SECURITIES AND EXCHANGE COMMISSION
                             450 FIFTH STREET, N.W.
                             WASHINGTON, D.C. 20549

                                   Form 10-KSB

                        FOR ANNUAL AND TRANSITION REPORTS
                     PURSUANT TO SECTIONS 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                [X] Annual Report Pursuant to Section 13 or 15(d)of
                       The Securities Exchange Act of 1934
                   For the fiscal year ended February 29, 2004
                                       or
           [ ] Transitional Report Pursuant to Section 13 or 15(d) of
                       The Securities Exchange Act of 1934
                        For the transition period from       to
                                                       -----    -----

                         Commission File Number 001-15913

                      UNITED STATES BASKETBALL LEAGUE, INC.
             (Exact Name of registrant as specified in its charter)

                  Delaware                                     06-1120072
         (State or other jurisdiction of                    (I.R.S.  Employer
         incorporation or organization)                     Identification No.)

           46 Quirk Road, Milford, Connecticut           06460
         (Address of principal executive offices)     (Zip Code)

         Issuer's telephone number, including area code: (203) 877-9508

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

           Securities registered pursuant to Section 12(g) of the Act:
                          Common Stock - $.01 par value


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

                  Yes [ X ]                  No [   ]

     Indicate by check mark if disclosure of delinquent  filers pursuant to Item
     405 of Regulation S-K is not contained  herein,  and will not be contained,
     to the best of registrant's  knowledge,  in definitive proxy or information
     statements incorporated by reference in Part III of this Form 10-KSB or any
     amendments to this Form 10-KSB. [ X ]

     State issuer's revenues for its most recent fiscal year: $581,087

     As of  June  10,  2004,  the  aggregate  market  value  of the  voting  and
     non-voting common equity held by non-affiliates was approximately $774,200.

                    APPLICABLE ONLY TO CORPORATE REGISTRANTS

     Indicate  the  number of  shares  outstanding  of each of the  registrant's
     classes of common stock, as of the latest practicable date.

     The number of shares of the  registrant's  common stock  outstanding  as of
     June 10, 2004 was 3,485,502 shares.

     The number of shares of the registrant's  preferred stock outstanding as of
     June 10, 2004 was 1,105,679 shares.


<PAGE>





ITEM  1.          DESCRIPTION OF BUSINESS

a)       History

         The United States Basketball League ("USBL", "we" or the "Company") was
incorporated  in  Delaware  in  May,  1984  as  a  wholly-owned   subsidiary  of
Meisenheimer  Capital,  Inc.  ("MCI").  MCI was and is a publicly  owned company
having made a  registered  public  offering of its common  stock in 1984.  Since
1984, MCI has been under the control of the  Meisenheimer  family  consisting of
Daniel T. Meisenheimer III, his brother, Richard Meisenheimer,  and their father
and  mother,  Daniel  Meisenheimer,  Jr.  and Mary  Ellen  Meisenheimer.  Daniel
Meisenheimer,  Jr. died in September,  1999. Members of the Meisenheimer  family
also have a controlling interest in Spectrum Associates,  Inc.  ("Spectrum"),  a
company  engaged in the  manufacture  of  helicopter  parts.  From time to time,
Spectrum  has loaned  money to us and has  engaged in other  revenue  generating
transactions with us.

b)       Operations

         We were  incorporated by MCI for the purpose of developing and managing
a  professional  basketball  league,  the United States  Basketball  League (the
"League").  The League was originally conceived to provide a vehicle for college
graduates  interested in going professional with an opportunity to improve their
skills and to showcase their skills in a professional environment. This approach
affords  the players an  opportunity  to perhaps be selected by one of the teams
comprising the National Basketball Association ("NBA") and to attend summer camp
sponsored by that team.  Today,  our players also consist of free agents seeking
to join an NBA  team.  USBL's  season  (April  through  June of each  year)  was
specifically  designed to afford our League players the chance to participate in
the  various  summer  camps  run by the  teams in the NBA,  which  summer  camps
normally start in August each year.  Since 1984 and up to the present time there
have been  approximately 150 players from our League who also have been selected
to play for teams in the NBA. A sizable  number of our players  were  eventually
selected to play in NBA all star games.  Additionally,  a total of approximately
75  players  were  previously  selected  each  year to  play in the  Continental
Basketball  Association ("CBA") and the National  Basketball  Development League
(the "NBDL"), the official developmental league of the NBA.

         Since the inception of our League,  we have been  primarily  engaged in
selling  franchises  and  managing  the League.  From 1985 and up to the present
time, we have sold a total of approximately  forty active franchises  (teams), a
vast  majority of which were  terminated  for  non-payment  of their  respective
franchise  obligations.  For the 1999  season  (ending in  August,  1999) we had
thirteen active franchises and two inactive  franchises.  After the 1999 season,
two franchises  were canceled for their failure to meet  franchise  obligations.
For our 2000 season,  which began in May, 2000, we had eleven active franchises.
For the 2001 season, which began on May 30 and ended on July 1, 2001, we had ten
active  franchises.  One franchise  active during the 2001 season was terminated
for failure to pay its annual  franchise  fees. For the 2002 season,  we had ten
active  franchises.  For the 2003 season we had nine active  franchises  and two
inactive franchises which were current in paying their franchise fees. These two
inactive



                                       2
<PAGE>

franchises  were  activated  for the 2004  season  which  began  in April  2004.
Accordingly, we now have eleven active franchises.

         As the League is  presently  constituted,  each team  within the League
maintains  an active  roster of eleven  players  during the season and each team
plays thirty games per season. We have playoffs at the conclusion of the regular
season. Under the terms of our Franchise  Agreements,  each franchise is limited
to a $47,500  salary cap for all players for each season.  No player can receive
more than $1,000 a week as salary.

         Since the  inception of the League to the present  time,  the number of
active  franchises  has  fluctuated  from a low of  seven  to a high in the 1999
season of 13 franchises. The current active franchises, divided into the Eastern
and  Midwest  Divisions,  are  located  in Dodge  City,  Kansas  (the Dodge City
Legend);  Enid,  Oklahoma  (the  Oklahoma  Storm);  Salina,  Kansas  (the Kansas
Cagerz);  Lehigh,  Pennsylvania (the Pennsylvania Valley Dawgs);  Brooklyn,  New
York (the Brooklyn Kings);  Melbourne,  Florida (the Brevard Blue Ducks);  Glens
Falls, NY (the Adirondack  Wildcats);  White Plains,  New York (the  Westchester
Wildfire); St. Louis, Missouri (the St. Louis Skyhawks); Cedar Rapids, Iowa (the
Cedar Rapids River Raiders); and Florence, South Carolina (the Florence Flyers).
In addition, MCI owns two inactive franchises which pay annual royalty fees, and
Spectrum Associates owns one, which pays its dues.

         At the present time we are offering  franchises for $300,000.  Our most
recent sale was in 2003 at a price of  $300,000.  We received  $50,000 as a down
payment  and the  balance  was to be paid over four years  pursuant to a payment
schedule.  The next  installment of $50,000 is due on September 1, 2004. We have
been unable to receive more than  $50,000 for a down payment on expansion  teams
and we require dues be paid prior to the year-end. This does not always allow us
to receive  all of the  installments  due on time.  We  therefore  work with our
franchisees to allow them to meet their local market obligations and carry their
balance  with the  League  until  they can  make  payments.  This is in the best
interest of the USBL and its teams.  The stronger the teams are in their markets
and financially the stronger the League becomes.

         Since 1984, we have sold  franchises at various  prices ranging from as
little  as  $25,000  to  $300,000,  our most  recent  sales.  The  price for the
franchises  has varied  depending  on the location of the  franchise,  the prior
history, if any, and the location of existing  franchises.  Because historically
most of the franchises have not operated  profitably,  the asking price has been
negotiated and in addition we have extended highly favorable  installment plans.
Nearly all of the franchises sold by us since the beginning of our operations in
1984 and up to the present  time have been sold on an  installment  basis and at
times  the  purchasers  of the  franchises  have  not  been  able  to  meet  the
installment  terms and as a result the franchises were terminated.  Based on the
uncertainty of collecting  franchise fees, we record those revenues upon receipt
of cash  consideration  paid  or the  performance  of  related  services  by the
franchisee.  We  believe  that today we are in a  stronger  position  and have a
greater name recognition than at any time in our history. As a result, we are in
a better position to demand and receive a large down payment and installments on
a more regular basis. Discussions are now being held for new expansion teams for
2005, with a limit of 15 teams for the 2005 season.

         We  utilize  a  standard  franchise  agreement  which is on file in the
various  states where we



                                       3
<PAGE>

offer our franchises.  Under this standard franchise agreement,  the term of the
franchise is for ten (10) years with a right to renew for a similar  period.  In
addition  to the  initial  purchase  price of the  franchises,  franchisees  are
required to pay an annual  royalty fee ranging from $20,000 to $25,000 per year.
Currently  nine of the eleven active  franchises are current in their payment of
annual  royalty  fees.  One  franchise  owes  $7,000 and one owes  $10,000.  The
franchise  agreement  affords us the right to  terminate  these  franchises  for
failure  to pay the  annual  royalty  fee,  but in an  effort  to  maintain  the
continuity  of the League we have  elected not to do so. In addition and because
of our desire to have the League expand, historically, we have from time to time
adjusted  annual  royalty  fees  in  certain  situations  where  the  individual
franchise  has not been  operating  profitably.  Currently  there  have  been no
adjustments  for the annual  royalty fees due us. Our franchise  agreement  also
entitles us to receive television  revenues on a sharing basis with the teams in
connection with the  broadcasting  of regional or national  games.  While in the
past  we  have  broadcasted  on a  regional  basis,  we have  not  received  any
significant revenues. We are also entitled to receive a percentage from the sale
of team and league  merchandise which is directly sold by us, primarily over the
Internet.  Revenues earned by us from  merchandise has also been  insignificant.
Revenues  from the sale by a team of its own  merchandise  are  retained  by the
selling team. These sales have contributed to the individual team's revenues.

