the years
ended December 31, 2003, 2002 and 2001 to the individuals who served as our
chief executive officer during such periods and those serving as current
executive officers.

                                       18

<PAGE>
<TABLE>
<CAPTION>


Summary Compensation Table

                                                                                       All Other
Name and Principal Position                    Year      Salary ($)      Bonus ($)     Compensation ($)
---------------------------                    ----      ----------      ---------     ----------------
<S>                                            <C>           <C>              <C>                  <C>
John C. Paulsen, Chief Executive Officer,      2003          34,000           --                   --
President, principal Financial Officer and     2002          98,000           --                   --
Secretary (1)                                  2001         143,000           --                   --

Scott Voss, President (2)                      2003               0           --                   --
                                               2002          36,000           --                   --
                                               2001           6,000
(1) President until May, 2001.
(2) President May, 2001 until October, 2003

          The following table summarizes the individual grants of stock options
made during the most recent fiscal year to the individuals who served as our
named executive officers.


Summary Option Grants in Last Fiscal Year Table

          None

Aggregate Option Exercises in Last Fiscal Year and Fiscal Year End Option Values

          None

Compensation of Directors

          Currently, John Paulsen is the Company's sole director. As soon as
practicably, Mr. Paulsen, intends to fill the vacancies on the Board of
Directors resulting from the previous resignations of the Company's other
directors. Mr. Paulsen was not compensated for serving as the Company's director
during the last fiscal year. Upon the reconstitution of the Board of Directors,
the Company anticipates compensatory arrangements to be made to those serving
and participating in the growth and development of the Company, including stock
based arrangements.

Employment Contracts

          The Company is currently in the process of appointing and entering
into employment agreements with its executive officers.

ITEM 11           SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS

          Subsequent to year-end, the Board of Directors authorized and
shareholders approved a one for ten reverse stock split of all issued and
outstanding common stock, effective February 18, 2004. The par value of the
common stock was maintained at the pre-split amount of $.001 per share and the
authorized capital was maintained at 100,000,000 shares of common stock, and the
par value of the preferred stock was maintained at the pre-split amount of
$0.001 per share, and the authorized capital was maintained at 20,000,000 shares
of preferred stock. All references to common shares and per share amounts have
been restated to reflect this reverse stock split on a retroactive basis,
exclusive of fractional shares.

Security Ownership of Certain Beneficial Officers

          The following table sets forth the number of shares of common stock
beneficially owned as of April 8, 2004, by each person known by us to
beneficially own more than 5% of the common stock of eNucleus. A beneficial
owner of a security includes any person who has the power to vote or sell the
shares.

                                       19
</TABLE>

<PAGE>


          Name of Beneficial Owner (1)       Amount and Nature       Percent of
          ----------------------------         of Beneficial          Class (3)
                                               Ownership (3)          ---------
                                               -------------
          Congruent Ventures, LLC                 4,697,763             29.0%
          Monte Carlo Funding                     2,450,000             15.1%
          Aspatuck Holdings                       2,000,000             12.3%
          Eric Stari (2)                            877,000              5.4%


          (1)  The mailing address is c/o eNucleus 4000 Main Street, Bay Harbor,
               MI 49770

          (2)  Includes shares held directly by Mr. Stari and indirectly through
               a family trust for which Mr. Stari acts as majority general
               partner

          (3)  Includes certain shares held as well as the "as converted" shares
               to be received under the Series A Convertible Preferred Stock.

Security Ownership of Directors and Executive Officers

          The following table sets forth the number of shares of common stock
beneficially owned as of April 8, 2004 by (i) each of our directors, (ii) our
executive officers and (iii) all directors and executive officers as a group. A
beneficial owner of a security includes any person who has the power to vote or
sell the shares.

          Name of Beneficial Owner                Amount and Nature   Percent of
          ------------------------                   of Beneficial      Class
                                                       Ownership        -----
                                                       ---------
          John C. Paulsen (1)                           504,000  (2)     3.0%
          All directors and executive officers,
          as a group (1 persons)                        504,000          3.0%


          (1)  The mailing address is c/o eNucleus 4000 Main Street, Bay Harbor,
               MI 49770.

          (2)  Includes shares held directly by Mr. Paulsen and indirectly
               through a family trust for which Mr. Paulsen acts as majority
               general partner


ITEM 12       CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

          As part of the Plan of Reorganization, the Company entered into a
borrowing facility with Sunami Ventures, LLC ("Sunami") (a limited liability
company managed and controlled by Mr. Henry Paulsen, John Paulsen's father). In
accordance with the Plan of Reorganization, Sunami (or others who shall provided
post-petition financing) shall receive on account of the borrowings, five shares
of New Common Stock for every ten dollars loaned and a Senior Secured Note for
the amount of the borrowings. As of December 31, 2003, eNucleus has received
approximately $1 million of value under this facility the proceeds of which have
been used to satisfy certain petitions resulting from the bankruptcy and
post-petition operating requirements and which approximately 500,000 shares were
issued in conjunction with the facility. During 2002, Sunami agreed to convert
approximately $700,000 of Senior Secured Note into equity and the remaining was
converted into equity during 2003. Shares of common stock received from these
conversions totaled approximately 1.5 million.

          In December, 2002 the Company decided to close our data center
facility in Atlanta and requested to terminate its collocation/lease agreement
with Sunami. As a result of this decision, the Company issued approximately
450,000 of restricted common stock as consideration for the release of $913,000
of remaining lease obligations as well as the relinquishment of our security
deposit and the rights and title to certain leasehold improvements made to the
facility.

          During 2002 the Company issued 70,000 and 75,000 shares of common
stock to Mr. Paulsen and Mr. Voss, respectively in lieu of certain monies owed
under their compensation arrangements. In March, 2002, the Company granted

                                       20

<PAGE>


options to purchase up to 250,000 shares of restricted common stock to Mr.
Paulsen and Mr. Voss, respectively, at a price equal to the market price on date
of grant. Such options were granted for the consideration and incentive to
continue employment and at a substantially reduced salary through the remainder
of 2002 and until such time the Company provides positive cash flow operating
earnings. As of December 31, 2002, these options were fully exercised and the
respective shares had been issued.

          Subsequent to year end and subject to certain contingencies, Congruent
Ventures has agreed to transfer up to 394,777 of their eNucleus preferred stock
holdings and 206,000 warrants to John Paulsen in consideration of among other
things Mr. Paulsen agreeing to serve as Chairman & CEO for a period of no less
than 12 months.

          Subsequent to year end and beginning May 1, 2004, Congruent Ventures'
CEO, Dhru Desai, agreed to join eNucleus' management team as President and serve
as a member of the Company's Board of Directors.



ITEM 13       EXHIBITS AND REPORTS ON FORM 8-K

(a)  Exhibit Index

     See Exhibit Index beginning on page A-1.

(b)  Reports on Form 8-K

          On February 19, 2004, we filed a Current Report on Form 8-K relating
to the entering into an Asset Purchase Agreement to purchase substantially all
the assets of PrimeWire, Inc.

