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

                                   FORM 10KSB
                  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

  For the Fiscal Year Ended July 31, 2002    Commission File Number: 333-75048

                              GROWTH MERGERS, INC.
                 (Name of small business issuer in its charter)

Nevada                                7990                      88-0488069
(State or other           (Primary Standard Industrial       (I.R.S. Employer
jurisdiction of              Classification Number)       Identification Number)
incorporation or
organization)

                                 2267 Aria Drive
                             Henderson, Nevada 89052

      1901 - 1188 Quebec Street, Vancouver, British Columbia, Canada V6A 4B
                            Telephone (604) 780-5654
          (Address and telephone number of principal executive offices)

                                  With copy to:
                                 Stepp Law Group
                           1301 Dove Street, Suite 460
                         Newport Beach, California 92660
                     Tel: (949) 660-9700 Fax: (949) 660-9010
                               (Agent for Service)
           (Name, address and telephone number for Agent for Service)


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

                                      None


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

                     Common Stock, par value $.001 per share
                                (Title of Class)

Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.

                                                     Yes [X] No [ ]

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

                                                     Yes [X] No [ ]

The issuer's revenues for its most recent fiscal year were $1,027.

As of July 31, 2002, the registrant had 11,823,500 shares of common stock, $.001
par value, issued and outstanding.

Documents Incorporated By Reference:  None

Transitional Small Business Issuer Disclosure Format (check one): Yes [ ] No [X]


<PAGE>






                                TABLE OF CONTENTS
                                -----------------


PART I....................................................................   1

   ITEM 1.  DESCRIPTION OF BUSINESS.......................................   1
      Growth of the Internet..............................................   1
      Target Market.......................................................   2
      Technology..........................................................   2
      Anticipated Sources of Revenue......................................   2
      Products and Services...............................................   2
      Competition.........................................................   3
      Growth Strategy.....................................................   3
   ITEM 2.  DESCRIPTION OF PROPERTY.......................................   3
   ITEM 3.  LEGAL PROCEEDINGS.............................................   3
   ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS...........   3

PART II...................................................................   4

   ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS......   4
   ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.....   4
   ITEM 7.  FINANCIAL STATEMENTS..........................................   7

INDEPENDENT AUDITORS' REPORT..............................................   8

   ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
            AND FINANCIAL DISCLOSURE......................................  17

PART III..................................................................  17

   ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
            COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT.............  17
   ITEM 10. EXECUTIVE COMPENSATION........................................  18
   ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
            MANAGEMENT....................................................  18
   ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS................  19
   ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K..............................  19





















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PART I
------

ITEM 1.  DESCRIPTION OF BUSINESS
--------------------------------

Through our subsidiary, Adult Mergers, we own and operate an online adult
entertainment website, www.insidedesire.com and www.insidehardcore.com. Adult
                       --------------------     ----------------------
entertainment web sites have slightly varied business models which monetize the
traffic on their sites through multiple revenue streams, including advertising
and sponsorships, e-commerce and fees for subscription services and pay-per-view
events. We plan to develop a series of websites, which will provide various
forms of online entertainment, initially concentrating on offering
adult-oriented content and services to a wide geographic and demographic
customer base over the Internet through membership-based websites. Other URLs
which we have registered and for which we have web sites currently under
construction include www.insideasians.com, www.insidestud.com,
                     --------------------  ------------------
www.insideteengirls.com and www.insidefetish.com. Members purchase a trial or
-----------------------     --------------------
monthly membership using a credit card online, or via a bank withdrawal by
entering their checking account information (a direct withdrawal is completed by
iBill via the user's financial institution), or by calling a 900 number where
the membership fee is added to the user's telephone bill.

Our company through Adult Mergers commenced operations on October 19,2001 with
the launch of www.insidedesire.com. Adult Mergers registered the URL and
              --------------------
contracted development of the site to Teleteria, Inc. a Stamford, CT developer
of turnkey adult sites. On January 17, 2002 we registered and launched
www.insidehardcore.com to the public. This website was developed in-house by
----------------------
Adult Mergers and the content was developed and provided to our company by
Teleteria, Inc. Our company has raised $174,750 in cash from private placements,
which is sufficient to fund our operations for the next 12 months. Our company
has retained the necessary personnel and has developed third party relationships
with a credit card processor and an adult entertainment content provider to
provide all the necessary components of a successful adult entertainment
provider. We employ one full time employee and three part time employees to
carry out the day-to-day activities of our company. The employees develop and
market our websites and maintain all necessary records for business purposes.
Our credit card provider, iBill, provides us all credit card and 1-900
processing services required to operate an Internet adult website and Teleteria,
Inc provides all content for our sites for a fee.

Inside Desire offers adult oriented services to a wide geographic and
demographic customer base. Members purchase a trial or monthly membership using
a credit card online, or via a bank withdrawal by entering their checking
account information (a direct withdrawal is completed by iBill via the users
financial institution), or by calling a 900 number where the membership fee is
added to users phone bill. Adult Mergers has entered into a non-exclusive
agreement with iBill a third party billing Management Company. iBill is one of
the largest billing service providers in the adult entertainment industry, and
offers their services on a transaction-fee basis. Content on the site is
provided and managed by Teleteria, Inc. and is updated monthly. Marketing and
site maintenance is outsourced to a third party, private consultant.

We may, from time to time, evaluate potential acquisitions of other businesses,
products and technologies to enhance our present Internet adult entertainment
presence. In order to consummate potential acquisitions, we may issue our
shares.

Adult Mergers will centralize our operations in Vancouver BC Canada due its
comparatively lower salary rates, availability of qualified human resources and
access to top of the line Internet services.

Growth of the Internet
----------------------

The Internet has quickly emerged as a global medium that allows hundreds of
millions of people worldwide to obtain information, communicate and conduct
business electronically. In its June 1999 report, International Data
Corporation, or IDC, estimates that the number of Web users worldwide will grow
from approximately 142 million users in 1998 to 502 million by the end of 2003.
Additionally, IDC projects the number of Web users outside the U.S. to increase
from 79.4 million in 1998 to 325.4 million by 2003.