         Our  franchise  agreements  also  require us to use our best efforts to
obtain  sponsorships  for  each  team  and the  League.  Such  sponsorships  are
generally from local or national  corporations.  The sponsorships  which for the
last few years have been negligible generally take the form of free basketballs,
uniforms,  airline  tickets  and  discount  accommodations  for teams  when they
travel.  During the 2003  season we did  receive  discounted  air fares for team
travel from American  Airlines in exchange for  advertising in team programs and
signage at the arenas as well as advertising  on our web site. The  sponsorships
generated  by us are shared by all of the teams in the  League.  The  individual
teams  comprising  the  league are also free to seek  sponsorship  for their own
individual franchise. Some of the teams have been successful in attracting local
sponsorships  in the form of merchandise  and cash and it is these  sponsorships
that have helped support the ongoing  operations of the individual teams.  Other
teams  have not  been  successful.  The  success  of  obtaining  sponsorship  is
generally  a  function  of good  attendance  and good  media  exposure.  In some
instances  particular  franchises  cannot  generate  any  meaningful  attendance
because of a lack of media exposure. The Franchise Agreement also requires us to
provide  scheduling of all games and  officiating for all games. We also print a
full  roster  book as well as a weekly  newsletter  which  provides  information
regarding  the  League  as  well  as  individual   players  and  their  personal
statistics.  The USBL website  (usbl.com) is also a resource for the teams,  the
media and the fans, with 1,000,000 hits per month.  The website is updated daily
with statistical information and articles.

         As  previously  stated,  very  few  of  our  franchises  have  operated
profitably.  This is primarily due to the fact that  attendance and  sponsorship
has not been  sufficient to sustain a team's  expenses.  We estimate that at the
current time annual expenses for each team average  approximately  $250,000.  At
the present time only three  franchises  are operating  profitably.  The general
lack of marketing by the League and the teams is primarily  due to  insufficient
capital to properly  promote and market the  League,  which has  resulted in our
inability  and  the  individual  team's  inability  to  attract  any  meaningful
sponsorships.  As a result, the sale of additional franchises either to maintain
a constant number of franchises or to expand the League has



                                       4
<PAGE>

historically  proven difficult for us.

         From the  inception  of the League,  USBL has  generally  operated at a
loss. This has been due to the poor sale of franchises and the inability of most
of the franchises to generate sufficient revenues to pay their respective annual
royalty fees.  Because of the poor historical  record, we have been dependent on
loans from the principals and their  affiliated  companies to defray the cost of
operations.  See "Item 12 - Certain  Relationships  and  Related  Transactions."
Additionally  and  because  of our poor  performance  for at least the last four
years, our auditors have rendered  qualified opinions based on their concerns as
to our ability to continue as a going  concern.  We do believe  that the current
mix of franchises is beginning to reflect a greater spectator interest resulting
in an  increase  in  attendance.  For  Fiscal  1999  (the  1998  season),  gross
attendance  for the entire League was 153,115  attendees  which  represented  an
average of 981 attendees  per game.  The gross  attendance  for Fiscal 2000 (the
1999  season)  was   162,962-1,044   attendees  per  game,   which   represented
approximately  a 6 1/2%  increase  over the previous  year.  For the fiscal year
which ended  February  28,  2001 (the 2000  season),  attendance  for our entire
season was 248,222 gross attendees - 1,513 attendees per game. This  represented
a 52%  increase  over Fiscal  2000.  For our 2001  season,  attendance  was only
225,791-1,446  attendees per game, a decline from the prior season. For the 2002
season our attendance was  251,853-1,679  attendees per game. This represented a
10% increase over the prior year.  For the 2003 season,  attendance was 173,351-
1,536  attendees  per game.  The general  recent trend of increase in attendance
over prior years has  resulted in increased  revenues for each team.  We believe
that the increase in attendance is a positive factor and could have an effect on
the future  growth of the League and may aid in the sale of new  franchises  and
enable us to receive our full asking price for franchises.

c)       Employees

         We  currently  have a staff  in  excess  of 50  people.  We  have  four
full-time employees consisting of the chairman and League  commissioner,  Daniel
Meisenheimer III, a director of  administration,  a director of public relations
and a  director  of  operations.  The  balance of such  people  are  independent
contractors and consist of referees who are paid on a per game basis.  From time
to time we have also used independent contractors for consulting work.

d)       Future Plans

         We have, as an ultimate goal, the  establishment of at least forty (40)
franchises  throughout the United  States,  consisting of ten (10) teams in four
regional  divisions.  This would  result in regional  play-off  games and then a
final  championship  series.  We  have  been  attempting  to  develop  a  formal
association  with the National  Basketball  Association  ("NBA").  During fiscal
1998, the NBA selected us to handle a pre-draft  camp for the Korean  Basketball
League for which we received a nominal fee. We believe that a formal association
with  the NBA  would  enhance  the  value of our  franchises  and  attract  more
significant gate attendance, but there can be no assurances that we will ever be
able to  develop  a  formal  working  relationship.  Currently,  the NBA has its
development league, the NBDL. The NBDL competes against the reformed Continental
Basketball  Association.  Neither  of these  leagues  competes  with the  USBL's
season. Notwithstanding the lack of a formal relationship, the NBA is well aware
that USBL represents a potential pool of qualified players.  We will continue to
pursue a more formal relationship with



                                       5
<PAGE>

the NBA.

                                  RISK FACTORS

         Prospective  investors as well as shareholders  should be aware that an
investment in USBL involves a high degree of risk. Accordingly, you are urged to
carefully  consider  the  following  Risk  Factors  as well as all of the  other
information contained in this Annual Report and the information contained in the
Financial Statements and the notes thereto.

FORWARD LOOKING STATEMENTS

         When  used  in  this  report,  the  words  "may",   "will",   "expect",
"anticipate",  "estimate" and "intend" and similar  expressions  are intended to
identify  forward  looking  statement  within the  meaning of Section 21E of the
Securities  Exchange Act of 1934  regarding  events,  conditions,  and financial
trends  that may  affect  our  future  plan of  operations,  business  strategy,
operating results and financial position.  Prospective  investors are forewarned
and cautioned that any forward  looking  statements are not guarantees of future
performance and are subject to risks and  uncertainties  and that actual results
may differ  materially  from those  included  within  any such  forward  looking
statements.

OUR OPERATING HISTORY DOES NOT REFLECT PROFITABLE OPERATIONS

         Our  operating  history  does  not  reflect  a  history  of  profitable
operations.  Since our inception we have been  attempting to develop the League.
Our operations have not been profitable and unless and until we can increase the
sale of  franchises  and at the same time  attract  franchisees  who are able or
willing to incur start-up costs to develop their respective  franchises,  we may
continue  to  operate  at a  loss.  There  can be no  assurance  that we will be
successful.

WE MAY NOT BE ABLE TO CONTINUE AS A GOING CONCERN

         Because of our  historically  poor revenues and earnings,  our auditors
have for at least the last five years  qualified  their  opinions and  expressed
their  concern as to our  ability  to  continue  to operate as a going  concern.
Shareholders and prospective  shareholders should weigh this factor carefully in
considering the merits of our company as an investment vehicle.

WE HAVE NOT BEEN ABLE TO REALIZE THE FULL SALES VALUE OF A FRANCHISE

         Generally  speaking,  we have not been able to collect what we perceive
to be  true  value  for  a  franchise  because  of  the  League's  overall  poor
performance.  As such we have sold  franchises for less than we believe the true
value to be and  additionally  have extended  terms for payment as an additional
inducement  to the  franchisees  to purchase  the  franchise.  As a result,  our
revenues have been affected and will continue to be affected  until such time as
we are able to realize the full value for franchises.

OUR ESTABLISHED  GUIDELINES IN CONNECTION WITH THE SALE OF FRANCHISES MAY NOT BE
SUFFICIENT TO ENSURE THE VIABILITY OF A FRANCHISE OVER THE LONG TERM


                                       6
<PAGE>

         Historically  in our dealings with  prospective  franchisees and in our
desire to sell franchises,  we did not establish  adequate  guidelines to insure
that  prospective  franchisees  have  sufficient  capital to properly  finance a
franchise and to be able to absorb losses until such time as the franchise would
become profitable.  Starting with the 1999 season, we have established  rigorous
standards to ensure the viability of the franchise over the long term;  however,
there is still no assurance that in view of our inability to have any meaningful
expansion  we will  be  able  to  attract  qualified  franchisees  or  that  our
established  guidelines  will ensure the viability of a franchise  over the long
term.

WE HAVE BEEN  DEPENDENT ON LOANS AND  REVENUES  FROM  AFFILIATES  TO SUSTAIN OUR
OPERATIONS

         Because our  revenues  from third  parties  have been  insufficient  to
sustain our operations,  we have been historically dependent on revenues,  loans
and advances from the Meisenheimer  family as well as companies  affiliated with
the Meisenheimers to assist in financing.  If members of the Meisenheimer family
elected  not to  continue  to  advance  loans  to us,  our  operations  could be
drastically impaired.

