SECURITIES
AND EXCHANGE COMMISSION


Washington, D.C.
20549





FORM
10-K





xANNUAL REPORT PURSUANT
TO SECTION 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934


For the
fiscal year ended: December 31, 2009


OR





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





For the
transition period from __________ to __________





Commission
File No. 
000-52408





EMERGING
MEDIA HOLDINGS, INC.


(Exact
name of Registrant as Specified in Its Charter)




Nevada
            
            13-1026995(State or other
      jurisdiction of
              Incorporation or
      organization)
            
            (I.R.S.
      Employer
              Identification
      No.)




1809 E. BROADWAY
      ST., SUITE 175, OVIEDO, FL
            
            32765(Address of
      principal executive offices)
            
            (Zip
  Code)




Issuer's
Telephone Number, Including Area Code:  (806)
688-9697


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





Securities
registered pursuant to Section 12(g) of the Act:  Common Stock, $.001
par value per share





Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act.Yes o   No
x





Indicate
by checkmark if the registrant is not required to file reports to Section 13 or
15(d)Of the
Act.              o Yes  x No





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. x  Yes    o  No





Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K (§229.405 of this chapter) is not contained herein, and will not
be contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. x





Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such
files).    Yes o    No o





Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, or a smaller reporting company.  (Check
One):




Large accelerated
      filer  o
            Accelerated
      filer  oNon-accelerated
      filer  o
            Smaller reporting
      company  x(Do not check if a
      smaller reporting company)





Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).  o  Yes   
x  No





The
aggregate market value of the voting and non-voting common equity held by
non-affiliates  as of the last business day of the registrant’s most
recently completed second fiscal quarter was $5,001,000.





Number of
shares of Common Stock outstanding as of March 26, 2010: 16,303,000
shares.





Documents
incorporated by reference:  None














TABLE OF
CONTENTS







PART IItem 1.
            Business.
            4Item
      1A.
            Risk
    Factors.
            8Item 1B.
            Unresolved Staff Comments.
            11Item 2.
            Properties.
            11Item
      3.
            Legal
      Proceedings.
            11Item
      4.
            Reserved.
            11PART IIItem 5.
            Market for
      Registrant's Common Equity, Related Shareholder Matters and Issuer
      Purchases of Equity Securities.
            12Item 6.
            Selected Financial
      Data.
            12Item 7.
            Management's
      Discussion and Analysis of Financial Condition and Results of
      Operations.
            13Item 7A.
            Quantitative and
      Qualitative Disclosures About Market Risk.
            18Item 8.
            Financial Statements
      and Supplementary Data.
            19Item 9.
            Changes In and
      Disagreements With Accountants on Accounting and Financial
      Disclosure.
            50Item 9A (T).
            Controls and
      Procedures.
            50Item 9B.
            Other
      Information.
            50PART IIIItem 10.
            Directors, Executive
      Officers, and Corporate Governance.
            51Item 11.
            Executive
      Compensation.
            55Item 12.
            Security Ownership
      of Certain Beneficial Owners and Management and Related Stockholder
      Matters.
            56Item 13.
            Certain
      Relationships and Related Transactions, and Director
      Independence.
            56Item
    14.
            Principal Accountant
      Fees and Services
            57Item 15.
            Exhibits and
      Financial Statement Schedules.
            58SIGNATURES
            
            59





iii




PART
I




Item
1. Business.




General





Throughout
this Form 10-K, the terms "we," "us," "our," and the "Company" refer to Emerging
Media Holdings, Inc., a Nevada corporation, and, unless the context indicates
otherwise, includes our subsidiaries.





We were
incorporated under the laws of the State of Nevada on September 3, 2003. On June
30, 2006, we effectuated a share exchange whereby we acquired all of the
outstanding equity interests in our wholly-owned subsidiary, IM “Media Alianta”
SRL (formerly SC “Cabavarum” SRL) , the 100% owner of SA “Analiticmedia-Grup”,
both Moldovan companies ("AMG"). AMG was formed in October, 1998 as a Republic
of Moldova limited liability company, which is comparable to a limited liability
company in the United States. Since 2006, AMG has been an exclusive operator in
Moldova of Russian TV channels “NTV federal television channel” and “NTV-World”.
These programs are owned by Gazprom Media, a wholly-owned subsidiary of GazProm
Corporation. AMG’s main business is the production and broadcasting of
television programs and news reports primarily for the Moldovan viewing
audience.





On May 2,
2008, the Company acquired the common stock of “TNT-Bravo” channel-ICS “Media
Top Prim” SRL (Media Top Prim), the exclusive operator in Moldova of Russian
channel TNT programs owned by Gazprom Media.  The acquisition
agreement, as amended, provided for the acquisition to be made with 1,000,000
shares of the Company’s common stock, valued at $4.0 million.




On August
20, 2008, the Company became a 50% partner of Alkasar Region LLC and created a
new advertising agency-an exclusive agent for both TV channels TV7 NTV and
TNT-Bravo, named ICS “Alkasar Media Services” SRL (Alkasar Media
Services).




On
October 1, 2009, we closed an acquisition of 60% of the outstanding shares of SC
Genesis International SA, a joint stock company incorporated under the laws of
Romania (“Genesis”), pursuant to a Share Purchase Agreement, executed as of June
10, 2009, by and between the Company and Genesis.  The consideration
paid by the Company for the acquisition of Genesis was $4,800,000 paid to the
holder of a majority of the outstanding shares of Genesis. On February 23, 2010,
we acquired an additional 20% of the outstanding shares of Genesis, so that we
now own 80% of the outstanding shares of the company.





We own
100% of the equity interests in AMG, Media Top Prim and 80% of the equity in
Genesis. All of our operations are conducted through our subsidiaries, and the
following discussion of our business includes the businesses of AMG, Media Top
Prim and Genesis. All financial information is reflected in U.S. dollars, unless
otherwise noted.




Our Media
Operations





All of
our TV production and broadcasting operations are conducted in the Republic of
Moldova, which is located between Romania and Ukraine in Eastern Europe. Having
our production facilities in the Republic of Moldova generates certain
challenges for us, as outlined in the following country political
summary:





o
            Obtaining
      independent public authority (Audiovisual Counsel of Republic of Moldova)
      government approval and licensing relating to the operation of a business
      can still be time-consuming, costly and
  bureaucratic.


o
            The
      country's legal, regulatory and accounting systems are in the process of
      transitioning to a market-based system versus a state-influenced system
      and these new systems are not yet entirely consistent with international
      laws. The infrastructure in the country is relatively poor by U.S. and
      Western European standards.


o
            In
      July 2009, early parliamentary elections were held for the XVIII
      convocation. The five parties involved were- Moldovan Communist Party, the
      Liberal Democratic Party of Moldova, Liberal Party Democratic Party
      of Moldova and the Party Alliance Our Moldova. As a result of the
      elections, the Communists gained 48 seats in Parliament (out of 101), the
      Liberal Democrats - 18, Liberals - 15, ASM - 7, and the Democrats -
      13.


o
            The
      democratic parties held talks for more than a week on forming a coalition
      and in August 2009 the parties established a governing coalition termed
      the "Alliance for European
      Integration", in this way controlling the majority of the seats (53 seats)
      in Parliament.


o
            At
      this time, the country is governed by the Democrats, but there still
      remains a risk of political instability due to failure to appoint a
      President. Currently Moldova has an interim President. The current
      democratic majority decided to solve political and constitutional crisis
      by means of a referendum and specifically by adopting a new
      Constitution.


o
            Although
      an extensive legislative base and a Center for Combating Corruption exists
      in Moldova, corruption in the state government of Moldova as well as local
      governments is extensive and the current laws, regulations and penalties
      against corruption are not strictly enforced, which can lead to
      uncertainty when working with government personnel and
      agencies.





4





AMG was
formed in October of 1998 to acquire media holdings in Moldova and surrounding
countries and to broadcast and publish acquired and original media content. In
1998, AMG signed a contract with Russian Public Television ("ORT") to broadcast
its programs in Moldova.  In 1999, AMG established the newspaper
"Vremea" and took over management of the newspaper "De Facto ". In 2002, AMG
sold its newspaper holdings to focus on the fast growing television market. At
the beginning of 2003 AMG held an estimated 60%-70% of the advertising market in
Moldova, a position confirmed by TNS GALLUP Media and AGB Nielsen Media Research
through the official television channels rating process in Moldova.





In
September of 2005, shareholders of AMG voted to create a separate frequency for
their television channel and give up operating on the state television
frequency, thus giving up a large portion of the Company's
revenues.  On March 1, 2006, AMG launched its own television channel
(TV7) that broadcasts on the 43rd decimeter frequency.  AMG signed a
contract with the Russian television companies NTV and NTV World (collectively
"NTV") that are in the leading group of television channels in Russia. Both are
owned by Gazprom Media.  On March 6, 2006, the News Department of TV7
started to broadcast the "News Bulletin", a specialized news
program.




In August
2008, we announced the creation of a new advertising company, Alkasar Media
Services, in which we are partners with Alkasar Region LLC to promote new
advertising technologies in Moldova in the media buying business. Alkasar Region
LLC is affiliated with the Gazprom-Media JSC advertising agency, selling the
advertising in more than 80 of the largest Russian cities, such as Moscow, St.
Petersburg and others. Gazprom-Media JSC is the exclusive agent for advertising
time on four Russian federal television channels and controls about 20% of
Russian television advertising, being Russia's second largest agent in the
television advertising market.The Company’s decision to create the partnership was for the purpose of
utilizing the experience of Gazprom-Media as the exclusive sales agent for
advertising time on the NTV federal television channel, the TNT regional network
and NTV-PLUS satellite television in Russia.(www.ra-alkasar.ru,
www.gpm.ru/en/advertising.xml)




Products





EMH's
products consist of programs produced by the Russian TV channels NTV and TNT and
in-house production programs. NTV is a news channel. Traditionally news programs
are watched by the largest audiences. NTV is the only broadcasting company in
Russia that on a daily basis prepares more than 10 news programs (http://www.gazprom-media.com/en/tv.xml?&company_id=47).
TNT channelis directed
at audiences aged 18-45, which are of the greatest commercial interest for
advertisers (http://www.gazprom-media.com/en/tv.xml?&company_id=49,
http://tnt-online.ru/). Focusing on entertainment, "TNT-Bravo" broadcasts an
optimal mix of programs that are of interest to its target audience. The split
of the two TV channels content for different types of viewers allows the Company
to find the best solutions to secure brand advertisers with the targeted
audience.





TV7
channel also produces its own news and analytical programs, such
as:





o    "Today
in Moldova" in the Russian language;


o    "Cotidian"
in the Romanian language;


o    "Cotidian
Exclusive" in the Romanian language;


o     Weather
forecast in Russian and Romanian languages;


o    "Public
Studio" in Russian language; and


o    "Aim
to Europe” in Romanian language.




The
revenues of the Company are dependent on advertising sales and broadcasting
sponsorships.





Sales
and Marketing





The year
2006 was the initial period of formation for our channel TV7. During this period
the TV7 channel focused on increasing its audience.





TV7 is
among the three leaders in the television broadcasting industry in Moldova based
on commercial quota or market share and ratings. In 2006, TV7 reached the second
place among other TV channels in Moldova, with 21.6% of the commercial market
share for the Capital of Moldova and 9% of the commercial market share for the
Republic of Moldova as a whole.





During
2007, TV7 increased its commercial market share up to 26.2% for the Capital of
Moldova and up to 14.9% of the commercial market share for the Republic of
Moldova as a whole.





In 2008,
the growth in the commercial market share was a result of the acquisition of the
TNT-Bravo channel and updated marketing strategies. TV7(NTV) and TNT-Bravo
channels together had a 28.5% commercial market share for the Capital of Moldova
and a 25.6% commercial market share for the Republic of Moldova as a
whole.





5





In 2009,
TV7 (NTV) and TNT-Bravo channels together represented a 25.23% commercial market
share for the Capital of Moldova and a 9.33% commercial market share for the
Republic of Moldova as a whole.




Competition





The
channel's competition in the Moldovan broadcasting market consists of other news
programs and the market share indicators (referred to sometimes as “quotas”) are
based on both the number of people watching and third party ratings. Other
non-state owned news channels in Moldova are NIT channel and Pro-TV channel,
with 10% and 2.86%, respectively, of the commercial market share for the Capital
of Moldova, and 7.56% and 1.85%, respectively, of the commercial market share
for the country.





On March
5, 2010, a new 24 hours news TV channel, JURNAL TV, was launched. JURNAL TV
became a subscriber of AGB Nielsen Media. According to a March 13, 2010 press
release, a second new 24 hours TV channel, PUPLIKA TV, will be launched. Both
channels are in developmental stage which makes it difficult to predict their
success.





The
Company's competitive advantage in the market is its news broadcasting and a
strong brand name. According to an AGB Nielsen Media Research independent
marketing study conducted in 2009, TV7 is among the three most popular news
channels in Moldova.





Employees





As of
December 31, 2009, our media operations employed a total of 72 employees, all of
whom are full-time. The average age of employees is less then 40 years old, more
then 68% of employees are highly educated, and more then 75% of employees are
involved in the production process. We do not typically hire part-time workers,
and do not anticipate doing so in the foreseeable future. We do not have a
collective bargaining agreement with our employees, nor are any of our employees
members of any labor union.





Broadcasting
Newsroom and Equipment





TV7
television channel's technical production base consists of a newsroom that can
also be used as a studio for television transmissions in recordings and live
broadcasts. TV7 also has an "on-air" apparatus room, an apparatus room for
creation of play lists, an apparatus room for subtitling from Russian to
Romanian and vice-versa, and an apparatus room for video tape editing and sound
scoring.





The
newsroom has three video cameras, Sony DSR-390, DSR-500 and DSR-250, Vinten
studio pedestals, Odyssey auto cues, DSC 545 vision production switcher, snd a
Beringer 16 fader. The lighting equipment consists of Logocam company
projectors, Ianiro filling instruments, and Logocam suspension lighting
instruments.





The
camera device studio includes four television reporter sets, DVCAM format. The
television reporter complex is has Sennheizer radio systems, lighting
instruments, jackets and other accessories.




Genesis Construction
Operations





Genesis
is a construction and development company with its principal offices located in
Bucharest, Romania. Genesis operates primarily in Romania and has, as its
principal business, the construction of roads and highways.  Other
secondary activities include surface and underground railway construction, other
special construction projects, relocation services and merchandise
transportation.





Road
Construction Operations





Road
construction projects are a primary focus of the Romanian Government. Road
construction projects for the Romanian government accounted for approximately
90% and 80% of sales in 2009 and 2008, respectively, and approximately 10% and
20% of sales, respectively, were accounted for by private entities that are
prime contractors for government road projects.





At this
moment, Romania’s road system has a total of approximately 199,000 km of roads
and highways, out of which approximately 260 km are highways, 16,060 km are
roads of state destination under the administration of National Road Company
(CNADNR), 34,700 km are county roads under the administration of the County
Councils, 27,800 km are local roads under the administration of Local Councils,
22,300 km are roads within cities and 97,700 km are roads within villages, the
latter under the administration of the local city halls.





6





The main
projects to be completed in the following years are related to the completion of
the Bucharest – Constanta highway, the Transylvania highway, ring roads to be
built for the larger cities, modernizing the national and county roads as well
as restarting the construction of the Danube – Bucharest Canal, which is planned
to be done by 2012, with an investment of €500 million EUR. Romania is projected
to receive, through 2013, structural funds of approximately €4 billion EUR,
dedicated to the transport infrastructure.





Construction
Practices





We have
introduced some modern technologies to ensure obtaining high quality
construction with increased productivity. For example, Genesis has utilized hot
recycling of the deteriorated asphaltic covers and the cold spreading of
slurry-seal for the rehabilitation of the surface of roads.  Since
this process was new for Romania, personnel training abroad was necessary, as
well as the purchase of suitable equipment and research for adaptation of these
methods to Romania. We have collaborated with specialty institutes, with the
Technical University of Constructions – Faculty of railways, roads and bridges –
Bucharest, and have also received technical support from foreign specialists
with a long experience in the field from England, Italy and Israel.





Our use
of very thin asphaltic layers has increased our productivity, reduced costs and
increased mobility of our equipment.





Genesis
currently owns various types of equipment for its different construction
activities. The equipment we own consists of an ultramodern ERMONT asphalt
plant, a cold asphalt MX30 plant, three asphalt recycling installations Marini
type (ART), three Breining installations of slurry-seal spreading, seven asphalt
pavers (Vogele, Dynapac, ABG, Marini), seven surface miners (Wirtgen, Marini),
six compaction rollers (Bomag, Dynpac, Bitelli, Simeza, Stavostroj), excavators,
dump trucks, and vehicles for transporting workers.





Insurance




We carry
social insurance for our employees and vehicle insurance for equipment owned by
Company.  Required payments to the Romanian government are for the
governmental social fund, medical insurance and pension coverage




Sources
of Materials





All the
materials used during the construction process are purchased from third
parties.




Construction
Contracts





We bid
through the official governmental process for the right to construct particular
road projects. Our contracts are generally obtained through competitive bidding
in response to advertisements by federal, state and local government agencies
and private parties. Less frequently, construction contracts may be obtained
through direct negotiations with state authorities or with private owners. Our
contract risk mitigation process includes identifying risks and opportunities
during the bidding process, review of bids fitting certain criteria by various
levels of management.





We act as
prime contractor on most of the construction projects we undertake. We
accomplish our projects with our own resources and subcontract construction work
and specialized activities. As prime contractor, we are responsible for the
performance of the entire contract, including subcontract work. Thus, we may be
subject to increased costs associated with the failure of one or more
subcontractors to perform as anticipated.





Our
construction contracts are typically one, or greater than one, years in duration
with an average contract size approximately $5 million.





Seasonality




Our road
construction business is seasonal. The Winter season from December through
February is a period of substantially reduced road construction
activity.





Competition





We
experience substantial competition when bidding for road construction projects
from a limited number of companies that operate in our markets, several of which
are larger and have greater financial resources than we do.