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As the number of Internet users continues to expand, the value of the Internet
as a commerce channel will continue to increase as more merchants move onto the
Internet to market and sell an ever-increasing variety of products and services.
According to IDC, worldwide commerce revenues on the Web are expected to grow to
approximately $1.3 trillion by the end of 2003. As e-commerce continues to
expand, vendors are increasingly relying on extensive advertising campaigns to
identify customers, build online brand awareness and increase product sales
online. Forrester Research estimates that the dollar volume of online
advertising will increase to over $17.2 billion in 2003. The interactive nature
of the Internet provides vendors, advertisers and content providers with the
ability to gather and evaluate valuable demographic, Web use and transactional
data on consumers. This data provides online marketers and businesses with a
significant new opportunity to increase the effectiveness of their direct
marketing campaigns by targeting their messages to specific groups of consumers,
as well as by frequently changing their advertisements in response to market
factors, current events and consumer feedback.

Target Market
-------------

Men between the ages of 18 and 34 represent a critical demographic group for
online advertisers and merchants. College students, in particular, are an
attractive demographic group for Internet advertisers and merchants. According
to Jupiter Communications, 90% of U.S. college students are currently online,
representing the highest Internet penetration rate of any age group. College
students are also expected to increasingly use the Internet to purchase goods
and services. According to Jupiter Communications, college students will spend
$2.5 billion in 2002 to purchase goods and services over the Internet.

Adult entertainment in the United States is a $10 billion industry, according to
Forrester Research. The Internet has helped the adult entertainment industry
experience tremendous growth in usage and revenues. According to the spring 1999
Jupiter/NFO Consumer Survey, men spend, on average, 33% of their time online
viewing adult content. Forrester Research estimates rapid growth in the years
that follow. Adult content dominates the paid online content market, which
includes subscription and pay-on-demand services, according to Datamonitor.
Datamonitor estimates that $1.4 billion of the $2.0 billion in paid online
content in 1999 was be attributable to adult content and $3.1 billion of the
projected $5.4 billion of paid online content projected for 2003 will be
attributable to adult content.

Technology
----------

We anticipate that Adult Mergers's network systems will consist of lightweight,
low cost, Intel-based systems running Linux. Linux is the operating system of
choice because it is freely distributed with no licensing cost, extremely
efficient for web serving, scalable, and numerous application developers
contributing to it. Other technologies we are considering for Adult Mergers's
platform include Apache for web serving, MySQL for database storage and PERL/PHP
for scripting language.

We will eventually decide whether or not Adult Mergers should be connecting
directly to a credit card network in order to bypass the middle tier providers
and significantly lower its transaction rates.

Anticipated Sources of Revenue
------------------------------

We intend to earn revenues from the following sources through the operation of
our existing website and additional contemplated websites featuring adult
content:

     (a)  Membership and associated fees;
     (b)  Usage fees;
     (c)  Advertising fees;
     (d)  E-commerce fees; and
     (e)  Pay-per-view events.

Products and Services
---------------------

In addition to providing adult entertainment content on our website, we are
presently examining other industry segments of the Internet entertainment
market, including online dating services and online multi-player gaming.



Form 10KSB                                                              Page 2
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Competition
-----------

Our primary competition is from other web-based providers of adult content,
although we do compete with other formats, such as video, CD ROM and print, for
the delivery of adult content. Many web sites compete with us for visitors,
subscribers, advertisers and e-commerce partners and we expect this competition
to increase in the future. We believe that the primary competitive factors in
our markets include brand recognition, the quality of content and products,
technology, pricing, ease of use, sales and marketing efforts and user
demographics. Many of our competitors and potential new competitors may have
greater financial, technical, marketing and distribution resources.

Larger competitors than us can spend more money on search engine marketing,
which can attract more customers to their websites than ours. In addition larger
competitors have the resources to hire more personnel to develop and market
their website. The more websites that you produce the greater competitor you can
become because you can create more traffic and create brand recognition (ie.
Playboy). We are a small adult entertainment provider that does not have the
resources of Playboy, Private Media or other large competitors indicated below
however we can compete with these large competitors and other small adult
operators by keeping our costs low as we do, develop websites in house like we
have and performing search engine marketing to drive market share to our
website.

Our significant competitors include Digital Rooster, Babenet, Private Media
Group and NuWeb. Private Media Group is a publicly listed company based in
Spain. Rick's Cabaret International, Inc., another publicly listed company based
in the United States, is poised to expand its presence in the market. Playboy
Enterprise Inc. is also publicly listed and operates an adult entertainment
destination website.

Growth Strategy
---------------

We continue to focus on growing www.insidedesire.com through our contacts within
                                --------------------
the industry, internal marketing efforts as well as developing our other sites.
We intend to create a group of sites offering a wide range of content. We will
then aggressively market these sites to both consumers as well as other adult
site operators for potential affiliate relationships. In these types of
relationships, site operators agree to share exit traffic from their sites and
any resulting revenue from referral sales. The online adult entertainment market
is characterized by a large number of profitable, small to mid-sized, privately
owned operations with fragmented supply chains, and is therefore a text book
case for consolidation. We believe that the vast majority of these operations do
not have exit strategies for their owners, and that many would consider selling
their operations in exchange for shares in a well recognized corporate entity.
Furthermore, we believe that the public markets would provide significantly
higher earnings multiple for a growing group of consolidating operators than any
individual company could get in this market space for a cash sale. As one
potential future growth strategy, we may consider acquiring established online
adult entertainment websites or providers and consolidating suppliers,
operations, management and human resources, as well as benefiting from economies
of scale in supply, production and management.


ITEM 2.  DESCRIPTION OF PROPERTY
--------------------------------

We rent our operating facilities located at suite 1901 - 1188 Quebec Street,
Vancouver, British Columbia, Canada V6A 4B3. These facilities are provided to us
at no charge by Mr. Barta and are located in his residence. This operating
facility functions as our main operating facility.

ITEM 3.  LEGAL PROCEEDINGS
--------------------------

We are not aware of any legal proceedings against us. We may be involved, from
time to time, in various legal proceedings and claims incident to the normal
conduct of our business.


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

During the fourth quarter of 2001, no matters were submitted to a vote of
security holders.



Form 10KSB                                                              Page 3
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PART II
-------

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
-----------------------------------------------------------------

The Company received a trading symbol on the OTC Electronic Bulletin Board which
is sponsored by the National Association of Securities Dealers (NASD) on August
29, 2002. The OTC Electronic Bulletin Board is a network of security dealers who
buy and sell stock. The dealers are connected by a computer network which
provides information on current "bids" and "asks" as well as volume information.

The Company has 11,823,500 registered, issued and outstanding common shares. The
Company has paid no cash dividends and has no outstanding options. There is no
public offering of equity and there is no proposed public offering of equity.