WE ARE DEPENDENT ON CORPORATE SPONSORSHIPS WHICH HAVE BEEN NEGLIGIBLE

         The financial  success of the  individual  franchises is dependent to a
large degree on corporate  sponsorship to help defray costs. To date,  corporate
sponsorship  in some  cities has been  negligible  and as a result,  some of the
franchises have been required to absorb expenses which would otherwise have been
supported  by  corporate  sponsorship.  As a  result,  profits  of  some  of the
franchises  have been affected and in many instances some of the franchises have
been  operating  at small  losses.  Until such time as the  League  can  attract
meaningful  sponsorship,  earnings, if any, of the individual franchises will be
impacted.

OUR BASKETBALL SEASON COMPETES WITH OTHER PROFESSIONAL SPORTING EVENTS

         Our season from April to June is designed  to afford  players  with the
opportunity to showcase their  professional  ability to the teams comprising the
National  Basketball   Association  ("NBA")  and  to  be  possibly  selected  to
participate in NBA team's summer camps in the latter part of July and August. As
such, our schedule competes with other sporting events such as the NBA playoffs,
baseball,  golf and  tennis.  Additionally,  our  season  comes  at a time  when
spectators might normally prefer to be outdoors rather than indoors in an arena.
These factors have had some impact on the League's overall attendance,  although
attendance has continued to improve.

WE LACK SUFFICIENT CAPITAL TO PROMOTE THE LEAGUE

         In order for the League to become  successful,  we have to promote  the
League.  Historically  and up to the present  time,  we have  lacked  sufficient
capital to develop a national  promotion for the League.  Promotion will achieve
two objectives: (i) create more fan interest, and (ii) franchise interest. Until
such time that we can  properly  promote  the  League we do not



                                       7
<PAGE>

anticipate any significant change in the overall fan interest,  and consequently
no  significant  change in sales of  franchises.  While  attendance has recently
improved,  it is still  rather  small  and is not  enough  to  support  a team's
operations. Additionally, interest in franchises has increased, but without real
promotional   efforts,  we  do  not  anticipate  any  significant   increase  in
franchises.

THE MEISENHEIMER FAMILY EXERCISES SIGNIFICANT CONTROL OVER US

         The  Meisenheimer  family,  consisting of Daniel T.  Meisenheimer  III,
Richard C. Meisenheimer and Mary Ellen Meisenheimer,  and companies they control
own  approximately  81% of our outstanding  common stock and as such control the
daily  affairs  of the  business  as  well  as  significant  corporate  actions.
Additionally,  the  Meisenheimer  family  controls the Board of Directors and as
such shareholders have little or no influence over the affairs of the Company.

DEPENDENCE UPON KEY INDIVIDUAL

         Our success is dependent upon the activities of Daniel T.  Meisenheimer
III. The loss of Mr. Meisenheimer through death, disability or resignation would
have a material and adverse effect on our business.

WE HAVE A LIMITED PUBLIC MARKET FOR OUR STOCK

         There are approximately 553,000 shares held by approximately 315 public
shareholders  and as such there is a limited  public  market  for our stock.  As
such, holders of our stock may have difficulty in selling their shares.

PENNY STOCK REGULATION

         Broker-dealer  practices  in  connection  with  transactions  in "penny
stocks" are  regulated by certain  penny stock rules  adopted by the SEC.  Penny
stocks  generally are equity  securities  with a price of less than $5.00 (other
than securities registered on certain national securities exchanges or quoted on
the NASDAQ System).  The penny stock rules require a  broker-dealer,  prior to a
transaction in a penny stock not otherwise  exempt from the rules,  to deliver a
standardized risk disclosure document that provides information  regarding penny
stocks  and the  nature  and  level of  risks in the  penny  stock  market.  The
broker-dealer  also  must  provide  the  customer  with  current  bid and  offer
quotations for the penny stock,  the compensation of the  broker-dealer  and its
salesperson  must disclose this fact and the  broker-dealer's  presumed  control
over the market, and monthly account statements showing the market value of each
penny stock held in the customer's  account.  In addition,  broker-dealers,  who
sell such securities to persons other than established  customers and accredited
investors,  must make a special written  determination that the penny stock is a
suitable  investment  for the  purchaser  and  receive the  purchaser's  written
agreement to the  transaction.  Consequently,  these  requirements  may have the
effect of reducing the level of  activity,  if any, in the market for our common
stock.


ITEM 2.           PROPERTY


                                       8
<PAGE>


         MCI Capital  Real Estate Inc.  ("MRE"),  a wholly owned  subsidiary  of
USBL, owns the property at 46 Quirk Road,  Milford,  Connecticut.  Such property
consists of three-quarters of an acre of real property and an office building of
approximately  6,000 square feet.  USBL  maintains  its offices along with other
tenants  at the  building.  The  rental  income  from the other two  tenants  is
sufficient  to pay the monthly  mortgage  payments.  The balance on the mortgage
currently amounts to approximately $112,000.

ITEM  3.          LEGAL PROCEEDINGS

         None.

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

         None.
                                     PART II

ITEM  5.          MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED
                  STOCKHOLDER MATTERS

         The Common Stock trades on the  Over-the-Counter  Bulletin  Board under
the symbol "USBL". The following is the range of high and low closing bid prices
for the Common  Stock for each  quarter  for the  Company's  fiscal  years ended
February 28, 2003 and February 29, 2004.

<TABLE>
<CAPTION>
                                               Fiscal 2003
                                               Closing Bid

                                 <c>                         <c>
                                      High                        Low
First Quarter Ended 5/31/02          $1.12                        $.70
Second Quarter Ended 8/31/02         $1.10                        $.55
Third Quarter Ended 10/31/02          $.82                        $.60
Fourth Quarter Ended 2/28/03          $.78                        $.65

                                               Fiscal 2004
                                               Closing Bid

                                       High                        Low
First Quarter Ended 5/31/03           $1.05                        $.67
Second Quarter Ended 8/31/03          $1.35                       $1.05
Third Quarter Ended 10/31/03          $1.40                       $1.25
Fourth Quarter Ended 2/29/04          $1.45                       $1.30

</TABLE>


         The  foregoing  range  of  high-low   closing  bid  prices   represents
quotations between dealers without adjustments for retail markups,  markdowns or
commissions and may not represent actual transactions.  The information has been
provided by the National  Association  of Securities  Dealers  Composite Feed or
other qualified inter-dealer quotation medium.

                                       9
<PAGE>

         Approximately  553,000  shares  of our  Common  Stock  are  held by 315
shareholders.  The shares  held by members  of the public  were  issued by us in
connection  with a  private  placement  at  least  ten  years  ago  and  also in
connection  with an  offering  in 1995  under  Rule 504 of  Regulation  D of the
Securities  Act of 1933. The existing  holders of shares issued  pursuant to the
private  placement  would have available to them the exemption  provided by Rule
144 and thus would be able to sell all of their shares if they so elected.

         We have not paid any dividends and do not anticipate  paying  dividends
in the future.

         Our  Preferred  Stock  is  held  by  our  officers  and  directors  and
affiliates. No member of the public holds any Preferred Stock.


                      EQUITY COMPENSATION PLAN INFORMATION
<TABLE>
<CAPTION>


                                Number of securities to be    Weighted-average exercise      Number of securities
                                  issued upon exercise of       price of outstanding        remaining available for
                                   outstanding options,         options, warrants and        future issuance under
                                  warrants and rights (a)            rights (b)            equity compensation plans
                                                                                             (excluding securities
                                                                                           reflected in column (a))
                                                                                                      (c)


                             <c>                             <c>                     <c>
Equity compensation
  plans approved by                         0                           N/A                           0
security holders........


Equity compensation
 plans not approved by                      0                           N/A                           0
security holders......



 Total............                          0                           N/A                           0


</TABLE>

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


OVERVIEW

         It is  anticipated  that the Company will continue to operate at a loss
for the next twelve months. The Company did activate a new franchise  (Florence,
SC) for the 2004 season.  In addition,  a dormant  franchise (St. Louis, MI) was
activated.  It is  anticipated  that one team will be  reactivated  for the 2005
season and the Company will sell another  franchise  which will be activated for
the 2005 season.  The Company is anticipating an increase in attendance based on
higher  visibility of coaches and players in the League.  Two franchises are now
using  coaches

                                       10
<PAGE>

who enjoy high  visibility  in  basketball  - John  Starks  and Darryl  Dawkins.
Notwithstanding  an anticipated  increase in attendance,  the Company will still
have to rely on financial assistance from affiliates. The Meisenheimer family is
fully committed to making the Company a profitable operation and also making the
League a viable one. Given the current lack of capital, the Company has not been
able to develop any new programs to revitalize the League,  nor has it been able
to hire additional sales and promotional personnel.  As a result, the Company is
currently  dependent  on the efforts of Daniel  Meisenheimer,  III and two other
employees  for all  marketing  efforts.  Their  efforts have not resulted in any
substantial increase in the number of franchises.  Recently, the NBA established
a developmental  basketball league known as the National Basketball  Development
League ("NBDL"). The Company believes that the establishment of this new league,
consisting of eight teams,  will have no effect on the Company's  season,  since
the NBDL season as  presently  constituted  runs from  November  through  March.
Further, nothing prohibits an NBDL player from playing in the USBL. Accordingly,
and as of the  present  time,  the  Company  does  not  perceive  the  NBDL as a
competitor.  However,  with the establishment of the NBDL it is unlikely that at
least for the  present  time the Company  can  develop  any  meaningful  working
relationship with the NBA.