Employees





Genesis
has approximately 120 employees. Of these employees, 20 are in
the  corporate management and 100 are engaged in construction and
transportation work.





7




Item
1A. Risk Factors.




In
addition to the other information set forth elsewhere in this annual report, you
should carefully consider the following factors when evaluating us. An
investment in Emerging Media Holdings, Inc. will be subject to risks inherent in
our business. The trading price of our shares will be affected by the
performance of our business relative to, among other things, our competitors,
market conditions and general economic and industry conditions. The value of an
investment in Emerging Media Holdings, Inc.  may decrease, resulting
in a loss.  If any of the following risks actually occurs, our
business, financial condition and results of future operations could suffer. In
such case, the trading price of our shares could decline, and you could lose all
or part of your investment.




General




Recent
constraints on the availability of credit in the worldwide banking system may
affect our results of operations.




Recent
constraints on the availability of credit in the worldwide banking system could
adversely affect the radio and television advertising budgets of our media
customers and construction and development projects of our construction
customers and have a consequent adverse effect on our results of operations. As
a result, we would face risks of:




·
            possible
      reduction of our customers’ advertising and construction budgets since, in
      addition to our local customers, many of media our customers are part of a
      company with worldwide operations;
and




·
            possible
      economic instability in our markets in the Republic of Moldova and
      Romania.




We
could face limitations on our ability to access the capital
markets.




Our
ability to access the capital markets is subject to various factors, including
general economic and/or financial market conditions. The current conditions of
the financial markets have adversely affected the availability of credit and
liquidity resources and our access to capital markets would be more limited
until stability re-emerges in these markets.





Integration
of the business and product offerings of acquired companies could disrupt our
business operations.





We have
made a few acquisitions in the recent year and anticipate that we may, from time
to time, acquire additional businesses, assets or securities of companies that
we believe would provide a strategic fit with our business. Any business we
acquire will need to be integrated with our existing operations. While we have
not had difficulty in the past effectively assimilating the business or product
offerings of companies we have acquired, there can be no assurance that we will
not have difficulties doing so in the future. In addition, we could incur
unknown or contingent liabilities of acquired companies. Difficulties in
integrating the operations and personnel of the acquired companies could disrupt
our business operations, divert management's time and attention and impair
relationships with and risk the possible loss of key employees and customers of
the acquired business. Our failure to adequately manage the integration of any
acquisition could disrupt our business operations and lower our revenues and
profits.





Changes
in exchange rates could affect our financial results and management's ability to
make financial projections.





Our
operations are conducted primarily in the Republic of Moldova and in Romania.
The functional currency of our subsidiaries in Moldova is the Moldova lei, and
the functional currency for Genesis in Romania are the Romanian Lei and the
euro. This exposes us to risks associated with both foreign currency
translation, and foreign currency transactions.





While the
functional currencies of our operating subsidiaries are the lei and euro, we
report in U.S. dollars. In preparing our financial statements, the revenues and
expenses of such subsidiaries are translated into U.S. dollars at average
exchange rates prevailing during the period. The assets and liabilities are
translated at the rates of exchange on the balance sheet date. The resulting
translation gain and loss adjustments are recorded directly in the financial
statements and as a separate component of shareholders' equity. The amount of
such gain or loss will depend in changes in the exchange rate between the lei
and euro and the U.S. dollar and the composition of our assets and liabilities
in Moldova and Romania. If the U.S. dollar increases in value against these
currencies, the amount reported in U.S. dollars for assets, liabilities,
revenues and expenses originally recorded in these currencies will decrease.
Conversely, if the U.S. dollar decreases in value against the lei and euro, the
amount reported in U.S. dollars for assets, liabilities, revenues and expenses
originally recorded in these currencies will increase.





8





Media
Business





We
depend on our trademarks and proprietary rights for a competitive advantage in
the Moldovan market, and any failure to protect our intellectual property rights
may damage our competitive position.





Our
success depends largely upon our ability to protect our current and future
brands and products, and to defend our intellectual property rights. Competitors
infringing on our trademarks by using trademarks, trade names or trade dress
that resemble ours will dilute our intellectual property rights, which could
materially harm our ability to maintain or expand our sales and our future
financial results.




We are subject to changing media
rules and regulations.





We sell
advertising time to third parties for further resale to advertisers. Media
channels have been characterized in recent years by rapid change, including
changes in rules and regulations. Future changes may adversely affect our
ability to effectively sell advertising space, and thus may adversely affect our
ability to generate revenues.




Deterioration
of the market reforms undertaken by the Moldovan government may undermine our
ability to operate our business and predict financial performance.





The
Republic of Moldova has undergone significant political and economic change
since 1990 and any substantial change in current laws or regulations (or in the
interpretations of existing laws or regulations), whether caused by changes in
the government of Moldova or otherwise, could have an impact on our results of
operations. For example, currently there are no significant limitations on the
repatriation of profits from Moldova, and for the last ten years the government
continuously has been improving the national economy for the liberalization, but
there is no assurance that foreign exchange control restrictions or similar
limitations will not be imposed in the future with regard to repatriation of
earnings and investments from the country. If such exchange control
restrictions, or similar limitations are imposed, the ability of our U.S. parent
holding company to receive payments from its subsidiaries could be reduced,
which would reduce our ability to invest in our operations in countries other
than Moldova. If we are unable to invest in our non-Moldovan operations, our
operating results could suffer which could reduce the value of our shareholders'
investment in our common stock.





There
is no guarantee that the Republic of Moldova government will not exert greater
control over media.





The
Republic of Moldova became the first former republic of the USSR to elect a
communist majority parliament and a communist president in 2001. The communist
Party also won the majority of votes during the March 2005 parliamentary
elections, which had been recognized by US, EU and other international
observers, thus extending its majority in the parliament until 2009. Although
the current governing coalition under the banner "Alliance for European
Integration" is not communist, in this way taking the majority seats (53 seats)
in Parliament. Currently the Communist party is in the future under more
communist dominated governments, we may be required to pay additional taxes
and/or fees in connection with our production and we may not have as much
control over the operations of our day-to-day media business operations in the
Republic of Moldova.




Construction
Business





We
are vulnerable to the cyclical nature of the construction business.





The
demand for our services and products is dependent upon the existence of road
construction and other infrastructure project governmental financing. As a
result, our past results have varied considerably and may continue to vary
depending upon the demand for future projects.





We
bear the risk of cost overruns in some of our contracts. We may experience
reduced profits or, in some cases, losses under these contracts if costs
increase above our estimates.





Under our
fixed price contracts, contract prices are established in part on cost and
scheduling estimates which are based on a number of assumptions, including
assumptions about future economic conditions, prices and availability of labor,
equipment and materials, and other exigencies. If these estimates prove
inaccurate, or circumstances change such as unanticipated technical problems,
difficulties in obtaining permits or approvals, changes in local laws or labor
conditions, weather delays, cost of raw materials, our suppliers’ or
subcontractors’ inability to perform, cost overruns may occur, and we could
experience reduced profits or, in some cases, a loss for that
project.





9





The
nature of our construction business exposes us to potential liability claims and
contract disputes which may reduce our profits.





We have
been and may in future be named as a defendant in legal proceedings where
parties may make a claim for damages or other remedies with respect to our
projects or other matters. These claims generally arise in the normal course of
our business. When it is determined that we have liability, we may not be
covered by insurance or, if covered, the amount of these liabilities may exceed
our policy limits. Any liability not covered by our insurance, in excess of our
insurance limits or, if covered by insurance but subject to a high deductible,
could result in a significant loss for us, which claims may reduce our profits
and cash available for operations.





Our
continued success requires us to hire and retain qualified
personnel.





If we
cannot find and keep the employees necessary to execute our contracts or to
perform necessary corporate activities, it could have a material adverse impact
on our business or financial results.




It
can be very difficult or expensive to obtain the insurance we need for our
business operations.





Insurance
products have become increasingly expensive and sometimes very difficult to
obtain. Although we have in the past been generally able to cover our insurance
needs, there can be no assurances that we can secure all necessary or
appropriate insurance in the future.





Past
and future environmental, safety and health regulations could impose significant
additional costs on us that reduce our profits.





We are
subject to numerous environmental laws and health and safety regulations. Our
projects can involve the handling of hazardous and other highly regulated
materials which, if improperly handled or disposed of, could subject us to civil
and criminal liabilities. In addition, past activities could also have a
material impact on us.




We
generally do not have long term supply contracts and are subject to price
fluctuations for road construction materials.





Our
business is heavily dependent upon construction materials, such as asphalt
cement, which we purchase from third-party suppliers. We could experience
shortages of raw materials due to supply, production or shipment difficulties,
which could decrease our ability to supply housing to our customers. We are also
directly affected by increases in the costs of such raw materials. If we cannot
increase prices because of competitive pressure, increased construction
materials costs could reduce our profits.




Risks
Associated With Ownership of our Common Stock





It
may be difficult to effect service of U.S. process and enforce U.S. legal
process against our directors and us.





We are
organized under the laws of Nevada. Therefore, our stockholders are able to
effect service of process in the U.S. upon us. However, certain of our directors
and almost all of our operating assets are located outside the U.S. As a result,
it may not be possible to effect service of process upon our director in the
Republic of Moldova, nor may it be possible to enforce judgments of U.S. courts
against our directors or our assets. Any judgments of U.S. courts against our
directors residing outside of the United States will have to be domesticated in
the country where it is to be enforced. Original actions or actions for
enforcement of judgments of U.S. courts predicated solely upon the laws of the
U.S., including the U.S. federal securities laws, may not be enforceable in the
Republic of Moldova. In addition, awards of punitive damages in actions brought
in the U.S. or elsewhere may not be enforceable in Moldova. There are no
treaties between  U.S. and Republic of Moldova.





We
do not plan to pay cash dividends.





Holders
of our common stock are entitled to cash dividends when, as and if declared by
the board of directors out of funds legally available for the payment of
dividends. Our management does not anticipate the declaration or payments of any
dividends in the foreseeable future. We intend to retain earnings, if any, to
finance the development and expansion of our business. Our future dividend
policy will be subject to the discretion of our board of directors and will be
contingent upon future earnings, if any, our financial condition, capital
requirements, general business conditions and other factors.





10




Item
1B. Unresolved Staff Comments.




Not
applicable.




Item
2. Properties.




We are
presently seeking to lease office space for our corporate offices in the
U.S.





Media
Operations





Our
corporate offices for our media production operations in the Republic of Moldova
are located at three different places: 1, Aleco Russo street, 2nd
floor, Chisinau, Moldova, where we own approximately 8,634 square feet of office
space for TV7 channel; 1, Aleco Russo, 15th
floor, Chisinau, Moldova, where we own 548 square feet for TNT Bravo TV channel;
202, Stefan cel Mare Avenue, 9th
floor, where we own 2,583 square feet for the Alkasar Media Services advertising
agency. We believe that our existing media facilities are adequate to support
our existing operations and that, if needed, we will be able to obtain suitable
additional facilities on commercially reasonable terms.





Construction
Operations





Genesis
does not own any land or buildings.  Genesis leases its principal
office located at 192 Calea, 13 Septembrie 192 Street, District 5, Bucharest,
Romania, under a five year lease, expiring in 2012, at a monthly rental of
$2,700. Genesis also leases land lots, on seasonal basis, for operation of its
construction activities




Item
3. Legal Proceedings.




The
Company is a defendant in a lawsuit captioned Case File No. 44.952/3/2007,
Compania Nationala de Autostrazi si Drumuri Nationale in Romania ("CNADR") vs.
Genesis International S.A., brought before ICCJ - Commercial
Department.  CNADR has asked the court for the Company to pay $217,238
as a penalty for delay in the execution of the works set forth in Contract No.
2187/2003 - "Primary Rehabilitation of DN 58 Caransebes - Anina" and in Contract
No. 2185/2003 - "Primary Rehabilitation of DN 41 Dara -
Oltenita".  The Company believes it does not owe the penalty and
intends to vigorously protest the amount.  A hearing is set for April
15, 2010.




Item
4. Reserved.





11





PART
II





Item
5. Market for Registrant's Common Equity, Related Shareholder Matters and Issuer
Purchases of Equity Securities.





Market
Information





Our
common shares are trading in the OTC Bulletin Board market under the symbol
“EMDH.OB”.





The
following table sets forth, for the periods indicated, the high and low bid
prices of our common stock (commencing our recapitalization), as reported in
published financial sources.  Quotations reflect inter-dealer prices,
without retail mark-up, mark-down, commission, and may not represent actual
transactions.





Fiscal
      Year Ended December 31, 2008
            High
            
            
            LowQuarter
      Ended December 31, 2008
            $1.00
            
            $
            .08Quarter
      Ended September 30, 2008
            2.40
            
            
            .58Quarter
      Ended June 30, 2008
            4.30
            
            
            1.45Quarter
      Ended March 31, 2008
            8.85
            
            
            2.80Fiscal
      Year Ended December 31, 2009Quarter
      Ended March 31, 2009
            .40
            
            
            .10Quarter
      Ended June 30, 2009
            1.01
            
            
            .12Quarter
      Ended September 30, 2009
            .61
            
            
            .15Quarter
      Ended December 31, 2009
            .99
            
            
            .19Fiscal
      Year Ended December 31, 2010Quarter
      Ended March 31, 2010 (Through March 26, 2010)
            .50
            
            
            .21





Holders





As of
March 26, 2010, there were approximately 115 holders of record of our common
stock.





Dividends





We do not
anticipate paying cash dividends in the foreseeable future. Our current policy
is to retain any earnings to finance our future development and
growth.  We may reconsider this policy from time to time in light of
conditions then existing, including our earnings performance, financial
condition and capital requirements.  Any future determination to pay
cash dividends will be at the discretion of our board of directors and will
depend upon our financial condition, operating results, capital requirements,
general business conditions and other factors that our board of directors deems
relevant.





Recent
Sales of Unregistered Securities





Not
applicable.





Purchases
of Equity Securities by the Registrant





None.




Item
6. Selected Financial Data.





Not
applicable.





12




Item
7. Management's Discussion and Analysis of Financial Condition and Results of
Operations.







DISCLOSURE
REGARDING FORWARD-LOOKING STATEMENTS





Throughout
this report, we make statements that may be deemed "forward-looking" statements
within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. All statements, other than statements of historical facts, that address
activities, events, outcomes and other matters that the Company plans, expects,
intends, assumes, believes, budgets, predicts, forecasts, projects, estimates or
anticipates (and other similar expressions) will, should or may occur in the
future are forward-looking statements. These forward-looking statements are
based on management's current belief, based on currently available information,
as to the outcome and timing of future events. When considering forward-looking
statements, you should keep in mind the risk factors and other cautionary
statements in this report.




General




Organization





Emerging
Media Holdings, Inc was incorporated in the State of Nevada on September 3,
2003. The Company directs its operations through its subsidiaries, IM “Media
Alianta” SRL  (formerly SC “Cabavarum” SRL), SA “Analytic Media
Group”, ("AMG"), ICS “Media Top Prim SRL”, ICS “Alkasar Media Services SRL” and
SC Genesis International SA, a joint stock company incorporated under the laws
of Romania (“Genesis”). All subsidiaries' operations and assets are located in
the Republic of Moldova, other than those of Genesis which are located in
Romania. Through its Moldova subsidiaries, the Company's primary activities are
in radio and television broadcasting and through Genesis, road construction in
Romania. The Company earns its revenue primarily through advertisement sales
revenues and from road construction contracts.





Basis
of Presentation





Throughout
this Form 10-Q, the terms "we," "us," "our," "EMH" and "Company" refer to
Emerging Media Holdings, Inc., a Nevada corporation, and, unless the context
indicates otherwise, includes our subsidiaries.





Recent
Developments





On
October 1, 2009, we closed an acquisition of 60% of the outstanding shares of
Genesis, which has as its principal business the construction of roads and
highways in Romania, from IPA International Project Agency Establishment, a
Lichtenstein corporation (“IPA”), pursuant to a Share Purchase Agreement (the
“Agreement”), executed as of June 10, 2009, by and between the Company and
Genesis. On November 7, 2008, the Company had entered into a loan agreement with
IPA, and the Company had advanced IPA $3,840,000. In June 2009, IPA assumed the
debt owed by a Romanian entity to the Company in the amount of $253,740 in
connection with a terminated acquisition agreement. As of September 30, 2009,
IPA owed the Company $4,093,740 plus interest of $146,757. On October 1, 2009,
the Company closed the acquisition of 60% of the outstanding shares of Genesis
International owned by IPA for $4,800,000, and the outstanding note receivable
was applied against the purchase price. Effective February 23, 2010, we acquired
an additional 20% of the outstanding shares of Genesis, in exchange for
1,250,000 shares of our common stock.




Critical
Accounting Policies and Estimates




Our
significant accounting policies are more fully described in Note 1 of Notes to
the Consolidated Financial Statements.  However, certain accounting
policies and estimates are particularly important to the understanding of the
our financial position and results of operations and require the application of
significant judgment by our management or can be materially affected by changes
from period to period in economic factors or conditions that are outside the
control of management.  As a result they are subject to an inherent
degree of uncertainty. In applying these policies, our management uses their
judgment to determine the appropriate assumptions to be used in the
determination of certain estimates. Those estimates are based on our historical
operations, our future business plans and projected financial results, the terms
of existing contracts, our observance of trends in the industry, information
provided by our customers and information available from other outside sources,
as appropriate.





The
Company believes the following critical accounting policies affect its more
significant judgments and estimates used in the preparation of its consolidated
financial statements.





13





Allowance
for Doubtful Accounts





The
Company maintains allowances for doubtful accounts for estimated losses from the
inability of its customers to make required payments.  The Company
determines its reserves by both specific identification of customer accounts
where appropriate and the application of historical loss experience to
non-specific accounts.  If the financial condition of the Company’s
customers were to deteriorate, resulting in an impairment of their ability to
make payments, additional allowances could possibly be required.





