U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                   FORM 10-KSB

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

For the fiscal year ended:  September 30, 2003       Commission file No. 0-13167


                                TM CENTURY, INC.
                 (Name of small business issuer in its charter)

       Delaware                                          73-1220394
(State of incorporation)                       (IRS Employer Identification No.)


2002 Academy, Dallas, Texas                                             75234
(Address of principal executive offices)                              (Zip Code)

Issuer's telephone number:                                        (972) 406-6800

Securities registered pursuant to Section 12(b) of the Exchange Act:        None

Securities registered pursuant to Section 12(g) of the Exchange Act:
                                                    Common Stock, $.01 Par Value

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. Yes X  No
                                                             ---   ---

Check if 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

The issuer's revenue for its most recent fiscal year was $5,798,606.

The  aggregate  market value of the voting stock held by  non-affiliates  of the
issuer on September 30, 2003 based upon the average bid and asked prices of such
stock on that date was $642,581.  The number of issuer's  shares of Common Stock
outstanding as of September 30, 2003 was 2,473,193.

                       DOCUMENTS INCORPORATED BY REFERENCE

The Company has historically included the information contained in the Company's
2004 Information  Statement by reference in Part III. However, the Company filed
a Form 15 with an  effective  date of  December  24,  2003.  Since  it will be a
non-reporting  entity, the Company has no intention to file the 2004 Information
Statement and therefore is not incorporating it by reference.

Transitional Small Business Disclosure Format (check one): Yes    No X
                                                              ---   ---
<PAGE>

                                     PART I

ITEM 1.   DESCRIPTION OF BUSINESS

General
-------

TM  Century,  Inc.  (the  "Company")  is  engaged  primarily  in  the  creation,
production, marketing, and worldwide distribution of music libraries, production
libraries, comedy services, station identification and commercials for broadcast
multimedia use.

TM Century's clients include radio and television stations;  radio,  television,
satellite  and Internet  networks;  web sites and portals;  the American  Forces
Radio Network;  advertising agencies; post production studios; cable facilities;
and a wide variety of commercial businesses.

The  Company  was  incorporated  as a Delaware  corporation  on May 2, 1984.  In
October 1990, the Company  changed its name from TM  Communications,  Inc. to TM
Century,  Inc.  following an August 1990 business  combination  transaction with
Century 21 Programming, Inc. The Company's principal offices are located at 2002
Academy, Dallas, Texas 75234, and its telephone number is (972) 406-6800.

Products
--------

The Company  creates,  produces,  markets,  and  distributes  musical  goods and
services for multimedia clients  worldwide.  The music services provided include
compilations of popular music, audio production elements,  sales libraries,  and
comedy and show preparation  elements for broadcast,  as well as  identification
and commercial jingles.

HitDisc(R), GoldDisc(R), GoldDrive(R), and GoldWav(TM) provide copyrighted music
in various  media forms to radio  stations,  satellite  and  Internet  networks,
websites,   the  American  Forces  Radio  Network  and  commercial   businesses.
HitDisc(R)  provides a weekly  service of new  record  releases,  while the Gold
product line  provides  compilation  libraries,  by format,  of Top Twenty music
titles for the past fifty years on compact disc, MP2 or .wav format.

Audio Architecture(R),  Imagio(R), and ImagioPlus(TM), are subscription services
which provide  original  recordings of music beds and sound effects  written and
produced by the Company as sources of production material for radio/TV stations,
post production  houses,  web sites and commercial  businesses.  These services,
along with production libraries are available in a variety of musical styles and
are  used  as  background   music  for  contests,   promotional   announcements,
commercials, film or audio video presentations and web sites. These products are
available on compact discs or available for download from the Company's website.

JingleBank(R) is a library of commercial  jingles available for licensing by any
business either in the generic form or customized for the individual customer.

The Company's  Show Prep and Comedy service  consists of topical  drops,  songs,
bits and parodies  primarily used in morning radio show broadcasts,  provided on
compact disc and online.

Jingles  are short  identity  songs for radio  and  Internet  broadcasters  that
promote name recognition. The Company's Jingle and ID Division can create custom
jingles  or  customize  existing  jingles  to meet  the  specific  needs of each
customer.  Studio  Dragonfly(TM) offers syndicated jingles at a discounted price
online.  All jingles are written and produced through the Company's  studios and
are provided to the customer on compact disc.


                                       2
<PAGE>

Products  provided  to clients on compact  disc are  mastered by the Company and
replicated  in-house  on compact  discs  available  from a number of  suppliers.
Management  believes  that the loss of the current  sources of supply  would not
cause any  significant  interruption of the Company's  operations,  as there are
several alternative sources of compact discs available.

Due to the wide  variety of music  services in multiple  formats  offered by the
Company on compact disc, a significant number of compact discs are maintained on
the premises.  The  implementation of in-house disc replication for all products
during 2001 allows greater  control over inventory  levels  necessary to satisfy
shipping requirements on a timely basis,  however,  certain inventory levels are
maintained for products produced in prior periods.

Set  forth  in the  following  tables  are  the  Company's  gross  revenues  (in
thousands) by  significant  product  category for the years ended  September 30,
2003 and 2002.

     (Dollar Amounts in Thousands)
                                                            2003         2002
                                                         ----------   ----------
Music Services                                           $    4,311   $    4,023
Jingles                                                       1,464        1,161
Other                                                            24            8
                                                         ----------   ----------
Total                                                    $    5,799   $    5,192
                                                         ==========   ==========


Marketing and Distribution
--------------------------

The Company  currently  sells and supplies  its products and services  worldwide
through  its sales  staff in Dallas,  Texas.  Sales are made  through  telephone
solicitation, advertising in trade magazines, trade convention displays, and the
Internet. The Company also sells its products through distribution  arrangements
with  independent  sales agents  worldwide.  Other than fees paid to independent
sales  agents,  no other  significant  costs  are  incurred  by the  Company  in
conjunction with its international  sales activities.  Products are shipped from
the Company's headquarters via mail and express delivery services.

Sales of music and  production  libraries  are made  primarily on an  individual
order basis. Contractual agreements for subscription services generally call for
equal  monthly  payments  by the  customer  over terms of up to 36  months.  The
Company's  other  products are generally  sold  pursuant to  individual  orders.
Products are sold either for cash or barter, depending upon the customer. Barter
revenue is derived from obtaining airtime from radio stations and marketing such
airtime to advertisers.

Customers
---------

The Company's  business is largely  dependent  upon the  broadcasting  industry.
Revenues  are  generated  from  sales to  customers  in the  United  States  and
worldwide.  According  to  industry  publications,  approximately  13,000  radio
stations are licensed by the Federal Communications  Commission (FCC) for public
broadcasting in the United States. Management believes that approximately 11,000
stations in the U. S. may require  products and services of the type provided by
the Company. No single customer has accounted for more than 10% of the Company's
revenues  in any of the  past two  years.  In  fiscal  2003  the  Company  saw a
significant  increase in its sales of music  libraries  outside the  traditional
broadcast  industry  as a result of efforts  to target  satellite  and  Internet
networks, post production facilities, and commercial businesses.

Gross  revenues from foreign  sales totaled  $677,000 and $885,000 for the years
ended 2003 and 2002, respectively.


                                       3
<PAGE>

Competition
-----------

The Company  competes with several other music  syndicators  that provide either
music libraries or radio jingle packages to the broadcast  industry.  Management
believes the Company  offers a broader array of broadcast  products and services
than any of its  competitors.  Competing  radio  program  syndicators  generally
provide jingles,  production libraries, or music on tape, records, compact disc,
or via  satellite.  Management  believes  the  Company  is  one  of the  leading
suppliers  of radio  music  services  and the  largest  supplier  of radio music
services on compact  disc.  The Company  competes  with several  hundred  jingle
producers;  however,  management believes only a few specialize in radio station
identification  materials.  Management believes the Company is one of the larger
suppliers of radio station identification jingles in the industry. Several dozen
providers of production libraries compete with the Company.  Management believes
the Company is one of the major  suppliers of production  libraries to the radio
industry.  While  certain  competing  products may be  considered to be equal in
price or technical  performance,  management  believes the Company also competes
effectively on the basis of quality and creativity within each product line.