CRITICAL ACCOUNTING POLICIES

Revenue Recognition

         The Company  generally uses the accrual method of accounting.  However,
due to the  uncertainty  of  collecting  royalty  and  franchise  fees  from the
franchisees,  the USBL records these revenues upon receipt of cash consideration
paid or the performance of related  services by the  franchisee.  Franchise fees
earned  in  nonmonetary  transactions  are  recorded  at the  fair  value of the
franchise granted or the service received,  based on which value is more readily
determinable.  Upon the  granting of the  franchise,  the Company has  performed
essentially all material conditions related to the sale.

         The Company generates  advertising  revenue from fees for area signage,
tickets and program  and  yearbook  advertising  space.  Advertising  revenue is
recognized at the time the advertising space is made available to the user.

         Fees  charged  to teams to allow them to  relocate  are  recognized  as
revenue upon collection of the fee.  Souvenir sales,  which are generated on the
Company's web site,  are recorded upon  shipment of the order.  Essentially  all
orders are paid by credit card.

FISCAL YEAR 2004 COMPARED TO FISCAL YEAR 2003

         For the year ended February 29, 2004 ("Fiscal 2004") initial  franchise
fees  amounted to $155,000 as compared to $250,000  for the year ended  February
28,  2003.  In  addition,  continuing  franchise  fees  amounted  to $275,000 as
compared to  $276,000  in 2003.  The  aggregate  decrease of $96,000  (18%) is a
result of the Company's parent,  MCI, having fully paid its final installment of
its initial  franchise  fee during 2004.  Advertising  and  sponsorship  revenue
totaled  $95,000 as compared to $86,000 in 2003. The  advertising  fees for 2003
reflected a $50,000  promotional  campaign with a major airline.  The balance of
the 2003 fees and the 2004 fees were for the most


                                       11
<PAGE>

part  generated  from  an  affiliate,   Spectrum  Associates,  Inc.,  which  ran
advertisements  in  league  bulletins,  programs  and  brochures.  Other  income
increased  from  $26,000 to  $56,000,  reflecting  rental  income  generated  in
connection with the acquisition of Meisenheimer  Capital Real Estate Holdings in
May 2003.  Approximately  $240,000 and  $276,000 of the 2004 and 2003  revenues,
respectively, were derived from various related parties.

         Operating  expenses for the years ended  February 29, 2004 and February
28, 2003 approximated  $690,000 and $685,000,  respectively.  Operating expenses
for both 2004 and 2003 reflect management fees of $180,000 to MCI for management
services,  including the services provided to the Company by Daniel Meisenheimer
III and  Richard  Meisenheimer.  The  Company  eliminated  team and post  season
festival  expenses  because of a restructuring  in 2004 wherein these costs were
borne by the individual  teams.  The Company  recorded lower referee fees during
2004 because of a decrease in the number of referees used in each game. Further,
travel and  promotional  fees  increased  approximately  $55,000 to $211,000 for
2004.  This  increase  reflects  higher  travel  costs  resulting  from  greater
distances  between teams and travel to additional  League meetings in connection
with new teams and  anticipated  expansion  and  reactivation.  Other  operating
expenses remained relatively consistent.

         Net loss for the year ended February 29, 2004 approximated $129,000, as
compared to $57,000 for the year ended  February  28,  2003.  The  increase is a
result of the lower revenues generated in 2004.


LIQUIDITY AND CAPITAL RESOURCES

         The Company had a working capital deficit of approximately  $449,000 at
February 29, 2004.  The Company's  statement of cash flows reflects cash used in
operations  of  approximately  $43,000,  consisting  principally  of net loss of
$129,000 offset by a decrease in inventory ($16,000) and an increase in accounts
payable  and  accrued  expenses  ($66,000).   Net  cash  provided  by  financing
activities  approximated  $59,000,  consisting  principally of a net increase in
amounts due (to) from affiliates of $65,000.

         In May 2003 the Company  consummated a transaction with MCI wherein MCI
assigned  all of the  outstanding  shares of  Meisenheimer  Capital  Real Estate
Holdings ("MCREH") to the Company in order to satisfy a certain payable due from
MCI to the Company. The assets and (liabilities) of MCREH were recorded at their
historical cost, and included land  ($121,000),  building  ($156,000),  due from
affiliates ($174,000),  mortgage payable ($117,000), note payable ($50,000), and
other liabilities ($4,000).

         The Company's ability to generate cash flow from franchise royalty fees
is  dependent  on  the  financial   stability  of  the   individual   franchises
constituting the League. Each franchise is confronted with meeting its own fixed
costs  and  expenses  which are  primarily  paid from  revenues  generated  from
attendance.  Experience has shown that USBL is generally the last creditor to be
paid by the franchise.  If attendance has been poor,  USBL has from time to time
only  received  partial  payment  and,  in some cases,  no payments at all.  The
Company  estimates  that it  requires at least  $300,000  of working  capital to
sustain  operations over a 12-month


                                       12
<PAGE>

period. Assuming that all of the teams pay their annual royalty fees, this would
only  amount to  $240,000.  However,  the  Company  believes  that  given  prior
experience  it is more  realistic to  anticipate  royalty fees of  approximately
$170,000 because some of these teams are simply not able to generate significant
attendance at games.  Additionally,  some of the teams owe back franchise  fees.
The Company anticipates that it will receive at least $100,000 of back franchise
fees  during the next 12 months.  Adding  this to the  $170,000  of  anticipated
royalty  fees,  this could amount to $270,000 of revenues.  Accordingly,  if the
Company is unable to generate  additional sales of franchises within the next 12
months  it will  again  have to rely on  affiliates  for  loans to  assist it in
meeting its current  obligations.  With respect to long term needs,  the Company
recognizes  that in order for the League and USBL to be successful,  USBL has to
develop a  meaningful  sales and  promotional  program.  This  will  require  an
investment  of  additional  capital.   Given  the  Company's  current  financial
condition,  the ability of the Company to raise  additional  capital  other than
from  affiliates  is  questionable.  At the  current  time  the  Company  has no
definitive plan as to how to raise additional capital.

The table below summarizes aggregate maturities of future debt payments as
of February 29, 2004:

                                    Less than     1-3          4-5      After 5
                          Total       1 Year      Years       Years      Years

Mortgage payable        $111,600      $8,700    $19,500      $83,400       $ -
Note payable              50,000          -      50,000         -            -
Total                   $161,600      $8,700    $69,500      $83,400       $ -



ITEM 7.           FINANCIAL STATEMENTS

         The Financial Statements appear commencing on page F-1 hereof.




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

         None.

ITEM 8A.          CONTROLS AND PROCEDURES

         Based on their evaluation as of February 29, 2004, our management, with
the  participation  of our  President  and Chief  Financial  Officer,  being our
principal executive and principal financial officer, respectively,  conducted an
evaluation of the  effectiveness  of the design and operation of our  disclosure
controls and procedures,  as required by Exchange Act Rule 13a-15. Based on that
evaluation,  the President and Chief  Financial  Officer have concluded that our
disclosure  controls and procedures  were  effective to ensure that  information
required to be  disclosed  by us in the reports that we file or submit under the
Exchange  Act is recorded,  processed,  summarized  and  reported  with the time
periods specified by the SEC's rules and forms.


                                       13
<PAGE>


         There  were  no  significant  changes  in our  internal  controls  over
financial  reporting  that occurred  during the quarter ended  February 29, 2004
that have materially  affected,  or are reasonably likely to materially  affect,
our internal control over financial reporting.

         We  believe  that a control  system,  no matter how well  designed  and
operated,  cannot provide absolute  assurance that the objectives of the control
system are met, and no  evaluation  of controls can provide  absolute  assurance
that all control  issues and instances of fraud,  if any,  within a company have
been detected.

ITEM  9.          DIRECTORS AND EXECUTIVE OFFICERS

         The following  persons  served as our directors and executive  officers
for the fiscal year ended  February 29, 2004.  Each director  holds office until
the next annual  meeting of the  stockholders  and until his  successor has been
duly elected and qualified.  Each executive  officer serves at the discretion of
the Board of Directors of the Company.

NAME                                AGE                POSITION

Daniel T. Meisenheimer III          53      Chairman of the Board and President

Richard C. Meisenheimer             50      Chief Financial Officer and Director

BACKGROUND OF EXECUTIVE OFFICERS AND DIRECTORS

         Daniel T. Meisenheimer III ("Mr.  Meisenheimer  III") has been Chairman
of the Board and  President  of the Company  since its  inception  in 1984.  Mr.
Meisenheimer  III has also been the Chairman of the Board and  President of MCI,
USBL's  parent,  since 1983 and occupies the same  positions in Cadcom,  Inc., a
subsidiary of MCI, and Meisenheimer Capital Real Estate Holdings,  Inc. ("MCR").
Mr.  Meisenheimer  III is also a  shareholder  and  director of  Synercom,  Inc.
("Synercom"),  a Meisenheimer  family-owned  holding company which owns Spectrum
Associates, Inc., a shareholder of USBL and which company has loaned USBL funds.

         Richard   C.   Meisenheimer   ("R.   Meisenheimer"),   brother  of  Mr.
Meisenheimer  III, has acted as Chief  Financial  Officer and a Director of USBL
since the  inception  of the  business in 1983.  R.  Meisenheimer  has also been
associated with Spectrum Associates, Inc. since 1976 and is now the President of
that  Company.  Spectrum  owns 34.1% of USBL  Preferred  Stock and 6.7 % of USBL
Common Stock.  Spectrum was the main customer of Cadcom,  MCI's other subsidiary
until December, 2000 when Cadcom was sold to Synercom, another company owned and
controlled by the Meisenheimer family.