Revenue
Recognition





The
Company recognizes revenue in accordance with the guidance in ASC 605, "Revenue
Recognition".   Revenue from advertisement sales is recognized on
a contract basis and is earned over the life of the contract as the services for
advertising are performed.





Revenue
from road construction is recognized when the work is completed and accepted by
the purchaser.  The contracts are usually of a short
duration.  If the contracts are longer than one year, the Company
recognizes income on the percentage of completion method.  The Company
is also subject to the risk of currency fluctuations that may affect the prices
paid for goods and the amounts received for revenue.





Income
Taxes





Income
taxes are accounted for under ASC 740, "Income Taxes".  In accordance
with ASC 740, liabilities are recognized for the future tax consequences
attributable to differences between the financial statement carrying amounts of
existing assets and liabilities and their respective tax bases, as measured by
enacted tax rates that are expected to be in effect in the periods when the
deferred tax assets and liabilities are expected to be settled or
realized.  Significant judgment is required in determining the
worldwide provisions for income taxes.  In the ordinary course of a
global business, the ultimate tax outcome is uncertain for many
transactions.  It is the Company’s policy to establish provisions for
taxes that may become payable in future years as a result of an examination by
tax authorities.  The Company establishes the provisions based upon
management’s assessment of exposure associated with permanent tax differences
and tax credits applied to temporary difference adjustments.  The tax
provisions are analyzed periodically (at least quarterly) and adjustments are
made as events occur that warrant adjustments to those provisions.





Variable Interest
Entities





The
Company consolidates variable interest entities ("VIE") of which the Company is
the primary beneficiary. The liabilities recognized as a result of consolidating
these VIEs do not necessarily represent additional claims on the Company's
general assets; rather, they represent claims against the specific assets of the
consolidated VIEs.   Conversely, assets recognized as a result of
consolidating these VIEs do not represent additional assets that could be used
to satisfy claims against the Company's general assets.





Business
Combinations





During
2009, the Company adopted the revised accounting guidance related to business
combinations. This guidance requires an acquirer to recognize the assets
acquired, the liabilities assumed, and any noncontrolling interest in the
acquiree at the acquisition date, measured at their fair values as of that date,
with limited exceptions specified in the literature.  In accordance
with this guidance, acquisition-related costs, including restructuring
costs,  must be recognized separately from the acquisition and will
generally be expensed as incurred.  That replaces the cost-allocation
process detailed in previous accounting literature, which required the cost of
an acquisition to be allocated to the individual assets acquired and liabilities
assumed based on their estimated fair values.





Foreign
currency accounting





The
financial position and results of operations of our foreign subsidiaries in the
Republic of Moldova and Romania are measured using the foreign subsidiaries’
local currencies, the Moldovan and Romanian lei and the euro, as the functional
currencies since those are the currency of the primary environment in which
those companies generate their revenues and expenses.  Revenues and
expenses of such subsidiaries are translated into U.S. dollars at average
exchange rates prevailing during the period. Assets and liabilities are
translated at the rates of exchange on the balance sheet date. The resulting
translation gain and loss adjustments are recorded directly as a separate
component of shareholders’ equity. The amount of future translation gains or
losses will be affected by any changes in the exchange rate between the lei and
the U.S. dollar.





14





Although
our Moldovan and Romanian subsidiaries incur most of their expenses in the lei
and euro, many of their sales are to customers outside of Moldova and are
therefore denominated in currencies other than the lei or euro (principally the
U.S. dollar).  Additionally, our Moldova subsidiaries have certain
bank loans that are denominated in U.S. dollars, and make certain purchases that
are denominated in U.S. dollars.  As required by ASC 830-10-15,
"Foreign Currency Matters", at the time of such a U.S dollar denominated
transaction the subsidiary records the revenue and related receivable, or the
bank debt or other liability, in lei on the basis of the exchange rate in effect
on the date of the transaction.  However, if the exchange rate between
the lei and the currency in which the transaction is denominated changes between
the date of the original transaction and the date the resulting receivable is
collected or liability is paid, the amount received or paid, when converted to
lei, will be different than the receivable or liability originally recorded,
resulting in a foreign currency transaction gain or loss which is recorded in
the results of operations.  Additionally, at the end of each reporting
period the lei and euro amounts for the receivables, bank debts and accounts
payable of our Moldova and Romanian subsidiaries that are denominated in U.S.
dollars are adjusted to reflect the amount in lei or euros expected to be
received or paid when the receivable is collected or the liability settled on
the basis of the exchange rate at the end of the period. These adjustments also
produce foreign currency transaction gains or losses which are recorded in the
results of operations.





As a
result, in periods in which the value of the lei and euro increases against the
value of the U.S. dollar, we will recognize a net foreign currency transaction
gain if our Moldova and Romanian subsidiaries have U.S. dollar denominated
liabilities that exceed their U.S. dollar denominated receivables, or we will
incur a net foreign currency transaction loss if our Moldova and Romanian
subsidiaries have U.S. dollar denominated receivables that exceed their U.S.
dollar denominated liabilities. Conversely, in periods in which the value of the
lei and euro declines against the value of the U.S. dollar, we will incur a net
foreign currency transaction loss if our Moldova and Romanian subsidiaries have
U.S. dollar denominated liabilities that exceed their U.S. dollar denominated
receivables, or we will recognize a net foreign currency transaction gain if our
Moldova and Romanian subsidiaries have U.S. dollar denominated receivables that
exceed their U.S. dollar denominated liabilities.




The
amount of these gains or losses will depend on the amount, if any, by which the
U.S. dollar denominated receivables of our Moldova and Romanian subsidiaries
exceed their U.S. dollar denominated liabilities, or vice versa, and the amount,
if any, by which the value of the lei and euro changes against the value of the
U.S. dollar. We cannot predict the amount, if any, by which the lei and euro
will increase or decrease in value against the U.S. dollar. Additionally, the
amount of the U.S. dollar denominated receivables and liabilities of our Moldova
and Romanian subsidiaries will vary from period to period.





Results
of Operations





Year
Ended December 31, 2009 Compared to Year Ended December 31, 2008





REVENUES.  Total
revenues for 2009 were $4,228,497, reflecting the inclusion of revenues
attributable to the operations of Genesis of $2,170,355 for the period October 1
through December 31, 2009.  The net revenues attributable to media
operations in 2009 amounted to $2,058,142, an increase from net revenue of
$1,872,892 in 2008. Overall growth was primarily driven by the performance of
the advertising business of the TV channel TNT and our continued strategy of
developing services at TV7.





COST OF
SALES. Cost of Sales for the construction business of Genesis for the three
month period ended December 31, 2009 were $1,760,709. For media operations, Cost
of Sales increased by $119,861 or 11.8% to $1,132,578 for the fiscal year ending
December 31, 2009, from $1,012,717 for the fiscal year ended December 31,
2008.  This increase was primarily due to increased sales as a result
of growth of the Company’s market share. We experienced a further decrease of
gross margin during 2009 due to our increasing focus on the production of high
quality broadcasting, which required purchases of more expensive
services.





SELLING
AND ADMINISTRATIVE EXPENSES.  Selling and administrative expenses for
Genesis were $286,574 for the three months ended December 31,
2009.  Selling and administrative expenses for our media operations
increased by $155,736 or 17.4% to $1,056,042 for the fiscal year ending December
31, 2009 from $899,306 for the fiscal year ended December 31,
2008.  This increase was primarily due to the increase in payroll
expenses relating to our recently established advertising joint
venture.





LOSS FROM
OPERATIONS.  As a result of the launch of the new project, loss from
media operations for the fiscal year ended December 31, 2009 increased by
$195,531 as compared to a loss of $39,131 for the fiscal year ended December 31,
2008. For Genesis, Income from Operations for the fourth quarter of 2009 was
$227,256.





OTHER
ITEMS. The net gain from sale of fixed assets was $3,510 for the fiscal year
ended December 31, 2009, as compared to net loss from sale of fixed assets was
$20,147 for the fiscal year ended December 31, 2008. Other income was $170,909
for the fiscal year ended December 31, 2009 and $114,448 for the fiscal year
ended December 31, 2008.  The increase was due to interest earned on
our excess cash. Included in other income in 2009 was $14,911, attributable to
the operations of Genesis for the fourth quarter of 2009.





15





INTEREST
EXPENSE. Interest expense was $9,392 for the fiscal year ended December 31, 2009
as compared to $4,706 for the fiscal year ended December 31, 2008. This increase
is primarily due to interest incurred from the Genesis operations during the
fourth quarter of 2009.




NET
EARNINGS. Net earnings decreased by $22,761 to $27,963 for the fiscal year ended
December 31, 2009, from net earnings of $50,724 for the fiscal year ended
December 31, 2008.  This decrease was due to increased expenses from
our Media sector and higher interest costs from Genesis offset by the gross
profit generated by Genesis.  Net earnings for Genesis for the fourth
quarter of 2009 was $143,768.




LIQUIDITY
AND CAPITAL RESOURCES





Media
Operations





During
2009, the Company's revenues have begun to increase to approach levels that are
comparable to 2005 levels. The Company's main strategic goal is to expand
the business in neighboring East European countries, primarily
Romania, Ukraine
and Russia.





The
Company can grow using its internally-generated funds, and it is anticipated that the
current projections can be achieved without any external capital infusion.
However, since Moldovan as well as Ukrainian and Romanian television markets
are still in their development stages with the overall growth rate well above
comparable growth rates in the "matured" markets, there are small/medium-sized
companies that are severely undercapitalized, and thus operate
with a high degree of inefficiency. With the additional capital, the Company
can implement two core strategies:





-    Increase
shareholders' value by capitalizing on private-to-public arbitrage opportunities
and purchasing "revenues" via acquisitions of private undercapitalized
businesses and applying economies of scale.





-    Increase
shareholders' value by growing the Company's core business internally
by investing in its own equipment and production, thus increasing
production capacity and competitiveness.





We
believe that both strategies could significantly accelerate the Company's
internal growth, while improving its operating cash flow. We intend to purchase
operating businesses by spending on average $1 of capital for $1 of revenues
of acquired operating business, thus, in effect purchasing operating business
(after the application of the economies of scale arbitrage) at an approximate
P/E ratio of 4. There is no assurance that we will be able successfully
to make any such acquisition or acquisitions.





The
balance of any excess cash balances will be reinvested on a short-term basis.
The market value of long-term investments did not change as the investments were
fixed yield bonds with a fixed price and fixed interest rate. There is no
secondary market for the fixed yield bonds in the Republic of Moldova, thus the
face value of the investments must match the market value at all
times.





The
Company plans to acquire equipment to produce the broadcast programs (for studios,
for breaking news mobile systems, etc); as such, this acquisition and the
uplink services might present significant impact on our liquidity and capital
resources of the company. The Company believes the cash flows from operations
will be sufficient to fund the purchases of this equipment.





The
Company plans to acquire equipment to produce the broadcast programs (for
studios, for breaking news mobile systems, etc); as such, this acquisition and
the uplink services might present significant impact on our liquidity and
capital resources of the company. The Company believes the cash flows from
operations will be sufficient to fund the purchases of this
equipment.





Genesis




Genesis
finances its business primarily through operations.  Genesis has a
line of credit of approximately $1.2 million, which was primarily used as of
December 31, 2009.  Genesis plans to seek additional financing in 2010
on a project to project basis to meet the demands of new contracts entered into
during the latter part of 2009 and early 2010.





16




On May 2,
2008, the Company acquired the common stock of “TNT-Bravo” channel (ICS “Media
Top Prim” SRL), the exclusive operator in Moldova of Russian channel TNT
programs owned by Gazprom Media, a wholly-owned subsidiary of the GazProm
Corporation.  The acquisition was valued at $4.0 million and the
Company issued 1 million shares of common stock to complete the
acquisition.The
acquisition has been accounted for using the purchase method of accounting, and
accordingly, the results of operations of ICS “Media Top Prim” SRL are included
in the Company’s consolidated financial statements from May 2,
2008.





On May 2,
2008, the Company entered into a subscription agreement with a private investor
for an equity investment of $5,000,000 in the Company through the purchase by
the investor of 1,250,000 shares of the Company’s common stock.





On
November 7, 2008, the Company entered into a loan agreement with IPA
International Project Establishment, a Lichtenstein corporation
(“IPA”).  The Company advanced IPA $3,840,000.  In June
2009, IPA assumed the debt owed by a Romanian entity to the Company in the
amount of $253,740 in connection with a terminated acquisition
agreement.    The term of the loan was originally for six
months with interest at a rate of 5% per anum payable at
maturity.  The loan had been extended to October 2009.  On
October 1, 2009, the Company consummated an acquisition of 60% of the
outstanding shares of SC Genesis International S.A. owned by IPA.  The
outstanding note receivable, including interest of $186,758, in the amount of
$4,280,498 was applied against the purchase price.  See Note 2 for
further information.  For the year ended December 31, 2009 and 2008,
the Company recorded interest income of $146,757 and $40,001,
respectively.





In June
2009, the Company entered into a loan agreement with SC Genesis International
SA.  The Company advanced SC Genesis International SA
$500,000.  Subsequent to the acquisition of Genesis, the note
receivable is an intercompany transaction.  See Note 1, Principles of
Consolidation.  For the year ended December 31, 2009, the Company
received interest income of $19,422.





In
October 2009, the Company consummated an acquisition of 60% of the outstanding
shares of SC Genesis International S.A. owned by IPA International Project
Establishment. The consideration paid by the Company for the acquisition of
Genesis was approximately $4,800,000.  The acquisition has been
accounted for using the purchase method of accounting, and accordingly, the
results of operations of Genesis are included in the consolidated financial
statements from October 1, 2009.




During
2009, the Company has funded its capital requirements for media operations
primarily through operating activities.  As of December 31, 2009 the
Company had a cash balance of $648,000. This compares with a cash balance of
$1,334,000 at December 31, 2008. The Company expects cash flow from operations
to fund the Company’s media operating activities for the next twelve
months.  Genesis funded its operating activities through its
operations and its existing line of credit of approximately $1.2
million.  Genesis is seeking additional funding to finance its
growth.





The
Company had a working capital deficiency of approximately $220,000 and a
stockholders’ equity of approximately $9.3 million as of December 31,
2009.  Cash and cash equivalents decreased approximately $687,000 for
the year ended December 31, 2009.  The decrease is primarily
attributable to the purchase of property, plant and equipment of $115,000,
purchase of marketable securities of $78,000 and, the repayment of debt of $1.6
million offset by cash provided by operating activities of approximately $1.1
million.





Accounts
receivable, net of allowances, were $3.6 million at December 31, 2009, as
compared to $263,000 at December 31, 2008.  The increase is primarily
due to increased sales during the year ended December 31, 2009, and the
acquisition of Genesis and consolidation of its accounts receivable of $6.2
million.  Property, plant and equipment, net, were $2.9 million at
December 31, 2009, as compared to $109,000 at December 31, 2008, principally due
to the purchase of Genesis and consolidation of its property, plant and
equipment, net, of $3.1 million, and of $115,000 of property, plant and
equipment purchased for media operations during the year ended December 31,
2009.  Accounts payable were $3.8 million at December 31, 2009, as
compared to $88,000 at December 31, 2008. The increase is primarily due to
additional expenses during the year ended December 31, 2009, and the acquisition
of Genesis and consolidation of its accounts payable of $5.2
million.








Off
Balance Sheet Arrangements





We do not
currently have any off balance sheet arrangements falling within the definition
of Item 303(c) of Regulation S-B.




Inflation





To date
inflation has not had a material impact on our operations.





17




New
Financial Accounting Standards





New Financial Accounting
Standards





During
2009, the Company adopted the revised accounting guidance related to business
combinations.  This guidance requires an acquirer to recognize the
assets acquired, the liabilities assumed, and any noncontrolling interest in the
acquiree at the acquisition date, measured at their fair values as of that date,
with limited exceptions specified in the literature.  In accordance
with this guidance, acquisition-related costs, including restructuring costs,
must be recognized separately from the acquisition and will generally be
expensed as incurred.  That replaces the cost-allocation process
detailed in previous accounting literature, which required the cost of an
acquisition to be allocated to the individual assets acquired and liabilities
assumed based on their estimated fair values.  The Company implemented
this new guidance effective January 1, 2009.





During
2009, the Company implemented an update to the accounting guidance related to
earnings per share.  In accordance with this accounting guidance,
unvested share-based payment awards with rights to dividends are participating
securities and shall be included in the computation of basic earnings per
share.  The Company adopted this guidance effective January 1,
2009.  This implementation did not have a material impact on prior
periods presented.





The FASB
has published a update to the accounting guidance on fair value measurements and
disclosures as it relates to investments in certain entities that calculate net
asset value per share (or its equivalent).  This accounting guidance
permits a reporting entity to measure the fair value of certain investments on
the basis of the net asset value per share of the investment (or its
equivalent).  This update also requires new disclosures, by major
category of investments, about the attributes of investments included within the
scope of this amendment to the Codification.  The guidance in this
update is effective for interim and annual periods ending after December 15,
2009.  The Company does not expect the adoption of this standard to
have a material impact on the Company's results of operations, financial
condition or cash flows.




Item
7A. Quantitative and Qualitative Disclosures About Market Risk.




Interest
Rate and Investment Risk - Interest rate risk refers to fluctuations in the
value of a security resulting from changes in the general level of interest
rates. Investments that are classified as cash and cash equivalents have
original maturities of three months or less. Our interest income is sensitive to
changes in the general level of  interest rates.  Due to the
short-term nature of our investments, we believe that there is not a material
risk exposure. The Company's cash and cash equivalents are concentrated
primarily in four banks in Moldova and several banks in Romania.  At
times, such deposits could be in excess of insured limits.  Management
believes that the financial institutions that hold the Company’s financial
instruments are financially sound and, accordingly, minimal investment risk is
believed to exist with respect to these financial instruments




Credit
Risk - Our accounts receivables are subject, in the normal course of business,
to collection risks. We regularly assess these risks and have established
policies and business practices to protect against the adverse effects of
collection risks. Accounts receivable are reviewed daily and credit is given
after the review of the Company’s credit policies.  As a result we do
not anticipate any material losses in this area.




