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

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

                                    FORM 10-Q


[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934

     For the quarterly period ended               March 31, 2003
                                             ------------------------

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

     For the transition period from                  to
                                       -------------    --------------

                         Commission File Number: 0-18450

              ----------------------------------------------------
                               COLOR IMAGING, INC.
              ----------------------------------------------------
             (Exact name of registrant as specified in its charter)

              DELAWARE                                 13-3453420
   -------------------------------          -----------------------------------
(State  or  other  jurisdiction  of         (I.R.S. Employer Identification No.)
   incorporation or organization)

        4350 PEACHTREE INDUSTRIAL BOULEVARD, SUITE 100
        NORCROSS, GEORGIA 30071                                        30071
       -----------------------------------------------            ----------
       (Address of principal executive offices)                   (Zip code)


                       (770) 840-1090 FAX (770) 242-3494
                       ---------------------------------
              (Registrant's telephone number, including area code)


     Indicate  by check mark  whether the  registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.         Yes    X   No
                                            -----      -----
     Indicate by check mark whether the registrant is an  accelerated  filer (as
defined in Rule 12b-2 of the  Securities  Exchange  Act of 1934).  Yes
                                                                       ----
No  X
   ----

     As of April  21,  2003,  there  were  12,937,965  shares  of  Common  Stock
outstanding.



<PAGE>


                               COLOR IMAGING, INC.
                         QUARTERLY REPORT ON FORM 10-Q
                FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2003
                                      INDEX



PART I:   FINANCIAL INFORMATION

Item 1.   Financial Statements

          Condensed Balance Sheets at March 31, 2003
          (Unaudited) and December 31, 2002(Audited)..........................3
          Condensed Statements of Operations (Unaudited)
          for the Three Months ended March 31, 2003 and 2002..................4
          Condensed Statements of Cash Flows (Unaudited)
          for the Three Months ended March 31, 2003 and 2002..................5
          Notes to Interim Unaudited Condensed Financial
          Statements .........................................................6

Item 2.   Management's Discussion and Analysis of Financial
          Condition and Results of Operations.................................9
Item 3.   Quantitative and Qualitative Disclosures about Market Risks........23
Item 4.   Controls and Procedures ...........................................23



PART II:  OTHER INFORMATION

Item 1.   Legal Proceedings .................................................24
Item 2.   Changes in Securities and Use of Proceeds..........................24
Item 3.   Defaults Upon Senior Securities....................................26
Item 4.   Submission of Matters to a Vote of Security Holders................26
Item 5.   Other information .................................................26
Item 6.   Exhibits and Reports on Form 8-K...................................26
Signatures...................................................................31
Certifications...............................................................32



                                       2
<PAGE>


PART I: FINANCIAL INFORMATION
ITEM 1 -FINANCIAL STATEMENTS

                               COLOR IMAGING, INC.
                            CONDENSED BALANCE SHEETS

<TABLE>
<CAPTION>
                         ASSETS
<S>                                                             <C>              <C>
                                                                  31-Mar-03        31-Dec-02
                                                                 (Unaudited)       (Audited)
                                                                ------------     ------------
CURRENT ASSETS
    Cash                                                        $  3,210,171     $    128,501
    Accounts receivable, net                                       2,274,564        2,390,019
    Inventory                                                      4,917,009        5,080,237
    Related party portion of IDR bond                                 83,160           83,160
    Other current assets                                             282,251          304,672
                                                                ------------     ------------
          TOTAL CURRENT ASSETS                                    10,767,155        7,986,589
                                                                ------------     ------------

PROPERTY, PLANT AND EQUIPMENT - NET                                6,949,209        7,038,111
                                                                ------------     ------------
OTHER ASSETS
    Related party portion of IDR bond                                735,340          735,340
    Deferred offering costs                                               --          121,924
    Other assets                                                     228,026          231,571
                                                                ------------     ------------
          TOTAL OTHER ASSETS                                         963,366        1,088,835
                                                                ------------     ------------
                                                                $ 18,679,730     $ 16,113,535
                                                                ============     ============
          LIABILITIES & STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
    Revolving credit lines                                      $         --     $  1,022,470
    Accounts payable                                               2,700,384        3,543,680
    Current portion of notes payable                                   5,290          363,789
    Current portion of bonds payable                                 350,000          350,000
    Notes payable - related parties                                  332,490          401,937
    Other current liabilities                                        481,692          507,782
                                                                ------------     ------------
           TOTAL CURRENT LIABILITIES                               3,869,856        6,189,658
                                                                ------------     ------------
LONG TERM LIABILITIES
    Notes payable                                                     15,759          989,667
    Bonds payable                                                  3,095,000        3,095,000
    Notes payable - related parties                                  416,563          598,063
    Deferred tax liability                                            72,000               --
                                                                ------------     ------------
          LONG TERM LIABILITIES                                    3,599,322        4,682,730
                                                                ------------     ------------
           TOTAL LIABILITIES                                       7,469,178       10,872,388
                                                                ------------     ------------
COMMITMENTS & CONTINGENCIES

STOCKHOLDERS' EQUITY
   Common stock, $.01 par value,  authorized  20,000,000
     shares;  12,908,333 and 8,437,965 shares issued and
     outstanding on March 31, 2003 and
     December 31, 2002, respectively                                 129,083           84,380
   Additional paid-in capital                                     13,019,069        7,205,909
   Accumulated deficit                                            (1,937,600)      (2,049,142)
                                                                ------------     ------------
          TOTAL STOCKHOLDERS' EQUITY                              11,210,552        5,241,147
                                                                ------------     ------------
                                                                $ 18,679,730     $ 16,113,535
                                                                ============     ============
</TABLE>
                                      See accompanying notes

                                       3
<PAGE>


                               COLOR IMAGING, INC.
                       CONDENSED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
<S>                                                 <C>               <C>

                                                     THREE MONTHS ENDED MARCH 31,
                                                        2003               2002
                                                    ------------      ------------

    SALES                                           $ 5,629,405       $ 7,661,323

    C0ST OF SALES                                     4,310,155         6,438,288
                                                    ------------      ------------
    GROSS PROFIT                                      1,319,250         1,223,035
                                                    ------------      ------------

    OPERATING EXPENSES

        Administrative                                  466,647           365,475

        Research & development                          271,967           211,484

        Sales & marketing                               367,274           276,252
                                                    ------------      ------------
                                                      1,105,888           853,211
                                                    ------------      ------------

    INCOME FROM OPERATIONS                              213,362           369,824
                                                    ------------      ------------

    OTHER INCOME  (EXPENSE)

        Other income                                     48,146             6,877

        Financing expenses                              (75,966)          (74,954)
                                                    ------------      ------------
                                                        (27,820)          (68,077)
                                                    ------------      ------------

    INCOME BEFORE TAXES                                 185,542           301,747

    PROVISION FOR INCOME TAXES                           74,000           115,250
                                                    ------------      ------------
    NET INCOME FROM
    CONTINUING OPERATIONS                               111,542           186,497

    DISCONTINUED OPERATIONS (Note 2)
        (Loss) from operations of
           subsidiary disposed of -
           net of income taxes                               --           (70,258)
                                                    ------------      ------------

    NET INCOME                                      $   111,542        $  116,239
                                                    ============      ============

         INCOME (LOSS)
         PER COMMON SHARE - BASIC
            Continuing operations                   $       .01        $      .02
            Discontinued operations                 $        --        $     (.01)
                                                    ------------      ------------
                                                    $       .01        $      .01
                                                    ============      ============
         INCOME (LOSS)
         PER COMMON SHARE - DILUTED
           Continuing operations                    $       .01        $      .02
           Discontinued operations                  $        --        $     (.01)
                                                    ------------      ------------
                                                    $       .01        $      .01
                                                    ============      ============
         WEIGHTED AVERAGE
         SHARES OUTSTANDING
           Basic                                      9,332,780        10,099,880
           Assumed conversion                                --           101,613
                                                    ------------      ------------
                                                      9,332,780        10,201,493
                                                    ============      ============
</TABLE>
                             See accompanying notes


                                       4
<PAGE>

                               COLOR IMAGING, INC.
                       CONDENSED STATEMENTS OF CASH FLOWS

                                   (UNAUDITED)

<TABLE>
<CAPTION>
<S>                                                     <C>            <C>

                                                       THREE MONTHS ENDED MARCH 31,
                                                             2003           2002
                                                        -----------    -----------

Cash flows from operating activities:
  Net income from continuing operations                $    111,542   $    186,497
  Adjustments to reconcile net income to net cash
    (used in) provided by operating activities:
        Depreciation and amortization                       146,726        132,378
        Deferred income taxes                                72,000         33,001
    Decrease (increase) in:
        Accounts receivable and other receivables           115,455       (362,350)
        Inventories                                         163,228        210,573
        Prepaid expenses and other assets                   147,891         (4,553)
    Increase (decrease) in:
        Accounts payable and accrued liabilities           (869,387)       (20,886)
                                                       -------------  -------------
        Net cash (used in) provided by
               continuing operations                       (112,545)       174,660

   Net cash flows of discontinued operations                     --       (167,219)
                                                       -------------  -------------
        Net cash (used in) provided by
               operating activities                        (112,545)         7,441
                                                       -------------  -------------

Cash flows (used in) investing activities:
     Capital expenditures                                   (57,824)      (248,136)
     Other assets                                                --             --
                                                       -------------  -------------
        Net cash (used in)
             investing activities                           (57,824)      (248,136)
                                                       -------------  -------------
Cash flows from financing activities:
  Net (payments) under line of credit                    (1,022,470)       (30,724)
  Net proceeds from sale of common stock                  5,917,086        143,351
  Repurchase of common shares and warrants                  (59,223)            --
  Net proceeds under related party borrowings                    --        500,000
  Net (payments) under related party borrowings            (250,947)            --
  Principal payments of long-term debt                   (1,332,407)       (82,403)
                                                       -------------  -------------
         Net cash provided by
             financing activities                         3,252,039        530,224
                                                       -------------  -------------
         Net increase in cash                             3,081,670        289,529

Cash at beginning of year                                   128,501        393,981
                                                       -------------  -------------
Cash at end of period                                   $ 3,210,171    $   683,510
                                                       =============  =============

Supplemental disclosure of cash flow Information:
         Cash paid during the period for:
         Interest and financing expense                 $    80,545    $    67,238
                                                       =============  =============
         Income taxes                                   $         0    $         0
                                                       =============  =============
</TABLE>
                             See accompanying notes


                                       5
<PAGE>

                              COLOR IMAGING, INC.
                NOTES TO INTERIM CONDENSED FINANCIAL STATEMENTS
                                   March 31,
                                2003 (Unaudited)

NOTE 1. BASIS OF PRESENTATION

The accompanying  unaudited  interim  condensed  financial  statements have been
prepared in accordance  with  accounting  principles  generally  accepted in the
United  States  of  America  for  interim  financial  information  and  with the
instructions  to  Form  10-Q.  Accordingly,  they  do  not  include  all  of the
information and footnotes required by accounting  principles  generally accepted
in the United  States of  America  for  complete  financial  statements.  In the
opinion of management,  all adjustments (consisting of normal recurring accruals
and  adjustments)  considered  necessary  for  a  fair  presentation  have  been
included.  Operating  results for the three  months ended March 31, 2003 are not
necessarily  indicative  of the results  that may be expected for the year ended
December 31, 2003.

NOTE 2. DISCONTINUED OPERATIONS

On September 30, 2002,  the Company  completed a share  exchange  agreement with
Digital Color Print, Inc. and four of its former directors,  whereby the Company
received  1.7  million  shares of its common  stock in  exchange  for all of the
shares of the common stock of its subsidiary,  Logical Imaging  Solutions,  Inc.
Based  upon  guidance  provided  by APB 29 in  connection  with  accounting  for
nonmonetary  transactions,  the fair value of the 1.7  million  shares of common
stock received was approximately  $2,678,993;  the fair value (approximating the
net book value) of Logical Imaging  Solutions,  Inc. plus the transaction  costs
incurred.

Following  is  summary  financial  information  for the  Company's  discontinued
Logical Imaging Solutions, Inc. subsidiary:

<TABLE>
<CAPTION>
<S>                                                      <C>                 <C>
                                                           For the Three Months Ended
                                                                    March 31,
                                                         -------------------------------
                                                            2003                 2002
                                                         -----------         -----------
     (Loss) from discontinued operations:
        Before income taxes                              $      --            $(105,502)
        Income tax provision (benefit)                          --              (35,244)
                                                         -----------         -----------
     Net (loss) from discontinued operations             $      --            $( 70,258)
                                                         ===========         ===========
</TABLE>

Pursuant to the share exchange agreement, the Company also received a warrant to
purchase approximately 15% of the then outstanding common stock of Digital Color
Print, Inc. or Logical Imaging Solutions, Inc. The warrant has not been assigned
any value,  since it is not cashless,  increases from $1.50 to $2.25 and then to
$3.25 per share each year over three years,  expires  after three years,  is not
registered for resale and has no current market.

