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

                                   FORM 10-KSB

                                   (Mark One)

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

                 For the annual period ended September 30, 2003

                                       OR

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

           For the Transition period from ____________ to ____________

                         COMMISSION FILE NUMBER 0-27757

                              CASE FINANCIAL, INC.

             (Exact Name of registrant as specified in its charter)

            Delaware                                             33-0529299
---------------------------------                            -------------------
  (State or other jurisdiction                                (I.R.S. Employer
of incorporation or organization)                            Identification No.)

       15060 Ventura Boulevard, Suite 240, Sherman Oaks, California 91403
       ------------------------------------------------------------------
                    (Address of principal executive offices)

                                 (818) 728-9440
              ----------------------------------------------------
              (Registrant's telephone number, including area code)

          (Former name and former address if changed since last report)

         Securities registered under Section 12(g) of the Exchange Act:

                          common stock, $.001 par value
                          -----------------------------
                                (Title of class)

      Check whether the issuer (1) filed all reports required to be filed
by Section 13 or 15(d) of the Exchange Act during the past 12 months (or
for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90
days. |X| Yes |_| No

      Check if there is no disclosure of delinquent filers in response to Item
405 of Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. |_|

      State issuer's revenues for its most recent fiscal year. $527,908

      The aggregate market value of common stock held by non-affiliates was
approximately $ 1,532,566 based on the December 26, 2003 closing price of such
common stock.

      As of December 26, 2003 there were 15,561,108 shares of common stock
outstanding.

                    DOCUMENTS INCORPORATED BY REFERENCE: None

<PAGE>

                                TABLE OF CONTENTS

PART I

Item 1.   Description of Business.............................................

Item 2.   Description of Property.............................................

Item 3.   Legal Proceedings.................................................

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

PART II

Item 5.   Market for Common Equity , Related Stockholder Matters, and Small
          Business Issuer Purchases of Equity Securities....................

Item 6.   Management's Discussion and Analysis or Plan of Operation.........

Item 7.   Financial Statements..............................................

Item 8.   Changes in and Disagreements With Accountants on Accounting and
          Financial Disclosure .............................................

Item 8A.  Controls and Procedures ..........................................

PART III

Item 9.   Directors, and Executive Officers of the Registrant...............

Item 10.  Executive Compensation............................................

Item 11.  Security Ownership of Certain Beneficial Owners and Management and
          Related Stockholder Matters.......................................

Item 12.  Certain Relationships and Related Transactions....................

Item 13.  Exhibits and Reports on Form 8-K..................................

Signatures..................................................................

Exhibit Index...............................................................

Certifications

<PAGE>

                                     PART I

Item 1. Description of Business

General

      We were originally incorporated as Asia Web Holdings, Inc. ("Asia Web") on
August 26, 1983 in British Columbia, Canada. In September 1993, we domesticated
under Section 388 of the Delaware General Corporation Law. Since our
incorporation, we have been in several different businesses. On March 12, 2002,
we entered into a definitive Asset Purchase Agreement (the "Agreement") with
Case Financial, Inc., a private California corporation, wherein we purchased
certain assets and the entire business operations of Case Financial, Inc. and
its wholly owned subsidiary Case Financial Funding, Inc. (hereinafter referred
to as "Old CFI"), and Case Financial, LLC (a California Limited Liability
Company related through common ownership, and hereinafter referred to as "LLC")
(together hereinafter referred to as "Old Case"), for up to 9,475,000 shares of
our common stock, 5,000,000 of which were reserved for issuance to note holders
of Old Case at $0.50 per share for the 60 days following closing. We secured
over 51 percent approval from 19 of our shareholders. In addition, commencing
March 15, 2002, we began managing the liquidation of the existing portfolios of
Old Case pursuant to a Service Agreement entered into in connection with the
asset purchase transaction, for a management fee equal to 15 percent of the
gross amounts collected by us on behalf of Old CFI. Also, on March 15, 2002, Mr.
Michael Schaffer resigned as an officer and director, and Mr. Eric Alden, the
President of Old CFI, was appointed the new Chief Executive Officer and a
director of the Company. As of March 15, 2002, we assumed all future operations
of the Old Case business, including the hiring of Old CFI's 13 employees.

      The asset purchase transaction closed on May 24, 2002, at which time we
issued 3,100,000 shares of our common stock to Old CFI, including an investment
banking fee of 480,000 shares valued at $216,000, and exchanged 1,750,700 shares
of common stock for notes receivable from Old CFI in the face amount of $835,000
plus accrued interest of $40,350. These notes are unsecured, due on demand, bear
interest at 12% - 18% per annum, and are subordinate to $2,200,000 in secured
indebtedness of Old CFI. We also purchased 100% of the members' interest in LLC
for 150,000 common shares valued at $67,500 and $700,000 in 8% subordinated
promissory notes. At that date, the principal amount of investments in contracts
outstanding held by LLC and acquired by us was $471,460, net of a reserve for
contract losses of $117,865. The transaction has been accounted for as a reverse
acquisition.

      Lastly, all of our former directors resigned in favor of new directors,
and 1,825,000 common shares were approved for issuance to new management,
certain new directors and consultants.

      At the closing, management, shareholders and note holders of Old Case held
or had the right to receive an aggregate of 6,825,700 common shares representing
approximately 44% of our then outstanding common stock.

      In May, Asia Web changed its name to Case Financial, Inc. (hereinafter
referred to as the "Company" or "Case") and changed its fiscal year end to
September 30. The Company is carrying on the historical business of Old Case.

OVERVIEW

      We provide funding to law firms involved in personal injury litigation to
cover the costs of expert witnesses, accident reconstruction and other costs,
excluding legal fees, ordinarily incurred in prosecuting contingency litigation.

      Our advances, loans and payment assumption guarantees are typically
non-recourse obligations that are repaid to us along with success fees and
sometimes interest, only upon settlement or favorable adjudication of the
underlying case. In the event the case is abandoned, dismissed or adjudicated
not in favor of the plaintiff, the borrower or recipient of advance has no
obligation to repay our principal or fees, and our investment is lost. If we


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<PAGE>

have issued a payment assumption guaranty, we are unconditionally obligated to
pay the expert or legal service provider at conclusion of the case, irrespective
of outcome.

      Upon settlement or successful adjudication of the cases, we receive a
return of our principal plus a success fee (and interest in the case of loans)
based upon our assessment of the risk of the particular litigation made by us
prior to making the investment. We look at a number of factors in determining
whether to make the investment and what price to charge to adequately compensate
us for the risk we undertake. See the discussion below entitled "OPERATIONS -
Risk and Risk Management".

      We believe that our funding helps to "level the playing field" in the
legal process by providing plaintiff' attorneys with the working capital needed
to fund the cost of contingency litigation, which prevents plaintiffs from being
forced to prematurely settle potentially valuable claims at a substantial
discount.

      We seek to position ourselves as a value-added working partner for
plaintiff attorneys. We believe that our services fill an identified market need
by providing non-recourse funds for litigation expenses principally on personal
injury related cases. Our products and services benefit plaintiff attorneys by
providing access to working capital in addition to, or as a replacement for
full-recourse bank lines of credit needed to fund ever increasing litigation
expenses, thereby enabling the attorney to better prepare each claim, in which
they participate under their contingency fee agreement, for maximum settlement
value. Plaintiffs benefit by having access to capital for interim personal
needs, rather than being forced to settle prematurely for lack of financial
resources. Our advances and loans do not defray any attorney fees that may arise
in a successful litigation, as the lawyer always remains fully at risk with
respect to those contingent fees. In the case of funding provided to plaintiff's
counsel our principal and fee income has senior priority over all other debts
and fees of the case, meaning that our funding and fees are repaid prior to
participation by the lawyer and plaintiff in the award or settlement. In cases
where the settlement or award is substantially less than anticipated, we may be
forced to negotiate a lower fee or interest rate or may incur a loss of some of
our principal. We provide a reserve for losses and adjustments of this type.


                                       5
<PAGE>

      Recent Developments - Our Loan and Guaranty Programs

      In April 2003, we began to offer our L.E.G.s loan and guaranty program
through Case Capital Corporation, a registered finance company, to law firms
representing plaintiffs in personal injury cases. Under the L.E.G.s program, we
make non-recourse loans to or issue payment assumption guarantees on behalf of
lawyers to cover the fees of expert witnesses and other legal service providers
involved in prosecuting the contingency litigation on behalf of the plaintiff.
In the case of guarantees, we are obligated to make payment upon case
resolution. Like our traditional advances made prior to April 2003, these loans
and payment assumption guarantees are non-recourse to the borrower. We
underwrite them in the same way. While a majority of our revenues in the near
future will continue to be derived from resolutions of traditional cash advances
made prior to April 2003, our marketing focus is on the L.E.G.s loan and
guaranty program.

      The company under its wholly owned subsidiary, Case Capital Corporation,
initiated a new loan program for short term bridge loans for attorneys. The
loans are secured by settled cases and are expected to turn in less then 60 days
on average.

REVENUE GENERATION AND RECOGNITION

      The management of our advances, loans and guarantees are risk-based
investments in contracts subject to the uncertainty of future events in the
prosecution of the underlying litigation. We charge success fees (and interest
in the case of loans) which are recognized only at conclusion of the case, and
only if such litigation is successful. We base the prices we charge on our
underwriting and analyses of the risk, and additionally, in the case of advances
and loans, on the time value of money. In unsuccessful cases, we realize a loss
of the investment principal.

Contract Fees. There are two categories of Contract Fees: i) fees generated from
the resolution of successful cases funded entirely by us, and ii) fees generated
from the resolution of successful cases arranged and serviced by us, but funded
by third parties, referred to herein as "Third Party Investments."

      We utilize Third Party Investments in order to provide funding to our
clients in situations when our available internal capital is insufficient to
fund the transactions entirely by ourselves, or when the size of the transaction
is larger than is prudent for us to undertake directly. We receive a success fee
for originating and servicing the investment generally equal to 25% or 50% of
the income, if any, received upon successful resolution of the underlying case.
The third party investors bear all of the risk with respect to the investment in
contract. In addition, if we also participate in the funding, we share in the
remaining fees and principal with the third party investors according to our
pro-rata share of the total capital invested.

Service Fees. Service Fees consist of revenues we generate in connection with
our management of the investments in contracts portfolio of Old CFI under a
Service Agreement entered into in May 2002 as part of the reverse acquisition.
Old CFI has retained the underlying investments in these portfolios so our fees
are for servicing the investment portfolio during its liquidation. The service
fees we earn are equal to 15% of the gross amount collected (principal plus
contract fee income) on behalf of Old CFI.

                    Contract Fee   Service Fees
                    ------------   ------------
         2002         383,104        100,262
         2003         468,389         59,519


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<PAGE>

See the section entitled "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS -- RESULTS OF OPERATIONS" below.

INDUSTRY OVERVIEW

      Unlike attorneys who bill hourly for their legal services, plaintiff
attorneys in personal injury litigation work on a contingency basis and
routinely fund the cost of litigation themselves. Expert witnesses are essential
in the process of litigating a personal injury case, and can cost several
thousand dollars per expert per case. Accordingly, a plaintiff attorney's
ability to maximize the value of a case is based in part on their ability to
fund the case. In addition, plaintiff attorneys are often obligated to provide
funds to their clients for living and other expenses while awaiting settlement.
In order to satisfy their clients' needs, they may be forced to settle a
client's claim at a lesser amount, advance their own funds to clients without
the lawful ability to charge interest, or risk losing clients to other attorneys
who will advance funds.

CALIFORNIA PERSONAL INJURY MARKET

      We currently focus our efforts on the personal injury litigation market,
and limit our operations principally to state and federal litigation conducted
within the State of California. According to the 2003 Court Statistics Report,
Statewide Caseload Trends 1991-1992 through 2000-2002 by Judicial Council of
California and the 2003 California Verdict Survey (1997 - 2002) by Jury Verdict
Research, in 2002, there were 60,694 personal injury cases settled before trial
in California at an average value of $486,842, and 2,994 personal injury cases
resolved in the California courts at an average value of $918,218 resulting in a
total combined value of all awards and settlements of $32.3 billion. Because
these averages include a small number of very large value cases, we base our
market estimates instead on the median values as reported by those sources of
$60,000 for settlements and $65,000 for awards resulting in an annual market
estimate of $3.85 billion. Based upon our experience, out-of-pocket expenses for
experts and other legal service providers run approximately 10% of the case
value which, therefore, results in an annual available market opportunity of
$385 million for pre-settlement litigation funding in personal injury cases in
California. Currently, we estimate less than five percent 5% of this available
market is being served.

      According to the National Center for State Courts, the total number of
reported national civil filings for state trial courts in 2001 was approximately
21.3 million. During the decade 1989 to 1999, the Judicial Council of California
reported that an average of 70,000 personal injury cases were filed annually in
California Superior Courts and 1,800 personal injury cases went to jury trial.
This is an indication that less than 3% of personal injury cases actually go to
trial, the balance settled or resolved prior to trial. In the period from 2001
to 2002, the Judicial Council's 2003 Court Statistics Report estimated civil
case filings in California increased by 5% to 1.6 million. Personal injury,
property damage, and wrongful death filings increased by almost 9%, from 75,243
in 2001 to 81,787 in 2002. Civil case processing time also continued to improve
during the past year. These numbers exclude municipal court cases, as well as
insurance claims that are settled without the filing of a lawsuit.

STRATEGY

      Our objective is to become the pre-eminent institutional lender in
non-recourse pre-settlement litigation across the country. To achieve this
objective, the key elements of our strategy are as follows:

      o     Build awareness of our products and services within the California
            personal injury litigation market.

      o     Develop new products and services.

      o     Improve risk and portfolio management tools and guidelines.

      o     Improve our information technology infrastructure.


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<PAGE>

      o     Find new non-recourse lending opportunities within the California
            litigation market in segments other than personal injury litigation.

      o     Find new short term recourse lending opportunities within California
            litigation market.

      o     Find new opportunities for our lending business in personal injury
            and other litigation markets outside of California.

      In order to be successful we must continue to build awareness in the
California legal marketplace about our products and services, as well as
increase both the number of clients we service and the amounts we fund or
guaranty.

      The development of new products and services is a critical element of the
plan to grow our business. Our focus is to deliver new products which better
meet our customers' needs for reduced pricing. At the same time, our product
development efforts are directed towards reducing the overall investment risk in
our business, and thereby increasing our portfolio returns on investment and
profit margins.

      Our core competency is our ability to analyze the investment risk of the
underlying cases and make appropriate pricing and investment decisions. We have
proprietary case risk analysis procedures and investment guidelines which direct
our investment decision making. We will continue improving and refining our risk
analyses procedures, portfolio management guidelines and the type, quality and
data underlying them as we continue to grow our business.

      Our risk analysis capabilities are complemented by our technological
infrastructure and proprietary databases in which we capture and evaluate the
performance of each investment and draw upon in forming conclusions about
current investment decisions. Our plans to scale our business profitably are
dependent on this underlying infrastructure. As a result, we will continue to
devote resources to improving and upgrading our proprietary analysis and
reporting capabilities of our in-house computing platform.

      Although we believe the California personal injury market represents a
sizeable opportunity in itself, we nonetheless intend to explore new growth
opportunities in other segments of the litigation business in California that
may provide potential returns similar to those in personal injury litigation and
those in which our business model and business processes may be leveraged. As an
example, we have initially identified the construction defect litigation market
which we intend to study carefully in the near term.

      Expanding our Short Term Loan program to all areas of contingency law. We
intend to explore the possibility of expanding our short term loan into other
areas of contingency litigation.

      We also intend to investigate lending opportunities in personal injury and
other litigation markets in states outside of California with statutory and
regulatory environments, and litigation settlement statistics similar to those
in California.

SALES AND MARKETING

      We primarily market ourselves through affiliations with two of the three
professional associations for personal injury lawyers in California; Consumer
Attorneys of California, and the Consumer Attorneys of San Diego. These two
associations reach a majority of the 6,000-7,000 personal injury attorneys
practicing in the state. Our funding programs are currently endorsed by the San
Diego association to their membership, and we are an active participant in all
San Diego association programs. We are also an active participant in the
California association, which is the largest of the professional associations
and a continuing education program provider. In cooperation with the California
association, we have developed a program in Litigation Funding Alternatives
qualifying for continuing legal education credits. The program began in November
2002. We also exhibit at such associations' annual conventions. As a result of
these and other activities, our name is becoming better recognized and our
non-recourse funding products are becoming more accepted within the personal
injury legal community in California.


                                       8
<PAGE>

      We have a full time dedicated sales staff that is responsible for
developing and maintaining relationships with our personal injury attorneys and
law firm clients. The Sales staff is compensated primarily with a base salary
along with incentive payments tied to performance targets. An internal customer
service staff provides sales and marketing support to the District Managers,
Vice President of Sales and Marketing, and the underwriting department.

      The sales team directly markets our products to attorneys representing
plaintiffs in personal injury cases only where clear liability is established.
Presently, we have relationships with over 500 plaintiff attorneys in California
which serve as a referral base for new and increasing repeat business.

OPERATIONS

      Risk and Risk Management. We have developed a proprietary risk analysis
and case evaluation process with supporting information technology
infrastructure that permits our underwriting personnel to systematically and
objectively view of the claim through legal analysis, risk analysis, the nature
of the parties involved, and the underwriter's prior experience as to valuation
of similar claims. All factors relating to a claim are conservatively evaluated
in order to determine an independent and realistic range of projected settlement
value.

      Our underwriting department is managed by our Vice President of
Underwriting, an attorney licensed to practice in California, who has 10 years
of experience in personal injury litigation from both the plaintiff and
defendant insurance company perspective. Upon receipt of a case file, our
underwriting department makes an internal risk decision about whether to make an
investment on the claim to the plaintiff or to the law firm, and if so, in what
amount. The maximum investment is only a small percentage (generally less than
15%) of the expected future settlement value of the claim.

      We have developed a proprietary methodology for performing our
underwriting and risk analyses supporting our investment decision making and
pricing. These factors include a detailed analysis of documentation in
connection with the following:

      1.    the existence of clear liability
      2.    the extent of damages
      3.    an estimate of case costs, liens and valuation
      4.    time-to-resolution estimates
      5.    the attorney's prior verdict and settlement record on like cases
      6.    the plaintiff's litigation history

      We use these factors on a case-by-case basis to determine the amount of
the advance, loan or guaranty and our pricing. Once the case has been approved
by underwriting, the amount of the funding and its pricing are determined
according to a set of proprietary financial management metrics including various
caps and limitations which seek to maintain the stability of the portfolio. The
proposed investment is then reviewed and, if the amount exceeds $15,000,
approved by the Company's investment committee composed of the CEO, and the Vice
Presidents of Underwriting, Operations and Sales & Marketing.