Foreign
Exchange Risk - The financial position and results of operations of our foreign
subsidiaries in the Republic of Moldova and Romania are measured using the
foreign subsidiaries’ local currencies, the Moldovan and Romanian lei and the
euro, as the functional currency since that is the currency of the primary
environment in which those companies generate their revenues and
expenses.  Revenues and expenses of such subsidiaries are translated
into U.S. dollars at average exchange rates prevailing during the period. Assets
and liabilities are translated at the rates of exchange on the balance sheet
date. The resulting translation gain and loss adjustments are recorded directly
as a separate component of shareholders’ equity. The amount of future
translation gains or losses will be affected by any changes in the exchange rate
between these local operating currencies and the U.S. dollar.




18




Item
8. Financial Statements and Supplementary Data.













EMERGING
MEDIA HOLDINGS, INC.


CONSOLIDATED
FINANCIAL STATEMENTS


December
31, 2009 and 2008










19




EMERGING
MEDIA HOLDINGS, INC. AND SUBSIDIARIES





INDEX TO
CONSOLIDATED FINANCIAL STATEMENTS




PageConsolidated
      Financial StatementsReports of
      Independent Registered Pubic Accounting Firms
            21-22Consolidated Balance
      Sheets as of December 31, 2009 and 2008
            23Consolidated
      Statements of Operations for the Years Ended December 31,
2009
              and
      2008
            24Consolidated
      Statements of Comprehensive Income for the Years Ended
              December
      31, 2009 and 2008
            25Consolidated
      Statement of Equity for Each of the Two Years
              in
      the Period Ended December 31, 2009
            26Consolidated
      Statements of Cash Flows for the Years Ended December 31,
2009
              and
      2008
            27-28Notes to the
      Consolidated Financial
      Statements.
            29-49








20





REPORT OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM





Board of
Directors


Emerging
Media Holdings Inc.


Chisinau,
Moldova





We have
audited the accompanying consolidated balance sheet of Emerging Media Holdings
Inc. (collectively,
the “Company”) as of December 31, 2009, and the related consolidated statements
of operations, equity and cash flows for the year ended.  These
financial statements are the responsibility of the Company’s
management.  Our responsibility is to express an opinion on these
financial statements based on our audit.  The financial statements of
Emerging Media Holdings, Inc. as of December 31, 2008, were audited by other
auditors whose report, dated March 31, 2009, expressed an unqualified opinion on
those statements.





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





As
discussed in Note 1 of Notes to Consolidated Financial Statements, approximately
93% of the consolidated assets are located in Moldova and Romania and 100% of
the consolidated revenue is earned in Moldova and Romania.





In our
opinion, the 2009 financial statements present fairly, in all material respects,
the financial position of the Company as of December 31, 2009, and the results
of its operations and its cash flows for the year then ended, in conformity with
accounting principles generally accepted in the United States of
America.

















/s/
Madsen & Associates CPA’s,
Inc










March 29,
2010




21





REPORT OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM





Board of
Directors


Emerging
Media Holdings Inc.


Chisinau,
Moldova





We have
audited the accompanying consolidated balance sheets of Emerging Media Holdings
Inc. (collectively, the “Company”) as of December 31, 2008 and 2007, and the
related consolidated statements of operations, stockholders’ equity and cash
flows for each of two years in the period ended December 31,
2008.  These financial statements are the responsibility of the
Company’s management.  Our responsibility is to express an opinion on
these financial statements based on our audits.





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





As
discussed in Note 1 of Notes to Consolidated Financial Statements, 100% of the
consolidated assets are located in Moldova and approximately 99% of the
consolidated revenue is earned in Moldova.





In our
opinion, such consolidated financial statements present fairly, in all material
respects, the financial position of the Company as of December 31, 2008 and
2007, and the results of its operations and its cash flows for each of the two
years in the period ended December 31, 2008, in conformity with accounting
principles generally accepted in the United States of America.

















/s/
Wiener, Goodman & Company, P.C.


Eatontown,
New Jersey





March 31,
2009




22




EMERGING
      MEDIA HOLDINGS INC. AND SUBSIDIARIESCONSOLIDATED
      BALANCE SHEETSASSETSDecember
      31,2009
            
            
            2008CURRENT
      ASSETS:Cash
      and cash equivalents
            
            $
            647,861
            
            
            $
            1,334,738Marketable
      securities
            
            
            328,801
            
            
            
            250,000Notes
      receivable
            
            
            -
            
            
            
            3,840,000Accounts
      receivable - net of allowance for doubtful accounts of
      $246,000and
      $-0-
            
            
            3,578,358
            
            
            
            262,889Inventories
            
            
            308,732
            
            
            
            5,728Employee
      receivables and other current assets
            
            
            169,544
            
            
            
            458,024Total
      Current Assets
            
            
            5,033,296
            
            
            
            6,151,379Property,
      plant and equipment, net
            
            
            2,893,835
            
            
            
            109,026Restricted
      cash
            
            
            720,888
            
            
            
            -Intangible
      assets – net
            
            
            258,041
            
            
            
            314,857Goodwill
            
            
            7,510,892
            
            
            
            3,639,645TOTAL
      ASSETS
            
            $
            16,416,952
            
            
            $
            0,214,907LIABILITIES
      AND EQUITYCURRENT
      LIABILITIES:Notes
      payable
            
            $
            471,595
            
            
            $
            -Accounts
      payable
            
            
            3,772,888
            
            
            
            87,958Accrued
      expenses
            
            
            374,094
            
            
            
            179,893Capitalized
      lease obligations
            
            
            81,788
            
            
            
            2,967Notes
      payable - related parties
            
            
            -
            
            
            
            47,123Customer
      deposits
            
            
            552,851
            
            
            
            -Total
      Current Liabilities
            
            
            5,253,216
            
            
            
            317,941LONG-TERM
      LIABILITIES:Notes
      payable - less current portion above
            
            
            1,165,087
            
            
            
            -Capitalized
      lease obligations - less current portion above
            
            
            14,038
            
            
            
            6,357Total
      Long-Term Liabilities
            
            
            1,179,125
            
            
            
            6,357TOTAL
      LIABILITIES
            
            
            6,432,341
            
            
            
            324,298Commitments
      and Contingencies
            
            
            -
            
            
            
            -EQUITY:Emerging
      Media Holdings Inc. and Subsidiaries Stockholders' Equity:Preferred
      stock, no par value, 1,000,000 shares to be designated at
      December31,  2008
      - at stated value
            
            
            -
            
            
            
            4,000,000Common
      stock, $.001 par value, 100,000,000 shares authorized;
      17,303,000and
      16,303,000 shares issued at December 31, 2009 and December 31,
      2008
            
            
            17,303
            
            
            
            16,303Additional
      paid-in-capital
            
            
            9,026,003
            
            
            
            5,027,003Retained
      earnings
            
            
            721,510
            
            
            
            693,547Cumulative
      other comprehensive income (loss)
            
            
            (406,856
            )
            
            
            162,993Less:
      Cost of common stock in treasury, 9,800 shares
            
            
            (9,237
            )
            
            
            (9,237
            )Total
      Emerging Media Holdings Inc. and Subsidiaries Stockholders'
      Equity:
            
            
            9,348,723
            
            
            
            9,890,609Noncontrolling
      interest
            
            
            635,888
            
            
            
            -Total
      Equity
            
            
            9,984,611
            
            
            
            9,890,609TOTAL
      LIABILITIES AND EQUITY
            
            $
            16,416,952
            
            
            $
            10,214,907




See Notes
to Consolidated Financial Statements




23




EMERGING MEDIA
      HOLDINGS INC. AND SUBSIDIARIESCONSOLIDATED
      STATEMENTS OF OPERATIONSFor
      the Years EndedDecember
      31,2009
            
            
            2008Revenues
            
            $
            4,228,497
            
            
            $
            1,872,892Costs
      and expenses:Cost
      of sales
            
            
            2,893,287
            
            
            
            1,012,717Selling
      and marketing expenses
            
            
            245,749
            
            
            
            120,565General
      and administrative expenses
            
            
            954,151
            
            
            
            644,477Other
      operating expenses
            
            
            142,716
            
            
            
            134,2644,235,903
            
            
            
            1,912,023Loss
      from operations
            
            
            (7,406
            )
            
            
            (39,131
            )Other
      income (expense):Interest
      expense
            
            
            (90,392
            )
            
            
            (4,706
            )Other
      income (principally interest income)
            
            
            170,909
            
            
            
            114,448Gain
      (loss) on sale of fixed assets
            
            
            3,510
            
            
            
            (20,147
            )84,027
            
            
            
            89,595Earnings
      before provision for income taxes
            
            
            76,621
            
            
            
            50,464Provision
      for income taxes
            
            
            -
            
            
            
            -Net
      earnings
            
            
            76,621
            
            
            
            50,464Less:
      Net earnings (loss) attributable to thenoncontrolling
      interest
            
            
            48,658
            
            
            
            (260
            )Net
      earnings attributable to Emerging Media Holdings Inc.and
      Subsidiaries
            
            $
            27,963
            
            
            $
            50,724Earnings
      per common share:Earnings
      per common share attributable toEmerging
      Media Inc. and Subsidiariescommon
      shareholders – basic
            
            $
            0.00
            
            
            $
            0.00Earnings
      per common share attributable toEmerging
      Media Inc. and Subsidiariescommon
      shareholders – diluted
            
            $
            0.00
            
            
            $
            0.00Weighted
      average common shares - basic
            
            
            17,303,000
            
            
            
            15,814,048Weighted
      average common shares - diluted
            
            
            17,303,000
            
            
            
            16,814,048




See Notes
to Consolidated Financial Statements




24




EMERGING
      MEDIA HOLDINGS INC. AND SUBSIDIARIESCONSOLIDATED
      STATEMENTS OF COMPREHENSIVE INCOMEFOR
      THE YEARS ENDED DECEMBER 31, 2009 AND 2008Years
      EndedDecember
      31,2009
            
            
            2008Net
      earnings
            
            $
            76,621
            
            
            $
            50,464Other
      comprehensive income (loss) - net of tax:Currency
      translation adjustment
            
            
            (569,849
            )
            
            
            47,761Comprehensive
      income (loss)
            
            
            (493,228
            )
            
            
            98,225Comprehensive
      income (loss) attributable to noncontrollingInterest
            
            
            (114,084
            )
            
            
            (260
            )Comprehensive
      income (loss) attributable to EmergingMedia
      Inc. and Subsidiaries
            
            $
            (379,144
            )
            
            $
            98,485




See Notes
to Consolidated Financial Statements




25




EMERGING
      MEDIA HOLDINGS INC. AND SUBSIDIARIESCONSOLIDATED
      STATEMENT OF EQUITYDecember
      31, 2009CumulativePreferred
      Stock
              
              
              Common
      Stock
              
              
              
              
              
              
              
              
              OtherComprehensive
              
              
              Number
      of
              
              
              
              
              
              Number
      of
              
              
              
              
              
              Additional
      Paid
              
              
              Retained
              
              
              Comprehensive
              
              
              Treasury
              
              
              NoncontrollingTotal
              
              
              Income
              
              
              Shares
              
              
              Amount
              
              
              Shares
              
              
              Amount
              
              
              In
      Capital
              
              
              Earnings
              
              
              Income
      (Loss)
              
              
              Stock
              
              
              InterestBalance,
      January 1,
                2008
              
              $
              801,361
              
              
              
              
              
              
              -
              
              
              $
              -
              
              
              
              15,053,000
              
              
              $
              15,053
              
              
              $
              28,253
              
              
              $
              642,823
              
              
              $
              115,232
              
              
              $
              -
              
              
              $
              -Sale
      of common
                stock
              
              
              5,000,000
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              1,250,000
              
              
              
              1,250
              
              
              
              4,998,750Issuance
      of preferred
                stock
              
              
              4,000,000
              
              
              
              
              
              
              1,000,000
              
              
              
              4,000,000Purchase
      of 9,800
                shares
      oftreasury
      stock
              
              
              (9,237
              )
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (9,237
              )Contribution
      fromnoncontrolling
                interest
              
              
              260
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              260Net
      earnings year
                ended December 31,2008
              
              
              50,464
              
              
              $
              50,464
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              50,724
              
              
              
              
              
              
              
              
              
              
              
              (260
              )Currency
      translation
              
              
              47,761
              
              
              
              47,761
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              47,761Comprehensive
                income
              
              
              
              
              
              $
              98,225Balance,
      December 31,     2008
              
              
              9,890,609
              
              
              
              
              
              
              
              1,000,000
              
              
              
              4,000,000
              
              
              
              16,303,000
              
              
              
              16,303
              
              
              
              5,027,003
              
              
              
              693,547
              
              
              
              162,993
              
              
              
              (9,237
              )
              
              
              -Coversion
      of preferred stock
              
              
              -
              
              
              
              
              
              
              
              (1,000,000
              )
              
              
              (4,000,000
              )
              
              
              1,000,000
              
              
              
              1,000
              
              
              
              3,999,000Noncontrolling
                interest
      acquired
              
              
              587,230
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              587,230Net
      earnings year
                ended December 31,2009
              
              
              76,621
              
              
              $
              76,621
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              27,963
              
              
              
              
              
              
              
              
              
              
              
              48,658Currency
      translation
              
              
              (569,849
              )
              
              
              (569,849
              )
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (569,849
              )Comprehensive
                income
      (loss)
              
              
              
              
              
              $
              (493,228
              )Balance,
      December 31, 2009
              
              $
              9,984,611
              
              
              
              
              
              
              
              -
              
              
              $
              -
              
              
              
              17,303,000
              
              
              $
              17,303
              
              
              $
              9,026,003
              
              
              $
              721,510
              
              
              $
              (406,856
              )
              
              $
              (9,237
              )
              
              $
              635,888




See Notes
to Consolidated Financial Statements




26


EMERGING
      MEDIA HOLDINGS INC. AND SUBSIDIARIESCONSOLIDATED
      STATEMENTS OF CASH FLOWSFor
      the Years EndedDecember
      31,2009
              
              
              2008Cash
      flows from operating activities:Net
      earnings
              
              $
              76,621
              
              
              $
              50,464Adjustments
      to reconcile net earnings to net cashprovided
      by operating activities:Depreciation
      and amortization
              
              
              361,201
              
              
              
              121,886(Loss)
      gain on disposition of fixed assets
              
              
              (3,510
              )
              
              
              20,147Changes
      in operating assets and liabilities:Decrease
      in accounts receivable
              
              
              2,129,294
              
              
              
              155,640Decrease
      in inventories
              
              
              268,919
              
              
              
              4,814(Increase)
      decrease in employee receivables and othercurrent
      assets
              
              
              191,259
              
              
              
              (58,613
              )Decrease
      in restricted cash
              
              
              129,739
              
              
              
              -Increase
      (decrease) in accounts payable,accrued
      liabilities and income taxes payable
              
              
              (1,997,246
              )
              
              
              103,049Decrease
      in customer deposits
              
              
              (45,731
              )
              
              
              -Net
      Cash Provided by OperatingActivities
              
              
              1,110,546
              
              
              
              397,387Cash
      flows from investing activities:Deposit
      on acquisition
              
              
              -
              
              
              
              (253,790
              )Purchase
      of property, plant and equipment
              
              
              (115,135
              )
              
              
              (54,247
              )Proceeds
      from sale of fixed assets
              
              
              5,696
              
              
              
              419Purchase
      of marketable securities
              
              
              (78,801
              )
              
              
              -Purchase
      of treasury stock
              
              
              -
              
              
              
              (9,237
              )Advances
      to employees
              
              
              (7,723
              )
              
              
              -Repayment
      of loans by employees
              
              
              6,285
              
              
              
              9,377Advances
      on note receivable
              
              
              -
              
              
              
              (3,840,000
              )Net
      Cash Used In Investing Activities
              
              
              (189,678
              )
              
              
              (4,147,478
              )Cash
      flows from financing activities:Proceeds
      from sale of common stock
              
              
              -
              
              
              
              5,000,000Repayment
      of debt - related parties
              
              
              (47,123
              )
              
              
              (118,920
              )Repayment
      of debt
              
              
              (1,574,841
              )
              
              
              (3,454
              )Cash
      received upon acquisition
              
              
              47,511
              
              
              
              11,662Net
      Cash Provided by (Used In) Financing Activities
              
              
              (1,574,453
              )
              
              
              4,889,288Effect
      of exchange rate changes on cash
              
              
              (33,292
              )
              
              
              15,728Net
      Increase (decrease) in cash
              
              
              (686,877
              )
              
              
              1,154,925Cash
      - Beginning of period
              
              
              1,334,738
              
              
              
              179,813Cash
      - End of period
              
              $
              647,861
              
              
              $
              1,334,738




See Notes
to Consolidated Financial Statements




27


EMERGING
      MEDIA HOLDINGS INC. AND SUBSIDIARIESCONSOLIDATED
      STATEMENTS OF CASH FLOWS (continued)For
      the Years EndedDecember
      31,2009
              
              
              2008Supplemental
      disclosure cash flow information:Cash
      paid for interest
              
              $
              90,392
              
              
              $
              4,206Cash
      paid for income taxes
              
              $
              -
              
              
              $
              -Supplementary
      information:Non-cash
      transactions during the period for:Assumption
      of deposit receivablefrom
      terminated acquisition bynoteholder
              
              $
              253,790Acquisition
      in which liabilitieswere
      assumed:Fair
      value of assets
              
              $
              14,722,687Purchase
      price
              
              
              4,752,093Liabilities
      assumed
              
              $
              9,970,594Exchange
      of note receivable toseller
      in connection with purchaseof
      Genesis
              
              $
              4,280,498




See Notes
to Consolidated Financial Statements




28




EMERGING
MEDIA HOLDINGS INC. AND SUBSIDIARIES


NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS


AS OF AND
FOR YEARS ENDED DECEMBER 31, 2009 AND 2008








1.           DESCRIPTION
OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES





Organization





Emerging
Media Holdings, Inc. (the "Company" or "EMH") was incorporated in the State of
Nevada on September 3, 2003.  The Company operates in two industries,
each in its own geographic area. The Company directs its operations through its
subsidiaries located in Moldova and Romania.  Through its Moldovan
subsidiaries, the Company's primary activities are in radio and television
broadcasting.  The Company was granted a broadcasting license in 2005
which extends through 2011 and earns revenue primarily through advertisement
sales.  Through its Romanian subsidiary, the Company supplies
infrastructure projects to highways and roads throughout Romania using a road
base material.