NOTE 3. COMMON STOCK AND EQUIVALENTS

On February 27, 2003,  the Company  entered into an agreement with a stockholder
to repurchase  150,000  shares of common stock and warrants to purchase  300,000
shares of the Company's  common stock for an aggregate  cost of $300,000.  Under
the agreement,  the  stockholder  has a one-time right to cancel the sale of the
common stock and warrants not yet paid for by the Company upon written notice to
the  Company.  Upon  receipt of such  notice,  the Company is not  obligated  to
purchase the remaining  common stock and warrants.  The agreement  provides that
the  Company is to pay $2.00 for each common  share and warrant to purchase  two
common shares of the Company's  common stock.  The shares and warrants are to be
repurchased in approximately  equal installments over nine months,  beginning in
March and ending in November  2003. On March 24, 2003,  the Company  repurchased
16,672 of the Company's  common  shares and warrants to purchased  33,344 common
shares,  paying $33,344.  The shares and warrants repurchased by the Company are
held in escrow,  pending the  completion of the  repurchase in November 2003, or
its earlier cancellation,  at which time they will be cancelled.  The shares and
warrants  repurchased  to date  are  reflected  as if  cancelled  as of the date
hereof.

                                       6
<PAGE>


NOTE 3. COMMON STOCK (CONTINUED)

On March 4, 2003,  the Company  completed the  repurchase  from a stockholder of
12,939 shares of the Company's  common stock  together with warrants to purchase
25,878 shares of the Company's common stock at an aggregate cost of $25,878. The
shares and warrants were originally sold in the Company's private placement that
was completed in December 2001,  and the shares and warrants  repurchased by the
Company were cancelled.

On March 13, 2003, the Company  completed the public sale of 4,500,000 shares of
the Company's  common stock at a price of $1.35 per share (see note 10), whereby
the Company received $5,917,086 in net proceeds.

During the three  months  ended  March 31,  2003,  the Company did not grant any
options to employees.  The following is a summary of total  outstanding  options
and stock warrants at March 31, 2003:

<TABLE>
<CAPTION>
<S>                           <C>           <C>                <C>                           <C>           <C>
                                      Options and Warrants Outstanding                    Options and Warrants Exercisable
                                                                 Weighted-Average
Range of Exercise                           Weighted-Average        Remaining                              Weighted-Average
    Prices                     Number       Exercise Price     Contractual Life               Number        Exercise Price
---------------------         ---------     ----------------   -------------------           ---------     ----------------
Options $2.00-$2.75             920,000           $2.34             4.80 years                 718,750           $2.28
Warrants $2.00                  901,993           $2.00             0.85 years                 901,993           $2.00
                              ---------                                                      ---------
Options and warrants          1,821,993           $2.17             3.40 years               1,620,743           $2.12
                              =========                                                      =========
</TABLE>

On April 18,  2003,  the Company  granted  options to two  directors to purchase
25,000  shares of the  Company's  common stock at an exercise  price of $.45 per
share.  The options  vest at the rate of 5,000 per year  beginning  on the first
anniversary  date of the grant and  continuing  annually  thereafter  and expire
three years from their respective date of vesting.


NOTE 4. INVENTORIES

Inventories  consisted  of the  following  components  as of March 31,  2003 and
December 31, 2002:

                                    March 31, 2003            December 31, 2002
                                 ------------------           -----------------
        Raw materials              $       764,324             $       427,752
        Work-in-process                  1,310,099                   1,021,496
        Finished goods                   2,952,550                   3,665,953
        Obsolescence allowance            (109,964)                    (34,964)
                                  -----------------           -----------------
            Total                  $     4,917,009             $     5,080,237
                                  =================           =================


NOTE 5. CHANGES TO BORROWING ARRANGEMENTS

The Company has a $1.5 million  revolving  line of credit,  as amended,  with an
outstanding balance as of March 31, 2003 of $0. At the end of each month for the
following  month,  the  Company has the  interest  rate option of either the one
month Libor  interest  rate in effect two business  days before the first day of
the month plus 2.50% or the Bank's prime interest rate minus 0.25%.  As of March
31, 2003,  the interest rate was the one-month  Libor rate of 1.2275% plus 2.50%
(3.8375%). This revolving line of credit has a June 30, 2003 expiration date.

Under  the line of  credit,  the  Company  is  permitted  to borrow up to 85% of
eligible  accounts  receivable and 50 percent of eligible  inventories  (up to a
maximum of $1.1 million and not to exceed 60 percent of the total  outstanding).
The Company has  granted  the Bank a security  interest in all of the  Company's
assets as security for the repayment of the line of credit.  The Bank  agreement
contains various covenants which the Company is required to maintain,  and as of
March 31, 2003, the Company was in compliance with these covenant requirements.


                                       7
<PAGE>


NOTE 6. SIGNIFICANT CUSTOMERS

In the three month period ended March 31, 2003, two customers  accounted for 33%
and 19%, respectively, of net sales. The Company does not have a written or oral
contract  with these  customers.  All sales are made  through  purchase  orders.
Accounts  receivable  from these  customers at March 31, 2003, were $847,711 and
$325,349, respectively.


NOTE 7. SIGNIFICANT SUPPLIERS

In the three months ended March 31, 2003,  the Company  purchased 41% of its raw
materials, components and supplies from one supplier in connection with sales to
its largest customers.  At March 31, 2003, the accounts payable to this supplier
was $1,365,836.


NOTE 8. FINANCIAL REPORTING FOR BUSINESS SEGMENTS:

The  Company  believes  that its  operations  are in a single  industry  segment
involving  the  development  and  manufacture  of  products  used in  electronic
printing.  All of the Company's  assets are domestic.  The sales to unaffiliated
customers by geographic  region from  continuing  operations for the three-month
periods ended March 31 are as follows:

                                            2003            2002
                                        -----------     -----------
Sales to Unaffiliated Customers:
United States                           $ 3,314,623     $ 4,987,555
Europe                                    1,142,286       1,568,622
Mexico                                      670,635         650,299
Asia                                        236,943         175,555
All Others                                  264,918         279,292
                                        -----------     -----------
Total                                   $ 5,629,405     $ 7,661,323
                                        ===========     ===========


NOTE 10. RELATED PARTY TRANSACTIONS:

The Company  purchased  from an  affiliate  for the three months ended March 31,
2003,  $452,524 of injection  molded  cartridges and accessories for copiers and
laser  printers.  Accounts  payable  to the  affiliate  at March 31,  2003,  was
$332,449.

On January 23, 2003 the Company's  registration  statement on Form SB-2 offering
of up to 7 million  shares of its common  stock was  declared  effective  by the
Securities  and  Exchange  Commission.  On March 6, 2003,  the Company  received
subscription  gross proceeds from an affiliate of $6,075,000 for the public sale
of  4,500,000  shares of its common  stock from an  affiliate,  and on March 13,
2003,  the Company  accepted  the  investment  in  accordance  with the offering
procedures.


                                       8
<PAGE>


ITEM 2.

MANAGEMENT'S  DISCUSSION  AND  ANALYSIS OF  FINANCIAL  CONDITION  AND RESULTS OF
OPERATIONS

The  following  discussions  should be read in  conjunction  with our  condensed
financial statements and the related notes thereto.

BACKGROUND

On June 28, 2000,  Color  Imaging,  formerly known as Advatex  Associates,  Inc.
merged with Logical Imaging  Solutions,  Inc. and Color Image,  Inc. and Logical
Imaging Solutions and Color Image became  wholly-owned  subsidiaries of Advatex.
The financial  information  contained in this report is in  conformity  with the
purchase method of accounting. On December 31, 2000, Color Image was merged with
and into Color  Imaging.  On September  30, 2002,  we divested  Logical  Imaging
Solutions in exchange for 1.7 million shares of our common stock and warrants to
purchase up to 15% of the common stock of Digital Color Print or Logical Imaging
Solutions. As the result of our disposing of Logical Imaging Solutions,  Inc. we
no longer offer printing systems to commercial printers nor the support services
and  consumables  related  thereto.  As a  further  result  of  Color  Imaging's
divestiture of Logical Imaging  Solutions,  our investments in the furthering of
Logical Imaging Solutions' technologies and carrying its operations have ceased.
Significantly,  since the merger on June 28,  2000,  Color  Imaging had invested
approximately  $2.35 million in the operations of Logical Imaging  Solutions and
the development of its  technologies.  The disposal of Logical Imaging Solutions
eliminates the capital  needed to support those  operations and should result in
improved profitability from operations.

COLOR IMAGING, INC.

Color Imaging,  Inc. has developed and manufactured  products used in electronic
printing.  We formulate and produce black text and specialty  toners,  including
color and magnetic character recognition toners for numerous laser printers. Our
toners permit the printing of a wide range of user-selected  colors and also the
full  process  color  printing  of cyan,  yellow,  magenta  and black.  Magnetic
character recognition toners enable the printing of magnetic characters that are
required for the high-speed  processing of checks and other financial documents.
We also supply  other  consumable  products  used in  electronic  printing,  and
photocopying,  including toner cartridges, cartridge components,  photoreceptors
and imaging drums.

Color Imaging,  Inc. has continually expanded its product line and manufacturing
capabilities.  This expansion has led to the creation of more than 130 different
black  text,  color,   magnetic   character   recognition  and  specialty  toner
formulations, including aftermarket toners and imaging products for printers and
facsimile machines manufactured by Brother(TM),  Canon(TM), Delphax(TM), Hewlett
Packard(TM), IBM(TM), Lexmark(TM),  Sharp(TM), Xerox(TM), Minolta(TM), Mita(TM),
Panafax(TM),    Pentax(TM),   Pitney   Bowes(TM),   Epson(TM),   Fuji-Xerox(TM),
Toshiba(TM),  Kyocera(TM),  Okidata(TM),  Panasonic(TM),  and  printing  systems
developed  by  Logical  Imaging  Solutions,   Inc.  Color  Imaging,   Inc.  also
manufacturers  and or  markets  toners for use in Ricoh,  Sharp(TM),  Xerox(TM),
Canon(TM),   Lanier(TM)  and   Toshiba(TM)   copiers.   We  also  offer  product
enhancements,  including imaging supplies that enable standard laser printers to
print magnetic  character  recognition data. We market branded products directly
to  OEMs  and  our   aftermarket   products   worldwide  to   distributors   and
remanufacturers   of  laser  printer  toner   cartridges   and  to  dealers  and
distributors of copier products.

Our strategy for growing  revenue and operating  profit is to expand,  including
through strategic acquisition(s),  our printer and copier products business. The
key  elements  of our  strategy  are  (1)  increasing  vertical  integration  by
supplying complete toner and cartridge devices, (2) capitalizing on our research
and development  expertise of producing specialty,  color and digital copier and
or  multifunctional  device toners,  (3) exploiting the efficiencies  associated
with the investment made in manufacturing facilities,  (4) expanding our sources
for products from  strategic  suppliers  that we can add value to or resell that
complement our product lines and (5) expanding into new geographic markets,  and
broadening our sales channels.

RECENT DEVELOPMENTS

On April 18, 2003,  the Board of Directors of Color Imaging  reviewed the recent
trading  activity and prices of our common stock on the OTC Bulletin Board.  The
Board of Directors then approved a stock  repurchase  program  pursuant to which
the we are  authorized  to  purchase  in  the  open  market,  private  or  other

                                       9
<PAGE>

transactions,  up to  the  lesser  of $1  million  or 1  million  shares  of our
outstanding shares of common stock.

Repurchases under the program are to be made from time to time at the discretion
of management and as market conditions warrant.  The repurchase program does not
obligate us to acquire any specific  number of shares and may be discontinued at
any time. There is no guarantee as to the exact number of shares,  if any, to be
repurchased by us prior to the completion of the repurchase program. Our present
plan is to cancel any shares repurchased,  making them available for reissue for
any general corporate purpose,  and to complete the repurchases by September 30,
2004.  All  purchases  will be in  accordance  with the  terms,  conditions  and
restrictions contained in SEC Rule 10b-18.

On January 23, 2003 Color Imaging,  Inc.'s  registration  statement on Form SB-2
offering of up to 7 million shares of common stock was declared effective by the
Securities and Exchange  Commission.  On March 6, 2003,  Color Imaging  received
subscription  proceeds of $6,075,000 for the public sale of 4,500,000  shares of
its common stock from an affiliate.  The acquisition of our common stock by this
affiliate is for investment purposes.  On March 13, 2003, Color Imaging accepted
the  investment in accordance  with the offering  procedures  and terminated the
offering without accepting any other subscriptions.

OVERVIEW

The following  discussion and analysis  should be read in  conjunction  with our
financial  data and our Financial  Statements and notes  appearing  elsewhere in
this report.

Net sales for the three months ended March 31, 2003 declined by approximately $2
million, or 26%, to $5.6 million, compared to $7.7 million in 2002. Net sales in
2003 decreased  primarily due to reduced demand  domestically and  substantially
reduced sales to our largest customer for the first quarter 2003 compared to the
same period of 2002. In the three months ended March 31, 2003 and 2002,  our net
sales were primarily generated from the sale of finished consumable products for
electronic  printers and photocopying  machines and comprised  approximately 71%
and 69% of net sales,  respectively.  For the three  months ended March 31, 2003
and 2002, our two largest imaging products  customers  accounted for 33% and 19%
and 49% and 21% of net sales,  respectively.  Sales to these  customers  consist
primarily  of analog  copier  products,  and as a result are expected to decline
over time unless these declining sales to these customers are offset by the sale
of digital copier products.