      The risk department is currently capable of reviewing an average of 200
cases per month, or approximately 10 cases per day, which significantly exceeds
the current volume of activity. We approve approximately 50% of the cases we
review. As the volume of claims increase beyond this level, or if we enter other
markets, we intend to hire additional risk staff from experienced plaintiff
attorneys, insurance defense attorneys, and insurance adjustors.

      Technology Infrastructure. We utilize two primary in-house databases as
well as several subscription databases. The internally maintained databases
include a proprietary case management system for data collection, evaluation and
tracking; and an off-the-shelf case/investment tracking system that includes
customer resource management capability. The case management system collects
data from initial contact through case resolution.


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From these databases, we can generate an extensive range of reports. We utilize
these reports to refine case handling parameters and monitor the effectiveness
of our risk standards. The advance/tracking database facilitates the monitoring
and status updating of all open advances for purposes of collection.

WEBSITE AND TRADEMARKS

      We have developed a web presence and we have registered the domain name
CASEFINANCIAL.COM, among others. The website currently provides on-line access
to basic information about us and our products and services. We intend to expand
our web capabilities to include a wider array of customer service capabilities
in the near future.

      Additionally, we have a federal trademark for the service mark "The
Attorneys Advantage." We have trademark and servicemark applications pending for
"L.E.G.s,", and others.

CUSTOMERS

      As of September 30, 2003, one law firm customer represented approximately
25% of our portfolio of investments in contracts and approximately 23% of our
total revenue.

THIRD PARTY INVESTMENTS

      As of September 30, 2003, third party investments aggregated $2,236,080,
21% of which is from related parties. During the year ended September 30, 2003,
three related parties advanced $913,500 or 33% of the $2,776,580 total third
party investments and we returned $674,000 of the total third party investment
principal to those three related parties upon case resolution. In addition,
during that twelve month period, we paid $181,596 or 95% of the total third
party participation fees to those three related parties upon successful case
resolutions. Third party investors are completely at risk with respect to losses
on their investments. See "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS -- RESULTS OF OPERATIONS - REVENUE -
Contract Fees" and "CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS" below.

EMPLOYEES

      We currently have 10 full-time employees and 1 part-time employee. Our
employment agreements and their terms are described in our discussion entitled
"Directors, Executive Officers, Promoters and Control Persons - Employment
Agreements." None of our employees are covered by a collective bargaining
agreement, and we consider our relations with labor to be good.

COMPETITION

      The market for non-recourse pre-settlement litigation financing is
competitive but fragmented. We compete primarily on the basis of the flexibility
of our products, rapid response time, and the value added industry information
and business management services we provide.. In the California personal injury
litigation market, we face competition from the following companies: LitFunding
Corporation (currently in bankruptcy proceedings), Core Funding Group LP, Law
Finance Group Inc., Oasis Legal Funding, and ExpertFunding.com Corporation. We
may also face competition in the future from companies providing specialty
recourse financing to the legal community, including American Asset Finance LLC.
Some of our direct and indirect competitors are well-established national,
regional or local players that may have substantially greater financial,
marketing and other resources than we do. There are currently no competitors
offering non-recourse loans and guarantees similar to those offered by us in our
L.E.G.s program.

      Funding in our industry generally deals with pre-settlement litigation
funding (our market), post-litigation funding, and appellate funding. Should any
of our competitors conducting post-litigation and/or appellate funding


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move into the pre-settlement arena, we will face increased competition and may
need to refine our business model to meet the challenge, particularly if such
companies are better funded than we are.

GOVERNMENT REGULATION

      Advances. We are unaware of any state or federal regulations concerning
non-recourse advances in any of the states in which we currently do business, or
intend to do business in the foreseeable future.

      Loans. On April 8, 2003, our wholly owned subsidiary, Case Capital
Corporation, became licensed under the California Finance Lender's Law. As a
Licensed Finance Lender, Case Capital is subject to regulation by the California
Department of Corporations. Compliance costs include a fee equal to 0.0002 of
Case Capital's gross income from loans in California. Currently, we do not
believe that the compliance costs will be a material expense. Each state has
laws and regulations governing the business of lending money that may differ
from state to state. Therefore, prior to expanding our lending services into a
new jurisdiction we must conduct an extensive review of that state's regulatory
framework to ensure compliance with the applicable regulations.

      Guarantees. We are unaware of any state or federal regulations concerning
guarantees in any of the states in which we currently do business, or intend to
do business in the foreseeable future.

Item 2. Description of Property

      The Company subleases approximately 3,565 square feet of offices located
at 15060 Ventura Boulevard, Suite 240, Sherman Oaks, California, 91403. These
facilities are leased at a monthly rental of $6,774, expiring on September 30,
2004. The Company believes that the Sherman Oaks, California, facility will be
sufficient for its existing activities and near term growth. The facility is
well maintained and in good condition.

Item 3. Legal Proceedings

      Asia Web and some of its former officers and directors, Michael Schaffer,
Larry Schaffer and Waddy Stephenson, filed a complaint in the Superior Court of
the County of San Diego on January 16, 2002 against a law firm and several
individuals affiliated with the law firm. The law firm provided legal services
to Asia Web. The complaint sought damages of up to $1 million for legal
malpractice committed by the defendants. We settled the lawsuit in April 2003
and received a $216,000, net of direct litigation expenses, contingency attorney
fees, and $55,562 shared with Michael Schaffer.

      We are a nominal defendant in a shareholders' derivative action filed in
the Superior Court of the State of California for the County of San Diego. The
plaintiffs, as shareholders of Asia Web before the merger, have sued the
individual defendants former officers, including Michael Schaffer, alleging that
they converted to personal use certain corporate assets and are seeking to have
the individual defendants return the assets to us. We are only a "nominal"
defendant and no relief is being sought against us in this action. As a result
of the lawsuit, a dispute arose between us and a former officer, Michael
Schaffer, with respect to Mr. Schaffer's claim for indemnification for legal
fees incurred in defending himself in the lawsuit. We entered into a settlement
agreement with Mr. Schaffer on June 25, 2003 whereby we agreed to: (i) grant 18
month options to Mr. Schaffer to purchase 250,000 shares of common stock at an
exercise price of $0.30 only if the market price for our common stock exceeds
$0.65 for two consecutive trading days, and (ii) pay $70,000 in cash with
monthly payments of $10,000 commencing October 2003.


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

Not applicable.

                                     PART II

Item 5. Market for Common Equity , Related Stockholder Matters and Small Issuer
Purchases of Equity Securities.

      Our Common Stock is traded on the Over the Counter Bulletin Board (the
"OTC Bulletin Board") under the symbol "CSEF." Prior to June 4, 2002, the Common
Stock was traded on the OTC Bulletin Board under the symbol "AWHI." The
following table sets forth the high and low trade prices of the Common Stock for
the quarters indicated as quoted on the OTC Bulletin Board.

                                          2002                  2003
                                    ----------------      -----------------
                                     HIGH       LOW       HIGH        LOW
                                     ----       ---       ----        ---

      First Quarter                 $0.20      $0.11      $0.54      $0.30
      Second Quarter                $0.89      $0.13      $0.45      $0.20
      Third Quarter                 $0.75      $0.30      $0.30      $0.17
      Fourth Quarter                $0.78      $0.37      $0.32      $0.12

      As of December 26, 2003, there were approximately 433 holders of record of
Common Stock.

      We do not anticipate paying cash dividends on our Common Stock in the
foreseeable future. We currently intend to retain future earnings to finance our
operations and fund the growth of our business. Any payment of future dividends
will be at the discretion of the Board of Directors and will depend upon, among
other things, our earnings, financial condition, capital requirements, level of
indebtedness, contractual restrictions with respect to the payment of dividends
and other factors that the Board of Directors deems relevant.

Recent Sales of Unregistered Securities

      On December 12, 2002, we issued and sold one Unit to one institutional,
accredited investor for a total of $2 million. The Unit consisted of a
promissory note in the amount of $2 million bearing interest at the rate of 12%
per annum and warrants to purchase: (i) 2 million shares of common stock at an
exercise price of $0.50, and (ii) 1 million shares of common stock at an
exercise price of $0.80 per share. We paid a finder's fee in the amount of 10%,
or $200,000, payable in 3 annual installments as well as warrants to purchase
200,000 shares of common stock at an exercise price of $0.50 per share. The
finder's warrants expire four years from the date of grant. No forms of general
solicitation or advertising were used in connection with the sale and issuance
of the Unit. The issuance and sale of the Unit was exempt from the registration
provisions of the Securities Act of 1933, as amended, (the "Act") pursuant to
Section 4(2) thereof.

      On December 6, 2002, we issued and sold a $50,000 promissory note to one
accredited investor. The investor paid $50,000 in exchange for 3 year promissory
notes bearing interest at the rate of 9.85% per annum and 3 year warrants to
purchase 25,000 shares of common stock at an exercise price of $0.60 per share.
We did not


                                       12
<PAGE>

pay any placement agent fees or commissions in connection with the sale of the
promissory note. No forms of general solicitation or advertising were used in
connection with the sale and issuance of the promissory note. The issuance and
sale of the note was exempt from the registration provisions of the Act pursuant
to Section 4(2) thereof. On January 1, 2003, we changed the notes to four year
promissory notes bearing interest at the rate of 12% per annum and 4 year
warrants to purchase 50,000 shares of common stock at an exercise price of $0.50
and 25,000 shares of common stock at an exercise price of $0.80.

      From September 20, 2002 to December 5, 2002, we issued and sold a total of
$150,000 of promissory notes to one accredited investor. The investor paid
$150,000 in cash in exchange for 3 year promissory notes bearing interest at the
rate of 9.85% per annum and 3 year warrants to purchase 75,000 shares of common
stock at an exercise price of $0.60 per share. We paid a finder's fee of 5%, or
$7,500 to one individual. No forms of general solicitation or advertising were
used in connection with the sale and issuance of the promissory notes. The
issuance and sale of the notes was exempt from the registration provisions of
the Act pursuant to Section 4(2) thereof. On January 1, 2003, we changed the
notes to four year promissory notes bearing interest at the rate of 12% per
annum and four years warrants to purchase 150,000 shares of common stock at an
exercise price of $0.50 and 75,000 shares of common stock at an exercise price
of $0.80.

      From September 20, 2002 to December 5, 2002, the Company issued and sold a
total of $150,000 of promissory notes to one accredited investor. The investor
paid $150,000 in cash in exchange for 3 year promissory notes bearing interest
at the rate of 9.85% per annum and 3 year warrants to purchase 75,000 shares of
common stock of the Company at an exercise price of $0.60 per share. The Company
paid a finder's fee of 5%, or $7,500 to one individual. No forms of general
solicitation or advertising were used in connection with the sale and issuance
of the promissory notes. The issuance and sale of the notes was exempt from the
registration provisions of the Act pursuant to Section 4(2) thereof. On January
1, 2003 the Company changed the notes to a four year promissory notes bearing
interest at the rate of 12% per annum and four years warrents to purchase
150,000 shares of common stock of the Company at an exercise price of $0.50 and
75,000 shares of common stock of the Company at an exercise price of $0.80.


                                       13
<PAGE>

Equity Compensation Plan Information

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------
                                Number of securities to be   Weighted average
                                 issued upon exercise of     exercise price of     Number of securities
                                   outstanding options,     outstanding options,   remaining available
    Plan category                  warrants and rights      warrants and rights    for future issuance
-------------------------------------------------------------------------------------------------------
                                           (a)                     (b)                    (c)
-------------------------------------------------------------------------------------------------------
<S>                                      <C>                      <C>                      <C>
Equity compensation plans                       --                   --                     --
approved by security holders
-------------------------------------------------------------------------------------------------------
Equity compensation plans not            2,100,000                $0.45                    n/a
approved by security holders
-------------------------------------------------------------------------------------------------------
Total                                    2,100,000                $0.45                    n/a
-------------------------------------------------------------------------------------------------------
</TABLE>

Item 6. Management's Discussion and Analysis or Plan of Operation

      The following discussion and analysis of our financial condition and
results of operations should be read in conjunction with our financial
statements and the related notes thereto appearing elsewhere herein.

Forward Looking Statements

      The following "Management's Discussion and Analysis or Plan of Operation"
includes "forward looking statements." All statements other than statements of
historical fact made in this Form 10-KSB are forward-looking. In particular, any
statements made in this Form 10-KSB regarding industry prospects or our future
results of operations or financial position are forward-looking statements.
Forward-looking statements reflect our current expectations and are inherently
uncertain. The forward-looking statements contained herein are subject to a
variety of risks and uncertainties, including those discussed above under the
heading "Factors That May Affect Future Results" and elsewhere in this Quarterly
Report on Form 10-KSB that could cause actual results to differ materially from
those anticipated by us. Our actual results may differ significantly from our
expectations.

Overview

      Case Financial, Inc. was incorporated in the State of California in 1998
and took over the net assets, primarily cash, of Asia Web Holdings, Inc. ("Asia
Web") by way of a reverse acquisition completed on May 24, 2002.

      We provide non-recourse pre-settlement litigation funding services and
make interest-bearing short-term collateralized loans to plaintiff attorneys and
formerly to plaintiffs involved in personal injury and other contingency
lawsuits.

      From our inception in 1998 through April 2003, our investments had been
made in the form of cash advances. In April 2003 we formed our wholly owned
subsidiary Case Capital Corporation, a licensed California finance lender, and
subsequent to that date, our investments are made in the form of loans or
guarantees. Our advances, loans and guarantees are primarily "non-recourse,"
meaning: i) that the obligation to repay the principal amount (as well as any
success fees or interest) arises only upon settlement of the underlying
litigation, or upon its successful adjudication in court, and ii) that (except
in the case of loans made after April 2003 which become recourse obligations
upon the successful resolution of a case) we cannot otherwise pursue the assets
of the plaintiff or plaintiff's counsel outside of the litigation we're funding.
If the case is abandoned, dismissed or adjudicates unfavorably to the plaintiff,
our investment is lost. We are also making traditional recourse interest bearing
loans to plaintiff attorneys or law firms on a secured or unsecured basis.

      We classify our non-recourse advances, non-recourse loans and guarantees
on our balance sheet as "investments in contracts" to reflect their nature as
risk-based investments where the return of principal and fees


                                       14
<PAGE>

are subject to the uncertainty of future events in the prosecution of the
litigation. The investments in contracts are reflected on our financial
statements at the principal amount of the advance less a reserve for future
contract losses. We recognize income at the time of settlement or favorable
adjudication of the case.

      We classify our short term loans on our balance sheet as "Loans
receivable" to reflect the lower risk nature of the loans compared to our
non-recourse loans.

Our funding decisions are made on basis of a formal underwriting and risk
analysis we perform internally as to the merits of each case proposed to be
financed, the likelihood of its success, and its estimated settlement value; and
not on the credit worthiness of the plaintiff or plaintiff's lawyer. Our
decision to invest, as well as the price we charge is determined by this risk
analysis. Our success fees are a function of i) the risk, ii) the amount of
funding provided, and iii) in the case of advances or loans, the period of time
the advance or loan remains outstanding. Our investments and fees are
collateralized by the proceeds of the respective legal settlement evidenced by a
security interest on the case filed with the attorney of record on the claim,
entitling us to a priority interest on any monies received by the plaintiff or
plaintiff's counsel.

      Historically, approximately 80% of our fundings were to attorneys, while
the remaining portion was made directly to plaintiffs. In October 2002, we
formed a 100% owned subsidiary Case Capital Corporation which became a licensed
California finance lender in April 2003. Currently, we focus on providing
fundings only to plaintiffs' counsel, and only in the form of either loans or
payment assumption guarantees of the fees for experts, legal services providers
and other litigation costs. We refer to these new loans and guarantees as our
Litigation Expense Guaranty (L.E.G.s(TM)) program. We continue to employ our
historical underwriting and internal risk analyses in determining the individual
case funding amounts and pricing under the L.E.G.s program, focusing on the
individual merits, risk, estimated settlement value and timing of each case
proposed to be financed. We formed Case Capital Corporation, registered it as a
licensed California finance lender, and created the L.E.G.s program in order to
reduce some of the risk inherent in our business, better leverage our capital,
and add value for our shareholders. While a majority of our revenues in the near
future will continue to be derived from resolutions of traditional cash advances
made prior to April 2003, our marketing focus is on the L.E.G.s loan and
guaranty program.

      Attorneys use our funds or payment assumption guarantees primarily to pay
litigation costs, including expert witness fees, accident reconstruction costs,
filing fees, and other costs ordinarily incurred in prosecuting personal injury
cases. These expenditures are necessary to maximize settlement or trial values.
Our funding helps to "level the playing field" in the legal process against the
insurance carriers by providing plaintiff attorneys with the working capital to
fund the cost of contingency litigation, which prevents plaintiffs from being
forced to prematurely settle potentially valuable claims at a substantial
discount.

      Through May 24, 2002, the combined financial statements include the
accounts of Case Financial, Inc., its wholly owned subsidiary, Case Financial
Funding, Inc., and Case Financial LLC, a company related through common
ownership ("Old Case"). Prior to the merger, Case Financial, Inc. is referred to
as "Old CFI." The accompanying financial statements also include the accounts of
Case Financial Inc. and our wholly owned subsidiaries Case Financial, LLC and
Case Capital Corporation subsequent to May 24, 2002 through September 30, 2003.
All significant intercompany accounts, transactions and profits have been
eliminated upon consolidation and combination.

      Since the inception of Old CFI in December 1998 through September 30,
2003, we have funded over 1,490 advances and loans representing an aggregate of
$9.8 million in principal amount of investments in contracts. As of September
30, 2003, approximately 74% of those cases have been resolved, resulting in the
return of $7.4 million cash (representing 76% of total principal advanced) and
an annualized return on investment of 65%, including principal losses of 16% on
those resolved cases. Past results are no guarantee of future results.
Nevertheless these metrics provide useful aggregate information about the size
and past performance of our investments in contracts portfolio and may be useful
as a benchmark for future performance. While the historical settlement cycle has
averaged 15 months, the settlement cycle for advances made since March 2002 is
now less than 12 months on average. As we have gained more experience in the
marketplace, our management has focused


                                       15
<PAGE>

on improving our risk analysis, investment timing and pricing models. Over time,
our risk policies have evolved to include a set of financial metrics and
portfolio management techniques to help shorten the average investment period,
maximize collection values and minimize the risk of loss.

