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

                                  FORM 10-KSB/A
                                 Amendment No. 1

(Mark  One)
[X]  Annual Report under Section 13 or 15(d) of the Securities Exchange Act
     of  1934

     For  the  fiscal  year  ended  March  31,  2001

[ ]  Transition  report  under  Section  13  or  15(d)  of  the Securities
     Exchange  Act  of  1934

     For  the  transition  period  from  _______________  to  ________________

     Commission  File  No.  0-25521
                            -------

                         EMERGENT FINANCIAL GROUP, INC.
                         ------------------------------
                 (Name of Small Business Issuer in its Charter)

              Delaware                                  88-0407731
              --------                                  ----------
    (State or Other Jurisdiction of                  (I.R.S. Employer
    Incorporation  or  Organization)              Identification Number)

              3550 N Central Avenue, Suite 1800, Phoenix, AZ 85012
              ----------------------------------------------------
               (Address of Principal Executive Offices) (Zip Code)

                                 (602) 279-1443
                                 --------------
                (Issuer's Telephone Number, Including Area Code)

       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 the Form 10-KSB.
[ X ]

State  issuer's  revenues  for  its  most  recent  fiscal  year:  $192,460.


                                        1
<PAGE>
     The aggregate market value of the 884,667 shares of Common Stock, $.001 par
value  per  share (the "Common Stock"), held by non-affiliates of the Registrant
as  of  August  2,  2001  was  $265,400.

     The  number  of shares outstanding of the Registrant's sole class of Common
Stock  as  of  August  2,  2001  was  918,500  shares.

                      DOCUMENTS INCORPORATED BY REFERENCE:

None.

Transitional  Small  Business  Disclosure  Format  (Check  One):

            [   ]   YES     [ X ]   NO


                                        2
<PAGE>
ITEM  1.       DESCRIPTION  OF  BUSINESS

FORWARD  LOOKING  STATEMENTS

     When  used  in this Form 10-KSB, the words or phrases "will likely result,"
"are  expected  to," "will continue," "is anticipated," "estimate," "projected,"
"intends,"  "may"  or  similar  expressions  are  intended  to identify "forward
looking  statements"  within  the  meaning  of the Private Securities Litigation
Reform  Act  of  1995.  Such  statements  are  subject  to  certain  risks  and
uncertainties, including but not limited to, lack of operating history, need for
additional  financing,  history  of  losses  and  successful  identification,
acquisition  and  integration  of  additional  target businesses.  Such factors,
which  are  discussed  in  Management's  Discussion  and  Analysis  of Financial
Condition  and  Results  of  Operations,  could affect Emergent Financial Group,
Inc.'s  ("Emergent"  or the "Company") financial performance and could cause the
Company's  actual  results  for  future  periods  to  differ materially from any
opinion  or  statements  expressed  herein with respect to future periods.  As a
result, the Company wishes to caution readers not to place undue reliance on any
such  forward-looking  statements,  which  speak  only  as  of  the  date  made.

FORMATION  AND  RECENT  HISTORY

     Emergent  was  originally  incorporated as Shanecy, Inc. in Delaware on May
31,  1994,  and was organized to act as a home health care analysis and referral
service.  On March 10, 1999, the Company filed a registration statement with the
Securities  and  Exchange  Commission  ("SEC")  in  order  to become a reporting
company.  On  November  11,  1999,  the  original  business  activities  were
discontinued.

     On  November  11, 1999, the two existing directors of Emergent resigned and
appointed  Jason  W.  Galanis  and Kevin L. Washington to replace them. Prior to
this  event, the Company was inactive and had no material assets or liabilities.
On  November  19, 1999, Harry Weitzel was appointed Chairman and Chief Executive
Officer joined by two additional Directors and on December 31, 1999, three final
appointments  were  made, bringing the total number of Directors to eight. Under
the  direction  of  its  new  board,  the Company pursued a business strategy of
internet-oriented financial services investments. Subsequently, on September 12,
2000  the  Company  determined to redefine its business plan away from financial
services  and  toward  providing  small  business  owners  with  a  range  of
Internet-based enterprise solutions (B2B), at which time Mr. Galanis resigned as
an  executive  officer  of  the  Company.  Despite  his resignation, Mr. Galanis
arranged  for  additional  equity  financing  through  the  issuance of Series D
preferred  stock  to  a  New  York-based  institutional  investor, International
Investment  Group,  which  funded  on  September  22,  2000  (see  "Management's
Discussion  and  Analysis  of  Financial  Condition  and  results of Operations-
Financial  Condition").  Beginning  in  October  2000,  the  existing management
directed  the  Company to begin to borrow funds from the Starfish Group pursuant
to  certain  notes  which  included  unsecured  notes and a series of short-term
senior  secured  promissory  notes.  The  Company  borrowed  an  aggregate  of
approximately  $3,600,000, $1,600,000 of which was received from Mr. Washington.
Based  on  numerous  factors, including an extended deterioration in the capital
markets in regards to B2B companies, the new focus of management did not attract
the  necessary  level  of funding so as to obtain funding other than the secured
notes  above  and,  as  a  consequence,  the  Company  could not sustain its B2B
business  model.  On December 31, 2000, the Company defaulted on certain secured
debt  obligations as disclosed in the Form 10Q for the period ended December 31,
2000  (also see "Management's Discussion and Analysis of Financial Condition and
results  of  Operations-  Financial  Condition").  The  defaults  also  led to a
foreclosure  on  certain assets of the Company, which consisted primarily of the
Company's interest in EAL, on February 17, 2001 (see Financial Statements) which
was  not  contested  by  prior  management.


                                        3
<PAGE>
     On  July 18, 2001, the Board of Directors adopted a new business plan which
seeks to focus on investments in niche emerging payment services companies which
pursue  strategies  in  electronically  delivered financial services.  The board
approved  a  restructuring  plan  which  it hopes will include the conversion of
approximately  $3,000,000  of  outstanding  debt  into  approximately 15% of the
Company's  outstanding  Common  Stock on a fully diluted basis, a name change of
the  company  from Inc.ubator Capital to Emergent Financial Group, Inc., and a 1
for  30  reverse  stock split of the Company's Common Stock.  In connection with
approving  the  revised  business plan at the meeting, the directors unanimously
approved  a resolution appointing Jason Galanis as President and CEO and, at the
conclusion  of  the  meeting,  directors  Weitzel  and  Pilallis  tendered their
resignations.  As  of August 8, 2001, the Company has completed the name change,
the  1  for  30  reverse  stock  split,  and  has  had  substantial  progress in
negotiations  to  convert the debt as described above, although no assurance can
be  provided  that  such  conversion  will  take  place.

THE  COMPANY

      Emergent  intends  to  acquire  technology-oriented  alternative financial
services  companies, and, to date, has completed the acquisition of Keycom, Inc.
(see  Business  Description  --  Significant  Developments).  Specifically,
management  attempts  to  identify emerging payment technologies in the non-bank
transaction  processing  and  electronic  payments  industries.  Card-based
technologies  and  services  such  as  specialized  credit  card,  debit  card,
chip-embedded  (or  'smart')  card,  other  stored-value  cards  and  various
point-of-sale  technologies  are the focal point of the investment strategy. The
business  plan  is  to  invest  in or acquire a limited number of such companies
where there exists identifiable and immediate revenue streams and where multiple
revenue streams can be generated from each location where the Company's software
is  installed.  Revenue  is currently primarily derived from receiving a fee for
providing  basic  financial  services  such  as  cash  remittance  and  prepaid
telecommunications  services.  The  Company  intends to enter the check cashing,
cash  advance  and  debit  card businesses through additional acquisitions.  The
Company  seeks  businesses  that have developed either proprietary technology or
those  employing  widely available systems. A prerequisite criterion is that the
prospective electronic payments business plan has a fee-based revenue model with
no,  or  minimal,  continuing credit or transaction risk exposure. The Company's
business  strategy  is  to  generate recurring fee-based revenue by developing a
broad  base  of  customers  who  access  our services in familiar and convenient
third-party  retail  locations.

SIGNIFICANT  DEVELOPMENTS

     On  Jul  19,  2001,  the company consummated the acquisition of 100% of the
capital  stock  of  Keycom  Inc., located in Westlake Village, California for an
aggregate  purchase  price  of  $25  million.  The  purchase  price  was paid by
issuance  of 250,000 shares of the Company's of Series E preferred stock, with a
face  value  of  $100  per  share.  Keycom has developed proprietary transaction
processing  software  called  Xtrans  (www.xtransystem.com)  which  enables data
communication  with  existing merchant credit card terminals in order to record,
transmit  and  dispatch  small  balance  cash  transmissions  nationally  and
internationally.  The system uses the Internet to transmit digitized information
regarding  cash  remitted  by a customer at the Point-of-Sale and the subsequent
delivery  of  cash  to a third party at remote locations, including locations in
foreign countries. More widely known competitors in the market providing similar
services  include  Western  Union  and  Moneygram.The  primary  market for these
services  is  comprised  of people who periodically need to send or receive cash
quickly to meet emergency situations, to send funds to family in other locations
or  to  use  non-bank financial services to pay bills or meet other obligations.
The  Company  derives its revenues from transaction processing fees and from the
investment  of  funds  received  from  the  sale  of  payment  services,  net of
commissions  paid  to  certain  selling  agents.


                                        4
<PAGE>
THE  MARKET;  OVERVIEW

     The Company currently operates in the international cash remittance service
industry,  including  prepaid  long  distance (international) telecommunications
and,  to  a lesser extent, prepaid wireless services. The competition is intense
in  each of these industries and there are a few dominant market participants in
each  industry  such  as  Western  Union  and  Moneygram  in the cash remittance
industry  and  MCI  Worldcom  and  Sprint  in  the  telecommunications industry.

     The  global  economy has created a highly mobile labor force which migrates
according  to  supply  and  demand factors. Therefore, capital flows originating
from  the  United  States  and  other  developed countries are being transferred
abroad.  The  Company  believes  that  cross border capital flows are growing at
double  digit rates annually, with the highest growth coming from the expatriate
communities  resident in the United States. These communities represent the most
modest  socio-demographic,  typically  being  moderate-income  wage  earners.
Nevertheless,  in  2000,  US$24 billion was remitted originating from the United
States  to  Central  America, the Caribbean and Mexico alone. Average individual
cash  remittances  were  less  than  $300 and occurred with bi-monthly or weekly
frequency.

     Presently,  Western  Union  and  Moneygram control most of the cross-border
cash remittance transactions. Citibank has also entered the Hispanic market with
the  $12.5  billion acquisition of Banamex, as well as the creation of c2it.com,
its  Internet money transfer and payment service. Management believes that there
is  sufficient  customer  dissatisfaction with the incumbent market participants
amongst  consumers  in  regards  to  price,  convenience, quality of service and
privacy  that the company may be able to leverage its proprietary technology and
other  systems  to  effectively  compete  in  niche  markets.

EXISTING  ELECTRONIC  DISTRIBUTION  CONTRACTS

     Keycom  has existing electronic distribution and software license contracts
with domestic Point-of-Sale (POS) terminal operators ('Licensees') which operate
an  existing  network  of  approximately  45,000  retail  locations.  Management
believes  that  this  network  exceeds the number of retail locations in Western
Union's  domestic  network. Western Union uses a traditional franchisee business
model  which  requires  substantial  compliance requirements for the franchisee,
which  the Company believes puts the franchisee at a competitive disadvantage to
emerging  technologies  such as that offered by the Company. Management believes
that  this  will assist in rapidly deploying its software to Licensees. Further,
Keycom  has  existing  contracts  with  international cash payout locations that
processed  ten  million  transactions  in  2000, though this does not imply that
Keycom  will  achieve  any  percentage  of  the  above  volume.

     The  Company  has an agreement with FINET, an affiliate of Bank One, one of
America's  largest national banking organizations, to transmit the cash received
by  the  Company.  The cash is electronically swept nightly in the United States
through  the  Automated Clearing House system (ACH), and is automatically routed
to  the  destination country as specified by the Company. The Company's software
residing  on  remote  computer  servers  processes  and  permanently records the
transactions.


                                        5
<PAGE>
POINT-OF-SALE  SYSTEM

     Keycom  has  developed  and  implemented a proprietary merchant credit card
terminal-based  point-of-sale  software system.  In addition to other management
information  and control functions, Keycom's point-of-sale system and integrated
database  controls  allows  the  Company  to:

     -    capture,  analyze,  and  update  on  a  daily  basis  data relating to
          customers  and  transactions,  including the points of origination and
          identities  and  location of the destination of money transfers, which
          allows  the  Company  to  provide  management with on-demand access to
          current  information;
     -    utilize  a  streamlined  automated  data  entry  methodology  to guide
          service  associates  to  take appropriate actions and to better manage
          transaction  efficiency  at  point  of  sale;
     -    monitor  daily  revenues by product or service on a company, regional,
          and  per  store;
     -    identify  cash  differences  between bank statements and the Company's
          records  (such  as  differences  resulting  from  missing  items  and
          deposits);
     -    determine,  on  a daily basis, the amount of cash needed at each store
          location,  allowing  centralized cash management personnel to maintain
          the  optimum  amount  of  cash  inventory  in  each  store;
     -    reduce  the  risk of transaction errors by, for example, automatically
          calculating  all transaction fees, sales commissions, foreign exchange
          conversions  and  revenue  participation  and  other transaction fees;
     -    provide  products and services in a standardized and efficient manner,
          which  the  Company  believes  allows  its  users a superior degree of
          service  to  customers;
     -    electronically  transmit  information  and  documents  to  third-party
          providers  of  services  or  products  offered  at  the  stores;  and
     -    facilitate  compliance  with  regulatory  requirements.

     The  data  captured  by  the point-of-sale system is transmitted daily from
each  location  to  a  centralized  database  maintained  by  the Company at its
headquarters.

POINT-OF-SALE  ELECTRONIC  DISTRIBUTION  INFRASTRUCTURE

STORE  OPERATIONS  AND  NEW  STORE  LICENSEE  ECONOMICS

     The  Company's  strategy is to create a significant electronic distribution
and  retailing  network  by  establishing  partnerships  with  existing
brick-and-mortar  stores.  The  objective  is  to  locate and establish software
licensees  with  its  merchant  partner  stores  in  highly  visible, accessible
locations  and  to  operate  the  stores  during  convenient  hours. The Company
attempts  to  locate  stores  on  high traffic streets or intersections, in many
cases in or near destination shopping centers and in areas where there resides a
high  demographic  concentration  of  expatriates.  The  Company generally seeks
relationships  with  third-party  companies specialized in locating and securing
contracts with merchant locations. The Company believes that by outsourcing this
function  it  can focus on the development of its technology and other corporate
opportunities,  including  its  mergers  and  acquisitions  plan.

     We  believe  the  Company offers a number of advantages to the merchant and
the  customer.  For  the  merchant it has the potential to increase foot traffic
into  his  store  because  of  the  convenience  for  the customer in by-passing
traditional  check  cashing  stores and trafficking a more desirable convenience
store  or  other  merchant locations.  It also has the potential to increase the
amount  spent  by  each  customer  who may want to purchase more items since the
customer  is  generally  carrying  excess  funds  which  are  intended  to  be
internationally  transferred  and/or to purchase prepaid long distance services.
For  the customer it is faster and easier than any service currently provided in
the  market,  it requires no identification at checkout, there is instant global
cash  availability  and  there  is the utility of purchasing other point-of-sale
services  conveniently.


                                        6
<PAGE>
BUSINESS  STRATEGY

     Consumers  sending expatriate remittance funds and individuals without bank
accounts  are  the  two largest segments of repetitive money transfer customers.
The  Federal  Reserve  Board of Governors estimates that there are approximately
15%  of  families  in  the  United  States  that  do not have checking accounts.
Additionally,  industry analysts estimate that there are an increasing number of
people who remit funds to relatives in their respective countries of origin on a
regular  basis and that this market will continue to grow.  KeyCom believes that
the  migration dynamics throughout Latin America, the Caribbean, Europe and Asia
provide  attractive  growth  potential  for  consumer  money  transfer services.

     KeyCom  is  focusing  its  business  on  the wire transfer business and has
concentrated  its  rollout  and  initial  marketing efforts to specific targeted
populations,  including the Latin American and Caribbean.  This market is large,
approximately  $24 billion in annual wire transfers, easy to identify and reach,
and  offers  numerous  opportunities  to  establish  strategic  alliances  with
existing.

GROWTH  STRATEGY

     Emergent's  growth  strategy  consists  principally  of combining corporate
acquisitions  and  new  store  locations  for  software  installation  with  the
objective of having the largest number of retail financial services locations in
each  of  its  markets  and  developing  new  products for introduction into the
existing  store  base. KeyCom defines its target markets as cities of 100,000 or
more and markets that have a high demographic concentration of expatriates.  The
Company  has  contracts  with  distributors representing in excess of forty-five
thousand  existing  stores.  The  Company also focuses on the development of its
network  internationally.  The  Company  has  secured  strategic  contracts with
established  internationally-based  payout  locations with transaction volume in
excess  of  ten  million  transactions  annually.

     Growth  Through  Targeted  Acquisitions.  Emergent  expects  to continue to
pursue  strategic  acquisitions to strengthen its product and service offerings.
Emergent  believes  that by acquiring such companies, it can integrate them into
its  business strategy and improve its customer base, products and services, and
financial  results.

RECENT  DEVELOPMENTS

     Name  and  Symbol Change.  On August 2, 2001, the Company filed Amended and
Restated  Articles  of  Incorporation  with  the Secretary of State of Delaware,
changing  its  name  to  Emergent Financial Group, Inc.  As a result of its name
change,  Emergent  also  changed  its ticker symbol from "IBTR" to "EMFL" on the
NASDAQ  OTC  Bulletin  Board.