Seasonality
-----------

The Company is not subject to strong seasonal fluctuations.  However,  quarterly
results are affected by the  introduction of new products and timing of customer
orders.  Because profit margins on the Company's many products vary, the results
for any  quarter  are not  necessarily  indicative  of the  results  that may be
achieved for a full fiscal year.

Trademarks and Copyrights
-------------------------

The Company markets products under various names and trademarks which management
believes provide the Company's products with international industry recognition.
The Company  holds  hundreds of  registered  copyrights  on sound  recordings of
original  music and radio station  jingles.  Management  believes its copyrights
have  significant  value,  as the Company  derives a significant  portion of its
income from the licensed use of its sound recordings and additional  performance
royalties (ASCAP) earned as a result.

Employees
---------

As of December 1, 2003, the Company had  approximately  40 full-time  employees.
The Company also contracts with other personnel and  subcontractors  who provide
creative talent for various projects on an as-needed basis.

ITEM 2.   DESCRIPTION OF PROPERTY

The Company's  principal  operations  are conducted  from a leased 47,000 square
foot office and production facility located at 2002 Academy,  Dallas, Texas. The
facility is comprised of sales and administrative offices and recording studios.
The  facility  is leased  from  unaffiliated  third  parties  under a lease that
expires  August  31,  2010.  Management  believes  that the  facility  currently
occupied is sufficient for its existing  activities and potential growth for the
foreseeable future.

ITEM 3.   LEGAL PROCEEDINGS

None

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

In a meeting held September 22, 2003 the Board of Directors (the "Board"),  in a
unanimous  vote,  resolved  that, due to the increasing  costs  associated  with
compliance with the  Sarbanes-Oxley Act and other compliance issues, it would be
in the best interests of the  shareholders of the corporation to discontinue the
corporation  as a  reporting  company  under  the  statutes  and  rules  of  the
Securities  and Exchange  Commission and to no longer be a listed company on the
Over-the-Counter Bulletin Board. The Board further resolved that the officers of
the Company be directed to bring the  question  before the  stockholders  of the
Company for a vote.  The Company  filed a Form 15-12g with the SEC on  September
26,  2003 which will  become  effective  on  December  24,  2003.  From that day
forward,  TM  Century,  Inc.  will no longer be a  reporting  company  under the
statutes  of the  Securities  Exchange  Act of 1934  and the  rules  promolgated
thereunder.




                                       4
<PAGE>

Upon  ratification  of the resolution by the Board,  the holders of 69.6% of the
outstanding  Common  Stock of the  Company  executed  a written  consent  to the
adoption of the resolution  presented by the Board of Directors to do all things
necessary to implement this resolution including, but not limited to, the filing
of a Form 15 with the Securities and Exchange Commission.


                                     PART II

ITEM 5.   MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

The Company's common stock is thinly traded in the over-the-counter (OTC) market
under the symbol "TMCI".  The following table sets forth, for the periods shown,
the range of the high and low bid quotations  for the Company's  common stock in
the  over-the-counter  market as reported by NASDAQ.  The Company was  de-listed
from NASDAQ in February 1997 for not meeting the minimum NASDAQ  SmallCap market
requirements. Since that time the stock continues to be traded on the OTC market
with  quotations   obtained  from  the  OTC  bulletin   board.   Quotations  are
inter-dealer quotations,  without retail markups, markdowns or commissions,  and
do not necessarily represent actual transactions.

                                                    Common Stock Bid
                                                    ----------------

                                                   High            Low
                                              -------------    ------------
           Fiscal 2003:
                              1st Quarter             $.28            $.27
                              2nd Quarter              .37             .28
                              3rd Quarter              .51             .33
                              4th Quarter             1.02             .55

           Fiscal 2002:
                              1st Quarter             $.55            $.45
                              2nd Quarter              .55             .36
                              3rd Quarter              .45             .40
                              4th Quarter              .41             .27


As of September 30, 2003 the Company had approximately 196 record owners and 179
beneficial owners of its common stock. The Company has not paid dividends on the
common stock.

ITEM 6.   MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Forward-Looking Statements
--------------------------

This Annual  Report  contains  forward-looking  statements  about the  business,
financial  condition and prospects of the Company that reflect  assumptions made
by management and management's beliefs based on information  currently available
to it. The Company can give no assurance that the expectations indicated by such
forward-looking  statements will be realized. If any of management's assumptions
should prove incorrect, or if any of the risks and uncertainties underlying such
expectations  should  materialize,  the  Company's  actual  results  may  differ
materially from those indicated by the forward-looking statements.

The key factors  that are not within the  Company's  control and that may have a
direct bearing on operating  results include,  but are not limited to, continued
maturation  of  the  domestic  and   international   markets  for  compact  disc
technology;  acceptance by the  customers of the Company's  existing and any new
products and formats;  the development by competitors of products using improved
or alternative  technologies and the potential obsolescence of technologies used
by the Company;  the  continued  availability  of  software,  hardware and other
products obtained by the Company from third parties; dependence on distributors,
particularly  in the  international  market;  the  retention of  employees;  the


                                       5
<PAGE>

success  of the  Company's  current  and  future  efforts  to  reduce  operating
expenses;  the effectiveness of new marketing  strategies;  and general economic
conditions.  Additionally,  the  Company may not have the ability to develop new
products  cost-effectively.  There  may be other  risks and  uncertainties  that
management is not able to predict.

When used in this Annual Report, words such as "believes," "expects," "intends,"
"plans,"  "anticipates,"  "estimates"  and similar  expressions  are intended to
identify   forward-looking   statements,   although   there   may   be   certain
forward-looking   statements   not   accompanied   by  such   expressions.   All
forward-looking statements are intended to be covered by the safe harbor created
by section 21E of the Securities Exchange Commission Act of 1934.

Liquidity and Capital Resources
-------------------------------

The Company relies upon current sales of music libraries and jingles on terms of
cash upon delivery for operating  liquidity.  Liquidity is also provided by cash
receipts from  customers  under  contracts for  production  libraries and weekly
music service contracts having terms of one month to three years. The Company is
obligated  to provide  music  updates  throughout  the  contract  terms for both
production library and weekly music service contracts.  Sales of music libraries
and jingles and the payments under  production  library and weekly music service
contracts will provide, in the opinion of management, adequate liquidity to meet
operating requirements at least through the end of fiscal 2004.

The Company  generated  net income of  approximately  $664,000  in fiscal  2003,
compared to net loss of $57,000 in 2002.  The majority of the Company's  clients
are businesses that are dependent upon advertising  sales for their income.  The
net loss of fiscal 2002 was primarily a result of a decline in advertising sales
experienced by the broadcast industry in fiscal 2002,  exacerbated by the events
of September  11, 2001.  The fourth  quarter of fiscal 2002  reflected  positive
growth in the  advertising  industry,  which  continued its recovery  throughout
fiscal 2003. During fiscal 2003, the Company incurred  approximately $127,000 in
capital  expenditures  for the  purchase of property and  equipment  compared to
capital  expenditures of approximately  $95,000 in 2002. Capital expenditures in
both  2003 and 2002  were  primarily  associated  with  upgrades  of  production
equipment.  Also,  in 2003 the Company  invested an  additional  $100,000 in its
equity  accounted  affiliate,  Sold-Rite  Holdings,  LLC.  The Company also sold
short-term  investments  during the year for a net amount of $204,081.  In 2003,
the Company purchased 8,000 shares of treasury stock at a cost of $6,800 through
the stock  repurchase  plan  authorized by the Board of Directors on October 29,
2001. The Company  purchased  2,000 shares of treasury stock at a cost of $1,500
through this plan in 2002. Funds for operating  needs, new product  development,
and capital  expenditures  for the year ended  September  30, 2003 were provided
from  operations  and cash  reserves.  The  Company  generated  cash  flows from
operations of approximately $781,000 in 2003 primarily due to the net income for
the year adjusted for depreciation  and  amortization,  accounts  receivable and
inventory  reserves,  and a decrease in deferred  revenue,  accounts payable and
accrued  liabilities.  This  was  partially  offset  by  increases  in  accounts
receivable  and  deferred  tax  assets.  The cash flows of $275,000 in 2002 were
primarily  due to the net loss of $57,000  as well as an  increase  in  accounts
receivable. This was offset by depreciation,  amortization,  accounts receivable
reserves  and a decrease  in  deferred  revenue  and  inventory.  The  Company's
expenditures  for  property,  equipment,  and  development  of new  products are
discretionary. Product development costs of $173,000 were incurred during fiscal
2003 for new music  libraries  and music  library  updates,  which  compares  to
product  development  expenditures  of  $158,000  in 2002.  Product  development
expenditures  are  expected to be  approximately  $140,000 in fiscal  2004.  The
Company has no other significant  commitments for capital expenditures in fiscal
2004.  Management  anticipates  that cash flow from operations and cash reserves
will be sufficient to meet capital requirements.

