**UNITED
      STATES SECURITIES AND EXCHANGE COMMISSION**


**WASHINGTON,
      D. C. 20549**





**FORM
      10-QSB**





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





**FOR
      THE QUARTERLY PERIOD ENDED MARCH 31, 2002**





**Commission
      File Number 333-44393**





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





For
      the
      transition period from **__________________TO
      __________________**





**EUROPEAN
      MICRO HOLDINGS, INC.**


(Exact
      name of registrant as specified in charter)





**Nevada**
            **65-0803752**(State
                or other jurisdiction of incorporation or organization)
            (I.R.S.
                Employer I.D. No.)**450
                Fairway Drive, Suite 105, Deerfield Beach,
                Florida**
            **33441**(Address
                of principal executive offices)
            (Zip)**(954)
                596-0249**Issuer’s
                telephone number, including area code





Check
      whether the issuer (1) filed all reports required to be filed by Section 13
      or
      15 (d) of the Securities Exchange Act of 1934 during the past twelve 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
o   No
x





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act).


Yes
o  No
o





APPLICABLE
      ONLY TO ISSUERS INVOLVED IN BANKRUPTCY


PROCEEDINGS
      DURING THE PRECEDING FIVE YEARS





Check
      whether the registrant filed all documents and reports required to be filed
      by
      Sections 12, 13 or 15(d)of the Exchange Act subsequent to the distribution
      of
      securities under a plan confirmed by a court.  o Yes   o No





APPLICABLE
      ONLY TO CORPORATE ISSUERS:





Indicate
      the number of shares outstanding of each of the issuer’s classes of common
      stock, as of the latest practicable date: **As
      of [July 31, 2006], the Company had 5,029,667 shares of common stock issued
      and
      outstanding.**









Transitional
      Small Business Disclosure Format: Yes o No x





**PART
      I**




**Financial
      Information**




**Item** **1.** **Financial Statements.**




**Index
      to Condensed Consolidated Financial Statements**





Condensed
                Consolidated Statement of Net Assets in liquidation (Unaudited)as
                of March
                31, 2002 (Liquidation Basis)
            
            3Condensed
                Consolidated Statements of Changes in Net Assets (Unaudited) for
                the Three
                and Nine Months Ended March 31, 2002 (Liquidation Basis) and Condensed
                Consolidated Statements of Operations for the Three and Nine Months
                Ended
                March 31, 2001 (Going Concern Basis)
            
            4Condensed
                Consolidated Statements of Cash Flows (Unaudited) for the Three and
                Nine
                Months Ended March 31, 2002 (Liquidation Basis) and for the Three
                and Nine
                Months Ended March 31, 2001 (Going Concern Basis)
            
            5Notes
                to Condensed Consolidated Financial Statements (Unaudited)
            
            7


2


**European
      Micro Holdings, Inc. and Subsidiaries**


**Condensed
      Consolidated Statement of Net Assets in liquidation as of March 31,
      2002**


**(Liquidation
      Basis)**


(In
      thousands)


(Unaudited)


**March
                    31, 2002****ASSETS****ASSETS:**Cash
                
                $
                80Accounts
                    receivable, net
                
                
                236Inventories,
                    net
                
                
                56Prepaid
                    expenses
                
                
                12Income
                    taxes receivable
                
                
                780Other
                    assets
                
                
                2,307***TOTAL
                    ASSETS***
                
                $
                3,471**LIABILITIES****LIABILITIES:**Current
                    portion of long-term borrowings
                
                $
                1,229Accounts
                    payable
                
                
                121Accrued
                    expenses and other liabilities
                
                
                704Due
                    to related parties
                
                
                687***TOTAL
                    LIABILITIES***
                
                $
                2,741***COMMITMENT
                    AND CONTINGENCIES******NET
                    ASSETS IN LIQUIDATION (available to holders of Common
                    Stock)***
                
                $
                730





See
      accompanying notes to condensed consolidated financial statements.


3


**European
      Micro Holdings, Inc. and Subsidiaries**


**Condensed
      Consolidated Statements of Changes in Net Assets for the Three and Nine Months
      Ended March 31, 2002 (Liquidation Basis) and Condensed Consolidated Statements
      of Operations for the Three and Nine Months**


**Ended
      March 31, 2001 (Going Concern Basis)**


(In
      thousands, except share and per share data)


(Unaudited)





**Three
                Months Ended March 31,**
            
            **Nine
                Months Ended****March 31,****2002**
            
            **2001**
            
            **2002**
            
            **2001****SALES:**Net
                sales to unrelated parties
            
            $
            -
            
            $
            20,064
            
            $
            10,930
            
            $
            75,735Net
                sales to related parties
            
            
            -
            
            
            51
            
            
            -
            
            
            198Total
                net sales
            
            
            -
            
            
            20,115
            
            
            10,930
            
            
            75,933**COST
                OF GOODS SOLD:**Cost
                of goods sold to unrelated parties
            
            
            -
            
            
            (19,236
            )
            
            (9,555
            )
            
            (68,994
            )Cost
                of goods sold to related parties
            
            
            -
            
            
            (46
            )
            
            -
            
            
            (189
            )Total
                cost of goods sold
            
            
            -
            
            
            (19,282
            )
            
            (9,555
            )
            
            (69,183
            )**GROSS
                PROFIT**
            
            
            **-**
            
            
            **833**
            
            
            **1,375**
            
            
            **6,750****OPERATING
                EXPENSE:**Selling,
                general and administrative expenses
            
            
            (206
            )
            
            (2,712
            )
            
            (1,785
            )
            
            (8,191
            )**LOSS
                FROM OPERATIONS**
            
            
            **(206**
            **)**
            
            **(1,879**
            **)**
            
            **(410**
            **)**
            
            **(1,441**
            **)****OTHER
                INCOME (EXPENSE)**Interest
                expense, net
            
            
            (25
            )
            
            (279
            )
            
            (234
            )
            
            (835
            )Forgiveness
                of debt
            
            
            —
            
            
            —
            
            
            686
            
            
            —Loss
                on rescission of American Micro purchase
            
            
            —
            
            
            —
            
            
            (1,345
            )
            
            —**TOTAL
                OTHER INCOME (EXPENSE)**
            
            
            (25
            )
            
            (279
            )
            
            (893
            )
            
            (835
            )**LOSS
                BEFORE INCOME TAXES**
            
            
            **(231**
            **)**
            
            **(2,158**
            **)**
            
            **(1,303**
            **)**
            
            **(2,276**
            **)**Income
                tax expense
            
            
            -
            
            
            (359
            )
            
            (29
            )
            
            (463
            )**NET
                LOSS**
            
            
            **(231**
            **)**
            **$**
            **(2,517**
            **)**
            
            **(1,332**
            **)**
            **$**
            **(2,739**
            **)****NET
                ASSETS BEGINNING OF PERIOD**
            
            
            **981**
            
            
            
            
            
            **2,067****EFFECT
                OF FOREIGN EXCHANGE RATES**
            
            
            **(20**
            **)**
            
            
            
            
            **(5**
            **)****NET
                ASSETS IN LIQUIDATION**
            
            **$**
            **730**
            
            
            
            
            **$**
            **730**Net
                loss per share - basic and diluted
            
            
            
            
            $
            (0.50
            )
            
            
            
            $
            (0.55
            )Weighted
                average number of shares outstanding-basic
                and diluted
            
            
            
            
            
            5,003,639
            
            
            
            
            
            4,982,566




See
      accompanying notes to condensed consolidated financial
      statements.


4


**European
        Micro Holdings, Inc. and Subsidiaries**




**Condensed
      Consolidated Statements of Cash Flows**




(In
      thousands)


(Unaudited)




**Nine
                Months Ended March 31,****(Liquidation
                Basis)**
            
            **(Going
                Concern Basis)****2002**
            
            **2001****CASH
                FLOWS FROM OPERATING ACTIVITIES:**Net
                loss
            
            $
            (1,332
            )
            $
            (2,739
            )*Adjustments
                to reconcile net loss to net cash provided by operating
                activities*Depreciation
                and amortization
            
            
            —
            
            
            481Deferred
                income taxes
            
            
            —
            
            
            59Forgiveness
                of debt
            
            
            (686
            )
            
            —Loss
                on rescission of American Micro purchase
            
            
            1,345
            
            
            —Provision
                for note receivable impairment
            
            
            —
            
            
            252Compensation
                charge for non-employee stock options
            
            
            —
            
            
            122*Changes
                in assets and liabilities, net of effects from
                dispositions*Accounts
                receivable
            
            
            5,182
            
            
            3,914Inventories
            
            
            2,809
            
            
            1,943Prepaid
                expenses and other assets
            
            
            (260
            )
            
            (34
            )Income
                tax receivable
            
            
            (263
            )
            
            433Accounts
                payable
            
            
            (1,035
            )
            
            (1,075
            )Accrued
                expenses and other liabilities
            
            
            (354
            )
            
            (1,408
            )Due
                to related parties
            
            
            685
            
            
            (11
            )*Net
                cash provided by operating activities*
            
            
            6,091
            
            
            1,937**CASH
                FLOWS FROM INVESTING ACTIVITIES:**Purchases
                of property and equipment
            
            
            —
            
            
            (391
            )Sale
                of property and equipment
            
            
            256
            
            
            179*Net
                cash provided by (used in) investing activities*
            
            
            256
            
            
            (212
            )**CASH
                FLOWS FROM FINANCING ACTIVITIES:**Decrease
                in short-term borrowings, net
            
            
            (5,708
            )
            
            (2,252
            )Repayment
                of long-term borrowings
            
            
            (832
            )
            
            (477
            )Issuance
                of common stock, net
            
            
            —
            
            
            50Repayment
                of capital leases
            
            
            (92
            )
            
            129*Net
                cash used in financing activities*
            
            
            (6,632
            )
            
            (2,550
            )Net
                cash transferred in disposition
            
            
            (65
            )
            
            —Effect
                of foreign exchange rates
            
            
            (53
            )
            
            247**NET
                DECREASE IN CASH**
            
            
            (403
            )
            
            (578
            )Cash
                at beginning of period
            
            
            483
            
            
            1,222**CASH
                AT END OF PERIOD**
            
            $
            80
            
            $
            644




See
      accompanying notes to condensed consolidated financial statements .


