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


                                   FORM 10-QSB
                                  -------------


           [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934
                       For the quarter ended June 30, 1998

                                       OR

          [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934
                        Commission file number 33-30365-C
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                        EMERALD CAPITAL INVESTMENTS, INC.
           (Name of Small Business Issuer as specified in its charter)


               Delaware                                 36-3693936
           ---------------                             -----------
    (State or other jurisdiction of                  (I.R.S. employer
     incorporation or organization                    identification No.)



                330 East Main Street, Suite 206 Barrington, IL 60010
               ------------------------------------------------------
                      (Address of principal executive offices)


          Registrant's telephone no., including area code: (847) 382-1100
         -----------------------------------------------------------------


                                       N/A
                                     -------
          Former name, former address, and former fiscal year, if changed 
                               since last report.


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

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



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

Common  Stock  outstanding  at August 13, 1998 -  6,608,698  shares of $.001 par
value Common Stock.


                     DOCUMENTS INCORPORATED BY REFERENCE: NONE

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                                 FORM 10-QSB

                      FINANCIAL STATEMENTS AND SCHEDULES
                       EMERALD CAPITAL INVESTMENTS, INC.


                      For the Quarter ended June 30, 1998


      The following  financial  statements  and schedules of the  registrant are
submitted herewith:


                        PART I - FINANCIAL INFORMATION
                                                                     Page of
                                                                   Form 10-QSB
                                                                  -------------

Item 1Financial Statements:

            Balance Sheet--June 30, 1998                                     3

            Statements of Operations--for the six months
            ended June 30, 1998 and June 30, 1997                            4

            Statements of Cash Flows--for the six months
            ended June 30, 1998 and June 30, 1997                            5
            Notes to Financial Statements                                    6

Item 2Management's Discussion and Analysis of Financial Condition
      and Results of Operations                                              7


                          PART II - OTHER INFORMATION

                                                                          Page

Item 1.     Legal Proceedings                                               10
Item 2.     Changes in the Securities                                       10
Item 3.     Defaults Upon Senior Securities                                 10
Item 4.     Results of Votes of Security Holders                            10
Item 5.     Other Information                                               10
Item 6(a).  Exhibits                                                        10
Item 6(b).  Reports on Form 8-K                                             10

                                      2

<PAGE>




                       EMERALD CAPITAL INVESTMENTS, INC.
                        (A Development Stage Company)

                                Balance Sheet

                                June 30, 1998
                                 (Unaudited)


Assets
Current assets - cash                                                $1,567
                                                                  =============

Liabilities and Stockholders' Equity
Current liabilities
Stockholders' equity:                                                    $0
                                                                  -------------
   Common Stock - $.001 par value.
          100,000,000 shares authorized
          6,608,698 shares issued and outstanding,                    
            respectively                                              6,609
   Additional paid-in capital                                     2,607,856
   Retained deficit                                              (2,612,898)
                                                                 --------------

           Total stockholders' equity:                                1,567
                                                                 --------------
             Total liabilities and stockholders' equity              $1,567
                                                                 ==============












See accompanying Notes to Financial Statements.

                                      3

<PAGE>



                      EMERALD CAPITAL INVESTMENTS, INC.
                        (A Development Stage Company)

                           Statement of Cash Flows

                                June 30, 1998
                                 (Unaudited)


                                            Six months Ended
                                                 June 30
                                                                   Cumulative
                                          1998          1997         Amounts
                                          ----          ----         -------
Cash flows from operating activities:
      Net loss                           (5,706)       (3,688)       (29,768)
                                             
   Decrease in accounts receivable          -             -           30,000
   Decrease in accounts payable          (8,000)          -           (6,665)
                                       -----------   -----------   ------------
             Net cash used in
             operating activities        (5,706)       (3,688)        (6,433)
                                       -----------   -----------   ------------
                                                                          
Cash flows from investing activities        -             -              -
Cash flows from financing activities      8,000           -            8,000
                                       -----------   ------------  ------------
      Net (decrease) increase in cash       -          (3,688)         1,567
Cash, beginning of period                 7,273        12,737            -
                                       -----------   ------------  ------------
Cash, end of period                    $  1,567      $  9,049       $  1,567
                                       ===========   ============  ============












See accompanying Notes to Financial Statements.

                                      4

<PAGE>



                       EMERALD CAPITAL INVESTMENTS, INC.
                         (A Development Stage Company)

                            Statement of Operations

                                 June 30, 1998
                                  (Unaudited)




                                          Six months Ended
                                              June 30
                                                                    Cumulative
                                             1998         1997        Amounts
                                             ----         ----      -----------
Revenue                                       -             -
Selling, general and administrative         5,706         3,688       29,768
                                         -----------   -----------  -----------
      Loss from continuing operations      (5,706)       (3,688)     (29,768)
      Net loss                             (5,706)       (3,688)     (29,768)
                                         ===========   ===========  ===========
      Net loss per share                    $(.00)        $(.00)       $(.00)
                                         ===========   ===========  ===========
Weighted average number of shares
outstanding                               6,608,698     6,608,698    6,608,698
                                         ===========   ============ ===========

















See accompanying notes to financial statements.