ITEM 14     PRINCIPAL ACCOUNTANT FEES AND SERVICES

          The Company was billed for audit services rendered by the our
independent auditors $30,000 and $25,000 during 2003 and 2002, respectively. No
Audit-Related fees or Tax fees were incurred by the Company. The Board of
Directors reviewed and discussed the Company's audited financial statements for
the fiscal year ended December 31, 2003, with management and the independent
auditors


         SIGNATURE


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


Date:  April 14, 2004                       By:  /s/  John C. Paulsen
                                               --------------------------------
                                                      John C. Paulsen
                                                      Chief Executive Officer
                                                      and principal Financial
                                                      Officer





          Pursuant to the requirements of the Exchange Act, this report has been
signed below by the following persons on behalf of the Registrant and in the
capacities and on the dates indicated.

Signature                    Title                                Date
---------                    -----                                ----

/s/  John C. Paulsen         Chief Executive Officer, Chairman    April 14, 2004
------------------------     of the Board and principal
     John C. Paulsen         Financial and Accounting Officer

                                       21

<PAGE>


EXHIBIT INDEX


Exhibit No.        Description
-----------        -----------

     21             Subsidiaries of eNucleus, Inc.

     23.1           Consent of Bujan & Associates, Ltd.

     31.1           Certification of Chief Executive Officer pursuant to Section
                    302 of the Sarbanes-Oxley Act of 2002.

     32.1           Certification of Chief Executive Officer pursuant to Section
                    906 of the Sarbanes-Oxley Act of 2002.

                                       22

<PAGE>


INDEX TO FINANCIAL STATEMENTS


Report of Bujan & Associates, Ltd, Independent Public Accountants            F-1

Consolidated Balance Sheets as of December 31, 2003 and 2002                 F-2

Consolidated Statements of Operations for the Years
     Ended December 31, 2003 and 2002                                        F-3

Consolidated Statements of Changes in Shareholders' Equity
     (Deficit) for the Years Ended December 31, 2003 and 2002                F-4

Consolidated Statements of Cash Flows for the Years
     Ended December 31, 2003 and 2002                                        F-5

Notes to Consolidated Financial Statements                                   F-6

                                      iii


<PAGE>


Report of Independent Public Accountants

To the Board of Directors and Stockholders of eNucleus, Inc.:

     We have audited the accompanying consolidated balance sheets of eNucleus,
Inc. (a Delaware corporation) (the Company) as of December 31, 2003 and 2002,
and the related statements of operations, stockholders' (deficit) equity, and
cash flows for the years ended December 31, 2003 and 2002. 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. Those standards require that we plan and perform
the audit 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 consolidated financial statements referred to above
present fairly, in all material respects, the financial position of eNucleus,
Inc. as of December 31, 2003 and 2002 and the results of their operations and
cash flows for the years ended December 31, 2003 and 2002, in conformity with
accounting principles generally accepted in the United States.

     The accompanying consolidated financial statements have been prepared
assuming that the Company will continue as a going concern. As more fully
discussed in Note 2 to the financial statements, the Company continues to incur
operating losses and must continue to fund negative working capital needs. There
can be no assurance that the Company will reach agreement with these parties or
be able to satisfy their indebtedness in a timely manner acceptable to them
These conditions raise substantial doubt about the Company's ability to continue
as a going concern. The financial statements do not include any adjustments that
might result from the outcome of this uncertainty.







/s/  Bujan & Associates, Ltd
-----------------------------
     Bujan & Associates, Ltd


Palos Heights, Illinois
April 12, 2004

                                      F-1

<PAGE>
<TABLE>
<CAPTION>



                                 eNucleus, Inc.
                           Consolidated Balance Sheets
                               As of December 31,

                                                            2003           2002
                                                            ----           ----
ASSETS:
<S>                                                     <C>            <C>
  Current assets:
Cash                                                    $        78    $     4,932
Accounts receivable                                          16,900         54,893
Other current assets                                         41,038         37,974
                                                        -----------    -----------
Total current assets                                         58,016         97,799
                                                        -----------    -----------

Property and equipment, net                                  19,786        491,430
Goodwill and other intangibles, net                       1,674,622      1,771,274
Other assets                                                   --             --
                                                        -----------    -----------
Total assets                                            $ 1,752,424    $ 2,360,503
                                                        -----------    -----------


  LIABILITIES & STOCKHOLDERS' EQUITY:
  Current liabilities:
Notes payable                                           $   156,861    $   425,540
Accounts payable                                             42,792        272,798
Accrued expenses                                            267,613        452,161
                                                        -----------    -----------
Total current liabilities                                   467,266      1,150,499
                                                        -----------    -----------

  Long term liabilities                                     345,246        867,689
                                                        -----------    -----------

  Total liabilities                                         812,512      2,018,188
                                                        -----------    -----------

                                                        -----------    -----------
Contingencies                                                  --             --
                                                        -----------    -----------


  STOCKHOLDERS' EQUITY:
Preferred stock, $0.001 par value, 20,000,000 shares
authorized, 1,453,779 shares issued and outstanding           1,454           --
Common stock, $0.001 par value, 100,000,000 shares            9,528          3,326
authorized, 9,527,938 and 3,326,287 shares issued and
outstanding, respectively
Additional paid-in capital                                8,350,242      6,299,011
Accumulated deficit                                      (7,421,312)    (5,960,022)
                                                        -----------    -----------

Total stockholders' equity                                  939,912        342,315
                                                        -----------    -----------

Total liabilities and stockholders' equity              $ 1,752,424    $ 2,360,503
                                                        -----------    -----------


           See accompanying notes to Consolidated Financial Statements.

                                      F-2
</TABLE>

<PAGE>


                                 eNucleus, Inc.
                      Consolidated Statements of Operations
                        For the Year Ending, December 31,



                                                         2003           2002
                                                         ----           ----

 Revenue                                             $   577,574    $   285,687

 Operating expenses                                      980,412      1,153,272
 Stock based compensation expense                           --             --
 Net reorganization expense                              897,182      4,517,579
 Depreciation and amortization expense                   150,965        375,621
                                                     -----------    -----------
 Operating loss                                       (1,450,985)    (5,760,785)


 Interest and other income (expense)                     (10,305)         3,157

 Income tax expense                                            0           --
                                                     -----------    -----------

 Net loss                                            $(1,461,290)   $(5,757,628)
                                                     ===========    ===========



Basic and diluted net loss per common share          $     (0.28)   $     (2.50)
                                                     ===========    ===========

Weighted average shares outstanding - basic and        5,250,310      2,300,625
diluted                                              ===========    ===========


          See accompanying notes to Consolidated Financial Statements.