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

REVENUE:

Total revenue for the Growth Mergers Inc. was $1,027 for the quarter ended July
31, 2002, and was Nil for the comparable quarter ended July 31, 2001. Total
revenue was also $1,027 for the year ended July 31, 2002, as compared to Nil for
the six months ended July 31, 2001. (Due to the inception date of the company on
February 1, 2001, no comparable twelve-month period was available.)

The company has completed its web sites and has started marketing programs to
drive traffic to its "insidedesire.com" and "insidehardcore.com" web sites. The
company continues to employ IBill as the credit card and 1-900 number processing
company and has had no difficulties with respect to membership revenue
collection. In this quarter, Adult Mergers Inc. completed the following sites,
"insideasians.com", "insidestuds.com" and "insideteengirls.com" and will launch
them in the next quarter.


EXPENSES:

The majority of expenses still relate to the corporate costs associated with the
process of going public and the issuance of shares for cash and compensation.
The Company reported total expenses for the quarter ended July 31, 2002 of
$350,995, as compared to $13,653 for the quarter ended July 31, 2001. Total
expenses for the Company for the year ended July 31, 2002 was $ 1,041,000 as
compared to $ 26,439 for the six months ended July 31, 2001. (Due to the
inception date of the company on February 1, 2001, no comparable twelve-month
period was available.)

Audit expense for the quarter ended July 31, 2002 was $ 2,500 as compared to Nil
for the quarter ended July 31, 2001. Audit expense for the year ended July 31,
2002 was $ 7,675 as compared to $ 2,000 for the six months ended July 31, 2001.
(Due to the inception date of the company on February 1, 2001, no comparable
twelve-month period was available.)

Consulting fees and wages remained the largest expense. The expense for the
quarter ended July 31, 2002 was $335,889 as compared to $ 9,675 for the quarter
ended July 31, 2001. Consulting fees and wages expense for the year ended July
31, 2002 was $871,001 as compared to $ 15,675 for the six months ended July 31,
2001. (Due to the inception date of the company on February 1, 2001, no
comparable twelve-month period was available.)

During the year, the Company entered into various consulting contracts and paid
these contracts with the issuance of common shares. The excess of the amount
paid for the shares, being $.01 per share, and the proposed Initial Public
Offering Price ("IPO") of $0.20 per share was treated as compensation expense in
accordance with SEC staff policy on valuing shares in the first year prior to an
IPO. The consultants contract is a one-year contract starting November 14, 2001
extending to November 14, 2002. The compensation expense of $950,000 will be
charged to operations over the one-year period beginning November 14, 2001.
Additionally, shares were issued pursuant to Rule 506 of Regulation D and
Regulation S for services rendered or to be rendered. These shares were valued


Form 10KSB                                                              Page 4
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at $0.20 per share in accordance with SEC staff policy on valuing shares in the
first year prior to an IPO. The compensation expense of $215,200 will be charged
to operations over the one-year period. As shares were exchanged for services,
these expenses charged to Consulting fees and wages represent no cash outlay for
the Company.

These above noted compensation expenses charged to Consulting fees and wages
expense for the quarter ended July 31, 2002 was $ 322,464 as compared to $ Nil
for the quarter ended July 31, 2001. These compensation expenses charged to
Consulting fees and wages expense for the year ended July 31, 2002 was $789,131
as compared to Nil for the six months ended July 31, 2001.

Legal & organizational expense for the quarter ended July 31, 2002 was $7,895 as
compared to $ 3,970 for the quarter ended July 31, 2001. Legal & organizational
expense for the year ended July 31, 2002 was $ 38,260 as compared to $ 8,684 for
the six months ended July 31, 2001. (Due to the inception date of the company on
February 1, 2001, no comparable twelve-month period was available.) The majority
of these expenses relate to the ongoing legal costs associated with the process
of going public.

Promotion and trade show expense for the quarter ended July 31, 2002 was Nil as
compared to Nil for the quarter ended July 31, 2001. Promotion and trade show
expense for the year ended July 31, 2002 was $ 37,111 as compared to $ 72 for
the six months ended July 31, 2001. (Due to the inception date of the company on
February 1, 2001, no comparable twelve-month period was available.) The majority
of these expenses related to costs associated with traveling to trade shows and
identifying potential acquisition targets.

The above noted compensation expenses charged to Promotion and trade show
expense for the quarter ended July 31, 2002 was Nil as compared to Nil for the
quarter ended July 31, 2001. These compensation expenses charged to Promotion
and trade show expense for the year ended July 31, 2002 was $ 30,000 as compared
to Nil for the six months ended July 31, 2001. Again, as shares were exchanged
for services, these expenses charged to Promotion and trade show expense
represent no cash outlay for the Company.

Discount on shares issued expense for the quarter ended July 31, 2002 was Nil as
compared to Nil for the quarter ended July 31, 2001. Discount on shares issued
expense for the year ended July 31, 2002 was $ 74,750 as compared to Nil for the
six months ended July 31, 2001. (Due to the inception date of the company on
February 1, 2001, no comparable twelve-month period was available.) The Company
accepted and executed subscription agreements and issued 747,500 shares at $0.10
per share for cash proceeds of $74,750. These shares were issued to friends and
business associates of the original shareholder and President of the Company. In
accordance with SEC staff policy on valuing shares in the first year prior to an
IPO these shares are deemed to be issued at $0.20 per share resulting in a $0.10
per share discount. This amount, totaling $74,750, was charged to operations.

Web site development expense for the quarter ended July 31, 2002 was $ 4,557 as
compared to Nil for the quarter ended July 31, 2001. Web site development
expense for the year ended July 31, 2002 was $ 11,891 as compared to Nil for the
six months ended July 31, 2001. (Due to the inception date of the company on
February 1, 2001, no comparable twelve-month period was available.) This expense
represents the amortization of web site development costs.

















Form 10KSB                                                              Page 5
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LIQUIDITY AND CAPITAL RESOURCES:

For the year ended July 31, 2002, cash used by operating activities was $125,391
and was primarily associated with Audit fees of $ 7,675; Consulting wages paid
out of $ 81,870; Legal and organizational costs of $ 38,260; and Promotion and
trade shows costs paid out of $7,111; which was offset by an increase in
accounts payable and accrued liabilities of $ 8,823.

For the year ended July 31, 2001, cash used by operating activities was $26,244
and was primarily associated with Audit fees of $ 2,000; Consulting wages paid
out $15,675; and Legal and organizational costs of $8,684; which was offset by
an increase in accounts payable of $ 195.