Revenue Generation, Recognition, and Reserve for Contract Losses

      Our advances, loans and guarantees are risk-based investments in contracts
subject to the uncertainty of future events in the prosecution of the underlying
litigation. We charge success fees (and interest in the case of loans) which are
recognized only at conclusion of the case, and only if such litigation is
successful. We base the prices we charge on our underwriting and analyses of the
risk, and additionally, in the case of advances and loans, on the time value of
money. In unsuccessful cases, we realize a loss of the investment principal. We
establish an allowance for investments in contracts that may become
uncollectible. It is maintained at a level, which in our judgment is sufficient
to cover future losses.

      Contract Fees. There are two categories of Contract Fees: i) fees
generated from the resolution of successful cases funded entirely by us, and ii)
fees generated from the resolution of successful cases arranged and serviced by
us, but funded by third parties, referred to herein as "Third Party
Investments."

      We utilize Third Party Investments in order to provide funding to our
clients in situations when our available internal capital is insufficient to
fund the transactions entirely by ourselves, or when the size of the transaction
is larger than is prudent for us to undertake directly. We receive a success fee
for originating and servicing the investment generally equal to 25% or 50% of
the income, if any, received upon successful resolution of the underlying case.
Third party investors bear the entire financial risk with respect to the
underlying investment in contract. In addition, if we also participate in the
funding, we share in the remaining fees and principal with the third party
investors according to our pro-rata share of the total capital invested.

      Service Fees. Service Fees consist of revenues we generate in connection
with our management of the investments in contracts portfolio of Old CFI under a
Service Agreement entered into in May 2002 as part of the reverse acquisition.
Old CFI has retained the underlying investments in these portfolios so our fees
are for servicing the investment portfolio during its liquidation. We earn a
service fee equal to 15% of the gross amount collected (principal plus contract
fee income) on behalf of Old CFI.

Reverse Acquisition

      On March 12, 2002, Old CFI entered into an Asset Purchase Agreement
whereby Old CFI agreed to sell its fixed assets and business operations to Asia
Web for 3,100,000 shares of Asia Web's common stock. In addition, Asia Web
agreed to purchase up to $2,500,000 of promissory notes owned by note holders of
Old CFI in exchange for 5,000,000 shares of Asia Web common stock valued at
$0.50 per share for the 60 days following closing of the transaction. As of the
closing date, Asia Web and these note holders exchanged 1,750,700 shares of Asia
Web common stock for notes receivable from Old CFI in the amount of $835,000
plus accrued interest of $40,350. These notes are unsecured, due on demand,
accrue interest at 12% to 18% per annum, and are subordinate to $2,200,000 in
secured indebtedness of Old Case. In addition, Asia Web purchased 100% of the
members' interest in Case Financial, LLC for 150,000 common shares valued at
$67,500 and $700,000 in 8% subordinated promissory notes.

Critical Accounting Policies

Revenue recognition:

      Contract fees are recognized by us when a case is settled or favorably
adjudicated. Selling commissions are incurred and expensed when the contract
investments are funded. An investment in a contract is deemed fully or partially
uncollectible when the case is dismissed or settled for an amount less than our
investment.


                                       16
<PAGE>

      In addition to contract fees from investments in contracts made by us, we
may originate and service investments in contracts on behalf of third party
investors for which we receive a success fee generally equal to 25% or 50% of
the income generated upon successful resolution of the underlying case. These
third party investments are collateralized by specifically identified
investments in contracts and are repayable only upon successful resolution and
collection of the underlying case, along with fees equal to 50% or 75% of the
amount earned. Third party investors bear the entire financial risk with respect
to the underlying investment in contract. Contract fees are presented net of
amounts paid to third party participants.

      We have established an allowance for investments in contracts that may
become uncollectible. The allowance for contract investment losses is maintained
at a level, which in our judgment is adequate to absorb losses in the contract
investment portfolio. The amount of the allowance is based on trends we see in
historical losses, and exceeds the amount experienced on resolved cases.

Use of estimates:

      The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires us to
make certain estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual amounts could differ from those
estimates.

      A significant estimate is the allowance for losses on investments in
contracts. Because of the inherent uncertainties in estimating the allowance for
losses on investments in contracts, it is likely that our estimate of the
allowance for losses on investments in contracts will change, as circumstances
become better known.

      We closely monitor the progress of each case in order to reevaluate our
estimate of uncollectible investments in contracts.

Long-lived assets:

      We review for the impairment of long-lived assets, including the notes
receivable from our affiliate Old CFI and certain identifiable intangibles,
whenever events or changes in circumstances indicate that the carrying amount of
any asset may not be recoverable. An impairment loss would be recognized when
the estimated undiscounted future cash flows expected to result from the use of
the asset and its eventual disposition are less than the carrying amount. If an
impairment is indicated, the amount of the loss to be recorded is based on an
estimate of the difference between the carrying amount and the fair value of the
asset. Fair value is based upon discounted estimated cash flows expected to
result from the use of the asset and its eventual disposition and other
valuation methods. When a note receivable becomes impaired, interest is no
longer accrued and is recognized when received in cash.

Trends and Uncertainties

      The business of providing non-recourse pre-settlement litigation funding
in personal injury and other contingency litigation is less than five years old
and, therefore, is in its infancy. We believe that only a very small percentage
of the potential business opportunity has been actualized. We have focused our
attention on educating attorneys within the State of California as to the
ethical use of alternative forms of financing. The industry has shifted from an
early emphasis on providing funding primarily to plaintiffs to funding plaintiff
lawyers and law firms. The total burden of the cost of contingency litigation
continues to increase, and we believe that law firms are beginning to understand
the value proposition in non-recourse pre-settlement funding that helps them
share the economic risk while freeing up their business and personal assets for
other purposes. Although there are a number of direct and indirect competitors
attracted to this type of specialty financing because of the high potential
returns, many have been unable to properly assess the inherent risks and have
therefore run out of capital to deploy, or experienced significant losses on
their investments. As a result of this, certain of the companies recently
entering the market have become inactive with operations consisting primarily of
holding and servicing existing investments or brokering funding transactions to
other capital providers. The focus on managing the


                                       17
<PAGE>

investment and collection risk is fundamental, and is the principal reason why
we have developed and implemented a proprietary set of risk analyses and
portfolio management tools.

      We focus on the personal injury market in California which is a large
market, and has a legal, statutory and economic climate favorable to our
business. The principal uncertainties we face are acceptance of our new L.E.G.s
loan and guaranty program, access to adequate capital to continue to build our
portfolio of investments in contracts and the regulatory requirements as a
licensed California finance lender.

Recent Developments

      Subsequent to year end, we were late three (3) times in payments to our
institutional investor. The terms of the note allow us to be late five times
before default. The note will be in default and can be called by the lender on
the sixth late payment. We are currently in compliance with the loan covenants.

RESULTS OF OPERATIONS

      Our fiscal year changed after the merger on May 24, 2002 from a December
31 year end to a September 30 year end. Results of Operations for the year ended
September 30, 2003 are compared with the nine months ended September 30, 2002

Revenues

      Revenues consist primarily of fees earned on investments in contracts,
which are recognized when the case is settled or favorably adjudicated.
Consequently, contract fee revenue is a function of the size and maturity of the
investment portfolio. In addition, subsequent to the reverse acquisition, we
manage the investments in contract portfolios of affiliates and earn a 15%
service fee based upon the gross amount collected on behalf of such affiliates
when the underlying case is settled or favorably adjudicated, and the payment
has been received. Revenues for 2002 were primarily those of Old Case and Old
CFI and reflected contract fees from contracts closed over a normal operating
cycle.

Total Revenues

      Total revenues consisting of contract fees, participations from third
party investments in contract, and service fees aggregated $527,908 for the year
ended September 30, 2003, compared with $483,366 for the nine months ended
September 30, 2002, an increase of $44,542, or 9.2%.

Contract Fees

      Contract fee revenues were $468,389 for the year ended September 30, 2003
compared with $383,104 for the nine months ended September 30, 2002, an increase
of $85,285, or 22.3%. During the year ended September 30, 2003, two related
parties advanced $913,500 or 41% of the $2,236,080 total third party
investments. We returned $674,000 or 88% of the $771,000 total third party
investment principal returned on resolved cases to three related parties. In
addition, during the year ended September 30, 2003, we distributed $181,596 or
95.1% of the total third party participation fees to those three related parties
upon successful case resolutions. Contract fees are presented net of amounts
paid to third party participants. As of September 30, 2003, third party
investments aggregated $2,236,080, of which $470,000 or 21% was from related
parties.

      Contract fee revenue is directly related to the principal amount of
successful case resolutions as well as the length of time the related investment
in contract has been outstanding. The increase in contract fee revenue for the
year ended September 30, 2003 is primarily attributable to our ability to invest
in cases that are closer to resolution and shorten the turn around time of the
outstanding cases to less then 12 months. In addition, for the


                                       18
<PAGE>

year ended September 30, 2003, the majority of the cases resolved were
attributable to third party investment participations in which we originate and
service the investment in contract on behalf of the investor for a fee equal to
25% or 50% of the income collected upon successful resolution.

      We estimate that unrecorded fee income on outstanding investments in
contracts (i.e. open cases not yet resolved) is approximately $1,583,000, which
we expect will resolve within the next three to twenty four months. Our estimate
is based on historical performance and includes a provision for losses and
settlements at amounts less than contracted fees.

Service Fees

      Service fee revenues for the year ended September 30, 2003 were $59,519 as
compared with $100,262 for the nine months ended September 30, 2002, a decrease
of $40,743, or 40.6%. Service fees are based upon collections from the
portfolios under management of older debts from Old CFI's portfolio and can
fluctuate based upon receipt of cash from this portfolio. The decline in service
fee revenue is expected to continue as a result of a shrinking amount of
advances open in the old portfolios.

Customer Concentrations

      As of September 30, 2003, advances and loans to one law firm represented
approximately 25% of our portfolio of investments in contracts, net of third
party investments. For the year ended September 30, 2003, this law firm customer
represented approximately 23% of our revenue.

Operating Costs and Expenses:

      Operating costs and expenses consist of provision for losses on
investments in contracts, general and administrative expenses, sales and
marketing expenses, and merger compensation costs.

Provision for Losses on Investments in Contracts

      Fee income is recognized when a case is settled or favorably adjudicated.
An investment in a contract is deemed fully or partially uncollectible when the
case is dismissed or settled for an amount less than our investment. We have
established an allowance for investments in contracts that may become
uncollectible. The allowance for contract investment losses is maintained at a
level, which in management's judgment, is adequate to absorb losses in the
contract investment portfolio.

      The provision for losses on investments in contracts was $300,800 for the
year ended September 30, 2003 compared with $269,485 for the nine months ended
September 30, 2002, an increase of $31,315.

      The increase in provision for losses on investments in contracts is
directly related to the increase or decrease in the investment in contracts and
the amount of related write-offs. The increase in provision for losses on
investments in contracts for the year ended September 30, 2003 compared with the
nine months ended September 30, 2002 results primarily from two factors; i)
providing for the increase in investments in contracts during the year ended
September 30, 2003 which exceeded the increase during the nine months ended
September 30, 2002, and ii) recognition during the year ended September 30, 2003
of $271,413 in write-offs which was greater than that recognized in the nine
months ended September 30, 2002. The increase in write-offs for the year ended
September 30, 2003 resulted primarily from the older portfolio and does not
indicate a trend.

Impairment of Notes Receivable

      During the year ended September 30, 2003, we recognized an impairment loss
of $635,000 on our notes receivable from Old CFI in the principal amount of
$833,209 which were acquired in connection with the reverse


                                       19
<PAGE>

acquisition. Furthermore, all but approximately $23,000 principal amount are
unsecured and subordinated to $2,200,000 secured indebtedness of Old CFI. We are
owed approximately an additional $131,000 receivable from Old CFI. The ability
of Old CFI to service and retire the notes held by us is conditioned upon two
primary factors: i) the collectibility of the portfolio of investments of Old
CFI, and ii) the value of our common stock, valued at $0.15 per share, held by
Old CFI. In connection with our obligation to manage the Old CFI portfolio held
by Old CFI, it regularly reviews the collectibility of each investment in the
portfolio. As a result of the most current review, management believes that a
portion of the Old CFI investments in contracts may be uncollectible. As such,
our estimate of the fair market value of the assets of Old CFI would be
insufficient to retire all of its indebtedness, including the notes and the
other receivable held by us, and therefore identified an additional impairment
of $131,431 in other receivables. During the nine months ended September 30,
2002, we recognized an impairment loss of $175,000 on these notes receivable.
The investments in contracts of Old CFI consist of a number of case advances
made early in the development of Old CFI's underwriting methodology and include
cases which would not meet current guidelines. As a result, the value of the Old
CFI portfolio is expected to be subject to greater loss than our current
portfolio.

General and Administrative

      General and administrative costs and expenses were $ 1,877,023 for the
year ended September 30, 2003 compared with $856,247 for the nine months ended
September 30, 2002 , an increase of $1,020,776.

      The increase in general and administrative costs and expenses for the year
ended September 30, 2003 as compared with the nine months ended September 30,
2002 is primarily attributable to increasing cost of complying with the
Sarbanes-Oxley Act of 2002 S.E.C. compliance, fund raising expenses, and the
costs of developing the L.E.G.s and Short Term Loan programs. We anticipate the
trend to reverse and reduce our general and administrative costs in the coming
year.

Sales and Marketing

      Sales and marketing expenses were $512,520 for the year ended September
30, 2003 compared with $413,250 for the nine months ended September 30, 2002. On
a 12 month annualized basis, sales and marketing expenses would have decreased
by $38,480, primarily as a result of a change in the sales staff compensation.

Merger Compensation Costs

      During the nine months ended September 30, 2002, we incurred stock based
merger compensation costs in connection with the reverse acquisition. In
addition, we agreed to pay the income tax withholding on behalf of the officers
receiving the stock grants. There were no comparable costs for the year ended
September 30, 2003. For the nine months ended September 30, 2002, merger
compensation costs aggregated $772,500.

Other Income (Expense):

Interest Income

      Interest income was $3,509 for the year ended September 30, 2003 compared
with $45,183 for the nine months ended September 30, 2002, a decrease of
$41,764.

      In each period, interest income is derived from interest earned on bank
deposits. For the nine months ended September 30, 2002, interest income includes
accrued interest from the notes receivable of an affiliate acquired in the
reverse acquisition, along with interest income received on investment in
contracts settled for an interest bearing promissory note.


                                       20
<PAGE>

Interest Expense

      Interest expense was $377,044 for the year ended September 30, 2003
compared with $331,103 for the nine months ended September 30, 2002, an increase
of $45,941, or 13.9%. Interest expense on related party indebtedness aggregated
$140,392 for the year ended September 30, 2003 compared with $294,902 for the
nine months ended September 30, 2002.

      The increase in interest expense for the year ended September 30, 2003
compared with the nine months ended September 30, 2002 results primarily from
the interest payable at 12% on $2,200,000 of debt secured in late 2002 and was
outstanding for the full year in 2003.

Legal Settlement Income and Expense

      During the year ended September 30, 2003, we received $274,866 in legal
settlements and paid $125,862 in settlement costs. There were no comparable
legal settlement income or expense in the nine months ended September 30, 2002.
See Part 1 Item 3 "LEGAL PROCEEDINGS."

      Operating Activities

      Our balance sheet at September 30, 2003, reflects cash of $192,651, an
increase of $33,442 as compare to the year ended September 30, 2002. Net cash
used in operating activities was $1,945,277 for the year ended September 30,
2003 and $633,877 for the nine months ended September 30, 2002. The increase in
cash used in operating activities of $1,311,400 was primarily attributable to
the increase in net loss of $838,154 and a decrease in accounts payable and
other liabilities of $643,078.


                                       21
<PAGE>

      Investment Activities

      Net cash used in investing activities was $2,145,799 for the year ended
September 30, 2003 an increase of $977,432 from the nine months ended September
30, 2002. This increase was primarily attributable to a rise in the dollar value
of our advances. The increase in advances made during the year ended September
30, 2003 as compared with the nine months ended September 30, 2002 was primarily
the result of new loans receivable of $788,000 relating to the Short Term Loans
program and a net increase of $219,742 in investments in contracts. In addition,
case resolutions typically average 9-15 months from date of advance and the
majority of the 2002 advances were made subsequent to the reverse acquisition in
May 2002.

      Financing Activities

      Net cash provided by financing activities was $4,124,518 for the year
ended September 30, 2003 an increase of $2,531,500 over the nine months ended
September 30, 2002. The increase was primarily attributable to the investments
described below.

      On December 5, 2002, we received $50,000 from the issuance of a 9.85%,
three-year convertible subordinated promissory note. The promissory note is
convertible into our common stock at the election of the note holder at the
conversion price of $1.00 per share. In addition, each $25,000 note payable
includes warrants to purchase 12,500 shares of our common stock at $0.60 per
share that expire in three years.

      On December 12, 2002, we closed a $2.0 million long-term debt financing
with an institutional investor. The terms of the promissory note call for
interest at 12% per annum payable monthly beginning April 1, 2003, with
principal due at maturity on December 12, 2006. In addition, the note includes
warrants to purchase 2,000,000 shares of our common stock at $0.50 per share and
warrants to purchase 1,000,000 shares of our common stock of Case Financial at
$0.80 per share that expire in four years. We also agreed to register the common
stock underlying the warrants in a registration statement filed under the
Securities Act of 1933, as amended (the "Act").

      In connection with the above financing, we incurred finder's fees
amounting to approximately $233,000 including the fair value of warrants to
purchase 200,000 common shares at $0.50 per share issued to the finders. In
addition, we incurred $83,000 in interest costs based on the fair value of the
warrants issued directly to the lender. Both the finders fees and interest costs
related to the financing have been capitalized into prepaid expenses and are
being amortized over the term of the loan.

      Effective January 1, 2003, two accredited investors (including the $50,000
December 5, 2002 transaction described above) converted their investment by
exchanging three-year, 9.85% per annum promissory notes for four-year, 12% per
annum, promissory notes issued by us. The principal amount of the promissory
notes was $200,000. As part of the conversion, we cancelled three-year warrants
to purchase 100,000 shares of common stock at $0.65 per share, and issued
four-year warrants to purchase: (i) 200,000 shares of common stock at an
exercise price of $0.50 and (ii) 100,000 shares of common stock at an exercise
price of $0.80 to the two investors. We also agreed to register the common stock
underlying the warrants in a registration statement filed under the Act.

      At September 30, 2003, we had $2,236,080 in obligations for Third Party
Investments, an increase of $1,951,080 over the balance at September 30, 2002,
$470,000 of which was from related parties. There were $674,000 in case
resolutions on the related investments in contracts during the year ended
September 30, 2003 an increase of $ 664,000 as compared with the nine months
ended September 30, 2002.