                                      F-3

<PAGE>
<TABLE>
<CAPTION>


                                     eNucleus, Inc.
               Consolidated Statements of Changes in Stockholders' Equity



                                     Preferred Stock                 Common Stock
                                  Shares         Amount         Shares         Amount
                               -----------    -----------    -----------    -----------
<S>                             <C>           <C>            <C>            <C>
Balance, December 31, 2001            --             --             --             --
                               -----------    -----------    -----------    -----------
Issuance of common stock
through the exchange of Old
Common Stock (per Plan)               --             --          174,993            175

Issuance of common stock
through the exchange of
creditor claims (per Plan)            --             --          276,411            276

Contributed capital from the
unexchanged stock and debt            --             --             --             --

Issuance of common stock in
conjunction with debt
financings                            --             --          554,240            554

Common stock issued upon
conversion of debt                    --             --        1,204,643          1,205

Common stock issued for
employment services                   --             --          240,000            240

Common stock issued upon
exercise of options                   --             --          700,000            700

Common stock issued for
services provided                     --             --          171,000            171

Issuance of common stock for
acquisitions                          --             --            5,000              5

Net loss
                                      --             --             --             --
                               -----------    -----------    -----------    -----------
Balance, December 31, 2002
                                      --             --        3,326,287          3,326
                               -----------    -----------    -----------    -----------
Issuance of common stock in
conjunction with debt
financings                            --             --          168,751            169

Common stock issued for
employment services                   --             --          342,500            343

Common stock issued for
services provided                     --             --          295,000            295

Common stock issued upon
conversion of debt                    --             --        5,395,400          5,395

Preferred stock issued upon
conversion of debt               1,453,779          1,454           --             --

Net loss
                                      --             --             --             --
                               -----------    -----------    -----------    -----------
Balance, December 31, 2003       1,453,779    $     1,454      9,527,938    $     9,528
                               -----------    -----------    -----------    -----------

                                          F-4
</TABLE>

<PAGE>
<TABLE>
<CAPTION>


                                   eNucleus, Inc.
               Consolidated Statements of Changes in Stockholders' Equity
                                      (Continued)


                                   New        Additional
                                  Equity        Paid in      Accumulated
                                 Issuable       Capital        Deficit         Total
                               -----------    -----------    -----------    -----------
<S>                            <C>            <C>            <C>            <C>
Balance, December 31, 2001     $ 3,671,934           --      $  (202,394)   $ 3,469,540
                               -----------    -----------    -----------    -----------
Issuance of common stock
through the exchange of Old
Common Stock (per Plan)         (  874,963)       874,788           --            --

Issuance of common stock
through the exchange of
creditor claims (per Plan)      (1,382,057)     1,381,781           --             --

Contributed capital from the
unexchanged stock and debt      (1,414,914)     1,414,914           --             --

Issuance of common stock in
conjunction with debt
financings                            --            4,988           --            5,542

Common stock issued upon
conversion of debt                    --        2,567,356           --        2,568,561

Common stock issued for
employment services                   --            2,160           --            2,400

Common stock issued upon
exercise of options                   --           31,300           --           32,000

Common stock issued for
services provided                     --           14,229           --           14,400

Issuance of common stock for
acquisitions                          --            7,495           --            7,500

Net loss
                                      --             --       (5,757,628)   (5,757,628)
                               -----------    -----------    -----------    -----------
Balance, December 31, 2002
                                         0      6,299,011     (5,960,022)      342,315
                               -----------    -----------    -----------    -----------
Issuance of common stock in
conjunction with debt
financings                            --           72,831           --           73,000

Common stock issued for
employment services                   --           73,607           --           73,950

Common stock issued for
services provided                     --          152,455           --          152,750

Common stock issued upon
conversion of debt                    --          433,977           --          439,372

Preferred stock issued upon
conversion of debt                    --        1,318,361           --        1,319,815

Net loss
                                      --             --       (1,461,290)   (1,461,290)
                               -----------    -----------    -----------    -----------
Balance, December 31, 2003     $      --        8,350,242     (7,421,312)   $   939,912
                               -----------    -----------    -----------    -----------


              See accompanying notes to Consolidated Financial Statements.

                                       F-4(Con't)
</TABLE>

<PAGE>


                                 eNucleus, Inc.
                      Consolidated Statements of Cash Flows
                        For the Year Ending, December 31,


                                                        2003             2002
Cash flows from operating activities:
Net loss                                             $(1,461,290)   $(5,757,628)
Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:
  Non-cash reorganization expense                        897,182      4,517,579
  Depreciation and amortization                          150,965        375,624
Changes in operating assets and liabilities
  Changes in accounts receivables                         37,993         14,154
  Changes in other assets                                 93,587       (113,374)
  Changes in payables and accrued expenses                19,947        368,041
                                                     -----------    -----------
Net cash in operating operations                        (261,616)      (595,604)
                                                     -----------    -----------

Cash flows from investing activities:
Capital expenditures                                      (8,883)          --
                                                     -----------    -----------
Net cash used in investing activities                     (8,883)          --
                                                     -----------    -----------

Cash flows from financing activities:
Borrowings (repayments) on notes payable, net            275,353        567,728
Proceeds from sale of common stock                          --           32,000
                                                     -----------    -----------
Net cash provided by financing activities                275,353        599,728
                                                     -----------    -----------

Increase in cash                                           4,854          4,124
Cash, beginning of period                                  4,932            808
                                                     -----------    -----------
Cash, end of period                                  $        78    $     4,932
                                                     ===========    ===========


Non-cash investing and financing activities:
Obligations converted to stock                         1,760,000      1,205,000
                                                     -----------    -----------
Common stock issued for services                         153,000         17,000
                                                     -----------    -----------
Stock issued to effect acquisitions                         --            8,000
                                                     ===========    ===========


          See accompanying notes to Consolidated Financial Statements.

                                      F-5

<PAGE>


                                 eNucleus, Inc.
                   Notes to Consolidated Financial Statements
                           December 31, 2003 and 2002


(1) Description of the Business

     eNucleus, Inc. ("eNucleus" or the "Company") is a next generation software
and managed hosting company. eNucleus' business strategy is to acquire companies
that have proprietary software applications that fulfill core and niche business
processes (i.e., Enterprise Resource Management ("ERP"), Customer Resource
Management ("CRM"), Integrated IP Communications, Sales Automation, Tracking) in
specific market verticals (i.e. Healthcare, Education, Distribution Services and
Financial Services). We are particularly focused on products that enjoy strong
customer loyalty and can be enabled for delivery over the Internet for a
recurring monthly fee on either a managed hosting or pure ASP basis.


(2) Financial Results and Liquidity

     On November 6, 2003, eNucleus received its final decree from the United
States Bankruptcy Court for the Northern District of Illinois, successfully
concluding the Company's restructuring and emergence from bankruptcy. Although
the Plan resulted in a substantial reduction in debt, further improvements in
our liquidity position will be subject to the success of initiatives we are
undertaking to increase sales and reduce operating expenses.