                                      5

<PAGE>



                       EMERALD CAPITAL INVESTMENTS, INC.
                         (A Development Stage Company)

                        Notes for Financial Statements


(1)         The unaudited  financial  statements include the accounts of Emerald
            Capital Investments,  Inc., and include all adjustments  (consisting
            of normal  recurring items) which are, in the opinion of management,
            necessary to present  fairly the  financial  position as of June 30,
            1998 and the results of operations for the six months ended June 30,
            1998 and 1997, cash flows for the six months ended June 30, 1998 and
            1997 and cumulative amounts since inception of the development stage
            through June 30, 1998.  The results of operations for the six months
            ended June 30, 1998 are not necessarily indicative of the results to
            be expected for the entire year.

(2)         Income  (loss) per  common  share is based on the  weighted  average
            number of shares outstanding during the period.







                                      6

<PAGE>



                                    ITEM 2

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

General

      The Company  currently has no operations.  Prior to December 29, 1995, the
Company had been involved in the business of recycling used tires and designing,
manufacturing,  and marketing shredding equipment.  The Company's tire recycling
and shredding  equipment  operations were unsuccessful and the Company generated
significant  losses during 1994 and 1995.  During 1995,  the Company  funded its
operations  with  loans  from  a  commercial  bank  from  management  and  other
individuals.  By November  1995,  the Board of Directors had concluded  that the
Company did not have the capital,  or the ability to obtain capital necessary to
continue its current  operations.  The  Company's  Board of Directors  initiated
efforts to sell the Company's WRTI and CTR  operations.  The Company was able to
interest one of its directors and several other  individuals in purchasing  WRTI
and CTR.

      Effective  December 29,  1995,  the Company sold all of its shares of WRTI
and CTR for  $30,000  and the payment and or  assumption  of  liabilities.  As a
result of such sale, the Company's total liabilities,  on a consolidated  basis,
decreased from $1,758,308 to $6,665.

      On May 7, 1998,  the Company  entered into an Agreement and Plan of Merger
to acquire American Polymer Corporation, a Utah Corporation.  The Merger will be
a reverse merger whereby  following the Merger,  the shareholders and management
of American  Polymer will be the controlling  shareholders and Management of the
Company.  The  Merger  is  subject  to  several  conditions  and there can be no
assurance that it will be completed.

 Financial Condition

       Total assets at June 30, 1998 were $1,567, all of which was cash. At June
30, 1998, the Company had no  liabilities.  The Company intends to use such cash
to pay for various filing fees and  professional  fees relating to its reporting
obligations  and to fund the costs  which may arise from  seeking  new  business
opportunities.

      It is likely that the Company will be required to raise additional capital
in order to  attract  any  potential  acquisition  partner  but  there can be no
assurance that the Company will be able to raise any additional  capital.  It is
also likely that any future  acquisition  will be made  through the  issuance of
shares of the  Company's  common  stock which will result in the dilution of the
percentage ownership of the current shareholders.

Results of Operations

     The  Company  has  generated  no  revenues  since the sale of the  WRTI/CTR
operations  and assets.  The Company will not generate  any  revenues,  if ever,
until and  unless it  merges  with an  operating  company  or raises  additional
capital for its own  operations.  There can be no assurance  that either of such
events will happen.


                                      7

<PAGE>



      The  Company  had a net loss of $5,706 for the six  months  ended June 30,
1998 compared to $3,688 for the six months ended June 30, 1997.

Plan of Operation

      Commencing in the fourth  quarter of 1995, the Company's Plan of Operation
was essentially the plan to sell its WRTI and CTR operation.  Effective December
29, 1995 these operations were sold. The Company's  current plan of operation is
to acquire another operating company.  It is likely that any acquisition will be
a "reverse merger"  acquisition whereby the Company acquires a larger company by
issuing shares of the Company's  common stock to the  shareholders of the larger
company.  Although the Company would be the  surviving or parent  company from a
corporate law  standpoint,  the  shareholders of the larger company would be the
controlling  shareholders of the Company and the larger company would be treated
as the survivor or parent  company from an  accounting  point of view. It can be
expected that any company which may desire to be acquired by the Company will do
so as a method of  potentially  becoming a public  company more quickly and less
expensively than if such company undertook its own public offering.

      The  Company has  entered in to a Merger  Agreement  to acquire by merger,
American Polymer Corporation,  a small specialty chemical company. The Merger is
subject to numerous  conditions,  including a requirement that the Company raise
additional capital.  There can be no assurance that the Merger will be effected.
A general description of the Merger is as follows:

Overview of the Merger

      The Merger Agreement  provides that, subject to the approval of the Merger
Agreement  by the  shareholders  of both the Company and American  Polymer,  the
satisfaction or waiver of certain other conditions,  the Merger will be effected
and Emerald Merger Sub, a wholly-owned subsidiary of the Company, will be merged
with and into  American  Polymer,  which will be the Surviving  Corporation  and
which will be a wholly-owned  subsidiary of the Company.  American  Polymer will
continue to conduct its current business.