5


**European
      Micro Holdings, Inc. and Subsidiaries**


**Condensed
      Consolidated Statements of Cash Flows**




(In
      thousands)


(Unaudited)





**Nine
                Months Ended March 31,****2002**
            
            **2001****Supplemental
                disclosure of cash flow information:**Cash
                paid for interest
            
            $
            234
            
            $
            835Cash
                paid for taxes
            
            $
            -
            
            $
            20**Supplemental
                schedule of non-cash investing and financing
                activities:**Goodwill
            
            
            
            
            $
            1,839Notes
                issued for consideration
            
            
            
            
            $
            (1,839
            )On
                September 1, 2001 the notes payable in the amount of $1,318,000 to
                the
                former American Micro shareholders were settled by transfer of all
                American Micro shares from European Micro Holdings to the former
                American
                Micro shareholders. The following represents the assets and liabilities
                transferred by the settlement of the notes payable.Book
                value of assets transferred
            
            $
            2,682Book
                value of liabilities transferred
            
            $
            1,337





See
      accompanying notes to condensed consolidated financial
      statements.


6


**EUROPEAN
      MICRO HOLDINGS, INC.**





**NOTES
      TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**


**As
      of March 31, 2002**


**(Unaudited)**




**1**  **Summary
      of Significant Accounting Policies**




**Interim
      Financial Statements**




The
      accompanying condensed consolidated interim financial statements have been
      prepared in accordance with generally accepted accounting principles
      (“ GAAP ”),
      and
      under the liquidation basis of accounting since July 1, 2001, and pursuant
      to
      the rules and regulations for reporting on Form 10-QSB. These financial
      statements have not been audited by independent public accountants but include
      all adjustments (consisting of normal recurring adjustments) which are, in
      the
      opinion of management, necessary for a fair presentation of the net assets,
      financial condition, results of operations and cash flows for such periods.
      However, these results are not necessarily indicative of results for any other
      interim period or for the full year. Accordingly, certain information and notes
      required by GAAP for complete financial statements are not included herein.
      The
      interim statements should be read in conjunction with the Company’s financial
      statements and notes thereto included in the Company’s 2001 Annual
      Report on Form 10-KSB.




**Principles
      of Consolidation**





The
      accompanying condensed consolidated financial statements include the accounts
      of
      the Company and its wholly owned subsidiaries. All significant intercompany
      balances and transactions have been eliminated in consolidation.




**Property
      & Equipment Held for Sale**





Prior
      to
      the adoption of the liquidation basis of accounting, property and equipment
      were
      recorded at cost. Property and equipment held under capital leases were stated
      at the present value of minimum lease payments at the inception of the related
      leases. Depreciation was calculated using the straight line method over their
      estimated useful lives as follows: Furniture, fixtures & equipment, 2-7
      years and motor vehicles and other, 4 years. Property and equipment held under
      capital leases and leasehold improvements to property under operating leases
      were amortized on a straight-line basis over the shorter of the lease term
      or
      estimated useful life of the assets. The cost of additions and betterments
      were
      capitalized, and repairs and maintenance costs were charged to operations in
      the
      period incurred. When depreciable assets were retired or sold, the cost and
      related allowances for depreciation were removed from the accounts and the
      gain
      or loss was recognized. The Company reviews long-lived assets and certain
      identifiable intangibles for impairment whenever events or changes in
      circumstances indicate that the carrying amount of an asset may not be
      recoverable. Based upon a comprehensive review of all liquidity circumstances
      and current market conditions, the Company determined that the value of certain
      property and equipment was impaired. As a result of this determination, for
      the
      year ended June 30, 2001, the Company abandoned, discarded and wrote-off
      $171,440 in property and equipment. The Company also wrote-down $422,123 in
      property and equipment to net realizable value. The total impairment of $593,563
      was included in operating expenses in the accompanying consolidated statement
      of
      operations for the year ended June 30, 2001. As a result of recording the
      write-off in the year ended June 30, 2001, no adjustments are needed to reflect
      the change to liquidation basis of accounting.




European
      Micro UK sold their last remaining property and equipment, their office
      building, effective March 31, 2002 for 1,510,000 pounds sterling ($2,143,000
      at
      March 31, 2002). Proceeds from the sale were held in escrow at March 31, 2002,
      and are reflected in other assets in the accompanying condensed consolidated
      statement of net assets in liquidation as of March 31, 2002. The proceeds were
      released from escrow on April 5, 2002, at which time the mortgage loan note
      secured by the office building plus accrued interest was paid in full in the
      amount of 1,102,000 pounds sterling ($1,564,000 at March 31, 2002). The
      remaining proceeds of 369,000 pounds sterling ($523,000 at March 31, 2002),
      after commissions and legal fees of 39,000 pounds sterling, were paid down
      on
      the related party note payable to Harry Shields.




**Depreciation
      and Amortization**




Depreciation
      expense was not recorded during the three-month and six-month periods ended
      December 31, 2001 because, in accordance with Statement of Financial Accounting
      Standards (“ SFAS ”)
      No.
      121, substantially all of the Company’s long-lived assets are deemed to be held
      for sale.


7




**EUROPEAN
      MICRO HOLDINGS, INC.**





**NOTES
      TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**


**As
      of March 31, 2002**


**(Unaudited)**


**Loss
      Per Common Share**




Loss
      per
      common share is presented for the three-month and nine-month periods ended
      March
      31, 2001 under the same captions: basic loss per common share and diluted loss
      per common share. Basic and diluted loss per common share is computed based
      on
      the weighted average shares outstanding, including contingently issuable shares
      for which all contingencies have been met, and excludes any potential dilution.
      Diluted earnings per share, if applicable, would reflect the potential dilution
      from the exercise or conversion of all dilutive securities into common stock
      based on the average market price of common shares outstanding during the
      period.




Since
      the
      adoption of the liquidation basis of accounting on July 1, 2001, loss per share
      was not computed as such amounts are not deemed to be meaningful.




**2**  **Liquidation**





The
      Company had suffered operating losses in fiscal 2000 and 2001. Ongoing legal
      costs associated with the litigation related to Big Blue Europe, (See Note
      8),
      the costs associated with the Company’s electronic commerce strategy, increases
      in general overhead costs, and increased interest expense due primarily to
      increased borrowings, coupled with decreasing sales volumes and gross profit
      margins, have negatively impacted operating results. These factors resulted
      in
      the noncompliance of the financial covenants of the Company’s loan agreements.
      Due to these operating results and the covenant violations, the lender on the
      American Micro and Nor'Easter lines of credit and the European Micro Holdings,
      Inc. term loan demanded repayment of the Nor'Easter line of credit before June
      15, 2001 and the American Micro line of credit and the European Micro Holdings
      term loan by August 15, 2001. As a result, during April 2001, the Company
      decided to cease operations at Nor’Easter and during June 2001, the Company
      decided to cease operations at Colchester. The Nor’Easter line of credit was
      repaid on June 15, 2001. The American Micro
      line of credit was repaid during May 2001. The European Micro Holdings term
      loan
      was repaid on August 21, 2001. See Notes 4 and 5 for details.




The
      contingent earn-out payment of the American Micro acquisition relating to two
      times the after tax earnings for calendar year 2000 of approximately $1,839,000
      was due to the former American Micro shareholders. As a result of financial
      restrictions imposed by the lender on the American Micro and Nor’Easter lines of
      credit, on February 20, 2001, the Company delivered two Secured Promissory
      Notes
      (“ Notes ”)
      to the
      former American Micro shareholders in the original amount of $823,712 each.
      The
      Notes called for monthly principal payments of $50,000, plus interest at 8%
      commencing April 1, 2001, subject to financial covenant restrictions. Each
      Note
      was due in full within (30) days of the satisfaction of the American Micro
      and
      Nor’Easter lines of credit. On July 15, 2001, the Company notified the former
      American Micro shareholders that it would be unable to meet its obligations
      under each Note. After the repayment of the American Micro and Nor’Easter lines
      of credit along with the repayment of the European Micro Holdings, Inc. term
      loan, the Company was no longer restricted from performing its obligations
      to
      the American Micro shareholders. On August 22, 2001 the former American Micro
      shareholders demanded full payment of the Notes. On September 1, 2001 the Notes
      to the former American Micro shareholders were settled by transfer of all
      American Micro shares from European Micro Holdings to the former American Micro
      shareholders. See
      Note
      3.




Another
      factor that negatively impacted the Company’s liquidity was the terms of the
      borrowing arrangements of European Micro UK. European Micro UK’s borrowing
      capacity was subject to termination by the lender at lender’s sole discretion
      and during August, 2001 the lender on the European Micro UK’s line of credit
      demanded repayment. European Micro UK was able to repay the line of credit
      with a loan from a significant shareholder. The balance of this loan as of
      March
      31, 2002 in the amount of $646,000 is included in due to related parties in
      the
      accompanying condensed consolidated statement of net assets in liquidation
      as of
      March 31, 2002. See Notes 4 and 6 for details.




Hence,
      with the complete termination of all lines of credit available to the Company,
      the closures of Nor’easter and Colchester and the loss of American Micro, the
      Company had no alternative but to proceed with a complete liquidation of all
      assets. On July 12, 2005, the Company declared a cash dividend in the aggregate
      amount of $200,000 on the issued and outstanding shares of Common Stock held
      by
      shareholders of record as of August 1, 2005. As
      of
      July 31, 2006, liquidation is almost complete with the only asset being cash
      in
      the approximate amount of $20,000.


8




**EUROPEAN
        MICRO HOLDINGS, INC.**
 
 **NOTES
        TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **As
        of March 31, 2002**
 **(Unaudited)**


**3**  **Goodwill**




On
      October 26, 1998, European Micro UK acquired all of the outstanding shares
      of
      capital stock of Sunbelt (UK) Limited (“ Sunbelt ”).
      The
      Sunbelt purchase price (settled in pounds sterling) was comprised of a
      guaranteed portion and two contingent earn-out payments. The guaranteed portion
      of the purchase price, which was based upon Sunbelt’s net book value at closing
      and a multiple of its fiscal year 1998 pre-tax earnings, was 940,000 pounds
      sterling. Of this guaranteed amount, approximately 360,000 pounds sterling
      was
      paid in cash at closing. The unpaid balance of the guaranteed consideration
      included a note payable to the former 40% Sunbelt shareholder in the amount
      of
      240,163 pounds sterling with terms to be repaid in November 2005, subject to
      early repayment at the option of the note holder at any time after June 1,
      1999.
      Such note payable was secured by a cash account of equal amount. The former
      40%
      Sunbelt shareholder exercised his repayment option during the 3rd quarter of
      fiscal year 2001. The portion of the second contingent earn-out payment related
      to the volume purchases from the Far-East of 129,758 pounds sterling has been
      paid by a cash payment in the amount of 112,966 pounds sterling to the former
      40% Sunbelt shareholder on November 20, 2000 and by the issuance of 37,754
      and
      32,993 shares of the Company's common stock to the former 60% Sunbelt
      shareholder on December 12, 2000 and on March 12, 2001. The Company had the
      option of paying amounts due to the former Sunbelt shareholders in common stock
      of European Micro Holdings, Inc. See
      Note
      8.