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<PAGE>
     Acquisition  of Keycom.  On July 19, 2001, Emergent entered into definitive
agreements  described  below  to acquire all of the outstanding capital stock of
Keycom  Corporation,  a  Delaware  corporation,  which has developed proprietary
communications  software  and  integrated  database  applications  for  the
international  remittance  of  cash  transactions.

     ThemeWare  Corporation.  During  the  fiscal year ended March 31, 2001, the
company  expanded  its  relationship  with  ThemeWare  through a series of loans
aggregating  over  $3,600,000, intending to use the Internet to provide services
to  its  target  market.  Based  on  numerous  factors,  including  an  extended
deterioration  in the capital markets in regards to B2B companies, the new focus
of  ThemeWare's  management did not attract the necessary funding to sustain its
business  model. As detailed in the financial statements, current management has
determined  that the collectibility of the loans to ThemeWare is in question and
has  written  the  carrying  value  to  zero.

     Debt  Restructuring.  On  July 18, 2001, the board of directors unanimously
approved  a  restructuring  plan which called for a recapitalization through a 1
for  30  reverse  split  and  authorized  the immediate negotiation with certain
creditors  to exchange equity of the company for existing defaulted debt owed by
the  company.  In  connection  with  approving  the revised business plan at the
meeting,  the  directors  unanimously  approved  a  resolution  appointing Jason
Galanis  as President and CEO and, concurrently therewith, directors Weitzel and
Pilallis  tendered  their  resignations.

     ECARD  SOLUTIONS,  INC.

     On  January  18,  2000,  Emergent  acquired,  through Shanecy Holding, Inc.
("SHI"),  a  wholly-owned  subsidiary  of  the Company,, 400 shares of preferred
stock  of  eCard  Solutions,  Inc.,  which  were  initially  convertible  into
approximately  40%  of  eCard  Solutions.  This  interest in eCard Solutions was
acquired  from  Thesseus  International  Asset  Fund  NV, a Netherlands-Antilles
company, which is partially owned indirectly by Jason Galanis, through a merger,
effective  January 11, 2000, between SHI and a subsidiary of Thesseus, in return
for  two million common shares of the Company.  Three of the Company's directors
were  directors  of  Thesseus  at  that  time.

     eCard  Solutions  is  a  specialty  financial  services  company  that used
proprietary  database  mining,  marketing  techniques,  automated  systems  and
information technology to issue credit cards to moderate income consumers. eCard
Solutions  manages  the  resulting portfolio of accounts in an attempt to ensure
that  they  remain  in  a  performing  status.

     The income level of moderate-income consumers ($25,000 to $50,000 per year)
presents  a  profile that is unattractive to the majority of credit card issuers
who  are  focused  on  the  upper  income consumer that can qualify for gold and
platinum  cards.  Given  their  economic circumstances, eCard Solutions believes
moderate-income  consumers  that  have  had  access  to credit, often experience
problems  due  largely  to  circumstances  beyond their control (i.e. employment
interruption,  marriage  break-up,  extended  uninsured  illness, etc.).  Once a
credit problem has tarnished an individual's credit report, it becomes extremely
difficult  to  obtain  new  credit, regardless of the change in the individual's
economic  circumstances.  Compounding  the  credit  access  problems  of  many
moderate-income consumers is the fact that they generally have not been educated
in  the  basics  of  personal  financial  management.

     To  address the opportunity represented by what eCard Solutions believes is
an  underserved,  30  million  to  40  million household market, eCard Solutions
determined  to  exchange  certain  assets described below for preferred stock in
Junum  Incorporated, a Delaware corporation (www.junum.com).  Effective December
31,  2000,  eCard  Solutions entered into a transaction with Junum wherein eCard
sold  to  Junum  its  inventory  of  non  performing  debt  ("the "Receivables")
containing  approximately  189,000  individual  accounts  with  a  face value of
approximately  $352  million,  as  well  as  certain  intellectual  property and
business  systems  relating to the conversion of non-performing receivables into
performing  receivables.


                                        8
<PAGE>
ABOUT  JUNUM.COM

     Junum  is a financial technology company engaged in Credit Management, Debt
Exchange  and  Financial  Services.  Credit Management works towards improving a
Member's  Credit Rating and protecting their Credit Identity through the removal
of  inaccurate, outdated and unverifiable information from their credit reports.
This  membership  service  is for individuals, small businesses and corporations
with  reoccurring  monthly  charges.  Debt  Exchange  offers consumers and small
businesses  that  may have become delinquent on a debt the opportunity to regain
their  credit  standing.  Financial  Services  uses the Company's patent-pending
Analysis Engine to match its members' credit status with loans, leases and other
credit  offers  from  the  Company's  lending  partners.

TRANSACTION  TERMS

     eCard  is  entitled  to  convert  each  share of Preferred Stock into 1,000
shares  of  Common Stock of Junum.  While it holds the Preferred Stock, eCard is
not  entitled  to  vote on matters submitted to shareholders of Junum, except as
required  by law. The Preferred Stock also is subject to a per share liquidation
preference  of  $1,000.00,  plus any accrued but unpaid dividends.  There are no
mandatory  dividends.  The  Preferred  Stock  issued to eCard Solutions, and all
shares  of common stock issuable upon conversion of such Preferred Stock, is not
transferable  for  a  period of 24 months following the Closing Date without the
prior  written  consent  of  the  Junum.

     Junum has the right, at any time following November 15, 2002, to redeem for
a  redemption  price  of  $0.10  per share of Series C Preferred Stock, plus the
Redemption  Assignment  (as described below) all or any portion of the Preferred
Stock, but only in the event Junum receives and collects less than $4,900,000 in
Net  Collections  from the Receivables.  In such event, on or after November 15,
2002,  Junum has the right to redeem a number of shares of Preferred Stock equal
to  the  difference between $4,900,000 and the Net Collections.  There can be no
assurance  that Junum will receive any Net Collections, and, therefore, there is
no  assurance  that the Company will realize any value from the Preferred Stock.

     Net  Collections  means  the  amount  of all balance transfers arising from
conversion  of  debts constituting a part of the Receivables, plus the amount of
actual  cash  collections received by the Company in satisfaction of any portion
of  the  Receivables  that  are  not  considered balance transfers, less (i) all
direct  operating costs of Junum relating to the collection or conversion of the
Receivables, (ii) any third party commissions or fees relating to the collection
or conversion of the Receivables, and (iii) any other direct costs of collection
or  conversion of the Receivables.  A "balance transfer" refers to the amount of
debt  agreed  to be transferred to a new credit card issued by or through Junum,
and  for  which  Junum  or its agent receives at least one cash payment from the
debtor.

     In  the  event  any portion of the Preferred Stock is redeemed as described
above,  then Junum will transfer the Redemption Assignment to eCard upon receipt
of  the  certificates  evidencing  the  redeemed Preferred Stock. The Redemption
Assignment  refers  to  an assignment of a portion of the Receivables which have
not  been  previously  converted  or paid, equal to a fraction, the numerator of
which  is  the  number of shares of Preferred Stock redeemed and to be redeemed,
and  the  denominator  of  which  is  equal  to  4,900.


                                        9
<PAGE>
     Two directors of the Company serve on eCard's Board of Directors and one of
those  directors  has  entered into a Consulting Agreement with Junum to provide
assistance  to  Junum  in marketing the Junum's membership offerings, as well as
various  other  products  and  services  to the general public as well as to the
account debtors with respect to the accounts which constitute the non-performing
credit  card  portfolios  owned  and  to  be  acquired  by  Junum.

EMPLOYEES

At  March  31,  2001,  the  Company employed directly two persons on a full-time
basis  and no persons on a part-time basis.  None of the Company's employees are
covered  by  a  collective  bargaining  agreement.  The  Company  considers  its
employee  relations to be good.  KeyCom currently employs 8 full time and 1 part
time  employees,  none of whom are covered by a collective bargaining agreement.

EXECUTIVE  OFFICERS

     See  below.  Part  III;  item  10.

ITEM  2.      DESCRIPTION  OF  PROPERTY

     The Company presently has a month-to-month lease for office space at 3550 N
Central  Avenue,  Suite 1800, Phoenix, AZ 85012.  The lease has an annual rental
cost  of  approximately  $12,000.00.

ITEM  3.      LEGAL  PROCEEDINGS

     Incubator  Capital  Group,  LLC.  v.  Incubator  Capital,  Inc.

     On  August  24,  2000,  a legal action was commenced against the Company by
Incubator  Capital  Group,  LLC ("ICGL") in the United States District Court for
the  Southern  District  of  New  York.  The claims are purportedly based on the
trademark  rights of ICGL, for the Company's use of the name "Incubator Capital"
and  its  use of the domain name www.incubatorcapitalcorp.com.  ICGL has filed a
complaint that includes causes of action for False Designation of Origin, Unfair
Competition,  Federal Dilution, State Dilution and Deceptive Acts and Practices,
which  seeks injunctive relief and damages in an unspecified amount. This matter
is  in  its  early  stages,  as  the  Company  and ICGL currently are in dispute
regarding procedural issues, whereby the Company claims that is was not properly
served  with  a  summons  and  complaint,  and  ICGL has taken the position that
service  was  effected,  and that it will seek a default judgment for failure to
file a responsive pleading. The Company intends to vigorously defend the action.
The outcome of the litigation is uncertain and cannot be predicted at this time.
Any  adverse  result could have a material adverse affect on the business of the
Company.  At  this  time,  as  the  Company  has  abandoned  the use of the name
Incubator  Capital,  management believes that this litigation will be settled in
the  near  future.

     From  time  to  time,  the Company is involved as plaintiff or defendant in
various  other  legal  proceedings arising in the normal course of its business.
While  the  ultimate  outcome  of  these  various  legal  proceedings  cannot be
predicted with certainty, it is the opinion of management that the resolution of
these legal actions should not have a material effect on the Company's financial
position,  results  of  operations  or  liquidity.


                                       10
<PAGE>
ITEM  4.  SUBMISSION  OF  MATTERS  TO  A  VOTE  OF  SECURITY  HOLDERS

     No  matter  was  submitted  to  a  vote  of  security  holders, through the
solicitation  of  proxies or otherwise, during the quarter ended March 31, 2001.
Holders  of  a  majority  of  the  issued  and outstanding Common Stock approved
certain  actions  by  written  consent  adopted  on April 24, 2000, including an
amendment  and  restatement  of  the Company's Certificate of Incorporation, the
adoption  of  a  Stock Option Plan, and approval of the Company's acquisition of
EAL and CASA as described in the Company's Information Statement dated April 26,
2000,  as  filed  with the Securities and Exchange Commission on April 27, 2000.
Additionally,  on  August  2,  2001,  holders  of  a  majority of the issued and
outstanding Common Stock approved certain actions by written consent including a
name  change  to  Emergent  Financial  Group,  Inc. and a 1 for 30 reverse stock
split.

                                     PART II

ITEM 5. MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER MATTERS

     The  Company's  Common Stock is currently traded on the NASDAQ OTC Bulletin
Board  ("NASDAQ  Bulletin Board") under the symbol "EMFL" (recently changed from
"IBTR" pursuant to the Company's name change to Emergent Financial Group, Inc.).
The Common Stock began trading on the NASDAQ Bulletin Board on December 1, 1999.
Prior  to the commencement of trading on the NASDAQ Bulletin Board, there was no
active  trading  market  for  the  Common  Stock.

     The following table sets forth the quarterly high and low closing prices of
the  Common  Stock  from  December  1,  1999, the date on which the Common Stock
commenced  trading on the NASDAQ Bulletin Board through March 31, 2000.  On July
31,  2001,  the  closing  price of the Common Stock on the NASDAQ Bulletin Board
(immediately  prior to a 1 for 30 reverse stock split) was $0.01.  The prices in
the  table  reflect  split-adjusted  interdealer prices without retail markup or
commissions  and  may  not  represent  actual  transactions.

<TABLE>
<CAPTION>
QUARTER ENDED                                  HIGH      LOW
--------------------------------------------  -------  -------
<S>                                           <C>      <C>
December 31, 1999 (December 1, 1999 through
  December 31, 1999). .. . . . . . . . . . .  $121.88  $ 60.00
--------------------------------------------  -------  -------
March 31, 2000 . . . . . . . . . . . . . . .  $363.75  $125.63
--------------------------------------------  -------  -------
June 30, 2000. . . . . . . . . . . . . . . .  $221.75  $ 75.00
--------------------------------------------  -------  -------
September 31, 2000 . . . . . . . . . . . . .  $120.94  $ 15.00
--------------------------------------------  -------  -------
December 31, 2000. . . . . . . . . . . . . .  $ 17.81  $  3.75
--------------------------------------------  -------  -------
March 31, 2001 . . . . . . . . . . . . . . .  $  5.15  $  1.40
</TABLE>

     On  May  12,  2000, the Company's Common Stock was listed and began trading
internationally  in  Germany  on the Third Market Segment of the Frankfurt Stock
Exchange  by the Deutsche Borse AG. The trading symbol is ``SW6'' and the German
securities code is 935 139.  The Frankfurt Stock Exchange is a European exchange
with  a  technology  orientation.


                                       11
<PAGE>
     As  of  March  31,  2001,  there were 594 record holders and approximately
858 beneficial  holders  of  the  Common  Stock.

     On  December  30, 1999, the Company effected a two-for-one stock split (in
the  form  of a 100% stock dividend).  On August 3, 2001, the Company effected a
one-for-thirty  reverse  stock  split.  The stock price information in the table
above  has  been  adjusted  to  reflect  these  stock  splits.

     During  fiscal  2001,  the  Company  did  not pay any cash dividends on its
Common  Stock.  The payment by the Company of cash dividends in the future is in
the  sole  discretion  of  its  Board  of Directors and will depend, among other
things,  upon  the  Company's  earnings,  its capital requirements and financial
condition, as well as other relevant factors. The Company does not intend to pay
dividends  in  the  near  future.

     As  a  Delaware  corporation,  the  Company  may  not declare and pay cash
dividends on its capital stock if the amount paid exceeds an amount equal to the
excess  of  the  Company's  net  assets  over paid-in-capital or, if there is no
excess,  its  net  profits  for  the current and/or immediately preceding fiscal
year.  In addition, the Company's ability to pay dividend to common shareholders
is  subject  to  the  prior  payment  of all accrued but unpaid dividends on the
Company's  outstanding  preferred  stock.

Stock  Issuances  Within  the  last  Two  Fiscal  Years

     On  November  11,  1999, the Company issued 133,333 shares (as adjusted for
the  stock  splits)  of Common Stock to K. Washington-Galanis Investments LLC in
connection  with  the  acquisition of CASA. K. Washington-Galanis Investments is
owned  by  Kevin  Washington  and Jason Galanis, both directors. Galanis is also
current  President  and  CEO.

     On  November  11,  1999, the Company issued 100,000 shares (as adjusted for
the  stock splits) of its Common Stock and agreed to issue 8.5 million shares of
Series  A  preferred  stock  to  Thesseus  in  connection  with  the  Company's
acquisition  of  EAL.

     On January 18, 2000, the Company agreed to issue 66,667 shares (as adjusted
for  the  stock  splits) of Common Stock to Thesseus International Asset Fund in
connection  with the Company's acquisition of an interest in eCard Solutions and
Infobase.  The majority shareholder of Thesseus is an irrevocable trust to which
Jason  Galanis,  the  President  and  CEO  and  director  of  the  Company, is a
one-fourth  beneficiary.

     On  January  24,  2000,  the  Company  granted an option to purchase 16,666
shares to a shareholder of the Company at an exercise price of $210.00 per share
(as  adjusted  for  the  stock  splits).

     On  February  8,  2000,  the  Company  issued  warrants  to  Donner  Corp.
International  to purchase up to 1,666 shares (as adjusted for the stock splits)
of  the  Company's Common Stock at exercise prices ranging from $360 to $540 (as
adjusted  for  the  stock  splits)  as  consideration for investment banking and
related  services.  The  warrants  expire  on  November  1,  2003.


                                       12
<PAGE>
     On December 29, 1999, the Company issued 13,333 shares (as adjusted for the
stock  splits)  of Common Stock to OTC Filing.com, Inc. as partial consideration
for  financial  consulting  and  investor  relations  services  provided.

     On  May  16, 2000, in consideration for services rendered under an investor
relations  agreement, the Company issued Sabre Communications, Inc. a warrant to
purchase  6,666  shares  of its Common Stock, with an exercise price of $120 per
share  (as  adjusted  for  the  stock  splits) for a two year term commencing on
November  16,  2000.

     On  May  22,  2000,  in  consideration for investment services, the Company
issued  Quadrant  Investment  Bankers  a warrant to purchase 3,333 shares of its
Common  Stock,  with  an  exercise  price of $120 per share (as adjusted for the
stock  splits)  for  a  two-year  term  commencing  on  November  22,  2000.

     On  May 12, 2000, in consideration for obtaining a listing on the Frankfurt
Stock Exchange and for ongoing long-term market making sponsorship services, the
Company  issued  Berliner  Freiverkehr a warrant to purchase 6,666 shares of its
Common  Stock,  with  an  exercise  price of $280 per share (as adjusted for the
stock  splits)  for  a  two  year  term  commencing  on  May  12,  2000.

     As  of  March  31,  2000, the Company granted, pursuant to its Share Option
Plan,  options  to  purchase an aggregate 350,000 common shares (as adjusted for
the  stock  splits)  to  certain  officers  and  directors at exercise prices of
between  $1.20 and $60.00 per share.  The options have either a five or ten year
term  and  are  currently  exerciseable.