      The Company will, prior to the Merger,  effect a 1-for-10 reverse split of
its issued and outstanding  shares of common stock. The 6,608,698 shares will be
reduced to approximately 660,869 shares as the result of the reverse split.

      At the effective time ("Effective  Time") of the Merger, all of the issued
and  outstanding  shares of American  Polymer will be converted  into a total of
9,243,476 shares  (calculated after the 1-for-10 reverse split) of the Company's
common  stock.  Further  more,  all  outstanding  options to purchase  shares of
American  Polymer  will be  converted  into  options to  purchase  shares of the
Company on the same conversion basis and ratio as each share of American Polymer
is converted into shares of the Company.

Reasons for the Merger

      The Company is currently an inactive  company  whose  business  plan is to
seek a suitable merger partner.  The Company's  reason for  participating in the
Merger is to enable it to  commence  active  business  operations  in a business
which  management  believes (1) has potential for  long-term  growth;  (2) has a
proven

                                      8

<PAGE>



product in place;  (3) has experienced  management in place; and (4) is involved
in an industry which holds interest for product users,  government  agencies and
investors.

      American   Polymer  has   informed   the  Company   that  its  reason  for
participating in the Merger is (1) to obtain additional working capital;  (2) to
have potential access to public markets for its shareholders  thereby  providing
liquidity for their investment; (3) to facilitate future capital raising efforts
to the extent necessary, (4) to enable it to provide incentives to employees and
product  distributors with stock options;  and (5) to reduce ownership  dilution
which may result if American  Polymer  were to have  undertaken  its own initial
public offering.

Share Ownership Following Merger

      If the Merger is completed,  the following  shares of the Company's Common
Stock will be issued and outstanding:

                                    Maximum Offering  Minimum Offering*

Current Shareholders                      660,869          660,869
Offering Investors                      1,500,000        1,200,000
American Polymer Shareholders           9,243,476        9,243,476
Placement Agent Fee Shares                150,000          120,000
------------------------------          ----------      -----------

Total                                  11,554,345       11,254,345


*The minimum offering may be reduced upon the agreement of the parties.


Accounting Treatment

      It is expected  that the Merger will be treated as a reverse  merger using
the purchase method of accounting.  However, since the Company is a public shell
with minimum activity, no good will be recorded.

Federal Tax Consequences

      The  Merger is  intended  to  qualify as a  reorganization  under  Section
368(a)(1)(A)  of the  Internal  Revenue  Code of  1986,  as  amended,  and if so
qualified,  will not result in the recognition of any gain or loss by either the
Company,  American Polymer,  or the shareholders of either.  Neither the Company
nor  American  Polymer has applied for a tax ruling with  respect to the Merger,
nor has  either  obtained  an opinion of  counsel  with  respect to the  Merger;
therefore,  no  assurances  can be given that the  expected  tax result  will be
achieved in the Merger.

Appointment of New Officers and Directors

      Following the consummation and closing of the Merger, the current officers
and directors of the Company, except for Douglas P. Morris, shall resign and the
officers and  directors of American  Polymer  shall be appointed as the officers
and  directors of the Company.  Mr. Morris will remain a director of The Company
and will be appointed The Company's Vice President of Capital Markets.


                                      9

<PAGE>

Change of Name and Possible Change of Domicile

      The  Company's  name will be changed from  "Emerald  Capital  Investments,
Inc.", to some other name chosen by American Polymer  management,  in connection
with the Merger.  In an effort to reduce state corporate  franchise  taxes,  the
Company  and  American  Polymer  may  provide  for the  change of The  Company's
domicile from the State of Delaware to the State of Utah in a change of domicile
merger.

                          PART II - OTHER INFORMATION

Item 1.        Legal Proceedings.  To the best knowledge of the Company's 
               management, the Company is not a party to any legal 
               proceeding or litigation.

Item 2.        Changes in the Rights of the Company's Security Holders.  None.

Item 3.        Defaults by the Company on its Senior Securities.  None.

Item 4.        Submission of Matters to Vote of Security Holders. No matter was 
               submitted to a vote of the Company's security holders for the 
               quarter ended June 30, 1998.

Item 5.        Other Information.

Item 6(a).     Exhibits.  Agreement and Plan of Merger

Item 6(b).     Reports on Form 8-K.  None filed.



                                          SIGNATURE


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


Dated: August 14, 1998               EMERALD CAPITAL INVESTMENTS, INC.



                                     By  /s/ Frank H. Ross, III
                                         Frank H. Ross, III
                                         President/Principal Executive Officer



                                     By   /s/ Douglas P. Morris
                                          Douglas P. Morris
                                          Principal Financial Office



                                      10