At
      June
      30, 2001 the goodwill from the Sunbelt transaction was considered to be 100%
      impaired and as such was written-off.




On
      November 12, 1998, European Micro UK acquired the assets of H&B Trading
      International BV (“ H&B ”).
      The
      acquisition of H&B was accounted for as a purchase. The base purchase price,
      subject to adjustment, of approximately 125,000 Dutch guilders exceeded the
      estimated value of net assets acquired by approximately 85,000 Dutch guilders.
      At June 30, 2001 the goodwill from the H&B transaction was considered to be
      100% impaired and as such was written-off.




The
      Company acquired American Surgical Supply Corp. of Florida d/b/a/ American
      Micro
      Computer Center (“ AMCC ”),
      in a
      merger on July 1, 1999. The transaction was structured as a merger of AMCC
      with
      and into the newly formed, wholly owned subsidiary of the Company. Upon
      consummation of the merger, the subsidiary’s name was changed to American Micro
      Computer Center, Inc. (“ American
      Micro ”).
      The
      purchase price for AMCC was equal to $1,131,000, plus an earn-out amount payable
      in cash or shares of the Company’s common stock (at the Company’s discretion)
      equal to two times the after-tax earnings of American Micro in calendar year
      1999 and two times the after-tax earnings of American Micro in calendar year
      2000. The portion of the purchase price paid at closing was funded through
      the
      Company’s working capital. In addition, the Company assumed all outstanding
      indebtedness of AMCC, including a shareholder loan in the approximate amount
      of
      $289,000. This loan was owed to the father of John B. Gallagher, the Company’s
      Co-President, Co-Chairman and significant shareholder. This note was repaid
      in
      full in November 1999.




The
      acquisition of AMCC was accounted for as a purchase. The base purchase price,
      inclusive of transaction costs, of approximately $1,315,000 exceeded the
      estimated fair market value of net assets acquired by approximately $817,000,
      which constitutes goodwill and which was amortized on a straight-line basis
      over
      20 years. The results of operations of American Micro, since acquisition, had
      been included in the accompanying consolidated financial statements. The
      contingent earn-out payment relating to two times the after tax earnings for
      calendar year 1999 of approximately $600,000 was paid in March 2000 and is
      reflected in goodwill, net. The contingent earn-out payment relating to two
      times the after tax earnings for calendar year 2000 of approximately $1,839,000
      was added to goodwill, net. The second earn-out payment was due in monthly
      principal payments of $50,000, plus interest at 8% commencing April 1, 2001,
      subject to financial covenant restrictions. This amount was secured by a pledge
      of the shares of common stock of American Micro held by the Company. On
      September 1, 2001 the notes payable to the former American Micro shareholders
      were settled by transfer of all American Micro shares from European Micro
      Holdings to the former American Micro shareholders, hence the goodwill from
      the
      American Micro transaction was considered to be 100% impaired and as such was
      written-off at June 30, 2001.




9




**EUROPEAN
        MICRO HOLDINGS, INC.**
 
 **NOTES
        TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **As
        of March 31, 2002**
 **(Unaudited)**
  The
        following unaudited pro forma consolidated results of operations are presented
        as if the transfer of the American Micro shares had been made at the beginning
        of fiscal 2001 ($ in thousands, except share data):





**Three
                Months**
              **Ended**
              **March
                31, 2001**
            
            **Nine
                Months Ended**
              **March
                31, 2001****Net
                sales**
            
            **$**
            **15,976**
            
            **$**
            **62,442****Net
                loss**
            
            
            **($2,601**
            **)**
            
            **($3,364**
            **)****Basic
                and diluted loss per share**
            
            
            **($0.52**
            **)**
            
            **($0.67**
            **)**







In
      the
      fourth quarter of fiscal 2001, the Company recorded an impairment loss of
      $4,387,000 representing the entire amount of goodwill from the acquisitions
      of
      AMCC, Sunbelt and H&B. The impairment loss was included in other income
      (expenses) in the consolidated statement of operations for the year ended June
      30, 2001.




**4**  **Short-term** **borrowings**




Short-term borrowings were completely repaid during the quarter ended December 31, 2001.
      Short-term borrowings represented borrowings secured by various accounts
      receivable of European Micro UK. Since the closure of European Micro UK during
      October, 2001, accounts receivable were collected and the corresponding
      borrowings were repaid.




European
      Micro UK had a bank line of credit (the “ European
      Micro UK Working Capital Facility ”)
      which
      was secured by a mortgage debenture on all the assets of European Micro UK
      and
      was subordinated to the receivable financing and the capital leases. The
      facility, which was subject to review in July each year, had been extended
      to
      September 2001 and was due on demand. Maximum borrowing capacity under this
      facility was 2.0 million pounds sterling. Interest was charged at 1.25% over
      the
      bank borrowing rate of
      5.25%
      at June 30, 2001. During
      August, 2001 the lender on the European Micro UK’s line of credit demanded
      repayment. European Micro UK was able to repay the line of credit with a loan
      from a significant shareholder. The
      balance of this loan as of March 31, 2002 in the amount of $646,000 is included
      in due to related parties in the accompanying condensed consolidated statement
      of net assets in liquidation as of March 31, 2002.




The
      Company also obtained two lines of credit on October 28, 1999, to finance
      operations based in the United States. American Micro and Nor’Easter each
      obtained a line of credit, secured by accounts receivable and inventory. Amounts
      available under each of the line of credit agreements were based upon eligible
      accounts receivable and inventory, up to a maximum borrowing amount of $1.5
      million for each agreement. Each of these lines of credit was to mature on
      October 28, 2000. As partial security for these loans, Messrs. Gallagher and
      Shields pledged to the lender a portion of their shares of common stock of
      the
      Company. In the event the Company defaulted on one or more of these loans,
      the
      lender may have foreclosed on all or a portion of the pledged securities. Such
      an event could have caused a change of control in the Company because Messrs.
      Gallagher and Shields together owned 71% of the Company’s outstanding common
      stock. The lines of credit agreements included certain financial and
      non-financial covenants and restrictions. The agreements also contained a
      provision whereby the lender could declare a default based on subjective
      criteria. As of June 30, 2000, the Company was not in compliance with certain
      of
      the financial covenants in the agreements.




On
      October 5, 2000, the Company received a waiver of the covenant violations for
      the June 30, 2000 reporting date for the American Micro and Nor’Easter lines of
      credit. The Company and the bank terminated the existing lines of credit and
      entered into a new borrowing arrangement whereby each of American Micro and
      Nor’Easter had a working capital line of credit equal to the lesser of (i) $1.5
      million or (ii) the sum of 85% of eligible accounts receivable, plus the lesser
      of 50% of eligible inventory or $750,000. Interest was paid monthly at a
      floating rate of 50 basis points over the bank’s base rate. The term of the new
      arrangements was for one year from the closing date. The new facilities also
      required the companies to maintain depository accounts at the bank, whose daily
      receipts were applied against outstanding borrowings under the lines of credit.
      The new facilities also placed certain restrictions on the companies’ ability to
      pay dividends and to make capital expenditures, among other things, and also
      included a provision whereby the lender could declare a default based on
      subjective criteria. Collateral under the new credit line facilities consisted
      of a first priority lien on all assets of American Micro and Nor’Easter. Messrs.
      Gallagher and Shields guaranteed the borrowings under these arrangements. Mr.
      Shields pledged personal assets as additional collateral and further agreed
      to
      maintain certain personal financial statement liquidity levels. These borrowings
      were cross-collateralized and cross-defaulted with borrowings under the $1.5
      million term loan to European Micro Holdings, Inc. discussed in
      Note
      5.




10


**EUROPEAN
        MICRO HOLDINGS, INC.**
 
 **NOTES
        TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **As
        of March 31, 2002**
 **(Unaudited)**




The
      Company was again not in compliance with the new loan agreement financial
      covenants during fiscal year 2001. The Company was not able to obtain waivers
      from these covenant violations existing at March 31, 2001 and June 30, 2001.
      Due
      to the poor operating results and the covenant violations, the lender on the
      American Micro and Nor'Easter lines of credit and the European Micro Holdings,
      Inc. term loan agreed to waive the covenant violations subject to the Nor'Easter
      line of credit being repaid before June 15, 2001 and the American Micro line
      of
      credit and the European Micro Holdings term loan being repaid by August 15,
      2001. The Nor’Easter line of credit was repaid on June 15, 2001. The American
      Micro line of credit was repaid during April 2001. The European Micro Holdings
      term loan was repaid on August 21, 2001. See
      Note
      5.




**5**  **Long-term** **borrowings**




Long-term borrowings consist of the following (in thousands):




**March
                31, 2002**Mortgage
                loan note
            
            $
            1,229Term
                Loan
            
            
            -Other
                long-term borrowings
            
            
            -$
            1,229Less
                current maturities of long-term borrowings
            
            
            (1,229
            )Total
                long-term borrowings
            
            $
            -




On
      July
      16, 1999, European Micro UK purchased the office building in which it had
      previously been leasing space for 1,705,000 pounds sterling ($2,419,000 at
      March
      31, 2002). The purchase price was financed in part by a mortgage loan note
      in
      the amount of 1,312,000 pounds sterling ($1,862,000 at March 31, 2002). This
      loan called for monthly payments of principal and interest in the amount of
      15,588 pounds sterling ($22,119 at March 31, 2002)and had a maturity date of
      July 2009. The mortgage loan note bore interest at a fixed rate of 7.6%. The
      mortgage loan note included certain financial and non-financial covenants and
      restrictions. The agreement also contained a provision whereby the lender could
      have declared a default based on subjective criteria. The financial covenants
      were measured using the financial results of European Micro UK as of each fiscal
      year end. Based upon European Micro UK’s fiscal year end operating results,
      European Micro UK was out of compliance with one of the covenant requirements
      at
      June 30, 2001 and December 31, 2001. The Company was not able to obtain a waiver
      of this non-compliance. Therefore, the total amount outstanding under the
      mortgage loan note was reflected in current maturities of long term borrowings
      at March 31, 2002. European Micro UK sold the office building effective March
      31, 2002 for 1,510,000 pounds sterling ($2,143,000 at March 31, 2002). Proceeds
      from the sale were held in escrow at March 31, 2002, and are reflected in other
      assets in the accompanying condensed consolidated statement of net assets in
      liquidation as of March 31, 2002. The proceeds were released from escrow on
      April 5, 2002, at which time the mortgage loan note secured by the office
      building plus accrued interest was paid in full in the amount of 1,102,000
      pounds sterling ($1,564,000 at March 31, 2002). The remaining proceeds of
      369,000 pounds sterling ($523,000 at March 31, 2002), after commissions and
      legal fees of 39,000 pounds sterling, were paid down on the related party note
      payable to Harry Shields.