Effective  January 2, 1999, the Company  purchased the remaining 50% interest of
certain  comedy  material  that was written and  produced by an  individual  for
broadcast  by radio  stations  and  marketed by the  Company,  resulting  in the
Company  owning 100% of such comedy  service.  For  consideration  of the comedy
material and the Company being able to use the  individual's  name in connection
with  promoting the Comedy Service the Company agreed to pay to the individual a
total of $124,000, payable over five years through December 2, 2003.


                                       6
<PAGE>

Customer deposits  increased to $186,000 as of September 30, 2003, from $167,000
as of  September  30,  2002,  for  deposits  received  from  customers  ordering
products.  The balance in  customer  deposits  is  dependent  upon the timing of
customer orders for compact disc libraries, jingles, and production libraries.

At September  30, 2002,  the Company had net  operating  loss  carryforwards  of
approximately  $609,000  available to offset future taxable  income  expiring in
2011 through 2022. At September 30, 2002, a valuation allowance of approximately
$360,000  was  provided to reduce the net  deferred tax asset to zero because of
the uncertainty of generating  future taxable income.  As of September 30, 2003,
the Company had fully utilized the net operating loss carryforward.  The Company
recorded at net  deferred  tax asset of $200,583 at  September  30,  2003.  This
deferred tax asset results from the reduction of valuation  reserves  previously
established  and  increases  in deferred  tax assets  during  2003.  The Company
reduced its valuation  allowance to zero because the Company  generated  taxable
income 2003 and expects to do so again in fiscal 2004.

Results of Operations
---------------------

Fiscal 2003 Compared to Fiscal 2002
-----------------------------------

The Company  generated  net income of $664,000 in 2003 compared to a net loss of
$57,000 in 2002.  This income was  primarily  the result of a 10.9%  increase in
revenues from $5.2 million in 2002 to $5.8 million in 2003. The increase was due
to an increase in  advertising  revenues,  which  increased from $1.7 million in
2002 to $2.3 million in the current year, and due to the income tax benefit from
recognizing net deferred tax assets.

The majority of the Company's  clients are businesses that depend on advertising
sales for their income. The serious recession in advertising expenditures in the
prior year caused most,  if not all, of these  businesses to curtail or postpone
spending,  especially in  non-essential  products such as those  marketed by the
Company.  It is management's view that the worst of the recession has passed and
a return to  positive  growth  trends for  advertising  was  experienced  in the
current fiscal year.  This trend is expected to result in increased  spending on
products such as those marketed by the Company in the near future,  although the
positive impact cannot be determined with any certainty.

Music services and single revenue generated from cash sales decreased $1,000, or
0.03%. Barter revenue increased $608,000,  or 36.5%, which is attributable to an
increase in advertising  rates for barter  service.  Barter revenues are derived
from  obtaining  airtime  from radio  stations  in  exchange  for  products  and
marketing such airtime to advertisers.

As the compact disc music  library  market  matures,  sales of compact discs are
generated  primarily  from  changes  in music  formats  or  sales  of new  music
libraries rather than from conversions to compact disc music library technology.
The market for compact disc music libraries to broadcast customers has reached a
substantial  level of  maturity in the United  States,  which is the market from
which the Company  derives  most of its music  library  revenues.  However,  the
advent of  computer-based  music storage has opened a new market to the Company;
delivering  music in a form (.wav file format and MPEG format)  more  conducive,
convenient  and cost  efficient for operators to load onto their  computer-based
broadcast  systems. A decline in revenues from music library sales may result in
a  proportionately  greater decline in operating  income because music libraries
provide higher margins than the Company's  other products.  However,  management
believes that revenues from weekly music services will either remain  relatively
unchanged or continue to grow by introducing  new music libraries to the market.
Management  believes the  international  markets  have not reached  maturity for
compact disc  technology.  Renewals and new sales growth are subject to customer
acceptance of the new products.

Music library revenues may also be adversely  affected as radio stations convert
to new  music  delivery  systems  technology  offered  by  competitors,  such as
computer  hard  drives  which  store music in a digital  compression  form.  The
Company began  providing  music libraries on hard drive to the radio industry in
1997. An increasing number of radio stations are converting to or adding systems
using  digital  technology.  Although  music  libraries  on compact  disc can be
transferred  to hard drive  systems,  some of the equipment  manufacturer's  are
offering hard drives with pre-loaded music libraries.


                                       7
<PAGE>

Production,  programming  and technical  costs  decreased 3.9% to  approximately
$1.55 million in 2003 from  approximately  $1.6 million in 2002. The decrease is
primarily due to lower direct costs  resulting  from the  conversion to in-house
compact disc replication,  combined with cost saving measures implemented in all
other aspects of production and shipping.

General and administrative costs increased  approximately  $66,000, or 3.6%. The
increase was a result of ordinary  increases in the areas of professional  fees,
facilities expenses and an officer bonus.

Selling costs  reflected a decrease of $40,000,  or 4.8% in 2003 from 2002.  The
Company  took  advantage  of the loss of sales  personnel  through  attrition by
restructuring the compensation plans for new employees to reduce fixed costs and
provide more efficient coverage of the market.

Critical Accounting Policies
----------------------------

The  Consolidated  Financial  Statements  have been prepared in accordance  with
accounting principles generally accepted in the United States, which require the
Company to make estimates and  assumptions  that affect the reported  amounts of
assets and liabilities at the date of the Consolidated Financial Statements, and
revenues and expenses during the periods  reported.  Actual results could differ
from those  estimates.  The Company  believes  the  following  are the  critical
accounting  policies  which  could  have  the  most  significant  effect  on the
Company's reported results and require the most difficult, subjective or complex
judgments by management.

Inventories and Product Development Costs:

Inventories  are carried at the lower of average  cost on a first-in,  first-out
("FIFO") basis or market, and charged to expense as follows:

         Music  libraries  -  The  Company   produces  music   compilations  and
         background  music  libraries which are provided to clients under one to
         three year  lease  contracts  or under  buyout  arrangements.  Costs of
         current  music update  services are charged to expense in the period in
         which incurred.

         Identification  Jingles  -  Jingles  provide  short  identity  songs to
         clients  in order to  promote  name  recognition.  The costs to produce
         jingles are expensed upon delivery of the product.

Product  development  costs (the costs to develop new libraries and updates) are
carried  at actual  cost and are  amortized  on a  straight-line  basis over the
economic life of the product (typically, three to five years).

The  provision  for obsolete  and  slow-moving  inventory  is adjusted  based on
current inventory levels, historical and expected future sales levels.

Revenue Recognition:

Revenues are recognized according to contract terms as follows:

         Library  Lease  Contracts  - Monthly  upon  delivery  of the product in
         accordance with the terms of the lease contracts.

         Library Buyouts - Upon delivery of the product.

         Identification Jingles - Upon delivery of the product.

         Barter  Contracts - Monthly,  as advertising  revenues are generated by
         third party agents,  in accordance  with the terms of the library lease
         contracts.


                                       8
<PAGE>

Deferred Tax Assets:

The Company  provides for income taxes under the asset and  liability  approach.
This method  requires that deferred tax assets and liabilities be 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. Valuation allowances are established,  when necessary,  to
reduce deferred tax assets to the amount  expected to be realized.  Deferred tax
assets and liabilities are measured using enacted tax rates expected to apply to
taxable income in the years in which those temporary differences are expected to
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.