Cash provided by financing activities was $ 78,496 for the year ended July 31,
2002, compared to $ 100,000 for the six months ended July 31, 2001. Cash
provided by financing activities for the year ended July 31, 2002 was generated
through the sale of common shares of $ 74,750, ($ 100,000 for the six months
ended July 31, 2001); and through advances from a related party in the amount of
$ 3,746, (Nil for the six months ended July 31, 2001).

Cash used by investing activities was $ 5,028 for the year ended July 31, 2002,
compared to Nil for the year ended July 31, 2001. Cash used by investing
activities for the year ended July 31, 2002 was used to purchase capital assets
totaling $1,028 and to purchase a web site for $4,000.

The Company currently has $21,833 cash in its bank account. The Company is
pursuing multiple growth strategies for its adult business including an expanded
marketing effort to generate more revenue from its existing sites and the
possibility of acquiring an existing revenue generating business.


































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ITEM 7.  FINANCIAL STATEMENTS
-----------------------------

Growth Mergers, Inc.

(A Development Stage Company)


                                                                         Index

Independent Auditors' Report..............................................F-1

Consolidated Balance Sheets...............................................F-2

Consolidated Statements of Operations.....................................F-3

Consolidated Statements of Cash Flows.....................................F-4

Consolidated Statement of Stockholders' Equity............................F-5

Notes to the Consolidated Financial Statements............................F-6



































Form 10KSB                                                              Page 7
<PAGE>





                                      _ _
                                     | | |
                                     |_|_|
                                     |_|_|


M A N N I N G    E L L I O T T            | 11th floor, 1050 West Pender Street,
                                          | Vancouver, BC, Canada V6E 3S7
                                          | Phone: 604.714.3600
                                          | Fax: 604.714.3669
C H A R T E R E D   A C C O U N T A N T S | Web: manningelliott.com


                          Independent Auditors' Report
                          ----------------------------

To the Stockholders and the Board of Directors
of Growth Mergers, Inc.
(A Development Stage Company)

We have audited the accompanying consolidated balance sheets of Growth Mergers,
Inc. (A Development Stage Company) as of July 31, 2002 and 2001 and the related
consolidated statements of operations, stockholders' equity and cash flows for
the period from February 1, 2001 (Date of Inception) to July 31, 2002, year
ended July 31, 2002 and the period from February 1, 2001 (Date of Inception) to
July 31, 2001. These consolidated financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
consolidated financial statements based on our audits.


We conducted our audits in accordance with U.S. generally accepted auditing
standards. 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.


In our opinion, the aforementioned consolidated financial statements present
fairly, in all material respects, the financial position of Growth Mergers, Inc.
(A Development Stage Company), as of July 31, 2002 and 2001, and the results of
its operations and its cash flows for the period from February 1, 2001 (Date of
Inception) to July 31, 2002, year ended July 31, 2002 and the period from
February 1, 2001 (Date of Inception) to July 31, 2001, in conformity with U.S.
generally accepted accounting principles.


The accompanying consolidated financial statements have been prepared assuming
the Company will continue as a going concern. As discussed in Note 1 to the
consolidated financial statements, the Company has not generated any significant
revenues since inception. These factors raise substantial doubt about the
Company's ability to continue as a going concern. Management's plans in regard
to these matters are also discussed in Note 1. The consolidated financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.

/s/ "Manning Elliott"

CHARTERED ACCOUNTANTS

Vancouver, Canada

October 23, 2002

                                       F-1


Form 10KSB                                                              Page 8
<PAGE>




<TABLE>
<CAPTION>
Growth Mergers, Inc.
(A Development Stage Company)
Consolidated Balance Sheets
(expressed in U.S. dollars)


                                                           July 31,            July 31,
                                                             2002                2001
                                                              $                   $

                                     ASSETS

<S>                                                        <C>                    <C>
Current Assets

  Cash                                                         21,833              73,756
  Accounts receivable                                             168                   -
  Prepaid expenses (Notes 5(a) and (c))                       335,677                   -
-------------------------------------------------------------------------------------------

Total Current Assets                                          357,678              73,756

Property, Plant and Equipment (Note 3)                            874                   -

Web Site Development Costs (Note 4)                             2,500                   -
-------------------------------------------------------------------------------------------

Total Assets                                                  361,052              73,756
===========================================================================================


                      LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities

  Accounts payable                                              6,518                 195
  Accrued liabilities                                           2,500                   -
  Due to related party (Note 5)                                 3,746                   -
-------------------------------------------------------------------------------------------

Total Current Liabilities                                      12,764                 195
-------------------------------------------------------------------------------------------

Stockholders' Equity

Common Stock (Note 6): 100,000,000 common shares
authorized with a par value of $0.001; 11,823,500
and 10,000,000 issued and outstanding respectively             11,824              10,000

Additional Paid-in Capital                                  1,402,876              90,000
-------------------------------------------------------------------------------------------

                                                            1,414,700             100,000

Deficit Accumulated During the Development Stage           (1,066,412)            (26,439)
===========================================================================================

Total Stockholders' Equity                                    348,288              73,561
===========================================================================================

Total Stockholders' Equity and Liabilities                    361,052              73,756
===========================================================================================
</TABLE>


Contingent Liability (Note 1)







                                       F-2


Form 10KSB                                                              Page 9
<PAGE>




<TABLE>
<CAPTION>
Growth Mergers, Inc.
(A Development Stage Company)
Consolidated Statements of Operations
(expressed in U.S. dollars)


                                                  Accumulated from                        Accumulated from
                                                  February 1, 2001        For the         February 1, 2001
                                                 (Date of Inception)     Year Ended      (Date of Inception)
                                                  to July 31, 2002     July 31, 2002      to July 31, 2001
                                                         $                   $                   $

Revenue                                                    1,027               1,027                   -
------------------------------------------------------------------------------------------------------------


Expenses

<S>                                                   <C>                 <C>                 <C>
  Accounting and audit                                     9,675               7,675               2,000
  Amortization of property, plant and equipment              154                 154                   -
  Bank charges                                               166                 158                   8
  Consulting fees and wages (Notes 5 and 7)              886,676             871,001              15,675
  Discount on shares issued (Note 7(b))                   74,750              74,750
  Legal and organizational                                46,944              38,260               8,684
  Promotion and trade shows (Note 7)                      37,183              37,111                  72
  Web site development (Note 7)                           11,891              11,891                   -
------------------------------------------------------------------------------------------------------------