As of  September  30, 2002,  we no longer sell  certain  very low margin  copier
products  purchased for resale to our largest customer.  As a result,  our sales
will be less concentrated with our largest customer and our gross profit margins
are  expected  to  improve.  Our  orders for this  discontinued  very low margin
product during 2002 were approximately $4 million, or 14% of our total sales for
the year ended December 31, 2002 and represents  approximately  33% of our sales
for 2002 to our  largest  customer.  During the fourth  quarter of 2002,  as the
result  of our  largest  customer  having  lost  business  from one of its major
customers  that has been using our  product,  orders from our  largest  customer
further  declined and we expect sales to our largest  customer during 2003 to be
about one-half of the amount sold to them during 2002, or down  approximately $7
million.  We do not have a written  or oral  contract  with this  customer.  Our
inventory  for  the  discontinued  product  has  been  sold,  and  inventory  in
connection with the other products no longer sold by our largest customer to one
its customers is still being sold to our largest customer for sale to others. We
do not have written or oral contracts with our customers, and all sales are made
through  purchase  orders.  Though  our  sales  are on  purchase  orders,  these
customers typically issue purchase orders three months in advance of the product
delivery  date and provide us with an  additional  two month  rolling  forecast.
Consistent  with the purchase  orders and forecasts  provided to us by our major
customers,  we provide our major  suppliers with purchase orders three months in
advance and an additional rolling forecast for two months.

Net sales made  outside of the United  States  decreased to  approximately  $2.3
million,  or 41% of total  sales  for the three  months  ended  March 31,  2003,
compared to $2.7 million, or 35% for the three months ended March 31, 2002. This
15% decrease in  international  sales  resulted  primarily  from the decrease in
sales  to our two  largest  customers.  However,  as a result  of our no  longer
selling certain copier products to our largest  customer,  both our domestic and
our  international  sales are  expected to decrease  for all of 2003,  while our
gross margin is expected to be higher throughout 2003 when compared to 2002.

The following table reflects the consolidated new orders,  net of cancellations,
revenues and backlog as of the beginning and end of the three months ended March
31, 2003, as well as for Color Imaging's two general product lines.

                                       10
<PAGE>




                              Backlog                            Backlog
                             at start                             at end
                                of         New         Net          of
                               Year       Orders     Revenue     Quarter
                             --------    --------    --------    --------
                                         (IN THOUSANDS OF DOLLARS)
2003:
  Copier Products            $  2,718    $  2,953    $  3,562    $  2,109
  Printer Products                473       2,051       2,067         457
                             --------    --------    --------    --------
     Total                      3,191       5,004       5,629       2,566
                             ========    ========    ========    ========

CRITICAL ACCOUNTING ESTIMATES

"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations"  discusses  our  financial  statements  that have been  prepared  in
accordance with accounting principles generally accepted in the United States of
America.  The  preparation  of these  financial  statements  requires us to make
estimates  and  assumptions  that  affect  the  reported  amount of  assets  and
liabilities  at  the  date  of  the  financial  statements,  the  disclosure  of
contingent  assets and  liabilities at the date of the financial  statements and
the reported amounts of revenues and expenses during the reporting period.

On an on-going basis,  we evaluate our estimates and judgments,  including those
related to revenue recognition,  valuation allowances for inventory and accounts
receivable,  warranty and impairment of long-lived assets. We base our estimates
and  judgments on  historical  experience  and on various  other factors that we
believe to be reasonable under the circumstances.  The result of these estimates
and judgments form the basis for making  conclusions about the carrying value of
assets and liabilities that are not readily apparent from other sources.  Actual
results  may  differ  from  these  estimates  under  different   assumptions  or
conditions.  Our  significant  estimates  and  assumptions  are reviewed and any
required adjustments are recorded on a quarterly basis.

A critical  accounting  policy is one that is both important to the portrayal of
Color Imaging's financial  condition and results and requires  management's most
difficult,  subjective  or complex  judgments,  often as a result of the need to
make  estimates  about the  effect of  matters  that are  inherently  uncertain.
Management  believes the following critical  accounting policies affect its more
significant  judgments  and  estimates  in  the  preparation  of  its  financial
statements.

VALUATION ALLOWANCE FOR ACCOUNTS RECEIVABLE. We maintain allowances for doubtful
accounts for estimated  losses  resulting from the inability of our customers to
make required  payments.  These  allowances are based on historical  experience,
credit  evaluations and specific customer  collection issues we have identified.
Since our accounts  receivable are often concentrated in a relatively few number
of customers, a significant change in the liquidity or financial position of any
one  of  these   customers   could  have  a  material   adverse  impact  on  the
collectibility of our accounts receivable and our future operating results.

INVENTORY VALUATION.  Our inventories are recorded at the lower of standard cost
or the current  estimated  market value. As with any manufacturer or wholesaler,
economic conditions,  cyclical customer demand, product introductions or pricing
changes of our competitors and changes in purchasing or distribution  can affect
the  carrying  value  of  inventory.  Demand  for our  products  has  fluctuated
significantly and may do so in the future,  which could result in an increase in
the cost of inventory or an increase in excess inventory  quantities on hand. As
circumstances  warrant, we record lower of cost or market inventory adjustments.
In some instances these  adjustments can have a material effect on the financial
results of an annual or interim period.  In order to determine such adjustments,
we evaluate the age,  inventory turns,  estimated fair value and, in the case of
toner products,  whether or not they can be reformulated and  manufactured  into
other products, and record any adjustment if estimated fair value is below cost.
Through  periodic  review of each of our  inventory  categories  and by offering
markdown or closeout pricing,  we regularly take steps to sell off slower moving
inventory  to  eliminate  or  lessen  the  effect of any lower of cost or market
adjustment.  If assumptions  about future demand or actual market conditions are
less  favorable  than those  projected by  management,  write-downs of inventory
could be required,  and there can be no assurance that future  developments will
not necessitate further write-downs.

                                       11
<PAGE>

VALUATION OF LONG-LIVED  ASSETS.  We  periodically  evaluate  whether events and
circumstances  have occurred  which may affect the estimated  useful life or the
recoverability  of the remaining balance of our long-lived  assets,  such as our
investment in our toner  manufacturing  equipment.  We have  approximately  $7.8
million invested in such equipment and plant improvements, with a carrying value
of $6.5  million,  that  have  estimated  lives of up to  twenty  years.  Should
competing   technologies  or  offshore   competitors   cause  our  manufacturing
technology  to be  non-competitive,  or should  other  events  or  circumstances
indicate that the carrying amount of these assets would not be recoverable,  the
estimated life of these assets may need to be shortened and their carrying value
could be materially affected. If the sum of the undiscounted expected cash flows
from an asset to be held and used in operations is less than the carrying  value
of the asset, an impairment loss is recognized.

WARRANTY.  We provide a limited  warranty,  generally  ninety (90) days,  to all
purchasers  of our  products.  Accordingly,  we do not make a provision  for the
estimated  cost of providing  warranty  coverage,  and instead we expense  these
costs as they are  incurred.  On  occasion,  we have  been  required  and may be
required in the future to provide  additional  warranty  coverage to ensure that
our products are ultimately accepted or to maintain customer goodwill. While our
warranty costs have historically not been significant,  we cannot guarantee that
we will continue to experience a similar level of predictability  with regard to
warranty  costs as we have in the past. In addition,  the  introduction  of more
expensive finished products, technological changes or previously unknown defects
in raw  materials  or  components  may  result in more  extensive  and  frequent
warranty claims than anticipated,  which could have a material adverse impact on
our  operating   results  for  the  periods  in  which  such  additional   costs
materialize.

RESULTS OF CONTINUING OPERATIONS

Color Imaging's net sales were $5.6 million for the three months ended March 31,
2003,  a decrease of  approximately  27% from March 31,  2002.  The net sales by
product category were as follows:

<TABLE>
<CAPTION>
<S>                                  <C>         <C>    <C>          <C>         <C>
                                                        % Increase
 (Dollars in thousands)                 2003       %    (Decrease)      2002       %
                                     ----------  -----  ----------   ----------  -----
Product Category:
 Cartridges and bottles
  Copier finished products            $ 3,051     54%      (30%)      $ 4,339     57%
  Printer finished products               966     17%      ( 1%)          979     12%
                                     ----------         ----------   ----------
                                        4,017     71%      (24%)        5,318     69%

Bulk toner and parts                    1,612     29%      (31%)        2,343     31%
                                     ----------         ----------   ----------
      Total net revenue               $ 5,629    100%      (27%)      $ 7,661    100%
                                     ==========         ==========   ==========
</TABLE>

The following  table sets forth certain  information  derived from the Company's
unaudited interim statements of operations:

                                                        THREE MONTHS ENDED
                                                             MARCH 31,
                                                      2003            2002
                                                      -----           -----
                                                    (PERCENTAGE OF NET SALES)

    Net sales                                          100             100
    Cost of sales                                       77              84
    Gross profit                                        23              16
    Administrative expenses                              8               5
    Research and development                             5               3
    Sales and marketing                                  6               3
    Operating income                                     4               4
    Interest expense                                     1               1
    Depreciation and amortization                        3               2
    Income before taxes                                  3               4
    Provision for income taxes                           1               2
    Income from continuing operations                    2               2
    Loss  from  discontinued operations, net  of
      income taxes                                       -              -1
    Net income                                           2               1

                                       12
<PAGE>

RESULTS OF CONTINUING OPERATIONS

THREE MONTHS ENDED MARCH 31, 2003 COMPARED TO THREE MONTHS ENDED MARCH 31, 2002

NET SALES.  Our net sales  decreased by $2 million,  or 26%, to $5.6 million for
the three months  ended March 31,  2003,  from $7.7 million for the three months
ended March 31, 2002.  Net sales made in the United States were $3.3 million,  a
decrease of $1.7  million,  or 33%,  from $5.0  million  made in the  comparable
period in 2002.  Net sales  made  outside  of the  United  States  decreased  by
approximately $0.4 million, or 15%, for the quarter compared to the same quarter
of 2002.  The  decrease in net sales for the quarter  compared to that of a year
ago resulted from reduced  domestic  demand for all of our products and the loss
of business from our largest customer,  while the decrease in sales made outside
of the United  States was  primarily  the result of  decreased  sales to our two
largest customers.  Of the $5.7 million in net sales, $3.1 million, or 54%, were
attributable  to our  copier  finished  products,  while net sales of these same
products  were $4.3  million,  or 57%, for the  comparable  period in 2002.  The
revenue  decrease  from copier  products  from 2002 to 2003 was 30%,  reflecting
primarily the loss in business from our largest customer, while the decrease for
the comparable  period  experienced by laser products was 1%. Sales of our laser
finished  products  for the three  months  ended  March 31, 2003 were $1 million
compared  to $1 million for the same  period of 2002.  We believe  that sales of
both our copier and our laser  printing  products will increase  during 2003, as
the result of sales of new products recently introduced.

COST OF GOODS SOLD.  Cost of goods sold  decreased by $2.1  million,  or 33%, to
$4.3 million from $6.4 million for the three months ended March 31, 2003 and for
the  comparable  period in 2002,  primarily as the result of the decrease in net
sales. Cost of goods sold as a percentage of net sales decreased by 7 percentage
points from 84% for the three  months  ended March 31, 2002 to 77% for the three
months ended March 31, 2003,  primarily as the result of reduced  sales  derived
from certain very low margin products  previously  sold to our largest  customer
that have been  discontinued,  a larger  percentage  of sales being derived from
sales of products  with higher gross  margins and the effects of previous  price
increases on a few analog copier products. Having recently placed more efficient
manufacturing  equipment in service, we expect our cost of goods sold to further
decrease as a percentage of net sales.

GROSS PROFIT.  As a result of the above factors,  gross profit increased to $1.3
million in the three  months ended March 31, 2003 from $1.2 million in the three
months ended March 31, 2003, or approximately $100,000,  while net sales for the
same period  decreased by $2 million.  Gross profit as a percentage of net sales
increased  by 7  percentage  points from 16% to 23% for the three  months  ended
March 31, 2003, as compared to the corresponding period of the prior year.

OPERATING  EXPENSES.  Operating expenses increased $.25 million, or 30%, to $1.1
million in the three  months ended March 31, 2003 from $.85 million in the three
months  ended  March 31,  2002.  General  and  administrative,  selling  and R&D
expenses  increased,  as a percentage  of net sales,  to 20% in the three months
ended  March 31, 2003 from 11% in the three  months  ended March 31, 2002 as the
result of the decrease in net sales for the quarter.  General and administrative
expenses  increased  approximately  28%, or $.1 million to $.47  million for the
three months ended March 31, 2003 from the  comparable  period in 2002,  largely
resulting from increased legal and professional  fees and increased  payroll and
related  expenses.  Selling expenses  increased by $.09 million,  or 33%, in the
three months  ended March 31, 2003  compared to the three months ended March 31,
2002. Selling expenses increased  primarily as a result of increased  commission
and expense  reimbursements of our manufacturer's  representatives,  payroll and
advertising  and  promotional   expenses.   Research  and  development  expenses
increased  by $60,000,  or 29%, to $272,000 in the three  months ended March 31,
2003, primarily as the result of increased  expenditures for product formulation
testing and increased payroll and consulting expenses.  We expect to continue to
increase research and development expenditures in an effort to develop and bring
to market more new products  before our  competition,  while also  reformulating
certain product formulas to manufacture a greater  percentage of our products on
our more efficient production equipment.

OPERATING INCOME.  As a result of the above factors,  primarily the 30% increase
in operating  expenses,  operating  income  decreased by $156,000,  or 42%, to a
profit of $213,000 in the three months ended March 31, 2003 from $369,000 in the
three months ended March 31, 2002.

                                       13
<PAGE>

INTEREST AND FINANCE EXPENSE.  Interest expense increased by $1,000 in the three
months  ended March 31, 2003 from the three  months  ended March 31,  2002.  The
increase was primarily  the result of interest  expense on the  borrowings  from
related parties.