         The  Company  does not have a separate  audit  committee.  The Board of
Directors functions as the audit committee. Richard Meisenheimer qualifies as an
audit committee financial expert.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE


                                       14
<PAGE>


         Section  16(a) of the  Securities  Exchange  Act of 1934  requires  the
Company's  executive  officers,  directors  and  persons  who own more  than ten
percent  of a  registered  class of its  equity  securities  to file  reports of
ownership and changes in ownership on Forms 3, 4 and 5 with the  Securities  and
Exchange Commission. These persons are required by SEC regulation to furnish the
Company with copies of all Forms 3, 4 and 5 they file with the SEC. Based solely
upon our review of the copies of the forms the Company has received,  we believe
that all such persons  complied on a timely  basis with all filing  requirements
applicable to them with respect to transactions during fiscal 2004.

CODE OF ETHICS

         The  Company  has  not  adopted  a Code  of  Ethics  applicable  to its
principal executive officer,  principal financial officer,  principal accounting
officer or  controller.  As a small public  company with limited funds and other
resources,  the  Company  elected  not to incur the time and expense of adopting
such a plan.

ITEM  10.         EXECUTIVE COMPENSATION

         For many  years  our  only two  officers,  D.  Meisenheimer  III and R.
Meisenheimer,  have not received or taken any salaries  from USBL.  There are no
formal employment agreements between D. Meisenheimer III and R. Meisenheimer and
they have not been paid any salary for the last four  years.  MCI, of which both
D.  Meisenheimer III and R.  Meisenheimer  are also senior officers,  charged us
management fees of $180,000 during each of the years ended February 29, 2004 and
February 28 2003, as consideration  for the services provided by D. Meisenheimer
and R. Meisenheimer.

ITEM  11.         SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
                  MANAGEMENT

         We  have  30,000,000  shares  of  authorized  Common  Stock,  of  which
3,485,502 shares are currently  issued and  outstanding.  We also have 2,000,000
authorized shares of Convertible  Preferred Stock, of which 1,105,679 shares are
currently issued and outstanding.

         The following table sets forth certain  information as of June 10, 2004
with respect to the  beneficial  ownership of both our  outstanding  Convertible
Preferred  Stock (the  "Preferred  Stock") and Common Stock by (i) any holder of
more than five (5%) percent thereof; (ii) each of our officers and directors and
(iii) directors and officers of the Company as a group.

<TABLE>
<CAPTION>


                                                        Amount and Nature of                         Approximate
Name and Address of Beneficial Owner                    Beneficial Ownership                      Percent of Class


                                                   <c>                                       <c>
Daniel T. Meisenheimer III (1)                         143,998 Preferred Stock (1)                  13.0%
c/o The United States Basketball League                437,400 Common Stock                         12.7%
46 Quirk Road
Milford, CT 06460

Estate of Daniel T. Meisenheimer, Jr.(2)               182,723 Preferred Stock                       6.5%



                                       15
<PAGE>
<CAPTION>


                                                   <c>                                       <c>
c/o Spectrum Associates                                12,000 Common Stock                              *
440 New Haven Avenue
Milford, CT 06460

Richard C. Meisenheimer(3)                             142,285 Preferred Stock                      12.9%
884 Robert Treat Ext.                                  5,000 Common Stock                               *
Orange, CT 06477

Meisenheimer Capital Corp.                             140,000 Preferred Stock                      12.7%
46 Quirk Road                                          2,095,000 Common Stock                       60.8%
Milford, CT 06460

Spectrum Associates, Inc. (4)                          376,673 Preferred Stock                      34.1%
440 New Haven Avenue                                   231,857 Common Stock                          6.7%
Milford, CT 06460

All Officers and Directors as a Group                  286,283 Preferred Stock                       5.9%
                                                       442,400 Common Stock                         12.8%
</TABLE>


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

* less than 1%

(1) Includes 20,000 shares of Preferred Stock held by Mr.  Meisenheimer  III for
the benefit of his two minor  children.
(2) Mr.  Meisenheimer  Jr., who died in September, 1999, bequeathed his stock to
his wife, Mary Ellen Meisenheimer.
(3) Richard Meisenheimer, an officer and director of USBL, is also the President
of Spectrum Associates,  Inc., which owns both Preferred and Common Stock as set
forth herein.
(4) Between the various  members of the  Meisenheimer  family and an  affiliated
company, Spectrum Associates, Inc., the Meisenheimers effectively control 77% of
the  outstanding  Preferred  Stock  and  20% of the  outstanding  Common  Stock.
Including  the ownership of MCI by the  Meisenheimer  family,  they  effectively
control 81% of the outstanding Common Stock of USBL. No public  shareholders own
any Preferred Stock of USBL.

ITEM  12.         CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

a)       Loans

         For at least the last ten years,  the  principals of MCI  consisting of
Daniel Meisenheimer III, Richard Meisenheimer and Daniel  Meisenheimer,  Jr. and
their affiliated  companies have made loans to us. As of February 29, 2004, USBL
was indebted to the  principals or their  affiliated  companies in the principal
sum of  $479,800.  $429,800 of the  outstanding  debt is payable upon demand and
$50,000 is due on December 31, 2006. Of the foregoing  amount,  Spectrum is owed
the sum of $151,367.  The principals (D.  Meisenheimer  III, R. Meisenheimer and
the Estate of Daniel T.  Meisenheimer,  Jr.) are owed $278,433 and the mother of
D. Meisenheimer and R. Meisenheimer is owed $50,000.

b)       Dependency on Affiliates


                                       16
<PAGE>


         Over the years we have  received a  material  amount of  revenues  from
affiliated  persons or  entities.  During the years ended  February 29, 2004 and
February  28,  2003,  initial  and  continuing  franchise  fees  from  companies
controlled  by the  Meisenheimer  family,  including  Meisenheimer  Capital  and
Spectrum Associates, approximated $145,000 and $240,000 respectively.

         In addition,  Spectrum has purchased advertising from us in the form of
arena signage,  TV commercials,  tickets,  and program and year book advertising
space.  For the years ended  February 29, 2004 and February 28, 2003,  we earned
advertising fees of $95,000 and $36,000, respectively, from Spectrum.

c)       Acquisition of Meisenheimer Capital Real Estate Holdings, Inc.

         On May 31, 2003,  Meisenheimer  Capital,  Inc.  ("MCI") and the Company
entered into an agreement whereby MCI agreed to assign to the Company all of the
outstanding stock of Meisenheimer Capital Real Estate Holdings, Inc. ("MCRE"), a
wholly owned subsidiary of MCI, in satisfaction of certain payables due from MCI
to  the  Company  in  the  net  amount  of  $226,000.  The  consummation  of the
transaction  was subject to MCI's obtaining an appraisal of the property from an
independent  appraiser  that the value of the  property  was equal to or greater
than  $226,000,  the amount of the debt of MCI then owing to the  Company.  Such
appraisal  was received on July 7, 2003 and the shares of MCRE were  transferred
to the Company in satisfaction of the debt owing from MCI to the Company.

ITEM  13.         EXHIBITS, LIST AND REPORTS ON FORM 8-K

a)       Exhibits

*3(i)    Certificate of Incorporation (May 29, 1984)

*3(i)a   Amended Certificate of Incorporation (Sept. 4, 1984)

*3(i)b   Amended Certificate of Incorporation (March 5, 1986)

*3(i)c   Amended Certificate of Incorporation (Feb. 19, 1987)

*3(i)d   Amended Certificate of Incorporation (June 30, 1995)

*3(i)e   Amended Certificate of Incorporation (January 12, 1996)

*3(i)f   Certificate of Renewal (June 23, 1995)

*3(i)g   Certificate of Renewal (May 22, 2000)

*3.9     By-Laws of USBL

*3.10    Amended By-Laws


                                       17
<PAGE>


+10.2    Standard Franchise Agreement of USBL

21       Subsidiaries

31.1     Certification of President (principal executive officer)

31.2     Certification of Chief Financial Officer (principal financial officer)

32       Certification pursuant to 18  U.S.C.  Section 1350  as adopted pursuant
         to  Section  906  of  the Sarbanes-Oxley Act of 2002

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

*Filed  with Form 10SBA and  amendments  thereto.
+Filed  with Form  10-KSB for Fiscal Year ended February 28, 2001.

b)       Reports on Form 8-K

         None

ITEM  14.         PRINCIPAL ACCOUNTANT FEES AND SERVICES

AUDIT FEES

         We were billed by Holtz Rubenstein & Co., LLP ("Holtz  Rubenstein") the
aggregate  amount of  approximately  $32,650  and $26,000 in respect of the year
ended  February  29, 2004 and  February  28,  2003,  respectively,  for fees for
professional  services rendered for the audit of our annual financial statements
and review of our financial statements included in our Forms 10-QSB.

AUDIT-RELATED FEES

         We  were  billed  by  Holtz   Rubenstein   the   aggregate   amount  of
approximately $2,790 in respect of the year ended February 29, 2004 for fees for
assurance and related  services in fiscal 2004 that were  reasonably  related to
the  performance  of the audit review of our financial  statements  that are not
reported under the preceding  paragraph.  These services consisted  primarily of
assistance with the acquisition of  Meisenheimer  Capital Real Estate  Holdings,
Inc. No such fees were billed to us by Holtz  Rubenstein  in respect of the year
ended February 28, 2003.

TAX FEES

         We have not incurred  expenses or been billed by Holtz  Rubenstein  for
the  year  ended  February  29,  2004 or  February  28,  2003  for  fees for tax
compliance, tax advice or tax planning services.