Accounting Matters
------------------

The Financial Accounting Standards Board ("FASB") periodically issues accounting
standards  that may  affect  the  financial  accounting  or  disclosures  of the
Company.   In  January  2003,  the  FASB  issued  FASB   Interpretation  No.  46
"Consolidation of Variable Interest Entities",  an interpretation of ARB No. 51.
The Company  adopted FASB  Interpretation  No. 46 effective  July 1, 2003.  This
interpretation  requires an entity to consolidate all variable interest entities
(as defined by the  interpretation).  The Company has analyzed its investment in
Sold Rite Holdings,  LLC and has determined  that as of September 30, 2003 there
would not be a  significant  difference  between the equity method of accounting
and consolidation.

Inflation and Foreign Currency Fluctuations
-------------------------------------------

To date,  inflation and foreign  currency  fluctuations  have not had a material
impact on the Company's  operations.  There can be no assurance,  however,  that
future  inflation  or foreign  currently  fluctuations  will not have a material
adverse  effect  on the  Company,  or that the  Company  will be able to pass on
resulting  cost  increases  without  experiencing  a reduction in demand for its
products.




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                                       9
<PAGE>

                          ITEM 7. FINANCIAL STATEMENTS


                        TM CENTURY, INC. AND SUBSIDIARIES

                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS


Report of Independent Certified Public Accountants                            11

Consolidated Financial Statements:

Consolidated Balance Sheets at September 30, 2003 and 2002                    12

Consolidated Statements of Operations for the Years Ended
   September 30, 2003 and 2002                                                13

Consolidated Statement of Stockholders' Equity for the Years Ended
   September 30, 2003 and 2002                                                14

Consolidated Statements of Cash Flows for the Years Ended September 30,
   2003 and 2002                                                              15

Notes to Consolidated Financial Statements                                 16-25































                                       10
<PAGE>

               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
               --------------------------------------------------







To The Board of Directors
TM Century, Inc.


We have audited the accompanying consolidated balance sheets of TM Century, Inc.
and subsidiaries as of September 30, 2003 and 2002, and the related consolidated
statements of  operations,  stockholders'  equity,  and cash flows for the years
then ended.  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 audits 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 consolidated  financial position of TM Century, Inc.
and subsidiaries as of September 30, 2003 and 2002, and the consolidated results
of their  operations and their cash flows for the years then ended in conformity
with accounting principles generally accepted in the United States of America.


KBA Group LLP
Dallas, Texas
November 21, 2003





















                                       11
<PAGE>
<TABLE>
<CAPTION>

                        TM Century, Inc. and Subsidiaries
                           Consolidated Balance Sheets

                                     ASSETS
                                                                               September 30,    September 30,
                                                                                    2003             2002
                                                                               -------------    -------------
<S>                                                                            <C>              <C>
CURRENT ASSETS
 Cash and cash equivalents                                                     $   1,026,876    $     459,649
 Short-term investments                                                              441,371          645,452
 Accounts receivable, less allowance for doubtful accounts
  of $51,192 and $49,181, respectively                                               942,587          635,814
 Inventories, net of allowance for obsolescence of $355,149 and
  $258,000 respectively                                                              263,070          369,779
 Prepaid expenses                                                                     82,113           88,577
 Current deferred income tax asset                                                   132,636             --
                                                                               -------------    -------------
       TOTAL CURRENT ASSETS                                                        2,888,653        2,199,271

PROPERTY AND EQUIPMENT                                                             3,107,873        2,981,103
 Less accumulated depreciation and amortization                                   (2,709,383)      (2,556,719)
                                                                               -------------    -------------
       NET PROPERTY AND EQUIPMENT                                                    398,490          424,384

EQUITY ACCOUNTED INVESTMENT IN AFFILIATE, A RELATED ENTITY                            89,937             --
PRODUCT DEVELOPMENT COSTS, net of accumulated amortization
 of $649,890 and $502,474, respectively                                              415,764          403,455
COMEDY MATERIAL RIGHTS, net of accumulated amortization
 of $117,800 and $93,000, respectively                                                 6,200           31,000
OTHER ASSETS                                                                           6,814            7,560
NON-CURRENT DEFERRED INCOME TAX ASSET                                                 67,947             --
                                                                               -------------    -------------
 TOTAL ASSETS                                                                  $   3,873,805    $   3,065,670
                                                                               =============    =============

                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
 Current portion of note payable                                               $       3,000    $      12,000
 Accounts payable                                                                     35,243           30,956
 Accrued expenses                                                                    151,040           87,065
 Federal income tax payable                                                            3,961             --
 Deferred revenue                                                                    201,213          129,484
 Customer deposits - current                                                          55,888           59,645
                                                                               -------------    -------------
       TOTAL CURRENT LIABILITIES                                                     450,345          319,150

NOTE PAYABLE, less current portion                                                      --              3,000
CUSTOMER DEPOSITS - non-current                                                      130,080          107,170
                                                                               -------------    -------------
       TOTAL LIABILITIES                                                             580,425          429,320

STOCKHOLDERS' EQUITY
 Common stock, $.01 par value; authorized 7,500,000 shares; 2,970,481 shares
 issued; 2,473,193 and 2,481,193 shares outstanding, respectively                     29,705           29,705
 Additional paid-in capital                                                        2,275,272        2,275,272
 Retained earnings                                                                 2,287,930        1,624,100
 Treasury stock - at cost, 497,288 and 489,288 shares, respectively               (1,299,527)      (1,292,727)
                                                                               -------------    -------------
       TOTAL STOCKHOLDERS' EQUITY                                                  3,293,380        2,636,350
                                                                               -------------    -------------

 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                    $   3,873,805    $   3,065,670
                                                                               =============    =============
</TABLE>

The  accompanying  notes are an integral  part of these  consolidated  financial
statements.


                                       12
<PAGE>
<TABLE>
<CAPTION>

                        TM Century, Inc. and Subsidiaries
                      Consolidated Statements of Operations



                                                             Year ended September 30,
                                                            --------------------------
                                                                2003           2002
                                                            -----------    -----------
<S>                                                         <C>            <C>

REVENUES                                                    $ 5,798,606    $ 5,191,706
  Less  Commissions                                             923,156        829,343
                                                            -----------    -----------
  NET REVENUES                                                4,875,450      4,362,363

COSTS AND EXPENSES
  Production, Programming, and Technical Costs                1,551,152      1,604,888
  General and Administrative                                  1,913,783      1,847,607
  Selling Costs                                                 793,495        833,749
  Depreciation and Amortization of Property and Equipment       152,664        150,281
                                                            -----------    -----------
  TOTAL COSTS AND EXPENSES                                    4,411,094      4,436,525

                                                            -----------    -----------
OPERATING INCOME (LOSS)                                         464,356        (74,162)

OTHER INCOME (EXPENSE)
  Interest income                                                12,915         14,787
  Other income (expense), net                                      --            2,831
  Equity accounted loss in affiliate                            (10,063)          --
                                                            -----------    -----------
TOTAL OTHER INCOME, NET                                           2,852         17,618
                                                            -----------    -----------

INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES                 467,208        (56,544)

INCOME TAX BENEFIT                                              196,622           --
                                                            -----------    -----------
NET INCOME (LOSS)                                           $   663,830    $   (56,544)
                                                            ===========    ===========

BASIC NET INCOME (LOSS) PER COMMON SHARE                    $      0.27    $     (0.02)
                                                            ===========    ===========

DILUTED NET INCOME (LOSS) PER COMMON SHARE                  $      0.27    $     (0.02)
                                                            ===========    ===========
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
- BASIC                                                       2,480,127      2,481,443
                                                            ===========    ===========
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING,
 ASSUMING DILUTION                                            2,480,127      2,481,443
                                                            ===========    ===========
</TABLE>








The  accompanying  notes are an integral  part of these  consolidated  financial
statements.