Significant
Accounting Policies





Principles of
Consolidation





The
consolidated financial statements of the Company include the Company and its
wholly-owned and majority-owned subsidiaries.  All material
intercompany balances and transactions have been eliminated.  For
those consolidated subsidiaries in which the Company's ownership is less than
100 percent (100%), the outside stockholders' interests are shown as
noncontrolling interest in the Company's consolidated balance
sheet.  The noncontrolling interest of the Company's earnings or loss
is classified as net income or loss attributable to noncontrolling interest in
the consolidated statement of operations.





On July
1, 2009, the Financial Accounting Standards Board ("FASB") established
Accounting Standards Codification ("ASC") as the primary source of authoritative
generally accepted accounting principles ("GAAP") recognized by the FASB to be
applied by nongovernmental entities.  Although the establishment of
the ASC did not change current GAAP, it did change the way we refer to GAAP
throughout this document to reflect the updated referencing
convention.





Variable Interest
Entities





The
Company consolidates variable interest entities ("VIE") of which the Company is
the primary beneficiary. The liabilities recognized as a result of consolidating
these VIEs do not necessarily represent additional claims on the Company's
general assets; rather, they represent claims against the specific assets of the
consolidated VIEs.   Conversely, assets recognized as a result of
consolidating these VIEs do not represent additional assets that could be used
to satisfy claims against the Company's general assets.




Economic and Political
Risks




The
Company faces a number of risks and challenges since some of its operations
are  in the Republic  of  Moldova and one
of  its  primary  markets  is in
Moldova.  The financial statements have been prepared assuming the
Company will continue as a going concern.  49% of the consolidated
revenue is earned in Moldova.  Management cannot presently predict
what future impact the political risk will have on the Company, if any, or how
the political climate in Moldova will affect the Company’s
operations.  Accordingly, events resulting from any change in the
political climate could have a material effect on the Company.





29





EMERGING
MEDIA HOLDINGS INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR YEARS ENDED DECEMBER 31, 2009 AND 2008




Cash and Cash
Equivalents





Cash
equivalents include short-term investments in money market funds with an
original maturity of three months or less when purchased.  At December
31, 2009 and 2008, cash equivalents approximated $184,000 and $815,000,
respectively.





Marketable
Securities





The
Company classifies its fixed income securities as “held-to-maturity”, and
accordingly, are carried at cost, which approximates market value.  In
accordance with FASB ASC 320, "Investments-Debt and Equity Securities" ("ASC
320"), the Company periodically reviews its marketable securities and determines
whether the investments are other-than-temporarily impaired.  If the
investments are deemed to be other-than-temporarily impaired, the investments
are written down to their then current fair market value.  See Note 5
for further discussion regarding these impairment charges.  Realized
gains or losses from the sale of marketable securities are based on the specific
identification method.





Accounts
Receivable





Accounts
receivable are recorded when the work is completed, approved by an independent
third party and accepted by the purchaser.  Accounts receivable are
presented in the balance sheet net of allowance for doubtful
accounts.  Receivables are due in 90 days from the date of the invoice
and each customer is evaluated on their ability to demonstrate a commitment to
pay.  The majority of the revenue is due from various state
governmental agencies.  Receivables are written off when they are
determined to be uncollectible.  For the years ended December 31, 2009
and 2008, the Company recorded bad debt expense of approximately $21,000 and
$87,000, respectively.  The allowance for doubtful accounts is
estimated based on the Company’s historical losses, the existing economic
conditions in the industry, and the financial ability of its
customers.  The Company determined the amount to record as an
allowance for doubtful accounts at December 31, 2009 and 2008 based on a
percentage of the current year write-offs to the total of accounts receivable
outstanding.  The Company also analyzed the days outstanding of
receivables to determine an adequate reserve.  The collectability of
receivables remains strong despite the economic crisis and the Company believes
the amount reserved will be more than sufficient to cover any bad
debts.  The Company will monitor the economic conditions during 2010
to determine if additional reserves are needed.  As of December 31,
2009 and 2008, the Company established a reserve against future doubtful
accounts of approximately $246,000 and $-0-, respectively.





Inventories




Inventories
are stated at the lower of cost or market on average cost basis.





Employee
Receivables





The
Company advances loans to certain employees. Receivables from employees at
December 31, 2009 and 2008 amounted to $79,724 and $93,559, respectively, and
are included in employee receivables and other current assets on the Company’s
consolidated balance sheet.





Depreciation and
Amortization




Property,
plant and equipment are carried at cost less accumulated
depreciation.  The cost of repairs and maintenance is expensed as
incurred; major replacements and improvements are capitalized.  When
assets are retired or disposed of, the cost and accumulated depreciation are
removed from the accounts, and any resulting gains or losses are included in
income in the year of disposition.





30





EMERGING
MEDIA HOLDINGS INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR YEARS ENDED DECEMBER 31, 2009 AND 2008






Leased
property and equipment meeting capital lease criteria are capitalized at the
lower of the present value of the related lease payments or the fair value of
the leased asset at the inception of the lease.  Amortization is
calculated on the straight-line basis over the shorter of the remaining terms of
the leases or the estimated useful lives of the asset.





Depreciation
is provided using the straight-line method over the estimated useful lives of
the assets.  The lives applied are as follows:




Buildings and
      building improvements
            7-30 YearsOffice
      equipment
            3-5 YearsTransportation
      equipment
            7 YearsManufacturing
      equipment
            5-10 Years






Foreign Currency
Translation




The
functional currency for foreign operations is the local currency.  The
US dollar is the reporting currency.  Assets and liabilities of
foreign operations are translated at exchange rates as of the balance sheet date
and income, expense and cash flow items are translated at the average exchange
rate for the applicable period.  Translation adjustments are recorded
in other comprehensive income (loss).





Use of
Estimates





The
preparation of the financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period.  Estimates are used in determining such
items as accruals, depreciable/useful lives, allowance for doubtful accounts,
income taxes, percentage of completion and other reserves.  Actual
results could differ from those estimates.





Revenue
Recognition





The
Company recognizes revenue in accordance with the guidance contained in FASB ASC
605, (Revenue Recognition) ("ASC 605").





Revenue
from advertisement sales is recognized on a contract basis and is earned over
the life of the contract as the services for advertising are
performed.





Revenue
from road construction is recognized when the work is completed and accepted by
the purchaser.  The contracts are usually of a short
duration.  If the contracts are longer than one year, the Company
recognizes income on the percentage of completion method.  The Company
is also subject to the risk of currency fluctuations that may affect the prices
paid for goods and the amounts received for revenue.





31





EMERGING
MEDIA HOLDINGS INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR YEARS ENDED DECEMBER 31, 2009 AND 2008


Business
Combinations





During
2009, the Company adopted the revised accounting guidance related to business
combinations. This guidance requires an acquirer to recognize the assets
acquired, the liabilities assumed, and any noncontrolling interest in the
acquiree at the acquisition date, measured at their fair values as of that date,
with limited exceptions specified in the literature.  In accordance
with this guidance, acquisition-related costs, including restructuring
costs,  must be recognized separately from the acquisition and will
generally be expensed as incurred.  That replaces the cost-allocation
process detailed in previous accounting literature, which required the cost of
an acquisition to be allocated to the individual assets acquired and liabilities
assumed based on their estimated fair values.   The Company
implemented this new guidance effective January 1, 2009 and as a result, a total
of $50,000 in acquisition related costs were charged to selling, general and
administrative expenses during 2009.





Goodwill





Goodwill
is tested for impairment on an annual basis or whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be
recoverable.  The Company tests goodwill for impairment, and has
established December 31 as the annual impairment test date, using a fair value
approach at the reporting unit level.  A reporting unit is an
operating segment or one level below an operating segment for  which
discrete financial information is available and reviewed regularly by
management.  Assets and liabilities of the Company have been assigned
to the reporting units to the extent they are employed in or are considered a
liability related to the operations of the reporting unit and are considered in
determining the fair value of the reporting unit.  The Company has
determined that its reportable operating segments are its reporting
units.





The
goodwill impairment test is a two-step process.  If the fair value of
a reporting unit exceeds its carrying amount, goodwill of the reporting unit is
considered not impaired and the second step of the impairment test is
unnecessary.  If the carrying amount of a reporting unit exceeds its
fair value, the second step of the goodwill impairment test is performed to
measure the amount of impairment loss, if any.  The second step of the
goodwill impairment test compares implied fair value of the reporting unit’s
goodwill (i.e., fair value of the reporting unit less the fair value of the
unit’s assets and liabilities, including identifiable intangible assets) with
the carrying amount of that goodwill.  If the carrying value of
goodwill exceeds its implied fair value, the excess is required to be recorded
as an impairment.  See Note 4 of the consolidated financial
statements.





Evaluation of Long-lived
Assets





The
Company reviews property and equipment for impairment whenever events or changes
in circumstances indicate the carrying value may not be recoverable in
accordance with guidance in FASB ASC 360-15-35, “Impairment or Disposal of
Long-Lived Assets” ("ASC 360-15-35").  If the carrying value of the
long-lived assets exceeds the present value of the related estimated future cash
flows, the asset would be adjusted to its fair value and an impairment loss
would be charged to operations in the period identified.





Income
Taxes




Taxes are
calculated in accordance with taxation principles currently effective in the
Republic of Moldova, the Romanian Republic and the United States of
America.





The
Company accounts for income taxes under the asset and liability method, which
requires the recognition of deferred tax assets and liabilities for the expected
future tax consequences of events that have been included in the financial
statements.  Under this method, deferred tax assets and liabilities
are determined based on the differences between the financial statements and tax
basis of assets and liabilities using enacted tax rates in effect for the year
in which the differences are expected to reverse.  The effect of a
change in tax rates on deferred tax assets and liabilities is recognized in
income in the period that includes the enactment date.





32





EMERGING
MEDIA HOLDINGS INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR YEARS ENDED DECEMBER 31, 2009 AND 2008








The
Company records net deferred tax assets to the extent they believe these assets
will more-likely-than-not be realized.  In making such determination,
the Company considers all available positive and negative evidence, including
future reversals of existing taxable temporary differences, projected future
taxable income, tax planning strategies and recent financial
operations.  In the event the Company was to determine that it would
be able to realize its deferred income tax assets in the future in excess of its
net recorded amount, the Company would make an adjustment to the valuation
allowance which would reduce the provision for income taxes.




Concentration of Credit
Risk





Financial
instruments which potentially subject the Company to concentrations of credit
risk consist principally of cash and accounts receivable.





The
Company's cash and cash equivalents are concentrated primarily in four banks in
Moldova and three banks in Romania.  At times, such deposits could be
in excess of insured limits.  Management believes that the financial
institutions that hold the Company’s financial instruments are financially sound
and, accordingly, minimal credit risk is believed to exist with respect to these
financial instruments.





The
Company grants credit to customers that are based on an evaluation of the
customer's financial condition, without requiring
collateral.  Exposure to losses on receivables is principally
dependent on each customer's financial condition.  The Company
controls its exposure to credit risk through credit
approvals and progressive payments as the work is performed.





The
Company is also subject to the risk of currency fluctuations that may affect the
prices paid for goods and the amounts received for revenue.





Retransmission
Rights





The
Company enters into agreements for the right to retransmit programs from other
television networks.  The terms of the agreements are on an annual
basis and the costs are expensed as a part of cost of sales over the life of the
agreements.




Earnings Per
Share





Basic
earnings per common share are computed by dividing net earnings by the weighted
average number of common shares outstanding during the
period.  Diluted earnings per common share are computed by dividing
net earnings by the weighted average number of common shares and potential
common shares outstanding during the period.  Potential common shares
used in computing diluted earnings per share relate to preferred stock which if
exercised would have a dilutive effect on earnings per share.  For the
years ended December 31, 2009 and 2008, there were -0- and 1,000,000 shares,
respectively, potential common shares outstanding.





The
weighted average shares outstanding used in the computation of basic and diluted
earnings per share are as follows:




33


EMERGING
MEDIA HOLDINGS INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR YEARS ENDED DECEMBER 31, 2009 AND 2008


December
      31,2009
              
              
              2008Basic
              
              
              17,303,000
              
              
              
              15,814,048Potential
      shares
              
              
              -
              
              
              
              1,000,000Fully
      diluted
              
              
              17,303,000
              
              
              
              16,814,048


Advance Payments to
Contractors





Advance
payments to contractors principally include prepayments to subcontractors for
goods and services and which relate to specific projects which are expensed to
cost of sales as the applicable inventory is sold.  The subcontractor
costs are expensed on a specific project to project
basis.    The payment to subcontractors include prepayments
prior to the work commencing, advance payments for raw materials, and
architectural and engineering services prior to the work being submitted to the
authorities.  All projects are reviewed quarterly for impairment
issues.  If any impairment exists, costs will be written down at that
time.  Advance payments to contractors are included in inventory on
the Company’s balance sheet at December 31, 2009.





Fair Value of Financial
Instruments





The
Company adopted FASB ASC 820, Fair Value Measurements and Disclosures (“ASC
820”) on January 1, 2008, for all financial assets and liabilities that are
recognized or disclosed at fair value in the consolidated financial statements
on a recurring basis or on a nonrecurring basis during the reporting period.
While the Company adopted the provisions of ASC 820 for nonfinancial assets and
liabilities that are recognized or disclosed at fair value in the financial
statements on a recurring basis, no such assets or liabilities existed at the
balance sheet date. As permitted by ASC 820, the Company delayed implementation
of this standard for all nonfinancial assets and liabilities recognized or
disclosed at fair value in the financial statements on a nonrecurring basis and
adopted these provisions effective January 1, 2009.




The fair
value is an exit price, representing the price that would be received to sell an
asset or paid to transfer a liability in an orderly transaction between market
participants at the measurement date.  The Company utilizes market
data or assumptions that market participants would use in pricing the asset or
liability.  ASC 820 establishes a three-tier fair value hierarchy,
which prioritizes the inputs used in measuring fair value.  These
tiers include:  Level 1, defined as observable inputs such as quoted
market prices in active markets; Level 2, defined as inputs other than quoted
prices in active markets that are either directly or indirectly observable; and
Level 3, defined as unobservable inputs about which little or no market data
exists, therefore requiring an entity to develop its own
assumptions.




As of
December 31, 2009, the Company held certain financial assets that are measured
at fair value on a recurring basis.  These consisted of cash and cash
equivalents, investments in marketable securities and restricted
cash.  The fair values of the cash and cash equivalents and restricted
cash is determined based on quoted market prices in public markets and is
categorized as Level 1.  The investment in marketable securities is
determined by the Company based on market prices other than quoted prices in
active markets and is categorized as Level 2.  These are also
categorized as held-to-maturity securities.  The Company does not have
any financial assets measured at fair value on a recurring basis as Level 3 and
there were no transfers in or out of Level 2 or Level 3 during the year ended
December 31, 2009.




34





EMERGING
MEDIA HOLDINGS INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR YEARS ENDED DECEMBER 31, 2009 AND 2008







The
following table sets forth by level, within the fair value hierarchy, the
Company’s financial assets accounted for at fair value on a recurring basis as
of December 31, 2009 and 2008.




Assets at Fair Value as of December 31, 2009 and 2008
      UsingQuoted
      Prices in
              
              
              SignificantActive
      Markets
              
              
              Other
              
              
              Significantfor
      Identical
              
              
              Observable
              
              
              ObservableAssets
              
              
              Inputs
              
              
              InputsTotal
              
              
              (Level
      1)
              
              
              (Level
      2)
              
              
              (Level
      2)December
      31, 2009Cash
      and cash equivalents
              
              $
              183,946
              
              
              $
              183,946
              
              
              $
              -
              
              
              $
              -Held-to-maturity
      securities
              
              
              328,801
              
              
              
              -
              
              
              
              -
              
              
              
              328,801Restricted
      cash
              
              
              720,888
              
              
              
              720,888
              
              
              
              -
              
              
              
              -Total
              
              $
              1,233,635
              
              
              $
              904,834
              
              
              $
              -
              
              
              $
              328,801December
      31, 2008Cash
      and cash equivalents
              
              $
              815,165
              
              
              $
              815,165
              
              
              $
              -
              
              
              $
              -Held-to-maturity
      securities
              
              
              250,000
              
              
              
              -
              
              
              
              -
              
              
              
              250,000Restricted
      cash
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -Total
              
              $
              1,065,165
              
              
              $
              815,165
              
              
              $
              -
              
              
              $
              250,000






The
Company has other financial instruments, such as receivables, accounts payable
and other liabilities which have been excluded from the tables
above.  Due to the short-term nature of these instruments, the
carrying value of receivables, accounts payable and other liabilities
approximate their fair values.  The Company did not have any other
financial instruments with the scope of the fair value disclosure requirements
as of December 31, 2009.




Non-financial
assets and liabilities, such as goodwill and long-lived assets, are accounted
for at fair value on a nonrecurring basis.  These items are tested for
impairment upon the occurrence of a triggering event or in the case of goodwill,
on at least an annual basis.  As of December 31, 2009, there was no
impairment to goodwill.  The Company's annual test on its long-lived
assets indicated that the carrying value of its long-lived assets was
recoverable and that no impairment existed as of the testing date.