      During the year ended September 30, 2003, Case Capital Corporation began
entering into credit agreements with attorneys. The Company performs an internal
underwriting of each attorney and determines the maximum amount of investments
in contract each attorney may enter into with the Company. As of September


                                       22
<PAGE>

30, 2003, the Company has underwritten and committed to additional investment in
contract funding of approximately $612,000 under credit agreements with
attorneys.

Liquidity and Capital Resources:

      We finance our operations from the following sources:

      (1)   Resolution of existing cases in our portfolio of investments in
            contracts,
      (2)   Capital for individual cases provided by third party investors,
      (3)   Service fees we generate from the management of the investment in
            contracts portfolio of Old CFI, our affiliate, and
      (4)   Debt or equity financings.

      Our principal obligations at September 30, 2003 consisted of $2,200,000 in
12% promissory notes due in December 2006 with interest payable monthly, and
$700,000 in 8% promissory notes to affiliates issued in connection with the
acquisition of Case Financial LLC, $600,000 due May 2004, and $100,000 due May
2005, with interest payable monthly. We also had $597,873 in accounts payable,
accrued expenses and other short term debt, and $2,236,080 in third party
investments.

      The Company's independent auditors have indicated in their report that
there is substantial doubt about the Company's continuity as a going concern.

      Management has acted to reduce overhead and increase revenues. The Company
reduced its overhead in operations sales and marketing to reflect the current
funding ability of the Company. The overhead reduction was achieved by reducing
personnel, and the completion of the development of the L.E.G. and Short Term
Loan programs. The completion of the development will reduce the Company's
consulting expenses for accountants and attorneys. Management has also shifted
available funding to the Short Term Loan program in order to reduce the length
of the funding cycle and realize profits faster. The Company has had increasing
success in attracting third party investments to its Short Term Loan program.
Management believes that it can attract additional funds to the Short Term Loan
program. Management is also continuing its general fund raising activities,
which includes pursuing additional debt and equity investments and joint venture
participations with institutional and accredited investors.

      (1)   Subsequent to September 30, 2003, an officer and two directors
            loaned $260,000 to the Company payable on demand including interest
            at 12% per annum.

      Management believes that actions presently being taken or to be taken to
revise the Company's operating and financial requirements provide the
opportunity for the Company to continue as a going concern.

      Other than long-term debt payments, we do not have any material capital
expenditure commitments as of September 30, 2003.

      The current cash balance should, when combined with the anticipated cash
flows generated by contract fees on our portfolio of investments, participations
in third party investments in contracts, and anticipated service fees from the
management of the Old Case portfolios, be sufficient to finance our operations
for at least the next 12 months. However, additional cash resources may be
needed to cover long term debt repayment and interest payments.


                                       23
<PAGE>

Factors that May Affect Future Results

RISKS RELATED TO OUR BUSINESS:

OUR INDEPENDENT AUDITORS HAVE EXPRESSED DOUBT ABOUT OUR ABILITY TO CONTINUE AS A
GOING CONCERN, WHICH MAY HINDER OUR ABILITY TO OBTAIN FUTURE FINANCING.

In their report dated January 9, 2004, our independent auditors have expressed
doubt about our ability to continue as a going concern in our financial
statements for the fiscal year ended September 30, 2003. Our ability to continue
as a going concern is a result of recurring losses from operations, a
stockholders' deficit, and requirement for a significant amount of capital
financing to proceed with our business plan. Our ability to continue as a going
concern is subject to our ability to generate a profit and/or obtain necessary
funding from outside sources, including obtaining additional funding from the
sale of our securities, increasing sales or obtaining loans where possible. The
going concern uncertainty in the auditor's report increases the difficulty in
meeting such goals and there can be no assurances that such methods will prove
successful.

OUR INABILITY TO MEET DEBT OBLIGATIONS WHEN DUE COULD IMPAIR OUR ABILITY TO
FINANCE OUR OPERATIONS.

Our cash from operations may not be sufficient to meet our debt obligations as
they become due. Our access to the debt and equity markets is limited. Upon
maturity of our debt obligations, if we were unable to repay the obligations out
of operating cash flows or access the public or private capital markets for
additional funds, we would not be able to meet the obligations. The inability to
meet our debt obligations could reduce the amount of capital expenditures made
or restrict or delay investments to secure new business. In addition, our
inability to meet our debt obligations could result in an event of default and,
among other things, acceleration of the payment of our indebtedness which could
adversely impact our business, financial condition and results of operations.

OUR CASH FLOW IS DEPENDENT ON FACTORS BEYOND OUR CONTROL, INCLUDING THE
UNCERTAINTY OF LITIGATION OUTCOMES, AND THEREFORE A COLLECTION CYCLE OF
UNCERTAIN DURATION. AS A RESULT, WE MAY BE REQUIRED TO OBTAIN INTERIM FINANCING,
WHICH MAY BE ON UNFAVORABLE TERMS, RESULTING IN A MATERIAL ADVERSE IMPACT ON OUR
RESULTS OF OPERATIONS AND REVENUES, AS WELL AS OUR ABILITY TO ENGAGE IN FUTURE
BUSINESS

We may have to wait for a long period of time after we fund our advances for
resolution of the underlying claim, and only if the plaintiff is successful, do
we recover our advances or loans and fees. Based on our experience of cases
settled to date, claims have historically taken an average of 15 months to
resolve. Although we make efforts to reduce that time, once we have funded a
client, the collection cycle is largely out of our control. Accordingly, we must
use other funds to pay for our overhead expenses. Should recoveries take longer
than we planned, we may have to seek interim debt or equity financing to meet
our expenses. We cannot assure you that in such an


                                       24
<PAGE>

event we could find such financing or that, if we could, the financing would be
available on terms satisfactory to us. As a result, we may experience a material
adverse impact on our financial position, particularly our revenues, as well as
our ability to continue to fund current and future clients.

OUR BUSINESS IS CAPITAL INTENSIVE. IN ORDER TO ACHIEVE PROFITABILITY OUR
PORTFOLIO OF INVESTMENTS IN CONTRACTS, EXCLUSIVE OF THIRD PARTY INVESTMENTS,
MUST EXCEED $4,000,000 FOR A PERIOD OUTSTANDING OF AT LEAST NINE MONTHS

Our business strategy requires us to deploy sufficient capital in order to
create the scale necessary to generate a profit. In order to become profitable,
we must have sufficient working capital to build a portfolio of investments in
contracts (exclusive of third party investments) which aggregate at least
$4,000,000 in principal amount of advances, loans or guarantees; and which have
been outstanding for a period of at least nine months. Our failure to obtain and
maintain the necessary capital or guarantees to meet this minimum threshold will
result in continuing losses assuming our current expenses and will have a
material adverse effect on our business, financial condition and results of
operations.

IF ACTUAL LOSSES EXCEED OUR LOSS RESERVES, OUR RESULTS OF OPERATIONS AND WORKING
CAPITAL WILL BE ADVERSELY AFFECTED

We maintain a reserve for investments in contracts that may not be favorably
resolved. We are not able to make an exact calculation of losses but rather we
make estimates of losses based on our experience with similar cases. We base
these estimates on facts and circumstances then known, predictions of future
events, estimates of future trends in claims and judicial theories of liability.
For example, we may not be able to collect upon the judgment recovery when and
if it is delivered to the plaintiff's counsel, or we may not be able to collect
without bringing a legal action against the former plaintiff. Because our
establishment of loss reserves is an inherently uncertain process we cannot
assure you that our ultimate losses will not exceed our loss reserves. If our
reserve levels are inadequate, we will be required to increase our loss reserves
and loss adjustment expenses and our results of operations, working capital and
stockholder's equity will be adversely affected.

WE PROVIDE FUNDING PRIMARILY ON STATE AND FEDERAL LITIGATION CONDUCTED WITHIN
CALIFORNIA COURTS. OUR ABILITY TO EXPAND OUTSIDE OF CALIFORNIA IS LIMITED BY
JURISDICTIONAL LIMITATIONS

Not all states allow loans, guarantees or advances to attorneys and plaintiffs.
Some jurisdictions do not allow maintaining, supporting, promoting or assisting
another person, with money or otherwise, to prosecute a lawsuit, or
"maintenance." Similarly, the bargain between a stranger and a party to a
lawsuit by which the stranger pursues the party's claim in consideration of
receiving part of any judgment proceeds may be a form of "maintenance" and may
not be permitted in some jurisdictions. Our ability to grow and expand our
business outside of California is limited to specific jurisdictions which permit
us to conduct operations. Our inability to expand outside of California may
negatively impact our ability to grow.

COURTS MAY DEEM OUR ADVANCES PRIOR TO APRIL 2003 TO BE LOANS RESULTING IN
REDUCED OPERATING REVENUES

Prior to Case Capital Corporation becoming a licensed California finance lender
in April 2003, we made advances not loans or guarantees. While we believe that
we were not subject to various laws and regulations in California that constrain
lending activities with respect to our activities prior to April 2003, we cannot
assure you that a court in any jurisdiction in which we pursued our business
would not examine our activities and come to the conclusion that we were in fact
lending money to plaintiffs. If a court determines that our activities
constituted lending in violation of local law, our agreements would be voidable,
and we could be subjected to fines and other sanctions.


                                       25
<PAGE>

Such a conclusion would significantly impact our financial condition, as well as
reduce our ability to fund new plaintiffs.

THE BUSINESS OF MAKING NON-RECOURSE ADVANCES, LOANS AND GUARANTEES IN PERSONAL
INJURY AND CONTINGENCY LITIGATION IS A NEW BUSINESS. ACCORDINGLY, IT MAY BE
DIFFICULT TO EVALUATE OUR BUSINESS AND RESULTS OF OPERATIONS, WHICH MAY HAVE A
MATERIAL ADVERSE IMPACT ON OUR STOCK PRICE.

The business of making non-recourse advances, loans and guarantees in personal
injury and other contingency litigation is less than five years old. While we
are one of the earliest entrants, we have only four years of precedents upon
which to base our operations. In addition, none of our officers or directors has
experience in the business of lending prior to joining the company. While we
believe that the time spent in the past four years refining our risk analysis
procedures allows us to evaluate the lawyers, plaintiffs and cases to whom we
advance money, there is no extensive history in risk analysis upon which we or
investors may rely. Although we make comparisons to other claims and compile a
database of case activity to assist our operations, we do not have an extensive
database upon which we can make our risk decisions. Risk decisions made on
incomplete or inaccurately assessed information may lead to lower rates of
claims recovery and may have an adverse impact on our business and results of
our operations.

IN ORDER TO GENERATE BUSINESS AND OPERATE PROFITABLY, WE MUST EDUCATE CUSTOMERS
ABOUT OUR SERVICES

Unlike other financial services, the business of providing non-recourse
pre-settlement funding in contingency litigation is not well-known among
plaintiff attorneys, nor among the general population, which includes current
and future plaintiffs. As a result, we must utilize strong sales efforts to
increase awareness of our business in order to increase our customer base and
market. Therefore, we cannot give any assurances that we will be successful in
educating potential customers about our services and especially educating
customers about our services in a manner that will be attractive to them. A
failure to so educate customers may reduce our client base as well as our
overall market, which may have an adverse impact on our ability to grow.

OUR BUSINESS MAY BE COPIED BY COMPETITORS AS THERE ARE FEW BARRIERS TO
COMPETITION

Other than financial capabilities, an expertise in assessing risks, our
proprietary business processes and supporting infrastructure, our business is
not dependent upon proprietary information that could not otherwise be
duplicated. Accordingly, there are no substantial barriers to potential
competitors. We may not be able to compete successfully against current or
future competitors. In addition, competition may drive down the return on our
advances, loans, or guarantees. Given the risks inherent in our business, a
reduction in our rate of return may impact the viability of our business model.
There is no assurance that we may be able to compete successfully against others
who offer similar services or that such competition may not reduce the rate of
return we receive for our funding.

OUR BUSINESS IS DEPENDENT ON KEY PERSONNEL, AND THE LOSS OF ANY OF THESE
EMPLOYEES MAY HAVE A MATERIAL DETRIMENTAL IMPACT ON OUR ABILITY TO CONDUCT
BUSINESS AND OBTAIN FUTURE CLIENTS

Our future performance depends on the service of key personnel such as Eric
Alden, Chief Executive Officer, Lorne Pollock, Vice President Underwriting, Gary
Primes, Chief Information Officer and Vice President of Operations, and James
Lewis, Vice President of Sales, and our ability to attract, train, and retain
additional risk, technical, sales, marketing, customer support, and management
personnel. While we have employment agreements with three of our key employees,
none of which restrict them from leaving our company and/or pursuing
opportunities with competitors, we do not have a written employment agreement
with Eric Alden. The


                                       26
<PAGE>

loss of one or more key employees could negatively impact us. We cannot assure
you that we will retain these key employees, or attract and retain other needed
personnel.

RISKS RELATED TO OWNING OUR COMMON STOCK:

EXERCISE OF OPTIONS AND WARRANTS WILL DILUTE EXISTING STOCKHOLDERS BY UP TO
57.7% AND COULD DILUTE YOUR INTEREST IN OUR COMMON STOCK

As of September 30, 2003, we had issued and outstanding 15,561,108 shares of
common stock, outstanding options to purchase 3,515,000 additional shares of
common stock, with a weighted average exercise price of $0.33 and a weighted
average life of 6 years, and warrants to purchase 5,475,000 additional shares of
common stock: 1,975,000 shares at $3.00 expiring July 2004, 1,100,000 shares at
$0.80 and 2,400,000 shares at $0.50 expiring December 2006. The exercise of such
options and warrants may dilute your interest and ownership in our stock by
57.7% after full exercise. Such dilution may also limit our ability to raise
additional capital through equity sales.

OUR OFFICERS AND DIRECTORS COLLECTIVELY OWN APPROXIMATELY 25.9% OF THE
OUTSTANDING SHARES OF OUR COMMON STOCK, WHICH ALLOWS THESE STOCKHOLDERS TO
EXERCISE SIGNIFICANT CONTROL OVER MATTERS REQUIRING APPROVAL OF THE
STOCKHOLDERS. ACCORDINGLY, THIS MAY RESTRICT YOUR ABILITY TO EFFECTUATE AN
ACTION CONTRARY TO THE POSITION OF OUR BOARD AND MANAGEMENT, SHOULD THEY CHOOSE
TO ACT AS A GROUP, AND MAY MAKE IT DIFFICULT FOR YOU TO RECEIVE A PREMIUM FOR
YOUR SHARES OF STOCK

As a result of the significant collective ownership of our officers and
directors, other investors may have limited control over matters requiring
approval by the stockholders, including the election of directors, should the
officers and directors choose to act as a group. Such concentrated control may
also make it difficult for you to receive a premium for your shares of our
common stock should you choose to sell them in opposition to the board of
directors and management.

OUR COMMON STOCK IS LISTED ON THE OVER-THE-COUNTER (OTC) BULLETIN BOARD, WHICH
MAY MAKE IT MORE DIFFICULT FOR STOCKHOLDERS TO SELL THEIR SHARES AND MAY CAUSE
THE MARKET PRICE OF OUR COMMON STOCK TO DECREASE

Because our common stock is listed on the OTC Bulletin Board, the liquidity of
our common stock is impaired, not only in the number of shares that are bought
and sold, but also through delays in the timing of transactions, and limited
coverage by security analysts and the news media of us. As a result, prices for
shares of our common stock may be lower than might otherwise prevail if our
common stock was traded on NASDAQ or a national securities exchange, like the
American Stock Exchange.

OUR CHARTER DOCUMENTS AND DELAWARE LAW MAY HAVE THE EFFECT OF MAKING IT MORE
EXPENSIVE OR MORE DIFFICULT FOR A THIRD PARTY TO ACQUIRE, OR TO ACQUIRE CONTROL,
OF US

Although we currently do not have any such shareholder rights outstanding, our
certificate of incorporation makes it possible for our Board of Directors to
issue preferred stock with voting or other rights that could impede the success
of any attempt to change control of us. Delaware law prohibits a publicly held
Delaware corporation from engaging in certain business combinations with certain
persons, who acquire our securities with the intent of engaging in a business
combination, unless the proposed transaction is approved in a prescribed manner.
This provision has the effect of discouraging transactions not approved by our
Board of Directors as required by the statute which may discourage third parties
from attempting to acquire or to acquire control of us even if the attempt would
result in a premium over market price for the shares of common stock held by our
stockholders.


                                       27
<PAGE>

OUR COMMON STOCK IS SUBJECT TO "PENNY STOCK" RULES

The Securities and Exchange Commission has adopted Rule 15g-9 which establishes
the definition of a "penny stock," for the purposes relevant to us, as any
equity security that has a market price of less than $5.00 per share or with an
exercise price of less than $5.00 per share, subject to certain exceptions. For
any transaction involving a penny stock, unless exempt, the rules require: (i)
that a broker or dealer approve a person's account for transactions in penny
stocks; and (ii) the broker or dealer receive from the investor a written
agreement to the transaction, setting forth the identity and quantity of the
penny stock to be purchased. In order to approve a person's account for
transactions in penny stocks, the broker or dealer must (i) obtain financial
information and investment experience objectives of the person; and (ii) make a
reasonable determination that the transactions in penny stocks are suitable for
that person and the person has sufficient knowledge and experience in financial
matters to be capable of evaluating the risks of transactions in penny stocks.
The broker or dealer must also deliver, prior to any transaction in a penny
stock, a disclosure schedule prepared by the SEC relating to the penny stock
market, which, in highlight form, (i) sets forth the basis on which the broker
or dealer made the suitability determination; and (ii) that the broker or dealer
received a signed, written agreement from the investor prior to the transaction.
Disclosure also has to be made about the risks of investing in penny stocks in
both public offerings and in secondary trading and about the commissions payable
to both the broker-dealer and the registered representative, current quotations
for the securities and the rights and remedies available to an investor in cases
of fraud in penny stock transactions. Finally, monthly statements have to be
sent disclosing recent price information for the penny stock held in the account
and information on the limited market in penny stocks.


                                       28
<PAGE>

Item 7. Financial Statements

               Report of Independent Certified Public Accountants

The Board of Directors and Stockholders
Case Financial, Inc.
Encino, California

We have audited the accompanying consolidated balance sheets of Case Financial,
Inc. and its subsidiaries Case Financial, LLC and Case Capital Corporation (the
"Company") as of September 30, 2003 and 2002, and the related consolidated
statements of operations, stockholders' equity (deficiency), and cash flows for
the year and nine months then ended, respectively. These financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of the Company as of September 30,
2003 and 2002, and the results of its operations and its cash flows for the year
and nine months then ended, respectively, in conformity with accounting
principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 14 to the
financial statements, the Company incurred net losses of $3,127,190 and
$2,289,036 during the year and nine months ended September 30, 2003 and 2002,
respectively, there was an accumulated deficit of $9,865,720 as of September 30,
2003, total liabilities exceeded total assets by $1,962,102 as of September 30,
2003, and the Company has been experiencing cash flow problems. These conditions
raise substantial doubt about its ability to continue as a going concern.
Management's plans regarding those matters also are described in Note 14. The
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.