     As shown in our results of operations, we continue to incur losses from
operations. During 2003, we incurred a net loss of $1.5 million, of which
approximately $1.05 million, relates to non-cash charges for stock based
compensation and expenses, bankruptcy related expenses and depreciation and
amortization charges. During 2002, we incurred a net loss of $5.8 million for
the year ending December 31, 2002, of which $4.5 million was related to our
restructuring and closing of our data center.

     The Company's continued existence is dependent on its ability to achieve
future profitable operations and its ability to obtain financial support. The
satisfaction of the Company's cash requirements hereafter will depend in large
part on its ability to successfully generate revenues from operations and raise
capital to fund operations. There can, however, be no assurance that sufficient
cash will be generated from operations or that unanticipated events requiring
the expenditure of funds within its existing operations will not occur.
Management is aggressively pursuing additional sources of funds, the form of
which will vary depending upon prevailing market and other conditions and may
include high-yield financing vehicles, short or long-term borrowings or the
issuance of equity securities. There can be no assurances that management's
efforts in these regards will be successful. Under any of these scenarios,
management believes that the Company's common stock would likely be subject to
substantial dilution to existing shareholders. The uncertainty related to these
matters and the Company's bankruptcy status raise substantial doubt about its
ability to continue as a going concern. The financial statements do not include
adjustments that might result from the outcome of this uncertainty.

     Management believes that, despite the financial hurdles and funding
uncertainties going forward, it has under development a business plan that, if
successfully funded and executed, can significantly improve operating results.
The support of the Company's creditors, vendors, customers, lenders,
stockholders and employees will continue to be key to the Company's future
success.

(3) Goodwill and Fresh-Start Reporting

     As a result of the confirmation of the Company's Plan of Reorganization on
November 6, 2001, we adopted fresh-start reporting as required by Statement of
Position 90-7 "Financial Reporting by Entities in Reorganization under the
Bankruptcy Code" ("SOP 90-7"). Under fresh-start reporting, the Company's assets
and liabilities were adjusted to fair values and a reorganization value for the
entity was determined by the Company based upon the estimated fair value of the
enterprise before considering values allocated to debt to be settled in the
reorganization. The portion of the reorganization value which could not be
attributed to specific tangible or identified intangible assets for the
Reorganized Company is referred to as reorganization value in excess of amounts
allocable to identifiable assets and is reported as "Goodwill" in the financial
statements. Fresh-start reporting resulted in the creation of a new reporting
entity for accounting purposes (the "Company" or the "Reorganized Company") with
no accumulated deficit as of November 1, 2001. As a result of adopting SFAS No.

                                      F-6

<PAGE>


142, the goodwill recognized in fresh-start reporting will not be amortized, but
will be reviewed annually for impairment. The Company determined that the
goodwill is not impaired as of December 31, 2003, however future impairment of
the recorded goodwill may result if actual results of operations or changes in
economic or industry conditions differ significantly from assumptions used to
derive the reorganization value.


(4) Reorganization Charges

     During 2003 and as a result of the emergence from bankruptcy, the Company
incurred significant reorganization and restructuring expenses, including
additional expenses incurred in settling outstanding liabilities of $280,000,
professional fees of $290,000 and a write-off of fixed assets of $330,000 due to
the devaluation and disposal of equipment.

     In December 2002, the Company decided to close its data center facility in
Atlanta and more fully capitalize on its strategic relationship with its
collocation facility partner. As a result of this decision, the Company recorded
a charge of $900,000 related to the buyout of our lease, write-off of $1.1
million of fixed assets associated with the build-out of the data center and a
$2.5 million charge for the impairment of intangible assets


(5) Summary of the Company's Significant Accounting Policies

     The accompanying consolidated financial statements include eNucleus, Inc.
and its wholly owned subsidiaries Financial ASPx, Inc. and Alliance Net, Inc.
eNucleus Pro, Inc., which was a wholly owned subsidiary of eNucleus, Inc., was
sold along with its liabilities within a settlement agreement with a creditor in
2003 for an insignificant amount. All significant intercompany accounts and
transactions have been eliminated in consolidation.

Use of 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 revenues and expenses during the
reporting period. Actual results could differ from those estimates.

Revenue Recognition

     The Company recognizes revenue upon providing of service or delivery to
client. Billings made or payments received in advance of providing services are
deferred until the period these services are provided. Certain of the Company's
contracts, include up-front charges for installation or other set up services.
The Company defers such revenue and recognizes revenue ratably over the contract
terms. Certain contracts with customers may contain service level commitments,
which may required the Company to provide credits if required service level
commitments are not met. These amounts, if any, are accounted for in cost of
sales. To date, credits issued under these arrangements have been immaterial.

     Revenue from multi-year software licensing arrangements are accounted for
as subscriptions, with billings recorded as unearned revenue and recognized as
revenue ratably over the billing coverage period. Revenue for retail packaged
products, products licensed to original equipment manufacturers (OEMs), and
select sales of certain source code of a software product is generally
recognized as products are shipped, with a portion of the revenue recorded as
unearned due to undelivered elements including, in some cases, free
post-delivery telephone support or the right to receive unspecified
upgrades/enhancements on a when-and-if-available basis for a period of time. The
amount of revenue allocated to undelivered elements is based on the sales price
of those elements when sold separately. The total fair value of the undelivered
elements is recorded as unearned, and the difference between the total
arrangement fee and the amount recorded as unearned for the undelivered elements
is recognized as revenue related to delivered elements. Unearned revenue due to
undelivered elements is recognized ratably over the service period specified or
estimated product life.

                                      F-7

<PAGE>


Financial Instruments and Concentration of Credit Risk

     The carrying value of the Company's financial instruments, including cash
and cash equivalents, accounts receivable, bank borrowings and debt approximates
their fair market value. The Company's customer base is composed of businesses
throughout the United States. The Company performs ongoing credit evaluations of
its customers and maintains reserves for potential losses.

Property and Equipment

     Property and equipment are stated at cost and depreciated on a
straight-line basis over their respective estimated useful lives, which are
generally three to seven years. In accordance with the fresh-start reporting,
the value of the fixed assets was adjusted to fair market value. Equipment
utilized for specific client applications are depreciated over the life of that
customers contract. Leasehold improvements are amortized over the shorter of the
lease period or their estimated useful life using the straight-line method.
Maintenance and repairs are charged to expense as incurred, improvements are
capitalized.

Income Taxes

     The Company uses the asset and liability method of accounting for income
taxes. Under this method, deferred tax assets and liabilities are determined
based on the difference between the financial statement and tax bases of assets
and liabilities using enacted tax rates in effect for the year in which the
differences are expected to affect taxable income. Valuation allowances are
established when necessary to reduce deferred tax assets to the amounts expected
to be recovered.

Stock-Based Compensation

     The Company uses the intrinsic value-based method to account for its
employee stock-based compensation grants and provides pro forma disclosures of
net loss as if the fair value method had been applied in measuring compensation
expense. Expense associated with stock-based compensation is being amortized
over the vesting period of the individual options. Charges for non-employee,
stock-based compensation are measured using fair value-based methods.