                                       13
<PAGE>
<TABLE>
<CAPTION>

                        TM Century, Inc. and Subsidiaries
                 Consolidated Statement of Stockholders' Equity
                     Years Ended September 30, 2003 and 2002



                                    Common Stock                                              Treasury Stock
                              -------------------------    Additional                    -------------------------       Total
                               Number of                     Paid-In        Retained      Number of       Amount      Stockholders'
                                 Shares        Amount        Capital        Earnings        Shares      (at cost)        Equity
                              -----------   -----------    -----------    -----------    -----------   -----------    -----------
<S>                           <C>           <C>            <C>            <C>            <C>           <C>            <C>

BALANCE, SEPTEMBER 30, 2001     2,970,481   $    29,705    $ 2,275,272    $ 1,680,644        487,288   $(1,291,227)   $ 2,694,394

Repurchase of Stock                                                                            2,000        (1,500)        (1,500)

Net Loss                             --            --             --          (56,544)          --            --          (56,544)
                              -----------   -----------    -----------    -----------    -----------   -----------    -----------

BALANCE, SEPTEMBER 30, 2002     2,970,481   $    29,705    $ 2,275,272    $ 1,624,100        489,288   $(1,292,727)   $ 2,636,350

Repurchase of Stock                  --            --             --             --            8,000        (6,800)        (6,800)

Net Income                           --            --             --          663,830           --            --          663,830
                              -----------   -----------    -----------    -----------    -----------   -----------    -----------

BALANCE, SEPTEMBER 30, 2003     2,970,481   $    29,705    $ 2,275,272    $ 2,287,930        497,288   $(1,299,527)   $ 3,293,380
                              ===========   ===========    ===========    ===========    ===========   ===========    ===========
</TABLE>































The  accompanying  notes are an  integral  part of this  consolidated  financial
statement.


                                       14
<PAGE>
<TABLE>
<CAPTION>

                        TM Century, Inc. and Subsidiaries
                      Consolidated Statements of Cash Flows

                                                                                    Year ended September 30,
                                                                                   --------------------------
                                                                                      2003           2002
                                                                                   -----------    -----------
<S>                                                                                <C>            <C>
OPERATING ACTIVITIES
     Net income (loss)                                                             $   663,830    $   (56,544)
     Adjustments to reconcile net income (loss) to
     net cash provided by operating activities
            Depreciation and amortization of property and equipment                    152,664        150,281
            Amortization of product development costs and comedy material rights       185,009        182,676
            Provision for doubtful accounts                                             65,500         16,750
            Provision for obsolete inventory                                           105,604           --
            Deferred income taxes                                                     (200,583)          --
            Loss on equity accounted investment                                         10,063           --
     Increase (decrease) from changes in operating assets
     and liabilities:
            Accounts receivable                                                       (372,273)      (112,076)
            Inventories                                                                  1,105         50,481
            Prepaid expenses                                                             6,464        (21,753)
            Other assets                                                                   746         12,244
            Federal income tax payable                                                   3,961           --
            Accounts payable and accrued expenses                                       68,262         (3,013)
            Deferred revenue                                                            71,729         48,602
            Customer deposits                                                           19,153          6,978
                                                                                   -----------    -----------
     NET CASH PROVIDED BY OPERATING ACTIVITIES                                         781,234        274,626

INVESTING ACTIVITIES
     Product development costs                                                        (172,518)      (157,531)
     Sale (purchase) of short-term investments, net                                   (204,081        (11,403)
     Investment in equity accounted affiliate, a related entity                       (100,000)          --
     Purchases of property and equipment                                              (126,770)       (94,618)
                                                                                   -----------    -----------
     NET CASH USED IN INVESTING ACTIVITIES                                            (195,207)      (263,552)

FINANCING ACTIVITIES
     Principal payments on note payable                                                (12,000)       (14,556)
     Acquisition of treasury stock                                                      (6,800)        (1,500)
                                                                                   -----------    -----------
     NET CASH USED IN FINANCING ACTIVITIES                                             (18,800)       (16,056)
                                                                                   -----------    -----------

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                                   567,227         (4,982)

CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR                                         459,649        464,631
                                                                                   -----------    -----------

CASH AND CASH EQUIVALENTS AT END OF YEAR                                           $ 1,026,876    $   459,649
                                                                                   ===========    ===========


SUPPLEMENTAL CASH FLOW INFORMATION

     Cash paid for interest                                                        $      --      $      --
                                                                                   ===========    ===========

     Cash paid for income taxes                                                    $      --      $      --
                                                                                   ===========    ===========
</TABLE>

The  accompanying  notes are an integral  part of these  consolidated  financial
statements.


                                       15
<PAGE>

                        TM CENTURY, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


1.  THE COMPANY

TM  Century,  Inc.  (the  "Company")  is  primarily  engaged  in  the  creation,
production,  marketing,  and  distribution  of goods and  services for radio and
television stations;  radio,  television,  satellite and Internet networks;  web
sites and portals;  post  production  houses;  and corporate  users,  worldwide.
Products include special  compilations of popular music on compact discs,  sound
effects, comedy services, station identification and commercial jingles.

2.  SUMMARY OF SIGNIFICANT ACCOUNTING AND REPORTING POLICIES

Principles of Consolidation

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

Cash and Cash Equivalents

Cash and cash  equivalents of the Company are comprised of demand  deposits with
banks and other highly  liquid debt  instruments  with  maturity  terms of three
months or less when purchased.

Short-term Investments

Short-term investments are comprised of short-term and medium-term bonds. All of
the Company's  investments  are  classified as available for sale,  based on its
intent and ability to sell these bonds, and accordingly are carried at estimated
fair value.  For  investments  classified  as  available  for sale,  the related
unrealized  holding  gains and losses are  typically  excluded from earnings and
reported,  net of income taxes, as a separate component of stockholders'  equity
until  realized.  Realized  gains and  losses  are  determined  on the  specific
identification method and are reflected in net income.

Accounts Receivable

The  Company  extends  unsecured  credit in the  normal  course of  business  to
virtually  all of its  customers.  Management  has  provided  an  allowance  for
doubtful  accounts  which  reflects its opinion of amounts which may  ultimately
become  uncollectible.  In the event of non-performance of accounts  receivable,
the maximum  exposure to the Company is the recorded amount shown on the balance
sheets.

Equity Investment

The Company  accounts  for  investments  in which it has an  ownership  interest
between  20% and 50% under the  equity  method of  accounting.  Under the equity
method of accounting,  the Company's share of the investee's income or losses is
included in the Statements of Operations.

Inventories and Product Development Costs

Inventories,  which consist primarily of compact discs, are carried at the lower
of average cost on a first-in,  first-out  ("FIFO") basis or market, and charged
to expense as follows:



                                       16
<PAGE>

         Music  libraries  -  The  Company   produces  music   compilations  and
         background  music  libraries which are provided to clients under one to
         three year  lease  contracts  or under  buyout  arrangements.  Costs of
         current  music update  services are charged to expense in the period in
         which incurred.

         Identification  Jingles  -  Jingles  provide  short  identity  songs to
         clients  in order to  promote  name  recognition.  The costs to produce
         jingles are expensed upon delivery of the product.

Product  development  costs (the costs to develop new libraries and updates) are
carried  at actual  cost and are  amortized  on a  straight-line  basis over the
economic life of the product (typically, three to five years).

The  provision  for obsolete  and  slow-moving  inventory  is adjusted  based on
current inventory levels, historical and expected future sales levels.

Comedy Material Rights

Comedy Material Rights are recorded at cost and are amortized on a straight-line
basis over the economic life of the product (5 years).

Property and Equipment

Expenditures for property and equipment additions, renewals, and betterments are
recorded  at cost.  Expenditures  for  maintenance  and  repairs  are charged to
expense as  incurred.  Property  leased  under  capital  leases is  included  in
property and equipment.  Depreciation and amortization of property and equipment
are computed on the  straight-line  method based upon the estimated useful lives
of the assets or the applicable minimum lease term if shorter, as follows:


     Furniture and equipment                                        5 to 7 years
     Computer software and equipment                                3 to 5 years
     Production equipment                                           5 to 7 years
     Leasehold improvements          the shorter of the estimated useful life or
                                                 the remaining term of the lease
     Vehicle                                                             5 years
     Capital lease                   the shorter of the estimated useful life or
                                                 the remaining term of the lease

Revenue Recognition

Revenues are recognized according to contract terms as follows:

         Library  Lease  Contracts  - Monthly  upon  delivery  of the product in
         accordance with the terms of the lease contracts.

         Library Buyouts - Upon delivery of the product.

         Identification Jingles - Upon delivery of the product.

         Barter  Contracts - Monthly,  as advertising  revenues are generated by
         third party agents,  in accordance  with the terms of the library lease
         contracts.