GUMBINER, SAVETT, FINKEL, FINGLESON & ROSE, INC.

Santa Monica, California
January 9, 2004


                                       29
<PAGE>
                      CASE FINANCIAL, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                           September 30, 2002 and 2003

<TABLE>
<CAPTION>
                                                                               September 30,   September 30,
                                                                                    2002           2003
                                                                               -------------   -------------
ASSETS
<S>                                                                             <C>             <C>
Cash  (Note 3)                                                                  $   159,209     $   192,651
Investments in contracts, net of allowance for contract losses of
  $228,902 at September 30, 2002 and $258,289 at September 30, 2003               1,224,199       2,265,112
  (Notes 4 and 6)
Loans receivable                                                                         --         788,000
Prepayments and other assets                                                         47,355         317,571
Receivables and other assets, related parties, net of impairment                    341,266         126,393
  allowance of $131,431 at September 30, 2003 (Note 11)
Equipment, at cost, net of accumulated depreciation of $90,674
  at September 30, 2002  and $137,868 at September 30, 2003                          88,749          58,914
  (Note 5)
Notes receivable from affiliate, net of impairment allowance of
  $175,000 at September 30, 3002 and $810,000 at
  September 30, 2003 (Notes 2 and 11)                                               659,481          23,209
                                                                                -----------     -----------
     TOTAL ASSETS                                                               $ 2,520,259     $ 3,771,850
                                                                                ===========     ===========

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCY)

Accounts payable and accrued expenses                                           $   340,850     $   474,434
Accrued compensation (Note 12)                                                      165,000              --
Loans payable - related parties (Note 6)                                            985,000       1,293,438
Loans payable  (Note 7)                                                             150,000       3,966,080
                                                                                -----------     -----------
     TOTAL LIABILITIES                                                            1,640,850       5,733,952
                                                                                -----------     -----------

COMMITMENTS AND CONTINGENCIES (Notes 4 and 8)

STOCKHOLDERS' EQUITY (DEFICIENCY) (Note 10)
     Common stock, par value $0.001 per share,
     100,000,000 shares authorized, 15,561,108 shares issued and outstanding         15,561          15,561
     Paid-in-capital                                                              7,602,378       7,888,057
     Accumulated deficit                                                         (6,738,530)     (9,865,720)
                                                                                -----------     -----------
     TOTAL STOCKHOLDERS' EQUITY (DEFICIENCY)                                        879,409      (1,962,102)
                                                                                -----------     -----------
     TOTAL LIABILITIES AND
          STOCKHOLDERS' EQUITY (DEFICIENCY)                                     $ 2,520,259     $ 3,771,850
                                                                                ===========     ===========
</TABLE>

          See accompanying notes to consolidated financial statements.


                                       30
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
           For the nine months ended September 30, 2002 and year ended
                               September 30, 2003

<TABLE>
<CAPTION>
                                                         Nine Months
                                                           ended           Year ended
                                                        September 30,     September 30,
                                                            2002             2003
                                                        -------------     ------------
<S>                                                     <C>              <C>
REVENUE
    Contract fees                                       $    383,104     $    468,389
    Service fees, related parties (Note 11)                  100,262           59,519
                                                        ------------     ------------
          TOTAL REVENUE                                      483,366          527,908
                                                        ------------     ------------

OPERATING EXPENSES
    Provision for losses on investments in contracts         269,485          300,800
    Provision for impairment of notes and other
      receivables from affiliate (Note 11)                   175,000          766,431
    General and administrative                               856,247        1,877,023
    Sales and marketing                                      413,250          512,520
    Merger compensation costs (Note 12)                      772,500               --
                                                        ------------     ------------
       TOTAL OPERATING EXPENSES                            2,486,482        3,456,774
                                                        ------------     ------------
    LOSS FROM OPERATIONS                                  (2,003,116)      (2,928,866)
                                                        ------------     ------------

OTHER INCOME (EXPENSE)
    Interest income  (Note 11)                                45,183            3,509
    Interest expense  (Note 11)                             (331,103)        (377,044)
    Legal settlement (Note 8)                                     --          175,211
                                                        ------------     ------------

       TOTAL OTHER INCOME (EXPENSE)                         (285,920)        (198,324)
                                                        ------------     ------------
    NET LOSS                                            $ (2,289,036)    $ (3,127,190)
                                                        ============     ============

Net loss per common share -
  basic and diluted                                     $      (0.25)    $      (0.20)
Weighted average number of shares                          9,192,611       15,561,108
</TABLE>

            See accompany notes to consolidated financial statements


                                       31
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
         For the nine months ended September 30, 2002 and the year ended
                               September 30 2003

<TABLE>
<CAPTION>
                                                                                                   Nine Months
                                                                                                      ended         Year ended
                                                                                                  September 30,    September 30,
                                                                                                      2002             2003
                                                                                                  -------------    -------------
<S>                                                                                                <C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss                                                                                           $(2,289,036)    $(3,127,190)
Adjustments to reconcile net loss to net cash used in operating activities:
      Depreciation                                                                                      26,082          47,193
      Amortization of debt premium                                                                      25,278          75,828
      Provision for losses on investments in contracts                                                 269,485         300,800
      Provision for impairment of notes and other receivables from affiliate                           175,000         766,431
      Common stock and options for compensation                                                        667,004         167,358
      Amortization of warrants issued with debt                                                             --          24,650
   Changes in operating assets and liabilities
          Increase in prepayments and other assets                                                    (119,352)       (168,931)
          Increase (decrease) in accounts payable and other liabilities                                611,662         (31,416)
                                                                                                   -----------     -----------
          Net cash used in operating activities                                                       (633,877)     (1,945,277)
                                                                                                   -----------     -----------

CASH FLOWS FROM INVESTING ACTIVITIES:
      Purchase of short-term investments                                                                    --      (1,025,000)
      Redemptions of short-term investments                                                                 --       1,025,000
   Investment in contracts  -- advances                                                             (2,111,069)     (3,053,173)
   Investment in contracts  -- collections                                                             989,099       1,711,460
   Increase in loans receivable                                                                             --        (788,000)
   Principal repayments on notes receivable from affiliate                                                 519           1,273
   Purchase of equipment                                                                               (46,916)        (17,359)
                                                                                                   -----------     -----------
          Net cash used in investing activities                                                     (1,168,367)     (2,145,799)
                                                                                                   -----------     -----------

CASH FLOWS FROM FINANCING ACTIVITIES:
   Capital lease principal payments                                                                     (2,101)             --
   Proceeds from borrowings                                                                            150,000       3,919,060
   Repayments of borrowings                                                                            (34,799)       (102,980)
   Proceeds from related party borrowings                                                              285,000       1,086,938
   Repayments of related party borrowings                                                                   --        (778,500)
      Net cash received in acquisition                                                               1,355,932              --
      Net cash retained by Old Case in acquisition                                                     (84,079)             --
      Merger costs of Asia Web                                                                         (76,935)             --
                                                                                                   -----------     -----------
        Net cash provided by financing activities                                                    1,593,018       4,124,518
                                                                                                   -----------     -----------
NET INCREASE (DECREASE) IN CASH                                                                       (209,226)         33,442

CASH - BEGINNING OF PERIOD                                                                             368,435         159,209
                                                                                                   -----------     -----------

CASH - END OF PERIOD                                                                               $   159,209     $   192,651
                                                                                                   ===========     ===========


SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
  Cash paid during the period for:
     Interest                                                                                      $    12,000     $   251,910

SUPPLEMENTAL SCHEDULE OF NON-CASH FINANCING ACTIVITIES:
    Warrants issued with debt                                                                      $        --     $   118,321

In May 2002, the following were acquired in connection with the reverse
acquisition:
   Other assets, net of cash of $1,355,932                                                         $     1,867
   Property and equipment                                                                          $    31,183
   Accounts payable and accrued expenses                                                           $  (141,785)
                                                                                                   -----------
            Excess of liabilities of Asia Web over other assets acquired in reverse acquisition    $  (108,735)
                                                                                                   ===========

   Promissory notes and accrued interest in exchange for 1,750,700
   shares of common stock                                                                          $   875,350

   Members' equity of Case Financial, LLC exchanged for $700,000
   promissory notes and 150,000 shares of common stock                                             $   767,500
</TABLE>

          See accompanying notes to consolidated financial statements.


                                       32
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
          CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIENCY)
        For the nine months ended September 30, 2002 and the year ended
                               September 30, 2003

<TABLE>
<CAPTION>
                                                                   Common Stock
                                                             ------------------------
                                                               Number of
                                                                Shares
                                                              Issued (and   $.001 Par     Paid-in-     Accumulated
                                                             to be issued)    Value       Capital        Deficit         Total
                                                             --------------------------------------------------------------------
<S>                                                            <C>         <C>           <C>           <C>            <C>
Balance, December 31, 2001                                     3,487,500   $ 1,400,100   $   138,957   $ (4,620,665)  $(3,081,608)

Warrants of Old CFI issued for consulting services                                             5,533                        5,533

Options of Old CFI issued for compensation                                                    12,999                       12,999

Reverse Acquitision (Note 2)
Recapitalization of Old CFI                                     (867,500)   (1,397,480)    1,397,480                           --
Acquisition of Asia Web                                        8,735,408         8,735     1,238,462                    1,247,197
  Net Liabilitites retained by Old CFI                                                     3,298,642                    3,298,642


Common shares issued as investment banking fee
   and other merger costs charged to
      paid-in-capital                                            480,000           480       (77,415)                     (76,935)

Common shares issued to acquire notes receivable and
   accrued interest (Note 2)                                   1,750,700         1,751       873,599                      875,350

Common shares approved for issuance as
  compensation (Note 2)                                        1,825,000         1,825       614,390                      616,215

Common shares issued in connection with acquisition
   of Case Financial, LLC, including elimation of
   accumulated deficit (Note 2)                                  150,000           150        67,474        171,171       238,795

Options issued for compensation (Note 10)                                                     32,257                       32,257

Net loss for the nine months                                                                             (2,289,036)   (2,289,036)
                                                              -------------------------------------------------------------------
Balance  September 30, 2002                                   15,561,108        15,561     7,602,378     (6,738,530)      879,409

Warrants issued in connection with debt financing (Note 10)                                  110,276                      110,276

Warrants issued to finders in connection with debt financing
  (Note 10)                                                                                    8,045                        8,045

Stock/Option compensation charged to expense (Note 10)                                       167,358                      167,358

Net loss for year                                                                                        (3,127,190)   (3,127,190)
                                                              -------------------------------------------------------------------
Balance September 30, 2003                                    15,561,108   $    15,561   $ 7,888,057   $ (9,865,720)  $(1,962,102)
                                                              ===================================================================
</TABLE>

          See accompanying notes to consolidated financial statements.


                                       33
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
         For the nine months ended September 30, 2002 and the year ended
                               September 30, 2003

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

      Nature of activities:

            Case Financial, Inc. was incorporated in 1998 and took over the net
            assets, primarily cash, of Asia Web Holdings, Inc. ("Asia Web"), a
            publicly traded company incorporated in the state of Delaware, by
            way of a reverse acquisition completed on May 24, 2002. As a result
            of the transaction, Asia Web changed its name to Case Financial,
            Inc. and continued the business of the Company. The Company also
            changed its year end from December 31 to September 30. Case
            Financial Inc. and its subsidiaries, Case Financial, LLC, and Case
            Capital Corporation ("Case" or the "Company") provide pre-settlement
            litigation funding services to attorneys and plaintiffs involved in
            personal injury and other contingency litigation, conducted
            primarily within the California courts.

            The Company's investments in contracts are made in the form of
            "non-recourse" advances or loans, meaning that the investment
            principal, success fees and interest are repaid only when the case
            is settled or favorably adjudicated in court. The investments are
            collateralized solely by the proceeds of underlying litigation. The
            Company performs an internal underwriting as to the merits of each
            case proposed to be financed, the likelihood of its success, and the
            estimated settlement value. The Company's investment decisions and
            the pricing of its fees are based on this risk analysis and its
            estimate of settlement timing.

            In April 2003, Case Capital Corporation became a licensed California
            Finance lender and began making interest-bearing short-term
            collateralized term loans. The Company charges loan fees in
            connection with these term loans. In addition, interest is charged
            on these loans if the loans are not repaid by a specified date,
            which is generally before the maturity date. The term loans are
            typically collateralized by the assets of the borrowers, typically
            law firms and attorneys, as well as personal guarantees from the
            attorneys. The Company performs an internal underwriting as to the
            adequacy of the collateral. During the year ended September 30,
            2003, the Company advanced $788,000 on new term loans.

            During 2003, Case Capital Corporation began entering into credit
            agreements with attorneys. The Company performs an internal
            underwriting of each attorney and determines the maximum amount of
            investments in contracts each attorney may enter into with the
            Company.

            Operations are conducted from leased premises in Sherman Oaks,
            California.


                                       34
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
         For the nine months ended September 30, 2002 and the year ended
                               September 30, 2003

      Basis of presentation:

            Through May 24, 2002, the combined financial statements include the
            accounts of Case Financial, Inc., its wholly owned subsidiary, Case
            Financial Funding, Inc. and Case Financial, LLC, a company related
            through common ownership ("Old Case"). The accompanying financial
            statements also include the accounts of Case Financial Inc. and its
            subsidiaries, Case Financial, LLC and Case Capital Corporation,
            subsequent to the merger (May 24, 2002) through September 30, 2003.
            All significant intercompany accounts, transactions and profits have
            been eliminated upon consolidation and combination.

      Revenue recognition:

            Fee income from investments in contracts is recognized when a case
            is settled or favorably adjudicated. Selling commissions are
            incurred and expensed when the underlying case of contract
            investments is settled favorably. An investment in a contract is
            deemed fully or partially uncollectible when the case is dismissed,
            abandoned, or settled for an amount less than the Company's
            investment.

            In addition to contract fees from investments in contracts made by
            the Company, the Company also originates and services investments in
            contracts on behalf of third party investors. At times, the Company
            participates in these investments. In the case of these third party
            investments, the Company receives a success fee equal to 25% or 50%
            of the income generated upon successful resolution of the underlying
            case, at which time revenue is recorded. These third party
            investments are collateralized by specifically identified
            investments in contracts and are repayable to the investor only upon
            successful resolution and collection on the underlying case, along
            with 75% or 50% of the fees earned. Third party investors bear
            financial risk with respect to the underlying investment in contract
            in relation to their proportionate interest in the contract.
            Contract fees are presented net of amounts paid to third party
            participants.

            The Company has established an allowance for investments in
            contracts that may become uncollectible. The allowance for contract
            investment losses is maintained at a level, which in management's
            judgment, is adequate to absorb losses in the contract investment
            portfolio. The amount of the allowance is based on trends in
            historical loss experience.

            Loan fees, net of direct costs, charged on loans receivable are
            deferred and amortized over the life of the related loan using the
            effective interest method. Interest on these loans is accrued as
            earned. No interest or loan fees on the loans receivable were
            recognized during 2003.

            The Company earns service fees from a contract entered into with Old
            CFI at the time of the merger (See Note 2). The Company manages Old
            CFI's portfolios of investments for a fee equal to 15% of gross
            amounts collected on its behalf.


                                       35
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
         For the nine months ended September 30, 2002 and the year ended
                               September 30, 2003

      Use of estimates:

            The preparation of financial statements in conformity with
            accounting principles generally accepted in the United States of
            America requires management to make certain estimates and
            assumptions that affect the reported amounts of assets and
            liabilities and disclosure of contingent assets and liabilities at
            the date of the financial statements and the reported amounts of
            revenues and expenses during the reporting period. Actual amounts
            could differ from those estimates.

            A significant estimate is the allowance for losses on investments in
            contracts and loans receivable. Because of the inherent
            uncertainties in estimating the allowance for losses on investments
            in contracts and loans receivable, it is likely that the Company's
            estimate of the allowance for losses on investments in contracts and
            loans receivable will change as circumstances become better known.
            Management closely monitors the progress of each case in order to
            reevaluate its estimate of uncollectible investments in contracts
            and loans receivable.

      Depreciation:

            Depreciation is computed using accelerated methods based on the
            estimated useful lives of the assets, generally as follows:

                  Computer software                           3 years
                  Office furniture and fixtures               5-7 years
                  Equipment                                   5 years

      Long-lived assets:

            The Company reviews for the impairment of long-lived assets,
            including the notes receivable from affiliate, and certain
            identifiable intangibles whenever events or changes in circumstances
            indicate that the carrying amount of any asset may not be
            recoverable. An impairment loss would be recognized when the
            estimated undiscounted future cash flows expected to result from the
            use of the asset and its eventual disposition is less than the
            carrying amount. If an impairment is indicated, the amount of the
            loss to be recorded is based on an estimate of the difference
            between the carrying amount and the fair value of the asset. Fair
            value is based upon discounted estimated cash flows expected to
            result from the use of the asset and its eventual disposition and
            other valuation methods. When a note receivable becomes impaired,
            interest is no longer accrued and is recognized when received in
            cash.

      Prepayments and other assets:

            Finders' fees, prepaid interest, and loan fees are included in
            prepayments and other assets. These assets are amortized on the
            straight-line method over the term of the related debt and are
            expensed immediately in the case of demand notes.


                                       36
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
         For the nine months ended September 30, 2002 and the year ended
                               September 30, 2003

      Deferred taxes on income:

            The Company records deferred taxes on income for transactions that
            are reported in different years for financial reporting and tax
            purposes using an asset and liability method whereby assets and
            liabilities are recognized for the future tax consequences
            attributable to differences between the financial statement carrying
            amounts of existing assets and liabilities and their respective tax
            bases. Deferred tax assets and liabilities are measured using
            enacted tax rates expected to be recovered or settled. The effect on
            deferred tax assets and liabilities of a change in tax rates is
            recognized in income in the period that includes the enactment date.
            A valuation allowance is established against deferred tax assets
            when the Company is unable to determine it is more likely than not
            that the deferred tax assets will be realized.

      Stock-based compensation:

            The Company accounts for stock-based compensation arrangements in
            accordance with the provisions of SFAS No. 123, "Accounting for
            Stock-Based Compensation," as amended by SFAS No. 148, which
            establishes a fair value-based method of accounting for stock-based
            compensation plans. Under SFAS No. 123, compensation cost is
            recognized based on the difference, if any, on the date of grant
            between the fair value of the Company's common stock and the amount
            the grantee must pay to acquire the stock. The Company uses the
            Black-Scholes option pricing model to determine the fair value of
            each stock option granted.