                                                       1,067,439           1,041,000              26,439
------------------------------------------------------------------------------------------------------------

Net Loss for the Period                               (1,066,412)         (1,039,973)            (26,439)
============================================================================================================


Net Loss Per Share - Basic                                                     (0.09)              (0.01)
============================================================================================================


Weighted Average Shares Outstanding                                       11,292,000          10,000,000
============================================================================================================
</TABLE>


(Diluted loss per share has not been presented as the result is anti-dilutive)






















                                       F-3


Form 10KSB                                                              Page 10
<PAGE>




<TABLE>
<CAPTION>
Growth Mergers, Inc.
(A Development Stage Company)
Consolidated Statements of Cash Flows
(expressed in U.S. dollars)


                                                         Accumulated from                        Accumulated from
                                                         February 1, 2001         For the        February 1, 2001
                                                        (Date of Inception)     Year Ended      (Date of Inception)
                                                         to July 31, 2002     July 31, 2002      to July 31, 2001
                                                                $                   $                   $

Cash Flows To Operating Activities

<S>                                                          <C>                 <C>                    <C>
Net loss                                                     (1,066,412)         (1,039,973)            (26,439)

Adjustments to reconcile net loss to cash

  Amortization of property, plant and equipment                     154                 154                   -
  Amortization of website development costs                       1,500               1,500                   -
  Stock based compensation                                      904,273             904,273                   -

Changes in non-cash working capital items

  Increase in accounts receivable                                  (168)               (168)                  -
  Increase in accounts payable and accrued liabilities            9,018               8,823                 195
-----------------------------------------------------------------------------------------------------------------

Net Cash Used In Operating Activities                          (151,635)           (125,391)            (26,244)
-----------------------------------------------------------------------------------------------------------------

Cash Flows From Financing Activities

  Advances from a related party                                   3,746               3,746                   -
  Common shares issued                                          174,750              74,750             100,000
-----------------------------------------------------------------------------------------------------------------

Net Cash Provided By Financing Activities                       178,496              78,496             100,000
-----------------------------------------------------------------------------------------------------------------

Cash Flows To Investing Activities

  Purchase of property, plant and equipment                      (1,028)             (1,028)                  -
  Website development costs                                      (4,000)             (4,000)                  -
-----------------------------------------------------------------------------------------------------------------

Net Cash Used in Investing Activities                            (5,028)             (5,028)                  -
-----------------------------------------------------------------------------------------------------------------

Increase (Decrease) in Cash                                      21,833             (51,923)             73,756

Cash - Beginning of Period                                            -              73,756                   -
-----------------------------------------------------------------------------------------------------------------

Cash - End of Period                                             21,833              21,833              73,756
=================================================================================================================
Non-Cash Financing Activities

  Stock based compensation                                    1,239,950           1,239,950                   -
=================================================================================================================

Supplemental Disclosures

  Interest paid                                                       -                   -                   -
  Income taxes paid                                                   -                   -                   -
=================================================================================================================
</TABLE>








                                       F-4


Form 10KSB                                                              Page 11
<PAGE>




<TABLE>
<CAPTION>
Growth Mergers, Inc.
(A Development Stage Company)
Consolidated Statement of Stockholders' Equity
From February 1, 2001 (Date of Inception) to July 31, 2002
(expressed in U.S. dollars)


                                                                                                              Deficit
                                                                                                            Accumulated
                                                                            Additional                       During the
                                                 Common Stock                Paid-in                        Development
                                            Shares           Amount          Capital           Total            Stage
                                              #                 $               $                $                $

<S>                                       <C>                  <C>           <C>              <C>             <C>
Balance - February 1, 2001 (Date of
Inception)                                         -                -                -                -                -

  Stock issued for cash at $0.01 per
  share                                   10,000,000           10,000           90,000          100,000                -

Net loss for the period                            -                -                -                -          (26,439)
--------------------------------------------------------------------------------------------------------------------------

Balance - July 31, 2001                   10,000,000           10,000           90,000          100,000          (26,439)

  Stock repurchased and evidenced
  by a note payable (Note 6(a))           (5,000,000)          (5,000)         (45,000)         (50,000)               -

  Stock issued at $0.20 per share for
  a $50,000 note receivable and
  compensation for services rendered
  or to be rendered (Note 6(a))            5,000,000            5,000          995,000        1,000,000                -

  Stock issued for cash at $0.10 per
  share plus a $0.10 per share
  discount (Note 6(b))                       747,500              748          148,752          149,500                -

  Stock issued at $0.20 per share for
  services rendered or to be rendered
  (Note 6(c))                              1,076,000            1,076          214,124          215,200                -

Net loss for the year                              -                -                -                -       (1,039,973)
--------------------------------------------------------------------------------------------------------------------------

Balance - July 31, 2002                   11,823,500           11,824        1,402,876        1,414,700       (1,066,412)
==========================================================================================================================
</TABLE>
















                                       F-5


Form 10KSB                                                              Page 12
<PAGE>






1.   Nature of Operations and Continuance of Business

     The  Company was  incorporated  in the state of Nevada on February 1, 2001.
     The  Company's  head  operational  office is  located in  Vancouver,  B.C.,
     Canada.

     The Company owns and operates online adult entertainment websites and began
     operations on October 19, 2001. The Company's business plan is to develop a
     series of websites  offering adult oriented  content and services to a wide
     geographic and demographic customer base over the Internet.

     The  Company is in the  development  stage and will  continue  to be in the
     development  stage until the Company  receives  significant  revenues  from
     operating its websites.  Although planned principal  activities have begun,
     the Company has not received  significant  revenue.  In a development stage
     company,  management  devotes most of its activities in developing a market
     for its online  services.  The  ability of the  Company to emerge  from the
     development stage with respect to its planned  principal  business activity
     is dependent upon its ability to attain profitable operations.  There is no
     guarantee that the Company will be able to attain  profitability.  There is
     substantial  doubt  regarding the Company's  ability to continue as a going
     concern.

     The Company's  SB2  Registration  Statement  was declared  effective by the
     United States Securities and Exchange Commission.