The
      term
      loan was obtained by European Micro Holdings on October 28, 1999, in the amount
      of $1,500,000. The term loan was to be repaid with quarterly payments of
      $125,000 over three years. The term loan bore interest at the one-month LIBOR
      plus two and one-quarter percentage points (2.25%). The term loan was secured
      by
      substantially all of the assets of the Company. As partial security for this
      loan, Messrs. Gallagher and Shields pledged to the lender a portion of their
      shares of common stock of the Company. In addition, Mr. Shields pledged personal
      assets as additional collateral and further agreed to maintain certain personal
      financial statement liquidity levels. In the event the Company defaulted on
      this
      loan, the lender could foreclose on all or a portion of the pledged securities.
      Such an event could have caused a change of control in the Company because
      Messrs. Gallagher and Shields together own 71% of the Company’s outstanding
      common stock.




11


**EUROPEAN
        MICRO HOLDINGS, INC.**
 
 **NOTES
        TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **As
        of March 31, 2002**
 **(Unaudited)**




This
      term
      loan agreement was with the same lender as the Nor’Easter Micro and American
      Micro line of credit facilities discussed in Note
      4,
      and was
      cross-collateralized and cross-defaulted with these line of credit facilities.
      The agreement also contained a provision whereby the lender could declare a
      default based on subjective criteria. Further, the term loan credit agreement
      contained loan covenant requirements. The Company was not in compliance with
      certain financial covenants. This term loan was repaid in full on August 21,
      2001.




**6**  **Related
      party transactions**




Related
      party transactions are summarized as follows (in thousands):




**Three
                  months ended**
                **March
                  31,**
              
              **Nine
                  months ended**
                **March
                  31,****2002**
              
              **2001**
              
              **2002**
              
              **2001****Sales
                  to:**Technology
                  Express
              
              $
              -
              
              $
              93
              
              $
              -
              
              $
              147**Purchases
                  from:**Technology
                  Express
              
              $
              -
              
              $
              1,359
              
              $
              -
              
              $
              2,923




*Due
      from/to related parties*





a)
            No
                amounts were due from related parties at March 31,
                2002.





b)
            Due
                to related parties consists of a note payable to Harry Shields in
                the
                amount of $646,000 and accounts payable to Technology Express of
                $21,000
                and American Micro of $20,000.





*Nature
      of related party relationships*





The
      entities listed above were related to the company in the following
      manner :





**Technology
      Express**




Until
      1996, Technology Express was a full service authorized reseller of computers
      and
      related products based in Nashville, Tennessee, selling primarily to end-users.
      Technology Express was sold to Inacom Computers in 1996. Concurrently with
      the
      sale, Mr. Shields founded a new computer company with the name Technology
      Express. This company was a distributor of computer products. Harry D. Shields,
      who is Co-Chairman, Co-President, a Director and shareholder (owning 31% of
      the
      outstanding shares) of European Micro Holdings, Inc., was president of
      Technology Express and owned 100% of the outstanding shares of capital stock
      of
      that company. Jay Nash, who is Chief Financial Officer, Treasurer and Secretary
      of European Micro Holdings, Inc., had been an employee of Technology Express
      since 1992.




**Harry
      Shields**




Harry
      D.
      Shields is Co-Chairman, Co-President, a Director and shareholder (owning 31%
      of
      the outstanding shares) of European Micro Holdings, Inc.




**American
      Micro Computer Center**




American
      Micro Computer Center was a distributor of computer hardware based in Miami,
      Florida. John B. Gallagher who is Co-Chairman, Co-President, Director and
      shareholder (owning 39% of the outstanding shares) of European Micro Holdings,
      Inc., was the president of American Micro Computer Center and owns 50% of the
      outstanding shares of capital stock in that company.




*Facilities
      and equipment*





The
      Company utilized approximately 350 square feet of office space and certain
      equipment owned by Technology Express for which it was not charged a
      fee.




12


**EUROPEAN
        MICRO HOLDINGS, INC.**
 
 **NOTES
        TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **As
        of March 31, 2002**
 **(Unaudited)**




**7**  **Equity
      Line of Credit**




On
      August
      24, 2000, European Micro Holdings, Inc. entered into an Equity Line of Credit
      (the “ Equity
      Credit Line ”).
      The
      Company incurred costs of $217,000 to obtain and execute the Equity Credit
      Line.
      On December 20, 2000, the Company raised $50,000 by issuing 25,020 shares of
      common stock under the Equity Credit Line. The Company and the investor agreed
      to terminate the Equity Credit Line effective May 15, 2001. In connection with
      such termination, all outstanding warrants held by the investor and the
      placement agent were terminated. The Company agreed to issue the placement
      agent
      warrants to purchase 500,000 shares of common stock at $5.00 per share, which
      warrants become exercisable only if the closing bid price of such common stock
      is $4.00 per share or more for ten consecutive trading days. These warrants
      expired on August 23, 2005. Since the closing bid price of the common stock
      was
      never $4.00 for ten consecutive trading days, the warrants never became
      exercisable, and as such no expense was recognized.




**8**  **Commitments
      and Contingencies**





On
      November 12, 1999, a New York corporation, Big Blue Products, and its owners
      Jeffrey and Marie Alnwick (the “ Alnwicks ”),
      commenced an action individually and derivatively for the Dutch company, Big
      Blue Europe, against the Company and its founders and officers, John B.
      Gallagher and Harry D. Shields in the United States District Court, Eastern
      District of New York, Jeffrey Alnwick and Marie Alnwick v. European Micro
      Holdings, Inc., Eastern District of New York, Docket No. 99 CV 7380 (the
“ Alnwick
      Litigation ”).





The
      complaint alleged thirty-three causes of action. Plaintiffs claimed, in
      substance, that defendants breached oral and written agreements relating to
      the
      management, operation and funding of Big Blue Europe. Specifically, plaintiffs
      alleged that defendants breached the joint venture agreement by which Big Blue
      Europe was formed, a licensing agreement for use of the “Big Blue” service mark
      in Europe, a non-competition agreement preventing Big Blue Europe from operating
      in the United States and several capital contribution agreements. Plaintiffs
      also claimed that defendants breached their fiduciary duties to the Alnwicks,
      engaged in fraudulent acts, aided and abetted breaches of fiduciary duties
      by
      others, misappropriated trade secrets and interfered with the employment
      contract of Big Blue Europe’s managing director. The complaint seeked
      unspecified compensatory and punitive damages, as well as injunctive relief
      restraining defendants from acting in violation of the alleged
      agreements.





Defendants
      moved to dismiss the complaint principally on the basis of forum non-conveniens
      in favor of existing proceedings in the Netherlands (commenced by European
      Micro
      UK), where a Dutch court appointed an independent director to oversee operations
      of the company. Defendants argued that any dispute between the shareholders
      and
      directors of the Dutch company, Big Blue Europe, which operated pursuant to
      Dutch law, should be resolved by a Dutch court. The United States District
      Court
      for the Eastern District of New York dismissed 31 of the 33 claims brought
      against the Company on grounds of "forum non conveniens." The Court decided
      that
      it would be more appropriate that these claims be adjudicated in The
      Netherlands, under Dutch Law. The Judge had granted the Plaintiffs in the case
      (Jeffrey and Marie Alnwick and Big Blue Products) the option to proceed with
      the
      remaining two allegations in United States District Court. Plaintiffs requested
      that these two counts also be dismissed. On April 19, 2001, the Plaintiffs
      filed
      a notice of appeal. In October 2003, the Company and its affiliated defendants
      entered into a settlement agreement with the plaintiffs. In accordance with
      the
      agreement, all parties dismissed all actions and released all claims.





In
      January 2001, Nor’Easter sued Arlington Computer Products, Inc. (“ Arlington ”)
      in the
      Superior Court of Rockingham County, New Hampshire, for breach of an agreement
      to pay for the purchase of laptop computers. Nor’Easter subsequently sued
      Arlington in the Circuit Court of Lake County, Illinois, to enforce a judgment
      obtained in the New Hampshire Litigation. In addition, Arlington sued Nor’Easter
      in the United States District Court for the Northern District of Illinois for
      breach of an agreement to sell Compaq computer memory modules. Nor’Easter filed
      a third party complaint in the Federal Litigation against Origin Micro, Inc.
      (“ Origin ”)
      for
      breach of an agreement to sell Compaq computer memory modules.




13


**EUROPEAN
        MICRO HOLDINGS, INC.**
 
 **NOTES
        TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **As
        of March 31, 2002**
 **(Unaudited)**


In
      June
      2002, Nor’Easter and Arlington entered into a settlement agreement whereby on
      June 20, 2002, Arlington paid Nor’Easter the sum of $52,556 and both parties
      discontinued the litigation and released all claims against each other. In
      July
      2002, Nor’Easter and Origin entered into a settlement agreement whereby on July
      29, 2002, Origin paid Nor’Easter the sum of $49,000 and both parties
      discontinued the litigation and released all claims. These amounts are included
      in accounts receivable in the accompanying condensed consolidated statement
      of
      net assets in liquidation as of March 31, 2002.