OTHER INCOME.  Other income increased by $41,000 from income of $7,000 to income
of $48,000 in the three  months ended March 31, 2003 from the three months ended
March 31, 2002,  primarily as the result of income  derived from the exchange of
Euros.

INCOME  TAXES.  As the result of our profit from  continuing  operations  in the
three  months  ended March 31,  2003,  we recorded  an income tax  provision  of
$74,000 for the period,  while the income tax  provisions  were $115,000 for the
three months ended March 31, 2002.

RESULTS OF DISCONTINUED OPERATIONS

The following table sets forth, for the periods indicated,  selected information
relating to the  discontinued  operations of Logical Imaging  Solutions that has
been derived from our unaudited consolidated statements of operations.

                                                Three Months Ended
                                                      March 31,
                                       ------------------   -------------------
                                                  2003                 2002
                                       ------------------   -------------------
     Net sales                                $       --            $  197,755
     Operating (loss)                                 --              ( 99,784)
     Net (loss)                               $       --            $ ( 70,258)


LIQUIDITY AND CAPITAL RESOURCES

At March 31, 2003, and December 31, 2002, our working  capital and current ratio
was  approximately  $6.9  million and $1.8  million and 2.78 to 1 and 1.29 to 1,
respectively.  The substantial increase in our working capital and current ratio
at March 31, 2003,  compared to December 31, 2002,  was primarily due to the net
proceeds we received from the public sale of our common stock.

Cash flows used by continuing  operating  activities  were $113,000 in the three
months  ended  March 31,  2003  compared  to  $174,660  provided  by  continuing
operations  in the three  months  ended March 31,  2002.  The cash flows used by
continuing  operating  activities  in the three  months  ended  March  31,  2003
increased primarily due to the reduction made to accounts payable.

Cash flows used in investing  activities  were $58,000 in the three months ended
March 31,  2003,  compared to $248,000 in the three months ended March 31, 2002.
The  decrease in cash used in  investing  activities  in the three  months ended
March 31, 2002, was entirely  attributable to decreased capital  expenditures in
connection with our most recent factory expansion.

We have a $1.5 million revolving line of credit, as amended,  with our bank that
had an outstanding balance as of March 31, 2003 of $0. At the end of each month,
for the following month, we have an interest rate option of either the one-month
Libor  interest  rate in effect two  business  days  before the first day of the
month plus 2.50% or our bank's prime interest rate minus 0.25%.  As of March 31,
2003,  the  interest  rate was the  one-month  Libor rate of 1.3375%  plus 2.50%
(3.8375%).  This revolving line of credit has a June 30, 2003  expiration  date.
Under the line of  credit,  we are  permitted  to  borrow up to 85% of  eligible
accounts  receivable and 50 percent of eligible  inventories (up to a maximum of
$1.1  million  and not to exceed 60 percent of the total  outstanding).  We have
granted our bank a security  interest  in all of our assets as security  for the
repayment of the lines of credit.

The Bank agreement  contains various  covenants which the Company is required to
maintain,  and as of March 31, 2003,  the Company was in  compliance  with these
covenant requirements.

Cash  flows  provided  by  financing  activities,  after the  repayment  of some
$1,330,000 of debt and $1,022,000  reduction to the line of credit for the three
months  ended  March 31,  2003 were  $3,252,000,  resulting  primarily  from the
$5,917,000  in net proceeds  received for the public sale of our common stock to
an affiliate.  Cash flows  provided by financing  activities  for the same three
month  period  ended March 31,  2002,  were  $530,000,  derived  primarily  from
$500,000 in proceeds from related party borrowings.

                                       14
<PAGE>

On April 18, 2003, Color Imaging  established a stock  repurchase  program under
which Color  Imaging's  common stock,  with an aggregate  market value up to the
lesser of $1 million or 1 million shares,  may be acquired in the open market or
through private or other  transactions.  As of April 30, 2003, Color Imaging has
not repurchased any of our common stock.

We believe that existing cash balances,  cash generated by operating activities,
and funds  available under our credit facility will be sufficient to finance our
operating and investing  activities for at least the next 12 months,  which will
include  expenditures of approximately  $500,000 for  manufacturing and research
and development  equipment,  approximately $100,000 for a significant upgrade to
our accounting and manufacturing computer system and the repurchase of our stock
under  the  stock  repurchase  program  of up to the  lesser  of  $1,000,000  or
1,000,000 shares of our common stock.

FACTORS   THAT  MAY   AFFECT   FUTURE   RESULTS   AND   INFORMATION   CONCERNING
FORWARD-LOOKING STATEMENTS

RISK FACTORS

RISKS RELATED TO OUR BUSINESS:

OUR BUSINESS DEPENDS ON A LIMITED NUMBER OF CUSTOMERS.

For the  three  months  ended  March  31,  2003,  two  customers  accounted  for
approximately  52%  of our  net  sales.  We do not  have  contracts  with  these
customers and all of the sales to them are made through purchase  orders.  While
our products typically go through the customer's required qualification process,
which we  believe  gives us an  advantage  over other  suppliers,  this does not
guarantee  that the  customer  will  continue to  purchase  from us. The loss of
either of these  customers,  including  through an  acquisition,  other business
combination  or the loss by them of business from their  customers  could have a
substantial and adverse effect on our business.  We have in the past, and may in
the future,  lose one or more major  customers  or  substantial  portions of our
business with one or more of our major customers.  If we do not sell products or
services to  customers in the  quantities  anticipated,  or if a major  customer
reduces  or  terminates  its  relationship  with us,  market  perception  of our
products and technology,  growth prospects,  and financial condition and results
of operation could be harmed.

OUR  RELIANCE ON SALES TO A FEW MAJOR  CUSTOMERS  AND  GRANTING  CREDIT TO THOSE
CUSTOMERS PLACES US AT FINANCIAL RISK.

As of March 31, 2003,  receivables from two customers  comprised 52% of accounts
receivable.  A concentration of our receivables from a small number of customers
places us at risk should these receivables become  uncollectable.  If any one or
more of our major  customers is unable to pay us it could  adversely  affect our
results of operations and financial condition.  Color Imaging attempts to manage
this credit risk by performing  credit  checks,  requiring  significant  partial
payments  prior  to  shipment  where   appropriate,   and  actively   monitoring
collections.

APPROXIMATELY  33% OF OUR BUSINESS DEPENDS ON A SUPPLIER  APPROVED BY ONE OF OUR
CUSTOMERS.

Some  of  our  products  incorporate  technologies  that  are  available  from a
particular   supplier  that  has  been   approved  by  one  of  our   customers.
Approximately  33% of our sales for the three months ended March 31, 2003,  were
derived from products limited to a specific supplier. For the three months ended
March 31, 2003, we purchased 41% of our supplies from that same supplier.  We do
not  have a  written  agreement  with  this or any  other  supplier.  We rely on
purchase orders. Should we be unable to obtain the necessary materials from this
supplier, product shipments could be prevented or delayed, which could result in
a loss of sales.  If we are  unable to  fulfill  existing  orders or accept  new
orders because of a shortage of materials,  we may lose revenues and risk losing
customers.

IF OUR CRITICAL SUPPLIERS FAIL TO DELIVER SUFFICIENT  QUANTITIES OF MATERIALS OR
PRODUCTS IN A TIMELY AND  COST-EFFECTIVE  MANNER IT COULD NEGATIVELY  AFFECT OUR
BUSINESS.

We use a wide range of materials in the  production of our products,  and we use
numerous  suppliers  to supply  materials  and  certain  finished  products.  We
generally do not have guaranteed supply arrangements with our suppliers. Because
of the  variability and uniqueness of customers'  orders,  we do not maintain an


                                       15
<PAGE>

extensive  inventory of materials  for  manufacturing  or resale.  Key suppliers
include  providers of special resins,  toners and our injection molder affiliate
that provides plastic  bottles,  cartridges and related  components  designed to
avoid the intellectual property rights of others.

Although we make  reasonable  efforts to ensure that raw  materials,  toners and
certain  finished  products are available from multiple  suppliers,  this is not
always possible;  accordingly, some of these materials are being procured from a
single  supplier or a limited  group of suppliers.  Many of these  suppliers are
outside the United  States,  resulting in longer  lead-times  for many important
materials,  which could cause delays in meeting  shipments to our customers.  We
have  sought,  and will  continue to seek,  to minimize  the risk of  production
interruptions and shortages of key materials and products by:

     o    selecting and qualifying  alternative  suppliers for key materials and
          products;
     o    monitoring the financial stability of key suppliers; and
     o    maintaining appropriate inventories of key materials and products.

There can be no assurance that results of operations  will not be materially and
adversely  affected  if,  in the  future,  we do not  receive  in a  timely  and
cost-effective manner a sufficient quantity of raw materials, toners or finished
products to meet our production or customer delivery requirements.

OUR  SUCCESS IS  DEPENDENT  ON OUR  ABILITY TO UTILIZE  AVAILABLE  MANUFACTURING
CAPACITY.

From 1999 through 2000, we expanded our manufacturing  capacity by acquiring new
manufacturing  equipment and moving to a larger location.  We intend to continue
to expand  capacity  by placing in service  additional  manufacturing  equipment
during  2003.  To  fully  utilize  these  new  additions  to  the  factory,  new
formulations for toner have to be developed specifically for manufacture on this
new  equipment  or orders for  larger  quantities  of  existing  toners  must be
obtained. While we have been successful in developing formulas for new equipment
in the past and  increasing  sales of many of our existing toner  products,  our
continued  success  will be  dependent  on our  ability  to  develop  additional
formulations  or increase our sales from existing  formulations  and manufacture
the toners with the new equipment to achieve a reduction in production costs. We
cannot  assure  you  that  we  will  be  successful  in  developing  all  of the
formulations  needed in the future or that we will be able to manufacture  toner
at a lower production cost on a regular basis or that such products will achieve
market  acceptance.  If we are not  successful  in  increasing  the sales of our
manufactured  products,  or if our  existing  sales from  manufactured  products
decline, our business will be materially and adversely affected.

OUR SUCCESS IS DEPENDENT ON OUR ABILITY TO SUCCESSFULLY DEVELOP, OR ACQUIRE FROM
THIRD PARTIES,  INTELLECTUAL  PROPERTY OR PRODUCTS THAT WE CAN COMMERCIALIZE AND
THAT ACHIEVE MARKET ACCEPTANCE.

Our success depends in part on our ability to develop proprietary toner formulas
and manufacturing  processes,  obtain copyrights and trademarks,  maintain trade
secret  protection  and operate  without  infringing the  proprietary  rights of
others.  Future claims of intellectual  property  infringement  could prevent us
from obtaining  technology of others and could  otherwise  adversely  affect our
operating results, cash flows, financial position or business, as could expenses
incurred  enforcing  intellectual  property  rights  against others or defending
against claims that our products  infringe the  intellectual  property rights of
others.

Success in the  aftermarket  imaging  industry  depends,  in part, on developing
consumable  products that are  compatible  with the printers,  photocopiers  and
facsimile  machines  made by the OEMs,  and that have a selling  price less than
that of like consumable  supplies  offered by the OEM. For example,  if the OEMs
introduce chemical toners with better imaging characteristics and higher yields,
microprocessor  chips  that  communicate  between  the toner  cartridge  and the
device, or introduce products using patented or other proprietary  technologies,
then the aftermarket  industry has to respond with ongoing development  programs
to offer compatible  products that emulate the OEMs' without infringing upon the
OEM's intellectual property.

Technical innovations are inherently complex and require long development cycles
and appropriate  professional  staffing.  Our future business success depends on
our  ability,  and that of  critical  suppliers,  to develop and  introduce  new
products that successfully  address the changing  technologies of the OEMs, meet
the customer's  needs and win market  acceptance in a timely and  cost-effective
manner.  If we do not develop and introduce  products  compatible with the OEM's
technologies  in a timely  manner in response to changing  market  conditions or
customer requirements, our business could be seriously harmed.

                                       16
<PAGE>

The challenges we face in implementing  our business model include  establishing
market acceptance of existing products and successfully  developing or acquiring
new  product  lines  that  achieve  market  acceptance.   We  must  successfully
commercialize the products that are currently being developed, such as our color
and magnetic  character  recognition toner for printers and black text and color
toners for new digital copiers and continue to acquire from third parties parts,
materials and finished product that can be integrated into finished  products or
sold as our products.  While we have  successfully  developed toners in the past
and are in the late stages of developing and testing several new toners, we have
not commercialized many of the toners that are under development.  While we have
in the past acquired from third parties materials and products that we have been
successful  in  selling,  there can be no  assurance  that parts,  materials  or
products for new products will be available or will achieve  market  acceptance.
If we fail to  successfully  commercialize  products we develop or acquire  from
third  parties,  or if these  products fail to achieve  market  acceptance,  our
financial condition and results of operation would be seriously harmed.

OUR BUSINESS MIGHT BE ADVERSELY AFFECTED BY OUR DEPENDENCE ON FOREIGN BUSINESS.

We sell a  significant  amount of  product  to  customers  outside of the United
States. International sales accounted for 41%, 37%, 24% and 10% of net sales for
the three months ended March 31, 2003, and in the years ended December 31, 2002,
2001 and 2000, respectively. We expect that shipments to international customers
will continue to account for a material  portion of net sales.  During the three
months ended March 31, 2003, our sales were made to customers outside the United
States as follows:

     o    Europe (including Israel and Africa) - 20%
     o    Mexico - 12%
     o    Asia - 4%
     o    Other - 5%

Most of our products sold  internationally,  including  those sold to our larger
international  customers, are on open account, giving rise to the added costs of
collection  in the  event of  non-payment.  Further,  should a  product  shipped
overseas be defective, Color Imaging would experience higher costs in connection
with a product recall or return and replacement.