      Loss per common share:

            Basic and diluted loss per common share is computed by dividing the
            net loss by the weighted average number of common shares outstanding
            for each of the periods presented. The weighted average number of
            common shares outstanding for computing the basic and diluted loss
            per common share was 9,192,611 for the nine months ended September
            30, 2002, and 15,561,108 for the year ended September 30, 2003. The
            weighted average number of common shares outstanding does not
            include 8,990,000 options and warrants outstanding at September 30,
            2003 and 4,150,000 options and warrants outstanding at September 30,
            2002 because they are antidilutive.


                                       37
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
         For the nine months ended September 30, 2002 and the year ended
                               September 30, 2003

      Fair value of financial instruments

            The carrying value of cash, investments in contracts, loans
            receivable, and accrued expenses are measured at cost which
            approximates their fair value. The carrying value of loans payable
            approximate fair value based on current rates at which the Company
            could borrow funds with similar remaining maturities. The fair value
            of receivables from related parties, notes receivable from
            affiliate, and loans payable related parties cannot be reasonably
            estimated due to their related party nature.

      Current accounting pronouncements:

            In November 2002, the FASB issued SFASB Interpretation No. 45,
            "Guarantor's Accounting and Disclosure Requirements for Guarantees,
            Including Indirect Guarantees of Indebtedness of Others." The
            interpretation addresses the disclosures to be made by a guarantor
            in its interim and annual financial statements about its obligations
            under guarantees. The interpretation also clarifies the requirements
            related to the recognition of a liability by a guarantor at the
            inception of a guarantee for the obligations the guarantor has
            undertaken in issuing that guarantee. The initial recognition and
            initial measurement provisions of the interpretation shall be
            applied only on a prospective basis to guarantees issued or modified
            after December 31, 2002. The disclosure requirements of the
            interpretation are effective for financial statements of interim or
            annual periods ending after December 15, 2002. This pronouncement
            has been adopted by the Company.

            In December 2002, the FASB issued SFAS No. 148, "Accounting for
            Stock-Based Compensation - Transition and Disclosure, an amendment
            of SFAS Statement No. 123." This statement amends SFAS Statement No.
            123, "Accounting for Stock-Based Compensation," to provide
            alternative methods of transition for an entity that voluntarily
            changes to the fair value based method of accounting for stock-based
            employee compensation. It also amends the disclosure provisions of
            that statement to require prominent disclosure about the effects on
            reported net income of an entity's accounting policy decisions with
            respect to stock-based employee compensation. Finally, the statement
            amends APB Opinion No. 28, "Interim Financial Reporting," to require
            disclosure about those effects in interim financial information.
            Amendments to the transition and disclosure provisions of SFAS 123
            are effective for financial statements for fiscal years ending after
            December 15, 2002. Earlier application of the transition provisions
            is permitted for entities with a fiscal year ending prior to
            December 15, 2002, provided that financial statements for the 2002
            fiscal year have not been issued as of the date the statement is
            issued. Early application of the disclosure provisions is
            encouraged. The amendment to Opinion 28 is effective for financial
            reports containing condensed financial statements for interim
            periods beginning after December 15, 2002. Early application is
            encouraged. The adoption of this pronouncement has not and is not
            expected to have a material effect on the Company's financial
            position or results of operations as of the implementation date.

      Reclassifications:

            Certain items in prior financial statements are reclassified to
            conform to the current presentation.


                                       38
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
         For the nine months ended September 30, 2002 and the year ended
                               September 30, 2003

NOTE 2: REVERSE ACQUISITION

      On March 12, 2002, Old CFI entered into an Asset Purchase Agreement
      ("Agreement") whereby Old CFI agreed to sell certain assets, including its
      business operations, to Asia Web for 3,100,000 shares of Asia Web's common
      stock, including an investment banking fee of 480,000 shares valued at
      $216,000. In addition, Asia Web agreed to purchase up to $2,500,000 of
      promissory notes owned by note holders of Old CFI in exchange for
      5,000,000 shares of Asia Web common stock valued at $0.50 per share for
      the 60 days following closing of the transaction. As of the closing date,
      Asia Web and these note holders exchanged 1,750,700 shares of Asia Web
      common stock for notes receivable from Old CFI in the amount of $835,000
      plus accrued interest of $40,350. These notes are unsecured, due on
      demand, accrue interest at 12 to 18 percent per annum, and subordinate to
      $2,200536,000 in secured indebtedness of Old CFI. In addition, Asia Web
      purchased 100% of the members' interest in Case Financial, LLC for 150,000
      common shares valued at $67,500 and $700,000 in 8% subordinated promissory
      notes. The transaction was completed on May 24, 2002 at which time the
      Company acquired approximately $1,400,000 cash from Asia Web, and assumed
      liabilities in excess of other assets received of approximately $109,000.
      At closing, Old CFI retained its investments in contracts of approximately
      $1,889,000 along with $4,890,000 related indebtedness and other
      liabilities. In addition, Old CFI entered into a service agreement with
      the Company to manage Old CFI's portfolios for a fee equal to 15 percent
      of gross amounts collected on its behalf. At the closing, shareholders and
      note holders of Old Case owned approximately 44% of the then outstanding
      common stock of the Company.

      Upon execution of the Agreement, the existing management of Asia Web
      resigned their positions in favor of the management of Old CFI.

NOTE 3: CONCENTRATIONS

      Cash:

            The Company maintains cash balances at a bank where amounts on
            deposit are in excess of $100,000. Accounts at each institution are
            insured by the Federal Deposit Insurance Corporation up to $100,000.

      Customers:

            As of September 30, 2003, one law firm customer represented
            approximately 25% of the portfolio of investments in contracts and
            approximately 23% of total revenue.


                                       39
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
         For the nine months ended September 30, 2002 and the year ended
                               September 30, 2003

NOTE 4: INVESTMENTS IN CONTRACTS

      Amounts advanced relating to the Company's investments in contracts range
      from 3.5% to 15% of the plaintiff's claims.

      At September 30, 2002 and September 30, 2003, investments in contracts,
      net of allowance for contract losses, were $1,224,199 and $2,265,112,
      respectively. Management reviews each case prior to making an advance.

      The Company records fee income upon receipt of cash after the case is
      settled or adjudicated. Based on historical data, at September 30, 2003,
      the Company estimates that unrecorded fee income on outstanding
      investments in contracts approximates $1,583,000. However, no assurance
      can be given that these amounts will be eventually realized. This estimate
      is based on historical performance and includes a provision for
      settlements at amounts less than contracted fees.

      A summary of the activity in investments in contracts (excluding the
      allowance for contract losses) is as follows:

                                                  September 30,    September 30,
                                                       2002             2003
                                                  -------------    -------------

      Balance at beginning of period               $ 2,352,661      $ 1,453,101
      Retained by Old CFI                           (1,888,644)              --
      New advances                                   2,111,069        3,053,173
      Collections                                     (989,099)      (1,711,460)
      Write-offs due to uncollectibility              (132,886)        (271,413)
                                                   -----------      -----------
      Balance at end of period                     $ 1,453,101      $ 2,523,401
                                                   ===========      ===========

      As of September 30, 2003, the Company has underwritten and committed to
      additional investment in contract case fundings of approximately $612,000
      under credit agreements with attorneys.

NOTE 5: EQUIPMENT

      Equipment consisted of the following as of September 30, 2002 and
      September 30, 2003:

              September 30,   September 30,
                   2002           2003
              -------------  ------------

                $ 58,977        $62,218
                  36,583         40,856
                  83,863         93,708
                ---------       --------
                 179,423        196,782
                  90,674        137,868
                ---------       --------
                $ 88,749        $58,914
                =========       ========


                                       40
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
         For the nine months ended September 30, 2002 and the year ended
                               September 30, 2003


NOTE 6: LOANS PAYABLE, RELATED PARTIES

      Loans payable, related parties, consisted of the following as of September
      30, 2002 and September 30, 2003

<TABLE>
<CAPTION>
                                                                      September 30,  September 30,
                                                                           2002          2003
                                                                      -------------  -------------
<S>                                                                     <C>           <C>
      Notes to stockholders of Old CFI and the Company                  $  285,000    $  470,000
          and another related party, collateralized by
          specifically identified investments in contracts,
          payable upon settlement of the related investments in
          contracts plus either 75% or 50% of the fee income earned
          thereon. Repayment of these notes is contingent upon
          recovery of the specifically identified investments in
          contracts

      Note to a member of the board of directors,
          uncollateralized, payable October 15, 2003 on demand,
          plus interest at 3% per month. (Subsequently paid)                    --        50,000

      Advances from stockholder, uncollateralized, non- interest
          bearing, payable October 15, 2003 on demand
          (Subsequently paid)                                                   --        73,438

      Notes to a member of the board of directors of the Company and
          another related party, uncollateralized, $600,000 payable
          May 23, 2004, and $100,000 payable May 23, 2005 plus
          interest at 8% per annum. (Note 11)                              700,000       700,000

                                                                        ----------    ----------
                                                                        $  985,000    $1,293,438
                                                                        ==========    ==========
</TABLE>

      Interest expense for loans payable - related parties amounted to $269,902
      and $64,562 for the nine months ended September 30, 2002 and the year
      ended September 30, 2003, respectively. Accrued interest on loans payable
      - related parties amounted to $4,667 at September 30, 2002 and 2003.

      Estimated maturities of loans payable, related parties based on
      anticipated settlement of underlying cases during the succeeding two years
      as of September 30, 2003 are approximately $1,193,000 (2004) and $100,000
      (2005).


                                       41
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
         For the nine months ended September 30, 2002 and the year ended
                               September 30, 2003

NOTE 7: LOANS PAYABLE

      Loans payable, other than related parties, consisted of the following as
      of September 30, 2002 and September 30, 2003:

<TABLE>
<CAPTION>
                                                                    September 30,  September 30,
                                                                         2002          2003
                                                                    -------------  -------------
<S>                                                                  <C>            <C>
      Note payable, uncollateralized, interest payable
        monthly at 12.0% per annum, due December 12, 2006 (1)                 --    $2,000,000

      Notes, uncollateralized, convertible at any time into
        common stock at $1.00 per share, including interest at
        9.85% per annum, principal due at
        maturity on September 30, 2005. (1)See below                 $   150,000            --

      Notes payable, uncollateralized, interest payable
        monthly at 12.0% per annum, due January 1, 2007                       --    $  200,000

      Notes, collateralized by specifically identified
        investments in contracts, payable upon settlement of the
        related investments in contracts plus either 75% or 50%
        of the fee income earned thereon. Repayment of these
        notes is contingent upon recovery of the specifically
        identified investments in contracts                                   --       870,000

      Funding agreement through July 31, 2008 under which the
        Company may utilize up to 1,000,000, collateralized by
        specifically identified investments in contracts, payable
        upon settlement of the related investments in contracts
        plus a portion of the fee income earned theron calculated
        in accordance with the terms of the agreement. Investor
        Advances - uncollateralized, repayable on demand
        without interest                                                      --       893,406

      Investor advances - uncollateralized, repayable on
        demand without interest                                               --         2,674
                                                                    -------------  -------------
                                                                     $   150,000    $3,966,080
                                                                    =============  =============
</TABLE>

(1)   Subsequent to year end, the Company was late making interest payments on
      this loan. The terms of the loan agreement allow the Company to be late
      five times before default. The note will be in default and can be called
      by the lender on the sixth late payment. Since the Company has been late
      in making payments less than five times, the Company is currently in
      compliance with the loan covenants under this agreement.



                                       42
<PAGE>

                     CASE FINANCIAL, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
        For the nine months ended September 30, 2002 and the year ended
                               September 30, 2003

NOTE 7: LOANS PAYABLE (Continued)

      Estimated maturities of loans payable based on anticipated settlement of
      underlying cases during the succeeding four years as of September 30, 2003
      are approximately $873,000 (2004); $2,200,000 (2007); and $893,000 (2008).

      (1) Effective January 1, 2003, two accredited investors converted their
      investment in the Company by exchanging three year, 9.85% per annum
      promissory notes amounting to $150,000 for four year, 12% per annum
      promissory notes issued by the Company. The principal amount of these
      promissory notes was $150,000. There was an additional investment of
      $50,000 under the same terms by another investor.

NOTE 8: CONTINGENCIES

      Asia Web and some of its former officers and directors, Michael Schaffer,
      Larry Schaffer and Waddy Stephenson, filed a complaint in the Superior
      Court of the County of San Diego on January 16, 2002 against a law firm
      and several individuals affiliated with the law firm. The law firm
      provided legal services to Asia Web. The lawsuit was settled in April 2003
      and the Company received approximately $175,000, net of direct litigation
      expenses, contingency attorney fees, and $55,562 shared with Michael
      Schaffer.

      The Company is a nominal defendant in a shareholders' derivative action
      filed in the Superior Court of the State of California for the County of
      San Diego. The plaintiffs, as shareholders of Asia Web before the merger,
      have sued the individual defendants, former officers including Michael
      Schaffer, alleging that they converted to personal use certain corporate
      assets and are seeking to have the individual defendants return the assets
      to the Company. The Company is a "nominal" defendant and no relief is
      being sought against the Company in this action. As a result of the
      lawsuit, a dispute arose between the Company and a former officer, Michael
      Schaffer, with respect to Mr. Schaffer's claim for indemnification for
      legal fees incurred in defending himself in the lawsuit. The Company
      entered into a settlement agreement with Mr. Schaffer on June 25, 2003
      whereby the Company agreed to: (i) grant 18 month options to Mr. Schaffer
      to purchase 250,000 shares of common stock at an exercise price of $0.30
      only if the market price for the Company's common stock exceeds $0.65 for
      two consecutive trading days, and (ii) pay $70,000 in cash with monthly
      payments of $10,000 commencing October 2003.


                                       43
<PAGE>

                     CASE FINANCIAL, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
        For the nine months ended September 30, 2002 and the year ended
                               September 30, 2003

NOTE 9: TAXES ON INCOME

      As of September 30, 2003, the Company had available federal and state net
      operating loss carryforwards amounting to approximately $7,700,000 and
      $7,100,000, respectively, that may be applied against future federal and
      state taxable income and that expire in 2023 for federal tax purposes and
      2009 for state tax purposes. A substantial portion of these net operating
      loss carryforwards may be limited due to the change of ownership.

      Temporary differences giving rise to net deferred tax assets consist
      primarily of the net operating losses and the allowance for contract
      losses. Since the Company cannot determine if it is more likely than not
      that the net deferred tax assets will be realized, the deferred tax assets
      recognized are fully offset by a valuation allowance.

NOTE 10: STOCKHOLDERS' EQUITY (DEFICIENCY)

      Common stock:

            During the nine months ended September 30, 2002, the Company issued
            1,825,000 shares of common stock valued at $875,350, their fair
            market value, to management, certain directors, and consultants of
            the Company (Note 11). Of the 1,825,000 shares approved by the board
            of directors for issuance, 1,350,000 vested between March 15 and May
            24, 2002, the closing date of the reverse acquisition, and 475,000
            shares are subject to pro-rata return upon management resignation or
            termination with cause over three years.

      Stock options:

            In connection with the reverse acquisition, the board of directors
            approved the grant on May 24, 2002 of options to purchase 1,250,000
            common shares at an exercise price of $0.45 per share, the fair
            value, to certain members of management and directors. The fair
            value of these options was $100,000. The options vest over a period
            of three years, generally from the date of grant.

            In addition, during the nine months ended September 30, 2002, the
            board of directors approved grants of options to purchase 550,000
            common shares at an exercise price of $0.45 per share to certain
            members of management. The fair value of these options was $40,000.
            The options vest over a period of three years, generally from the
            date of grant. On January 31, 2003, 375,000 of these option shares
            were cancelled.

            The Company also has outstanding options to acquire 300,000 common
            shares at $.45 which are fully vested and expire June 1, 2006. These
            options were granted by Asia Web prior to the reverse acquisition.


                                       44
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
         For the nine months ended September 30, 2002 and the year ended
                               September 30, 2003

            During the year ended September 30, 2003, the board of directors
            approved grants of options to purchase 1,790,000 shares at exercise
            prices ranging from $0.20 to $0.65 to employees, consultants,
            certain members of management and the board of directors. The fair
            value of these options was approximately $85,000. The options
            generally vest over three years.

            The total stock options outstanding at September 30, 2003 aggregated
            3,515,000 shares, at a weighted average exercise price of $0.33 per
            option, expiring as follows:

                  Year                                              Shares
                  ----                                              ------
                  2005                                              250,000
                  2006                                              300,000
                  2007                                              125,000
                  2008                                              490,000
                  2009                                              550,000
                  2010                                            1,100,000
                  2011                                              700,000
                                                                  ---------
                                                                  3,515,000
                                                                  =========

            The balance of stock options exercisable at September 30, 2003
            amounted to approximately 1,856,000 options, at a weighted average
            exercise price of $0.37 per option, expiring as follows:

                  Year                                             Shares

                  2005                                              250,000
                  2006                                              300,000
                  2007                                              125,000
                  2008                                              490,000
                  2009                                              178,000
                  2010                                              488,000
                  2011                                               25,000
                                                                  ---------
                                                                  1,856,000
                                                                  =========

            The weighted average remaining contractual life for the outstanding
            options is 6 years, and for exercisable options is approximately 5
            years.


                                       45
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
         For the nine months ended September 30, 2002 and the year ended
                               September 30, 2003

      Warrants:

            As of September 30, 2002, the Company had warrants outstanding to
            non-employees for the purchase of 1,975,000 of the Company's common
            stock at $3.00 per share expiring on July 31, 2004. These warrants
            were issued in connection with the 1999 financing of Asia Web prior
            to the reverse acquisition.

            During the nine months ended September 30, 2002, the Company granted
            warrants to non-employees to purchase 75,000 shares of the Company's
            common stock at $.60 per share expiring September 30, 2005 in
            connection with a private placement of $150,000 in 9.85% convertible
            subordinated notes (Note 7).

            On December 6, 2002 the Company granted warrants to non-employees to
            purchase 25,000 shares of the Company's common stock at $.60 per
            share expiring December 6, 2005 in connection with a private
            placement of $50,000 in 9.85% convertible subordinated notes (Note
            7).

            On December 12, 2002, the Company granted warrants to non-employees
            to purchase 3,000,000 of the Company's common stock, 2,000,000 at
            $0.50 per share, and 1,000,000 at $0.80 per share expiring December
            12, 2006 in connection with a private placement of $2,000,000 in
            unsecured note payable. The Company is obligated to register the
            common shares underlying these warrants for resale (Note 7).