                                       17
<PAGE>

Income Taxes

The Company  provides for income taxes under the asset and  liability  approach.
This method  requires that deferred tax assets and liabilities be 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. Valuation allowances are established,  when necessary,  to
reduce deferred tax assets to the amount  expected to be realized.  Deferred tax
assets and liabilities are measured using enacted tax rates expected to apply to
taxable income in the years in which those temporary differences are 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.

Net Income (Loss) Per Share

Basic net income (loss) per common share is based on the weighted average number
of common shares  outstanding  during the respective  periods.  Diluted earnings
(loss) per share of common  stock  includes the impact of  outstanding  dilutive
stock  options,  if any.  The Company had  632,500  and  373,000  stock  options
outstanding  as of September 30, 2003 and 2002,  respectively.  The  outstanding
options were  anti-dilutive at September 30, 2003 and 2002.  Accordingly,  basic
income per share and diluted income per share are identical.

Stock Based Compensation

The Company accounts for its stock-based  employee  compensation  plan using the
intrinsic  value-based method prescribed by Accounting  Principles Board Opinion
No. 25, "Accounting for Stock Issued to Employees," and related interpretations.
As such, compensation expense is recorded on the date of grant to the extent the
current market price of the  underlying  stock exceeds the exercise  price.  The
Company recorded no compensation  expense  associated with options issued during
the  periods  ended  September  30, 2003 and 2002.  Had the  Company  determined
compensation  based on the fair  value at the grant  date for its stock  options
under Statement of Financial  Accounting Standards ("SFAS") No. 123, "Accounting
for Stock-Based Compensation," as amended by SFAS No. 148, net income (loss) and
net income (loss) per share would have been affected as indicated below:

                                                       Year Ended September 30,
                                                          2003          2002
                                                       ----------    ----------

Net income (loss) attributable to common
stockholders as reported                               $  663,830    $  (56,544)

Add:     Stock-based employee compensation
         expense included in reported net income (loss)      --            --
Deduct:  Stock-based employee compensation expense
         determined under fair value based method         (19,813)      (17,333)
                                                       ----------    ----------
Pro forma net income (loss)                            $  644,017    $  (73,877)
                                                       ==========    ==========

Net income (loss) per share, basic and diluted
     As reported                                       $      .27    $    (.02)
                                                       ==========    =========
     Pro forma                                         $      .26    $    (.03)
                                                       ==========    =========

Use of Estimates

The  preparation  of financial  statements  in  conformity  with U.S.  generally
accepted  accounting  principles  requires  management  to  make  estimates  and
assumptions  that  affect  reported  amounts  of  certain  assets,  liabilities,
revenues, and expenses. Actual results may differ from such estimates.



                                       18
<PAGE>

Concentrations

The  Company  maintains  cash  balances at banks,  which may,  at times,  exceed
federally insured limits.  However,  management monitors these balances and does
not believe undue risk is present.

Fair Value of Financial Instruments

At September  30, 2003 and 2002 the  carrying  value of the  Company's  accounts
receivable,  accounts payable,  and accrued  liabilities  approximate fair value
because of their  short-term  nature.  The Company entered into one non-interest
bearing note payable during 1999. The impact of imputed interest is not material
to the financial statements of the Company.

3.  INVENTORIES

Inventories  include raw materials for in-house  production  and  replication of
compact discs as well as compact discs completed and ready to ship as follows:

                                                           September 30,
                                                   ----------------------------
                                                       2003            2002
                                                   ------------    ------------
         Raw materials                             $     31,528    $     19,444
         Finished goods                                 586,691         608,335
         Allowance for obsolescence                    (355,149)       (258,000)
                                                   ------------    ------------
         Total                                     $    263,070    $    369,779
                                                   ============    ============

4.  PROPERTY AND EQUIPMENT

Property and equipment consists of the following at September 30, 2003 and 2002:

                                                       2003            2002
                                                   ------------    ------------
    Furniture and equipment                        $    567,375    $    567,000
    Computer software and equipment                     365,296         312,166
    Production equipment                              1,204,398       1,131,133
    Leasehold improvements                              422,935         422,935
    Vehicle                                              19,142          19,142
    Capital lease                                       528,727         528,727
                                                   ------------    ------------
           Total                                   $  3,107,873    $  2,981,103
                                                   ============    ============

5.  NOTE PAYABLE

During   1999,   the   Company   issued   a   $124,000   non-interest   bearing,
uncollateralized  note payable in exchange for comedy material rights. This note
requires  monthly  payments  of $2,778  through  December  2,  2002 and  monthly
payments of $1,000 thereafter through December 2, 2003.




                                       19
<PAGE>

6.  COMMITMENTS AND CONTINGENCIES

Leases

The Company  signed a lease for its facilities  effective  March 1, 2002 through
August 31,  2010.  The lease may be  extended  at the  Company's  option for one
additional  five-year  term.  The Company  also has an  equipment  lease that is
classified as an operating lease that is effective through August 13, 2007.

Future minimum lease payments under operating leases with initial lease terms in
excess of one year are as follows:

         2004                                                            297,329
         2005                                                            300,923
         2006                                                            340,452
         2007                                                            338,435
         2008                                                            318,036
         Thereafter                                                      647,451
                                                                   -------------
         Future minimum lease payments                             $   2,242,626
                                                                   =============


Rent expense  under  operating  leases was $250,324 and $273,671 net of sublease
rental income of $84,775 and $85,391, for 2003 and 2002, respectively.

Employment and Consulting Agreements

An agreement was approved  effective  October 1, 2002 to renew the employment of
R. David Graupner,  President and CEO since May 1999. The agreement provides for
a base salary of $180,000 per year through  September  30, 2005 and  performance
based bonuses to be determined annually.  The agreement also grants Mr. Graupner
250,000 stock options at $ .34 per share, which vest at a rate of 40% upon grant
and 20% per year thereafter through the term of the agreement.

The Company has consulting  agreements with certain current members and a former
member of the Board of Directors. Total compensation expensed in connection with
these  consulting   agreements  was  $77,850  and  $130,350  in  2003  and  2002
respectively.

The Company also has a consulting  agreement  with a third party that expires on
November 30, 2003. Total expense under this agreement was $30,000 and $0 in 2003
and 2002, respectively.

Commitments  for future  salaries  under  employment  agreements  and consulting
agreements as of September 30, 2003 are as follows:

         2004                                                      $     287,200
         2005                                                            200,750
                                                                   -------------
         Total employment and consulting commitments               $     487,950
                                                                   =============



                                       20
<PAGE>

7.  INCOME TAXES

Differences between the statutory federal income tax rate and the effective rate
for the years ended September 30, 2003 and 2002 are as follows:

                                                        2003            2002
                                                    ------------    ------------
     Income tax provision at statutory rate            34.00%          35.00%
     Effect of graduated tax rates                      1.00             --
     Permanent differences                               .56           (1.00)
     Change in valuation allowance                    (77.10)         (10.13)
     Change in prior year estimate                     (3.65)           7.45
     Other                                              3.11          (31.32)
                                                    ------------    ------------
                                                      (42.08%)          0.00%
                                                    ------------    ------------

The  income tax  benefit  consisted  of the  following  during  the years  ended
September 30, 2003 and 2002:

                                                        2003            2002
                                                    ------------    ------------
        Current income tax provision                $     (3,961)   $       --
        Deferred income tax benefit                      200,583            --
                                                    ------------    ------------
        Net income tax benefit                      $    196,622    $       --
                                                    ============    ============

At September 30, 2002,  the Company had a net  operating  loss  carryforward  of
approximately  $609,000  available to offset future taxable  income  expiring in
2011 through  2022. A valuation  allowance  of  approximately  $360,000 had been
provided to reduce the net deferred tax asset to zero because of the uncertainty
of generating  future taxable income.  As of September 30, 2003, the Company had
fully utilized the net operating loss  carryforward.  The Company has recorded a
net  deferred  tax asset of $200,583  representing  timing  differences  between
financial reporting and federal tax reporting.