Most of our products are priced in U.S.  dollars,  but because we began  selling
products in Europe  denominated in Euros during 2001,  fluctuations  in the Euro
could  also  cause  our  products  there  to  become  less  affordable  or  less
competitive  or we may  sell  some  products  at a loss  to  otherwise  maintain
profitable business from a customer. We recorded a gain of $37,209 for the three
months ended March 31, 2003. We recorded a gain of $2,858 and a charge of $1,877
during the years ended December 31, 2002 and 2001, respectively,  as a result of
foreign currency transactions.

While our  business  has not been  materially  affected  in the past by  foreign
business or currency  fluctuations,  because of our  significant  dependence  on
international  revenues, our operating results could be negatively affected by a
continued or  additional  decline in the  economies  of any of the  countries or
regions  in which we do  business.  Periodic  local  or  international  economic
downturns,  trade balance issues,  changes to duties,  tariffs or  environmental
regulations,  political  instability  and  fluctuations in interest and currency
exchange rates could negatively affect our business and results of operations.

We cannot assure you that these factors will not have a material  adverse effect
on our international sales and would, as a result,  adversely impact our results
of operation and financial condition.

OUR RESULTS OF OPERATIONS  MAY BE  MATERIALLY  HARMED IF WE ARE UNABLE TO RECOUP
OUR INVESTMENT IN RESEARCH AND DEVELOPMENT.

The rapid change in technology in our industry requires that we continue to make
investments   in  research  and   development  in  order  to  not  only  develop
technologies  that  function  like the  OEMs' and do not  infringe  on the OEMs'
intellectual  property  rights,  but we must also  enhance the  performance  and
functionality  of our  products and to keep pace with  competitive  products and
satisfy customer demands for improved performance,  features,  functionality and
costs.  There can be no assurance that revenues from future  products or product
enhancements will be sufficient to recover the development costs associated with


                                       17
<PAGE>

such  products or  enhancements  or that we will be able to secure the financial
resources necessary to fund future  development.  Research and development costs
typically  are  incurred  before  we  confirm  the  technical   feasibility  and
commercial viability of a product, and not all development  activities result in
commercially viable products.  In addition, we cannot ensure that these products
or enhancements  will receive market  acceptance or that we will be able to sell
these  products  at prices  that are  favorable  to us.  Our  business  could be
seriously harmed if we are unable to sell our products at favorable prices or if
our products are not accepted by the market in which we operate.

OUR INTELLECTUAL PROPERTY PROTECTION IS LIMITED.

We do not rely on patents to protect  our  proprietary  rights.  We do rely on a
combination of laws such as trade secrets and contractual  restrictions  such as
confidentiality   agreements  to  protect   proprietary   rights.   Despite  any
precautions we have taken:

o    laws and  contractual  restrictions  might  not be  sufficient  to  prevent
     misappropriation  of our technology or deter others from developing similar
     technologies; and
o    policing  unauthorized  use of our  products is  difficult,  expensive  and
     time-consuming  and we might not be able to  determine  the  extent of this
     unauthorized use.

Therefore, there can be no assurance that we can meaningfully protect our rights
in such unpatented  proprietary technology or that others will not independently
develop substantially  equivalent proprietary products or processes or otherwise
gain access to the proprietary  technology.  Reverse  engineering,  unauthorized
copying or other  misappropriation  of our proprietary  technology  could enable
third  parties to benefit  from our  technology  without  paying us which  could
significantly harm our business.

WE DEPEND ON THE EFFORTS AND ABILITIES OF CERTAIN  SENIOR  MANAGEMENT  AND OTHER
KEY PERSONNEL TO CONTINUE OUR OPERATIONS AND GENERATE REVENUES.

Our success depends to a significant  extent on the continued services of senior
management and other key personnel. While we do have employment, non-compete and
confidentiality  agreements  with  executive  officers  and  certain  other  key
individuals, employment agreements may be terminated by either party upon giving
the required notice.  The loss of the services of any of our executive  officers
or other key employees could harm our business.  Our success also depends on our
ability to attract,  retain and motivate highly skilled  employees.  Competition
for qualified  employees in the industries in which we operate is intense. If we
fail to hire and retain a sufficient number of qualified employees, our business
will be adversely affected.

WE HAVE A SINGLE MANUFACTURING FACILITY AND WE MAY LOSE REVENUE AND BE UNABLE TO
MAINTAIN OUR CLIENT RELATIONSHIPS IF WE LOSE OUR PRODUCTION CAPACITY.

We manufacture all of the products we sell in our existing facility in Norcross,
Georgia.  If our existing production facility becomes incapable of manufacturing
products for any reason,  we may be unable to meet production  requirements,  we
may lose revenue and we may not be able to maintain our  relationships  with our
customers.  Without our  existing  production  facility,  we would have no other
means of manufacturing  products until we were able to restore the manufacturing
capability  at our facility or develop an  alternative  manufacturing  facility.
Although we carry  business  interruption  insurance  to cover lost  revenue and
profits in an amount we consider  adequate,  this  insurance  does not cover all
possible situations.  In addition, our business interruption insurance would not
compensate  us for the loss of  opportunity  and  potential  adverse  impact  on
relations  with our existing  customers  resulting from our inability to produce
products for them.

OUR ACQUISITION STRATEGY MAY PROVE UNSUCCESSFUL.

We intend to pursue  acquisitions of businesses or technologies  that management
believes  complement or expand the existing business.  Acquisitions of this type
involve a number of risks,  including the possibility that the operations of any
businesses that are acquired will be  unprofitable or that management  attention
will be diverted  from the  day-to-day  operation of the existing  business.  An
unsuccessful  acquisition  could reduce  profit  margins or  otherwise  harm our
financial   condition,   by,  for  example,   impairing  liquidity  and  causing
non-compliance with lending institution's  financial covenants. In addition, any
acquisition  could  result in a  dilutive  issuance  of equity  securities,  the
incurrence  of  debt or the  loss  of key  employees.  Certain  benefits  of any
acquisition may depend on the taking of one-time or recurring accounting charges
that may be material. We cannot predict whether any acquisition undertaken by us
will be successfully  completed or, if one or more  acquisitions  are completed,
whether the  acquired  assets  will  generate  sufficient  revenue to offset the
associated costs or other adverse effects.

                                       18
<PAGE>

COMPLIANCE  WITH  GOVERNMENT  REGULATIONS  MAY  CAUSE  US  TO  INCUR  UNFORESEEN
EXPENSES.

Our black text,  color and magnetic  character toner supplies and  manufacturing
operations  are  subject to domestic  and  international  laws and  regulations,
particularly  relating to environmental  matters that impose  limitations on the
discharge of pollutants into the air, water and soil and establish standards for
treatment,  storage and disposal of solid and hazardous wastes. In addition,  we
are subject to regulations  for storm water  discharge,  and as a requirement of
the State of Georgia have  developed  and  implemented  a Storm Water  Pollution
Prevention  Plan.  We are also  required to have a permit issued by the State of
Georgia in order to conduct  various  aspects of our business.  Compliance  with
these laws and regulations has not in the past had a material  adverse affect on
our capital  expenditures,  earnings or  competitive  position.  There can be no
assurance, however, that future changes in environmental laws or regulations, or
in the criteria required to obtain or maintain necessary permits,  will not have
a material adverse affect on our operations.

OUR QUARTERLY OPERATING RESULTS FLUCTUATE AS A RESULT OF MANY FACTORS.

Our quarterly operating results fluctuate due to various factors.  Some of these
factors  include the mix of products sold during the quarter,  the  availability
and costs of raw materials or components,  the costs and benefits of new product
introductions, and customer order and shipment timing. Because of these factors,
our quarterly  operating results are difficult to predict and are likely to vary
in the future.

RISKS RELATING TO OUR INDUSTRY:

WE OPERATE IN A COMPETITIVE AND RAPIDLY CHANGING MARKETPLACE.

There is significant  competition in the toner and consumable  imaging  products
industry in which we operate. In addition, the market for digital color printers
and copiers and related  consumable  products is subject to rapid change and the
OEM technologies are becoming  increasingly  difficult barriers to market entry.
Many competitors,  both OEMs and other after market firms, have longer operating
histories,  larger customer bases,  greater brand  recognition and significantly
greater  financial,  marketing and other resources than we do. These competitors
may be able to devote  substantially more resources to developing their business
than we can. Our ability to compete depends upon a number of factors,  including
the  success and timing of product  introductions,  marketing  and  distribution
capabilities and the quality of our customer support.  Some of these factors are
beyond our control.  In addition,  competitive  pressure to develop new products
and technologies could cause our operating expenses to increase substantially.

THE IMAGING SUPPLIES INDUSTRY IS COMPETITIVE AND WE ARE RELATIVELY SMALL IN SIZE
AND HAVE FEWER RESOURCES IN COMPARISON WITH MANY OF OUR COMPETITORS.

Our industry  includes large original  equipment  manufacturers  of printing and
photocopying  equipment  and the  related  imaging  supplies,  as well as  other
manufacturers and resellers of aftermarket  imaging  supplies,  with substantial
resources to support customers  worldwide.  Our future performance  depends,  in
part, upon our ability to continue to compete successfully worldwide. All of the
original  equipment   manufacturers  and  many  of  our  other  competitors  are
diversified  companies  with  greater  financial  resources  and more  extensive
research, engineering, manufacturing, marketing and customer service and support


                                       19
<PAGE>

capabilities  than we can provide.  We face  competition  from  companies  whose
strategy is to provide a broad array of products, some of which compete with the
products that we offer.  These competitors may bundle their products in a manner
that may discourage customers from purchasing our products. In addition, we face
competition  from smaller emerging imaging supply companies whose strategy is to
provide  a  portion  of the  products  and  services  that  we  offer.  Loss  of
competitive position could impair our prices, customer orders,  revenues,  gross
margins,  and market share, any of which would  negatively  affect our operating
results and financial condition.  Our failure to compete successfully with these
other companies  would  seriously harm our business.  There is risk that larger,
better-financed  competitors will develop and market more advanced products than
those that we currently offer or may be able to offer, or that  competitors with
greater  financial  resources  may  decrease  prices  thereby  putting  us under
financial pressure.  The occurrence of any of these events could have a negative
impact on our revenues.

OUR  PRODUCTS  HAVE  SHORT  LIFE  CYCLES  AND  ARE  SUBJECT  TO  FREQUENT  PRICE
REDUCTIONS.

The  markets in which we operate  are  characterized  by  rapidly  evolving  and
increasingly  difficult  technologies,  frequent new product  introductions  and
significant  price  competition.  Consequently,  our  products  have  short life
cycles, and we must frequently reduce prices in response to product competition.
Our financial condition and results of operations could be adversely affected if
we are unable to manufacture  new and  competitive  products in a timely manner.
Our success  depends on our ability to develop and  manufacture  technologically
advanced  products,  price them  competitively,  and achieve cost reductions for
existing  products.   Technological  advances  require  sustained  research  and
development efforts,  which may be costly and could cause our operating expenses
to increase substantially.

OUR  FINANCIAL  PERFORMANCE  DEPENDS  ON  OUR  ABILITY  TO  SUCCESSFULLY  MANAGE
INVENTORY LEVELS, WHICH IS AFFECTED BY FACTORS BEYOND OUR CONTROL.

Our  financial  performance  depends in part on our ability to manage  inventory
levels to  support  the needs of new and  existing  customers.  Our  ability  to
maintain  appropriate  inventory  levels  depends on factors beyond our control,
including  unforeseen  increases  or  decreases  in demand for our  products and
production and supply  difficulties.  Demand for our products can be affected by
product  introductions  or price changes by competitors or by us, the life cycle
of our products,  or delays in the development or manufacturing of our products.
Our  operating  results and ability to increase the market share of our products
may be  adversely  affected  if we are unable to address  inventory  issues on a
timely basis.

RISKS RELATING TO OWNING OUR COMMON STOCK:

OUR OFFICERS AND DIRECTORS BENEFICIALLY OWN APPROXIMATELY 42% OF THE OUTSTANDING
SHARES OF COMMON STOCK, ALLOWING THESE STOCKHOLDERS TO CONTROL MATTERS REQUIRING
APPROVAL OF THE STOCKHOLDERS.

As a result of such  ownership by our officers and  directors,  other  investors
will have limited control over matters  requiring  approval by the stockholders,
including the election of directors.  Such concentrated control may also make it
difficult  for the  stockholders  to receive a premium  for their  shares of our
common stock in the event we enter into  transactions  that require  stockholder
approval. In addition,  certain provisions of Delaware law could have the effect
of making it more difficult or more  expensive for a third party to acquire,  or
of discouraging a third party from attempting to acquire control of us.

EXERCISE OF WARRANTS AND OPTIONS  WILL DILUTE  EXISTING  STOCKHOLDERS  AND COULD
DECREASE THE MARKET PRICE OF OUR COMMON STOCK.

As of April 21, 2003, we had issued and outstanding  12,908,333 shares of common
stock and  901,993  outstanding  warrants  and  920,000  outstanding  options to
purchase  additional  shares of common stock,  exclusive of 16,672 shares of our
common  stock and  warrants to purchase  33,344  shares of our common stock that
have been repurchased  pursuant to a repurchase  agreement and will be cancelled
upon their  receipt from escrow.  The  existence of the  remaining  warrants and
options may adversely  affect the market price of our common stock and the terms
under which we obtain additional equity capital.