In
      December 2001, a former shareholder of Sunbelt served a statutory demand upon
      European Micro Plc in the sum of 92,710 pounds sterling. This sum was
      subsequently reduced to 73,940 pounds sterling. On April 19, 2002 Judge Kershaw
      QC granted the European Micro Plc an injunction preventing the former
      shareholder from presenting a petition in this sum based upon the statutory
      demand. On July 31, 2002 the Court of Appeal dismissed European Micro Plc’s
      claim and ordered the costs to be paid. In August 2003, the debt plus costs
      and
      interest owed the former shareholder of Sunbelt was assigned to Harry Shields,
      a
      shareholder of European Micro Holdings, Inc., for the sum
      of
      107,000 pounds sterling, (approximately $151,833 at exchange rate on March
      31,
      2002). This amount is included in accrued expenses and other current liabilities
      in the accompanying condensed consolidated statement of net assets in
      liquidation as of March 31,
      2002.




**9**  **Subsequent
      Events**





In
      December 2001, a former shareholder of Sunbelt served a statutory demand upon
      European Micro Plc in the sum of 92,710 pounds sterling. This sum was
      subsequently reduced to 73,940 pounds sterling. On April 19, 2002 Judge Kershaw
      QC granted the European Micro Plc an injunction preventing the former
      shareholder from presenting a petition in this sum based upon the statutory
      demand. On July 31, 2002 the Court of Appeal dismissed European Micro Plc’s
      claim and ordered the costs to be paid. In August 2003, the debt plus costs
      and
      interest owed the former shareholder of Sunbelt, which is included in accrued
      expenses and other current liabilities, was assigned to Harry Shields, a
      shareholder of European Micro Holdings, Inc., for the sum of
      107,000 pounds sterling .




In
      June
      2002, Nor’Easter and Arlington entered into a settlement agreement whereby
      Arlington paid Nor’Easter the sum of $52,556 and both parties discontinued the
      litigation and released all claims against each other. In July 2002, Nor’Easter
      and Origin entered into a settlement agreement whereby Origin paid Nor’Easter
      the sum of $49,000 and both parties discontinued the litigation and released
      all
      claims. (See Note 12)




In
      October 2003, the Company and its affiliated defendants entered into a
      settlement agreement with Big Blue Products whereby the plaintiffs discontinued
      the litigation and released all claims against the defendants. The parties
      bore
      their own legal costs and expenses and exchanged mutual releases. (See Note
      12)




On
      July
      12, 2005, the Company declared a cash dividend in the aggregate amount of
      $200,000 on the issued and outstanding shares of Common Stock held by
      shareholders of record as of August 1, 2005. As
      of
      July 31, 2006, liquidation is almost complete with the only asset being cash
      in
      the approximate amount of $20,000.




14




**EUROPEAN
        MICRO HOLDINGS, INC.**


**Item** **2.**  **Management’s
      Discussion and Analysis of Financial Condition and Results of
      Operations.**




**Introductory
      Statements**




*Forward-Looking
      Statements and Associated Risks. This filing contains forward-looking
      statements, including statements regarding  European Micro Holdings, Inc.’s
      (“* *European
      Micro* *”
or
      the “* *Company* *”)
      projections on the amount and timing of liquidating distribution. In addition,
      when used in this filing, the words “believes,” “anticipates,” “intends,” “in
      anticipation of,” “expects,” and similar words are intended to identify certain
      forward-looking statements. These forward-looking statements are based largely
      on the Company’s expectations and are subject to a number of risks and
      uncertainties, many of which are beyond the Company’s control. Actual results
      could differ materially from these forward-looking statements. In light of
      these
      risks and uncertainties, there can be no assurance that the forward-looking
      statements contained in this filing will in fact occur. The Company does not
      undertake any obligation to publicly release the results of any revisions to
      these forward-looking statements that may be made to reflect any future events
      or circumstances.*




*Unless
      the context otherwise requires and except as otherwise specified, references
      herein to “European Micro” or the “Company” include European Micro Holdings,
      Inc. and its five wholly-owned subsidiaries, European Micro Plc, a company
      organized under the laws of the United Kingdom (“* *European
      Micro UK* *”),
      Nor’Easter Micro, Inc., a Nevada corporation (“* *Nor’Easter* *”),
      Colchester Enterprise Pte. Ltd., a company organized under the laws of Singapore
      (“* *Colchester* *),
      American Micro Computer Center, Inc., a Florida corporation (“* *American
      Micro* *”),
      Engenis.com Ltd., a company organized under the laws of the United Kingdom
      (“* *Engenis* *”),
      (collectively, the five wholly-owned subsidiaries are referred to as the
“* *Subsidiaries* *”).*




**Overview**




The
      Company was an independent distributor of microcomputer products, including
      personal computers, memory modules, disc drives and networking products, to
      customers mainly in Western Europe and to customers and related parties in
      the
      United States and Asia. The Company’s customers consisted of value-added
      resellers, corporate resellers, retailers, direct marketers and distributors.
      The Company generally did not sell to end-users. The Company monitored the
      geographic pricing strategies related to such products, currency fluctuations
      and product availability in an attempt to obtain inventory at favorable prices
      from other distributors, resellers and wholesalers.




As
      described in more detail below, during July, 2001 the management approved a
      plan
      for the liquidation and eventual sale or dissolution of the Company.
      Accordingly, we are engaged in an ongoing orderly liquidation of our
      assets.




European
      Micro Holdings, Inc. was organized under the laws of the State of Nevada in
      December 1997 and is the parent of European Micro UK and Nor’Easter. European
      Micro Holdings, Inc. was formerly the parent of Colchester, American Micro
      and
      Engenis. European Micro UK was organized under the laws of the United Kingdom
      in
      1991 to serve as an independent distributor of microcomputer products to
      customers mainly in Western Europe and to related parties in the United States.
      Nor’Easter was organized under the laws of the State of Nevada on
      December 26, 1997 to serve as an independent distributor of microcomputer
      products in the United States. Colchester was organized under the laws of
      Singapore in November 1998 to serve as an independent distributor of
      microcomputer products in Asia. American Micro was organized under the laws
      of
      the State of Florida on June 24, 1999 to acquire AMCC and to serve as an
      independent distributor of microcomputer products in the United States. Premier
      Pages, Ltd. was formed on January 28, 2000 and later changed their name to
      Engenis.com Ltd on June 23, 2000. Engenis.com Ltd. was formed under the laws
      of
      the United Kingdom to serve as a business-to-business electronic commerce
      trading company.




European
      Micro UK was formerly the parent of European Micro GmbH (“ European
      Micro Germany ”),
      Sunbelt and European Micro B.V. (“ European
      Micro Holland ”)
      and
      has a 50% joint venture interest in Big Blue Europe, B.V. (“ Big
      Blue Europe ”).
      European Micro Germany was organized under the laws of Germany in 1993 and
      operates as a sales office in Düsseldorf, Germany. As of August 2000, the
      Company closed the sales operations of European Micro Germany. Sunbelt was
      a
      company registered in England and Wales, which was established in 1992 and
      based
      in Wimbledon, England. Sunbelt operated as a distributor of microcomputer
      products to dealers, value-added resellers and mass merchants throughout Western
      Europe. Except for the distribution of its Nova brand products (which was
      discontinued effective January 2000), Sunbelt’s distribution operations were
      integrated with and into the operations of European Micro UK. European Micro
      Holland was organized under the laws of Holland in 1995, and operated as a
      sales
      office near Amsterdam, Holland. Big Blue Europe was organized under the laws
      of
      Holland in January 1997 and was a computer parts distributor with offices
      located near Amsterdam, Holland, selling primarily to computer maintenance
      companies. Big Blue Europe has no affiliation with International Business
      Machines Corporation.




15




EUROPEAN
      MICRO HOLDINGS,
      INC.




European
      Micro Holding’s headquarters are located at 450 Fairway Drive, Suite 105,
      Deerfield Beach, Florida 33441, and its telephone number is (954)
      596-0249.




**Results
      of Operations**




The
      following information should be read in conjunction with the condensed
      consolidated financial statements of the Company and the notes thereto appearing
      elsewhere in this filing.




Certain
      statements within this Item and throughout this filing and the documents
      incorporated herein are “forward-looking statements” as described in the “safe
      harbor” provision of the Private Securities Litigation Reform Act of 1995. These
      statements involve a number of risks and uncertainties and actual results could
      differ materially from those projected.




**Critical
      Accounting Estimates**





The
      Company’s only critical accounting estimate pertains to fair value measurement
      in applying the liquidation basis of accounting. Management’s estimate of fair
      value is based upon the actual amounts collected from the liquidation of the
      assets and liabilities. Management does not believe these estimates could
      significantly change in the future.




For
      the
      purpose of the following analysis, 2001 information is presented on the going
      concern basis.





**Three-Month
      Period Ended March 31, 2002 and 2001**




*Total
      Net Sales* .
      Total
      net sales decreased $20 million, or 100%, from $20 million in the three-month
      period ended March 31, 2001 to zero in the comparable period in 2002. The
      decrease in sales was a result of liquidity problems and closures of the
      Company’s operations. Nor’Easter’s operations were closed in April 2001.
      Colchester’s operations were closed during July 2001. In addition, American
      Micro was transferred back to its original shareholders on September 1, 2001,
      in
      settlement of notes payable. European Micro UK ceased operations in October
      2001. As a result of these closures and transfers, the Company ceased generating
      revenue during the first half of fiscal 2002.




*Gross
      Profit* .
      Gross
      profit decreased $833,000, or 100%, from $833,000 in the three-month period
      ended March 31, 2001, to zero in the comparable period in 2002. This decrease
      was primarily due to lower sales volume due to the closings of the Company’s
      operating subsidiaries.




*Operating
      Expenses.* Operating expenses as a percentage of total net sales is no longer relevant.
      Operating expenses decreased $2,506,000, from $2,712,000 in the three-month
      period ended March 31, 2001 to $206,000 in the comparable period in 2002. This
      decrease was attributable to the closures of the Company’s
      operations.




*Interest
      Expense* .
      Interest expense, net decreased by $254,000 from $279,000 in three-month period
      ended March 31, 2001 to $25,000 in the comparable period in 2002. This was
      attributable to a decrease in short-term borrowings and long-term borrowings
      due
      to loans being called by the lenders and repaid.




*Income
      Taxes* .
      The
      Company did not record a tax benefit or expense during the three-month period
      ended March 31, 2002.