                                       18
<PAGE>


ALL OTHER FEES

         There were no other fees billed to us by Holtz Rubenstein for the years
ended February 29, 2004 or February 28, 2003.

PRE-APPROVAL POLICIES

         Our  Board  of  Directors  has not  adopted  any  blanket  pre-approval
policies.  Instead,  the Board will  specifically  pre-approve  the provision by
Holtz Rubenstein of all audit or non-audit services.

         Our Board of Directors  approved all of the services  provided by Holtz
Rubenstein and described in the preceding paragraphs.


                                       19
<PAGE>




                                                        UNITED STATES BASKETBALL
                                                                    LEAGUE, INC.


CONTENTS
================================================================================
YEARS ENDED FEBRUARY 29, 2004 AND FEBRUARY 28, 2003                     PAGES
--------------------------------------------------------------------------------


FINANCIAL STATEMENTS
  Independent Auditors' Report                                           F-1
  Consolidated Balance Sheet                                             F-2
  Consolidated Statements of Operations                                  F-3
  Consolidated Statement of Stockholders' Deficiency                     F-4
  Consolidated Statements of Cash Flows                                  F-5
  Notes to Consolidated Financial Statements                          F-6 - F-10


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

<PAGE>







INDEPENDENT AUDITORS' REPORT


Board of Directors
United States Basketball League, Inc.
Milford, Connecticut

We have  audited the  consolidated  balance  sheet of United  States  Basketball
League, Inc. as of February 29, 2004 and the related consolidated  statements of
operations, stockholders' deficiency and cash flows for the years ended February
29, 2004 and February 28, 2003. These consolidated  financial statements are the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and  perform  the  audits to  obtain  reasonable  assurance  about  whether  the
consolidated  financial statements are free of material  misstatement.  An audit
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the  consolidated  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 United  States
Basketball  League,  Inc.  as of  February  29,  2004  and  the  results  of its
operations and its cash flows for the years ended February 29, 2004 and February
28, 2003 in conformity  with  accounting  principles  generally  accepted in the
United States of America.

The accompanying  consolidated  financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 1 to the
consolidated   financial   statements,   the  Company's   recurring   cash  flow
deficiencies from operations, its inability to collect annual franchise fees and
its reliance on related party revenue transactions raise substantial doubt about
its  ability to  continue as a going  concern.  Management's  plans in regard to
these  matters  are  also  described  in  Note  1.  The  consolidated  financial
statements do not include any adjustments  that might result from the outcome of
this uncertainty.



/s/ Holtz Rubenstein & Co., LLP
Holtz Rubenstein & Co., LLP



Melville, New York
May 18, 2004


                                      F-1

<PAGE>

                                                        UNITED STATES BASKETBALL
                                                                    LEAGUE, INC.
<TABLE>
CONSOLIDATED BALANCE SHEET
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<CAPTION>
FEBRUARY 29, 2004
--------------------------------------------------------------------------------



ASSETS

                                                             <c>
Current Assets:
  Cash                                                                $  16,098
  Due from affiliate                                                    101,751
  Inventory                                                              17,147
  Prepaid expenses and other current assets                                 600
                                                                ----------------
Total Current Assets                                                    135,596

Property and Plant, net of accumulated
depreciation of $3,846                                                  273,154
                                                                ----------------

Total Assets                                                          $ 408,750
                                                                ================

LIABILITIES AND STOCKHOLDERS' DEFICIENCY

Current Liabilities:
  Accounts payable and accrued expenses                               $ 146,310
  Due to affiliates                                                     151,367
  Due to stockholders                                                   278,433
  Current portion of mortgage payable                                     8,746
                                                                ----------------
Total Current Liabilities                                               584,856
                                                                ----------------
Mortgage Payable                                                        102,895
                                                                ----------------
Note Payable                                                             50,000
                                                                ----------------
Commitments and Contingencies

Stockholders' Deficiency:
  Common stock, $0.01 par value, 30,000,000 shares
  authorized; 3,485,502 shares issued                                    34,855
  Preferred stock, $0.01 par value, 2,000,000 shares
  authorized; 1,105,679 shares issued and outstanding                    11,057
  Additional paid-in capital                                          2,627,192
  Deficit                                                            (2,959,651)
  Treasury stock, at cost; 39,975 shares                                (42,454)
                                                                ----------------

Total Stockholders' Deficiency                                         (329,001)
                                                                 ---------------
Total Liabilities and Stockholders' Deficiency                        $ 408,750
                                                                 ===============

</TABLE>





--------------------------------------------------------------------------------
See notes to consolidated financial statements.                              F-2





<PAGE>

                                                        UNITED STATES BASKETBALL
                                                                    LEAGUE, INC.
<TABLE>

CONSOLIDATED STATEMENTS OF OPERATIONS
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<CAPTION>

YEARS ENDED FEBRUARY 29, 2004 AND FEBRUARY 28, 2003      2004          2003
--------------------------------------------------------------------------------

                                                     <c>           <c>
Revenues:
  Initial franchise fees                                $  155,000    $ 250,000
  Continuing franchise fees                                275,007      275,695
  Advertising                                               95,000       86,000
  Other                                                     56,080       25,738
                                                         ----------------------
                                                           581,087      637,433
                                                         ----------------------
Operating Expenses:
  Consulting                                               236,022      216,716
  Team and post season festival expenses                         -       56,916
  Referee fees                                              54,100       89,858
  Salaries                                                  57,453       58,800
  Travel and promotion                                     211,406      155,827
  Depreciation                                               3,846        2,462
  Other                                                    126,980      104,857
                                                         -----------------------
                                                           689,807      685,436
                                                         -----------------------
Loss from Operations                                      (108,720)     (48,003)
                                                         -----------------------

Other Income (Expenses):
  Interest expense                                         (20,635)      (8,637)
  Interest income                                               74           94
                                                         -----------------------
                                                           (20,561)      (8,543)
                                                         -----------------------

Net Loss                                                  (129,281)   $ (56,546)
                                                         =======================

Net Loss Per Share                                      $    (0.04)   $   (0.02)
                                                         =======================

Weighted Average Number of Common Shares Outstanding     3,445,527     3,445,527
                                                         =======================

</TABLE>



--------------------------------------------------------------------------------
See notes to consolidated financial statements.                              F-3


<PAGE>
                                                        UNITED STATES BASKETBALL
                                                                    LEAGUE, INC.

<TABLE>

CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIENCY
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Years Ended February 29, 2004 and February 28, 2003
------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>

                                              Common Stock              Preferred Stock
                                              ------------              ---------------
                                            Shares                    Shares
                                         Outstanding    Amount     Outstanding   Amount
                                         -----------    ------     -----------   ------


                                     <c>           <c>         <c>          <c>
Balance, March 1, 2002                    3,485,502   $  34,855    1,105,679   $  11,057
Net Loss                                         --          --           --          --
                                         ----------  ----------   ----------   ---------
Balance, February 28, 2003                3,485,502      34,855    1,105,679      11,057
Net Loss                                         --          --          --           --
                                         ----------  ----------   ----------   ---------

Balance, February 29, 2004                3,485,502   $  34,855    1,105,679   $  11,057
                                         ==========  ===========  ===========  ==========
<CAPTION>

                                         Additional                                    Treasury        Total
                                           Paid-In                                      Stock      Stockholders'
                                           Captial          Deficit       Shares        Amount       Deficiency
                                           -------          -------       ------        ------       ----------



                                     <c>           <c>                <c>        <c>           <c>
Balance, March 1, 2002                  $ 2,627,192   $ (2,773,824)       39,975     $ (42,454)    $   (143,174)
Net Loss                                         --        (56,546)           --            --          (56,546)
                                         -----------------------------------------------------------------------
Balance, February 28, 2003                2,627,192     (2,830,370)       39,975       (42,454)        (199,720)
Net Loss                                         --       (129,281)           --            --         (129,281)
                                         -----------------------------------------------------------------------

Balance, February 29, 2004              $ 2,627,192  $  (2,959,651)       39,975    $  (42,454)    $   (329,001)
                                         =======================================================================


</TABLE>

--------------------------------------------------------------------------------
See notes to consolidated financial statements.                              F-4
<PAGE>
                                                        UNITED STATES BASKETBALL
                                                                    LEAGUE, INC.
<TABLE>

CONSOLIDATED STATEMENTS OF CASH FLOWS
----------------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------------
<CAPTION>

Years Ended February 29, 2004 and February 28, 2003                                          2004               2003
----------------------------------------------------------------------------------------------------------------------------


                                                                                     <c>                   <c>
Cash Flows from Operating Activities:
 Net loss                                                                                     $ (129,281)         $ (56,546)
                                                                                      --------------------------------------
 Adjustments to reconcile net loss to net cash
  used in operating activities:
   Depreciation                                                                                    3,846              2,462
   Increase) decrease in assets:
    Inventory                                                                                     16,470             (2,966)
    Prepaid expenses and other current assets                                                          -              4,700
   Increase (decrease) in liabilities:
    Accounts payable and accrued expenses                                                         65,656             14,413
                                                                                      --------------------------------------
  Total adjustments                                                                               85,972             18,609
                                                                                      --------------------------------------
Net Cash Used In Operating Activities                                                            (43,309)           (37,937)
                                                                                      --------------------------------------

Cash Flows from Financing Activities:
  Due (to) from affiliates                                                                        64,926             25,686
  Payments on mortgage                                                                            (6,030)                 -
  (Decrease) increase in stockholders' loans                                                        (357)             7,226
                                                                                      --------------------------------------
Net Cash Provided by Financing Activities                                                         58,539             32,912
                                                                                      --------------------------------------

Net Increase (Decrease) in Cash                                                                   15,230             (5,025)
Cash and Cash Equivalents, beginning of year                                                         868              5,893
                                                                                      --------------------------------------
Cash and Cash Equivalents, end of year                                                          $ 16,098              $ 868
                                                                                      ======================================

</TABLE>

--------------------------------------------------------------------------------
See notes to consolidated financial statements.                              F-5

<PAGE>


                                                        UNITED STATES BASKETBALL
                                                                    LEAGUE, INC.