                                       20
<PAGE>

WE MAY FACE POTENTIAL REGULATORY ACTION OR LIABILITY IN CONNECTION WITH OUR 2001
PRIVATE PLACEMENT.

Our  issuance  of common  stock and  warrants in a private  placement  which was
completed in 2001 could subject us to potential adverse consequences,  including
securities law liability and the voiding of contracts entered into in connection
with the private placement. If our activities or the activities of other parties
in the 2001 private placement are deemed to be inconsistent with securities laws
under Section 29 of the Securities Exchange Act of 1934 or our activities or the
activities or the activities of other parties are deemed to be inconsistent with
the broker dealer registration provisions of Section 15(a) of the Exchange Act:

     o    we may be able to void our obligation to pay transaction-related  fees
          in  connection   with  the  private   placement  and  we  may  receive
          reimbursement for fees already paid;
     o    persons with whom we have entered into  securities  transactions  that
          are  subject to these  transaction-related  fees may have the right to
          void these transactions; and
     o    we may be subject to regulatory action.

Due to the inherent uncertainties involved with the interpretation of securities
laws,  we are unable to predict the  following:  the  validity of any  potential
liability  in  connection  with  our  private  placement,  the  outcome  of  any
regulatory action or potential liability or the outcome of voiding  transactions
in connection with the private  placement.  The defense of any regulatory action
or litigation and any adverse  outcome could be costly and could have a material
adverse  effect on our financial  position and results of  operations  and could
divert management attention.

DIGITAL  COLOR  PRINT'S  TENDER  OFFER TO EXCHANGE  ITS SHARES FOR UP TO 900,000
SHARES OF OUR COMMON STOCK MAY  ADVERSELY  AFFECT THE MARKET PRICE OF OUR COMMON
STOCK.

Digital Color Print's  tender offer to exchange  shares for up to 900,000 shares
of our common  stock could  result in Digital  Color Print  having up to 900,000
shares of our common stock that it could sell in the market.  The sale of all or
substantially  all of such shares of our common stock by Digital Color Print may
adversely affect the market price of our common stock.

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

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

OUR STOCK  PRICE MAY BE VOLATILE  AND AN  INVESTMENT  IN OUR COMMON  STOCK COULD
SUFFER A DECLINE IN VALUE.

The market price of our common stock may fluctuate  significantly in response to
a number of  factors,  some of which  are  beyond  our  control.  These  factors
include, but are not limited to:

     o    progress of our products through development and marketing;

     o    announcements  of  technological  innovations or new products by us or
          our competitors;

     o    government  regulatory  action  affecting our products or competitors'
          products in both the United States and foreign countries;

     o    developments or disputes concerning patent or proprietary rights;

     o    actual or anticipated fluctuations in our operating results;

     o    the loss of key management or technical personnel;

     o    the loss of major customers or suppliers;

                                       21
<PAGE>

     o    the outcome of any future litigation;

     o    changes in our financial estimates by securities analysts;

     o    fluctuations in currency exchange rates;

     o    general  market   conditions   for  emerging   growth  and  technology
          companies;

     o    broad market fluctuations;

     o    recovery from natural disasters; and

     o    economic conditions in the United States or abroad.

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

Our certificate of incorporation makes it possible for our board of directors to
issue  preferred stock with voting or other rights that could impede the success
of any attempt to change  control of us. Our  certificate of  incorporation  and
bylaws  eliminate  cumulative  voting  which  may make it more  difficult  for a
minority  stockholder  to gain a seat on our board of directors and to influence
board of  directors'  decision  regarding a takeover.  Delaware Law  prohibits a
publicly  held   Delaware   corporation   from  engaging  in  certain   business
combinations with certain persons, who acquire our securities with the intent of
engaging in a business combination,  unless the proposed transaction is approved
in  a  prescribed  manner.   This  provision  has  the  effect  of  discouraging
transactions  not  approved by our board of directors as required by the statute
which may discourage  third parties from  attempting to acquire us or to acquire
control of us even if the attempt  would  result in a premium  over market price
for the shares of common stock held by our stockholders.

The  information  referred  to above  should be  considered  by  investors  when
reviewing any forward-looking statements contained in this report, in any of our
public filings or press releases or in any oral  statements made by us or any of
our officers or other persons acting on our behalf.  The important  factors that
could affect  forward-looking  statements are subject to change, and we disclaim
any obligation or duty to update or modify these forward-looking statements.

FORWARD-LOOKING STATEMENTS

Statements  contained in this report which are not statements of historical fact
are  forward-looking  statements  within  the  meaning  of  Section  27A  of the
Securities Act of 1933 and Section 21E of the  Securities  Exchange Act of 1934.
These forward-looking statements may be identified by the use of forward-looking
terms such as "believes," "expects," "may", "will," "should" or "anticipates" or
by  discussions of strategy that involve risks and  uncertainties.  From time to
time, we have made or may make forward-looking statements, orally or in writing.
These  forward-looking  statements include  statements  regarding our ability to
borrow funds from financial  institutions  or affiliates,  to engage in sales of
our securities,  our intention to repay certain  borrowings from future sales of
our  securities  or cash  flow,  the  ability to expand  capacity  by placing in
service additional manufacturing equipment during 2003, our expected acquisition
of business or  technologies,  our expectation  that shipments to  international
customers  will  continue  to  account  for a  material  portion  of net  sales,
anticipated future revenues, our introduction of new products and our increasing
our sales from digital copier,  color and magnetic  character  recognition toner
products during 2003, the prospective effects of having discontinued the Logical
Imaging Solutions operations, sales, operations,  demand, technology,  products,
business ventures, major customers, major suppliers,  retention of key officers,
management or employees,  competition, capital expenditures, credit arrangements
and other statements  regarding matters that are not historical  facts,  involve
predictions  which are based upon a number of future  conditions that ultimately
may prove to be inaccurate.  Our actual  results,  performance  or  achievements
could  differ  materially  from the results  expressed  in, or implied by, these
forward-looking  statements.  Forward-looking  statements  are made  based  upon
management's current expectations and beliefs concerning future developments and
their  potential  effects upon our business.  We cannot  predict  whether future
developments affecting us will be those anticipated by management, and there are
a number of factors that could adversely affect our future operating  results or
cause our actual results to differ materially from the estimates or expectations
reflected in such forward-looking statements.



                                       22
<PAGE>

ITEM 3. Quantitative and Qualitative Disclosures about Market Risks

Market risk is the risk of loss to future earnings,  to fair values or to future
cash flows that may result from changes in the price of a financial  instrument.
The  value of a  financial  instrument  may  change as a result  of  changes  in
interest rates, exchange rates, commodity prices, equity prices and other market
changes.   Market  risk  is  attributed  to  all  market   sensitive   financial
instruments, including long-term debt.

We do not hold any investments or assets outside of the United States.  However,
we are exposed to financial market risks,  including changes in foreign currency
exchange rates and interest rates.

We estimate that about 80% of our transactions are denominated in U.S.  dollars,
excepting  those sales in Euros to our second largest  customer's  operations in
Europe. Accordingly,  beginning in 2001, we are subject to foreign currency risk
with  respect to future  costs or cash  flows  from our sales in Euros.  We have
adjusted  our prices  annually  with our  customer  to reflect the change in the
exchange rate and do not expect to be subject to material foreign currency risk,
accordingly,  with respect to those  sales.  As a result,  to date,  we have not
entered into any foreign currency forward exchange contracts or other derivative
financial  instruments to hedge the effects of adverse  fluctuations  in foreign
currency  exchange.  We  incurred a net  foreign  currency  transaction  gain of
$37,209 in the  quarter  ended  March 31,  2003,  and we  incurred a net foreign
currency  transaction  gain of $2,858  and a loss of  $1,877 in the years  ended
December 31, 2002 and 2001,  respectively.  Our pricing for our products sold in
Euros is currently at the rate of 0.96 Euros relative to the U.S.  dollar. A 10%
change in the value of the Euro from .96 Euros  relative  to the  United  States
dollar  would  cause  approximately  an  $8,000  foreign  currency   translation
adjustment in an average  month,  a type of other  comprehensive  income (loss),
which would be a direct adjustment to stockholders' equity.

Our revolving  line of credit bears interest based on interest rates tied to the
prime  rate or LIBOR  rate,  either of which may  fluctuate  over time  based on
economic  conditions.  As a result, we are subject to market risk for changes in
interest  rates  and could be  subjected  to  increased  or  decreased  interest
payments if market rates  fluctuate and we are in a borrowing mode. At March 31,
2003, there were no amounts  outstanding under the line of credit agreement and,
accordingly,  a sustained  increase in the reference  rate of 1% would not cause
our annual interest expense to change.

Color Imaging's  investment policy requires investments with high credit quality
issuers and or over night repurchase agreements with our bank.  Investments made
by Color Imaging will  principally  consist of U.S.  government  and  government
agency  obligations  and  investment-grade,   interest-bearing   corporate  debt
securities  with varying  maturity dates of five years or less, or the overnight
purchase of securities held in our bank's investment  portfolio.  Because of the
credit criteria of the Color Imaging's investment  policies,  the primary market
risk associated with these investments is interest rate risk. Color Imaging does
not use  derivative  financial  instruments  to manage  interest rate risk or to
speculate on future changes in interest rates.  Since Color Imaging did not have
any monies  invested in  securities at March 31, 2003, we are not subject to any
market or interest rate risk in connection with securities available-for-sale.

Management believes that a reasonable change in raw material prices could have a
material impact on future  earnings or cash flows,  because we generally are not
able to offset increases to our costs with higher prices for our products.

ITEM 4. Controls and Procedures

     a) On April 25, 2003,  our President and  principal  executive  officer and
Chief  Financial  Officer  participated  in a meeting  during which there was an
evaluation of our disclosure controls and procedures.  Based on such evaluation,
they believe such controls and procedures are effective.

     b) Our  President  and  principal  executive  officer  and Chief  Financial
Officer are involved in ongoing  evaluations of internal controls.  On April 25,
2003,  in  anticipation  of the  filing of this Form  10-Q,  they  reviewed  our
internal  controls and have  determined,  based on such review,  that, since the
date of their  review,  there have been no  significant  changes in our internal
controls  or in other  factors  that would  significantly  affect  our  internal
controls subsequent to such evaluation.



                                       23
<PAGE>

PART II

ITEM 1. Legal Proceedings

None.

ITEM 2. Changes in Securities

On  January  23,  2003,  the  Company's  registration  statement  on Form  SB-2,
registering up to 7 million shares of the Company's  common stock,  was declared
effective (Registration Statement No. 333-76090), and the offering was commenced
by the  Company's  officers  and  directors.  On March  13,  2003,  the  Company
completed the public sale of 4,500,000 shares of the Company's common stock at a
price of $1.35 per share,  whereby  the  Company  received  $6,075,000  in gross
proceeds from an affiliate,  and the Company  terminated the offering before the
sale of all 7 million  of  registered  shares.  From the  effective  date of the
Company's  registration  statement  through March 31, 2003, the Company incurred
total expenses for professional  fees and printing of $30,129 in connection with
the issuance and  distribution of the Company's  common stock.  The net proceeds
received by the Company, after expenses of $30,129, was $6,044,871.  None of the
aforementioned expenses were direct or indirect payments to directors, officers,
their  associates or persons owning ten (10) percent or more of the common stock
of the Company.



                                       24
<PAGE>


Our intended uses of the $6,075,000 of proceeds received from the public sale of
our common  stock,  and our uses  through  March 31,  2003,  are listed below in
descending order of priority:

<TABLE>
<CAPTION>
<S>                                                               <C>            <C>            <C>             <C>
Purpose:                                                            Amount          Used        Reallocated     Remaining
-------------------                                               ----------     ----------     -----------     ----------
Accounts payable and other corporate
 and offering expenses. . . . . . . . . . . . . . .               $1,000,000     $  413,816     $         0     $  586,184
To retire debt (1). . . . . . . . . . . . . . . . .               $  350,000     $  324,301     $    25,699     $        0
To retire debt (2). . . . . . . . . . . . . . . . .               $1,050,000     $  956,883     $    93,113     $        0
To acquire capital assets . . . . . . . . . . . . .               $1,500,000     $   20,000     $         0     $1,480,000
For other general corporate purposes
 including working capital. . . . . . . . . . . . .               $2,175,000     $        0     $   118,812     $2,293,812
                                                                  ----------     ----------                     ----------
                                                          Total:  $6,075,000     $1,715,000                     $4,360,000
Pending application:
-------------------
Short-term investments. . . . . . . . . . . . . . .                                                             $2,625,000
Pay down of revolving line of credit. . . . . . . .                                                             $1,735,000
</TABLE>


----------------
(1)  On November  30, 2000,  we entered  into a loan for $500,000  with a 5-year
     term, secured by specific  manufacturing  equipment,  maturing November 30,
     2004, with General Electric  Capital  Corporation for the purchase of toner
     manufacturing  equipment.  The  interest  rate is 10.214%  and the  monthly
     principal and interest payments are $10,676.39.
(2)  On June 24, 1999, we entered into a loan for $1,752,000 with a 7-year term,
     secured by our business  assets,  maturing June 24, 2006,  with  SouthTrust
     Bank for the refinancing of obligations  owing the bank for the acquisition
     of equipment and that due under a previous  working capital line of credit.
     The interest rate is 7.90% per annum and the monthly principal and interest
     payments are $27,205.00.