16




**EUROPEAN
      MICRO HOLDINGS, INC.**


**Nine-Month
      Period Ended March 31, 2002 and 2001**




*Total
      Net Sales* .
      Total
      net sales decreased $64.8 million, or 85.6%, from $75.7 million in the
      nine-month period ended March 31, 2001 to $10.9 million in the comparable period
      in 2002. The decrease in sales was a result of liquidity problems and closures
      of the Company’s operations. Nor’Easter’s operations were closed in April 2001.
      Colchester’s operations were closed during July 2001. In addition, American
      Micro was transferred back to its original shareholders on September 1, 2001,
      in
      settlement of notes payable. European Micro UK ceased operations in October
      2001. As a result of these closures and transfers, the Company ceased generating
      revenue during the first half of fiscal 2002.




*Gross
      Profit* .
      Gross
      profit decreased $5.4 million, or 80.6%, from $6.7 million in the nine-month
      period ended March 31, 2001, to $1.4 million in the comparable period in 2002.
      This decrease was the related to the closures of the Company’s
      operations.




Gross
      margins increased by 3.7% from 8.9% in the nine-month period ended March 31,
      2001 to 12.6% in the comparable period in 2002. This increase was related to
      above normal margins obtained at American Micro during the two months, July
      and
      August 2001, in which American Micro results were included.




*Operating
      Expenses.* Operating expenses as a percentage of total net sales increased from 10.8%
      in
      the nine-month period ended March 31, 2001 to 16.3% in the comparable period
      in
      2002. This increase was attributable to the closures of the Company’s operations
      in which sales ended but some on going operating expenses
      continued.




*Interest
      Expense* .
      Interest expense decreased by $601,000 from $835,000 in nine-month period ended
      March 31, 2001 to $234,000 in the comparable period in 2002. This was
      attributable to a decrease in short-term borrowings and long-term borrowings
      due
      to loans being called by the lenders and repaid.




*Income
      Taxes* .
      The
      Company recorded tax expense of $29,000 related to the tax adjustments at
      European Micro UK, however the Company has not accrued a tax benefit for
      operating losses in the United States or Singapore as realization is not
      considered more likely than not.




**Seasonality**




The
      Company typically experienced variations in its total net sales and net income
      on a quarterly basis as a result of many factors. These included, but were
      not
      limited to, seasonal variations in demand for the products and services offered
      by the Company, the introduction of new hardware and software technologies
      and
      products offering improved features and functionality, the introduction of
      new
      products and services by the Company and its competitors, the loss or
      consolidation of a significant supplier or customer, changes in the level of
      operating expenses, inventory adjustments, product supply constraints,
      competitive conditions including pricing, interest rate fluctuations, the impact
      of acquisitions, currency fluctuations and general economic conditions.
      Historical operating results included a reduction in demand in Europe during
      the
      summer months.




**Liquidity
      and Capital Resources**




The
      Company’s primary cash requirements were for operating expenses, funding
      accounts receivable, the purchase of inventory to support operations, taking
      greater advantage of available cash discounts offered by certain of the
      Company’s suppliers for early payment, acquisitions and debt service. The
      Company had historically funded these cash requirements through a combination
      of
      loans, internally generated cash flow and the net proceeds of its initial public
      offering.




*General.* The
      Company had suffered operating losses in fiscal 2000 and 2001. Ongoing legal
      costs associated with the litigation related to Big Blue Europe, the costs
      associated with the Company’s electronic commerce strategy, increases in general
      overhead costs, and increased interest expense due primarily to increased
      borrowings, coupled with decreasing sales volumes and gross profit margins,
      negatively impacted operating results. These factors resulted in the
      noncompliance of the financial covenants of the Company’s loan agreements. Due
      to these operating results and the covenant violations, the lender on the
      American Micro and Nor'Easter lines of credit and the European Micro Holdings,
      Inc. term loan demanded repayment of the Nor'Easter line of credit before June
      15, 2001 and the American Micro line of credit and the European Micro Holdings
      term loan by August 15, 2001. As a result, during April 2001, the Company
      decided to cease operations at Nor’Easter and during June 2001, the Company
      decided to cease operation at Colchester. The Nor’Easter line of credit was
      repaid on June 15, 2001. The American Micro line of credit was repaid during
      May
      2001. The European Micro Holdings term loan was repaid on August 21, 2001.




17


**EUROPEAN
        MICRO HOLDINGS, INC.**




The
      contingent earn-out payment of the American Micro acquisition relating to two
      times the after tax earnings for calendar year 2000 of approximately $1,839,000
      was due to the former American Micro shareholders. As a result of financial
      restrictions imposed by the lender on the American Micro and Nor’Easter lines of
      credit, on February 20, 2001, the Company delivered two Secured Promissory
      Notes
      (“ Notes ”)
      to the
      former American Micro shareholders in the original amount of $823,712 each.
      The
      Notes called for monthly principal payments of $50,000, plus interest at 8%
      commencing April 1, 2001, subject to financial covenant restrictions. Each
      Note
      was due in full within (30) days of the satisfaction of the American Micro
      and
      Nor’Easter lines of credit. On July 15, 2001, the Company notified the former
      American Micro shareholders that it would be unable to meet its obligations
      under each Note. After the repayment of the American Micro and Nor’Easter lines
      of credit along with the repayment of the European Micro Holdings, Inc. term
      loan, the Company was no longer restricted from performing its obligations
      to
      the American Micro shareholders. On August 22, 2001 the former American Micro
      shareholders demanded full payment of the Notes. On September 1, 2001 the notes
      payable to the former American Micro shareholders were settled by transfer
      of
      all American Micro shares from European Micro Holdings to the former American
      Micro shareholders.




Another
      factor that negatively impacted the Company’s liquidity was the terms of the
      borrowing arrangements of European Micro UK. European Micro UK’s borrowing
      capacity was subject to termination by the lender at the lender’s sole
      discretion. During August, 2001 the lender on the European Micro UK’s line of
      credit demanded repayment. European Micro UK was able to repay the line of
      credit with a loan from a significant shareholder.




Hence,
      with the complete termination of all lines of credit available to the Company,
      the closures of Nor’easter and Colchester and the loss of American Micro, the
      Company had no alternative but to proceed with a complete liquidation of all
      assets. On July 12, 2005, the Company declared a cash dividend in the aggregate
      amount of $200,000 on the issued and outstanding shares of Common Stock held
      by
      shareholders of record as of August 1, 2005. As
      of
      July 31, 2006, liquidation is almost complete with the only asset being cash
      in
      the approximate amount of $20,000.




*Long-Term
      Capital.* The
      Company’s long-term capital needs were historically met from the sales of
      securities and long-term borrowings. Certain long-term funding was supplied
      to
      the Company in the form of capital lease agreements and term loans. The capital
      lease agreements were secured by vehicles owned by the Company. As of December
      31, 2001, all capital lease agreements had been cancelled or assumed by other
      entities.




On
      October 28, 1999, the Company obtained a $1.5 million term loan. The
      term loan agreement was with the same lender as the Nor’easter Micro and
      American Micro line of credit facilities discussed above. Further, the term
      loan
      credit agreement contained similar loan covenant requirements . The
      term
      loan was to be repaid with quarterly payments of $125,000 over three years.
      The
      term loan bore interest at the one-month LIBOR plus two and one-quarter
      percentage points (2.25%). Seven payments were made, bringing the balance down
      to $625,000 at June 30, 2001. The term loan was secured by substantially all
      of
      the assets of the Company. As partial security for this loan, Messrs. Gallagher
      and Shields pledged to the lender a portion of their shares of common stock
      of
      the Company. In addition, Mr. Shields pledged personal assets as additional
      collateral and further agreed to maintain certain personal financial statement
      liquidity levels. As described above, the Company was not in compliance with
      loan covenants for the June 30, 2001 reporting period. This term loan was
      repaid on August 21, 2001.




On
      July
      16, 1999, European Micro UK purchased the office building in which it had
      previously been leasing space for 1,705,000 pounds sterling ($2,466,000 at
      December 31, 2001). The purchase price was financed in part by a loan in the
      amount of 1,312,000 pounds sterling ($1,897,000 at December 31, 2001). This
      loan
      called for monthly payments of principal and interest in the amount of 15,588
      pounds sterling ($22,542 at December 31, 2001) and had a maturity date of July
      2009. The mortgage loan note bore interest at a fixed rate of 7.6%. The mortgage
      loan note included certain financial and non-financial covenants and
      restrictions. The agreement also contained a provision whereby the lender could
      have declared a default based on subjective criteria. The financial covenants
      were measured using the financial results of European Micro UK as of each fiscal
      year end. Based upon European Micro UK’s fiscal year end operating results,
      European Micro UK was out of compliance with one of the covenant requirements
      at
      June 30, 2001 and March 31, 2002. The Company was not able to obtain a waiver
      of
      this non-compliance. Therefore, the total amount outstanding under the mortgage
      loan note was reflected in current maturities of long term borrowings at March
      31, 2002. European Micro UK sold the office building effective March 31, 2002
      for 1,510,000 pounds sterling ($2,143,000 at March 31, 2002). Proceeds from
      the
      sale were held in escrow at March 31, 2002, and are reflected in other assets
      in
      the accompanying condensed consolidated statement of net assets in liquidation
      as of March 31, 2002. The proceeds were released from escrow on April 5, 2002,
      at which time the mortgage loan note secured by the office building plus accrued
      interest was paid in full in the amount of 1,102,000 pounds sterling ($1,564,000
      at March 31, 2002). The remaining proceeds of 369,000 pounds sterling ($523,000
      at March 31, 2002), after commissions and legal fees of 39,000 pounds sterling,
      were paid down on the related party note payable to Harry Shields.




18


**EUROPEAN
        MICRO HOLDINGS, INC.**




On
      August
      24, 2000, European Micro Holdings, Inc. entered into an Equity Line of Credit
      (the “ Equity
      Credit Line ”).
      The
      Company raised $50,000 by issuing 25,020 shares of common stock under the Equity
      Line of Credit. The Company and the investor agreed to terminate the Equity
      Credit Line effective May 15, 2001. In connection with such termination, all
      outstanding warrants held by the investor and the placement agent were
      terminated. The Company agreed to issue the placement agent warrants to purchase
      500,000 shares of common stock at $5.00 per share, which warrants become
      exercisable only if the closing bid price of such common stock is $4.00 per
      share or more for ten consecutive trading days. These warrants expired on August
      23, 2005. Since the closing bid price of the common stock was never $4.00 for
      ten consecutive trading days, the warrants never became exercisable, and as
      such
      no expense was recognized.