2.   Summary of Significant Accounting Principles

     a)   Basis of Accounting

          These  consolidated  financial  statements  are prepared in conformity
          with accounting principles generally accepted in the United States and
          are  presented  in US  dollars.  There are no  consolidated  financial
          statements  prepared  using  Canadian  generally  accepted  accounting
          principles;  however,  there  would be no material  reconciling  items
          other than presentation items.

     b)   Consolidation

          These financial statements include the accounts of the Company and its
          wholly owned US subsidiary,  Adult Mergers,  Inc. a Nevada corporation
          incorporated on March 8, 2001.

     c)   Fiscal Year

          The Company's fiscal year end is July 31.

     d)   Cash and Cash Equivalents

          The Company considers all highly liquid instruments with a maturity of
          three months or less at the time of issuance to be cash equivalents.

     e)   Property, Plant and Equipment

          Property,  plant and  equipment  is stated  at cost.  Amortization  is
          computed on a 30% declining balance basis.

     f)   Web Site Development Costs

          The Company charges  predevelopment web site costs to operations until
          the web site is technically feasible. Development of its web sites are
          then capitalized until commercially operational at which time deferred
          development  costs are amortized to operations over the estimated life
          of the website being two years.  Web site operating  costs are charged
          to operations as incurred.



                                       F-6


Form 10KSB                                                              Page 13
<PAGE>






2.   Summary of Significant Accounting Principles (continued)

     g)   Foreign Currency Transactions/Balances

          Transactions  in currencies  other than the U.S. dollar are translated
          at the rate in effect on the transaction date. Any balance sheet items
          denominated in foreign  currencies are  translated  into U.S.  dollars
          using the rate in effect on the balance sheet date.  Resulting foreign
          currency  gains or losses are charged to  operations  as incurred.

     h)   Income Tax

          Potential  benefits  of income tax losses  are not  recognized  in the
          accounts  until  realization  is more likely than not. The Company has
          adopted  Statement of Financial  Accounting  Standards  No. 109 ("SFAS
          109") as of its  inception.  The Company has  incurred  net  operating
          losses of $164,000,  which  expire in 2016 and 2017.  Pursuant to SFAS
          109 the  Company is required  to compute  tax asset  benefits  for net
          operating losses carried forward.  Potential  benefit of net operating
          losses have not been recognized in these financial  statements because
          the  Company  cannot be  assured  it is more  likely  than not it will
          utilize the net operating losses carried forward in future years.

          The  components  of the net  deferred  tax asset at July 31,  2002 and
          2001,  and the  statutory  tax rate,  the  effective  tax rate and the
          elected amount of the valuation allowance are scheduled below:

                                              2002                 2001
                                               $                    $

                 Net Operating Loss         138,000              26,000

                 Statutory Tax Rate           34%                  34%

                 Effective Tax Rate            -                    -

                 Deferred Tax Asset          47,000               9,000

                 Valuation Allowance        (47,000)             (9,000)
                 ----------------------------------------------------------

                 Net Deferred Tax Asset        -                    -
                 ==========================================================

     i)   Revenue Recognition

          Revenue will be  recognized in  accordance  with SEC Staff  Accounting
          Bulletin   101  ("SAB   101").   Revenue  will  consist  of  web-based
          membership, usage, advertising,  pay-per-view and E-Commerce fees paid
          by way of credit card over the Internet.  Pursuant to SAB 101 revenues
          are  recognized  after the service has been  performed  and no further
          performance obligations exist.

     j)   Accounting for Stock Based Compensation

          The  Company  has  adopted  SFAS No. 123  "Accounting  for Stock Based
          Compensation"  which  requires that stock awards  granted to employees
          and non-employees are recognized as compensation  expense based on the
          fair market value of the stock award or fair market value of the goods
          and services  received  whichever  is more  reliably  measurable.  The
          Company follows the guidance pursuant to EITF 96-18 for measurement of
          stock awards to non-employees.






                                       F-7


Form 10KSB                                                              Page 14
<PAGE>






2.   Summary of Significant Accounting Principles (continued)

     k)   Basic and Diluted Net Income (Loss) per Share

          The Company  computes net income (loss) per share in  accordance  with
          SFAS No.  128,  "Earnings  per Share"  (SFAS 128).  SFAS 128  requires
          presentation of both basic and diluted earnings per share (EPS) on the
          face of the income  statement.  Basic EPS is computed by dividing  net
          income  (loss)  available to common  shareholders  (numerator)  by the
          weighted  average  number of common shares  outstanding  (denominator)
          during the period.  Diluted EPS gives effect to all dilutive potential
          common shares  outstanding  during the period including stock options,
          using the treasury  stock method,  and  convertible  preferred  stock,
          using the if-converted  method.  In computing Diluted EPS, the average
          stock price for the period is used in determining the number of shares
          assumed  to be  purchased  from  the  exercise  of  stock  options  or
          warrants. Diluted EPS excludes all dilutive potential common shares if
          their effect is anti  dilutive.  Loss per share  information  does not
          include  the effect of the  potential  conversions  of stock  options,
          warrants  or  convertible   debentures,   as  their  effect  would  be
          anti-dilutive.

     l)   Use of Estimates

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

     m)   Financial Instruments

          The  carrying  value of cash  and  equivalents,  accounts  receivable,
          accounts  payable,  accrued  liabilities,  and  due to  related  party
          approximate  fair value due to the relatively  short maturity of these
          instruments.


3.   Property, Plant and Equipment

<TABLE>
<CAPTION>
                                                             July 31,       July 31,
                                                               2002           2001
                                             Accumulated   Net Carrying   Net Carrying
                                    Cost    Amortization      Value           Value
                                     $            $             $               $

<S>                                 <C>             <C>            <C>              <C>
     Computer equipment             1,028           154            874              -
     ==================================================================================
</TABLE>


4.   Web Site Development Costs

<TABLE>
<CAPTION>
                                                             July 31,       July 31,
                                                               2002           2001
                                             Accumulated   Net Carrying   Net Carrying
                                    Cost    Amortization      Value           Value
                                     $            $             $               $

<S>                                 <C>           <C>            <C>                <C>
      Web site development costs    4,000         1,500          2,500              -
     ==================================================================================
</TABLE>





                                       F-8


Form 10KSB                                                              Page 15
<PAGE>






5.   Related Party Transactions/Balances

     The balance due to the President of the Company is without interest and has
     no specific terms of repayment.

     The  President  of the  Company  was  paid  $56,229  (2001  -  $9,000)  for
     consulting services rendered.

     See Note 6 for stock issuances and repurchases with related parties.