     On  May  30,  2000, the Company received a loan from a shareholder who is a
brother  of  a  director  of  the Company.  The loan bore interest at 8% payable
quarterly  in  arrears  commencing  September  1,  2000  and principal was to be
payable  in full on July 1, 2001. Subsequently, on July 7, 2000, the shareholder
converted  this  loan  into  1,000,000  non-voting, non-redeemable, Series B, 8%
cumulative  preferred  shares  in  return  for  1,666  two-  year  warrants each
entitling  the  holder  to acquire one common share for $75 (as adjusted for the
stock splits).  The preferred shares are convertible into 250,000 common shares,
subject  to  anti-dilution provisions.  The accrued but unpaid dividends on such
preferred stock is convertible into the Company's Common Stock at the average of
closing  prices  on  the thirty trading days commencing 45 trading days prior to
conversion  of  such  dividends into Common Stock.  The Company is in default of
the  provisions  of  such  preferred stock as a result of its failure to pay any
accrued dividends.  The Company is in negotiations with the holder of the Series
B Preferred Stock to waive all defaults and convert its Series B Preferred Stock
into  Common  Stock.

     On  September  22,  2000,  the  Company  created  and issued 1,300 Series D
Preferred  Shares  with  a  stated  value  of  $1,000  each, which are generally
non-voting  and  not entitled to dividends, for $500,000 cash plus the return of
300,000  then  outstanding Common Shares of the Company.  The Series D Preferred
Shares  are  convertible  at any time, in an amount equal to the stated value of
the Series D Preferred Shares together with an Additional Amount calculated on a
daily basis at a rate of 4.5% per annum, into Common Shares of the Company based
on  a  value  of  80%  of  the then current market value of the Company's Common
Shares,  to  a  maximum  of $1.50 per Common Share.  At any time after the first
anniversary  of  their  issuance,  the Company may redeem each Class D Preferred
Share  at  a price equal to the greater of $1,400 plus the Additional Amount and
the  market  price  of the Common Shares into which such Class D Preferred Share
could  then  be  converted.


                                       13
<PAGE>
     Exemption  from  registration  for the issuance described above was claimed
pursuant  to Section 4(2) of the Securities Act of 1933, as amended, in reliance
upon  the  fact that such sales did not involve a public offering.  As a result,
such  securities  are  subject  to  certain  transfer  restrictions.


ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF  OPERATIONS  OR  PLAN  OF  OPERATION

Forward  Looking  Statements

     When  used  in this Form 10-KSB, the words or phrases "will likely result,"
"are  expected  to," "will continue," "is anticipated," "estimate," "projected,"
or  similar  expressions  are  intended to identify "forward looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1995. Such
statements  are  subject  to  certain risks and uncertainties, including but not
limited to, lack of operating history, need for additional financing and history
of  losses.  Such  factors,  which  are discussed in Management's Discussion and
Analysis of Financial Condition and Results of Operations, could affect Emergent
Capital,  Inc.'s  ("Emergent"  or the "Company") financial performance and could
cause  the Company's actual results for future periods to differ materially from
any  opinion or statements expressed herein with respect to future periods. As a
result, the Company wishes to caution readers not to place undue reliance on any
such  forward-looking  statements,  which  speak  only  as  of  the  date  made.

OVERVIEW

     Emergent  is  an  investor  in  technology-oriented  alternative  financial
services  companies.  Specifically,  management  attempts  to  identify emerging
payment  technologies  in  the  non-bank  transaction  processing and electronic
payments  industries.  Card-based  technologies and services such as specialized
credit  card,  debit  card,  chip-embedded (or 'smart') card, other stored-value
cards  and  various  point-of-sale  technologies  are  the  focal  point  of the
investment  strategy.  The  business  plan  is to invest in or acquire a limited
number  of  such companies where there exists identifiable and immediate revenue
streams  and  where multiple revenue streams can be generated from each location
where  the  company's  software  is installed. Revenue is, or will be, primarily
derived from receiving a fee for providing basic financial services such as cash
remittance,  check  cashing  or prepaid telecommunications services. The company
seeks  businesses  that  have  developed  either  proprietary technology or ones
employing  widely  available  systems.  A  prerequisite  criterion  is  that the
prospective electronic payments business plan has a fee-based revenue model with
no,  or  minimal,  continuing credit or transaction risk exposure. The Company's
business  strategy  is  to  generate recurring fee-based revenue by developing a
broad  base  of  customers  who  access  our services in familiar and convenient
third-party  retail  locations.  There  can  be  no assurance, however, that the
Company will identify or acquire any business or that any business acquired will
meet  any  of  the  criteria  set  forth  herein.

GENERAL

     The  Company  has  a  limited  operating  history  upon  which  to  base an
evaluation  of  its  business.  The  Company's  business  and  prospects must be
considered  in  light  of  the  risks,  expenses  and  difficulties  frequently
encountered  by  companies  in  the  early  stages  of development, particularly
companies  in new and rapidly evolving markets. In addition, because the Company
acquires  significant  interests  in  companies  which concentrate on businesses
using  the  Internet  to  provide  products  and  services  to  moderate  income
consumers, many of which generate net losses, it is experiencing, and expects to
continue  to  experience,  significant  volatility in its operating results. The
Company  does not know when or if it will report net income, and it expects that
it  will  report  net  losses  in  many  quarters  for  the  foreseeable future.


<PAGE>
     Emergent  was  originally  incorporated as Shanecy, Inc. in Delaware on May
31,  1994,  and was organized to act as a home health care analysis and referral
service.  On March 10, 1999, the Company filed a registration statement with the
Securities  and  Exchange  Commission  ("SEC")  in  order  to become a reporting
company.  On  November  11,  1999,  the  original  business  activities  were
discontinued.

On  November  11,  1999,  the  two  existing  directors of Emergent resigned and
appointed  Jason  W.  Galanis and Kevin L. Washington to replace them.  Prior to
this  event, the Company was inactive and had no material assets or liabilities.
On  November  19, 1999, Harry Weitzel was appointed Chairman and Chief Executive
Officer  joined  by  Bloom  and  Knight  and  on  December 31, 1999, three final
appointments  were made, Pilallis, Bodnar and Wise, bringing the total number of
Directors  to eight. Under the direction of its new board, the Company pursued a
business  strategy  of  internet-focused investments. Subsequently, on September
12,  2000  the  Company  determined to define its business plan more narrowly to
provide  small  business  owners  with a full range of Internet-based enterprise
solutions  (B2B),  at which time Mr. Galanis resigned as an executive officer of
the  Company.  Concurrent  with  his  resignation  Mr.  Galanis,  who remained a
Director,  arranged  for  additional  equity  financing  through the issuance of
Series  D  preferred  stock  to  an institutional investor (see note 6(d) of the
audited  Financial Statements ending March 31, 2001). Beginning in October 2000,
the  existing  management directed the Company to begin to borrow funds from the
Starfish  Group  pursuant to certain notes, which included unsecured notes and a
series  of  short-term  senior secured promissory notes. The Company borrowed an
aggregate of approximately $3,600,000, $1,600,000 of which was received from Mr.
Washington.  Based  on  numerous factors, including an extended deterioration in
the capital markets in regards to B2B companies, the new focus of management did
not  attract  the  necessary level of funding so as to obtain funding other than
the secured notes above and, as a consequence, the Company could not sustain its
B2B  business  model.  On  December  31,  2000, the Company defaulted on certain
secured  debt  obligations  as  disclosed  in  the Form 10Q for the period ended
December  31,  2000 (also see "Management's Discussion and Analysis of Financial
Condition and results of Operations-Financial Condition"). The defaults also led
to  a foreclosure on certain assets of the Company, which consisted primarily of
the  Company's interest in EAL, on February 17, 2001 (see Financial Statements),
which  was  not  contested  by  prior  management.

     On  July 18, 2001, the Board of Directors adopted a new business plan which
seeks to focus on investments in niche emerging payment services companies which
pursue  strategies  in  electronically  delivered  financial services. The board
approved a restructuring plan which will include the conversion of approximately
$3,000,000  of  outstanding  debt  into  approximately  15%  of  the  Company's
outstanding  Common Stock on a fully diluted basis, a name change of the company
from  Inc.ubator  Capital  to  Emergent  Financial  Group,  Inc., and a 1 for 30
reverse  stock split of the Company's Common Stock. In connection with approving
the  revised  business plan at the meeting, the directors unanimously approved a
resolution  appointing Jason Galanis as President and CEO and, at the conclusion
of  the  meeting, directors Weitzel and Pilallis tendered their resignations. As
of  August  8,  2001,  the  Company  has completed the name change, the 1 for 30
reverse stock split, and has had substantial progress in negotiations to convert
the  debt  as  described  above, although no assurance can be provided that such
conversion  will  take  place.

Effect  of  Accounting  Methods
-------------------------------

     The  various  interests  that  Emergent  acquired  in  its subsidiaries are
accounted  for  under  the  equity, consolidation or cost method. The applicable
accounting method is generally determined based on the Company's voting interest


<PAGE>
in  the subsidiaries. In the future, the presentation of the Company's financial
statements  may differ from period to period, primarily due to whether or not it
applies  the consolidation method or the equity method. This could result if its
voting  interest  in a company either rises above or drops below 50%. See Note 2
(b)  of  the  notes  to  the Company's audited Consolidated Financial Statements
filed  in the Form 10K-SB for a detailed discussion of these accounting methods.

     The  Company  evaluates,  on  an  ongoing  basis, the carrying value of its
ownership  interests  in  and advances to the companies in which it has invested
("Subsidiaries")  for possible impairment, based on achievement of business plan
objectives,  the financial condition and prospects of the Subsidiaries and other
relevant  factors.  Such  factors  may  be financial or non-financial in nature.

Results  of  Operations  for  the  Year  Ended  March  31,  2001
----------------------------------------------------------------

     The twelve month period ended, March 31, 2001 continues to reflect start-up
results  only  as  Emergent  began  operations  November  11,  1999, a period of
approximately  sixteen  months.

     Historically,  the  Company's  reported  results  of operations include all
amounts  for  the  parent  company,  Emergent,  and  its wholly-owned subsidiary
companies, CASA@Home.com, Inc. ("CASA"), Eikos Acquisition Limited, ("EAL"), and
Shanecy  Holdings,  Inc.  ("SHI").  All three subsidiaries were either formed or
acquired  recently  and/or have limited operations. CASA remains inactive, while
EAL  and SHI are holding entities and as such, their operating expenses were not
a  material  part  of  the operating expenses of the consolidated entity for the
Year  ended  March  31,  2001  or  since  the  Company  began  operations.

     SHI has accounted for its investment in InfoBase Direct Marketing Services,
Inc.  ("InfoBase")  on  the equity basis. At September 30, 2000 the net carrying
value  of  this  investment  was  $226,466.  InfoBase's ability to carry out its
business plan was dependent on receiving additional investment from the Company.
During  the  third quarter it was determined that no additional investment would
be  made  into  InfoBase by the Company and the Company's investment in InfoBase
was  completely  written  off. Additionally, the Company carries in its accounts
receivable  $53,190  that  is  due  from  an  officer  of  InfoBase. It has been
determined that the receivable is uncollectible and it too has been written off.
The  financial impact of the write-offs was an increase in net loss of $279,656.

     The  sole asset of CASA at the date of acquisition was certain intellectual
capital  and  a  business  plan  for an Internet-based provider of services. The
Company  carried  this  asset  at  the  par  value  of  the  shares issued which
represented the cost base of the former owners. The ability of CASA to implement
its  business  plan  is  dependent  on  receiving additional investment from the
Company. The Company has been unsuccessful in raising sufficient funds to invest
in  CASA  and to date has been unable to implement its business plan. During the
third  quarter  it  was  determined to completely write off this investment. The
write-off  of  this  investment  resulted  in an increase in net loss of $2,000.

     SHI  also  accounts  for  its  investments in eCard Solutions, Inc. ("eCard
Solutions")  on the equity basis and recorded total equity losses for the twelve
months  ended  March  31, 2001 of $5,609,324, including $5,099,490 write down of
Junum's  Series C Preferred Stock (Please see Note 3(b) and Note 12 of the notes
to  the  Company's  audited  Consolidated Financial Statements filed in the Form
10K-SB,  which  represents  approximately  28%  of the loss for the consolidated
entity.  Since the Company commenced its new business strategy in November 1999,
comparisons  to  the  same  period  of  the  prior  year  are  not  relevant.

     The  Company  reported  a  net operating loss of $20,024,521, or $29.63 per
share  (as  adjusted for stock splits, see Financial Statements), for the twelve
months ended March 31, 2001 and $17,216,464 or $24.70 per share (as adjusted for
stock  splits)  for  the  three  months  ended  March  31,  2001.

     Revenue.  The  Company  reported  total  revenue of $191,880 for the twelve
months  ended  March  31,  2001,  which  represents  primarily interest on funds
advanced  to  ThemeWare.  As  reflected  in  Note 2 (d) of the Company's audited
Consolidated  Financial  Statements  included  in  this Form 10-KSB, the Company
accounts  for  payments  received from Eikos Management, LLC ("Eikos") under the
Mutual  Business Development Agreement (the "MBDA") on a cost recovery basis. No
additional  revenue  will be recognized from Eikos, as the company's interest in
EAL  has  been  transferred  to a creditor pursuant to a foreclosure proceeding.

     Expenses.  The  Company  had  expenses  of $2,832,957 for the twelve months
($738,900  -  3  months) ended March 31, 2001 of which consulting and legal fees
represented  $1,007,685 ($477,119 - 3 months) and $885,642 ($83,578 - 3 months),
respectively.  The  Company's expenses related to the commencement of operations
as  a public company, the acquisitions of the companies discussed herein and the
preparation of securities documents. Expenses also included audit and accounting
expenses of $81,825 and an administration fee payable to Thesseus Services Ltd.,
a  subsidiary  of  Thesseus  International  Asset  Fund NV (a related party), of
$205,644.

Financial  Condition
--------------------

     At  March  31,  2001, the Company's assets were comprised primarily of it's
investments  in  eCard. Substantially all of the Company's other assets had been
written  off.  Please see Note 3 of the Company's audited Consolidated Financial
Statements  for  the  year  ended  March  31,  2001,  for  a  full  description.

     As  described  in  Note  3(c)  and  Note 10 of the Company's March 31, 2001
audited  Consolidated  Financial Statements and commented upon under "Results of
operations  for  the  Year  ended  March 31, 2001", during the third quarter the
Company's investments in InfoBase and CASA were completely written off resulting
in  a  charge  of  $228,466  to  earnings.

     Eikos  Acquisition  Limited  ("EAL").  On  November  11,  1999, the Company
acquired  100%  of  the stock of EAL from Thesseus International Asset Fund N.V.
("Thesseus").  Thesseus  is  considered  a  related  party  by virtue of a Jason
Galanis,  a  director  and  our  current  president and CEO, being, directly and
indirectly,  a stockholder of Thesseus. The carrying value of assets acquired in
the  transaction  was  $6,107,994  as  of  March  31,  2001.

     On  February  17, 2001, The Daimyo Group exercised its rights pursuant to a
secured  note  in  the  amount  of  $500,000  to  foreclose  on a portion of the
collateral,  which  consisted  of  100%  of  the stock of EAL. See Note 5 of the
Company's audited Consolidated Financial Statements for the year ended March 31,
2001,  for  a  full  description.  As  a  result the Company has written off the
Investment  in  the  amount  of  $6,107,994.  The  foreclosure on the EAL asset,
resulted  in  the discontinuance of the MBDA flowing to the Company, which had a
serious  negative  impact  on  the  Company's  financial  viability.

     eCard  Solutions.  On January 18, 2000, the Company acquired an interest in
eCard Solutions from Thesseus, a related party. The investments were transferred
at  book  values  previously  recorded  by  Thesseus totaling $6,276,996 and are


<PAGE>
reflected  in  "Investments" in the audited consolidated balance sheet attached,
net  of  equity  losses  of  $5,713,110 (Please see Note 3(b) and Note 12 of the
notes  to  the  Company's audited Consolidated Financial Statements filed in the
Form 10K-SB) reflected in the audited statement of operations for the year ended
March  31,  2001.

     On March 13, 2000, eCard Solutions created two separate series of preferred
shares.  The  then  existing  400 preferred shares acquired were reclassified as
Series  A  and  have  a  total redemption value equal to the $6,276,996 carrying
value  acquired.  Additionally,  the  Company  committed to invest $1,000,000 in
eCard Solutions through the acquisition of one million Series B preferred shares
in  eCard  Solutions.  Payment  was  to  be  made  in four equal installments of
$250,000  on  March  13,  April  13,  May  12  and  June  12,  2000.

     At March 31, 2000,  $250,000 had been paid and the balance of  $750,000 was
reflected  as  a  note payable in the consolidated financial statements.  In the
first  quarter,  Emergent  management  determined  that  the  interests  of  its
shareholders  would best be served by attempting to restructure this transaction
so  as  to  eliminate  any  future  payments  for  the Series B preferred stock.

     As  of  March  31,  2001,  Emergent  and  eCard  Solutions  were  still  in
negotiations but had not yet reached formal agreement on this matter. Subsequent
to  March  31,  2001,  renegotiations  to  the terms of the Company's investment
commitment  with  eCard  were  not  successful.  The  Company  has determined to
write-off  the  investment  in  the  Series B preferred stock, net of the unpaid
balance  of the note, which would result in an approximately $250,000 write-off.

     In  addition,  subsequent to March 31, 2001, management determined that the
carrying  value  of  the eCard Series A Preferred Stock was impaired and agreed,
after  consultation  with its auditors, to record a write-down.  eCard's primary
asset  is  it's investment in Junum Series C Preferred Stock (see below for full
description).  The  Company believes that the future value, if any, of the Junum
Series C preferred stock is not determinable and the Company believes that eCard
should  record  impairment  in  this  asset as noted herein.  The effect of such
impairment  by  eCard  would  be  to  increase  equity  losses of the Company by
$5,099,490.  The  revised  carrying value in eCard is further reduced by a write
down  from  $563,886  to  $1,

     The  Company  had  a  working  capital  deficiency  of  $5,356,000  and  an
accumulated  deficit  of  $21,090,000  at March 31, 2001. The Company expects to
remain  in a negative working capital position for the foreseeable future and if
it is unable to promptly raise additional funding to augment its working capital
position  it  will  not  be  able  to  continue  as  a  going  concern.