            On December 12, 2002, the company granted warrants to non-employees
            to purchase 200,000 of the Company's common stock at $.50 per share
            expiring December 12, 2006 in connection with a private placement of
            $2,000,000 in unsecured note payable (Note 7).

            On January 1, 2003, the Company converted $200,000 in 9.85%
            uncollateralized four year notes payable for new 12% notes payable
            (Note 7). In connection therewith, 100,000 four year warrants at an
            exercise price $0.60 per share originally issued in connection with
            the issuance of the notes were cancelled, and 300,000 new four year
            warrants were issued, 200,000 exercisable at $0.50 per share, and
            100,000 at $0.80 per share. The Company is obligated to register the
            common shares underlying these warrants for resale.

            The balance of warrants outstanding and exercisable at September 30,
            2003 amounted to 5,475,000 warrants, at a weighted average exercise
            price of $1.46 per warrant, expiring 1,975,000 (2004) and 3,500,000
            (2007). The weighted average remaining contractual life for the
            warrants is approximately 3 years.

      Merger costs:

            Merger costs include investment banking fees, legal, accounting, and
            consulting costs directly related to the reverse acquisition of Asia
            Web (Note 2).


                                       46
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
         For the nine months ended September 30, 2002 and the year ended
                               September 30, 2003

NOTE 11: RELATED PARTY TRANSACTIONS

      During the nine months ended September 30, 2002, the Company acquired from
      a director and a related party 100% of the members' interest in Case
      Financial, LLC for 150,000 common shares valued at $67,500 and $700,000 in
      notes payable. The difference between the basis of the members' interest
      at the time of the transaction, $540,000, and the value of the common
      stock and notes payable exchanged, $767,500, amounted to $227,500 and is
      accounted for as a premium paid in the acquisition. These costs are being
      amortized to interest expense on the straight-line method over three
      years, the term of the related debt. During the nine months ended
      September 30, 2002, and year ended September 30, 2003, approximately
      $25,000 and $76,000 respectively of these costs were amortized to interest
      expense. The unamortized portion of this premium amounted to approximately
      $127,000 at September 30, 2003 and is included in receivables and other
      assets, related parties.

      At September 30, 2002 and 2003, receivables and other assets, related
      parties include approximately $43,000 advanced by Case Financial, LLC to
      Old CFI prior to the merger. This advance is due on demand. At September
      30, 2003, the advance was fully offset by an impairment allowance.

      During the nine months ended September 30, 2002, and year ended September
      30, 2003, the Company recognized $100,262 and $59,519, respectively, in
      service fees from Old CFI and subsidiary pursuant to a service agreement
      entered into in connection with the reverse acquisition.

      Service fees receivable amounted to approximately $8,900 at September 30,
      2003 and are included in receivables and other assets, related parties. At
      September 30, 2003, this receivable was fully offset by an impairment
      allowance.

      During the nine months ended September 30, 2002 and the year ended
      September 30, 2003, related parties advanced $287,500 and $913,500,
      respectively, to the Company for investment in contracts as third party
      participations, and the Company returned $10,000 and $674,000,
      respectively, in principal to related parties upon successful case
      resolutions.

      As of September 30, 2002 and 2003, $834,481 and $833,209, respectively,
      was due from Old CFI under notes receivable which are due on demand and
      accrue interest at 12 to 18 percent per annum. During the nine months
      ended September 30, 2002, the Company recognized approximately $39,000 of
      interest from these notes receivable. No interest was recognized from
      these receivables during the year ended September 30, 2003. Accrued
      interest receivable from this affiliate amounted to approximately $79,000
      at September 30, 2002 and 2003 and is included in receivables and other
      assets, related parties. As of September 30, 2003, this receivable was
      fully offset by an impairment allowance. Furthermore, all but $23,000
      principal amount of the notes are unsecured and subordinated to $2,200,000
      of secured indebtedness of Old CFI. The ability of Old CFI to service and
      retire the notes held by the Company is conditioned upon two primary
      factors: i) the collectibility of the portfolio of investments of Old CFI
      retained by Old CFI, and ii) the value of the Company's common stock,
      valued at $0.15 per share during January 2004 ($0.44 at September 30,
      2002), held by Old CFI. In connection with the Company's obligation to
      manage the Old CFI portfolio, it regularly reviews the collectibility of
      each investment in the portfolio. As a result of the most current review,
      management of the Company believes that an increase in the estimate of
      future contract losses of the Old CFI portfolio is appropriate. As such,
      the Company's estimate of the fair value of the assets of


                                       47
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
         For the nine months ended September 30, 2002 and the year ended
                               September 30, 2003

      Old CFI would be insufficient to retire all of its indebtedness, including
      the notes and the other receivables held by the Company, and therefore
      identified an impairment loss of $175,000 and $766,431 in the years ended
      September 30, 2002 and 2003, respectively, in those notes and other
      receivables.

      During the nine months ended September 30, 2002, the Company issued
      480,000 shares of its common stock valued at $216,000 as an investment
      banking fee in connection with the closing of the reverse acquisition to a
      company wholly owned by a director of the Company.

NOTE 12: MERGER COMPENSATION COSTS

      On May 24, 2002, the Company incurred stock based merger compensation
      costs of $607,500 in connection with the reverse acquisition resulting
      from approval by the Company's board of directors to grant 1,825,000
      common shares to new management and directors, 1,350,000 of which vest
      immediately, and 475,000 which are subject to return to the Company in the
      event the executive terminates employment within 36 months of the grant.
      The number of shares subject to return is reduced by 1/36 for each month
      of continued employment. In addition, the Company agreed to pay the income
      tax withholding on behalf of the officers receiving the stock grants, and
      at September 30, 2002 had accrued bonuses of $165,000 for such purpose.
      The share distribution and income tax payments were made on December 30,
      2002.

NOTE 13: SUBSEQUENT EVENTS

      Loans:

      Subsequent to September 30, 2003, an officer and two directors loaned
      $260,000 to the Company payable on demand including interest at 12% per
      annum.

NOTE 14: GOING CONCERN

      The accompanying financial statements have been prepared in conformity
      with accounting principles generally accepted in the United States of
      America, which contemplates continuation of the Company as a going
      concern. However, the Company incurred net losses of $3,127,190 and
      $2,289,036 during the year and nine months ended September 30, 2003 and
      2002, respectively, there was an accumulated deficit of $9,865,720 as of
      September 30, 2003, total liabilities exceed total assets by $1,962,102 as
      of September 30, 2003, and the Company has been experiencing cash flow
      problems. Those conditions raise substantial doubt about the Company's
      ability to continue as a going concern. The financial statements do not
      include any adjustments that might result from the outcome of this
      uncertainty.


                                       48
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
         For the nine months ended September 30, 2002 and the year ended
                               September 30, 2003

      Management has acted to reduce overhead and increase revenues. The Company
      reduced its overhead in operations sales and marketing to reflect the
      current funding ability of the Company. The overhead reduction was
      achieved by reducing personnel, and the completion of the development of
      the L.E.G. and Short Term Loan programs. The completion of these
      developments will reduce the Company's consulting expenses for accountants
      and attorneys. Management has also shifted available funding to the Short
      Term Loan program in order to reduce the length of the funding cycle and
      realize profits faster. The Company has had increasing success in
      attracting third party investments to its Short Term Loan program.
      Management believes that it can attract additional funds to the Short Term
      Loan program. Management is also continuing its general fund raising
      activities, which includes pursuing additional debt and equity investments
      and joint venture participations with institutional and accredited
      investors.

      Management believes that actions presently being taken or to be taken to
      revise the Company's operating and financial requirements provide the
      opportunity for the Company to continue as a going concern.


                                       49
<PAGE>

Item 8. Changes in and Disagreements With Accountants on Accounting and
Financial Disclosure.

Not applicable.

Item 8A. Controls and Procedures.

a) Evaluation of disclosure controls and procedures: As of September 30, 2003,
the end of the period covered by this report, the Company's chief executive
officer and its chief financial officer reviewed and evaluated the effectiveness
of the Company's disclosure controls and procedures (as defined in Exchange Act
Rule 13a-15(e) and 15d-15(e)), which are designed to ensure that material
information the Company must disclose in its report filed or submitted under the
Securities Exchange Act of 1934, as amended (the "Exchange Act") is recorded,
processed, summarized, and reported on a timely basis, and have concluded, based
on that evaluation, that as of such date, the Company's disclosure controls and
procedures were effective to ensure that information required to be disclosed by
the Company in reports that it files or submits under the Exchange Act is
accumulated and communicated to the Company's chief executive officer and chief
financial officer as appropriate to allow timely decisions regarding required
disclosure.

(b) Changes in internal control over financial reporting: In the three months
ended, September 30, 2003, there has been no change in the Company's internal
control over financial reporting that has materially affected, or is reasonably
likely to materially affect, its internal control over financial reporting.


                                       50
<PAGE>

                                    PART III

Item 9. Directors, and Executive Officers of the Registrant.

--------------------------------------------------------------------------------
      Name                             Position                              Age
--------------------------------------------------------------------------------
Eric A. Alden         Co-Chairman, President and Chief Executive Officer     43
--------------------------------------------------------------------------------
Steve D. Gershick     Acting Chief Financial Officer                         48
--------------------------------------------------------------------------------
Lorne M. Pollock      Secretary, Vice President Underwriting and Director    38
--------------------------------------------------------------------------------
Gary L. Primes        Vice President Information Systems and Director        44
--------------------------------------------------------------------------------
James Lewis           Vice President Sales                                   45
--------------------------------------------------------------------------------
Gordon Gregory        Director                                               50
--------------------------------------------------------------------------------
Steven A. Fuld        Director (Deceased October, 2003)
--------------------------------------------------------------------------------
Harvey Bibicoff       Director                                               63
--------------------------------------------------------------------------------
Bernard Christophe    Director                                               67
--------------------------------------------------------------------------------

      Eric A. Alden, CPA, co-founded Case Financial, Inc. in 1998 and has served
as Chief Executive Officer and Co-Chairman of the Company since March 2002. From
1997 - 1998, Mr. Alden served as acting Chief Financial Officer of Puritan
Quartz, Inc., a turnaround situation where he provided financial management and
business planning services. From 1995 - 1996 he helped managed the turn-around
of another financially distressed company, Creative Presentations, Inc., where
he helped guide the company through reorganization with an emphasis on creating
profitable divisions. Mr. Alden is a Certified Public Accountant. He holds a
Bachelor of Science degree in Business and Accounting from California State
University, Northridge. Mr. Alden served in the Israeli Navy as a P.T. boat
commander and first officer on a missile ship during the Lebanon War.

      Steven D. Gershick, CPA, has served as Acting Chief Financial Officer from
August 2003 to December 2003 on a consulting basis. From August 2002 through
January 2003, Mr. Gershick was Chief Financial Officer. From April to August
2002, Mr. Gershick was a consultant to the Company. From October 1998 to August
2002 Mr. Gershick provided business planning and corporate finance consultancy
services to several early stage and venture backed companies. From July 1992
(formation) to September 1998, Mr. Gershick was President and Chief Executive
Officer of Spatializer Audio Laboratories, Inc., a publicly held corporation
listed on the Nasdaq Small Cap. Mr. Gershick is a Certified Public Accountant
and graduated Summa Cum Laude with a Bachelor of Science degree in Accounting
from California State University, Northridge.

      Lorne M. Pollock, Esq., has served as a Director of the Company since May
2002, Secretary since June 2000 and Vice President Underwriting since June 2000.
Prior to joining the Company, Mr. Pollock was a practicing attorney specializing
in liability litigation for Wilson, Elser, Moskowitz, Edelman & Dicker from 1994
- 2000. Mr. Pollock graduated Magna Cum Laude with a Bachelor of Arts degree
from McGill University, Montreal, Quebec, and he earned a Bachelor of Laws
degree from Osgoode Hall Law School, Toronto, Canada. Mr. Pollock was admitted
to the State Bar of California in 1992 and is licensed to practice before all
state courts and the United States District Court for Central District of
California.

      Gary L. Primes, has served as a Director since May 2002 and Vice President
Information Systems since August, 2002. He provided independent business
operations and information technology consulting services to the Company from
October 2000 to August 2002. From June 1999 to August, 2002, Mr. Primes operated
H.E.L.P. Technologies as an independent business operations consultancy. From
1994 to 1999 he served as General Manager for Puritan-Quartz Pharmaceuticals.
Mr. Primes graduated with honors with a five-year Professional Bachelor of
Architecture degree from California Polytechnic State University, San Luis
Obispo.


                                       51
<PAGE>

      James R. Lewis joined the Company in April 1999 and has served as Vice
President Sales since April 2001. From January to April 1999 he served as Vice
President, Finance for the Mars Colony and from 1994 - 1999 Mr. Lewis was
principal of Jonah International, providing research and business development
services. Mr. Lewis is a candidate for Bachelor of Science, Finance and
candidate for Bachelor of Arts, Communications from Regents College.

      Gordon Gregory has served as Co-Chairman of the Company since May 2002.
Since 1989, Mr. Gregory has served Chairman and Managing Director of the
investment banking firms Mosaic Capital LLC, affiliate Mosaic Capital Securities
LLC and its predecessor company. Mr. Gregory earned a Bachelor of Arts degree in
Economics from the University of Southern California, an MBA in Finance from the
University of California, Berkeley and a Juris Doctorate from the University of
California, Hastings College of the Law.

      Harvey Bibicoff has served as a Director of the Company since May 2002.
Since 1981, he has served as Chairman of the Board of Directors and Chief
Executive Officer of Bibicoff & Associates, Inc., consultants to publicly held
companies for corporate marketing/strategic planning. From August 1991 through
August 1997, Mr. Bibicoff served as Chairman of the Board of Directors of
publicly held Harmony Holdings, Inc. He also served as Chief Executive Officer
of Harmony Holdings from May 1996 - August 1997. Mr. Bibicoff received a
Bachelor of Science degree Business and Finance from Bowling Green State
University and he earned a Juris Doctorate degree from Columbia University
School of Law in 1963 and was admitted to the practice of law in New York State
that same year.

      Steven A. Fuld has served as a Director of the Company from May 2002
through the date of his death on October, 2003. Mr. Fuld was a principal of The
Skyline Group, a financial services firm he founded in 1985. He was also a
principal of Creative Capital, Inc./The Skyline Group, the structured
settlements division of the Skyline Group. Mr. Fuld did his undergraduate work
in Finance and Insurance at California State University, Northridge. He earned
the Chartered Life Underwriter and Chartered Financial Consultant designations
from The American College in Bryn Mawr, Pennsylvania. Mr. Fuld also earned the
Accredited Estate Planner designation from the National Association of Estate
Planners and Councils.

      Bernard Christophe has served as a Director since April 2003. He was
President and Chief Executive Officer of the United Food and Commercial Workers,
Local 832 in Winnipeg, Canada from January 1964 to September 2002. Mr.
Christophe serves as a director of the International Foundation of Employee
Benefit Plans and served as chairman of the Canadian board from January 2001 to
January 2002. He is also chairman of the board of directors of Canadian Union
Advantage Benefit Programs. He is a member of the of the minimum wage board of
the Province of Manitoba, vice-chair of the Manitoba Liquor Commission. Mr.
Christophe graduated with great distinction from the Labour College of Canada.

Compliance with Section 16(a) of the Act

      The members of the Board of Directors, certain executive officers of the
Company and persons who hold more than 10% of the Company's outstanding common
stock are subject to the reporting requirements of Section 16(a) of the Exchange
Act which require them to file reports with respect to their ownership of common
stock and their transactions in common stock. Based upon the copies of Section
16(a) reports that the Company received from such persons for their 2002 fiscal
year transactions in the common stock and their common stock holdings, the
Company believes that the reporting requirements under Section 16(a) for such
fiscal year were not met in a timely manner by certain of its executive
officers, Board members and greater than ten-percent stockholders. The following
schedule contains the required information for the last fiscal year:


                                       52
<PAGE>

--------------------------------------------------------------------------------
                        Number of      Number of transactions      Number of
      Name            late reports      not reported on time    Failures to file
--------------------------------------------------------------------------------
Lorne Pollock               1                    1                    --
--------------------------------------------------------------------------------
Gary Primes                 1                    1                    --
--------------------------------------------------------------------------------
James Lewis                 1                    1                    --
--------------------------------------------------------------------------------
Steve Gershick              1                    1                    --
--------------------------------------------------------------------------------
Steven Fuld                 1                    1                    --
--------------------------------------------------------------------------------
Harvey Bibicoff             1                    1                    --
--------------------------------------------------------------------------------
Gordon Gregory              1                    1                    --
--------------------------------------------------------------------------------
Eric Alden                 --                   --                    --
--------------------------------------------------------------------------------
Bernard Christophe          1                    1                    --
--------------------------------------------------------------------------------

Code of Ethics

      We have not adopted a code of ethics that applies to our principal
executive officer, principal financial officer, principal accounting officer or
controller, or persons performing similar functions. We are in the process of
reviewing a code of ethics with our attorneys and the independent board members
and will adopt one upon completion of discussions.

Item 10. Executive Compensation

      The following Summary Compensation Table sets forth the compensation
earned by the Company's Chief Executive Officer and the three other most highly
compensated executive officers who were serving as such as of September 30, 2003
(collectively, the "Named Executive Officers"), each of whose aggregate
compensation for fiscal year 2003 exceeded $100,000 for services rendered in all
capacities to the Company and its subsidiaries for that fiscal year.