Reclassification





Effective
January 1, 2009, the Company completed its implementation of FASB ASC 810
"Consolidation" ("ASC 810").  As a result of adopting ASC 810, prior
years balances were reclassified to confirm to current
presentation.





New Financial Accounting
Standards





During
2009, the Company adopted the revised accounting guidance related to business
combinations.  This guidance requires an acquirer to recognize the
assets acquired, the liabilities assumed, and any noncontrolling interest in the
acquiree at the acquisition date, measured at their fair values as of that date,
with limited exceptions specified in the literature.  In accordance
with this guidance, acquisition-related costs, including restructuring costs,
must be recognized separately from the acquisition and will generally be
expensed as incurred.  That replaces the cost-allocation process
detailed in previous accounting literature, which required the cost of an
acquisition to be allocated to the individual assets acquired and liabilities
assumed based on their estimated fair values.  The Company implemented
this new guidance effective January 1, 2009.




35




EMERGING
MEDIA HOLDINGS INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR YEARS ENDED DECEMBER 31, 2009 AND 2008





During
2009, the Company implemented an update to the accounting guidance related to
earnings per share.  In accordance with this accounting guidance,
unvested share-based payment awards with rights to dividends are participating
securities and shall be included in the computation of basic earnings per
share.  The Company adopted this guidance effective January 1,
2009.  This implementation did not have a material impact on prior
periods presented.





The FASB
has published a update to the accounting guidance on fair value measurements and
disclosures as it relates to investments in certain entities that calculate net
asset value per share (or its equivalent).  This accounting guidance
permits a reporting entity to measure the fair value of certain investments on
the basis of the net asset value per share of the investment (or its
equivalent).  This update also requires new disclosures, by major
category of investments, about the attributes of investments included within the
scope of this amendment to the Codification.  The guidance in this
update is effective for interim and annual periods ending after December 15,
2009.  The Company does not expect the adoption of this standard to
have a material impact on the Company's results of operations, financial
condition or cash flows.







1. ACQUISITIONS





a) On
October 1, 2009, the Company consummated an acquisition of 60% of the
outstanding shares of SC Genesis International S.A. ("Genesis") owned by IPA
International Project Establishment.  The consideration paid by the
Company for the acquisition of Genesis was approximately
$4,800,000.





Genesis,
a joint stock company incorporated under the laws of Romania, has as its
principal business, the construction of roads and highways.  Other
secondary activities include surface and underground railway construction, other
special construction projects, relocation services and merchandise
transportation.





The fair
value of the identifiable assets acquired, liabilities assumed, and any
noncontrolling interests in Genesis has been measured as of the date of
acquisition.  The measurement period is the period after the
acquisition date during which time the Company may adjust the provisional
amounts recognized for the business combination.  Goodwill has been
recognized as the excess of the fair value of the consideration transferred over
the fair value of the identifiable assets acquired and the liabilities
assumed.  The Company accounted for acquisition-related costs as
expenses in the periods in which the costs were incurred and the services were
received.




36




EMERGING
MEDIA HOLDINGS INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR YEARS ENDED DECEMBER 31, 2009 AND 2008
  The
following table presents the allocation of the acquisition cost to the assets
acquired and liabilities assumed, based on their fair values.
  At
      October 1, 2009Purchase
      priceExchange
      of note receivable
                
                $
                4,280,498Note
      payable
                
                
                471,595Total
      consideration
                
                
                
                
                
                $
                4,752,093Allocation
      of purchase price:Cash
                
                
                
                
                
                
                47,511Accounts
      receivable
                
                
                
                
                
                
                6,162,295Inventories
                
                
                
                
                
                
                571,823Other
      current assets
                
                
                
                
                
                
                158,007Property,
      plant and equipment
                
                
                
                
                
                
                3,061,537Restricted
      cash
                
                
                
                
                
                
                850,267Goodwill
                
                
                
                
                
                
                3,871,247Total
      Assets Acquired
                
                
                
                
                
                
                14,722,687Notes
      payable - current
                
                
                
                
                
                
                539,011Accounts
      payable
                
                
                
                
                
                
                5,185,742Customer
      advances
                
                
                
                
                
                
                598,582Accrued
      expenses
                
                
                
                
                
                
                343,857Capitalized
      lease obligations
                
                
                
                
                
                
                91,384Notes
      payable - long-term
                
                
                
                
                
                
                2,624,788Non-controlling
      interests
                
                
                
                
                
                
                587,230Total
      Liabilities Assumed
                
                
                
                
                
                $
                9,970,594Net
      Assets Acquired
                
                
                
                
                
                $
                4,752,093





b) On May
2, 2008, the Company acquired the common stock of Media Top Prim S.R.L. (LLC)
(“Media Top Prim”), located in Moldova, for 1 million shares of the Company’s
preferred stock of a class and series to be authorized, valued at $4.0
million.  The preferred shares are convertible into common shares on a
1:1 basis after a holding period of one year.  Media Top Prim’s
primary activities are in radio and television broadcasting.  Media
Top Prim earns its revenues primarily through advertisement
sales.  Media Top Prim was granted a broadcasting license on April 24,
2007 which extends to April 24, 2013.  The purchase price was
allocated to both tangible and intangible assets and liabilities based on
estimated fair values after considering an independent formal
appraisal.





The
acquisitions have been accounted for using the purchase method of accounting,
and accordingly, the results of operations of Media Top Prim and Genesis are
included in the Company’s consolidated financial statements from the date of
their acquisitions.





37


EMERGING
MEDIA HOLDINGS INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR YEARS ENDED DECEMBER 31, 2009 AND 2008







The
following unaudited pro forma summary of results of operations assume Media Top
Prim and Genesis had been acquired as of January 1, 2008:








Years
EndedDecember
    31,2009
            
            
            2008Net
      sales
            
            $
            9,524,304
            
            
            $
            20,296,951Net
      loss
            
            
            (2,455,578
            )
            
            
            (1,891,267
            )Loss per share -diluted
            
            
            (0.14
            )
            
            
            (0.11
            )





The
information above is not necessarily indicative of the results of operations
that would have occurred if the acquisition had been consummated as of January
1, 2008.  Such information should not be construed as a representation
of the future results of operations of the Company.




3. JOINT
VENTURE





In August
2008, the Company announced the creation of a new advertising company, Alkasar
Media Services S.R.L. ("Alkasar")  The Company and Alkasar Region LLC
have agreed to become partners to promote new advertising technologies in
Republic of Moldova in the media buying business, each owning a 50% interest in
the joint venture.





The joint
venture has been funded through the initial share capital from each of the
investors.  If additional capital is needed, the joint venture will
raise the additional capital from contributions in share capital or loans from
the shareholders.  If one shareholder does not want to fund the joint
venture, it is not obligated to invest the money.





The joint
venture shall make annual distributions to the joint venture
partners.  The distribution is up to the discretion of the general
manager of the joint venture within 30 days following the end of the fiscal
year.  The general manager is not allowed to make distributions if it
is for the full payment of the share capital or if the result of the
distribution the assets would be less than the amount of the share
capital.  For the years ended December 31, 2009 and 2008, no
distributions were made.




As of
December 31, 2009, Alkasar had assets of $211,668 and liabilities of
$219,572.




Alkasar
Region LLC is affiliated with Gazprom - Media JSC advertising agency, selling
advertising in more then 80 of the largest Russian cities, such as Moscow, St.
Petersburg and others.





4.
GOODWILL AND INTANGIBLES





Goodwill
represents the excess of the purchase price and related acquisition costs over
the value assigned to the net intangible and other intangible assets with finite
lives acquired in a business acquisition.





Other
intangibles include the value assigned to the license purchased as part of the
acquisition of Media Top Prim. Amounts assigned to these intangibles were
determined by management.  Management considered a number of factors
in determining the allocations, including valuations and independent
appraisals.  Other intangibles are being amortized over 7 years, the
life of the license.  Amortization expense was $56,816 and $33,143,
for the years ended December 31, 2009 and 2008, respectively.




38




EMERGING
MEDIA HOLDINGS INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR YEARS ENDED DECEMBER 31, 2009 AND 2008





The
changes in the carrying value of goodwill for the year ended December 31, 2009
is as follows:







TotalBalance,
      December 31, 2008
              
              $
              3,639,645Acquisition
      of 60% ofSC
      Genesis International, S.A.
              
              
              3,871,247Balance,
      December 31, 2009
              
              $
              7,510,892







Nonfinancial
assets and liabilities, such as goodwill and long-lived assets, are accounted
for at fair value on a non recurring basis.  These items are tested
for impairment upon the occurrence of a triggering event or in the case of
goodwill, on at least an annual basis.




For the
annual goodwill impairment assessment performed in 2009, the Company’s fair
value analysis was supported by a weighting of two generally accepted valuation
approaches, including the income approach and the market approach, as further
described below.  These approaches include numerous assumptions with
respect to future circumstances, such as industry and/or local market conditions
that might directly impact operations in the future, and are therefore
uncertain.  These approaches are utilized to develop a range of fair
values and a weighted average of these approaches is utilized to determine the
best fair value estimate within that range.  As of December 31, 2009,
the Company recorded no impairment to its goodwill.




The
components of intangible assets other than goodwill are as follows:







December
      31, 2009Gross
      Carrying
              
              
              AccumulatedAmount
              
              
              AmortizationLicense
      agreements
              
              $
              348,000
              
              
              $
              89,959






39





EMERGING
MEDIA HOLDINGS INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR YEARS ENDED DECEMBER 31, 2009 AND 2008
   Estimated
amortization expense for intangible assets for the next five years is as
follows:







Year
      Ending
              
              AmortizationDecember
      31,
              
              Expense2010
              
              
              49,7142011
              
              
              49,7142012
              
              
              49,7142013
              
              
              49,7142014
              
              
              49,714




5.
MARKETABLE SECURITIES





At
December 31, 2009 and 2008, marketable securities have a cost and estimated fair
value of $328,801 and $250,000, respectively.  The market value of the
marketable securities did not change as the securities were fixed yield bonds
with a fixed price and fixed interest rate.  The investments are
held-to-maturity and are recorded at cost, which approximates market
value.  The bonds mature in September 2010.




6. NOTES
RECEIVABLE





On
November 7, 2008, the Company entered into a loan agreement with IPA
International Project Establishment, a Lichtenstein corporation
(“IPA”).  The Company advanced IPA $3,840,000.  In June
2009, IPA assumed the debt owed by a Romanian entity to the Company in the
amount of $253,740 in connection with a terminated acquisition
agreement.    The term of the loan was originally for six
months with interest at a rate of 5% per anum payable at
maturity.  The loan had been extended to October 2009.  On
October 1, 2009, the Company consummated an acquisition of 60% of the
outstanding shares of SC Genesis International S.A. owned by IPA.  The
outstanding note receivable, including interest of $186,758, in the amount of
$4,280,498 was applied against the purchase price.  See Note 2 for
further information.  For the year ended December 31, 2009 and 2008,
the Company recorded interest income of $146,757 and $40,001,
respectively.





In June
2009, the Company entered into a loan agreement with SC Genesis International
SA.  The Company advanced SC Genesis International SA
$500,000.  Subsequent to the acquisition of Genesis, the note
receivable is an intercompany transaction.  See Note 1, Principles of
Consolidation.  For the year ended December 31, 2009, the Company
received interest income of $19,422.





7.
INVENTORIES





In
accordance with FASB ASC 360-15-35, "Impairment or Disposal of Long-Lived
Assets", ("ASC 360-15"), the Company records impairment losses on inventory
related to projects under development when events and circumstances indicate
that they may be impaired and the undiscounted cash flows estimated by these
assets are less than their related carrying amounts.  The Company
recorded no impairments for the years ended December 31, 2009 and
2008.




40





EMERGING
MEDIA HOLDINGS INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR YEARS ENDED DECEMBER 31, 2009 AND 2008


As of
December 31, 2009 and 2008, inventory consists of the following:








December
      31,2009
              
              
              2008Raw
      materials
              
              $
              94,315
              
              
              $
              5,728Capitalized
      costs
              
              
              186,249Advance
      payments to contractors
              
              
              28,168
              
              
              
              -$
              308,732
              
              
              $
              5,728


8.
PROPERTY, PLANT AND EQUIPMENT





Property,
plant and equipment, which includes amounts recorded under capital leases,
consisted of the following:





December
      31,2009
              
              
              2008Machinery
      and equipment
              
              $
              3,094,484
              
              
              $
              776,979Transportation
      equipment
              
              
              602,929
              
              
              
              -Building
      and building improvements
              
              
              21,187
              
              
              
              -3,718,600
              
              
              
              776,979Less
      accumulated depreciation
              
              
              824,765
              
              
              
              667,953$
              2,893,835
              
              
              $
              109,026





Depreciation
expense for the years ended December 31, 2009 and 2008 totalled $304,385 and
$88,743, respectively.





9.
RESTRICTED CASH





Restricted
cash are the guarantees for the work performed by the Company.  The
performance guarantees range between 5% and 10% of the contract
price.  The warranty period can be as long as sixty months but amounts
are released on a predetermined schedule.  Restricted cash as of
December 31, 2009 and 2008 amounted to $720,888 and $-0-,
respectively.





10.
            NOTES
      PAYABLE





Notes
payable balance as of December 31, 2009 and 2008 were as follows:




41




EMERGING
MEDIA HOLDINGS INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR YEARS ENDED DECEMBER 31, 2009 AND 2008






December
      31,2009
              
              
              2008Note
      payable to Romanian International Bank,
              
              $
              1,165,087
              
              
              $
              -interest
      @ 20.5%, due February 2011 (1)Note
      payable to IPA, interest @ 5%, due
              
              
              471,595
              
              
              
              -upon
      demand (2)1,636,682
              
              
              
              -Less:
      Current portion
              
              
              471,595
              
              
              
              -$
              1,165,087
              
              
              $
              -


(1)
            The
      note payable is collateralized by equipment owned by the Company with a
      book value of approximately $1.6 million and cash flow of one of the
      Company's current projects.





(2)
            Note
      payable in connection with the acquisition of 60% of
    Genesis.





Interest
expense related to notes payable for the years ended December 31, 2009 and 2008
amounted to $75,499 and $4,285, respectively.





The
following table shows the maturities by year of the total amount of notes
payable at December 31, 2009:





Year
      ending December 31,2010
              
              $
              532,3222011
              
              
              1,165,087$
              1,697,409






42




EMERGING
MEDIA HOLDINGS INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR YEARS ENDED DECEMBER 31, 2009 AND 2008







11. NOTES
PAYABLE – RELATED PARTIES





a)
            In
      November 2007, the Company received an advance of $5,000 from a company in
      which a related party has an equity interest.  The advance was
      repaid in January 2009.  Interest is 10% per annum and for the
      years ended December 31, 2009 and 2008, interest amounted to $-0- and
      $500, respectively.  As of December 31, 2009 and 2008, the
      balance due was $-0- and $5,000,
respectively.





b)
            During
      2008, a related party advanced $42,123 to the Company’s Media Top Prim
      subsidiary. The note is due upon demand.  The note was repaid in
      full during 2009.  As of December 31, 2009 and December 31,
      2008, the amount due the related party was $-0- and $42,123,
      respectively.





12.
CAPITALIZED LEASE OBLIGATIONS





Property
under lease:







December
      31,2009
              
              
              2008Equipment
              
              $
              237,818
              
              
              $
              22,400Less:
      Accumulated depreciation
              
              
              23,526
              
              
              
              7,450$
              214,292
              
              
              $
              14,950






The
following is a schedule of minimum future lease payments required as of December
31, 2009, under capital leases which have an initial or remaining
non-cancellable lease term in excess of one year:





Fiscal
      year ending:2010
              
              $
              98,1222011
              
              
              17,9002012
              
              
              2,3792013
              
              
              -2014
              
              
              -Thereafter
              
              
              -Total
      minimum lease payments
              
              
              118,401Less
      current representing interest
              
              
              22,575Present
      value of net minimumlease
      payment
              
              
              95,826Less
      current obligations
              
              
              81,788Long-term
      obligations
              
              $
              14,038





Interest
expense related to capitalized lease obligations for the years ended
December 31, 2009 and 2008 was $14,893 and $421, respectively.




43




EMERGING
MEDIA HOLDINGS INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR YEARS ENDED DECEMBER 31, 2009 AND 2008






13.
NONCONTROLLING INTEREST





Effective
January 1, 2009, the Company completed its implementation of FASB ASC
810.





The
following table sets forth the noncontrolling interest balance and the changes
to this balance attributable to the third-party interests in Alkasar Media
Services S.R.L. and SC Genesis International S.A.





December
      31,2009
              
              
              2008Balance
      at beginning of period
              
              $
              -
              
              
              $
              -Capital
      contributions
              
              
              -
              
              
              
              260Noncontrolling
      interest from the acquisition ofGenesis
      International S.A.
              
              
              587,230
              
              
              
              -Noncontrolling
      interest share of income (loss)
              
              
              48,658
              
              
              
              (260
              )Balance
      at end of period
              
              $
              635,888
              
              
              $
              -


The loss
for 2008 exceeds the capital of the third party.  Losses are only
allocable to the extent of capital.  Any excess losses are absorbed by
the Company.  In future periods, net income will be allocated to
previous unallocated losses before being allocated to third party
interests.





14.
INCOME TAXES





The
Company adopted the provisions of ASC 740 on January 1, 2007.  As a
result of the implementation of ASC 740, the Company recognized no adjustment in
the net liability for unrecognized income tax benefits.  The Company
believes there are no potential uncertain tax positions and all tax returns are
correct as filed.  Should the Company recognize a liability for
uncertain tax positions, the Company will separately recognize the liability for
uncertain tax positions on its balance sheet.  Included in any
liability for uncertain tax positions, the Company will also setup a liability
for interest and penalties.  The Company’s policy is to recognize
interest and penalties related to uncertain tax positions as a component of the
current provision for income taxes.