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================
TWO YEARS ENDED FEBRUARY 29, 2004 AND FEBRUARY 28, 2003
--------------------------------------------------------------------------------


     1.  DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

         The United States Basketball League,  Inc.(the "USBL" or the "Company")
         operates a  professional  summer basketball  league through  franchises
         located in the eastern part of the United States.

         The  Company  has  incurred  an  accumulated  deficit of  approximately
         $2,960,000.  In  addition,  the  USBL's  reliance  on both  substantial
         non-cash  transactions  and related  parties  (Notes 6 and 7) create an
         uncertainty as to the USBL's ability to continue as a going concern.

         The Company is making efforts to raise equity  capital,  revitalize the
         league and market new  franchises,  however,  there can be no assurance
         that the USBL  will be  successful  in  accomplishing  its  objectives.
         Because of the uncertainties  surrounding the ability of the Company to
         continue its operations, there is substantial doubt about the Company's
         ability to  continue as a going  concern.  The  consolidated  financial
         statements  do not  include  any  adjustments  that might be  necessary
         should the USBL be unable to continue as a going concern.

     2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         PRINCIPLES OF CONSOLIDATION - The accompanying  consolidated  financial
         statements  include  the  accounts  of all  subsidiaries  in which  the
         Company  has  a  majority  voting  interest  or  voting  control.   All
         significant   intercompany   accounts   and   transactions   have  been
         eliminated.

         CASH AND CASH  EQUIVALENTS  - The Company  considers  all highly liquid
         debt  instruments  purchased with a maturity of three months or less to
         be cash and/or cash equivalents.

         INVENTORY  -  Inventory  consists  of USBL  trading  cards,  basketball
         uniforms,  sporting equipment and printed promotional material. Certain
         inventory was obtained  through  barter  transactions  whereby the USBL
         granted  suppliers  various   advertising  space  (print)  and  airtime
         (television) in return for the supplier's products.  These transactions
         were  accounted  for  based  upon the fair  values  of the  assets  and
         services involved in the transactions.

         DEPRECIATION EXPENSE - Depreciation is computed using the straight-line
         method over the  building's  estimated  useful life  (approximately  30
         years).

         REVENUE  RECOGNITION - The Company generally uses the accrual method of
         accounting  in  these  financial   statements.   However,  due  to  the
         uncertainty   of  collecting   royalty  and  franchise  fees  from  the
         franchisees,  the USBL  records  these  revenues  upon  receipt of cash
         consideration  paid  or the  performance  of  related  services  by the
         franchisee.  Franchise  fees  earned in  nonmonetary  transactions  are
         recorded  at the fair value of the  franchise  granted  or the  service
         received,  based on which value is more readily determinable.  Upon the
         granting of the franchise,  the Company has performed  essentially  all
         material  conditions  related to the sale.  The offering price of a new
         franchise at February 29, 2004 and February 28, 2003 was $300,000.

         The Company generates  advertising  revenue from fees for area signage,
         tickets,  and  program  and year book  advertising  space.  Advertising
         revenue  is  recognized  at the  time  the  advertising  space  is made
         available to the user.

         Fees  charged  to teams to allow them to  relocate  are  recognized  as
         revenue upon collection of the fee. Souvenir sales, which are generated
         on the  Company's  web site,  are recorded  upon shipment of the order.
         Essentially all orders are paid by credit card.

         INCOME TAXES - Deferred tax assets and liabilities are determined based
         on differences  between financial reporting and tax bases of assets and
         liabilities, and are measured using the enacted tax rates and laws that
         will be in effect when the  differences  are  expected  to  reverse.  A
         valuation  allowance has been fully provided for the deferred tax asset
         (approximating   $670,000)   resulting  from  the  net  operating  loss
         carryforward.

--------------------------------------------------------------------------------
                                                                             F-6

<PAGE>


                                                        UNITED STATES BASKETBALL
                                                                    LEAGUE, INC.


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================
TWO YEARS ENDED FEBRUARY 29, 2004 AND FEBRUARY 28, 2003
--------------------------------------------------------------------------------

         As  of  February  29,  2004,  a  net  operating  loss  carryforward  of
         approximately  $1,675,000  is  available  through  February 28, 2024 to
         offset future taxable income.

         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.

         ADVERTISING COSTS - Advertising costs are expensed as incurred and were
         approximately $63,000 and $56,000 for the years ended February 29, 2004
         and February  28, 2003,  respectively.  Advertising  costs  include the
         value of radio air time received as  consideration  for franchise fees.
         The value of this  advertising is based upon the standard  market price
         of air time available to third party entities.

         STOCK-BASED  COMPENSATION - The Company  applies APB Opinion No. 25 and
         related  interpretations in accounting for stock-based  compensation to
         employees. Stock compensation to non-employees is accounted for at fair
         value in  accordance  with FASB  Statement  No.  123,  "Accounting  for
         Stock-Based  Compensation"  ("SFAS 123"). No options were issued during
         2004 and 2003.

         EARNINGS (LOSS) PER SHARE - Statement of Financial Accounting Standards
         No. 128, "Earnings Per Share"("SFAS No. 128") establishes standards for
         computing and presenting  earnings (loss) per share (EPS). SFAS No. 128
         requires dual presentation of basic and diluted EPS. Basic EPS excludes
         dilution  and is computed by dividing  net income  available  to common
         stockholders   by  the  weighted   average   number  of  common  shares
         outstanding for the period. Diluted EPS reflects the potential dilution
         that  could  occur if stock  options  or  convertible  securities  were
         exercised or converted  into common stock.  Basic and dilutive EPS were
         equivalent  for all  periods  presented  as the effect of common  stock
         equivalents was antidilutive or immaterial.

         COMPREHENSIVE  INCOME - Other  comprehensive  income  (loss)  refers to
         revenues,  expenses,  gains and losses  that under  generally  accepted
         accounting  principles  are  included in  comprehensive  income but are
         excluded from net income (loss) as these amounts are recorded  directly
         as an  adjustment  to  stockholders'  equity.  Comprehensive  loss  was
         equivalent to net loss for all periods presented.

         REFEREE FEES - The Company's  principal  obligation under the franchise
         agreements is to provide referees for the league.

         RECENT  ACCOUNTING  PRONOUNCEMENTS  -  Effective  January 1, 2003,  the
         Company  adopted SFAS No. 146,  "Accounting  for Costs  Associated with
         Exit  or  Disposal   Activities."  SFAS  No.  146  addresses  financial
         accounting  and  reporting for costs  associated  with exit or disposal
         activities and nullifies  Emerging Issues Task Force ("EITF") Issue No.
         94-3, "Liability  Recognition for Certain Employee Termination Benefits
         and Other Costs to Exit an Activity  (including  Certain Costs Incurred
         in a Restructuring)". SFAS No. 146 requires that a liability for a cost
         associated  with an exit  or  disposal  plan  be  recognized  when  the
         liability  is  incurred.  Under SFAS No. 146, an exit or disposal  plan
         exists when the following criteria are met:

               Management,  having the authority to approve the action,  commits
               to a plan of termination.

               The plan  identifies  the number of employees  to be  terminated,
               their job  classifications or functions and their locations,  and
               the expected  completion  date.

               The  plan  establishes  the  terms  of the  benefit  arrangement,
               including   the  benefits  that   employees   will  receive  upon
               termination  (including  but not  limited to cash  payments),  in
               sufficient  detail to enable  employees to determine the type and
               amount of benefits  they will  receive if they are  involuntarily
               terminated.

               Actions  required  to  complete  the  plan  indicate  that  it is
               unlikely  that  significant  changes  to the plan will be made or
               that the plan will be withdrawn.
--------------------------------------------------------------------------------
                                                                             F-7
<PAGE>

                                                        UNITED STATES BASKETBALL
                                                                    LEAGUE, INC.


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================
TWO YEARS ENDED FEBRUARY 29, 2004 AND FEBRUARY 28, 2003
--------------------------------------------------------------------------------

         SFAS No. 146  establishes  that fair value is the objective for initial
         measurement of the liability.  In cases where employees are required to
         render  service  beyond  a  minimum  retention  period  until  they are
         terminated in order to receive  termination  benefits,  a liability for
         termination  benefits is  recognized  ratably  over the future  service
         period.  The adoption of SFAS No. 146 did not have a material impact on
         our financial statements.

         Effective  March 1, 2003,  the  Company  adopted  the  recognition  and
         measurement provisions of Financial Accounting Standards Board ("FASB")
         Interpretation No. 45 ("Interpretation  45"),  "Guarantor's  Accounting
         and  Disclosure   Requirements  for  Guarantees,   Including   Indirect
         Guarantees of Indebtedness of Others".  This interpretation  elaborates
         on the  disclosures  to be made by a  guarantor  in interim  and annual
         financial  statements about the obligations  under certain  guarantees.
         Interpretation  45 also  clarifies  that a  guarantor  is  required  to
         recognize,  at the  inception of a guarantee,  a liability for the fair
         value of the  obligation  undertaken  in  issuing  the  guarantee.  The
         initial  recognition  and  initial   measurement   provisions  of  this
         interpretation  are  applicable  on a  prospective  basis to guarantees
         issued or modified  after  December  31,  2002.  The  Company  does not
         currently  provide  significant  guarantees  on a routine  basis.  As a
         result,  this  interpretation  has not  had a  material  impact  on our
         financial statements.