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

     A  major  objective  of Emergent is to raise sufficient capital to maintain
its  viability as ongoing concern. The primary sources of cash to date have been
loans and preferred equity financing from related parties and distributions from
EAL pursuant to the MBDA. The Company has also raised $500,000 through a private
placement  for  its  Series  D  preferred  stock. Under the terms of the private
placement  of the Series D preferred stock, IIG Equities Fund NV purchased 1,300
shares  of  Series  D  preferred  stock  from  the Company in exchange for total


<PAGE>

consideration of $1,300,000 in the form of $500,000 in cash and 10,000 shares of
the  Company's  common  stock  (as  adjusted for splits). The Series D Preferred
Shares  are  convertible  at any time, in an amount equal to the stated value of
the Series D Preferred Shares together with an Additional Amount calculated on a
daily basis at a rate of 4.5% per annum, into Common Shares of the Company based
on  a  value  of  80%  of  the then current market value of the Company's Common
Shares,  to  a  maximum  of  $1.50 per Common Share. At any time after the first
anniversary  of  their  issuance,  the Company may redeem each Class D Preferred
Share  at  a price equal to the greater of $1,400 plus the Additional Amount and
the  market  price  of the Common Shares into which such Class D Preferred Share
could  then  be  converted.

     The  primary  use of cash has been for general and administrative expenses,
the initial installment of $250,000 made to e-Card Solutions to fund the partial
payment  for the Series B preferred shares, the $3,627,000 advanced to ThemeWare
to  date  and  $570,000 advanced to Graphics Technology, Inc. ("GTI").  At March
31,  2001,  Emergent  had  zero cash on hand.  The Company expects negative cash
flows from operations to continue for the foreseeable future and if it is unable
to  promptly raise additional funding it will not be able to continue as a going
concern  (see  "Subsequent  Events").

         During the twelve months ended March 31, 2001, the Company's operations
were  financed primarily through advances under notes payable to Starfish Group,
LLC,  Graybox,  LLC,  and  The  Daimyo  Group,  Inc.,  collectively  "Starfish",
amounting  to  $3,585,348,  the  return  of  a  refundable  deposit  ($150,000),
short-term  accounts  payable  $839,626,  the  issuance  of  preferred  stock
($1,500,000) and cash flow from the Company's 49.5% interest in Eikos, which the
Company  holds  through  its  former  wholly-owed  subsidiary,  EAL  ($337,500).

     At  March  31,  2001,  the  Company  had  a  working  capital  deficit  of
approximately  $5,356,000  and  zero  cash on hand.  If the Company is unable to
promptly  raise  additional  funding  it will not be able to continue as a going
concern.  The  Company  is  diligently  exploring  various  options to alter its
capital  structure and raise the additional funding it requires.  However, there
can  be no assurance that additional funding will be available or, if available,
that  it  will  be  available  on  terms  acceptable  to  the  Company.

Recent  Developments
--------------------

     On  September  12,  2000,  Mr.  Jason Galanis stepped down as President and
Chief  Operating  Officer  of the Company for personal reasons.   As of July 18,
2001, Mr. Galanis was unanimously elected by the Board of Directors as President
and CEO.  (Please see comment under Subsequent event)  Mr. Galanis still remains
a  significant shareholder of the Company and a member of the Company's Board of
Directors.  On  January  7,  2001,  Michael  Bodnar resigned as an Officer and a
Director  of  the  Company  to  take another position with an unrelated firm. On
March  2,  2001  Director  Rory  Knight  resigned.

     On  August 25, 2000, the Company entered into an agreement to purchase 100%
of all of the outstanding capital stock of ThemeWare Corporation in exchange for
$135,000,000  of  the Company's common stock and a commitment to advance a total
of  $5,000,000  to  ThemeWare  under  certain  conditions.  The  Company did not
complete the acquisition, and no shares were issued. However, the Company agreed
to advance up to $5,000,000 to ThemeWare. These advances are covered by a demand
note  bearing  interest  at 8%. As of March 31, 2001, the Company had made total
advances  to  ThemeWare  of  $3,627,000.


<PAGE>
     During  the  second  quarter  operational results at ThemeWare deteriorated
significantly  and  as  a  result,  ThemeWare requested funding from the Company
beyond  that  which  was  required  under  the  terms of its purchase agreement.

     During the fourth quarter, ThemeWare significantly curtailed its operations
and  released  all  but  11  of its 93 employees.  The Company continued to seek
financing for ThemeWare during this period, but was unsuccessful.  Subsequent to
the  year-end,  Jason  Galanis,  then  acting  only  as a director, arranged for
certain  unsecured  financing  to  be  provided to ThemeWare from a third party.
(Please  see  comments  under  Subsequent  event)

     Subsequent  to  March  31,  2001,  the operations of ThemeWare continued to
deteriorate  and,  as  a  result, the company no longer has reasonable assurance
that  ThemeWare  will  continue  as a going concern.  The Company has determined
that  no  additional advances should be made to ThemeWare and that the Company's
note receivable should be written off.  Additionally, the Company carries in its
Interest  Receivable $164,524 as of March 31, 2001.  It has been determined that
the  receivable  is  uncollectible  and  it  has  been  written  off.

         On  November  20,  2000,  the  Company  entered  into an agreement with
Graphics  Technology,  Inc.  ("GTI")  formerly  known  as  Virtual  Technology
Corporation  ("VTC")  and  GTI  Acquisition Corporation  ("GTI"), both Minnesota
corporations (referred to collectively as "GTIX") under which the Company agreed
to  provide  GTIX  with  secured  credit  financing  up  to $570,000 for general
corporate  purposes  and  to  assume  liability  for  the  payment of certain of
existing  indebtedness  of  GTIX  and/or its affiliates. The credit financing is
evidenced  by  a  "Credit   Agreement   (the   "Agreement"), which grants to the
Company a security interest in all of the assets of GTIX.  As of March 31, 2001,
the  Company  has  provided  $570,000  in  credit  financing  to  GTIX under the
Agreement.

         On December 20, 2000 GTIX filed for Chapter 11 bankruptcy protection in
the  U.S.  Bankruptcy  Court,  District  of  Minnesota,  in  order to facilitate
restructuring  of  its  business.  The  Company  is  a  secured  creditor in the
reorganization  proceeding.

     During  the  fourth  quarter,  the  Company  determined that GTIX's various
restructuring  options  were unlikely to result in any material recovery for the
Company  and  so  the recovery of the Company's advances were no longer assured.
Therefore,  the  Company has written-off the note receivable.  Additionally, the
Company carries in its interest receivable $17,140 as of March 31, 2001.  It has
been  determined  that  the  receivable is uncollectible and it has been written
off.

         Effective December 31, 2000, eCard sold to Junum Incorporated ("Junum")
its  inventory  of  non   performing  debt  (the  "Receivables")  containing
approximately  189,000 individual accounts with a face value of $352 million, as
well  as  certain  intellectual  property  and  business systems relating to the
conversion  of non-performing receivables into performing receivables.  The sale
price  was $5,100,000, payable in the form of 5,100 shares of the Junum's Series
C Preferred Stock (the "Preferred Stock").  The Preferred Stock is redeemable by
Junum in the event Junum does not receive at least $4,900,000 in net collections
(as  defined  in  the  Asset  Purchase  Agreement  between Junum and eCard dated
December  31,  2000)  Please see Note 3(b) of the Company's audited Consolidated
Financial  Statements for the year ended March 31, 2001, for a full description.

     The  Company  believes that the future value, if any, of the Junum Series C
preferred  stock  is not determinable and the Company believes that eCard should
record  impairment in this asset as noted herein.  The effect of such impairment


<PAGE>
by eCard would be to increase equity losses of the Company by $5,099,490.(Please
see  Note  12  of  the  notes  to the audited Consolidated Financial Statements)

     Junum is a financial technology company specializing in credit procurement,
analysis  and  development. The Company has filed eight applications for patents
surrounding its three business components:  Credit Management, Debt Exchange and
Financial  Services.   Distribution  is  through  online monthly memberships for
individuals  and consumers, as well as through established distribution channels
of  the  Company's  e-business  partners  who offer, judge or check credit.  The
Company's  three  primary  systems  include:  the  Internet  for  delivery  of
consumer/small  business  products and services; the Company Intranet for system
and  process  control,  and  the Extranet as a tool for e-Business Partnerships.
Junum  is  traded  on  the NASDAQ bulletin board under the symbol JUNM.  Junum's
Internet  web  site  can  be  accessed  at  www.junum.com.

     The Company believes that this transaction is to its benefit in that a $350
million  face  value  non  performing debt portfolio that eCard had insufficient
financial  resources  to convert into performing credit cards has been exchanged
for  shares  of  preferred  stock  potentially  convertible into up to 5,100,000
common shares of a publicly traded company. In addition, many aspects of Junum's
business  contain  similarities to the business plan of CASA (please see Note 10
of  the  audited  Company's Consolidated Financial Statements and comments above
under "Results of Operations for the Year Ended March 31, 2001"). However, there
can  be  no  assurance  as to the amount of Net Collections Junum will attain by
November  15, 2002 and the actual number of Preferred Shares, if any, eCard will
ultimately  be  able  to  convert  into  Junum  common  shares.

     Two directors of the Company serve on eCard's Board of directors, including
Jason Galanis, who has entered into a Consulting Agreement with Junum to provide
assistance  to  Junum  in marketing the Junum's membership offerings, as well as
various  other  products  and  services  to the general public as well as to the
account debtors with respect to the accounts which constitute the non-performing
credit  card  portfolios  owned  and  to  be  acquired  by  Junum.

     During the third quarter, the Company and Graybox, LLC ("Graybox") mutually
agreed to a termination of the Consulting Agreement entered into with Graybox in
August  2000.

     Also  during the third quarter, the Company's board of directors determined
that  it  was  in  the  Company's best interests to authorize the negotiation of
consulting  agreements with Mr. Steven Antebi ("Antebi"), an individual residing
in  the  state  of  California,  and Mr. David Bergstein, the Managing Member of
Graybox  ("Bergstein"),  an  individual residing in the state of California, and
all  transactions  contemplated by such agreements. A principal component in Mr.
Antebi's  and  Mr. Bergstein's consulting agreements was the issuance to each of
them  of  that  number of shares which equalled 9.9% of the Company's issued and
outstanding  common  stock  after  giving  effect  to  such  share  issuance.

     On  February  23, 2001, the Company issued 83,333 shares of common stock as
adjusted  for  splits)  to  each  Mr.  Antebi  and Mr. Bergstein pursuant to the
Consulting  Agreements.  Based  on  the trading price at the date of issuance of
$0.08  per  share,  each  consultant  received  consideration  of  approximately
$200,000  for  their services. Mr. Bergstein and Mr. Antebi assisted the Company
regarding  corporate  finance  advisory  services.  This  included  spending  a
substantial  amount  of  time  in  connection  with a strategic acquisition of a
competitor  of  ThemeWare  where  the


<PAGE>
consultants  rendered  a significant amount of advice as to structure, terms and
conditions  of  the  prospective  acquisition. No agreement was reached with the
acquiree  and  the  transaction was abandoned. As of August 9, 2001, neither Mr.
Antebi nor Mr. Bergstein currently performs consulting services for the Company.


SUBSEQUENT  EVENTS:

(a)  Reorganization

     On July 18, 2001, In connection with approving the revised business plan at
the  Board  Meeting,  the  Board  of Directors met and unanimously elected Jason
Galanis as President and CEO and, at the conclusion of the meeting, Chairman and
CEO  Harry Weitzel tendered his resignation along with Director George Pilallis.
Shortly  thereafter,  holders of a majority of the issued and outstanding Common
Stock  approved  certain  actions  by written consent including a name change to
Emergent  Financial  Group,  Inc.  and  a  1  for  30  reverse  stock  split.

(b)  Acquisition  of  KeyCom,  Inc.

     On  June  11,  2001,  the  Company  sold  an  aggregate of 150 Units, for a
purchase  price  of $1,000 per unit, to X-telligence Inc.  Each Unit consists of
6,666 shares of the Company's Common Stock, and a  five-year warrant to purchase
up  to  6,666 shares of the Company's Common Stock at an exercise price equal to
$0.15  per share.  The Units and warrants carry a 90-day reset provision whereby
the  purchase  price of the Units and the shares underlying the warrants will be
adjusted  to  the  lowest trading price of the Company's Common Stock for the 90
days  following June 11, 2001. The proceeds were used to fund an investment made
by  the  Company  in  Keycom.

     On  June 12, 2001, the Company purchased a one-year option in consideration
for  a  one-time non-refundable $150,000 payment, the Option Payment, to acquire
Keycom  for a fixed price equal to $25 million. The option was exercised on July
19,  2001  by  the  delivery of $25 million face value of the Company's Series E
preferred  stock pursuant to the Agreement and Plan of Reorganization dated July
19,  2001.

     On  July  19,  2001, the company consummated the acquisition of 100% of the
capital  stock  of  Keycom  Inc., located in Westlake Village, California for an
aggregate  purchase  price  of  $25  million.  The  purchase  price  was paid by
issuance  of 250,000 shares of the Company's of Series E preferred stock, with a
face  value  of  $100  per  share.  Keycom has developed proprietary transaction
processing software called Xtrans which enables data communication with existing
merchant  credit  card  terminals  in  order  to  receive,  record  and dispatch
instantaneously  small balance cash transactions nationally and internationally.

     On  July  31,  2001  Thesseus International Asset Fund, an entity partially
controlled  by  a  director  and the CEO of the Company, executed a Subscription
Agreement  with the Company to purchase up to 650 Units, for a purchase price of
$1,000  per  unit.  Each  Unit  consists of 6,666 shares of the Company's Common
Stock,  and a  five-year warrant to purchase up to 6,666 shares of the Company's
Common  Stock  at  an  exercise  price  equal to $0.15 per share.  The Units and
warrants  carry a 90-day reset provision whereby the purchase price of the Units
and  the  shares  underlying the warrants will be adjusted to the lowest trading
price of the Company's Common Stock for the 90 days following June 11, 2001.  As
of  August  7, 2001, a total of $400,000 of the $650,000 purchase price had been
was received by the Company.   The proceeds were used to fund an investment made
by  the  Company  in  Keycom.


<PAGE>
     On  August  7, 2001 Thesseus International Asset Fund executed an agreement
with  the  Company  to  pay  a  fee  of $100,000 as additional consideration for
modification of certain terms and clarification of other terms in regards to the
Series  A  preferred  shares  issued  on  November  11, 1999, including granting
two-for-one  voting rights to the holders of the Series A Preferred Stock, on an
as  converted basis, a requiring a 75-day notice period prior to conversion. The
fee  was  paid  to  the  Company  and proceeds were disbursed by the investor to
Keycom  for  the  benefit  of  the  Company,  as  described  below.

     On  August 7, 2001, pursuant to the Agreement and Plan of Merger dated July
19,  2001  with  Keycom, the Company used $500,000 of the proceeds obtained from
the  Thesseus  investments  to  acquire  $500,000  Zero-Coupon  Participating
Convertible  Debt  Certificates  from  Keycom. The debt certificates entitle the
Company  to  receive  repayment of its investment from predefined royalty income
and,  after  recovery  of  principal,  to  receive  a reduced royalty payment in
perpetuity.  Keycom  received  the  $500,000  on  August  7,  2001.

(c)  ThemeWare

     During  the  month  of  May 2001, Xtelligence, Inc., a Colorado Corporation
loaned the Company a total of $350,000.  The proceeds were primarily used by the
Company  to sustain the operations of ThemeWare, certain key vendors and certain
contractors  deemed  necessary  by  the  Company  and the lender to maintain the
integrity of the remaining operations representing the ThemeWare investment.  In
particular,  proceeds  were used to support fulfillment activities on a national
scale  of  a  product  order  with Staples Inc, a leading national office supply
store.  The  capital  was received as a bridge loan to the Company pursuant to a
senior  convertible  promissory  note  dated  June  1,  2000  and  disbursement
instructions  were provided to direct the loan proceeds to various entities. The
note  is  payable at 15% interest and matures in 90 days. The lender has default
remedies  that  include  the  right  to  purchase  up  to  5%  of  the  company.

(d)  Heritage  West

     On  August  1,  2001  the  Company  has  entered  into a Financial Advisory
Agreement with Heritage West Securities to provide investment banking advice and
related  mergers  and  acquisition professional services. The agreement is for a
one-year engagement and generally provides for fees to be paid upon consummation
of  acquisitions  or  financings.

     On  August  7,  2001,  the  Company  sold  an  aggregate of 50 Units, for a
purchase  price  of  $1,000  per  unit,  to  Heritage  West Holdings.  Each Unit
consists of 6,666 shares of the Company's Common Stock, and a  five-year warrant
to  purchase  up  to  2,000  shares of the Company's Common Stock at an exercise
price  equal  to  $0.15  per share.  The Units and warrants carry a 90-day reset
provision  whereby the purchase price of the Units and the shares underlying the
warrants  will  be  adjusted to the lowest trading price of the Company's Common
Stock for the 90 days following August 7, 2001. The proceeds of the subscription
were  disbursed  directly  to  KPMG  for  payment  of  services for the Company.


<PAGE>
(e)  Other

     During  the  month of July 2001, The Company had no source of liquidity, so
Jason  Galanis,  the  new  President  and  CEO  loaned  the Company  $50,000 for
accounting  and  other  related  services  pursuant  to  a  senior  convertible
promissory  note.  The  note  is payable at 15% interest and matures in 90 days.