**Quantitative
      and Qualitative Disclosures About Market Risk.**




*Reporting
      Currency* .
      European Micro Holding’s, Nor’Easter’s and American Micro’s reporting and
      functional currency, as defined by Statement of Financial Accounting Standards
      No. 52, was the U.S. dollar. The functional currency of European Micro UK
      was the U.K. pound sterling and Colchester was the Singapore dollar. European
      Micro UK and Colchester translate into the reporting currency by measuring
      assets and liabilities using the exchange rates in effect at the balance sheet
      date and results of operations using the average exchange rates prevailing
      during the period.




*Hedging
      and Currency Management Activities* .
      The
      Company occasionally hedged to guard against currency fluctuations between
      the
      U.K. pound sterling and the U.S. dollar. **




**Item
      3. Controls and Procedures**





**(a)**  **Evaluation
      of Disclosure Controls and Procedures:**





The
      Company’s Co-Chief Executive Officers, after evaluating the effectiveness of the
      Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and
      15d-15(e) under the Exchange Act) as of the end of the period covered by this
      Report, have concluded that as of such date, the Company’s disclosure controls
      and procedures were adequate and effective to ensure that material information
      relating to the Company that is required to be disclosed by the Company in
      reports that it files or submits under the Exchange Act, is recorded, processed,
      summarized and reported within the time periods specified in the SEC rules
      and
      accumulated and communicated to the Company’s management, including its Co-Chief
      Executive Officers, to allow timely decisions regarding required
      disclosure.





**(b)**  **Changes
      in Internal Controls:**




In
      connection with the evaluation of the Company’s internal controls during the
      Company’s last fiscal quarter, the Company’s Co-Chief Executive Officers, have
      determined that there are no changes to the Company’s internal controls over
      financial reporting that have materially affected, or are reasonably likely
      to
      materially effect, the Company’s internal controls over financial
      reporting.




19




**EUROPEAN
        MICRO HOLDINGS, INC.**


**PART
      II**





**Item
      1.**  **Legal
      Proceedings** **.**




On
      November 12, 1999, Jeffrey and Marie Alnwick (the “ Alnwicks ”)
      and a
      New York corporation, Big Blue Products, commenced an action individually and
      derivatively for the Dutch company, Big Blue Europe, against the Company and
      its
      founders and officers, John B. Gallagher and Harry D. Shields in the United
      States District Court, Eastern District of New York, Jeffrey Alnwick and Marie
      Alnwick v. European Micro Holdings, Inc., Eastern District of New York, Docket
      No. 99 CV 7380 (the “ Alnwick
      Litigation ”).




In
      October 2003, the Company and its affiliated defendants entered into a
      settlement agreement whereby the plaintiffs discontinued the litigation and
      released all claims against the defendants. The parties bore their own legal
      costs and expenses and exchanged mutual releases.




In
      January 2001, Nor’Easter sued Arlington Computer Products, Inc. (“ Arlington ”)
      in the
      Superior Court of Rockingham County, New Hampshire, for breach of an agreement
      to pay for the purchase of laptop computers. Nor’Easter subsequently sued
      Arlington in the Circuit Court of Lake County, Illinois, to enforce a judgment
      obtained in the New Hampshire Litigation. In addition, Arlington sued Nor’Easter
      in the United States District Court for the Northern District of Illinois for
      breach of an agreement to sell Compaq computer memory modules. Nor’Easter filed
      a third party complaint in the Federal Litigation against Origin Micro, Inc.
      (“ Origin ”)
      for
      breach of an agreement to sell Compaq computer memory modules.




In
      June
      2002, Nor’Easter and Arlington entered into a settlement agreement whereby
      Arlington paid Nor’Easter the sum of $52,556 and both parties discontinued the
      litigation and released all claims against each other. In July 2002, Nor’Easter
      and Origin entered into a settlement agreement whereby Origin paid Nor’Easter
      the sum of $49,000 and both parties discontinued the litigation and released
      all
      claims.




In
      December 2001, a former shareholder of Sunbelt served a statutory demand upon
      European Micro Plc in the sum of 92,710 pounds sterling. This sum was
      subsequently reduced to 73,940 pounds sterling. On April 19, 2002 Judge Kershaw
      QC granted the European Micro Plc an injunction preventing the former
      shareholder from presenting a petition in this sum based upon the statutory
      demand. On July 31, 2002 the Court of Appeal dismissed European Micro Plc’s
      claim and ordered the costs to be paid. In August 2003, the debt plus costs
      and
      interest owed the former shareholder of Sunbelt was assigned to Harry Shields,
      a
      shareholder of European Micro Holdings, Inc., for the sum
      of
      107,000 pounds sterling.




**Item
      2.**  **Unregistered
      Sales of Equity Securities and Use of Proceeds** **.**




(a),
      (b),
      (c) and (d). None.




**Item
      3.**  **Defaults
      Upon Senior Securities** **.**




At
      March
      31, 2002, based upon European Micro UK’s fiscal year end operating results,
      European Micro UK was out of compliance with one of the covenant requirements
      of
      the mortgage loan note secured by their office building. The Company was not
      able to obtain a waiver of this non-compliance. Therefore, the total amount
      outstanding under the mortgage loan note was reflected in current maturities
      of
      long term borrowings at March 31, 2002. European Micro UK sold the office
      building effective March 31, 2002 for 1,510,000 pounds sterling ($2,143,000
      at
      March 31, 2002). Proceeds from the sale were held in escrow at March 31, 2002,
      and are reflected in other assets in the accompanying condensed consolidated
      statement of net assets in liquidation as of March 31, 2002. The proceeds were
      released from escrow on April 5, 2002, at which time the mortgage loan note
      secured by the office building plus accrued interest was paid in full in the
      amount of 1,102,000 pounds sterling ($1,564,000 at March 31, 2002). The
      remaining proceeds of 369,000 pounds sterling ($523,000 at March 31, 2002),
      after commissions and legal fees of 39,000 pounds sterling, were paid down
      on
      the related party note payable to Harry Shields.




**Item
      4.**  **Submission
      of Matters to a Vote of Security Holders** **.**




None




20




**EUROPEAN
        MICRO HOLDINGS, INC.**


**Item
      5.**  **Other
      Information** **.**




None




**Item
      6.**  **Exhibits** **.**




(a)  Exhibits.





**Exhibit
                No.**
            
            **Description**
            
            **Location**2.01
            
            Agreement
                for the Acquisition of Sunbelt (UK) Limited by European Micro Plc
                dated
                October 26, 1998
            
            Incorporated
                by reference as Exhibit 2.01 to the Company’s Quarterly Report on
                Form 10-QSB filed on November 13, 1998.2.02
            
            Merger
                Agreement re: AMCC dated June 29, 1999
            
            Incorporated
                by reference as Exhibit 2.02 to the Company’s Annual Report on Form 10-KSB
                filed on September 28, 1999.2.03
            
            Plan
                of 1999 Merger re: AMCC dated June 29, 1999
            
            Incorporated
                by reference as Exhibit 2.03 to the Company’s Annual Report on Form 10-KSB
                filed on September 28, 1999.2.04
            
            Articles
                of Merger re: AMCC dated June 29, 1999
            
            Incorporated
                by reference as Exhibit 2.04 to the Company’s Annual Report on Form 10-KSB
                filed on September 28, 1999.2.05
            
            Amendment
                to Merger Agreement re: AMCC dated October 2, 2000
            
            Incorporated
                by reference as Exhibit 2.05 to the Company’s Registration Statement on
                Form S-1 filed on October 27, 2000.3.01
            
            Articles
                of Incorporation
            
            Incorporated
                by reference as Exhibit No. 3.01 to the Company’s Registration Statement
                on Form S-1 filed on January 16, 1998.3.02
            
            Certificate
                of Amendment of Articles of Incorporation
            
            Incorporated
                by reference as Exhibit 3.02 to the Company’s Quarterly Report on Form
                10-QSB filed on May 13, 1998.3.03
            
            Bylaws
            
            Incorporated
                by reference as Exhibit No. 3.02 to the Company’s Registration Statement
                on Form S-1 filed on January 16, 1998.4.01
            
            Form
                of Stock Certificate
            
            Incorporated
                by reference as Exhibit No. 4.01 to the Company’s Registration Statement
                on Form S-1/A filed on March 6, 1998.4.02
            
            1998
                Stock Incentive Plan
            
            Incorporated
                by reference as Exhibit No. 4.02 to the Company’s Registration Statement
                on Form S-1 filed on January 16, 1998.4.03
            
            1998
                Stock Employee Stock Purchase Plan
            
            Incorporated
                by reference as Exhibit No. 4.03 to the Company’s Registration Statement
                on Form S-1 filed on January 16, 1998.4.04
            
            Form
                of Lock-up Agreement
            
            Incorporated
                by reference as Exhibit No. 4.04 to the Company’s Registration Statement
                on Form S-1/A filed on March 24, 1998.10.01
            
            Form
                of Advice of Borrowing Terms with National Westminster Bank
                Plc
            
            Incorporated
                by reference as Exhibit No. 10.01 to the Company’s Registration Statement
                on Form S-1/A filed on March 6,
                1998.