Goodwill and Other Intangible Assets

     In July 2002, the FASB issued Statement of Financial Accounting Standards
("SFAS") No. 141, "Business Combinations," and SFAS No.142, "Goodwill and Other
Intangible Assets." SFAS 141 requires that the purchase method of accounting be
used for all business combinations initiated after June 30, 2002. SFAS 141 also
specifies criteria that intangible assets must meet in order to be recognized
and reported separately from goodwill. SFAS 142 requires that goodwill and
intangible assets with indefinite useful lives will no longer be amortized to
expense, but instead will be tested for impairment at least annually. Intangible
assets with definite useful lives will be amortized to expense. In accordance
with SOP 90-7 and the application of fresh-start reporting, the Company adopted
SFAS No. 141 and SFAS No. 142. The adoption of SFAS No. 141 had no impact on our
consolidated financial statements. The adoption of SFAS No. 142 results in the
classification of the reorganization intangible recognized in fresh-start
reporting as goodwill with an indefinite life. As a result, the goodwill will
not be amortized, but will be reviewed annually for impairment.

     The Company evaluates its long-lived assets, including goodwill, for
impairment whenever events or change in circumstances indicate that the carrying
amount of such assets or intangibles may not be recoverable. Recoverability of
assets to be held and used is measured by a comparison of the carrying amount of
an asset to future net cash flows expected to be generated by the asset. If such
assets are considered to be impaired, the impairment to be recognized is
measured by the amount by which the carrying amount of the assets exceeds the
fair value of the assets. Assets to be disposed of are reported at the lower of
the carrying amount or fair value less costs to sell.

     In December 2002, the Company decided to close its data center facility in
Atlanta and more fully capitalize on its strategic relationship with its
collocation facility partner. As a result of this decision, the Company recorded
a charge for an impairment of goodwill of approximately $2.5 million and a
write-off of fixed assets of approximately $1.1 million. During 2003, the
Company recorded an impairment related to the goodwill associated with the
Company's most recent acquisitions, including Strategic Business Group and costs
incurred related to MIT Consulting, eliminating $170,000 representing the
remaining goodwill associated with these transactions and also recorded a
write-off of fixed assets of approximately $330,000 due to the devaluation and
disposal of equipment.

                                      F-8

<PAGE>


Net Loss Per Share

     The Company computes net income per share in accordance with SFAS No. 128,
"Earnings Per Share." Under the provisions of SFAS No. 128, basic net income per
share is computed by dividing net income for the period by the weighted average
number of common shares outstanding during the period. Diluted net income per
share is computed by dividing net income for the period by the weighted average
number of common and common equivalent shares outstanding during the period. The
following table discloses the components of earnings per share as required by
SFAS No. 128:

     For purposes of computing net loss per share during 2002 until such time
the shares were issued, the Company used the estimated number of shares to be
issued under the Plan of Reorganization, including those to be issued to certain
holders of unsecured creditor claims, those to the shareholder of the
Predecessor Company reflecting a 1 for 6 reverse split and other shares issuable
under terms of the Plan of Reorganization.

     Diluted net loss per share does not include the effect of the following
common equivalent shares as the effect of their inclusion is antidilutive during
each period:

                                                         Year Ended December 31,
                                                         -----------------------
                                                               2003        2002
                                                               ----        ----
          Shares issuable pursuant to warrants to
          purchase common stock                               100,000    100,000
          Shares issuable pursuant to the convertible
          preferred stock                                   8,552,229       --
          Shares issuable pursuant to warrants to
          purchase convertible preferred stock              2,500,000       --



(6) Business Combinations

     During 2002, the company completed one acquisition, Strategic Business
Group ("SBG") a company specializing in a proprietary methodology for critical
process mapping, which allows customers to map current business processes as
well as the transitional processes that will be required to implement software
solutions acquired from eNucleus. Additionally, SBG has extensive experience in
software selection, implementation and process improvement consulting.
Consideration paid was through the assumption of certain net liabilities of
approximately $100,000 and a stock earn-out over the subsequent twenty-four
month period equal to 50% of the net earnings of the acquired asset operations.
In the fourth quarter of 2003, this agreement was terminated and the stock due
under the earn out provision was included within an overall settlement made with
the original principal shareholder of SBC.

     In May 2003 the Company announced that we had signed an agreement for the
acquisition of certain assets and operations of Millennium Information and
Technology Consultants, LTD. ("MIT"). Upon final due diligence and review, it
was decided that the acquisition would not be concluded but rather a strategic
relationship would be entered into, thereby giving eNucleus access into the
MIT'S resources and client relationships and giving MIT access to resell
eNucleus' product offerings and services. At the time of this filing the
strategic relationship had not been concluded.

(7) Financial Statement Components

Accounts Receivable

     Accounts receivables are shown net of the allowances for doubtful accounts
of $36,000 and $32,000 for 2003 and 2002, respectively.

                                      F-9

<PAGE>


Property and Equipment

     Property and equipment consisted of furniture, fixtures, and computer
equipment and are net of accumulated depreciation of $8,000 and $172,000 as of
December 31, 2003 and 2002, respectively. Associated with the write off and
disposal of certain equipment related to the reorganization, the Company
incurred a loss of approximately $330,000.

  Accrued Expenses

         Accrued expenses consisted of the following:

                                                          December 31,
                                                          ------------
                                                     2003             2002
                                                     ----             ----
           Accrued interest                       $       0        $  15,395
           Accrued payroll and commissions           32,565          143,656
           Tax liabilities                          208,934          208,934
           Professional fees                         14,500           53,500
           Other                                     11,614           30,676
                                                  ---------        ---------
                                                  $ 267,613        $ 452,161
                                                  =========        =========
(8) Bank Borrowings and Debt

As of December 31, 2003 the Company's total long-term debt outstanding was as
follows:

                  Reorganized Company--
                      Bank Note Payable                       90,681
                      Tax Claim Notes Payable                219,474
                      Other Notes Payable                    191,952
                                                           ---------
                                                             502,107
                  Less current maturities                   (156,861)
                                                           ---------
                                                           $ 345,246
                                                           =========

     As part of the Plan of Reorganization, the Company entered into a borrowing
facility with Sunami. In accordance with the Plan of Reorganization, Sunami (or
others who shall provided post-petition financing) shall receive on account of
the borrowings, five shares of New Common Stock for every ten dollars loaned and
a Senior Secured Note for the amount of the borrowings. As of December 31, 2003,
eNucleus had received approximately $1 million of value under this facility the
proceeds of which have been used to satisfy certain petitions resulting from the
bankruptcy and post-petition operating requirements. During 2002, Sunami agreed
to convert approximately $700,000 of Senior Secured Note into equity and the
remaining was converted into equity during 2003.