     In  July  2001, a third party investor acquired Starfish and the associated
loans,  including  those  owed  to  Daimyo  and  Graybox.  All  of the notes are
currently in default. The company has reached a preliminary forbearance with the
creditor to provide sufficient time to reorganize the repayment schedule. Formal
forbearance  agreements are currently being negotiated between the parties. This
is  anticipated  to  include the conversion of all, or substantially all, of the
defaulted  debt  to  approximately  20%  of  the outstanding common stock of the
Company  on  a  fully  diluted  basis.

     On  August  1,  2001,  the  company entered into a Letter of Intent with an
underwriter  detailing  a  proposed  underwriting  engagement for the Company of
$5,000,000.  The  Letter  of  Intent  is  not  a binding commitment to raise the
described  funds.  It is intended to express the terms and conditions negotiated
by  the  parties in anticipation of receiving a binding, or firm, commitment the
underwriter. Management anticipates finalization of the commitment no later than
August 31, 2001, which is conditional upon the recapitalization plan approved by
the  board of directors. The securities proposed to be offered, if any, will not
be  registered  under  the  Securities  Act  of 1933, as amended, and may not be
offered  or  sold  in  the  United  States  absent  a registration or applicable
exemption  from  registration  requirements.


                                       23
<PAGE>
RISKS  RELATED  TO  OUR  BUSINESS


THE  COMPANY IS IN DEFAULT WITH CERTAIN SECURED CREDITORS AND SUBJECT TO FURTHER
REMEDIES  THAT  MAY  BE  DAMAGING.

     As  previously  disclosed, the Company is in default under the terms of the
Starfish  notes  as  of  December  31, 2001. At March 31, 2001, the Company owes
$3,585,348 in aggregate under the notes. Some of the loans are secured by assets
of  the  Company,  which may be foreclosed upon if satisfactory arrangements are
not  reached  with  the  creditors.  In February, the Company had certain assets
(EAL)  foreclosed  on  in  a  public  sale  resulting  in a material loss to the
Company.  There  can  be  no  assurance  that this will not occur in the future.

POSSIBLE  ADVERSE  EFFECT  OF  PENNY  STOCK  RULES ON LIQUIDITY OF THE COMPANY'S
SECURITIES.

     The  SEC  regulations  define  a "penny stock" to be an equity security not
registered  on a national securities exchange or for which quotation information
is  disseminated  on the Nasdaq Stock Market that has a price of less than $5.00
per  share or an exercise price of less than $5.00 per share, subject to certain
exemptions.  For  any  transaction  involving  a penny stock, unless exempt, the
rules require delivery, prior to a transaction in a penny stock, of a disclosure
schedule  relating to the penny stock market.  Disclosure is also required to be
made  about  commissions  payable  to  both the broker-dealer and the registered
representative  and  current  quotations  for  the securities.  Finally, monthly
statements  are  required to be sent disclosing recent price information for the
penny  stock  held in the account and information on the limited market in penny
stocks.

     The  foregoing  required  penny  stock  restrictions  will not apply to the
Company's securities if such securities are listed on the Nasdaq SmallCap Market
and  have  certain  price  and  volume  information  provided  on  a current and
continuing  basis, or meet certain minimum net tangible assets or average return
criteria.  In  any event, even if the Company's securities were exempt from such
restrictions,  it  would  remain  subject  to Section 15(b)(6) of the Securities
Exchange  Act  of 1934, which gives the SEC the authority to prohibit any person
that  is  engaged in unlawful conduct while participating in a distribution of a
penny  stock  from  associating  with  a  broker-dealer  or  participating  in a
distribution of a penny stock, if the SEC finds that such a restriction would be
in the public interest. If the Company's securities were subject to the rules on
penny  stocks,  the  market  liquidity  for  the  Company's  securities could be
adversely  effected.


                                       24
<PAGE>
NOTES  HAVE  RECENTLY  BEEN  PURCHASED  BY  NEW  CREDITORS.

     In  July  2001, a third party investor acquired Starfish and the associated
loans,  including  those  owed  to  Daimyo  and  Graybox.  All  of the notes are
currently  in  default.  The  company has reached a preliminary forbearance with
the  creditor  to  provide sufficient time to reorganize the repayment schedule.
Formal  forbearance  agreements  are  currently  being  negotiated  between  the
parties.  This is anticipated to include the conversion of all, or substantially
all,  of the defaulted debt to approximately 20% of the outstanding common stock
of  the  Company  on  a  fully  diluted  basis.

DEFAULT  WITH  UNSECURED  CREDITORS.

     The  Company is in default with certain third parties which provided bridge
loans to the Company aggregating $290,000 and that matured thirteen months after
origination.  The notes have matured and were not repaid by the Company pursuant
to  their terms. The creditors may pursue certain collection remedies that would
negatively  impact  the Company. The Company does not believe it has defenses to
such  claims.  Current  management is attempting to negotiate new terms that may
include exchanging debt for equity. This would result in dilution to the current
shareholders.  Current  management has been in office for a short period of time
and  there  is  no  assurance  that  acceptable  terms  will  be  arranged.

ACCRUED  AND  UNPAID  TRADE  PAYABLES.

     The  Company has a significant number of unsecured trade creditors. Current
management  is  attempting  to  negotiate  definitive  agreement with individual
creditors. If the Company is unsuccessful, the creditors could force the Company
into  an  involuntary  bankruptcy.

SEVERE  WORKING  CAPITAL  DEFICIENCY.


     The  Company  had  a  working  capital  deficiency  of  $5,356,000  and  an
accumulated  deficit  of  $21,109,216  at March 31, 2001. The Company expects to
remain  in a negative working capital position for the foreseeable future and if
it is unable to promptly raise additional funding to augment its working capital
position  it  will  not  be  able  to  continue  as  a  going  concern.


SHARE  PRICE  FOR  SECURITIES HAS BEEN SEVERELY DEPRESSED FOR AN EXTENDED PERIOD
WHICH  WILL  AFFECT  THE  ABILITY  OF  THE COMPANY TO ACCESS NEW EQUITY CAPITAL.

     The  Company's  securities have traded primarily under five cents per share
since  December  31,  2000. The Current management is exploring ways to increase
the  value  of  the Company's securities including developing certain investment
banking relationships. There is no assurance that this will occur or that, if it
did,  that  there  would  be  any  improvement  in  the  price  of the Company's
securities.

FLUCTUATIONS  IN  EMERGENT'S  STOCK  PRICE  IS  HIGHLY  LIKELY.

     Prior  to  November, 1999, there was no public market for Emergent's Common
Stock  and  currently there is only a limited market for these securities on the
NASDAQ  OTC  Bulletin Board.  Accordingly, the market price of Emergent's Common
Stock  has  been  highly  volatile.  Any  significant fluctuations in the future
might  result  in  a  general  decline  in the market price of Emergent's Common
Stock.


                                       25
<PAGE>
     The  price  at  which  Emergent's  Common Stock will trade in the future is
likely to be highly volatile and may fluctuate substantially due to factors such
as:

     -    Actual  or  anticipated  variations  in  quarterly  operating results;
     -    Announcements  of  technological  innovations;
     -    New  sales  formats  of  new  products  or  services;
     -    Changes  in  or  failure  to  meet  financial  estimates of securities
          analysts;
     -    Conditions  or  trends  in  the  financial  services  industry;
     -    Announcements  by  Emergent  or  its  competitors  of  significant
          acquisitions,  strategic  partnerships  or  joint  ventures;
     -    Capital  commitments;
     -    Additions  or  departures  of  key  personnel;  or
     -    Sales  of  Common  Stock.

     In  addition,  the  U.S.  stock  markets have from time to time experienced
significant  price  and  volume fluctuations that have affected the market price
for  the  common  stock of small- and micro-cap companies, particularly Internet
companies.  In  the past, these broad market fluctuations have been unrelated or
disproportionate  to the operating performance of these companies.  In the past,
following  periods  of  volatility in the market price of a particular company's
securities,  securities  class  action litigation has often been brought against
that  company.  Emergent  may  become involved in this type of litigation in the
future.  Litigation  is  often expensive and diverts the attention and resources
of  management,  which could cause Emergent's business, prospects and results of
operations  to  be  adversely  effected.

THE  COMPANY  HAS  RECENTLY  RAISED  CAPITAL  FROM A LIMITED GROUP OF INVESTORS,
INCLUDING  RELATED  PARTIES.

     A  major  objective  of Emergent is to raise sufficient capital to maintain
its  viability  as an ongoing concern.  The primary sources of cash to date have
been loans and preferred equity financing from related parties and distributions
from  EAL  pursuant to the MBDA.  The Company has recently raised capital from a
limited  number  of  new  investors. A substantial portion of the new investment
capital  raised  was from Thesseus International Asset Fund, a Company with whom
Mr.  Galanis  is affiliated. The terms of the new subscription were deemed to be
consistent  with  terms  that  would  be  offered  to third parties, however the
Company  has  been  unsuccessful  in  raising  similar  capital from the market.

NEW  MANAGEMENT  TEAM.

     On  November  11, 1999, the two existing directors of Emergent resigned and
appointed  Jason  W.  Galanis and Kevin L. Washington to replace them.  Prior to
this  event, the Company was inactive and had no material assets or liabilities.
On  November  19, 1999, Harry Weitzel was appointed Chairman and Chief Executive
Officer  joined  by  two additional Directors were appointed and on December 31,
1999, three final appointments were made, bringing the total number of Directors
to  eight.  The  Board  of  Directors  of the Company in July 2001 elected Jason
Galanis  as  President  and  CEO.  Mr.  Galanis had resigned from the Company in
September  2000  when  the Company undertook a previously disclosed new business
direction  and  has  had  no  day-to-day  affiliation with the Company since his
resignation.  On  July  18,  2001  Mr.  Galanis was appointed President CEO by a
unaninous vote of the board of directors. There can be no assurance that current
management  can  execute  the  existing  business  plan.


                                       26
<PAGE>
EMERGENT  IS  IN  DEFAULT OF A REGISTRATION RIGHTS AGREEMENT DATED SEPTEMBER 22,
2000.

     On  September  22,  2000,  the  Company  created  and issued 1,300 Series D
Preferred  Shares  with  a  stated  value  of  $1,000  each, which are generally
non-voting  and  not entitled to dividends, for $500,000 cash plus the return of
300,000  then  outstanding  Common Shares of the Company. The Series D Preferred
Shares  are  convertible  at any time, in an amount equal to the stated value of
the Series D Preferred Shares together with an Additional Amount calculated on a
daily basis at a rate of 4.5% per annum, into Common Shares of the Company based
on  a  value  of  80%  of  the then current market value of the Company's Common
Shares,  to  a maximum of $1.50 per Common Share.  The shares were subscribed to
by  an  institutional  investor,  International  Investment  Group.  The Company
simultaneously  executed a Registration Rights Agreement that generally provides
for  the  registration  of  common  shares into which the holder may convert its
preferred  stock.  During  the  reporting  period,  the Company took no steps to
register such shares pursuant to the Agreement and, as a result, is currently in
default. Current management is in discussions with the series D holder to obtain
forbearance  and  to  make  arrangements  to  cure  the default. There can be no
assurance  that  these  discussions  will  be  successful.

THE  SERIES  D  PREFERRED STOCK IS CONVERTIBLE INTO COMMON SHARES OF THE COMPANY
WITHOUT  A LOWER LIMIT ON THE NUMBER OF SHARES TO BE RECEIVED WHICH COULD RESULT
IN  SUBSTANTIAL  DILUTION  TO  THE  CURRENT  SHAREHOLDERS.

     The  Series  D  Preferred  Shares are convertible at any time, in an amount
equal  to  the  stated  value  of the Series D Preferred Shares together with an
Additional  Amount calculated on a daily basis at a rate of 4.5% per annum, into
Common  Shares of the Company based on a value of 80% of the then current market
value  of  the  Company's Common Shares, to a maximum of $1.50 per Common Share.
Based  on the $1,300,000 stated value of the series D preferred, the exercise of
any conversion right would result in substantial dilution to the shareholders at
current  market prices. The conversion rights may also further depress the price
of the Company's common securities as a consequence of having no practical fixed
limit  on the number of common shares into which the preferred may be converted.

EMERGENT HAS NO SIGNIFICANT OPERATING HISTORY UPON WHICH TO ASSESS THE VIABILITY
OF  ITS  BUSINESS  STRATEGY  OR  MANAGEMENT.

     Although  Emergent  has been in existence since 1994, it has no significant
operating  history  upon  which  its  current  management, business and business
plans,  and  prospects  may  be  evaluated.  In addition, Emergent only recently
installed  a  new  management  team  and  determined  to  pursue  a new business
strategy.  Furthermore,  Emergent's prospects must be considered in light of the
risks,  expenses  and  difficulties  frequently encountered by companies in new,
unproven  and  rapidly evolving markets.  To address these risks, Emergent must,
among  other  things:


                                       27
<PAGE>
     -    Develop  and  expand  its  cash  remittance  business;
     -    Respond  to  competitive  developments;
     -    Continue  to  attract,  retain  and  motivate qualified employees; and
     -    Continue  to  upgrade  its  technologies  and  identify  and  complete
          acquisitions  of  cash  remittance  and  related  businesses.

     There  can  be  no assurance that Emergent will be successful in addressing
these  risks  and  if  it  is  not  successful its ability to survive as a going
concern  will  be  adversely  affected.

EMERGENT  ANTICIPATES  INCURRING  LOSSES  FOR  THE  FORESEEABLE  FUTURE.

     Since  its  recent change in business strategy, Emergent has incurred costs
to  expand  its  business,  to  attract  qualified  employees and to upgrade and
improve  its  technologies.  As  a  result, the Company has incurred significant
losses  and  expects to continue to incur losses on a quarterly and annual basis
for  the  foreseeable future.  As of March 31, 2001, Emergent had an accumulated
deficit  of  approximately $18,090,000.  There can be no assurance that Emergent
will  be  able  to  generate  sufficient  revenues from operations to achieve or
maintain  profitability  on a quarterly or annual basis in the future.  Emergent
expects  negative  cash  flow  from  operations  to continue for the foreseeable
future.

EMERGENT  WILL REQUIRE ADDITIONAL LONG AND SHORT TERM FINANCING IN ORDER TO FUND
ITS  WORKING  CAPITAL  REQUIREMENTS,  IMPLEMENT  ITS  BUSINESS PLAN AND FUND THE
ACQUISITION  OF  ADDITIONAL  COMPANIES  AND  BUSINESSES.

     In  order  to fund its working capital requirements, implement its business
plan  and  fund  the  acquisition  of  additional  complementary  and  strategic
businesses, Emergent will require additional equity and/or debt financing in the
short-term  future.  Emergent  anticipates  that  it  will  need  to  raise
approximately  $30.0  million  over  the  next  12 to 18 months to implement its
business  plan  and  to  fund  the  amounts  to  be invested in Keycom and other
ventures.  Emergent  also  expects  that it will be required to raise additional
funds over the long term.  It may not be possible for Emergent to secure debt or
equity  financing  on  terms  acceptable  to  it  at the time that it seeks such
financing.  As  a  result  of  these  funding  needs, Emergent will need to seek
additional  external  debt  and/or  equity  financing.  Adequate  funds on terms
acceptable  to  Emergent,  whether  through  additional  equity  financing, debt
financing  or  other  sources, may not be available when needed or may result in
significant  dilution to existing shareholders.  If Emergent is unable to obtain
sufficient  funds from operations and external sources, Emergent may not be able
to  continue  as  a  going  concern.

IF  EMERGENT  IS  UNSUCCESSFUL  IN RE-NEGOTIATING ITS INVESTMENT COMMITMENT WITH
ECARD  SOLUTIONS,  IT  MAY  LOSE A PORTION OF ITS INVESTMENT IN ECARD SOLUTIONS.

     In  connection  with  the  Company's  purchase of eCard Solutions, Inc, the
Company  agreed  to pay the $1,000,000 purchase price for the Series B preferred
shares in four equal installments of $250,000 on March 13, 2000, April 13, 2000,
May  12,  2000  and June 12, 2000.  Failure to pay any of the installments could
result  in  forfeiture  of all or part of the Series B preferred stock and up to
$250,000  in  prior installments paid by the Company.  As of June 28, 2000, only
$250,000 of the $1,000,000 purchase price had been paid.  On May 24, 2000, eCard
Solutions delivered Emergent a notice of default on its obligation.  Emergent is
currently  negotiating  with  eCard Solutions to restructure this transaction so
that  no further payments on the part of Emergent will be required; however, the
parties  have  not yet reached a formal agreement on this matter.  If Emergent's
negotiations  with  eCard  Solutions  are  not successful, eCard Solutions could
retain  the  $250,000  already paid, Emergent could be required to return all of
the  Series  B  preferred shares granted, and could possibly be subject to other
breach  of  contract  claims  made  on  behalf  of  eCard  Solutions.


                                       28
<PAGE>
EMERGENT  IS  ENTERING INTO NEW HIGH-RISK MARKETS AND ITS SUCCESS WILL DEPEND ON
PERFORMANCE  OF  ITS  INVESTMENTS  IN  COMPANIES  IN  THIS  MARKET.

     Emergent has entered into the moderate income cash remittance and financial
services  market which is still developing, speculative and uncertain.  Emergent
generally  faces  a  high degree of risk of failure and volatility in the market
price  of  its  securities.

BECAUSE  THE  BUSINESS  MODEL  PROPOSED BY EMERGENT IS UNPROVEN, IT IS UNCERTAIN
WHETHER  IT  WILL  SUCCEED.

     Emergent's  business  model is unproven. The success of Emergent's business
model  depends  on  acquiring  cash  remittance  businesses,  and  entering into
agreements  with  new  locations  to  expand  the  network  of  locations  where
Emergent's  customers can send and receive cash remittances.  If Emergent cannot
convince  potential  acquisition  targets and the owners of new locations of the
value of its business model, Emergent's ability to acquire additional businesses
and  attract  new  locations  will  be  adversely  affected  and its strategy of
expanding  its  cash-remittance  network  may not succeed, which would result in
Emergent's  business,  prospects  and  results  of  operations  to  be adversely
effected.