The components of the net deferred income tax assets  (liabilities) at September
30, 2003 and 2002 are as follows:

                                                            2003         2002
                                                         ---------    ---------
     Deferred income tax asset - current
         Allowance for doubtful accounts                 $  17,917    $  17,052
         Inventory allowance for obsolescence              117,658       90,491
         Unrealized investment losses                       (2,939)        --
         Valuation allowance                                  --       (107,543)
                                                         ---------    ---------
           Total current deferred income tax asset       $ 132,636    $    --
                                                         ---------    ---------

     Deferred tax asset - non-current
         Property and equipment                          $  67,947    $  56,710
         Net operating loss carryforwards                     --        195,969
         Valuation allowance                                  --       (252,679)
                                                         ---------    ---------
           Total non-current deferred income tax asset   $  67,947    $    --
                                                         ---------    ---------

     Net deferred tax asset                              $ 200,583    $    --
                                                         =========    =========



                                       21
<PAGE>
<TABLE>
<CAPTION>

8.  EARNINGS (LOSS) PER SHARE

The  following  table  provides a  reconciliation  between basic and diluted net
income (loss) per share:

                                                                     Year Ended
                                                                   September 30,
                                                            -------------------------
                                                                2003          2002
                                                            -----------   -----------
<S>                                                         <C>           <C>

        Net Income (Loss)                                   $   663,830   $   (56,544)
        Weighted Average Number of Shares Outstanding
              Basic                                           2,480,127     2,481,443
              Dilutive effect of common stock equivalents          --            --
                                                            -----------   -----------
              Diluted                                         2,480,127     2,481,443

        Earnings Per Share:
              Basic Net Income (Loss)                       $       .27   $     (0.02)
                                                            ===========   ===========
              Diluted Net Income (Loss)                     $       .27   $     (0.02)
                                                            ===========   ===========
</TABLE>

9.  TREASURY STOCK

On October  29,  2001 the Board of  Directors,  by  resolution,  authorized  the
Company to purchase up to 100,000  shares of its common stock on the open market
or through privately negotiated transactions,  from time to time, dependent upon
market  conditions,  from  November  1, 2001  through  October 31,  2003.  As of
September 30, 2003 the Company has made purchases of 10,000 shares at an average
price of $.83 per share.  These  purchases  were funded by cash  reserves of the
Company.  Future  purchases  are expected to be funded from  operations  or cash
reserves of the Company.

10.  STOCK OPTIONS

On December 3, 1991, the Board of Directors  approved a Long Term Incentive Plan
(the "Plan")  which  provides for grants of Incentive  Stock Options to selected
employees  and for grants of  Nonqualified  Stock Options to any persons who, in
the opinion of the Board of Directors, perform significant services on behalf of
the Company.  Each member of the Compensation  Committee who was not an employee
or full-time consultant of the Company was automatically  granted in December of
each year, commencing in 1991, for five years (but only for so long as he or she
remained a member of the Compensation  Committee),  a Nonqualified  Stock Option
for 2,500 shares.  The maximum number of shares which may be issued  pursuant to
the exercise of options under the Plan was 187,500 shares. Effective October 28,
1993, the Board of Directors  approved an amendment to the Plan which  increased
the  total  number of shares  which  may be issued to  250,000  shares of common
stock. The Board of Directors approved an amendment to the Plan,  effective July
2,  1999,  which  increased  the total  number of shares  which may be issued to
350,000 shares of common stock and provided for Employee Incentive Options based
upon an employee's length of employment.

The option  price of  Incentive  Stock  Options is not less than the fair market
value of the common stock at the date of grant. All outstanding  Incentive Stock
Options vest over a period of five years from the date of grant at a rate of 20%
upon grant,  35% after year one, 50% after year two,  65% after year three,  80%
after year four and 100% after year five.

The option prices of outstanding Nonqualified Stock Options issued to members of
the  Company's  Board of  Directors  range  from  $.75 to $1.20 per  share.  All
outstanding  Nonqualified  Stock  Options are 20% vested upon grant,  50% vested
after year one, and 100% vested after two years.

Employee  Incentive Stock Options are granted based on the employee's  length of
employment  at an option price not less than the fair market value of the common
stock at the date of grant. All Employee Incentive Stock Options are 100% vested
upon grant.


                                       22
<PAGE>

10.  STOCK OPTIONS (Continued)

On March 20, 2000,  the Board of  Directors  approved the 2000 Stock Option Plan
(the "Plan")  which  provides for grants of Incentive  Stock Options to selected
employees  and for grants of  Nonqualified  Stock Options to any persons who, in
the opinion of the Board of Directors, perform significant services on behalf of
the Company.  Each member of the Compensation  Committee who was not an employee
or full-time consultant of the Company was automatically  granted in December of
each year, commencing in 2000, for five years (but only for so long as he or she
remained a member of the Compensation  Committee),  a Nonqualified  Stock Option
for 2,500 shares.  The maximum number of shares which may be issued  pursuant to
the exercise of options under the Plan is 350,000 shares.

Option  information for the fiscal years ended September 30, 2003 and 2002 is as
follows:
<TABLE>
<CAPTION>

                                                                                  Weighted Avg.
                                                      Number of        Price        Price Per
                                                       Shares        Per Share        Share
                                                       ------        ---------        -----
     <S>                                             <C>            <C>               <C>
     Options outstanding at September 30, 2001         365,500      $.15 - $2.50      .9178
        Granted                                         23,000      $.15 - $ .68      .4230
        Exercised                                         -              -              -
        Forfeited                                       15,500      $.50 - $1.19      .7761
                                                     -----------
     Options outstanding at September 30, 2002         373,000      $.15 - $2.50      .8905
       Granted                                         281,000      $.15 - $ .93      .3449
       Exercised                                          -              -              -
       Forfeited                                       (21,500)     $.34 - $1.20      .7270
                                                     -----------
     Options outstanding at September 30, 2003         632,500      $.15 - $2.50      .6411
                                                     ===========
     Options exercisable at September 30, 2003         438,350      $.15 - $2.50      .7582
                                                     ===========
</TABLE>

The weighted average remaining contractual life of the stock options outstanding
at September 30, 2003 is 7.8 years.

At  September  30, 2003 the Company  has  reserved a total of 700,000  shares of
common stock for exercise of stock options.

The estimated  weighted  average grant date fair value of options granted during
fiscal years 2003 and 2002 using the  Black-Scholes  Model was $.49 and $.56 per
share, respectively.  For purposes of determining the fair value of each option,
the Company used the following assumptions:

                                                         2003           2002
                                                     -----------    -----------
        Risk-free interest rate                         3.92%          4.7%

        Volatility                                        62%          154%

        Expected life  (years)                            10            10




                                       23
<PAGE>



11.  EQUITY INVESTMENT IN AFFILIATE

The  Company  owns  a  28.4%  equity   interest  in  Sold-Rite   Holdings,   LLC
("Sold-Rite"),   a  U.S.  company.  A  substantial   portion  of  the  remaining
outstanding  shares are owned by the Chief Executive Officer and a member of the
Board of  Directors.  The Company  reports the  results of  Sold-Rite  using the
equity  accounting  method.  During 2003 and 2002, the Company invested $100,000
and $84,000 in  Sold-Rite.  All of the 2002  investment  amount was  expensed in
2002.  Sold-Rite  has  filed for a patent on a process  to  deliver  content  to
consumers via the Internet.  Sold-Rite  (Secure On Line Delivery Of  Recordings,
Information,  Text and  Entertainment)  holds the  promise  of  becoming a major
platform  from which  consumers  around the globe would  acquire  music,  films,
television  programs,  books,  games  and other  content  that  lends  itself to
electronic distribution.  In 2003, efforts were initiated to develop a prototype
of the product and  demonstrate  the product to potential  contributors  of both
technical and financial  support.  The potential of Sold-Rite is largely unknown
at this point in time and  depends  significantly  on the actual  issuance  of a
patent and marketplace acceptance.