     Pursuant to the Sunami financing agreement, in December, 2001, the Company
also entered into a three-year $545,000 secured demand loan agreement with
Capital Equity Group. The note agreement is secured by certain of our assets,
guaranteed by John Paulsen, our CEO and bears interest at the rate of 16%.
During the second quarter of 2002 Capital Equity Group notified the Company that
they would not be able to satisfy the lending requirements of the facility (the
Company received approximately $212,000 under this facility). As part of the
emergence from bankruptcy in November 2003, the Company reached agreement with
the holders of such notes to convert into equity.

     As part of our Plan of Reorganization , the Bank Note Payable of $500,000
plus accrued interest and attorney's fees was restructured into a three year
secured note in the amount of the total allowed claim less $225,000 which is
payable by the Company as soon as reasonably practicable. During 2002, the
Company has paid $50,000 toward the $225,000 payment due. The note is secured by
a first priority lien on all of the Company's Litigation Claims and a second
priority lien on all other assets of the Company. As part of the emergence from
bankruptcy in November 2003, the Company and certain unrelated third parties
reached agreement with the Bank, whereby the third parties assumed ownership of
the Bank of America note. Associated with this transaction, the Company issued
shares of common stock to the third party in acceptance of the conversion of
certain amounts due. The remaining balance represents unconverted amounts still
due.

                                      F-10

<PAGE>


     Holders of allowed tax claims, including the Internal Revenue Service and
certain state revenue agencies, received in full satisfaction, settlement of and
in exchange for its tax claim, a six year 6.5% promissory note in an amount
equal to the principal amount of its tax claims, payments of principal and
interest due monthly. The Company is currently restructuring its payment plan
associated with the terms of the agreements.

     Other notes payable include a 3-year note payable to a previous landlord of
the Company in the amount of its total allowed claim of approximately $142,000.
Monthly payments of $1,000 are due with the first payment in each year due of
$10,000. The final payment will include the remaining outstanding principal plus
accrued interest. No payments have been made against this note. Also included in
other notes payable is a note payable to a unsecured claimant prior to the
Company's filing of bankruptcy, who in accordance with the Plan of
Reorganization, elected to take a Junior Secured Note on the portion of the
unsecured claim. Such note accrues interest at 12% per annum with principal and
interest due in twenty-four months from the date of issuance. No payments have
been made against this note.

(9) Stockholders' Equity

     Pursuant to the Plan of Reorganization, the Company filed an Amended and
Restated Certificate of Incorporation with the Delaware Secretary of State. The
Company's Certificate of Incorporation authorizes the issuance of 100,000,000
shares of common stock, par value $.001 per share, and 20,000,000 shares of
preferred stock, par value $.001 per share. The first series of preferred stock
has been defined as the Series A Convertible Preferred Stock. Such series is
convertible into common stock at a conversion rate of 5 shares of common stock
for each share of Series A Preferred Stock. The Series A also contains a
mandatory conversion feature upon a future reverse stock split or an increase in
the number of authorized shares of Common Stock.

     In accordance with the Plan of Reorganization, all outstanding shares of
old common stock (ENCS) and warrants and options to purchase old common stock
were cancelled. As part of the distribution of the New Common Stock under the
Plan of Reorganization, shareholders were to tender their Old Common Stock to
the Reorganized Company designated Stock Transfer Agent no later than October
15, 2002, in accordance with written instructions provided to such holders, and
in exchange would receive one share of new common stock for every six shares of
old common stock previously owned. Any shareholder who did not submit its
certificates for exchange prior to October 15, 2002 had its claim or interest
and its distribution pursuant to the Plan of Reorganization on account of such
Old Common Stock discharged and shall be forever barred from asserting any such
claim or interest against the Reorganized Company or their respective property.
Approximately 180,000 shares of new common stock were issued under this
exchange. Additionally, approximately 280,000 shares were issued in exchange for
holders of certain allowed claims under the Plan of Reorganization. Such holders
of allowed claims received 1 share of common stock for every $30.00 of debt
claim approved. Any creditor who did not submit its appropriate paperwork for
the stock exchange prior to December 23, 2002 had its claim or interest and its
distribution pursuant to the Plan of Reorganization on account of such claim
discharged and shall be forever barred from asserting any such claim or interest
against the Reorganized Company or their respective property.

     As part of the Plan of Reorganization, the Company entered into a borrowing
facility with Sunami. In accordance with the Plan of Reorganization, Sunami (or
others who shall provided post-petition financing) shall receive on account of
the borrowings, five shares of New Common Stock for every ten dollars loaned and
a Senior Secured Note for the amount of the borrowings. As of December 31, 2003,
eNucleus has received approximately $1 million of value under this facility the
proceeds of which have been used to satisfy certain petitions resulting from the
bankruptcy and post-petition operating requirements. During 2002, Sunami agreed
to convert approximately $700,000 of Senior Secured Note into equity and the
remaining was converted into equity during 2003.

     Pursuant to the Sunami financing agreement, in December, 2001, the Company
also entered into a three-year $545,000 secured demand loan agreement with
Capital Equity Group. The note agreement would have been secured by certain of
our assets, guaranteed by John Paulsen, our CEO and bears interest at the rate
of 16%. During the second quarter of 2002 Capital Equity Group notified the
Company that they would not be able to satisfy the lending requirements of the
facility (the Company received approximately $212,000 under this facility). As
part of the emergence from bankruptcy in November 2003, the Company reached
agreement with the holders of such notes to convert into equity.

                                      F-11

<PAGE>

     During 2003, the Company has issued approximately 100,000 shares of common
stock subject to an investment banking and acquisition support consulting
agreement, 170,000 shares pursuant to a financing arrangements, 200,000 shares
for investor relations and marketing support, 750,000 shares pursuant to debt
conversion agreements and 340,000 shares to certain employees pursuant to their
employment agreements and/or in lieu of cash compensation during the period. As
part of the Company's emergence from bankruptcy in November 2003, the Company
reached agreement with certain note holders and creditors for the agreement to
convert approximately $2 million of outstanding and contingent obligations into
4.7 million shares of common stock and 1.45 million shares of Series A
Convertible Preferred Stock, which have a conversion rate of 5 shares of common
stock for each share of Series A Preferred Stock.

     At various times during 2002, certain holders of debts outstanding agreed
to convert amounts outstanding into new common stock. A total of $2.6 million of
obligations agreed to conversion, including $900,000 of future lease obligations
under the termination of the data center lease, $700,000 of financing provided
through Sunami and $1 million of post-petition administrative claims.
Approximately 1.2 million shares were issued in conjunction with these
conversions. Associated with the post-petition administrative claims conversions
are certain clauses that could result in additional shares being issued to the
creditors or shares being returned to the Company, based upon certain future
stock prices and/or the eventual liquidation prices achieved by the shareholders
in relation to their cost basis. On December 2, 2002 the Company issued 5,000
shares of common stock in connection with its acquisition of Strategic Business
Group, Inc. ("SBG"). Additionally, the principal shareholder of SBG will be
entitled to a stock earn out over the subsequent twenty-four month period equal
to 50% of the net earnings of the acquired asset operations. In the fourth
quarter of 2003, this agreement was terminated and the stock due under the earn
out provision was included within an overall settlement made with the original
principal shareholder of SBC.