     Emergent's business also depends upon its ability to successfully integrate
new  acquisitions  into  its  business, which is uncertain.  Potential conflicts
among current management and employees with that of acquired businesses, as well
as  potential  conflicts  with  the  customers,  suppliers and creditors of such
acquired  businesses, all can have an adverse effect on the Company's ability to
successfully  integrate  acquired  businesses.  Economic, governmental, industry
and  internal  company  factors  outside  its control all can have an additional
adverse effect on the Company's financial condition and results of operations. A
significant  portion  of  Emergent's  assets  will  be  comprised  of  ownership
interests  in  its  subsidiaries.  It  is  expected  that,  from  time  to time,
Emergent's  investment in one or more subsidiaries could represent a significant
portion of its market capitalization. If Emergent's subsidiaries do not succeed,
the value of its assets will decline, which could result in Emergent's business,
prospects  and  results  of  operations  being  adversely  effected.

EARLY  STAGE  COMPANY  INVESTMENTS  ARE  PARTICULARLY  RISKY.

     Some  of the companies in which Emergent may acquire an interest are in the
early  stages  of  their  development.  Some  of  these  companies  may not have
commenced  material  operations,  and  consequently,  may not have any operating
history  upon  which  an evaluation of those companies can be based.  Emergent's
business  and  prospects  must  be  considered in light of the risk, expense and
difficulties  frequently  encountered  by  companies  in  an  early  stage  of
development,  particularly companies in new and rapidly evolving, as well as the
problems,  expenses,  difficulties,  complications  and  delays  frequently
encountered  in  connection with the investments in new business in general.  If
Emergent  is  unable  to  effectively  allocate  its resources and help grow the
businesses  of  its  subsidiaries,  its  business,  prospects  and  results  of
operations  may  be  adversely  effected.


                                       29
<PAGE>
IF  EMERGENT  IS UNABLE TO ASSEMBLE AND MAINTAIN THE REQUIRED KEY EMPLOYEES, ITS
ABILITY  TO  COMPETE  COULD  BE  HARMED.

     Emergent's success is dependent on the retention and successful performance
of  its  key personnel and the key personnel of its subsidiaries. If one or more
members  of  Emergent's  management, or the management of its subsidiaries, were
unable or unwilling to continue in their present positions, Emergent's business,
prospects  and  results  of  operations  may be adversely effected.  If existing
management  proves  inadequate  to the success of Emergent's business plan, then
Emergent  may  be  unable  to  find and hire additional qualified management and
professional  personnel  to help lead it or its subsidiaries because competition
for  managers  and  professionals  is  extremely  tight.

EMERGENT MAY BE UNABLE TO IMPLEMENT ITS INVESTMENT STRATEGY ON ACCEPTABLE TERMS.

     Emergent may have difficulty acquiring additional companies that complement
its  business strategy at acceptable prices.  This could occur for many reasons,
including:

     -    A failure to agree on the terms of the acquisition, such as the amount
     or  price  of  an  acquired  interest;
     -    Incompatibility  between  management  teams  of the target company and
          Emergent;
     -    Competition  from  other  acquirors  and
     -    A  lack  of  capital  on  acceptable  terms,  or at all, to acquire an
     interest  in  the  target  company.

     Many  of  the  acquiror  companies  with  which  Emergent  will compete for
anticipated  acquisitions  have  substantially  greater financial resources than
Emergent.  Emergent's  management is aggressively pursuing other acquisition and
investment opportunities, although, except as disclosed herein, it does not have
agreements  with  respect to any such opportunities.  There is no assurance that
any  of  these  opportunities  will  materialize.

EMERGENT  RECENTLY  COMPLETED  SIGNIFICANT  ACQUISITIONS  OF  BUSINESSES  AND
TECHNOLOGIES  AND  EMERGENT  MAY  MAKE OTHER BUSINESS ACQUISITIONS IN THE FUTURE
WHICH  MAY  BE DIFFICULT TO INTEGRATE INTO ITS EXISTING BUSINESS AND MAY DISRUPT
OR  NEGATIVELY  IMPACT  ITS  BUSINESS.

     Emergent  recently made, and expects to continue to make investments in and
acquisitions of complementary companies, technologies and assets that constitute
critical  aspects of its current and future business operations.  If it fails to
successfully integrate the operations of these companies, technologies or assets
into its business, Emergent may not be able to successfully execute its business
strategy.  Since  March  31, 2001, Emergent acquired Keycom, as described above.

This  and  any  future  acquisitions  may  result  in:

     -    Difficulties  in  assimilating  technologies,  products, personnel and
          operations;
     -    Diversion  of  management's  attention;


                                       30
<PAGE>
     -    Entering markets in which Emergent has no or limited prior experience;
     -    Loss  of  key  employees  of  acquired  organizations;  and
     -    Capital requirements in excess of what Emergent currently anticipates.

     In the future, acquiring companies, assets or technologies may also require
Emergent  to  make cash payments, assume debt, incur large write-offs related to
intangible  assets  and  issue  equity,  that  will  dilute ownership of current
stockholders  and  could  result  in  substantial  fluctuations in the Company's
results  of  operations  and  the  price  of  the  Company's  securities.

EMERGENT  COULD BECOME SUBJECT TO REGULATION UNDER THE INVESTMENT COMPANY ACT OF
1940  AND  ITS  BUSINESS DECISIONS MAY BE IMPACTED BY THIS ACT IF EMERGENT IS TO
REMAIN  UNREGULATED.

     Emergent  may  have to take certain actions to avoid inadvertently becoming
an  investment  company required to register under the Investment Company Act of
1940,  as  amended.  To  minimize  the  risk that it could be deemed a regulated
investment  company,  Emergent  intends  to primarily and actively engage in its
businesses  through  its majority owned subsidiaries.  Emergent believes that it
will  not  be  regulated  by  the  Investment  Company Act of 1940 as long as it
continues  to  be  primarily engaged in active businesses through majority-owned
subsidiaries  or controlled companies.  However, Emergent cannot be certain that
it  will  remain  exempt  from  the  registration requirements of the Investment
Company  Act  of  1940.  If  it  does not, Emergent may need to make significant
changes  to  its  business  activities.

     Generally,  a  company  must  register under the Investment Company Act and
comply  with  significant  restrictions  on  operations  and  transactions  with
affiliates  if  its  investment  securities  exceed  40%  of the company's total
assets,  or if it holds itself out as being primarily engaged in the business of
investing,  owning  or holding securities.  Under an alternative test, a company
is  not  required  to register under the Investment Company Act if not more than
45%  of  its total assets consist of, and not more than 45% of its net income is
derived  from,  securities  other  than  government securities and securities of
majority-owned  subsidiaries  and companies primarily controlled by it.  At this
time,  Emergent  intends  to  invest only in companies in which it will obtain a
majority  or  controlling  interest.

EMERGENT'S  INTERESTS  IN ITS SUBSIDIARIES IS EXPECTED TO CONTINUE TO BE HEAVILY
CONCENTRATED  ON  THE  FINANCIAL  SERVICES  MARKET,  AND, MORE SPECIFICALLY, THE
CASH-REMITTANCE  MARKET  AND  CERTAIN  ANCILLARY  MARKETS.

     The  success  of  Emergent  depends  on  the  development  of the financial
services  and  cash  remittance  market  for moderate income consumers, which is
speculative and uncertain.  The development of the financial service markets for
moderate income consumers is in the early stages. If widespread acceptance among
moderate-  and low-income consumers of Emergent's products and services does not
develop,  Emergent's  business,  prospects  and  results  of  operations  may be
adversely  effected.

INABILITY  OF  EMERGENT TO PROTECT INTELLECTUAL PROPERTY COULD IMPEDE GROWTH AND
VALUE.


                                       31
<PAGE>
     Some  of Emergent's subsidiaries may be unable to protect their proprietary
rights  and  may  infringe  on  the  proprietary rights of others.  In addition,
effective  patent,  copyright  and  trademark protection may be unenforceable or
limited  in  certain  countries.  Any  infringement on the intellectual property
rights of others, or any infringement on Emergent's intellectual property, could
cause  Emergent's  business, prospects and results of operations to be adversely
effected.

TECHNOLOGICAL  AND  EQUIPMENT  BREAKDOWNS  COULD  INTERRUPT AND ADVERSELY EFFECT
EMERGENT'S  BUSINESSES.

     Some of the Emergent's businesses depend on the efficient and uninterrupted
operation  of  their  computer  and  communications hardware systems and related
software.  Any  system  interruptions could cause Emergent's business, prospects
and results of operations to be adversely effected.   Interruptions could result
from  natural  disasters  as  well  as  power  loss, telecommunications failure,
violations  of  physical  and  electronic security measures, and similar events.

     Capacity  limits  on  some of Emergent's technology, transaction processing
systems  and  network hardware and software may be difficult to project and they
may  not  be able to expand and upgrade their systems to meet increased use.  As
Emergent's  customer base begins to increase, they must expand and upgrade their
technology,  transaction  processing  systems and network hardware and software.
Emergent  may be unable to accurately project the rate of increase in demand for
their  goods  and services.  In addition, Emergent may not be able to expand and
upgrade  its  systems  and  network  hardware  and  software  capabilities  to
accommodate  an  increased  customer  base,  and the operations and processes of
Emergent  may  be  disrupted.

EMERGENT'S  UNISSUED  PREFERRED  STOCK  MAY DETER POTENTIAL ACQUISITION BIDS FOR
EMERGENT'S  BUSINESS,  INCLUDING  BIDS  THAT  MAY BE BENEFICIAL TO SHAREHOLDERS.

     Emergent's  amended  and  restated certificate of incorporation permits its
board of directors to issue up to 25,000,000 shares of preferred stock in one or
more  series.  The board of directors can fix the number of shares of each class
and  the  voting  rights,  preferences,  limitations and special rights, if any,
without  any further vote or action by Emergent's stockholders.  The issuance of
shares  of preferred stock without further action by Emergent's stockholders may
delay  or  prevent  a  change in control transaction.  The issuance of shares of
preferred  stock  may  adversely  affect  shares of Common Stock held by current
shareholders.

DELAWARE  LAW  MAY  DETER POTENTIAL ACQUISITION BIDS FOR ITS BUSINESS, INCLUDING
BIDS  WHICH  MAY  BE  BENEFICIAL  TO  SHAREHOLDERS.

     Delaware  law may deter potential bidders for Emergent's business. Emergent
is  subject  to the anti-takeover provisions of the Delaware General Corporation
Law,  which regulates corporate acquisitions.  Delaware law prevents the Company
from  engaging  in  a  business  combination with any interested stockholder for
three  years  following  the  date  that  the  stockholder  became an interested
stockholder.  For  purposes  of  Delaware law, a business combination includes a
merger  or  consolidation  involving Emergent and the interested stockholder and
the  sale  of  more  than  10%  of  Emergent's assets.  In general, Delaware law
defines  an  interested  stockholder as any entity or person beneficially owning
15%  or  more of the outstanding voting stock of a corporation and any entity or
person  affiliated  with,  controlling  or  controlled by such entity or person.
Under  Delaware  law,  a  Delaware  corporation may opt out of the anti-takeover
provisions.  Emergent  does  not  intend  to  opt  out  of  these  anti-takeover
provisions.


                                       32
<PAGE>
CERTAIN  OF  THE  COMPANY'S  PREVIOUS ACQUISITIONS WERE ACQUIRED FROM AFFILIATED
PARTIES  AND  AS  A  RESULT  WERE  NOT  THE  RESULT OF ARMS-LENGTH NEGOTIATIONS.

     Several  of  the  members  of  Emergent's  management  team,  namely, Harry
Weitzel,  former  Chairman and Chief Executive Officer, Jason Galanis, Director,
President  and  Chief Executive Officer, and former Chief Operating Officer, and
Dr.  Rory  Knight,  a  former  director  of Emergent were principals of Thesseus
International  Asset  Fund,  NV  ("Thesseus"),  the  entity  from which Emergent
acquired  its  interests  in  EAL,  eCard  Solutions and InfoBase.  In addition,
Michael  Bodnar  was  the  CFO of Thesseus and was a director of a subsidiary of
Thesseus.  CASA  was  acquired  from  K.  Washington-Galanis Investments, LLC, a
company  controlled  by  Jason  Galanis  and Kevin Washington, an Executive Vice
President  and  director  of Emergent.  Therefore, the transactions were not the
result  of arms-length negotiations and the related agreements may include terms
and  conditions  that  may  be  more  or  less  favorable to Emergent than terms
contained  in  similar  agreements  negotiated  with  third  parties.

A  SIGNIFICANT  PORTION  OF  EMERGENT'S  OUTSTANDING COMMON STOCK AND ALL OF THE
SHARES  OF  PREFERRED STOCK ARE OWNED BY CERTAIN MEMBERS OF MANAGEMENT AND THEIR
AFFILIATES.

     Certain members of management of Emergent, indirectly through Thesseus, own
or  control, 100% of the outstanding Series A preferred stock of Emergent. As of
March  31, 2001, management beneficially owned approximately 19.7% of Emergent's
capital  stock  (on  a fully-diluted basis).  See "Security Ownership of Certain
Beneficial  Owners  and  Management." Together this person has sufficient voting
power  to  control the outcome of all corporate matters submitted to the vote of
shareholders,  including  the  election  of  directors,  changes in the size and
composition  of  the  Board of Directors, mergers, tender offers and open-market
purchase  programs  that  could give shareholders of Emergent the opportunity to
realize  a  premium  over the then-prevailing market price for their shares.  In
addition, the concentration of ownership in this entity and its affiliates could
have  the  effect  of delaying or preventing a change in control of Emergent and
may  affect  the  market  price  of  the  Common  Stock.

EMERGENT  DOES  NOT  INTEND  TO  PAY  CASH DIVIDENDS FOR THE FORESEEABLE FUTURE.

     Emergent has never declared or paid any cash dividends on its Common Stock.
Emergent  does  not  anticipate paying any cash dividends on its Common Stock in
the  foreseeable  future.


                                       33
<PAGE>
ITEM  8.      FINANCIAL  STATEMENTS


                                                                            PAGE
                                                                            ----

Report  of  Independent  Chartered  Accountants. . . . . . . . . . . . .      54

Consolidated  Balance  Sheets. . . . . . . . . . . . . . . . . . . . . .      55

Consolidated  Statements  of  Operations . . . . . . . . . . . . . . . .      56

Consolidated  Statements  of  Stockholders'  Equity. . . . . . . . . . .      57

Consolidated  Statements  of  Cash  Flows. . . . . . . . . . . . . . . .      59

Notes  to  Consolidated  Financial  Statements . . . . . . . . . . . . .      60


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

     Effective  January  11,  2000,  the  Company  determined  not  to renew its
engagement  with the accounting firm of Barry Friedman, P.C. and appointed KPMG,
LLP  as  its independent auditors.  There were no disagreements on any matter of
accounting  principles  or  practices,  financial  statement  presentation  or
disclosure,  or  auditing  scope  or  procedures  with  the  Company's  prior
accountants.  The  independent  accountants'  reports on the Company's financial
statements for the past two years did not contain an adverse opinion, disclaimer
of  opinion  nor  was it qualified or modified as to uncertainty, audit scope or
accounting  principles.  The  decision  to  change  certifying  accountants  was
approved  by  the  Company's  Board of Directors.  During the Company's two most
recent  fiscal years there were no disagreements or "reportable events" with the
Company's  former or current independent accountants on any matter of accounting
principles  or  practices,  financial statement disclosure, or auditing scope or
procedure.


                                       34
<PAGE>
                                    PART III

ITEM  10.  DIRECTORS,  EXECUTIVE  OFFICERS,  PROMOTERS  AND CONTROL PERSONS:
           -----------------------------------------------------------------
           COMPLIANCE  WITH  SECTION  16(A)  OF  THE  EXCHANGE  ACT
           --------------------------------------------------------

     The  Company's Amended and Restated Bylaws currently provide that the Board
shall  consist of not less than one nor more than nine directors and that within
these  limits  the number of directors shall be as established by the Board. The
Board  has  set  the  number  of  directors  at eight. The Company's Amended and
Restated Certificate of Incorporation provides that the Board of Directors shall
be  divided  into  three classes, having staggered terms of office, which are as
equal  in  number as possible. The Company's Board of Directors was divided into
three  classes  as  required  by  the  Amended  and  Restated  Certificate  of
Incorporation.  At  the  Annual  Meeting,  director  nominees will be elected to
serve  for  terms  of  one, two or three years depending upon the class in which
each  director  serves  or  until  their  successors  are elected and qualified.

     The  initial  directors  of  Class I, Michael Bodnar and Leighton A. Bloom,
have  been  nominated  to  serve  for terms of one year or until the 2001 Annual
Meeting  of Stockholders. As of August 9, 2001, Mr. Bodnar had resigned, and his
successor  had  not  been  appointed,  while  Mr.  Bloom continues to serve as a
director.  The  initial  directors  of  Class  II,  George C. Pilallis, Kevin L.
Washington and Dr. Rory F. Knight, have been nominated to serve for terms of two
years  or  until  the 2002 Annual Meeting of Stockholders. As of August 9, 2001,
Mssrs.  Pilallis and Rory Knight had resigned, and their successors had not been
appointed.  The  initial  directors  of  Class  III,  Harry J. Weitzel, Jason W.
Galanis  and  Nicholas  Wise,  have  been nominated to serve for a term of three
years  or  until  the 2003 Annual Meeting of Stockholders. As of August 9, 2001,
Mr. Weitzel had resigned, and his successor has not been appointed. Accordingly,
there  are  currently  four  vacancies  on  the board of directors, which can be
filled  by  majority vote of the remaining directors without shareholder action.
At  each  Annual  Meeting  of  Stockholders  following  the 2000 Annual Meeting,
elections  shall  be held to elect directors, whose term has expired, for a term
of  three  years  and  after  the  expiration  of such term, shall thereafter be
elected  every  three  years  for  a  three-year term. The Company's Amended and
Restated  Articles  of  Incorporation  does  not permit stockholders to cumulate
their  votes  for  the  election  of  directors.