The
nominal statutory corporate rate in the Republic of Moldova is 0% for 2009 and
2008.   Taxes are calculated in accordance with Moldovan
regulations and are paid annually.   Taxes are calculated on a
separate entity basis since consolidation for tax purposes is not permitted in
Moldova.  The nominal statutory tax rate in the Romanian Republic is
25%.  Taxes are calculated in accordance with Romanian regulations and
are paid annually.  There is no U.S. tax provision due to losses
during both 2009 and 2008.  Deferred income taxes are provided for the
temporary differences between the financial reporting and tax basis of the
Company's assets and liabilities. The principal item giving rise to deferred
taxes is the net operating loss carryforward in the U.S.  Valuation
allowances are established when necessary to reduce deferred tax assets to the
amount expected to be realized.  The Company has set up a valuation
allowance for losses for certain carryforwards that it believes may not be
realized.




44




EMERGING
MEDIA HOLDINGS INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR YEARS ENDED DECEMBER 31, 2009 AND 2008







The
provision for income taxes consist of the following:




Years
      EndedDecember
      31,2009
            
            
            2008Current:Federal
            
            $
            -
            
            
            $
            -Foreign
            
            
            -
            
            
            
            --
            
            
            
            -Deferred:Federal
            
            
            -
            
            
            
            -Foreign
            
            
            -
            
            
            
            --
            
            
            
            -$
            -
            
            
            $
            -




A
reconciliation of taxes on income computed at the federal statutory rate to
amounts provided is as follows:
  Years
      EndedDecember
      31,2009
                  
                  
                  2008Tax
      provision (benefit) computed atthe
      federal statutory rate of 34%
                  
                  $
                  26,051
                  
                  
                  $
                  17,246Increase
      (decrease) in taxes resulting from:Different
      tax rates and permanent differencesapplicable
      to foreign operations
                  
                  
                  (41,359
                  )
                  
                  
                  (39,676
                  )Unused
      net operating losses
                  
                  
                  15,308
                  
                  
                  
                  22,430$
                  -
                  
                  
                  $
                  -





Management's
intention is to permanently reinvest the majority of the earnings of foreign
subsidiaries in the expansion of its foreign
operations.  Unrepatriated earnings, upon which U.S. income taxes have
not been accrued, are approximately $900,000 at December 31,
2009.  Such unrepatriated earnings are deemed by management to be
permanently reinvested.  The estimated federal income tax liability
(net of estimated foreign tax credits) related to unrepatriated foreign earnings
is $18,000 under the current tax law.





The
president of the United States has presented a budget to the United States
Congress which contains various modifications to international tax
rules.  Some of the proposed changes might subject the Company to,
among other things, additional income taxes, restrictions on how foreign tax
credits would be calculated and affect taxation regarding the transfer of
intangible property.  The Company cannot ascertain at this time what
the final outcome of this proposed legislation will be of the effect, if any, on
the Company's results of operations or financial condition.





As of
December 31, 2009, the Company recorded a deferred tax asset associated with a
foreign net operating loss ("NOL") carryforward of approximately $4.3 million
acquired in connection with the Genesis acquisition and U.S. net operating loss
carryforward of approximately $168,000 that was fully offset by a valuation
allowance due to the determination that it was more likely than not that the
Company would be unable to utilize those benefits in the foreseeable
future.  The Company's foreign NOL expires in 2014 and the U.S. NOL
expires in 2025.






45




EMERGING
MEDIA HOLDINGS INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR YEARS ENDED DECEMBER 31, 2009 AND 2008


The types
of temporary difference between tax basis of assets and liabilities and their
financial reporting amounts that give rise to the deferred tax liability and
deferred tax asset and their approximate tax effects are as
follows:





Years
      Ended December 31,2009
              
              
              2008Temporary
              
              
              
              
              
              TemporaryDifference
              
              
              Tax
      Effect
              
              
              Difference
              
              
              Tax
      EffectDeferred
      tax assets:  CurrentForeign
      net operating losscarryforward
              
              $
              4,300,000
              
              
              $
              1,075,000
              
              
              $
              -
              
              
              $
              -U.S.
      net operating losscarryforward
              
              
              168,000
              
              
              
              57,000
              
              
              
              123,000
              
              
              
              42,000Valuation
      allowance
              
              
              (4,468,000
              )
              
              
              (1,132,000
              )
              
              
              (123,000
              )
              
              
              (42,000
              )Net
      deferred income tax asset
              
              $
              -
              
              
              $
              -
              
              
              $
              -
              
              
              $
              -





15.
STOCKHOLDERS' EQUITY





Common
Stock





On May 2,
2008, the Company received proceeds of $5,000,000 from a private investor from
the sale of 1,250,000 shares of the Company's common stock.





The net
proceeds of the private placement was primarily used to fund the Company’s
operations.





Preferred
Stock





The
Company has authorized 1,000,000 shares of preferred stock to be designated for
issuance in connection with the acquisition of Media Top Prim.  The
preferred shares are convertible into common shares on a 1:1
basis.  In 2009, the 1,000,000 preferred shares were converted into
1,000,000 common shares.  As of December 31, 2009, no preferred shares
were outstanding.





Treasury
Stock





On
September 22, 2008, the Board of Directors authorized the Company to purchase
shares of the Company's common stock in the open market.  As of
December 31, 2009, the Company repurchased 9,800 shares in the amount of
$9,237.  No shares have been repurchased subsequent to December 31,
2009.





46




EMERGING
MEDIA HOLDINGS INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR YEARS ENDED DECEMBER 31, 2009 AND 2008









16
BUSINESS SEGMENT INFORMATION





FASB ASC
280-10-10, "Segment Reporting" ("ASC 280-10-10"), established standards for
reporting information about operating segments.  Operating segments
are defined as components of an enterprise about which separate financial
information is available is evaluated regularly by management.  The
Company is organized by geographical area and industry segment.





2009
              
              
              2008Net
      Revenue by Geographic Areas:United
      States
              
              $
              -
              
              
              $
              -Europe
              
              
              4,228,497
              
              
              
              1,872,892$
              4,228,497
              
              
              $
              1,872,892Net
      Revenue by Industry Segment:Media
              
              $
              2,058,142
              
              
              $
              1,872,892Road
      Construction
              
              
              2,170,355
              
              
              
              -$
              4,228,497
              
              
              $
              1,872,892Loss
      From Operations:Media
              
              $
              (234,662
              )
              
              $
              (39,131
              )Road
      Construction
              
              
              227,256
              
              
              
              -$
              (7,406
              )
              
              $
              (39,131
              )Capital
      Expenditures:Media
              
              $
              115,135
              
              
              $
              54,247Road
      Construction
              
              
              -
              
              
              
              -$
              115,135
              
              
              $
              54,247Depreciation
      and Amortization:Media
              
              $
              111,374
              
              
              $
              121,886Road
      Construction
              
              
              249,827
              
              
              
              -$
              361,201
              
              
              $
              121,886Total
      Assets:United
      States
              
              $
              1,082,322
              
              
              $
              4,913,781Europe
              
              
              15,334,630
              
              
              
              5,301,126$
              16,416,952
              
              
              
              10,214,907


47





EMERGING
MEDIA HOLDINGS INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR YEARS ENDED DECEMBER 31, 2009 AND 2008







17.
COMMITMENTS AND CONTINGENCIES





a)
            Contracts





1) The
Company entered into a retransmission rights agreement with Russian Broadcasting
Channels JSC “NTV” and JSC “NTV-Mir” owned by Gazprom Media, a wholly-owned
subsidiary of the GazProm Corporation (a related party to Alkasar Region LLC, a
50% investor in Alkasar Media Services S.R.L.), to retransmit programs from
these television networks. The contract is on a long term basis through 2010 and
the Company will pay $229,333 per year. For the years ended December 31, 2009
and 2008, the Company expensed $229,333 and $229,333, respectively.





2) The
Company entered into a retransmission rights agreement with Russian Broadcasting
Channel JSC “TNT-Teleset” owned by Gazprom Media, a wholly-owned subsidiary of
GazProm Corporation (a related party to Alkasar Region LLC, a 50% investor in
Alkasar Media Services S.R.L.) to retransmit programs from this television
network. The contract is on a long term basis through 2012 and the Company will
pay $189,200 in 2010. For the years ended December, 2009 and 2008, the Company
expensed $174,700 and $142,400, respectively.





3) On
June 17, 2008, the Company entered into an agreement to acquire Way Media, LTD
(“Way Media”), a Romanian company.  Way Media is one of the top five
Romanian outdoor advertising companies with a developed network in more than 22
cities.  Way Media offers the planning and production of high quality
outdoor advertising strategies, as well as installation and maintenance
throughout the country of Romania.





The
Company paid a deposit against the purchase price of approximately
$254,000.  The acquisition was terminated during 2008 due to the
recent global financial crisis that has affected the outdoor advertising market
in Romania.  The Company transferred the deposit to IPA and released
the Romanian company from the obligation.  See Note 6 for further
information.





b)
            Leases





The
Company leases various office facilities.  Some of these leases
require the Company to pay certain executory costs (such as maintenance and
insurance).  The leases contain no escalation clauses or capital
improvements funding provisions.





Future minimum lease payments for operating leases are
approximately as follows:





Year
      EndingDecember
      31,2010
              
              $
              122,5682011
              
              
              86,6662012
              
              
              55,0002013
              
              
              55,0002014
              
              
              55,000$
              374,234


Rent expense was $111,298 and $66,568
for the years ended December 31, 2009 and 2008, respectively.





48





EMERGING
MEDIA HOLDINGS INC. AND SUBSIDIARIES
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 AS OF AND
FOR YEARS ENDED DECEMBER 31, 2009 AND 2008





18. MAJOR
CUSTOMERS





The
Company had revenues to two customers in excess of ten percent of consolidated
net revenues in 2009.  The combined revenue from these two customers
was $2.0 million during the year ended December 31, 2009, representing 47.4% of
total sales.  Management believes the loss of these customers could
have a material adverse effect on the Company's results of operations, financial
position and cash flows.





19. LEGAL
PROCEEDINGS





The
Company is a defendant in a lawsuit captioned Case File No. 44.952/3/2007,
Compania Nationala de Autostrazi si Drumuri Nationale in Romania ("CNADR") vs.
Genesis International S.A., brought before ICCJ - Commercial
Department.  CNADR has asked the court for the Company to pay $217,238
as a penalty for delay in the execution of the works set forth in Contract No.
2187/2003 - "Primary Rehabilitation of DN 58 Caransebes - Anina" and in Contract
No. 2185/2003 - "Primary Rehabilitation of DN 41 Dara -
Oltenita".  The Company believes it does not owe the penalty and
intends to vigorously protest the amount.  A hearing is set for April
15, 2010.





20.
SUBSEQUENT EVENT





On
February 20, 2010, the Company acquired an additional 20% of the outstanding
shares of Genesis from SC Straco Group SRL, a Romanian company, in exchange for
the issuance of 1,250,000 shares of the Company's common stock, valued at
$500,000, the fair value of the shares at the time of issuance.  The
following unaudited proforma summary of results of operations assume the
additional 20% interest had been acquired as of October 1, 2009.





Years
      EndedDecember31,2009Net
      sales
              
              $
              4,228,497Net
      earnings attributable toEmerging
      Media Holdings, Inc.common
      shareholders
              
              
              52,072Earnings
      per share - diluted
              
              $
              0.00


49





Item
9. Changes In and Disagreements With Accountants on Accounting and Financial
Disclosure.




None.




Item
9A (T). Controls and Procedures.




As
supervised by our board of directors and our principal executive and principal
financial officers, management has established a system of disclosure controls
and procedures and has evaluated the effectiveness of that
system.  The system and its evaluation are reported on in the below
Management's Annual Report on Internal Control over Financial
Reporting.  Our principal executive and  financial officer
has concluded that our disclosure controls and procedures (as defined in the
1934 Securities Exchange Act Rule 13a-15(e)) as of December 31, 2009, are
effective, based on the evaluation of these controls and procedures required by
paragraph (b) of Rule 13a-15.





Management's
Annual Report on Internal Control over Financial Reporting





Management
is responsible for establishing and maintaining adequate internal control over
financial reporting, as such term is defined in Rule 13a-15(f) of the Securities
Exchange Act of 1934 (the "Exchange Act").  Internal control over
financial reporting is a process designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with U.S. generally
accepted accounting principles.





Management
assessed the effectiveness of internal control over financial reporting as of
December 31, 2009. We carried out this assessment using the criteria of the
Committee of Sponsoring Organizations of the Treadway Commission (COSO) in
Internal Control—Integrated Framework. Management concluded in this assessment
that as of December 31, 2009, our internal control over financial reporting is
effective.





This
annual report does not include an attestation report of our registered public
accounting firm regarding internal control over financial
reporting.  Management's report was not subject to attestation by our
registered public accounting firm, pursuant to temporary rules of the Securities
and Exchange Commission that permit us to provide only management's report in
this annual report.





There
have been no significant changes in our internal control over financial
reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act)
during the fourth quarter of 2009 that have materially affected, or are
reasonably likely to materially affect, our internal control over financial
reporting.




Item
9B. Other Information.




None.




50





PART
III




Item
10. Directors, Executive Officers, and Corporate Governance.




The
following table sets forth the names, positions and ages of our executive
officers and directors, both as of as of December 31, 2009.





Name
            
            Age
            
            TitleIurie
      Bordian
            
            48
            
            Chairman
      of the Board, Chief Executive Officer ,Chief Financial
    OfficerRenauld
      R. Williams
            
            31
            
            PresidentOxana
      Boico
            
            34
            
            Director
      and Chief Accounting OfficerViorel
      B. Sareboune
            
            36
            
            DirectorRadu
      Lazar
            
            32
            
            Director




Set forth
below is a brief description of the background of each of our executive officers
and directors, based on the information provided to us by them.




Iurie
Bordian, CEO and Chairman since October 2006 and CEO of Cabavarum
SRL.


From 2002
to 2003 he co-founded MILLAGRO SRL in Moldova and serves as CEO and Director
General. In 2002, he was Director General of MA-VEST SRL, in Moldova. From 1998
to 2000 he was CFO of MA-VEST SRL, Moldova. From 1994-1998 he was Chief Legal
Council of "MA-VEST" SRL. From 1992-1994 he worked in the State Control
Department of the Republic of Moldova as Chief of its District Branch in the
District of Soroca. From 1990-1992 he was legal counselor the City Council in
the District of Soroca From 1988-1990 he worked as investigator (Economic and
Financial offences) for the Ministry of Internal Affairs of the Republic of
Moldova. From 1985-1990 he served as Chief Investigator at the Public
Prosecutor's Office of the Republic of Moldova. From 1983 to 1985 he worked as
Legal Counselor at the Soroca District Trade Association. Mr. Bordian's
education includes the State University of Moldova and the University of
Cluj-Napoca, Romania. He has a degree in Financial Law. He is fluent in
Romanian, Russian, and French and has working knowledge of English. Address:
21,Viilor 9/4 str. Soroca, Republic of Moldova, MD-2000





Renauld
R. Williams, President since January 17, 2008.


From 2000
to present Mr. Williams is also President and Co-Founder of Full on Productions
Inc. and managing member of Federal Media Alliance LLC. From 1998 to 2000, Mr
Williams was a producer with Comcast Cable Advertising. Mr. Williams is also
member of the American Advertising Federation (AAF), Orlando Advertising
Federation (OAF), Orlando Chamber of Commerce and Orlando Convention and
Visitors Bureau (OCVB).





Vivorel
B. Sareboune, Director


He
received Bachelor of Arts and Master of Arts degrees in 1994 and 1997,
respectively, from Moldova State University, Moldova, specializing in arts and
civil and international law. He received a Master of Business Administration in
2001, and a Master of Science in Accounting in 2005, from the University of
Central Florida, Orlando, Florida. Since December 2007, Mr. Sareboune has been
the Vice President Finance and New Business Development for Life Extension
Nutrition Center, Maitland, Florida. From November 2005 to November 2007, Mr.
Sareboune was employed as a tax associate for CNL Hotel and Resorts Inc.,
Orlando, Florida, and also from November 2005 to June 2006, he was a business
and financial planning consultant with EDIS Secure LLLP, Orlando, Florida. From
September 2003 to October 2005, Mr. Sareboune was the corporate accountant for
CNLR (NNN) and CNL Hospitality Corp., Orlando, Florida.





Mr. Radu
Lazar, Director.


He
received a B.S. degree in International Economic Relations from the Academy of
Economic Studies, Chisinau, Moldova, in 1999. From September 2007 to the
present, he has been a project manager with Endava, an information technology
consulting company in Chisinau, Moldova. From 1998 to September 2007, Mr. Lazar
was with CNFA, Chisinau, Moldova, for the last two years of which he was a grant
administrator for U.S. Agency for International Development funds for private
enterprise investments in Moldova, as part of the agency's agribusiness
development project. Prior to September 2005, Mr. Lazar was an agribusiness
enterprise development coordinator, an agribusiness program


assistant
and a property management/logistics specialist with CNFA.




51




Oxana
Boico, Chief Accounting Officer


On July
5, 2007 the Board of Directors appointed Ms. Oxana Boico as a new Board Member
and the Chief Accounting Officer of the Company.  Since February 2005,
Ms. Boico was a comptroller of the Company and reported directly to Iurie
Bordian, our CEO and CFO.  Oxana graduated with a Masters degrees from
Private University of Human Knowledge of Moldovain 1997. She has degrees in
Finance, Accounting and Management. Ms. Boico has an extensive background in
U.S.GAAP and prior audit experience with public and private
companies.





No
director, director nominee, officer or affiliate of the Company, owner of record
or beneficially of more than five percent of any class of our voting securities
has, to our knowledge, during the last five years: (1) been convicted of any
criminal proceeding (excluding traffic violations or similar misdemeanors); or
(2) been a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and as a result of such proceeding was or is subject to a
judgment, decree or final order enjoining future violations of, or prohibiting
or mandating activities subject to, U.S. federal or state securities laws or
finding any violations with respect to such laws.