During March 2003,  using  proceeds from the offering on Form SB-2,  the Company
retired debt owed to General Electric  Capital  Corporation and SouthTrust Bank,
and to the extent  proceeds were not required in the amounts  outlined for those
purposes, they have been reallocated to be used for general corporate purposes.

Pending application of the proceeds of our offering,  we temporarily reduced our
revolving  line of credit with our bank and have retained the balance of the net
proceeds in a deposit account with the bank, pending  authorization of the board
of director's to make the investments recommended by management.

No direct or indirect  payments to  directors,  officers,  their  associates  or
persons owing ten (10) percent or more of the  Company's  common stock were made
with proceeds from the Company's offering on Form SB-2

On March 4, 2003,  the Company  completed the  repurchase  from a stockholder of
12,939 shares of the Company's  common stock  together with warrants to purchase
25,878  shares of the Company's  common stock at an exercise  price of $2.00 per
share for $25,878. The shares and warrants were originally sold in the Company's
private  placement  that was  completed  in  December  2001,  and the shares and
warrants repurchased by the Company were cancelled.

On February 27, 2003,  the Company  entered into an agreement with a stockholder
to repurchase  150,000  shares of common stock and warrants to purchase  300,000
shares of the  Company's  common stock at an exercise  price of $2.00 per share.
Under the agreement,  the stockholder has a one-time right to cancel the sale of
the common  stock and  warrants  not yet paid for by the  Company  upon  written
notice to the Company. Upon receipt of such notice, the Company is not obligated
to purchase the remaining common stock and warrants. The agreement provides that
the  Company is to pay $2.00 for each common  share and warrant to purchase  two
common shares of the Company's  common stock.  The shares and warrants are to be
repurchased in approximately  equal installments over nine months,  beginning in
March and ending in November  2003. On March 24, 2003,  the Company  repurchased
16,672 of the Company's  common  shares and warrants to purchased  33,344 common
shares,  paying $33,344.  The shares and warrants repurchased by the Company are
held in escrow,  pending the  completion of the  repurchase in November 2003, or
its earlier cancellation, at which time they will be cancelled.



                                       25
<PAGE>

ITEM 3. Defaults upon Senior Securities

None

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

None

ITEM 5. Other Information

None

ITEM 6 -EXHIBITS AND REPORTS ON FORM 8-K

(a) EXHIBITS


Exhibit
No.       Description
-------   -----------
2.1       Merger Agreement and Plan of Reorganization dated May 16, 2000, by and
          between  Advatex   Associates,   Inc.,   Logical   Imaging   Solutions
          Acquisition  Corp., Color Imaging  Acquisition Corp.,  Logical Imaging
          Solutions,  Inc., and Color Image, Inc.,  incorporated by reference to
          the Registrant's Form 8-K filed on July 17, 2000.
2.2       Amendment  No. 1 to the Merger  Agreement  and Plan of  Reorganization
          dated June 15, 2000,  incorporated  by  reference to the  Registrant's
          Form 8-K filed on July 17, 2000
2.3       Amendment  No. 2 to the Merger  Agreement  and Plan of  Reorganization
          dated June 26, 2000,  incorporated  by  reference to the  Registrant's
          Form 8-K filed on July 17, 2000
2.4(1)    Share Exchange  Agreement dated as of September 11, 2002 between Color
          Imaging,  Inc., Logical Imaging Solutions,  Inc., Digital Color Print,
          Inc., and the shareholders of Digital Color Print, Inc.,  incorporated
          by  reference  to  Exhibit  2.1 to the  Registrant's  Form  8-K  filed
          September 26, 2002.
2.5       Amendment No. 1 to Share Exchange  Agreement dated as of September 20,
          2002 between Color Imaging,  Inc.,  Logical Imaging  Solutions,  Inc.,
          Digital  Color Print,  Inc.,  and the  shareholders  of Digital  Color
          Print,  Inc.,   incorporated  by  reference  to  Exhibit  2.2  to  the
          Registrant's Form 8-K filed September 26, 2002.
3.1       Certificate of Incorporation, incorporated by reference to Exhibit 3.1
          to the Registration statement on Form SB-2 filed July 15, 2002.
3.2       Bylaws,  incorporated by reference to the Registrant's Form 10-QSB for
          the quarter ended March 31, 2002.
4.1       Stock  Purchase   Agreement   between  the  Company  and  Wall  Street
          Consulting Corp. dated October 30, 2001,  incorporated by reference to
          Exhibit 4.1 to the  Registration  statement on Form SB-2 filed May 31,
          2002.
4.2       Promissory  Note of Wall Street  Consulting  Corp.  dated  October 30,
          2001,  incorporated  by reference  to Exhibit 4.2 to the  Registration
          statement on Form SB-2 filed May 31, 2002.
4.3       Form of  Warrant  issued  to  Selling  Stockholders,  incorporated  by
          reference  to Exhibit 4.3 to the  Registration  statement on Form SB-2
          filed November 28, 2001.
4.4       Loan and Security  Agreement between Color Imaging and Southtrust Bank
          dated May 5, 2000,  incorporated  by  reference  to Exhibit 4.4 to the
          Registration statement on Form SB-2 filed May 31, 2002.
4.5       Amendment of Loan Documents  between Color Imaging and SouthTrust Bank
          dated August 30, 2000, incorporated by reference to Exhibit 4.5 to the
          Registration statement on Form SB-2 filed May 31, 2002.
4.6       Second   Amendment  of  Loan  Documents   between  Color  Imaging  and
          SouthTrust Bank dated November 30, 2000,  incorporated by reference to
          Exhibit 4.6 to the  Registration  statement on Form SB-2 filed May 31,
          2002.


                                       26
<PAGE>

4.7       Third Amendment of Loan Documents between Color Imaging and SouthTrust
          Bank dated June 30, 2001,  incorporated by reference to Exhibit 4.7 to
          the Registration statement on Form SB-2 filed May 31, 2002.
4.8       Fourth   Amendment  of  Loan  Documents   between  Color  Imaging  and
          SouthTrust  Bank dated November 1, 2001,  incorporated by reference to
          Exhibit 4.8 to the  Registration  statement on Form SB-2 filed May 31,
          2002.
4.9       Fifth Amendment of Loan Documents between Color Imaging and SouthTrust
          Bank dated December 31, 2001, incorporated by reference to Exhibit 4.9
          to the Registration statement on Form SB-2 filed May 31, 2002.
4.10      Sixth Amendment of Loan Documents between Color Imaging and Southtrust
          Bank dated February 7, 2002, incorporated by reference to Exhibit 4.10
          to the Registration statement on Form SB-2 filed April 11, 2002.
4.11      $500,000  Line of Credit  Promissory  Note issued to  Southtrust  Bank
          dated May 5, 2000,  incorporated  by  reference to Exhibit 4.11 to the
          Registration statement on Form SB-2 filed May 31, 2002.
4.12      $500,000 Amended and Restated Line of Credit Promissory Note issued to
          Southtrust  Bank dated August 30, 2000,  incorporated  by reference to
          Exhibit 4.12 to the Registration  statement on Form SB-2 filed May 31,
          2002.
4.13      $500,000  Revolving  Note  Modification  Agreement  dated November 30,
          2000,  incorporated  by reference to Exhibit 4.11 to the  Registration
          statement on Form SB-2 filed November 28, 2001.
4.14      $500,000 Second  Revolving Note  Modification  Agreement dated July 5,
          2001,  incorporated  by reference to Exhibit 4.14 to the  Registration
          statement on Form SB-2 filed May 31, 2002.
4.15      $1,500,000  Revolving Note between Color Imaging and  SouthTrust  Bank
          dated June 24, 1999,  incorporated by reference to Exhibit 4.15 to the
          Registration statement on Form SB-2 filed May 31, 2002.
4.16      $1,500,000 Revolving Note Modification Agreement between Color Imaging
          and SouthTrust  Bank dated May 5, 2000,  incorporated  by reference to
          Exhibit 4.14 to the Registration statement on Form SB-2 filed November
          28, 2001.
4.17      $1,500,000 Second Revolving Note Modification  Agreement between Color
          Imaging and  SouthTrust  Bank dated August 30, 2000,  incorporated  by
          reference to Exhibit 4.17 to the  Registration  statement on Form SB-2
          filed May 31, 2002.
4.18      $1,500,000 Third Revolving Note  Modification  Agreement between Color
          Imaging and SouthTrust  Bank dated November 30, 2000,  incorporated by
          reference to Exhibit 4.18 to the  Registration  statement on Form SB-2
          filed May 31, 2002.
4.19      $1,500,000 Fourth Revolving Note Modification  Agreement between Color
          Imaging  and  SouthTrust  Bank  dated July 5,  2001,  incorporated  by
          reference to Exhibit 4.19 to the  Registration  statement on Form SB-2
          filed May 31, 2002.
4.20      $2,500,000 Fifth Revolving Note  Modification  Agreement between Color
          Imaging and SouthTrust  Bank dated December 31, 2001,  incorporated by
          reference to Exhibit 4.20 to the  Registration  statement on Form SB-2
          filed May 31, 2002.
4.21      $1,752,000  Installment Note between Color Imaging and SouthTrust Bank
          dated June 24, 1999,  incorporated by reference to Exhibit 4.21 to the
          Registration statement on Form SB-2 filed May 31, 2002.
4.22      $1,752,000 Term Loan Documents  Modification  Agreement  between Color
          Imaging and  SouthTrust  Bank dated August 30, 2000,  incorporated  by
          reference to Exhibit 4.22 to the  Registration  statement on Form SB-2
          filed May 31, 2002.
4.23      SouthTrust  Bank waiver letter dated March 26, 2001,  incorporated  by
          reference to Exhibit 4.22 to the  Registration  statement on Form SB-2
          filed February 11, 2002.
4.24      SouthTrust  Bank  waiver  letter  dated May 8, 2001,  incorporated  by
          reference to Exhibit 4.23 to the  Registration  statement on Form SB-2
          filed February 11, 2002.


                                       27
<PAGE>

4.25      SouthTrust  Bank waiver letter dated August 13, 2001,  incorporated by
          reference to Exhibit 4.24 to the  Registration  statement on Form SB-2
          filed February 11, 2002.
4.26      SouthTrust Bank waiver letter dated October 31, 2001,  incorporated by
          reference to Exhibit 4.25 to the  Registration  statement on Form SB-2
          filed February 11, 2002.
4.27      Development   Authority  of  Gwinnett   County,   Georgia   Industrial
          Development  Trust  Indenture  dated  June 1,  1999,  incorporated  by
          reference to Exhibit 4.27 to the  Registration  statement on Form SB-2
          filed May 31, 2002.
4.28      Loan  Agreement  between  the  Company,  Kings  Brothers  LLC  and the
          Development Authority of Gwinnett County,  Georgia dated June 1, 1999,
          incorporated  by  reference  to  Exhibit  4.28  to  the   Registration
          statement on Form SB-2 filed May 31, 2002.
4.29      Joint Debtor  Agreement  dated June 28, 2000 by and among Color Image,
          Inc., Kings Brothers,  LLC, Dr. Sueling Wang,  Jui-Chi Wang,  Jui-Kung
          Wang, and Jui-Hung Wang,  incorporated by reference to Exhibit 4.28 to
          the Registration statement on Form SB-2 filed February 11, 2002.
4.30      First Amendment to Joint Debtor Agreement dated January 1, 2001 by and
          among Color Imaging,  Kings Brothers,  LLC, Dr. Sueling Wang,  Jui-Chi
          Wang,  Jui-Kung Wang, and Jui-Hung Wang,  incorporated by reference to
          Exhibit 4.29 to the Registration statement on Form SB-2 filed February
          11, 2002.
4.31      Master Security  Agreement  between Color Imaging and General Electric
          Capital Corporation dated November 30, 2000, incorporated by reference
          to  Exhibit  4.22 to the  Registration  statement  on Form SB-2  filed
          November 28, 2001.
4.32      Promissory Note issued to General Electric Capital  Corporation  dated
          November  30, 2000,  incorporated  by reference to Exhibit 4.23 to the
          Registration statement on Form SB-2 filed November 28, 2001.
4.33      $200,000  Promissory Note between Color Imaging and Kings Brothers LLC
          dated November 19, 2001,  incorporated by reference to Exhibit 4.32 to
          the Registration statement on Form SB-2 filed February 11, 2002.
4.34      $500,000  Promissory Note between Color Imaging and Sueling Wang dated
          March 14,  2002,  incorporated  by  reference  to Exhibit  4.34 to the
          Registration statement on Form SB-2 filed April 11, 2002.
4.35      $240,000  Promissory Note between Color Imaging and Kings Brothers LLC
          dated July 6, 2000,  incorporated  by reference to Exhibit 4.35 to the
          Registration statement on Form SB-2 filed April 11, 2002.
4.36      $50,000  Promissory  Note  between  the  Company and Daniel Wang dated
          October 23,  1998,  incorporated  by  reference to Exhibit 4.36 to the
          Registration statement on Form SB-2 filed April 11, 2002.
4.37      $112,000  Promissory  Note between Color Imaging and Daniel Wang dated
          October 16,  1998,  incorporated  by  reference to Exhibit 4.37 to the
          Registration statement on Form SB-2 filed April 11, 2002.
4.38      $90,000  Promissory  Note between Color Imaging and Michael Wang dated
          June  4,  1999,  incorporated  by  reference  to  Exhibit  4.38 to the
          Registration statement on Form SB-2 filed April 11, 2002.
4.39      $150,000  Promissory  Note between Color Imaging and AccuRec LLC dated
          February 3, 2000,  incorporated  by  reference  to Exhibit 4.39 to the
          Registration statement on Form SB-2 filed April 11, 2002.
4.40      $200,000  Promissory  Note between Color Imaging and AccuRec LLC dated
          March 7,  2000,  incorporated  by  reference  to  Exhibit  4.40 to the
          Registration statement on Form SB-2 filed April 11, 2002.
4.41      $200,000  Promissory  Note between Color Imaging and AccuRec LLC dated
          April 10,  2000,  incorporated  by  reference  to Exhibit  4.41 to the
          Registration statement on Form SB-2 filed April 11, 2002.
4.42      $200,000  Promissory  Note between Color Imaging and AccuRec LLC dated
          May  2,  2000,  incorporated  by  reference  to  Exhibit  4.42  to the
          Registration statement on Form SB-2 filed April 11, 2002.
4.43      $500,000  Promissory  Note between Color Imaging and AccuRec LLC dated
          July  5,  2000,  incorporated  by  reference  to  Exhibit  4.43 to the
          Registration statement on Form SB-2 filed April 11, 2002.
4.44      $200,000  Promissory  Note between Color Imaging and AccuRec LLC dated
          September 14, 2000,  incorporated  by reference to Exhibit 4.44 to the
          Registration statement on Form SB-2 filed April 11, 2002.