Summary Compensation Table

<TABLE>
<CAPTION>
                                                                  Long Term
                             Annual Compensation             Compensation Awards
                             --------------------      --------------------------------
                                                                        Shares of
                                                           Other       Common Stock
  Name               Year     Salary        Bonus      Compensation  Underlying Options
  ----               ----     ------        -----      ------------  ------------------
<S>                  <C>     <C>         <C>            <C>             <C>
Eric Alden           2003    $120,000    $     --       $ 43,750(5)     175,000(3)
                     2002    $ 84,050    $ 90,132(1)    $346,546(2)      87,500(3)
                     2001    $117,500          --             --             --
James Lewis          2003    $ 80,000          --             --        125,000(3)
                     2002    $ 77,796    $ 23,453(1)    $ 66,000(4)
                     2001    $ 68,612                         --         25,000(3)
Steve Gershick       2003    $168,095          --             --         66,666(3)
                     2002    $ 50,463          --             --         83,334(3)
Lorne Pollock        2003    $ 64,000          --              ~        100,000(3)
                     2002    $ 90,000    $ 15,160(1)    $ 44,000(4)      16,667(3)
                     2001                                     --
Gary Primes          2003    $ 96,667          --             --        158,333(3)
                     2002    $ 54,188    $ 18,055(1)    $ 44,000(4)      16,667(3)
                     2001    $ 28,100          --             --             --
</TABLE>

----------
(1)   Reimbursement for income taxes payable with respect to stock grants.
(2)   Represents the product of 787,500 shares of restricted stock that vested
      at September 30, 2002 times the closing price of $0.44 at September 30,
      2002
(3)   Reflects the vested portion of options to purchase shares of common stock
      of the Company.
(4)   Represents the product of 150,000 shares of restricted stock that vested
      at September 30, 2002 times the closing price of $0.44 at September 30,
      2002
(5)   Represents the product of 175,000 shares of restricted stock that vested
      at September 30, 2003 times the closing price of $0.25 at September 30,
      2003

Option Grants in Last Fiscal Year

<TABLE>
<CAPTION>
                      Number of      Percent of Total
                      Securities      Options Granted                   Market
                      Underlying       to Employees     Exercise or    Price on   Expiration
       Name        Options Granted    In Fiscal Year    Base Price    Grant Date     Date
       ----        ---------------    --------------    ----------    ----------     ----
<S>                    <C>                 <C>             <C>           <C>       <C>
Gary Primes            400,000              40%            $0.20         $0.20     9/03/08
James Lewis             50,000               5%            $0.20         $0.20     9/03/08
Lorne Pollock           50,000               5%            $0.20         $0.20     9/03/08
Steve  Gershick         25,000             2.5%            $0.20         $0.20      9/3/08
</TABLE>

Aggregated Option Exercised in Last Fiscal Year and Year End Option Holdings

<TABLE>
<CAPTION>
                   Shares               Number of Securities Under-       Value of Unexercised
                  Acquired               Lying Unexercised Options      In-The-Money Options(1)
                     On       Value     ---------------------------    ---------------------------
      Name        Exercise   Realized   Exercisable   Unexercisable    Exercisable   Unexercisable
      ----        --------   --------   -----------   -------------    -----------   -------------
<S>                  <C>        <C>       <C>            <C>                <C>           <C>
Eric Alden           --         --        233,333        291,667            --            --
James Lewis          --         --        150,000        125,000            --            --
Gary Primes          --         --        175,000        375,000            --            --
Lorne Pollock        --         --        116,667         83,333            --            --
Steve Gershick       --         --        150,000             --            --            --
</TABLE>

----------
(1)   Based on the closing price of $0.25 at September 30, 2003.

Employment Agreements

      We entered into an employment agreement with the Acting Chief Financial
Officer, Steven D. Gershick on August 19, 2002, which we terminated on January
31, 2003. Pursuant to the employment agreement, we made a grant of stock options
to Mr. Gershick to purchase 500,000 shares of common stock at an exercise price
of $0.45 per share. As of January 31, 2003, 125,000 shares had vested. The
options expire on April 16, 2007 unless extended or cancelled by us in writing.
In addition, we paid Mr. Gershick severance of $36,000 for three months base
salary pursuant to the agreement. Effective February 1, 2003, Mr. Gershick
changed from full time to consulting status and acted as the Acting Chief
Financial Officer on an interim basis. We have not entered into a written
consulting agreement with Mr. Gershick. As of December 26, 2003 Mr. Gershick is
no longer with the Company.


                                       53
<PAGE>

      We entered into a two year employment agreement with the Vice-President
Underwriting, Lorne M. Pollock. The agreement expires August 15, 2004. Under the
employment agreement, we will pay Mr. Pollock a base salary of $90,000 per year
with annual increases based on the cost of living index. Subject to Board
discretion, we may pay Mr. Pollock a bonus not to exceed $30,000. We also made a
grant of restricted stock to Mr. Pollock in the amount of 100,000 shares of
common stock. In addition, we also made a grant of stock options to Mr. Pollock
to purchase 150,000 shares of common stock at an exercise price of $0.45 per
share. The options vest monthly over 36 months and expire 10 years from the date
of grant. The employment agreement contains non-competition provisions relating
to trade secrets, inventions and non-solicitation. We may terminate Mr. Pollock
with and without cause. If we terminate Mr. Pollock without cause, we must
continue to pay Mr. Pollock his base salary then in effect for the remainder of
the term and his options will continue to vest. If we terminate Mr. Pollock for
cause, we must only pay Mr. Pollock the base salary then in effect for the 30
day notice period and any unvested options shall terminate upon the termination
date.

      We have entered into a two year employment agreement with the
Vice-President Sales and Marketing, James R. Lewis. The agreement expires August
15, 2004. Under the employment agreement, we will pay Mr. Lewis a base salary of
$80,000 per year with annual increases based on the cost of living index.
Subject to Board discretion, we may pay Mr. Lewis a bonus not to exceed $50,000.
We also made a grant of restricted stock to Mr. Lewis in the amount of 150,000
shares of common stock. We also made a grant of stock options to Mr. Lewis to
purchase 225,000 shares of common stock at an exercise price of $0.45 per share.
The options vest monthly over 36 months and expire 10 years from the date of
grant. The employment agreement contains non-competition provisions relating to
trade secrets, inventions and non-solicitation. We may terminate Mr. Lewis with
and without cause. If we terminate Mr. Lewis without cause, we must continue to
pay Mr. Lewis his base salary then in effect for the remainder of the term and
his options will continue to vest. If we terminate Mr. Lewis for cause, we must
only pay Mr. Lewis the base salary then in effect for the 30-day notice period
and any unvested options shall terminate upon the termination date.

      We have entered into a two year employment agreement with the Chief
Information Officer and Vice-President Operations, Gary L. Primes. The agreement
expires August 15, 2004. Under the employment agreement, we must pay Mr. Primes
a base salary of $90,000 per year with annual increases based on the cost of
living index. Subject to Board discretion, we may pay Mr. Primes a bonus not to
exceed $30,000. We also made a grant of restricted stock to Mr. Primes in the
amount of 100,000 shares of common stock. In addition, we made a grant of stock
options to Mr. Primes to purchase 150,000 shares of common stock at an exercise
price of $0.45 per share. The options vest monthly over 36 months and expire 10
years from the date of grant. The employment agreement contains non-competition
provisions relating to trade secrets, inventions and non-solicitation. We may
terminate Mr. Primes with and without cause. If we terminate Mr. Primes without
cause, we must continue to pay Mr. Primes his base salary then in effect for the
remainder of the term and his options will continue to vest. If we terminate Mr.
Primes for cause, we must only pay Mr. Primes the base salary then in effect for
the 30-day notice period and any unvested options shall terminate upon the
termination date.

COMPENSATION OF DIRECTORS

      Our directors receive an initial option grant of 50,000 common shares
which vest over the 12 months following the grants. The Board of Directors may
grant additional options in subsequent years. In addition, each director is
reimbursed for reasonable out-of-pocket expenses incurred in connection with
attendance at Board and committee meetings.

      On April 8, 2003, the Board of Directors authorized a grant of 50,000
shares to Bernard Christophe for compensation as a director. The options vest
monthly over 12 months, expire 6 years from the date of grant and are
exercisable at $0.45 per share.


                                       54
<PAGE>

      On September 3, 2003 the Board of Directors granted options to the persons
named below, as Director's compensation for the 12 months ending May 31, 2004
The options vest as follow : 10,000 options per board meeting not to exceed
40,000 and the rest vest monthly over 12 months starting June 1, 2003.

          ---------------------------------------------------------
                 NAME                             NUMBER OF SHARES
                                                 UNDERLYING OPTIONS
          ---------------------------------------------------------
            Gordon Gregory                            200,000
          ---------------------------------------------------------
           Harvey Bibicoff                            100,000
          ---------------------------------------------------------
            Steven A. Fuld                            100,000
          ---------------------------------------------------------
          Bernard Christophe                          100,000
          ---------------------------------------------------------

Item 11. Security Ownership of Certain Beneficial Owners and Management and
Related Stockholder Matters

      The following table sets forth certain information as of November 30, 2003
with respect to beneficial ownership of the outstanding shares of common stock
of the Registrant by the Registrant's directors, executive officers and each
person known by the Registrant to own in excess of 5% of the outstanding shares
of common stock of the Registrant, and the directors and executive officers as a
group. Unless otherwise specified, the address of all listed persons is 15060
Ventura Blvd, Suite 240, Sherman Oaks, CA 91403. Beneficial ownership is
determined in accordance with the SEC Rule 13d-3 and generally includes shares
over which the holder has voting or investment power, subject to community
property laws. All shares of common stock obtainable upon conversion of
securities or exercise of stock options or warrants (including those that are
not currently exercisable but will become exercisable within 60 days hereafter)
are considered to be beneficially owned by the person holding the options or
warrants for computing that person's percentage, but are not treated as
outstanding for computing the percentage of any other person. Unless otherwise
specified, each person below has personal and sole beneficial ownership of the
shares of common stock:

<TABLE>
<CAPTION>
                                                                       Percentage of
  Name of Beneficial Owner                             No. of Shares    Ownership(1)
  ------------------------                             -------------    ------------
<S>                                                      <C>                <C>
Eric A. Alden                                            1,487,500          9.4%
Steven D. Gershick                                         150,000         0.95%
Lorne Pollock                                              225,000         1.43%
Gordon Gregory                                             888,000         5.63%
Harvey Bibicoff                                            345,000         2.20%
Gary Primes                                                300,000          1.9%
Steven Fuld                                                316,000         2.02%
Jim Lewis                                                  312,500         1.99%
Bernard Christophe                                          73,333         0.47%
Directors and Executive Officers as a group (8
persons )                                                3,947,333        23.31%

Canadian Commercial Workers Industry                     4,040,750(11)    21.06%
Pension Plan
125 Queens Plate Drive, Ste. 220 Etobicoke,
Ontario M9W 6V1

Old CFI, Inc.                                            2,620,000(12)    16.84%
15060 Ventura Boulevard, Suite 240
Sherman Oaks, CA 91403
</TABLE>

----------
1.    Percentage of ownership is calculated based on 15,561,108 shares
      outstanding at December 15, 2003. The number of shares outstanding on such
      date for which certificates had been issued was 13,736,108. An additional
      1,825,000 shares were considered outstanding on that date, but the
      certificates had not yet been issued and the shares were not carried on
      the records of the stock transfer agent.


                                       55
<PAGE>

2.    Includes 262,500 shares underlying stock options.
3.    Includes 150,000 shares underlying stock options.
4.    Includes 125,000 shares underlying stock options.
5.    Includes 200,000 shares underlying stock options.
6.    Includes 100,000 shares underlying stock options.
7.    Includes 200,000 shares underlying stock options.
8.    Includes 100,000 shares underlying stock options.
9.    Includes 162,500 shares underlying stock options.
10.   Includes 73,333 shares underlying stock options.
11.   Includes 401,389 shares underlying stock options.
12.   Includes 625,000 shares underlying warrants owned by this entity and
      3,000,000 shares underlying warrants owned by I, F, Propco Holdings
      (Ontario) 32, Ltd., a wholly owned subsidiary of this entity.
13.   Messrs. Alden and Bibicoff, directors of the Company, are also directors
      of this entity.

Item 12. Certain Relationships and Related Transactions

      In May 2002, we acquired from Harvey Bibicoff, a shareholder and director
of the Company, and Ruben Kitay, a shareholder of Old CFI and the step-parent of
Eric Alden, our Chief Executive Officer and director, all of such person's
interests in Case Financial, LLC in exchange for 150,000 shares of Company
common stock and promissory notes. We issued promissory notes in the following
amounts: Harvey Bibicoff, and Ruben Kitay, $600,000 and $100,000, respectively.
The notes bear interest at the rate of 8% per annum payable monthly and are due
on May 24, 2004 and May 23, 2005, respectively.

      In May 2002, in connection with the asset purchase agreement, we issued
480,000 shares of common stock to Mosaic Capital, LLC on behalf of Old CFI in
exchange for certain investment banking services. Gordon Gregory, the
Co-Chairman of the Company, owns all of the membership interests in Mosaic
Capital.

      From August to September 2002, we entered into split-funding agreements
with the following persons in the following amounts: Harvey Bibicoff, a
shareholder and director of the Company and shareholder and director of Old CFI,
and Ruben Kitay, a shareholder of Old CFI and step-parent of Eric Alden, our
Chief Executive Officer and director of the Company, $85,000 and $100,000,
respectively. The monies provided by these lenders were used to fund
specifically identifiable investments in contracts and working capital. The
repayment of the advances was contingent on the settlement of certain
investments in contracts. If the settlements occur, we owe the principal of the
note together with 50% or 75% of the net income received by us from the contract
to the lenders. The advances are paid as collected.

      During the nine months ended September 2002, we earned $100,262 in service
fees from Old CFI. pursuant to a service agreement entered into in connection
with the asset purchase transaction. Eric Alden and Harvey Bibicoff, directors
of our Company, are also directors of Old CFI.

      In May 2002 in connection with the asset purchase transaction, we acquired
three promissory notes plus interest in the amount of $104,000, $156,000 and
$108,000, respectively from three individuals: Gordon Gregory, our Co-Chairman,
Glen Gregory, the brother of Gordon Gregory, and Steven Fuld, a former director
of our Company, in exchange for 208,000, 312,000 and 216,000 shares of our
common stock, respectively.

      During the nine months ended September 30, 2002, the accrued interest on
the promissory notes of Old CFI acquired by us in connection with the asset
purchase transaction in May 2002 was $79,000 inclusive of the notes acquired
from Messrs. Gregory, Gregory and Fuld. Eric Alden and Harvey Bibicoff, our
directors, are also directors of Old CFI.

      During the year ended September 30, 2003 we earned $59,519 , in service
fees from Old CFI pursuant to the service agreement entered into in connection
with the asset purchase transaction see MANAGEMENT'S DISCUSSION AND ANALYIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS- Service Fee Revenue. Eric A.
Alden and Harvey Bibicoff, our directors, are also directors of Old CFI.


                                       56
<PAGE>

      From October 1, 2002 through September 30, 2003, we entered into third
party investment agreements with the following persons in the following amounts:
Harvey Bibicoff, our shareholder and director and a shareholder and director of
Old CFI, and Ruben Kitay, a shareholder of Old CFI and step-parent of Eric
Alden, our Chief Executive Officer and Co-Chairman, $593,500 and $320,000,
respectively. In addition we repaid Messrs. Bibicoff and Kitay principal of
$354,000 and $220,000 and participation fees earned of $43,769 and $81,578
respectively upon successful resolution of the underlying cases. The monies
provided by these lenders were used to fund specifically identifiable
investments in contracts. The repayment of the advances was contingent on the
settlement of certain investments in contracts which was repaid along with 75%
of the net income from the contract received by us.

      From October 2002 through December 2002, we received $100,000 in
short-term unsecured advances and repaid $101,071 to Ruben Kitay, a shareholder
of Old CFI and step-parent of Eric A. Alden, our Chief Executive Officer and
Co-Chairman.

      Subsequent to September 30, 2003, an officer and two directors loaned us
$260,000 payable on demand including interest at 12% per annum. The purpose of
the loan was for working capital.

      All transactions conducted with affiliated parties were conducted at
arms-length terms. Our management and affiliates may, from time to time,
experience conflicts of interest with respect to actual or proposed
transactions. We do not have a formal conflicts of interest policy, and resolve
issues as they arise on a case-by-case basis.

Item 13. Exhibits and Reports on Form 8-K

      (a) Exhibits. The exhibits listed on the attached Exhibit Index are filed
as part of this report.

      (b) Reports on Form 8-K. No reports on Form 8-K were filed during the
quarter ended September 30, 2003.


                                       57
<PAGE>

                                   SIGNATURES

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

                                        Case Financial, Inc.

                                        By: /s/ Eric A. Alden
                                           -------------------------------------
                                           Eric A. Alden, President and
                                           Chief Executive Officer

      In accordance with the Exchange Act, this report has been signed below by
the following persons in the capacities and on the dates indicated.

<TABLE>
<CAPTION>
         Signature                               Title                             Date
         ---------                               -----                             ----
<S>                                    <C>                                    <C>
/s/ ERIC A. ALDEN                      Chairman of the Board,
-----------------------------------    President and Chief Executive
Eric A. Alden                          Officer (Principal Executive
                                       Officer                                January 12, 2004


/s/ ERIC A. ALDEN                      (Principal Accounting Officer)         January 12, 2004
-----------------------------------
ERIC A. ALDEN

/s/ LORNE POLLOCK                      Secretary and Director                 January 12, 2004
-----------------------------------
Lorne Pollock

/s/ GORDON GREGORY                     Director                               January 12, 2004
-----------------------------------
Gordon Gregory

/s/ HARVEY BIBICOFF                    Director                               January 12, 2004
-----------------------------------
Harvey Bibicoff

/s/ GARY PRIMES                        Director                               January 12, 2004
-----------------------------------
Gary Primes

/s/ BERNARD CHRISTOPHE                 Director                               January 12, 2004
-----------------------------------
Bernard Christophe
</TABLE>


                                       58
<PAGE>

             EXHIBIT INDEX

4.1*     Warrant to Purchase 2,000,000 Shares of Common Stock Issued to I.F.
         Propco Holdings, 32 Ltd. dated December 12, 2002

4.2*     Warrant to Purchase 1,000,000 Shares of Common Stock Issued to I.F.
         Propco Holdings, 32 Ltd. dated December 12, 2002

4.3*     $2,000,000 Promissory Note of the Registrant issued to I.F. Propco
         Holdings 32 Ltd. dated December 12, 2002

10.1*    Subscription Agreement between the Registrant and I.F. Propco Holdings
         32 Ltd. dated December 12, 2002

10.2*    Agreement relating to Board Representation between the Registrant and
         I.F. Propco Holdings 32 Ltd. dated December 12, 2002

10.3*    Finders Fee Agreement between the Registrant and John Irvine and
         Michael Schaffer dated November 27, 2002

10.4*    Employment Agreement between the Registrant and Lorne Pollock dated
         August 15, 2002

10.5*    Employment Agreement between the Registrant and Steven Gershick dated
         August 19, 2002

10.6*    Employment Agreement between the Registrant and Gary L. Primes dated
         August 15, 2002

10.7*    Employment Agreement between the Registrant and James Lewis dated
         August 15, 2002

10.8*    Consent to Sublease Agreement and Sublease between Kody Pappadato as
         sublessor and the Registrant as sublessee dated June 21, 2002

10.9*    Investment Banking Services Agreement between the Registrant and Mosaic
         Capital LLC dated November 12, 2001

10.10*   $600,000 Promissory Note of Case Financial Inc. issued to Harvey
         Bibicoff dated May 24, 2002

21.1*    Subsidiaries of the Registrant

31.1     Section 302 Certification

31.2     Section 302 Certification

32.1     Section 906 Certification

32.2     Section 906 Certification

--------------------------------------------------------------------------------
* Previously filed


                                       59