Corporate
Governance





Directors
are elected at the annual stockholder meeting or appointed by our Board of
Directors and serve for one year or until their successors are elected and
qualified. When a new director is appointed to fill a vacancy created by an
increase in the number of directors, that director holds office until the next
election of one or more directors by stockholders.  Officers are
appointed by our Board of Directors and their terms of office are at the
discretion of our Board of Directors.





Our Board
of Directors has determined thatVivorel B.
Sareboune and Radu Lazar are independent as defined by the NYSE
Rules.




Committees
of our Board of Directors


Audit Committee. Our
Board of Directors has established an Audit Committee, the current members of
which are Vivorel B. Sareboune and Radu Lazar. Each member of the Audit
Committee has been determined to be independent under the standards for
independence for audit committee members established by the NYSE. In addition,
the Board of Directors has determined that each member of the Committee is
financially literate and that Viorel Saraboune qualifies as an “audit committee
financial expert” under the definition promulgated by the SEC. The Audit
Committee reviews our accounting, auditing, financial reporting, and internal
control functions and selects our independent auditors. The Audit Committee will
operate under a written charter, which is under review at this
time.


The audit
committee’s primary responsibility is to assist the Board in its oversight of
the integrity of the Company’s financial reporting process and systems of
internal control, to evaluate the independence and performance of the
Corporation’s independent registered public accounting firm, Madsen &
Associates, CPA’s Inc. (“Madsen”), and internal audit functions and to encourage
private communication between the audit committee and Madsen and the internal
auditors.





The audit
committee met on March 30, 2010. In discharging its responsibility, initially
the audit committee reviewed and discussed the audited financial statements
for fiscal year 2009 with management and Madsen, including the matters required
to be discussed by Statement on Auditing Standards (SAS) No. 61,
Communication with Audit Committees.





In
addition, the audit committee received the written disclosures and the letter
from Madsen required by applicable requirements of the Public Company Accounting
Oversight Board regarding Madsen’s communications with the audit committee
concerning independence. The audit committee further discussed with Madsen the
issue of its independence from the Company, and made a determination to
recommend to our Board of Directors to include of the audited consolidated
financial statements in this Annual Report on Form 10-K for the year ended
December 31, 2009.





52





The audit
committee also will negotiate the hiring of Madsen for the 2010 audit and
pre-approve all fees which SEC rules require the committee to approve to ensure
that the work to be performed will be permissible under applicable standards and
would not impair Madsen’s independence.





Other Committees. The
Board does not have standing compensation or nominating committees. The Board
does not believe a compensation or nominating committee is necessary based on
the size of the Company, the current levels of compensation to corporate
officers and the beneficial ownership by Chiril Luchinsky  of 30% of
the Company’s outstanding common stock. The Board will consider establishing
compensation and nominating committees at the appropriate time.





The
entire Board of Directors participates in the consideration of compensation
issues and of director nominees. To date, the Board of Directors has not
formally established any criteria for Board membership. Candidates for director
nominees are reviewed in the context of the current composition of the Board,
the Company’s operating requirements and the long-term interests of its
stockholders. In conducting this assessment, the Board of Directors considers
skills, diversity, age, and such other factors as it deems appropriate given the
current needs of the Board and the Company, to maintain a balance of knowledge,
experience and capability. In particular, weight is given to experience relevant
to the Company’s operations in the Republic of Moldova and familiarity with
international business issues.





The
Board’s process for identifying and evaluating nominees for director, including
nominees recommended by stockholders, involves compiling names of potentially
eligible candidates, conducting background and reference checks, conducting
interviews with the candidate and others (as schedules permit), meeting to
consider and approve the final candidates and, as appropriate, preparing an
analysis with regard to particular recommended candidates.





Stockholder
Communications




The Board
has not established a formal process for stockholders to send communications,
including director nominations, to the Board; however, the names of all
directors are available to stockholders in this Information Statement. Any
stockholder may send a communication to any member of the Board of Directors, in
care of the Company, at 1809 East Broadway Street, Suite 175, Oviedo, Florida
32765 (Attention: Secretary). Director nominations submitted by a stockholder
will be considered by the full Board. Each communication should clearly specify
the name of the individual director or group of directors to whom the
communication is addressed. Communications sent by email will be delivered
directly to the Corporate Secretary, who will promptly forward such
communications to the specified director addressees. Communications sent by mail
will be promptly forwarded by the Corporate Secretary to the specified director
addressee or, if such communication is addressed to the full Board of Directors,
to the Chairman of the Board, who will promptly forward such communication to
the full Board of Directors. Due to the infrequency of stockholder
communications to the Board, the Board does not believe that a more formal
process is necessary. However, the Board will consider, from time to time,
whether adoption of a more formal process for such stockholder communications
has become necessary or appropriate.





In
general, advance notice of nominations of persons for election to our Board or
the proposal of business to be considered by the shareholders must be given to
our Secretary no earlier than the October 1 or later than December 1 preceding
the next year's annual meeting, which would be scheduled in the month or May or
June.





A
shareholder's notice of nomination should set forth (i) as to each person whom
the shareholder proposes to nominate for election or re-election as a director,
all information relating to such person that is required to be disclosed in
solicitations of proxies for election of directors, or is otherwise required, in
each case pursuant to Regulation 14A under the Securities Exchange Act of 1934
(including such person's written consent to being named in the proxy statement
as a nominee and to serving as a director, if elected); (ii) as to any other
business that the shareholder proposes to bring before the meeting, a brief
description of the business desired to be brought before the meeting, the
reasons for conducting such business at the meeting and any material interest in
such business of such shareholder and the beneficial owner, if any, on whose
behalf the proposal is made; and (iii) as to the shareholder giving the notice
and the beneficial owner, if any, on whose behalf the nomination or proposal is
made, (A) the name and address of such shareholder, as they appear on our books,
and of such beneficial owner, (B) the number of shares of our common stock that
are owned (beneficially or of record) by such shareholder and such beneficial
owner, (C) a description of all arrangements or understandings between such
shareholder and such beneficial owner and any other person or persons (including
their names) in connection with the proposal of such business by such
shareholder and any material interest of such shareholder and of such beneficial
owner in such business, and (D) a representation that such shareholder or its
agent or designee intends to appear in person or by proxy at our annual meeting
to bring such business before the meeting.





53





Other
Information about our Board of Directors





During
2009, our Board of Directors did not meet. All directors attended all of the
meetings of the Board and committees of the Board on which they
served.





We do not
have a formal policy on attendance at meetings of our shareholders; however, we
encourage all Board members to attend shareholder meetings that are held in
conjunction with a meeting of our Board of Directors.




Section
16(a) Beneficial Ownership Reporting Compliance




Section
16(a) of the Exchange Act requires our director, executive officer and persons
who beneficially own more than ten percent of our outstanding common stock to
file reports with the SEC regarding initial statement of ownership, statement of
changes of ownership and, where applicable, annual statement of ownership of our
common stock.  Such persons are required by SEC regulations to furnish
us with copies of all such statements they file.





Our
directors Vivorel B. Sareboune and Radu Lazar, appointed to our Board of
Directors on May 28, 2008, were required to file Form 3 Initial Statements of
Beneficial Ownership within 10 days of their appointment, which forms have not
yet been filed.  Oxana Boico, our Chief Accounting Officer, was
appointed to this office on July 5, 2007 and was required to file a Form 3
within 10 days of her appointment, which form has not yet been filed. Renauld R.
Williams was appointed as our President on January 17, 2008, and was required to
file a Form 3 Initial Statement of Beneficial Ownership within 10 days of his
appointment, which form has not yet been filed.





Code
of Ethics




We have
adopted a Code of Ethics and Conduct within the meaning of Item 406(b) of
Regulation S-B of the Exchange Act. A copy of this Code may be obtained by
requesting a copy in writing to the Company’s Secretary at 1809 East Broadway
Street, Suite 175, Oviedo, Florida 32765. This Code applies to our directors and
executive officers, such as our principal executive officer, principal financial
officer, controller, and persons performing similar functions for
us.





54




Item
11. Executive Compensation.




Summary
Compensation Table





The
following table sets forth all compensation awarded to, earned by, or paid for
all services rendered to the Company during fiscal 2007, 2006 and 2005 by our
Chief Executive Officer and any executive officer who received annual
compensation in salary and bonus combined in excess of $100,000 during those
years. Each person below is referred to as a named executive
officer.





SUMMARY
COMPENSATION TABLE





Name
      and
              Principal
              Position
              
              
              
              
              
              
              
              (a)
            Year
              
              
              
              
              
              
              
              
              
              (b)
            Salary
              ($)
              
              
              
              
              
              
              
              
              (c)
            Bonus
              ($)
              
              
              
              
              
              
              
              
              (d)
            Stock
              Awards
              ($)
              
              
              
              
              
              
              
              (e)
            Option
              Awards
              ($)
              
              
              
              
              
              
              
              (f)
            Non-Equity
              Incentive
              Plan
              Compensation
              ($)
              
              
              
              
              (g)
            Change
      in
              Pension
              Value
      and
              Nonquali-
              fied
      Deferred
              Compensation
              Earnings
              ($)
              
              
              (h)
            All
              Other
      Compen-
              Sation
              
              
              
              
              
              
              (i)
            Total
              ($)
              
              
              
              
              
              
              
              
              (j)Iurie
      Bordian, Chief Executive Officer (1)
            2007
            -0-
            
            
            
            
            
            
            -0-2008
            -0-
            
            
            
            
            
            
            -0-2009
            $33,000
            
            
            
            
            
            
            $33,000




(1) Mr.
Bordian became Chief Executive Officer on October 16, 2006.







(2) Compensation
is paid in Moldovan leí, the official currency of Moldova, and the amount set
forth in this table is the equivalent in U.S. dollars.




Stock
Options Granted and Exercised in The Year Ended December 31, 2008




No stock
option grants were made to Iurie Bordian in the fiscal year ended December 31,
2009.




Director
Compensation





Currently,
our directors do not receive compensation for serving on our Board of
Directors.




Employment
Agreements




Neither
the Company, nor any of our subsidiaries, have entered into an employment
contract with a named executive officer. Furthermore, we do not, nor do any of
our subsidiaries, anticipate entering into an employment contract with any named
executive officer in the near future.




55





Employee
Benefit Plans




We do not
currently have any type of employee compensation plan for our employees,
officers or directors. Furthermore, we do not anticipate offering any such plans
in the near future.




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




The table
below sets forth information regarding the beneficial ownership of our common
stock as of March 26, 2010 by the following individuals or groups:








•
            each
      person or entity who we know beneficially owns more than 10.0% in the
      aggregate;•
            each
      of our named executive officers;•
            each
      of our directors; and•
            all
      directors and named executive officers as a
  group.




Unless
otherwise indicated, the address of each of the individuals listed in the table
is c/o Emerging Media Holdings, Inc. 1809 E. Broadway St, Suite 175, Oviedo, FL
32765




The
percentage of beneficial ownership in the following table is based upon
16,303,000 shares of common stock outstanding as of March 26,
2010.  Beneficial ownership is determined in accordance with the rules
of the SEC and generally includes voting or investment power with respect to
securities.  We do not have any  outstanding options,
warrants or other conversion rights.





Name
      of Beneficial Owner
              
              Number of Shares
                Beneficially Owned
              
              
              Approximate
                Percentage
                of
      Class OutstandingChiril
      Luchinsky
              
              
              4,751,000
              
              
              
              29.14%Serguei
      Luchinsky
              
              
              1,250,000
              
              
              
              7.66%Iurie
      Bordian
              
              
              100,000
              
              
              
              *Century
      Enterprises, Inc.
                Blake
      Bldg., Suite 102
                Belize
      City, Belize
              
              
              1,400,000
              
              
              
              8.58%Lilea
      Ciumac
                Str
      V Chisinau
                Republic
      of Moldova
              
              
              1,331,600
              
              
              
              8.16%Cornel
      Esanu
                Str
      Miron Chisinau
                Republic
      of Moldova
              
              
              1,331,600
              
              
              
              8.16%Domnica
      Rorovschi
                Str
      32 August Chisinau
                Republic
      of Moldova
              
              
              1,331,600
              
              
              
              8.16%Rodica
      Turcan
                Str
      Scinoa Nou Chisinau
                Republic
      of Moldova
              
              
              1,331,600
              
              
              
              8.16%All
      officers and directors as a group
              
              
              100,000
              
              
              
              *
 * Less
than 1%.


Securities
Authorized for Issuance Under Equity Compensation Plans





We do not
currently have any type of equity compensation plan for our employees, officers
or directors. Furthermore, we do not anticipate offering any such plans in the
near future.




Item
13. Certain Relationships and Related Transactions, and Director
Independence.




In
September 2007, Chiril Luchinsky, a major stockholder of the Company, initially
advanced $366,449 to the Company.  The note is due upon demand with
interest at 10% per annum.  The Company repaid the note in October
2008.  As of December 31, 2008 and 2007, the amount due Mr. Luchinksy
was $-0- and $74,765, respectively.  For the years ended December 31,
2008 and 2007, interest amounted to $3,785 and $6,185,
respectively.





56





In
November 2007, the Company received an advance of $5,000 from a company in which
Mr. Luchinksy has an equity interest.  Interest is 10% per annum and
for the years ended December 31, 2008 and 2007, interest amounted to $500 and
$500, respectively.  The balance due was $5,000 and $5,000 as of
December 31, 2008 and 2007, respectively.




Item
14.  Principal Accountant Fees and Services




The
following table presents fees accrued for audit services and other services
provided by Wiener, Goodman & Company, P.C. during fiscal year 2008 and
Madsen & Associates, CPA’s Inc. during fiscal year 2009.








2009
            
            
            2008Audit
      Fees
            
            $
            56,870
            
            
            $
            49,232Audit-related
      FeesTax
      Fees
            
            
            2,500All
      Other FeesTotal
      Fees
            
            $
            59,370
            
            
            $
            49,232








Audit
Fees





Audit
fees were for professional services rendered for the audit of our annual
financial statements, the review of the financial statements, services in
connection with our statutory and regulatory filings for fiscal
2009.





Audit-Related
Fees





Audit
related fees were for assurance and related services rendered that are
reasonably related to the audit and reviews of our financial statements for
fiscal 2009, exclusive of the fees disclosed as Audit Fees above. These fees
include assistance with registration statements and consents not performed
directly in connection with audits.





All
Other Fees





We did
not incur fees for any services, other than the fees disclosed above relating to
audit, audit-related and tax services, rendered during fiscal 2009.





Audit Services. Audit
services include the annual financial statement audit and other procedures
required to be performed by the independent auditor to be able to form an
opinion on our financial statements.





Audit-Related
Services. Audit-related services are assurance and related services that
are reasonably related to the performance of the audit or review of our
financial statements which historically have been provided to us by the
independent auditor and are consistent with the SEC’s rules on auditor
independence.




All Other Services.
Other services are services provided by the independent auditor that do not fall
within the established audit, audit-related and tax services
categories.




57




Item
15. Exhibits and Financial Statement Schedules.




(a)(3)
Exhibits









Exhibit
      No.
            
            Description3.1
            
            Articles
      of Incorporation (Incorporated by reference to Exhibit 3.1 to the
      Company’s Form 10-SB, filed January 23, 2007).3.2
            
            By-Laws
      (Incorporated by reference to Exhibit 3.2 to the Company’s Form 10-SB,
      filed January 23, 2007).10.1
            
            Distribution
      Agreement, dated December 29, 2006 with NTV Hungary Commercial Limited NTV
      Hungary Commercial Limited Liability Company (Incorporated by reference to
      Exhibit 10.1 to the Company’s Form 10-SB, filed January 23,
      2007).10.2
            
            Acquisition
      Agreement, dated January 24, 2008, between the Company and Media Top Prim,
      Ltd. (Incorporated by reference to Exhibit 10.2 to the Company’s Current
      Report on Form 8-K, filed May 5, 2008).10.3
            
            Additional
      Agreement, dated May 2, 2008, to Acquisition Agreement, dated January 24,
      2008, between the Company and Media Top Prim, Ltd. (Incorporated by
      reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K,
      filed May 5, 2008)10.4
            
            Share
      Purchase Agreement, dated as of June 10, 2009, between the Company and IPA
      International Project Agency Establishment (Incorporated by reference to
      Exhibit 10.4 to the Company’s Current Report on Form 8-K, filed November
      4, 2009).10.5
            
            Agreement,
      dated as of February 23, 2010, between the Company and SC Stratco Group
      SRL. (Incorporated by reference to Exhibit 10.5 to the Company’s Current
      Report on Form 8-K, filed March 8, 2010.10.6
            
            Additional
      Agreement, dated as of March 5, 2010, between the Company and Media Top
      Prim Ltd., filed herewith.31
            
            Certification  of
      Principal Executive Officer and Chief Financial Officer Pursuant to
      Section 302 of the Sarbanes Oxley Act of 2002, filed
    herewith.32
            
            Certification
      of Principal Executive Officer and Chief Financial Officer Pursuant to
      18  U.S.C. Section 1350 as adopted pursuant to
      Section  906 of the Sarbanes-Oxley Oxley Act of 2002, filed
      herewith.





58





SIGNATURES





Pursuant
to the requirements of Section 12(g) of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned, thereunto duly authorized, on March 31, 2010.








EMERGING
      MEDIA HOLDINGS, INCDate:
      March 31, 2010
            
            By:
            
            /s/
      Iurie BordianIurie
      Bordian, Chief Executive Officer, Chief Financial Officer and
      DirectorBy:
            
            /s/
      Oxana BoicoOxana
      Boico, Chief Accounting Officer











Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been
signed below by the following person on behalf of the Registrant in the
capacities indicated, on March 31, 2010.







/s/
      Renauld R. WilliamsRenauld R. Williams,
      PresidentBy:/s/ Vivorel B.
      SarebouneVivorel B.
      Sareboune, DirectorBy:Radu
      Lazar, DirectorBy:/s/
      Oxana BoicoOxana Boico, Chief
      Accounting Officer and Director