                                       28
<PAGE>

4.45      $200,000  Promissory  Note between Color Imaging and AccuRec LLC dated
          October 4, 2000,  incorporated  by  reference  to Exhibit  4.45 to the
          Registration statement on Form SB-2 filed April 11, 2002.
4.46      $200,000  Promissory  Note between Color Imaging and AccuRec LLC dated
          November 3, 2000,  incorporated  by  reference  to Exhibit 4.46 to the
          Registration statement on Form SB-2 filed April 11, 2002.
4.47      Seventh   Amendment  of  Loan  Documents  between  Color  Imaging  and
          SouthTrust  Bank dated June 28,  2002,  incorporated  by  reference to
          Exhibit 4.47 to the Registration statement on Form SB-2 filed July 15,
          2002.
4.48      $2,500,000 Sixth Revolving Note  Modification  Agreement between Color
          Imaging and SouthTrust Bank, incorporated by reference to Exhibit 4.48
          to the Registration statement on Form SB-2 filed July 15, 2002.
4.49      Partial Loan Liability Release  Agreement between Color Imaging,  Inc.
          and  SouthTrust  Bank  dated  September  24,  2002,   incorporated  by
          reference to Exhibit 4.49 to the  Registration  statement on Form SB-2
          filed October 2, 2002.
4.50      $500,000 Promissory Note between Color Imaging and Jui Hung Wang dated
          August 21,  2002,  incorporated  by  reference  to Exhibit 4.50 to the
          Registration statement on Form SB-2 filed October 2, 2002.
4.51      $100,000  Promissory Note between Color Imaging and Jui Chi Wang dated
          August 21,  2002,  incorporated  by  reference  to Exhibit 4.51 to the
          Registration statement on Form SB-2 filed October 2, 2002.
4.52      First  Note  Modification  Agreement  between  Sueling  Wang and Color
          Imaging  dated August 27, 2002,  incorporated  by reference to Exhibit
          4.52 to the Registration statement on Form SB-2 filed October 2, 2002.
10.1      Employment  Agreement  between  Color  Imaging and Michael W.  Brennan
          dated June 28, 2000,  incorporated by reference to Exhibit 10.1 to the
          Registration statement on Form SB-2 filed November 28, 2001.
10.2      Employment  Agreement between Color Imaging and Dr. Sueling Wang dated
          June 28,  2000,  incorporated  by  reference  to  Exhibit  10.2 to the
          Registration statement on Form SB-2 filed November 28, 2001.
10.3      Employment  Agreement  between  the  Company and Morris E. Van Asperen
          dated June 28, 2000,  incorporated by reference to Exhibit 10.3 to the
          Registration statement on Form SB-2 filed November 28, 2001.
10.4      Employment  Agreement  between  Color  Imaging and Charles R.  Allison
          dated June 30, 2000,  incorporated by reference to Exhibit 10.4 to the
          Registration statement on Form SB-2 filed November 28, 2001.
10.5      Lease  Agreement  between Color  Imaging and Kings  Brothers LLC dated
          April 1,  1999,  incorporated  by  reference  to  Exhibit  10.5 to the
          Registration statement on Form SB-2 filed November 28, 2001.
10.6      Amendment  No. 1 to Lease  Agreement  between  the  Company  and Kings
          Brothers LLC dated April 1, 1999, incorporated by reference to Exhibit
          10.6 to the  Registration  statement  on Form SB-2 filed  November 28,
          2001.
10.7      Letter of Agreement to Employment  Agreement between Color Imaging and
          Michael W. Brennan dated June 10, 2002  (incorporated  by reference to
          Exhibit 10.7 to  Registrant's  Form 10-QSB filed for the quarter ended
          June 30, 2002)
10.8      Termination  Agreement  between  Michael W. Brennan and Color  Imaging
          dated September 30, 2002, incorporated by reference to Exhibit 10.9 to
          the Registration statement on Form SB-2 filed October 2, 2002.
10.9      Form of Warrant between  Digital Color Print,  Inc. and Color Imaging,
          Inc.,  incorporated by reference to Exhibit 10.10 to the  Registration
          statement on Form SB-2 filed November 13, 2002.
10.10     Employment  and Deferred  Compensation  Agreement  Amendments  between
          Charles  R.  Allison  and Color  Imaging,  Inc.,  December  27,  2002,
          incorporated  by reference to Exhibit 10.11 to the  Registrant's  Form
          10-K for the year ended December 31, 2002
10.11     $1,752,000  Installment  Note Amendment  between  SouthTrust  Bank and
          Color Imaging, Inc. dated February 5, 2003,  incorporated by reference
          to  Exhibit  10.12 to the  Registrant's  Form 10-K for the year  ended
          December 31, 2002


                                       29
<PAGE>

10.12     Commercial  Lease Agreement  Amendment  between Kings Brothers LLC and
          Color Imaging, Inc. dated February 5, 2003,  incorporated by reference
          to  Exhibit  10.13 to the  Registrant's  Form 10-K for the year  ended
          December 31, 2002
10.13     Purchase  and Sale and Release  Agreement  between  Michael  Edson and
          Color Imaging, Inc. dated February 27, 2003, incorporated by reference
          to  Exhibit  10.14 to the  Registrant's  Form 10-K for the year  ended
          December 31, 2002
10.14     Purchase and Sale and Release  Agreement  between  Stephen Chromik and
          Color Imaging, Inc. dated February 27, 2003, incorporated by reference
          to  Exhibit  10.15 to the  Registrant's  Form 10-K for the year  ended
          December 31, 2002
10.15     Form of  Indemnification  Agreement,  incorporated by reference to the
          post effective Amendment No. 1 to Form SB-2 filed April 1, 2003.
99.1+     Certification  pursuant  to 18 U.S.C.  Section  1350 of Sueling  Wang,
          principal executive officer, dated April 30, 2003.
99.2+     Certification  pursuant  to 18  U.S.C.  Section  1350 of Morris E. Van
          Asperen, chief financial officer, April 30, 2003.

------------------------
(1) Pursuant to Rule  601(b)(2),  the schedules  and exhibits to this  Agreement
shall not be filed.  A list of the  schedules  and  exhibits is contained on the
last page of the Agreement.  The Registrant  agrees to furnish  supplementally a
copy of any of the omitted schedules and exhibits to the Securities and Exchange
Commission upon request.
+    Filed herewith.


(b) REPORTS ON FORM 8-K

On January 24, 2003,  the Company filed a Current  Report on Form 8-K announcing
On January 23, 2003, Color Imaging,  Inc.'s registration  statement on Form SB-2
(SEC Reg. No.  333-76090) was declared  effective by the Securities and Exchange
Commission in accordance with Item 5 of Form 8-K.

On March 7, 2003, the Company filed a Current Report on Form 8-K announcing that
Color Imaging received  subscription  proceeds of $6,075,000 for the public sale
of 4,500,000  shares of its common stock from an affiliate,  and that subject to
acceptance  by Color Imaging of the  investment in accordance  with the offering
procedures, Color Imaging intended to terminate the offering effective March 13,
2003 and accept no additional  subscriptions  in accordance  with Item 5 of Form
8-K.




                                       30
<PAGE>

                                   SIGNATURES


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


                                       COLOR IMAGING, INC.




                                       /S/ SUELING WANG
                                       --------------------------------------
April 30, 2003                         Sueling Wang, PhD
                                       President (principal executive officer)





                                       /S/ MORRIS E. VAN ASPEREN
                                       --------------------------------------
                                       Morris E. Van Asperen
                                       Executive Vice President and
                                       Chief Financial Officer





                                       31
<PAGE>


                            CERTIFICATION PURSUANT TO
                  SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002


     I, Sueling Wang,  president and principal  executive officer of registrant,
certify that:

1.   I have reviewed this quarterly report on Form 10-Q of Color Imaging, Inc.;

2.   Based on my knowledge,  this  quarterly  report does not contain any untrue
     statement of a material fact or omit to state a material fact  necessary to
     make the statements  made, in light of the  circumstances  under which such
     statements  were made, not misleading with respect to the period covered by
     this quarterly report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in this  quarterly  report,  fairly  present  in all
     material respects the financial  condition,  results of operations and cash
     flows of the  registrant  as of, and for,  the  periods  presented  in this
     quarterly report.

4.   The  registrant's  other  certifying  officers  and I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

     a)   designed  such  disclosure  controls  and  procedures  to ensure  that
          material  information  relating  to  the  registrant,   including  its
          consolidating subsidiaries, is made known to us by others within those
          entities,  particularly  during  the  period in which  this  quarterly
          report is being prepared;
     b)   evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures as of a date within 90 days prior to the filing of this
          quarterly report (the "Evaluation Date"); and
     c)   presented  in  this  quarterly   report  our  conclusions   about  the
          effectiveness  of the disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date.

5.   The registrant's other certifying  officers and I have disclosed,  based on
     our most recent  evaluation,  to the  registrant's  auditors  and the audit
     committee of  registrant's  board of directors (or persons  performing  the
     equivalent functions):

     a)   all  significant  deficiencies  in the design or operation of internal
          controls  which could  adversely  affect the  registrant's  ability to
          record,  process,   summarize  and  report  financial  data  and  have
          identified for the  registrant's  auditors any material  weaknesses in
          internal controls; and

     b)   any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          controls; and

6.   The  registrant's  other  certifying  officers and I have indicated in this
     quarterly report whether or not there were significant  changes in internal
     controls  or in other  factors  that could  significantly  affect  internal
     controls  subsequent to the date of our most recent  evaluation,  including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.

                                       COLOR IMAGING, INC.


                                       /S/ SUELING WANG
                                       ---------------------------------------
         April 30, 2003                Sueling Wang, PhD
                                       President (principal executive officer)


                                       32
<PAGE>

                            CERTIFICATION PURSUANT TO
                  SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002


     I, Morris E. Van Asperen,  executive  vice  president  and chief  financial
officer of registrant, certify that:

1.   I have reviewed this quarterly report on Form 10-Q of Color Imaging, Inc.;

2.   Based on my knowledge,  this  quarterly  report does not contain any untrue
     statement of a material fact or omit to state a material fact  necessary to
     make the statements  made, in light of the  circumstances  under which such
     statements  were made, not misleading with respect to the period covered by
     this quarterly report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in this  quarterly  report,  fairly  present  in all
     material respects the financial  condition,  results of operations and cash
     flows of the  registrant  as of, and for,  the  periods  presented  in this
     quarterly report.

4.   The  registrant's  other  certifying  officers  and I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

     a)   designed  such  disclosure  controls  and  procedures  to ensure  that
          material  information  relating  to  the  registrant,   including  its
          consolidating subsidiaries, is made known to us by others within those
          entities,  particularly  during  the  period in which  this  quarterly
          report is being prepared;
     b)   evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures as of a date within 90 days prior to the filing of this
          quarterly report (the "Evaluation Date"); and
     c)   presented  in  this  quarterly   report  our  conclusions   about  the
          effectiveness  of the disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date.

5.   The registrant's other certifying  officers and I have disclosed,  based on
     our most recent  evaluation,  to the  registrant's  auditors  and the audit
     committee of  registrant's  board of directors (or persons  performing  the
     equivalent functions):

     a)   all  significant  deficiencies  in the design or operation of internal
          controls  which could  adversely  affect the  registrant's  ability to
          record,  process,   summarize  and  report  financial  data  and  have
          identified for the  registrant's  auditors any material  weaknesses in
          internal controls; and

     b)   any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          controls; and

6.   The  registrant's  other  certifying  officers and I have indicated in this
     quarterly report whether or not there were significant  changes in internal
     controls  or in other  factors  that could  significantly  affect  internal
     controls  subsequent to the date of our most recent  evaluation,  including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.

                                       COLOR IMAGING, INC.


                                       /S/ MORRIS E. VAN ASPEREN
                                       ------------------------------------
         April 30, 2003                Morris E. Van Asperen
                                       Executive Vice President and
                                       Chief Financial Officer





                                       33
1612924