     The  following  table sets forth certain information, as of August 9, 2001,
regarding  the  Company's  current  Board  of  Directors and executive officers.

<TABLE>
<CAPTION>
                                          Position(s) Held             Director  Term to
     Name              Age (1)             In the Company               Since    Expire
---------------------  -------  -------------------------------------  --------  -------
<S>                    <C>      <C>                                    <C>       <C>
Harry J. Weitzel (2)        62  Chairman and Chief Executive Officer       1999     2003
Jason W. Galanis(3)         31  President and Chief Executive Officer      1999     2003
Nicholas Wise               42  Director                                   1999     2003
Kevin L. Washington         28  Executive Vice President and Director      1999     2002
Dr. Rory F. Knight(2)       47  Director                                   1999     2002
George Pilallis(2)          52  Director                                   1999     2002
Michael Bodnar(2)           52  Director                                   1999     2001
Leighton Bloom              66  CTO, Director                              1999     2001


                                       35
<PAGE>
<FN>
---------------------------
(1)  As  of  August  9,  2001;
(2)  Directors  Pilallis and Weitzel resigned following the Board Meeting of July 18,
     2001.  Mr  Weitzel  concurrently  resigned  as  CEO.  Director  Bodnar  resigned
     effective  January  7,  2001.  Director Knight resigned effective March 2, 2001;
(3)  Director Galanis was unanimously voted as President and CEO on July 18, 2001. He
     previously  had  resigned  as  an  officer  on  September 12, 2000 as disclosed.
</TABLE>

     The  principal  occupation  of each director of the Company and each of the
named  executive  officers  is  set  forth  below. All directors have held their
present  position  for  at  least  five  years  unless  otherwise  indicated.

     Harry  J.  Weitzel.  During  the reporting period ended March 31, 2001, Mr.
Weitzel  served  as  Chief  Executive  officer  and Chairman of the Board of the
Company. He has resigned effective July 18, 2001. Mr. Weitzel  currently is, and
has  been  since  June  1998,  the  Managing  Principal of Cedar Cove  Advisors,
LLC,  a  private  investment  management  and financial advisory firm located in
Lexington  Park,  Maryland.  From  August  1996  to  May  1998 he was the CEO of
Pacific  Consumer Funding,  LLC, ("PCF") a major national  originator,  servicer
and  seller of sub-prime  consumer loans located in Dallas,  Texas.  Mr. Weitzel
continues  to  serve  as  a  consultant  to  Pacific USA  Holdings Corp.,  PCF's
parent.  From  January  1992  to  July  1996,  Mr.  Weitzel was President of the
Consumer  Asset  Management  Division  ("CAMD"),  formerly  CLS,  of  Electronic
Data  Systems  Corporation.  Under  Mr.  Weitzel's  direction,  CAMD  became  a
leading provider of consumer loan out-sourcing services in the United States and
actively  participated  with  clients  in  the  creation  of national  financial
conduits  for  various  types  of  consumer  loans.  Prior  to  joining  CAMD,
Mr.  Weitzel  was  with  MNC  Financial  Corporation  (a  major  commercial bank
holding  company)  for  30  years,  retiring as President of MNC Retail Services
Corporation,  its  consumer  finances  subsidiary.  While  at  MNC,  Mr. Weitzel
also  oversaw  its  international  merchant  banking  operation,  which  was
headquartered  in  London  and  served  as  Chairman  of  its  Luxembourg  bank
subsidiary.  He  also  served  as  a  director  of  MBNA  which, since 1982, has
developed  into  the  world's  third  largest  credit  card lender with over $50
billion  in  consumer  receivables.  Mr.  Weitzel was also a founder of Thesseus
and  has  served  as  a  director  since  its  inception.

     Jason  W.  Galanis  -  President and Chief Executive Officer, Director. Mr.
Galanis  became  President and a Director of the Company in November 1999, later
resigning in September 2000. He returned in July 2001 as the Company's President
and  Chief  Executive  officer.  Mr.  Galanis  is a principal of Vianden Capital
Management, L.L.C., the investment advisor to Thesseus International Asset Fund,
a  closed-end,  split  income  venture  capital  fund that he founded in 1997 to
invest  in early-stage financial services companies in North America and the UK.
Mr.  Galanis  has  also  served  as a director of Thesseus from February 9, 1998
until  April  10,  2000.  In  June 1992, he co-founded a credit card receivables
originator,  which  became  The  Credit  Store  (AMEX:  CDS).  He  completed the
Advanced  Management  Programme  at  Templeton  College,  Oxford  University.

     Nicholas  P. Wise -- Director. Mr. Wise became a Director of the Company in
December  1999.  Mr.  Wise  has  a  long career managing public policy issues in
Washington,  D.CHe  is  President and founder of the government affairs firm of
Wise  & Associates, Washington, D.C., specializing in legislative and regulatory
matters  before  the  Congress  and executive branch agencies, a position he has
held  since  January 1997. From 1983 until 1986, Mr. Wise was an attorney on the
staff  of  Senator  Mike DeWine (Rep: Ohio). He served as Senator DeWine's Chief
Counsel and Legislative Director from 1986 to 1989. From 1989 to 1992, he served
as  Deputy Assistant Attorney General at the Department of Justice, where he was
Attorney  General  Thornburgh's  liaison with Congress and to the Counsel to the
President.  Mr.  Wise  served  as Chief Strategist and Chief Counsel for Senator
DeWine  from  1992 through 1997.Mr. Wise earned his J.D. at Case Western Reserve
University  in  1983 and his B.A. (cum laude) at the University of Cincinnati in
1980.  Mr.  Wise  is  a  member  of  the  Ohio  and  Virginia  Bar.


                                       36
<PAGE>
     Dr.  Rory  F.  Knight--  Director. Dr, Knight was a director of the Company
during  the  reporting period ending March 31, 2001. He resigned effective March
2,  2001.  Dr.  Knight  is  founder  of  Oxford  Metrica,  an  independent  risk
management advisory firm. Dr. Knight was Dean of Templeton College, the graduate
business  school  at Oxford University, a position he has held since 1994. He is
also  a Fellow in Finance at Templeton College. Prior to coming to Oxford he was
the  Deputy Director of a foundation within the Swiss National Bank (the central
bank of Switzerland) from 1986 to 1994. In this capacity he worked directly with
the  Directorate and with the International Banking sector. Dr. Knight's work on
stockholder  value  has  been  published  internationally and includes the Value
Creation  Quotient  (VCQ),  his public company quantitative analysis. Dr. Knight
also  advises  a  number  of  multinational businesses and is on the board of an
international  investment  fund.

     Kevin Washington-- Director. Mr. Washington became Executive Vice President
and  Director of the Company in November 1999. Mr. Washington was a principal in
Olympic Holdings, a privately held equity securities investment and trading firm
with  offices  in  Los  Angeles  and  London.  He  is  a  founding  partner  of
KnightVianden  Capital,  an  Oxford  based financial services group founded with
Jason  Galanis  and  Dr.  Knight.  KnightVianden  Capital operates KnightVianden
Research  Associates  within Templeton (Oxford University) which focuses on risk
and  value  with  a  particular  focus  in biotechnology, Internet companies and
financial  services.  Mr.  Washington  is also a partner in a family partnership
which  has  interests  in  real  estate,  avionics  and  other  venture  capital
investments.

     Leighton  A.  Bloom  --  Chief  Technology  Officer and Director. Mr. Bloom
became  Chief  Technology  Officer and Director of the Company in November 1999.
Mr.  Bloom  is  currently and has been since 1998 a technology consultant to Key
Bank,  a  national  bank,  on  Internet  and  intranet information retrieval and
publishing.  He  is  currently employed as a technology consultant to Citigroup,
reporting  to  European  operations.  He  was  a senior technology consultant to
Chemical  Bank  and  its successor, Chase Manhattan Bank, from 1993 until August
1999,  developing  techniques  for  management  of,  and  information mining and
distribution  from,  very  large  investment  databases  in  support of private,
corporate  and  mutual  fund  asset  managers,  most  recently  for  intranet
publication. Previously, from 1991 to 1993, Mr. Bloom was a senior consultant to
Donaldson,  Lufkin  &  Jenrette  on  the  collection,  management  and  internal
publication  of  investment  banking  information;  to  Avon Corporation on data
mining  and  analysis  of marketing program effectiveness; and to Aetna, Inc. on
the  optimization  of  computer-based  corporate  health  care  customer service
interactions.  During 38 years in the computer industry, Mr. Bloom has developed
systems  for  several  other firms in the financial services industry as well as
firms  in  other  industries  that  include publishing, litigation, real estate,
natural  resources,  manufacturing,  transportation,  communications,  and
advertising.

     George  C.  Pilallis-During the reporting period ending March 31, 2001, Mr.
Pilallis  served as Executive Vice President and Director. He resigned effective
July  18, 2001. Mr. Pilallis joined the Company as Managing Director in December
1999  and  became  Executive  Vice President in February 2000. From June 1997 to
December  1999,  Mr.  Pilallis  was  President  and  Chief  Executive Officer of
Advantage  Funding  Group, Inc. a subsidiary of Pacific Consumer Funding ("PCF")
an  originator,  servicer  and  seller  of  non-prime  consumer loans located in
Boston,  Massachusetts.  Mr.  Pilallis  previously held the position of Managing
Director  for  PCF, a unit of Pacific USA Holdings Corp., a national originator,
servicer  and  seller  of non-prime consumer loans located in Dallas, Texas from
March  1997  to  January 1998. From June 1991 to February 1997, Mr. Pilallis was
Managing  Director  of Capital Markets of the Consumer Asset Management Division
("CAMD"),  formerly CLS Corporation, of Electronic Data Systems Corporation. Mr.
Pilallis  was  responsible for all aspects of consumer loan outsourcing services
for  capital  market  transactions,  particularly  those involving non-prime and
sub-prime  asset-backed  classes  in  automobile,  home equity and credit cards.
Prior  to  joining CAMD, Mr. Pilallis held a variety of executive positions with
SMS  Corporation, GE Capital Mortgage Insurance and the John H. Harland Company.

     Michael  Bodnar.  During  the  reporting  period  ended March 31, 2001, Mr.
Bodnar  had been Chief Financial Officer of the Company until his resignation on
January 7, 2001. He served as Chief Financial Officer of Thesseus since December
1997.  He  has  been a member of the British Columbia and Canadian Institutes of
Chartered  Accountants  since 1978. From June 1997 until he joined Thesseus, Mr.
Bodnar  was  Chief  Financial  Officer  of  a group of financial services sector
companies  with  offices  in  Vancouver that concentrated in the distressed debt
field. In this capacity, his responsibilities included overseeing the accounting
and  record  keeping  functions  for  a  portfolio  of  both  performing  and
non-performing  Visa(R)  and MasterCard(R) receivables. From March 1983 to April
1997  Mr.  Bodnar  was  Vice President, Finance for Wosk's Ltd., a major Western
Canadian  retailer  of furniture, appliances and electronics products, where his
responsibilities  included  overseeing  all areas of consumer finance, including
credit  card  programs.  From  1973 to 1983 he was a Senior Manager with KPMG in
its  Vancouver and New Westminster offices, where he performed audit and general
business  advisory  services.


                                       37
<PAGE>
Board,  Committees  and  Attendance  at  Meetings

     The  Board of Directors of the Company held five meetings during the fiscal
year  ended  March 31, 2001. During fiscal 2001, no director attended fewer than
75%  of  the aggregate of the total number of Board meetings on which he served.
No  committees  were  established  during  fiscal  2001.  The  following  is  a
description  of each of the committees of the Board of Directors of the Company.

     Audit  Committee.  The  members  of the Audit Committee are Mssrs. Galanis,
Bloom and Wise . The Audit Committee, which was established May 1, 2000, reviews
the  Company's  audited  financial  statements  and makes recommendations to the
Board  concerning  the  Company's  accounting  practices  and  policies  and the
selection  of  independent  accountants. The Audit Committee did not meet during
fiscal  2001.

Compensation  of  Directors

     General.  During fiscal 2001, non-employee directors of the Company did not
receive  any  compensation  for  meetings  attended.  The  Company  issued stock
options  to its non-employee directors which are presently exercisable.  Messrs.
Knight and Wise were granted options (1) to purchase 66,666 and 66,666 shares of
common  stock  at exercise prices of $0.60 and $60.00, respectively, as adjusted
for  splits.  The Board of Directors may determine to pay fees to members of the
Board  in  the future, although the amount of timing of payment of such fees has
not  yet  been  determined.

(1)  All  options  were  rescinded at the meeting of the Board of Directors by a
unanimous  vote.

SECTION  16(A)  BENEFICIAL  OWNERSHIP  REPORTING  COMPLIANCE

          Section  16(a)  of  the  Exchange  Act  ("Section 16(a)") requires the
Company's  directors, executive officers, and persons who own more than 10% of a
registered  class  of  the  Company's  equity  securities,  to file with the SEC
initial reports of ownership and reports of changes in ownership of Common Stock
and  other  equity  securities  of the Company.  Officers, directors and greater
than 10% stockholders are required by SEC regulation to furnish the Company with
copies  of  all  Section  16(a)  forms  they  file.

          To  the Company's knowledge, based solely on a review of the copies of
such  reports furnished to the Company and written representations that no other
reports  were  required, during the fiscal year ended March 31, 2001 all Section
16(a) filing requirements applicable to its officers, directors and greater than
10%  beneficial  owners  were  complied  with.

ITEM  11.  EXECUTIVE  COMPENSATION
           -----------------------

Executive  Compensation

         The  following table sets forth information regarding compensation paid
by  the  Company  and  its  subsidiaries to the Chief Executive Officer and each
Named  Officer.


                                       38
<PAGE>
<TABLE>
<CAPTION>
                           SUMMARY  COMPENSATION  TABLE


                                                         Long Term
                     Annual Compensation            Compensation Awards
                    ---------------------  -------------------------------------------
                                                                  Securities
                                                                  Underlying
Name and            Fiscal                  Other Annual    Options/       All Other
Principal Position   Year   Salary  Bonus  Compensation(1)  SARS (#)      Compensation
------------------  ------  ------  -----  ---------------  ------------  ------------
<S>                 <C>     <C>     <C>    <C>              <C>           <C>
Harry J. Weitzel      2001       0      0                0  66,666(2)(3)             0
Chairman and Chief    2000       0      0                0  66,666(2)(3)             0
Executive
Officer
<FN>
----------------------------
(1)  Excludes  perquisites  and  other  personal  benefits  that  do  not exceed
     $50,000  or  10%  of  each  officer's  total  salary  and  bonus.
(2)  Represents  options  to  purchase 66,666, as adjusted for splits, shares of
     common  stock  at  the exercise  price  of  $1.35.
(3)  On  July  18, 2001, the Board of directors unanimously voted to rescind the
     1999  Stock  Option Plan in its entirety which covers all previously issued
     options,  including  Director  Weitzel's  above.
</TABLE>

1999  Stock  Option  Plan

     The  Board  of  Directors  and  stockholders  holding  a  majority  of  the
outstanding  common stock of the Company have also adopted the 1999 Stock Option
Plan  (the  "Stock  Option Plan"), which provides for the issuance of options to
acquire  up  to  500,000 shares (as adjusted for the Company's December 30, 1999
and  August  2001  stock splits) of the Company's common stock.  As of March 31,
2000,  options  to  purchase  350,000  shares  (as  adjusted  for  the Company's
December  30, 1999 and August 2001 stock splits) had been granted. None of these
options  had  been  exercised  as of March 31, 2001. The purpose of Stock Option
Plan  is  provide  additional  financial  incentive  to officers, directors, key
employees  and  important  consultants of the Company (and its present or future
subsidiary  corporations).

     Certain  of  the  options issued under the Stock Option Plan may constitute
incentive  stock  options  within  the  meaning  of  Section 422 of the Internal
Revenue  Code  of  1986,  as  amended (the "Code"). The remainder of the options
issued  under  the Stock Option Plan will constitute nonqualified stock options.

     The  Stock  Option Plan is administered by the Board of Directors until the
Board  determines  to  establish an option committee (the "Committee") to do so.
Subject  to  the  express provisions of the Stock Option Plan, the Committee has
authority  to  interpret the Stock Option Plan and make all other determinations
necessary  or  advisable  for  the  administration of the Stock Option Plan. The
Committee  has  authority, subject to the express provisions of the Stock Option
Plan,  to  select  individuals  to  participate in the Stock Option Plan, and to
determine  the  number  of  shares subject to each option, the time at which the
option  is  to  be  granted,  the  type of option, the option period, the option
price,  and  the  manner  in  which the options become exercisable, and to adopt
other  provisions  as  it  deems  necessary  or  desirable.

     The  Stock Option Plan provides for the grant of options representing up to
an  aggregate  of  500,000  shares  of  common  stock,  subject to adjustment as
discussed  below.  If  an option granted under the Stock Option Plan expires, is
canceled,  or  terminates  unexercised  as  to any share of common stock subject
thereto, or such shares will again be available for purposes of the Stock Option
Plan.  In  the  event of any change in the outstanding shares of common stock of
the  Company  by  reason  of  any  stock  dividend  or  split, reorganization or
recapitalization,  merger,  dissolution,  combination  or  exchange of shares or
other  similar  corporate  change,  the number of shares of stock subject to the
Stock  Option  Plan  and  the  aggregate  number of shares in outstanding option
agreements  shall  be  equitably  adjusted  by  the  Committee.