     Subsequent to year end, the Company has issued approximately 500,000 shares
of common stock, including 440,000 shares pursuant to a financing arrangement,
55,000 shares subject to a settlement and conversion of certain liabilities
outstanding .

     Subsequent to year-end, the Board of Directors authorized and shareholders
approved a one for ten reverse stock split of all issued and outstanding common
stock, effective February 18, 2004. The par value of the common stock was
maintained at the pre-split amount of $.001 per share and the authorized capital
was maintained at 100,000,000 shares of common stock, and the par value of the
preferred stock was maintained at the pre-split amount of $0.001 per share, and
the authorized capital was maintained at 20,000,000 shares of preferred stock.
All references to common shares and per share amounts in these consolidated
financial statements and notes to consolidated financial statements have been
restated to reflect this reverse stock split on a retroactive basis, exclusive
of fractional shares.

     Subsequent to year end, the Company privately sold 277,778 shares of Series
B Preferred stock along with a warrant to purchase 250,000 shares of Series B
preferred stock at the face value of $1.00 per share for the consideration of
$250,000 in funding.

     Subsequent to year end and subject to certain contingencies, Congruent
Ventures has agreed to transfer up to 394,777 of their eNucleus preferred stock
holdings and 206,000 warrants to John Paulsen in consideration of among other
things Mr. Paulsen agreeing to serve as Chairman & CEO for a period of no less
than 12 months.

     Subsequent to year end and beginning May 1, 2004, Congruent Ventures' CEO,
Dhru Desai, agreed to join eNucleus' management team as President and serve as a
member of the Company's Board of Directors.

(10) Stock Options and Warrants

     In March, 2002, upon the expiration of the employment agreements of Mr.
Paulsen and Mr. Voss, the Company granted options to purchase up to 250,000
shares of common stock, respectively, at a price equal to the market price on
date of grant. Such options were granted for the consideration and incentive to
continue employment and at a substantially reduced salary through the remainder
of 2002 and until such time the Company provides positive cash flow operating
earnings.

     In accordance with the Plan of Reorganization, the Company agreed to issue
warrants to purchase 100,000 shares of common stock to certain unsecured
creditors pro rata in accordance with the amount of their allowed claims. The
Warrants give the holders thereof the right to purchase, at any time for a
period of seven years from the date of issuance (i.e., the effective date of the
Plan), one share of the New Common Stock at a price of $2.00 per share. The
Warrants also contain a "Cashless Exercise" provision which provide that in the
event the stock has traded at an average price in excess of $20.00 per share for
at least 30 days preceding an exercise of any warrants, the holders thereof may
elect to exercise the Warrants in whole or in part and instruct the Company to
withhold from the securities issuable upon exercise, a number of securities,
valued at the current fair market value on the date of exercise, as the payment
of the exercise price. The Company has not yet issued these warrants.

                                      F-12

<PAGE>
<TABLE>
<CAPTION>

     In conjunction with certain issuances of the Series A Preferred Stock, the
Company issued a warrant to purchase 500,000 shares of Series A Convertible
Preferred Stock at a purchase price of $1.00 per share.

Fair Value Disclosures

     The Company uses the intrinsic value method in accounting for its employee
stock-based compensation plans. Had compensation cost been determined in
accordance with SFAS No. 123 for all of the Company's employee stock-based
compensation plans, net loss and net loss per share would have been changed to
the amounts indicated below (in thousands, except per share data):


                                                     Year Ended     Year Ended
                                                       Dec. 31        Dec. 31
                                                        2003           2002
                                                        ----           ----
           Net loss
           As reported                                $(1,461)       $(5,758)
           Pro forma                                   (1,461)        (5,758)
           Basic and diluted net loss per share:
           As reported                                 $(0.28)        $(2.50)
           Pro forma                                    (0.28)         (2.50)

     The fair value of each stock option and warrant is estimated on the date of
grant using the Black-Scholes option pricing model with no expected dividends,
expected lives of the contractual term (generally 10 years), risk-free interest
rates of 4.2-6.5% and volatility of 260%.

  A summary of the Company's option activity for the years ended December 31,
2003 and 2002 are as follows:

                                                          2003                                2002
                                                          ----                                ----

                                               Shares             Shares            Shares            Shares
                                               ------             ------            ------            ------
<S>                                                       <C>            <C>                  <C>            <C>
Outstanding at beginning of year                          0              $0.00                0              $0.00
Granted                                                   0               0.00        5,000,000               0.01
Forfeited/Cancelled                                       0               0.00                0               0.00
Exercised                                                 0               0.00        5,000,000               0.01
                                          -------------------------------------------------------------------------
Outstanding at the end of the year                        0               0.00                0               0.00
                                                          -               ----                -               ----
                                          -------------------------------------------------------------------------

Exercisable at the end of the year                       --                 --               --                 --
                                                         --                 --               --                 --

     The weighted average fair value of options granted during the years ended
December 31, 2003 and 2002 was $0.01.

     As of December 31, 2003, there were no outstanding options that were issue.
In conjunction with the Plan of Reorganization, the Company is to issue options
to purchase up to 100,000 share of common stock at a purchase price of $2.00.
However, the Company has not yet issued these options and therefore are not
included in the table above.

     There were not warrants issued to purchase common stock during 2002 or
2003. A summary of the Company's warrant activity for preferred stock for the
years ended December 31, 2003 and 2002 are as follows:


                                                          2003                                2002
                                                          ----                                ----
                                                             Weighted Average                    Weighted Average
                                               Shares         Exercise Price        Shares        Exercise Price
                                               ------         --------------        ------        --------------
Outstanding at beginning of year                          0              $0.00                0              $0.00
Granted                                             500,000               1.00                0                  0
Forfeited                                                 0                  0                0                  0
Exercised                                                 0                  0                0                  0
                                          -------------------------------------------------------------------------
Outstanding at the end of the year                  500,000               1.00                0                  0
                                          -------------------------------------------------------------------------

Exercisable at the end of the year                  500,000              $1.00                0                  0
                                          -------------------------------------------------------------------------

The weighted average fair value of warrants granted during the years ended
December 31, 2003 was $1.00.

                                      F-13
</TABLE>

<PAGE>


(11) Commitments and Contingencies

Leases

     The Company's rent expense was $117,000, $153,000 for the year ended
December 31, 2003 and 2002, respectively. The Company currently leases office
space on a month to month basis, with a total monthly cost of approximately
$3,000.

Contingencies

     The Company is engaged in certain legal actions arising in the ordinary
course of business. The Company believes that it has adequate legal defenses and
that the ultimate outcome of these actions will not have a material effect on
the Company's financial position and results of operations. Prior to our filing
for protection under bankruptcy, the Company was a party to several creditor
collection actions. However, as a result of our bankruptcy filing, these matters
and many other threatening proceedings have been resolved and terminated. The
Company believe that there is no proceeding threatened or pending against us
which, if determined adversely, would have a material adverse effect on the
financial condition or results of operations of eNucleus.