Condensed  financial  information for Sold-Rite Holdings LLC is as follows as of
and for the year ended September 30, 2003:

        Current assets                    $   62,679
        Fixed assets                           1,887
                                          ----------
        Total assets                      $   64,566
                                          ==========

        Current liabilities               $     --
        Long-term liabilities                   --
                                          ----------
        Stockholders' equity              $   64,566
                                          ==========

        Net sales                         $     --
        Expenses                              35,434
                                          ----------
        Net loss                          $  (35,434)
                                          ==========

In January 2003, the FASB issued FASB  Interpretation  No. 46  "Consolidation of
Variable  Interest  Entities" ("FIN 46"), an  interpretation  of ARB No. 51. The
Company adopted FIN 46 effective July 1, 2003. This  interpretation  requires an
entity  to  consolidate  all  variable  interest  entities  (as  defined  by the
interpretation).  The Company has analyzed its  investment  in Sold-Rite and has
determined  that as of  September  30,  2003,  there would not be a  significant
difference between the equity method of accounting and consolidation

12.  OTHER MATTERS

In a meeting held September 22, 2003 the Board of Directors (the "Board"),  in a
unanimous  vote,  resolved  that, due to the increasing  costs  associated  with
compliance with the  Sarbanes-Oxley Act and other compliance issues, it would be
in the best interests of the  shareholders of the corporation to discontinue the
corporation  as a  reporting  company  under  the  statutes  and  rules  of  the
Securities  and Exchange  Commission and to no longer be a listed company on the
Over-the-Counter Bulletin Board. The Board further resolved that the officers of
the Company be directed to bring the  question  before the  stockholders  of the
Company for a vote.

Upon  ratification  of the resolution by the Board,  the holders of 69.6% of the
outstanding  Common  Stock of the  Company  executed  a written  consent  to the
adoption of the resolution  presented by the Board of Directors to do all things
necessary to implement this resolution including, but not limited to, the filing
of a Form 15 with the  Securities  and  Exchange  Commission.  Accordingly,  the
Company filed a Form 15 with an effective date of December 24, 2003.

13.  ADVERTISING BARTER TRANSACTIONS

The Company earned revenue of $2,273,168 and $1,665,337 and incurred  expense of
$824,031 and $603,684 from advertising  barter  transactions for the years ended
September 30, 2003 and 2002,  respectively.  The barter  revenue is derived from




                                       24
<PAGE>

13.  ADVERTISING BARTER TRANSACTIONS (Continued)

obtaining  airtime from radio stations in exchange for the sale of the Company's
products and marketing such airtime to advertisers.

14.  RELATED PARTY INFORMATION

The  Company  is a 28.4%  owner of Sold Rite  Holdings,  LLC (See  Note  11).  A
substantial  portion of the remaining  outstanding shares are owned by the Chief
Executive  Officer  of the  Company  and a  member  of the  Company's  Board  of
Directors.





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                                       25
<PAGE>

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

None.

                                    PART III

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

The Company has historically included the information contained in the Company's
2004 Information  Statement by reference.  However,  the Company filed a Form 15
with an effective  date of December 24, 2003.  Since it will be a  non-reporting
entity, the Company has no intention to file the 2004 Information  Statement and
they are not incorporating this statement by reference.

ITEM 10.  EXECUTIVE COMPENSATION

The Company has historically included the information contained in the Company's
2004 Information  Statement by reference.  However,  the Company filed a Form 15
with an effective  date of December 24, 2003.  Since it will be a  non-reporting
entity, the Company has no intention to file the 2004 Information  Statement and
they are not incorporating this statement by reference.

ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The Company has historically included the information contained in the Company's
2004 Information  Statement by reference.  However,  the Company filed a Form 15
with an effective  date of December 24, 2003.  Since it will be a  non-reporting
entity, the Company has no intention to file the 2004 Information  Statement and
they are not incorporating this statement by reference.

ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The Company has historically included the information contained in the Company's
2004 Information  Statement by reference.  However,  the Company filed a Form 15
with an effective  date of December 24, 2003.  Since it will be a  non-reporting
entity, the Company has no intention to file the 2004 Information  Statement and
they are not incorporating this statement by reference.

ITEM 13.  EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits:
3    (a)  Certificate of Incorporation and By-Laws (1)
     (b)  Certificate of Merger:  Video Image Inc. and TM  Communications,  Inc.
          (1)
     (c)  Certificate  of  Amendment  of  Certificate  of  Incorporation  of  TM
          Century,  Inc.  effective  March 27, 1992.  (Exhibit 1) (2) (March 31,
          1992)

10   Material Contracts:
     (a)  *Long  Term  Performance  Incentive  Plan of TM  Century,  Inc.  dated
          December 3, 1991. (Exhibit 10(bb))(4)
     (b)  *Consulting  Agreement  between TM Century,  Inc.  and Neil W. Sargent
          dated June 28, 1999. (Exhibit 10.3) (June 30, 1999)(2)
     (c)  *Amended and Restated 1991 Long Term Performance  Incentive Plan of TM
          Century dated July 2, 1999 (Exhibit 10h)(4)
     (d)  *TM Century,  Inc.  2000 Stock Option Plan  effective  March 20, 2000.
          (Exhibit 10.1) (March 31,  2000)(2)


                                       26
<PAGE>

     (e)  Lease  Agreement,  dated as of June 1,  2002 by and  between  AIP-SWAG
          Operating  Partnership,  L.P.  and TM  Century,  Inc.  (Exhibit  10.1)
          (September 30, 2002) (5)
     21   Subsidiaries
     31.1 Certification  of Chief Executive  Officer  Pursuant To Section 302 Of
          The Sarbanes-Oxley Act of 2002
     31.2 Certification  of Chief Financial  Officer  Pursuant To Section 302 Of
          The Sarbanes-Oxley Act of 2002
     32.1 Certification by R. David Graupner, Chief Executive Officer,  pursuant
          to 18 USC  Section  1350,  as adopted  pursuant  to Section 906 of the
          Sarbanes-Oxley Act of 2002.
     32.2 Certification by Teri R.S. James, Chief Financial Officer, pursuant to
          18 USC  Section  1350,  as  adopted  pursuant  to  Section  906 of the
          Sarbanes-Oxley Act of 2002.


Notes to Exhibits:

     (1)  Incorporated  by reference to the  similarly  numbered  exhibit to the
          Registration  Statement on Form S-18 (No. 2- 93588-FW),  filed October
          2, 1984, as amended.
     (2)  Incorporated  by reference to the  indicated  exhibit to the Quarterly
          Report on Form 10-Q for the indicated period, of the Registrant.
     (3)  Incorporated  by  reference  to the  indicated  exhibit  to the Annual
          Report on Form 10-K for the fiscal year ended September 30, 1991.
     (4)  Incorporated  by  reference  to the  indicated  exhibit  to the Annual
          Report on Form 10-KSB for the fiscal year ended September 30, 1999.
     (5)  Incorporated  by  reference  to the  indicated  exhibit  to the Annual
          Report on Form 10-KSB for the fiscal year ended September 30, 2002.


* The documents filed or incorporated by reference as Exhibits 10(a),  (b), (c),
and  (d)  hereto  constitute  management  contracts  or  compensatory  plans  or
arrangements.

(b) Reports on Form 8-K

No reports on Form 8-K were filed  during the fourth  quarter of the fiscal year
ended September 30, 2003.

ITEM 14.  CONTROLS AND PROCEDURES

Based on their  evaluation,  as of a date  within 90 days of the filing  date of
this Form 10-KSB,  the Company's  Chief  Executive  Officer and Chief  Financial
Officer have concluded that the Company's disclosure controls and procedures (as
defined in Rule 13a-14 (c) and 15d-14 (c) under the  Securities  Exchange Act of
1934,  as amended)  are  effective.  There have been no  significant  changes in
internal  controls or in other  factors  that could  significantly  affect these
controls  subsequent to the date of their  evaluation,  including any corrective
actions with regard to significant deficiencies and material weaknesses.















                                       27
<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.

                                                        Dated: December 23, 2003

                                                        TM CENTURY, INC.

                                                        BY:/s/Teri R.S. James
                                                        ---------------------
                                                        Teri R.S. James
                                                        Chief Financial Officer

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

                                                               DATE:

/s/Teri R.S. James                                             December 23, 2003
------------------
TERI R.S. JAMES, Chief Financial Officer
(Principal financial and accounting officer)


/s/R.David Graupner                                            December 23, 2003
-------------------
R. DAVID GRAUPNER, President and Chief Executive Officer
(Principal executive officer)


/s/Marjorie L. McIntyre                                        December 23, 2003
-----------------------
MARJORIE L. MCINTYRE, Chairman of the Board of Directors


/s/A. Ann Armstrong                                            December 23, 2003
A. ANN ARMSTRONG, Director


/s/Carol M. Long                                               December 23, 2003
----------------
CAROL LONG, Director


/s/Michael Cope                                                December 23, 2003
------------------
MICHAEL COPE, Director














                                       28