         In December 2003, the FASB issued FASB  Interpretation  No. 46 (revised
         December  2003)  ("Interpretation  46"),   "Consolidation  of  Variable
         Interest  Entities".  Application of this interpretation is required in
         the  Company's  financial  statements  for the year ended  February 29,
         2004.   Interpretation  46  addresses  the  consolidation  of  business
         enterprises  to which  the usual  condition  (ownership  of a  majority
         voting interest) of consolidation  does not apply. This  interpretation
         focuses on controlling financial interests that may be achieved through
         arrangements that do not involve voting interests. It concludes that in
         the absence of clear  control  through  voting  interests,  a company's
         exposure  (variable  interest)  to the  economic  risks  and  potential
         rewards from the variable  interest  entity's assets and activities are
         the best evidence of control.  If an enterprise holds a majority of the
         variable  interests of an entity,  it would be  considered  the primary
         beneficiary.  The primary  beneficiary  is required to include  assets,
         liabilities  and the results of  operations  of the  variable  interest
         entity in its financial statements. The Company determined that it does
         not  have  any  arrangements  or  relationships  with   special-purpose
         entities.

     3.  PROPERTY AND PLANT

         Effective  May  31,  2003,  a  transaction  was   consummated   wherein
         Meisenheimer Captial, Inc. ("MCI"), the Company's majority shareholder,
         assigned all of the  outstanding  shares of  Meisenheimer  Capital Real
         Estate  Holdings,  Inc.  ("MCREH") to the Company in order to satisfy a
         certain   payable  due  from  MCI  to  the  Company.   The  assets  and
         (liabilities) of MCREH were recorded at their historical cost as of May
         31, 2003, and included the following:

<TABLE>

                                                             <c>
         Land                                                   $       121,253
         Building                                                       155,747
         Due From (to) Affiliates                                       173,500
         Mortgage Payable                                              (117,700)
         Note Payable                                                   (50,000)
         Other                                                           (4,300)
                                                              ------------------
         Net Assets Recorded                                     $       278,500
                                                              ==================
</TABLE>

         The  real  estate  has a fair  value  of  $440,000,  based  on a recent
         appraisal.  Depreciation expense was $3,846 for the year ended February
         29, 2004.

         The Company  leases a portion of its office  space to  unrelated  third
         parties on a  month-to-month  basis.  Rental income was $27,700 for the
         year ended February 29, 2004.


--------------------------------------------------------------------------------
                                                                             F-8
<PAGE>

                                                        UNITED STATES BASKETBALL
                                                                    LEAGUE, INC.


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================
TWO YEARS ENDED FEBRUARY 29, 2004 AND FEBRUARY 28, 2003
--------------------------------------------------------------------------------


     4.  MORTGAGE PAYABLE

         The  mortgage  bears  interest  at 7.06% per annum,  payable in monthly
         installments  of $1,362  through July 2008,  and provides for a balloon
         payment approximating $67,800 in August 2008.

         The mortgage is guaranteed by the Company's officers. Future maturities
         of the mortgage are as follows:

<TABLE>

         YEAR ENDING FEBRUARY 28,
         -----------------------------------------------------------------------
         
                                                             <c>
         2005                                                    $         8,700
         2006                                                              9,400
         2007                                                             10,100
         2008                                                             10,800
         2009                                                             72,500

</TABLE>

     5.  NOTE PAYABLE

         The note payable,  due to a member of the  Meisenheimer  family,  bears
         interest  at 6% per annum,  payable  annually,  with  principal  due on
         December 31, 2006.

     6.  RELATED PARTY TRANSACTIONS

         The Company has entered into the  following  transactions  with related
         parties:

         a.    The USBL's  president,  personally,  through  family  members and
               other  entities  controlled  by  the  family  (the  "Meisenheimer
               Group"),  controls  approximately  81% of the USBL's common stock
               and 100% of the Company's preferred stock.

         b.    As of February 29, 2004,  amounts due to stockholders,  including
               interest,  approximated  $278,000.  This amount includes loans of
               $144,000, bearing interest at 6% per annum.

         c.    Included in revenues  are amounts from  various  related  parties
               affiliated with the Meisenheimer Group approximating  $240,000 in
               2004 and $276,000 in 2003,  respectively.  These revenues include
               initial   franchise   fees,   continuing   franchise   fees,  and
               advertising fees.

         d.    Consulting  fees  included  $180,000  for  both the  years  ended
               February  29, 2004 and  February 28,  2003,  for  consulting  and
               management  services  provided  by  Meisenheimer   Capital,  Inc.
               ("MCI").

         e.    The Company  leased its office  space from  Meisenheimer  Capital
               Real Estate Holdings,  Inc. ("MCREH"), a wholly-owned  subsidiary
               of MCI,  until May 2003 (Note 3). Rent expense on this  operating
               lease  approximated  $7,500  and  $30,000  for  the  years  ended
               February 29, 2004 and February 28, 2003, respectively.

         f.    Amounts  included  in  due  to  affiliates  in  the  accompanying
               consolidated  balance sheet  represent  advances from and accrued
               charges due to members of the  Meisenheimer  Group.  Such amounts
               are non-interest bearing and have no specified due date.

--------------------------------------------------------------------------------
                                                                            F-9
<PAGE>

                                                        UNITED STATES BASKETBALL
                                                                    LEAGUE, INC.


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================
TWO YEARS ENDED FEBRUARY 29, 2004 AND FEBRUARY 28, 2003
--------------------------------------------------------------------------------


     7.  NON-CASH TRANSACTIONS

         The USBL entered into the following  non-cash  transactions  during the
         fiscal year ended February 29, 2004:

         o     The Company  received  $203,000 of consulting  fees,  promotional
               services,   and  expense  reimbursements  in  lieu  of  cash,  as
               consideration for franchise fees and advertising.

         The USBL entered into the following  non-cash  transactions  during the
         fiscal year ended February 28, 2003:

         o     The Company  received  $306,000 of consulting  fees,  promotional
               services,   and  expense  reimbursements  in  lieu  of  cash,  as
               consideration for franchise fees. In addition, advertising income
               includes  $50,000 related to a promotional  campaign with a major
               airline.

     8.  STOCKHOLDERS' EQUITY

         CAPITALIZATION   -  The  Company's   authorized   capital  consists  of
         30,000,000  shares of common  stock and  2,000,000  shares of preferred
         stock.  All stock has a $.01 par value.  Each share of common stock has
         one vote,  and each  share of  preferred  stock  has five  votes and is
         entitled to a 2% non-cumulative annual dividend.

         TREASURY  STOCK - The Company  has  acquired  39,975  shares of its own
         stock,  valued  at  approximately   $42,400,  in  order  to  facilitate
         compensatory  stock grants to  employees.  These shares are  considered
         treasury and have been valued at cost.

     9.  SUPPLEMENTARY CASH FLOW INFORMATION

         Cash paid for  interest was  approximately  $5,800 and $0 for the years
         ended February 29, 2004 and February 28, 2003, respectively.

    10.  FAIR VALUE OF FINANCIAL INSTRUMENTS

         It is  management's  belief that the carrying  amounts of the Company's
         financial  instruments  approximate  their fair value at  February  29,
         2004.

    11.  OTHER REVENUES

         Other revenues consist principally of rental income, souvenir sales and
         miscellaneous fees charged to team owners.



--------------------------------------------------------------------------------
                                                                            F-10
<PAGE>




                                   SIGNATURES

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

                                           UNITED STATES BASKETBALL LEAGUE, INC.

                                           /s/ Daniel T. Meisenheimer, III
                                           --------------------------
                                           Daniel T. Meisenheimer, III
                                           President

         In accordance  with 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.

NAME                                       CAPACITY                    DATE
----                                       --------                    ----


/s/ Daniel T. Meisenheimer, III
-------------------------
Daniel T. Meisenheimer, III        Director and President          June 16, 2004
                                   (principal executive officer)
/s/ Richard Meisenheimer
-------------------------
Richard Meisenheimer               Director and Chief Financial    June 16, 2004
                                   Officer (principal financial
                                   and accounting officer)




                                       20
<PAGE>









                                  EXHIBIT INDEX


*3(i) Certificate of Incorporation (May 29, 1984)

*3(i)a   Amended Certificate of Incorporation (Sept. 4, 1984)

*3(i)b   Amended Certificate of Incorporation (March 5, 1986)

*3(i)c   Amended Certificate of Incorporation (Feb. 19, 1987)

*3(i)d   Amended Certificate of Incorporation (June 30, 1995)

*3(i)e   Amended Certificate of Incorporation (January 12, 1996)

*3(i)f   Certificate of Renewal (June 23, 1995)

*3(i)g   Certificate of Renewal (May 22, 2000)

*3.9     By-Laws of USBL

*3.10    Amended By-Laws

+10.2    Standard Franchise Agreement of USBL

21       Subsidiaries

31.1     Certification of President (principal executive officer)

31.2     Certification of Chief Financial Officer (principal financial officer)

  32     Certification pursuant to 18  U.S.C. Section  1350 as  adopted pursuant
         to Section 906 of the Sarbanes-Oxley Act of 2002


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

*Filed  with Form 10SBA and  amendments  thereto.
+Filed  with Form  10-KSB for Fiscal Year ended February 28, 2001.




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