6.   Capital Stock

     The Company does not have a stock option plan.  The Company issues stock to
     pay for services of non-employees.

     a)   On November 14, 2001  5,000,000  common  shares of  10,000,000  shares
          originally  issued for $100,000 cash were  repurchased  by the Company
          for $50,000  evidenced  by a note  payable.  Pursuant to an  agreement
          dated August, 2001, on November 14, 2001, 5,000,000 shares were issued
          at $0.01  per  share,  pursuant  to a  subscription  agreement,  for a
          $50,000 note receivable.  The holders of the note payable and the note
          receivable  agreed to offset the notes resulting in no economic change
          and no change to issued or stated  capital  stock.  The  excess of the
          amount paid for the  shares,  being $.01 per share,  and the  proposed
          Initial  Public  Offering Price ("IPO") of $0.20 per share was treated
          as compensation expense in accordance with SEC staff policy on valuing
          shares in the first year prior to an IPO. The consultants  contract is
          a one-year  contract  starting November 14, 2001 extending to November
          14,  2002.  The  compensation  expense of $950,000  will be charged to
          operations over the one-year period beginning November 14, 2001. As at
          July 31,  2002 a total of  $672,917  was  charged  to  operations  and
          $277,083 was prepaid  which will be charged to operations at a rate of
          $79,167 per month.

     b)   On November 20, 2001 the Company  accepted  and executed  subscription
          agreements  and  issued  747,500  shares  at $0.10  per share for cash
          proceeds of $74,750.  These shares were issued to friends and business
          associates of the original  shareholder  and President of the Company.
          In  accordance  with SEC staff  policy on valuing  shares in the first
          year prior to an IPO these shares are deemed to be issued at $0.20 per
          share resulting in a $0.10 per share discount. This amount,  totalling
          $74,750,  was charged to operations  in November 2001 as  compensation
          expense.


     On November 29, 2001 1,076,000  shares were issued  pursuant to Rule 506 of
     Regulation  D and  Regulation  S for  services  rendered or to be rendered.
     These  shares were valued at $0.20 per share in  accordance  with SEC staff
     policy on valuing  shares in the first year prior to an IPO or  $215,200 in
     total. Of these shares:  850,000 were issued for CFO or directors' services
     to be rendered  between  November  20, 2001 to November  20,  2002;  76,000
     shares were issued to consultants  for website  development  for the period
     from November 20, 2001 to November 20, 2002 and 150,000  shares were issued
     to a consultant  providing  trade show services for the period  February 1,
     2001 to February 28, 2002.  An amount of $22,500 was accrued to October 31,
     2001 with  respect to trade show  services.  This amount was settled by the
     issuance of shares on  November  29,  2001.  As at July 31, 2002 a total of
     $156,606  was  charged to  operations  and  $58,594 was prepaid and will be
     charged to operations at approximately  $15,000 per month over the terms of
     the prepaid contracts with directors and consultants.







                                       F-9


Form 10KSB                                                              Page 16
<PAGE>

                                        ^
---------------------------------------/|\  G R O W T H   M E R G E R S  INC.
----------------------------------------|
---------------------------------------_|_/
                                      /


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

None.


PART III
--------

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

Set forth below is certain information concerning each person who was an
executive officer or a director of the Company as of July 31, 2002. All officers
and directors hold office until their respective successors are elected and
qualified, or until their earlier resignation or removal.

<TABLE>
<CAPTION>
Name                           Age   Title                        Term  Service
---------------------------   ----   --------------------------   ----------------

<S>                            <C>   <C>                          <C>
Winston Barta                  31    President, Chief Executive   1 year 19 months
Vancouver, British Columbia          Officer and Director
Canada

Chase Norlin                   34    Director                     1 year 12 months
Seattle, Washington
USA

Graham Hunter                  31    Director                     1 year 12 months
Los Gatos, CA
USA
</TABLE>

Winston V. Barta
----------------

Growth Mergers, President, Chief Executive Officer and Director 02/01 - present
GlobalMedia.com, Founding Partner, Director & Vice President of Business
Development, 11/96 to 02/01
Starnet Communications, Vice President of Marketing, 07/95 to 07/96

Mr. Barta has worked for several publicly traded Internet companies and was
instrumental in both completing the public filings and securing financing for
his previous venture, Globalmedia.com, GLMC. As the third founding partner and
Vice President of Business Development for Globalmedia.com, Mr. Barta was the
lead on completing all initial public filings and road show financing
presentations as well as managing major strategic relationships and two
multi-million dollar acquisitions. Mr. Barta also served as a Director from the
time of the company's initial listing on the OTC:BB through its advancement to a
National Market listing. Prior to working with Globalmedia.com, Mr. Barta was
Vice President of Marketing for Starnet Communications, SNMM, which specialized
in online adult entertainment and marketing. While at Starnet, Mr. Barta was
responsible for marketing and new business development for the online adult
entertainment division as well as assisting in raising capital. Mr. Barta has a
Bachelor of Commerce degree from Concordia University in Montreal and a Masters
of Business Administration from Simon Fraser University in Vancouver.

Chase Norlin
------------

ShareYourWorld, Inc., President, 4/99-present
Corbis Corp., Internet Marketing Manager, 8/98-4/99
Sony Information Technologies of America, Internet Marketing Specialist,
9/96-6/98
University of Chicago - M.A., Student, 8/95-6/96
Cohesive Systems Inc., Internet Business Development Manager, 9/94-7/95

Mr. Norlin founded ShareYourWorld in August, 1999 and built it into the largest
user-generated image clearinghouse on the Internet. Prior to ShareYourWorld, Mr.
Norlin held both business development and marketing positions at Corbis



Form 10KSB                                                              Page 17
<PAGE>

                                        ^
---------------------------------------/|\  G R O W T H   M E R G E R S  INC.
----------------------------------------|
---------------------------------------_|_/
                                      /


Corporation and Sony Information Technologies of America, managed the Internet
launch of Sony's SuperSlim line of VAIO laptops, and developed Sony's first
online imaging service (The Image Studio). Mr. Norlin's past experiences include
managing Internet business development at Cohesive Systems (acquired by Cisco),
providing networking and communications systems support at Stanford University's
BARRNet, and training at Paradigm, Inc, a Hollywood-based talent and literary
agency. Mr. Norlin, who has a BA from the University of California, Berkeley and
a Masters from the University of Chicago, is also the founder of Tech Views, the
Pacific Northwest's premier technology networking event series produced in
partnership with Goldman Sachs.