21




**Exhibit
                No.**
            
            **Description**
            
            **Location**


10.02
            
            Invoice
                Discounting Agreement with Lombard NatWest Discounting Limited, dated
                November 21, 1996
            
            Incorporated
                by reference as Exhibit No. 10.02 to the Company’s Registration Statement
                on Form S-1/A filed on March 6, 1998.10.03
            
            Commercial
                Credit Insurance, policy number 60322, with Hermes Kreditversicherungs-AG
                dated August 1, 1995
            
            Incorporated
                by reference as Exhibit No. 10.03 to the Company’s Registration Statement
                on Form S-1/A filed on March 6, 1998.10.04
            
            Commercial
                Credit Insurance, policy number 82692, with Hermes Kreditversicherungs-AG
                dated August 1, 1995
            
            Incorporated
                by reference as Exhibit No. 10.04 to the Company’s Registration Statement
                on Form S-1/A filed on March 6, 1998.10.05
            
            Consignment
                Agreement with European Micro Computer B.V., dated January
                1996
            
            Incorporated
                by reference as Exhibit No. 10.05 to the Company’s Registration Statement
                on Form S-1/A filed on March 6, 1998.10.06
            
            Stockholders’
                Cross-Purchase Agreement by and between Jeffrey Gerard Alnwick, Marie
                Alnwick, European Micro Plc and Big Blue Europe, B.V. dated August
                21,
                1997
            
            Incorporated
                by reference as Exhibit No. 10.07 to the Company’s Registration Statement
                on Form S-1/A filed on March 6, 1998.10.07
            
            Trusteed
                Stockholders Cross-Purchase Agreement by and between John B. Gallagher,
                Harry D. Shields, Thomas H. Minkoff, Trustee of the Gallagher Family
                Trust, Robert H. True and Stuart S. Southard, Trustees of the Henry
                Daniel
                Shields 1997 Irrevocable Educational Trust, European Micro Holdings,
                Inc.
                and SunTrust Bank, Nashville, N.A., as Trustee dated January 31,
                1998
            
            Incorporated
                by reference as Exhibit No. 10.08 to the Company’s Registration Statement
                on Form S-1/A filed on March 6, 1998.10.08
            
            Executive
                Employment Agreement between John B. Gallagher and European Micro
                Holdings, Inc. effective as of January 1, 1998
            
            Incorporated
                by reference as Exhibit No. 10.09 to the Company’s Registration Statement
                on Form S-1/A filed on March 6, 1998.10.09
            
            Executive
                Employment Agreement between Harry D. Shields and European Micro
                Holdings,
                Inc. effective as of January 1, 1998
            
            Incorporated
                by reference as Exhibit No. 10.10 to the Company’s Registration Statement
                on Form S-1/A filed on March 6, 1998.10.10
            
            Contract
                of Employment Agreement between Laurence Gilbert and European Micro
                UK
                dated March 14, 1998
            
            Incorporated
                by reference as Exhibit No. 10.11 to the Company’s Registration Statement
                on Form S-1/A filed on March 6, 1998.10.11
            
            Subscription
                Agreement by and between John B. Gallagher, Harry D. Shields, Thomas
                H.
                Minkoff, Trustee of the Gallagher Family Trust, Robert H. True and
                Stuart
                S. Southard, Trustees of the Henry Daniel Shields 1997 Irrevocable
                Educational Trust, European Micro Holdings, Inc. effective as of
                January
                31, 1998
            
            Incorporated
                by reference as Exhibit No. 10.13 to the Company’s Registration Statement
                on Form S-1/A filed on March 6, 1998.10.12
            
            Administrative
                Services Contract by and between European Micro Holdings, Inc. and
                European Micro Plc effective as of January 1, 1998
            
            Incorporated
                by reference as Exhibit No. 10.14 to the Company’s Registration Statement
                on Form S-1/A filed on March 6, 1998.10.13
            
            Escrow
                Agreement between European Micro Holdings, Inc., Tarpon Scurry
                Investments, Inc. and The Chase Manhattan dated as of March 24,
                1998
            
            Incorporated
                by reference as Exhibit No. 10.15 to the Company’s Registration Statement
                on Form S-1/A filed on March 6, 1998.10.14
            
            Form
                of Indemnification Agreements with officers and directors
            
            Incorporated
                by reference as Exhibit No. 10.16 to the Company’s Registration Statement
                on Form S-1/A filed on March 6,
                1998.




22




**Exhibit
                No.**
            
            **Description**
            
            **Location**


10.15
            
            Form
                of Transfer Agent Agreement with Chase Mellon Stockholder Services,
                L.L.C.
            
            Incorporated
                by reference as Exhibit No. 10.17 to the Company’s Registration Statement
                on Form S-1/A filed on March 6, 1998.10.16
            
            Form
                of Credit Agreement by and between European Micro UK and National
                Westminster Bank Plc
            
            Incorporated
                by reference as Exhibit No. 10.17 to the Company’s Annual Report on Form
                10-KSB filed on September 28, 1998.10.17
            
            Consulting
                Contract dated September 10, 1998 by and between European Micro Holdings,
                Inc. and The Equity Group
            
            Incorporated
                by reference as Exhibit 10.19 to the Company’s Quarterly Report on
                Form 10-QSB filed on November 13, 1998.10.18
            
            Employment
                Agreement dated July 1, 1999 between John B. Gallagher and American
                Micro
            
            Incorporated
                by reference as Exhibit 10.21 to the Company’s Annual Report on Form
                10-KSB filed on September 28, 1999.10.19
            
            Revolving
                Loan Agreement dated October 5, 2000 between American Micro and
                SouthTrust Bank re: Line of Credit to American Micro
            
            Incorporated
                by reference as Exhibit 10.19 to the Company’s Annual Report on Form
                10-KSB filed on October 11, 2000.10.20
            
            First
                Amendment to Loan Agreement dated October 5, 2000 among the Company,
                American Micro, Nor’Easter and SouthTrust Bank, N.A. re: Term Loan to the
                Company
            
            Incorporated
                by reference as Exhibit 10.20 to the Company’s Annual Report on Form
                10-KSB filed on October 11, 2000.10.21
            
            Revolving
                Loan Agreement dated October 5, 2000 between Nor’Easter and
                SouthTrust Bank re: Line of Credit to Nor’Easter
            
            Incorporated
                by reference as Exhibit 10.21 to the Company’s Annual Report on Form
                10-KSB filed on October 11, 2000.10.22
            
            Loan
                Agreement dated October 28, 1999 among the Company, American Micro,
                Nor’Easter and SouthTrust Bank, N.A. re: Term Loan to the
                Company
            
            Incorporated
                by reference as Exhibit 10.23 to the Company’s Quarterly Report on
                Form 10-QSB filed on November 15, 1999.10.23
            
            Security
                Agreement dated October 5, 2000 between Nor’Easter and SouthTrust
                Bank
            
            Incorporated
                by reference as Exhibit 10.23 to the Company’s Annual Report on Form
                10-KSB filed on October 11, 2000.10.24
            
            Security
                Agreement dated October 5, 2000 between American Micro and SouthTrust
                Bank
            
            Incorporated
                by reference as Exhibit 10.24 to the Company’s Annual Report on Form
                10-KSB filed on October 11, 2000.10.25
            
            Line
                of Credit Note given by Nor’Easter to SouthTrust Bank
            
            Incorporated
                by reference as Exhibit 10.25 to the Company’s Annual Report on Form
                10-KSB filed on October 11, 2000.10.26
            
            Line
                of Credit Note given by American Micro to SouthTrust Bank
            
            Incorporated
                by reference as Exhibit 10.26 to the Company’s Annual Report on Form
                10-KSB filed on October 11, 2000.10.27
            
            Unconditional
                Guaranty given by Harry Shields to SouthTrust Bank Re: American
                Micro
            
            Incorporated
                by reference as Exhibit 10.27 to the Company’s Annual Report on Form
                10-KSB filed on October 11, 2000.10.28
            
            Unconditional
                Guaranty given by John Gallagher to SouthTrust Bank Re: American
                Micro
            
            Incorporated
                by reference as Exhibit 10.28 to the Company’s Annual Report on Form
                10-KSB filed on October 11, 2000.10.29
            
            Amended
                and Restated Unlimited Guaranty Agreement dated October 5, 2000 between
                Harry Shields and SouthTrust Bank
            
            Incorporated
                by reference as Exhibit 10.29 to the Company’s Annual Report on Form
                10-KSB filed on October 11, 2000.




23




**Exhibit
                No.**
            
            **Description**
            
            **Location**


10.30
            
            Amended
                and Restated Unlimited Guaranty Agreement dated October 5, 2000 between
                John Gallagher and SouthTrust Bank
            
            Incorporated
                by reference as Exhibit 10.30 to the Company’s Annual Report on Form
                10-KSB filed on October 11, 2000.10.31
            
            Unconditional
                Guaranty given by John Gallagher to SouthTrust Bank Re:
                Nor’Easter
            
            Incorporated
                by reference as Exhibit 10.31 to the Company’s Annual Report on Form
                10-KSB filed on October 11, 2000.10.32
            
            Unconditional
                Guaranty given by Harry Shields to SouthTrust Bank Re:
                Nor’Easter
            
            Incorporated
                by reference as Exhibit 10.32 to the Company’s Annual Report on Form
                10-KSB filed on October 11, 2000.10.33
            
            Specific
                Agreement for the Provision of Professional Services dated as of
                March 17,
                2000 between the Company and Cap Gemini UK Plc
            
            Incorporated
                by reference as Exhibit 10.25 to the Company’s Quarterly Report on Form
                10-QSB filed on May 15, 2000.10.34
            
            Equity
                Line of Credit Agreement dated as of August 24, 2000, between the
                Company
                and Spinneret Financial System, Ltd.
            
            Incorporated
                by reference as Exhibit 10.34 to the Company’s Annual Report on Form
                10-KSB filed on October 11, 2000.10.35
            
            Registration
                Rights Agreement dated as of August 24, 2000, between the Company
                and
                Spinneret Financial System, Ltd.
            
            Incorporated
                by reference as Exhibit 10.35 to the Company’s Annual Report on Form
                10-KSB filed on October 11, 2000.10.36
            
            Warrant
                to Purchase Common Stock dated as of August 24, 2000, given by the
                Company
                to Spinneret Financial System, Ltd.
            
            Incorporated
                by reference as Exhibit 10.36 to the Company’s Annual Report on Form
                10-KSB filed on October 11, 2000.10.37
            
            Warrant
                to Purchase Common Stock dated as of August 24, 2000, given by the
                Company
                to the May Davis Group, Inc.
            
            Incorporated
                by reference as Exhibit 10.37 to the Company’s Annual Report on Form
                10-KSB filed on October 11, 2000.10.38
            
            Registration
                Rights Agreement dated as of August 24, 2000, between the Company
                and the
                May Davis Group, Inc.
            
            Incorporated
                by reference as Exhibit 10.38 to the Company’s Annual Report on Form
                10-KSB filed on October 11, 2000.10.39
            
            Placement
                Agent Agreement dated as of August 24, 2000, between the Company
                and the
                May Davis Group, Inc.
            
            Incorporated
                by reference as Exhibit 10.39 to the Company’s Annual Report on Form
                10-KSB filed on October 11, 2000.14.01
            
            Code
                of Ethics
            
            Incorporated
                by reference as Exhibit 14.01 to the Company’s Annual Report on Form
                10-KSB filed on October 12, 2006.




24




**EUROPEAN
      MICRO HOLDINGS, INC.**




**SIGNATURES**




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




Dated:
              October
              16,2006
            **EUROPEAN
                MICRO HOLDINGS, INC.**By:
            */s/ John
              B. Gallagher*John
                B. Gallagher, Co-President


By:
            */s/* *Harry
              D. Shields*Harry
                D. Shields, Co-President




25