     As part of the bankruptcy filing, all executory contracts and unexpired
leases, which were not previously assumed or rejected by the Company or
otherwise not specifically assumed as part of the Plan of Reorganization, were
deemed rejected. Certain contract providers continued to provide services to the
Company, even though such contract was deemed terminated, and have requested
payments due for services rendered to the Company of approximately $350,000. The
Company has not recorded such liabilities in its financial statements and
expects to aggressively defend itself against such payments requested.

(12) Related-party transactions.

     As part of the Plan of Reorganization, the Company entered into a borrowing
facility with Sunami Ventures, LLC ("Sunami") (a limited liability company
managed and controlled by Mr. Henry Paulsen, John Paulsen's father). In
accordance with the Plan of Reorganization, Sunami (or others who shall provided
post-petition financing) shall receive on account of the borrowings, five shares
of New Common Stock for every ten dollars loaned and a Senior Secured Note for
the amount of the borrowings. As of December 31, 2003, eNucleus has received
approximately $1 million of value under this facility the proceeds of which have
been used to satisfy certain petitions resulting from the bankruptcy and
post-petition operating requirements and which approximately 500,000 shares were
issued in conjunction with the facility. During 2002, Sunami agreed to convert
approximately $700,000 of Senior Secured Note into equity and the remaining was
converted into equity during 2003. Shares of common stock received from these
conversions totaled approximately 1.5 million.

     In December, 2002 the Company decided to close our data center facility in
Atlanta and requested to terminate its collocation/lease agreement with Sunami.
As a result of this decision, the Company issued approximately 450,000 of
restricted common stock as consideration for the release of $913,000 of
remaining lease obligations as well as the relinquishment of our security
deposit and the rights and title to certain leasehold improvements made to the
facility.

     During 2002 the Company issued 70,000 and 75,000 shares of common stock to
Mr. Paulsen and Mr. Voss, respectively in lieu of certain monies owed under
their compensation arrangements. In March, 2002, the Company granted options to
purchase up to 250,000 shares of restricted common stock to Mr. Paulsen and Mr.
Voss, respectively, at a price equal to the market price on date of grant. Such
options were granted for the consideration and incentive to continue employment
and at a substantially reduced salary through the remainder of 2002 and until
such time the Company provides positive cash flow operating earnings. As of
December 31, 2002, these options were fully exercised and the respective shares
had been issued.

                                      F-14

<PAGE>


(13) Income Taxes

     As part of the process of preparing the Company's financial statements,
management is required to estimate income taxes. This process involves
estimating the Company's actual current tax exposure together with assessing
temporary differences resulting from differing treatment of items. These
differences result in deferred tax assets and liabilities. The Company assesses
the recoverability of its deferred tax assets in accordance with the provisions
of FAS 109. In accordance with that standard, the Company recorded a full
valuation allowance for its net deferred tax assets as of December 31, 2003. The
Company intends to maintain a full valuation allowance for its net deferred tax
assets and net operating loss carryforwards until sufficient positive evidence
exists to support the reversal of the remaining reserve. Until such time, except
for minor state and local tax provisions, the Company will have no reported tax
provision, net of valuation allowance adjustments. In the event the Company was
to determine, based on the existence of sufficient positive evidence, that it
would be able to realize its deferred tax assets in the future in excess of its
net recorded amount, an adjustment to the valuation allowance would increase
income in the period such determination was made.

     As of December 31, 2000, the Company had generated net operating loss
carryforwards of approximately $32 million. The Company recorded a valuation
allowance for the full benefit of the loss carryforward. During 2001 the Company
filed for bankruptcy protection. As a result of the approved Plan of
Reorganization, there has been a substantial change in ownership resulting from
the creditors conversion into common stock and other matters. Federal and state
tax laws impose significant restrictions on the utilization of net operating
loss carryforwards in the event of a shift in the ownership of the Company,
which constitutes an "ownership change" as defined by Internal Revenue Code,
Section 382. However, there are certain exceptions related to bankruptcy.
Management has not yet determine the impact of the bankruptcy on its loss
carryforwards, however any amounts that would arise would be fully reserved
through a valuation allowance. Subsequent to the Reorganization, the Company has
generated net operating loss carryforwards of approximately $5.5 million. The
Company has recorded a valuation allowance for the full benefit of the loss
carryforward.

(14) Segment Information

     The Company has no separately reportable segments in accordance with SFAS
No. 131 and therefore does not report operations, identify assets and/or other
resource related to business segments. The Company operates its business and
manages financial information collectively under managed services.

(15) Subsequent Events


     On January 21, 2004 eNucleus, Inc. through one of its subsidiaries
Financial ASPx,Inc. (collectively the "Company") purchased substantially all the
assets of PrimeWire, Inc. ("PrimeWire"). The Acquisition was effected pursuant
to an Asset Purchase Agreement between the Company, PrimeWire and the holders of
the capital stock of PrimeWire (the "Shareholders") dated January 21, 2004 (the
"Purchase Agreement"). Subject to the terms and conditions of the Purchase
Agreement, PrimeWire received $50,000 upon closing and a three year earn out
provision that provides for (i) quarterly cash payments of 10% of the net
revenues generated by the PrimeWire assets and (ii) quarterly stock payments of
15% of the net revenues generated by the PrimeWire assets (shares to be
determined based upon the average closing price of the 20 day period prior to
the end of each quarter). Additionally, PrimeWire has the ability to earn an
additional 7% of Net Revenues generated by Large License Deals (license
agreements in excess of $200,000 in the first 12 months of the contract) during
the first year.

     Subsequent to year-end, the Board of Directors authorized and shareholders
approved a one for ten reverse stock split of all issued and outstanding common
stock, effective February 18, 2004. The par value of the common stock was
maintained at the pre-split amount of $.001 per share and the authorized capital
was maintained at 100,000,000 shares of common stock, and the par value of the
preferred stock was maintained at the pre-split amount of $0.001 per share, and
the authorized capital was maintained at 20,000,000 shares of preferred stock.
All references to common shares and per share amounts in these consolidated
financial statements and notes to consolidated financial statements have been
restated to reflect this reverse stock split on a retroactive basis, exclusive
of fractional shares.

                                      F-15

<PAGE>
<TABLE>
<CAPTION>


(16) VALUATION AND QUALIFYING ACCOUNTS

                                                     Balance at     Charges to                  Balance
                                                     Beginning      Operating      Accounts      at End
       Accounts receivable allowance activity        of Period       Expenses    Written-off   of Period
       --------------------------------------        ---------       --------    -----------   ---------
                   (in thousands)

<S>                                                    <C>             <C>            <C>          <C>
  For the year ending December 31, 2003                 $   32          $  75          $  71        $ 36
  For the year ending December 31, 2002                 $    4          $  28          $   0        $ 32

                                                  F-16
</TABLE>