Graham Hunter
-------------

Senior Manager, Business Development, Hyperion Solutions from 10/01 - present;
Senior Principal Consultant, AlphaBlox from 08/99 - 10/01;
Senior Principal Consultant, Hyperion Solutions from 10/97 - 08/99;
Consultant, Comshare from 04/96 - 10/97;
Senior Statistical Analyst, Campbell Goodell Market Research from 04/95 to 04/96

For the past six years, Mr. Hunter has worked at the leading edge of enterprise
analytical database technologies. He has architected and built analytical
solutions used by the top managers and executives of several Fortune 500
companies including Boeing, Motorola, McDonald's, Coca-Cola, Gillette, Credit
Suisse First Boston, Deutsche Bank, and Citicorp. These systems are cover a
diverse set of applications including manufacturing cost management,
enterprise-level budgeting, advertising planning and forecasting, and global
profit optimization.

His current specialty is Java 2 Enterprise Edition (J2EE) design and
architecture, and he manages multiple web-based J2EE analytical product
offerings for the leading analytical database and infrastructure company,
Hyperion Solutions. He is based in Silicon Valley.

Mr. Hunter has a Master's degree in Business Administration from Simon Fraser
University in Burnaby, BC and a Bachelor of Commerce from the University of
Calgary.


ITEM 10.  EXECUTIVE COMPENSATION
--------------------------------

The company's current directors and officers receive no compensation other
Winston Barta who gets paid a consulting fee last year of $56,229 for being the
President of the Company. The Company has no stock option plan and no shares
were issued to the directors and officers in addition to what was registered on
the Company's initial SB-2 registration statement.

There are no current employment agreements between the Company and its executive
officers.

There are no annuity, pension or retirement benefits proposed to be paid to
officers, directors or employees of the Corporation in the event of retirement
at normal retirement date pursuant to any presently existing plan provided or
contributed to by the Corporation or any of its subsidiaries, if any.


ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
------------------------------------------------------------------------

The following table sets forth, as of November 12, 2002, certain information as
to shares of the common stock owned by (i) each person known by management to
beneficially own more than 5% of the outstanding common stock, (ii) each of the
Company's directors, and (iii) all executive officers and directors of the
Company as a group:






Form 10KSB                                                              Page 18
<PAGE>
                                        ^
---------------------------------------/|\  G R O W T H   M E R G E R S  INC.
----------------------------------------|
---------------------------------------_|_/
                                      /

                            AMOUNT AND NATURE                PERCENT OF
NAME AND ADDRESS        OF BENEFICIAL SHARES OWNED      OUTSTANDING OWNERSHIP
-----------------       --------------------------      ---------------------

Winston Barta.(1)         5,000,000 Common Shares                47.6%

Dan MacMullin(2)          5,000,000 Common Shares                47.6%

Chad DeGroot(3)              10,000 Common Shares                  *

Chase Norlin(4)             50,000  Common Shares                  *

Rob Fuller(5)              750,000  Common Shares                6.26%

Roger Williams(6)           10,000  Common Shares                  *

Graham Hunter(7)           50,000   Common Shares                  *

     (1)  Mr. Winston Barta, of Vancouver, British Columbia, Canada, an officer
          and director of the Registrant owns his 5,000,000 common shares
          through Express Enterprises Ltd, a Nevis corporation.

     (2)  All of the issued and outstanding shares of IFG Investments Services
          Inc. are owned by IFG Trust Services Inc., which in turn is owned by
          International Financial Group Inc., a foreign reporting public
          company. Mr. Dan MacMullin, Senior Vice President, International
          Financial Group Inc. beneficially own 99% of International Financial
          Group, Inc.

     (3)  Mr. Chad DeGroot, Victoria, British Columbia, Canada is the Director
          of Technology for the Company.

     (4)  Mr. Chase Norlin, Seattle, Washington, USA is a Director of the
          Company.

     (5)  Mr. Rob Fuller, Nanaimo, British Columbia, Canada is Chief Financial
          Officer.

     (6)  Mr. Williams, Vancouver, British Columbia, Canada is the Director of
          Human Resources.

     (7)  Mr. Graham Hunter, Los Gatos, California, USA is a Director of the
          Company.


*    Less than 1%


ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
--------------------------------------------------------

We intend that any transactions between the company and our officers, directors,
principal stockholders, affiliates or advisors will be on terms no less
favorable to us than those reasonably obtainable from third parties. To date
there have been no related party transactions between us and a third party other
than we have paid consulting fees to Mr. Winston Barta, the sole shareholder of
Express Enterprise Ltd., which owns 46.7% of the company's common stock.

Mr. Barta, through Express Enterprise Ltd., initially capitalized the company by
purchasing 10,000,000 shares of our common stock for $100,000. We consider these
shares to be founder's stock. On November 14, 2001 he allowed the company to
repurchase 5,000,000 of those shares from Express Enterprise Ltd. for a total
payment of $50,000. We paid for the repurchase of shares by issuing a promissory
note for $50,000 payable to Express.

IFG Investment Services Inc. paid for their shares by issuing a promissory note
to the company for $50,000.

The company then repaid Express Enterprises Ltd. the $50,000 it owed to it by
transferring the promissory note issued by IFG Investments Services Inc. to the
Company to Express Enterprises Ltd.

The purpose of this transaction was to have Express Enterprises Ltd. and IFG
Investments Services Inc. equal partners without increasing the float in the
company to 20,000,000 shares.


ITEM 13.  EXHIBITS AND REPORTS ON FORM 8-K
------------------------------------------

(a)  The following exhibits are filed as part of this report:

Form 10KSB                                                              Page 19
<PAGE>

                                        ^
---------------------------------------/|\  G R O W T H   M E R G E R S  INC.
----------------------------------------|
---------------------------------------_|_/
                                      /


None.

(b)  No reports on Form 8-K were required to be filed during the last quarter of
the period covered by this report.



                                   SIGNATURES
                                   ----------

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Company has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.




Growth Mergers, Inc.
--------------------


/s/ Winston Barta               President and Director
----------------------
Mr. Winston Barta


/s/ Mr. Chase Norlin            Director
----------------------
Mr. Chase Norlin


/s/ Mr. Graham Hunter           Director
----------------------
Mr. Graham Hunter


Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the Company and in
the capacities and on the dates indicated.


/s/ Winston Barta               President and Director
----------------------
Mr. Winston Barta


/s/ Mr. Chase Norlin            Director
----------------------
Mr. Chase Norlin


/s/ Mr. Graham Hunter           Director
----------------------
Mr. Graham Hunter











Form 10KSB                                                              Page 20