                                       39
<PAGE>
     The  option price per share of common stock will be fixed by the Committee,
but  the  option price for incentive stock options will not be less than 100% of
the  fair  market  value  on  the date the option is granted. The Committee will
determine  the  expiration date of each option, but, in the case of an incentive
stock  option,  such  expiration date will not be later than ten years after the
date  of  grant.  No  option  shall be assignable or transferable by an optionee
except  by  will  or the laws of descent and may be exercised during the life of
the  optionee  only by the optionee, except that the Committee may determine the
extent and manner in which optionees may designate a beneficiary to exercise the
option  after  the  optionee's  death  or  transfer  any  option.

     The  Board  of  Directors may amend, suspend, or terminate the Stock Option
Plan  at  any  time.  Termination  of  the Stock Option Plan will not affect the
rights  of  optionees  under  options previously granted to them.  All unexpired
options  will  continue  until, by their own terms and conditions, they lapse or
terminate.  No  incentive  stock  options  may be granted after the tenth (10th)
anniversary  of  the  effective  date  of  the  Stock  Option  Plan.

ITEM  12.  SECURITY  OWNERSHIP  OF  CERTAIN  BENEFICIAL  OWNERS  AND  MANAGEMENT
           ---------------------------------------------------------------------


                      SECURITY OWNERSHIP OF MANAGEMENT AND
                            CERTAIN BENEFICIAL OWNERS

         The  following  table  sets forth, as of August 9, 2001, the beneficial
ownership  of  the  Company's  Common  Stock  (as  adjusted for all stock splits
through such date): (i) by each person known by the Company to be the beneficial
owner of five percent or more of the Company's outstanding Common Stock, (ii) by
each  director  of  the  Company,  (iii) by the chief executive officer and each
executive  officer whose compensation would have exceeded $100,000 during fiscal
2001 (the "Named Officers"), and (iv) by the directors and executive officers of
the  Company  as  a  group. Unless otherwise specified, all persons listed below
have sole voting and investment power with respect to their shares. The business
address  of  the  officers  of  the  Company  is  that  of  the  Company.

<TABLE>
<CAPTION>
                                  Number of                Number of
Name, Position and Address        Common Shares            Preferred Shares  Percent
Beneficial Owner                  Beneficially   Percent   Beneficially      of Class
                                  Owned (1)      of Class  Owned  (1)
--------------------------------  -------------  --------  ----------------  --------
<S>                               <C>            <C>       <C>               <C>
Thesseus International Asset
Fund  NV                             216,933(2)     19.7%      8,500,000(3)   100%
Zeelandia Office Park
16 Kaya W.F.G. (Jombi)
Mensing, Curacao,
Netherlands Antilles

Jason W. Galanis(4)                  216,933(2)     19.7%      8,500,000(3)   100%
President, Chief Executive Officer
and  Chairman

Kyle  Washington  (5)                 55,666         6.1%              -        -
10 Pemberton  Avenue
North Vancouver, B.C.
V7P 2R1

Directors and Executive
Officers as a Group                  216,933(2)     19.7%      8,500,000(3)   100%(1)
persons)  (x)


                                       40
<PAGE>
<FN>
-----------------------------------
(1)  The  securities  "beneficially  owned"  by  an individual are determined in
     accordance  with the definition of "beneficial ownership" set forth in Rule
     13d-3 promulgated by the SEC. Accordingly they may include securities owned
     by  or  for, among others, the wife and/or minor children or the individual
     and  any other relative who resides in the same home as such individual, as
     well as other securities as to which the individual has or shares voting or
     investment  power  or  has  the  right  to  acquire under outstanding stock
     options  or  convertible  securities  within 60 days after the date of this
     table.  Beneficial  ownership  may  be  disclaimed  as  to  certain  of the
     securities.
(2)  Includes  183,600  issuable  upon  conversion  of series A preferred stock,
     subject  to  anti-dilution  adjustments.  The  series  A preferred stock is
     convertible  into  20%  of  the  outstanding  common  shares.
(3)  Series  A  preferred  shares  includes 8,500,000 series a preferred shares.
(4)  Mr.  Galanis  is  a managing director of Thesseus and is a beneficiary of a
     family trust which beneficially owns majority of Thesseus. Includes 216,933
     shares of common stock, and 8.5 million shares of Series A preferred stock,
     beneficially  owned  by Thesseus. Trustkantoor Curacao, the Ernst and Young
     affiliate  which  is the resident director of Thesseus, has sole voting and
     dispositive  power  over the shares held by Thesseus. Jason W. Galanis is a
     one fourth beneficiary of a family trust that owns a majority of the voting
     capital  stock  of Thesseus. Mr. Galanis has no voting or dispositive power
     over  the  shares held by Thesseus. Until their resignation as of April 10,
     2000,  Harry  Weitzel,  Mr.  Galanis  and  Rory  Knight  were  directors of
     Thesseus.
(5)  Kevin  Washington  and  Kyle  Washington  are  brothers.
</TABLE>

ITEM  13.  CERTAIN  RELATIONSHIPS  AND  RELATED  TRANSACTIONS
           --------------------------------------------------

     Several  of  the  members of Emergent's current and former management team,
namely,  Harry  Weitzel,  Kevin  Washington and Jason Galanis, were, until their
resignation  on  April 10, 2000, principals in Thesseus International Asset Fund
NV  ("Thesseus"), the entity from which Emergent acquired its interests in Eikos
Acquisition Limited, eCard Solutions, Inc. (formerly Brunswick Capital Partners,
Inc.)  and  InfoBase  Direct  Marketing  Services,  Inc.  ("InfoBase"). Emergent
acquired  100%  of Eikos for 100,000 shares of common stock (as adjusted for the
December  1999  stock  split  and  the  August 2001 stock split) and 8.5 million
shares of Series A Preferred Stock.   The Series A Preferred Stock converts into
an  aggregate  of  20% of the outstanding Common Stock on a fully diluted basis.
Emergent also initially acquired from Thesseus, in exchange for 66,667 shares of
Common  Stock (as adjusted for the December 1999 stock split and the August 2001
stock  split), preferred stock convertible into 40% of the common stock of eCard
Solutions,  Inc. and preferred stock convertible into 49% of the common stock of
InfoBase.  As  a  result,  these  transactions  did  not result from arms-length
negotiations.  The  related agreements may include terms and conditions that may
be more or less favorable to Emergent than terms contained in similar agreements
negotiated with third parties. Michael Bodnar, a former officer of Emergent, was
an  officer  of  Thesseus  at  the  time  of  such  transactions.

     Thesseus  and  Emergent also have an informal arrangement pursuant to which
Emergent  reimburses  Thesseus for its pro rata share of administrative expenses
as  determined  by management. These administrative expenses include among other
things,  rent,  administrative  staff and office costs. During the 2000 and 2001
fiscal  years,  Emergent  paid  Thesseus $71,000 and $205,644, respectively, for
these  expenses.


                                       41
<PAGE>
     Kevin  Washington  and  Jason  Galanis  are  principals  of K. Washington -
Galanis  Investments  LLC,  from  which Emergent acquired 100% of CASA@Home.com,
Inc. for 133,333 shares of Common Stock (as adjusted for the December 1999 stock
split  and  the August 2001 stock split).  As a result, this transaction did not
result from arms-length negotiations and the related agreement may include terms
and  conditions  that  may  be more or less favorable to Emergent than the terms
contained  in  similar  agreements  negotiated  with  third  parties.

     In  order  to  fund  the initial advances to ThemeWare described above, the
Company  received  a  $1,000,000  loan from Derek M. Galanis, a brother of Jason
Galanis.  Subsequently,  on  July  7, 2000, Derek Galanis agreed to convert this
loan  into  1,000,000  non-voting,  non-redeemable,  Series  B,  8%  cumulative
preferred shares in return for 1,667 two year warrants each entitling the holder
to  acquire  one  common share for $75.000. The preferred shares are convertible
into  250,000  shares  of Common Stock, subject to anti-dilution provisions, and
the  dividends  on such preferred stock are convertible into Common Stock at the
average  market price of the Common Stock for the thirty trading days commencing
45  trading  days  prior  to  conversion.


                                       42
<PAGE>
                                     PART IV

ITEM  13.  EXHIBITS,  FINANCIAL  STATEMENT  SCHEDULES,  AND  REPORTS ON FORM 8-K
           ---------------------------------------------------------------------

               (A)  (1)     FINANCIAL  STATEMENTS:



               (A)  (2)     FINANCIAL  STATEMENT  SCHEDULES:

               None.

               (A)  (3)     EXHIBITS:


           EXHIBIT  NUMBER     DESCRIPTION
           ---------------     -----------


                                       43
<PAGE>
                                   SIGNATURES

     In  accordance with Section 13 or 15(d) of the Exchange Act, the registrant
has  caused this report to be signed on its behalf by the undersigned, thereunto
duly  authorized.

                               EMERGENT  FINANCIAL  GROUP,  INC.


Date: August 15, 2001      By: /s/ Jason  Galanis
                               -------------------
                               Name:  Jason  Galanis
                               Title: President and Chief Executive Officer
                                      (Duly  Authorized  Officer)


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

          /s/  Jason  W.  Galanis
          -----------------------
          Name:  Jason  W.  Galanis
          Title: President  and  Chief  Executive  Officer,  Director
          Date:  August  15,  2001

          /s/  Nicholas  Wise
          -------------------
          Name:  Nicholas  Wise
          Title: Director
          Date:  August  15,  2001

          /s/  Kevin  Washington
          ----------------------
          Name:  Kevin  L.  Washington
          Title: Director
          Date:  August  15,  2001

          /s/  Leighton  Bloom
          --------------------
          Name:  Leighton  Bloom
          Title: Chief  Technical  Officer  and  Director
          Date:  August  15,  2001


<PAGE>
                                  EXHIBIT INDEX
                                  -------------


EXHIBIT  NUMBER     DESCRIPTION
---------------     -----------

  2.1
  ---


<PAGE>
                                                                           DRAFT
                                                                  AUGUST 7, 2001




               Consolidated  Financial  Statements
               (Expressed  in  United  States  dollars)

               EMERGENT  FINANCIAL  GROUP,  INC.
               (Formerly  Inc.ubator  Capital,  Inc.)
               (A  Development  Stage  Enterprise)

               Years  ended  March  31,  2001  and  2000


<PAGE>

AUDITORS'  REPORT  TO  THE  STOCKHOLDERS

We  have  audited  the  consolidated balance sheets of Emergent Financial Group,
Inc.  (a  Development Stage Enterprise, formerly Inc.ubator Capital, Inc.) as at
March  31,  2001  and  2000  and  the  consolidated  statements  of  operations,
stockholders'  equity and cash flows for the years ended March 31, 2001 and 2000
and  for the period from incorporation on May 31, 1994 to March 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 auditing standards generally accepted
in  the  United  States  of  America.  Those  standards require that we plan and
perform  the  audit  to  obtain reasonable assurance about whether the financial
statements are free of material misstatement.  An audit includes examining, on a
test  basis,  evidence  supporting  the amounts and disclosures in the financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made  by  management,  as well as evaluating the overall
financial  statement  presentation.  We  believe  that  our  audits  provide  a
reasonable  basis  for  our  opinion.

In  our opinion, the consolidated financial statements referred to above present
fairly,  in  all  material respects, the financial position of the Company as at
March 31, 2001 and 2000 and the results of its operations and its cash flows for
the years ended March 31, 2001 and 2000 and for the period from incorporation on
May  31,  1994  to  March  31,  2001  in  accordance  with accounting principles
generally  accepted  in  the  United  States  of  America.

The  accompanying  consolidated financial statements have been prepared assuming
that the Company will continue as a going concern.  As discussed in note 2(a) to
the  consolidated  financial  statements,  the  Company  has  a  working capital
deficiency, incurred a loss during the year and has not generated a profit since
incorporation.  These  factors,  among others, raise substantial doubt about the
Company's ability to continue as a going concern.  Management's plans in regards
to  these  matters  are also described in note 2(a).  The consolidated financial
statements  do not include any adjustments that might result from the outcome of
this  uncertainty.


                                    /s/  KPMG LLP
                                    --------------------------
                                    Chartered Accountants
                                    Vancouver, Canada

                                    August 10, 2001


<PAGE>
<TABLE>
<CAPTION>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Consolidated  Balance  Sheets
(Expressed  in  United  States  dollars)

March  31,  2001  and  2000

======================================================================================================
                                                                               2001           2000
------------------------------------------------------------------------------------------------------
<S>                                                                        <C>            <C>
Assets

Current assets:
    Cash                                                                   $          -   $    10,694
    Receivable from related parties (note 8(a))                                  81,053        24,540
    Refundable deposits                                                               -       150,000
    Prepaids                                                                      2,261        37,912
    --------------------------------------------------------------------------------------------------
                                                                                 83,314       223,146
Investments (note 3)                                                                  1    14,090,281
Intellectual capital                                                                  -         2,000
------------------------------------------------------------------------------------------------------
                                                                           $     83,315   $14,315,427
======================================================================================================

Liabilities and Stockholders' Equity
Current liabilities:
    Accounts payable and accrued liabilities                               $  1,295,405   $   455,779
    Payable to related parties (note 8(a))                                      232,187       183,322
    Note payable to eCard Solutions, Inc. (note 3(b))                                 -       750,000
    Notes payable (note 4)                                                      326,570             -
    Notes payable, Starfish Group, LLC (note 5)                               3,585,348             -
    --------------------------------------------------------------------------------------------------
                                                                              5,439,510     1,389,101
Notes payable (note 4)                                                                -       390,000
------------------------------------------------------------------------------------------------------
                                                                              5,439,510     1,779,101
Stockholders' equity:
    Share capital:
        Authorized:
            150,000,000 common shares with par value of $0.001
            25,000,000 preferred shares with par value of $0.001 (note 6)
        Issued and fully paid:
            8,500,000 (2000 - nil) series A, non-redeemable,
                voting convertible preferred shares                               8,500             -
            1,000,000 (2000 - nil) series B, non-redeemable,
              on-voting, 8% cumulative convertible preferred shares               1,000             -
            1,300 (2000 - nil) series D, redeemable, non-voting,
              convertible preferred shares                                            1             -
            908,500* (2000 - 655,167*) common shares                            909           588
    Common shares to be authorized and issued (note 3(b))                             -         2,000
    Preferred shares to be authorized and issued (note 3(a))                          -     6,592,494
    Additional paid-in capital                                               15,742,611     7,025,939
    Deficit accumulated during the development stage                        (21,109,216)   (1,084,695)
    --------------------------------------------------------------------------------------------------
                                                                             (5,356,195)   12,536,326
------------------------------------------------------------------------------------------------------
                                                                           $     83,315   $14,315,427
======================================================================================================
</TABLE>

*  Adjusted to reflect reverse split 30:1 on July 18, 2001

Going concern assumption (note 2(a))
Contingency (note 15)
Subsequent events (note 16)

See  accompanying  notes  to  consolidated  financial  statements.


                                                                               1
<PAGE>
<TABLE>
<CAPTION>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Consolidated  Statements  of  Operations
(Expressed  in  United  States  dollars)

===============================================================================================
                                                       Period from
                                                    incorporation on
                                                     May 31, 1994 to   Year ended   Year ended
                                                        March 31,       March 31,    March 31,
                                                          2001            2001         2000
-----------------------------------------------------------------------------------------------
<S>                                                 <C>                <C>          <C>
Revenue:
    Interest                                        $         183,796  $   183,216  $       580
    Foreign exchange                                            8,665        8,665            -
    -------------------------------------------------------------------------------------------
                                                              192,461      191,881          580

Expenses:
    Accounting and audit                                      154,325       81,825       72,500
    Administration fees (note 8(b))                           276,409      205,644       70,565
    Bad debts (note 3(c))                                      53,190       53,190            -
    Consulting                                              1,442,023    1,007,685      434,338
    Credit card fees and expenses                              45,055       15,611       29,444
    Equipment lease                                             4,168        4,168            -
    Interest                                                  367,098      367,098            -
    Legal                                                   1,250,530      885,642      364,888
    Marketing                                                  56,828       48,194        8,634
    Miscellaneous                                              19,861       12,281        4,002
    Payroll                                                    88,606       50,621       37,985
    Printing                                                   36,018       17,186       18,832
    Regulatory filings                                         17,032       13,466        3,566
    Rent                                                       36,580       36,580            -
    Stock transfer fees                                         8,600        2,934        5,666
    Telephone                                                  19,079       15,009        4,070
    Travel                                                     23,991       15,824        8,167
    Write-off of intellectual capital                           2,000        2,000            -
    Write-off of investment in eCard (note 3(b))              813,885      813,885            -
    Write-off of investment in InfoBase (note 3(c))           226,466      226,466            -
    Write-off of investment in Eikos Acquisition
      Limited (note 3(a))                                   6,107,994    6,107,994            -
    Write-off of ThemeWare note receivable (note 9(a))      3,791,524    3,791,524            -
    Write-off of Graphics Technology note receivable
      (note 9(b))                                             587,140      587,140            -
    -------------------------------------------------------------------------------------------
                                                           15,428,402   14,361,967    1,062,657
-----------------------------------------------------------------------------------------------
Loss before the following                                  15,235,941   14,170,088    1,062,077

Equity losses (note 12)                                     5,854,435    5,854,435            -
-----------------------------------------------------------------------------------------------

Loss for the period                                 $      21,090,376  $20,024,521  $ 1,062,077
===============================================================================================

Basic loss per share                                $          61.75*  $    29.63*  $     2.40*
===============================================================================================
Weighted average shares, basic and diluted                   344,232*     675,833*     442,122*
===============================================================================================
</TABLE>

*  Adjusted to reflect reverse split 30:1 on July 18, 2001 (note 2(f))

See  accompanying  notes  to  consolidated  financial  statements.


                                                                               2
<PAGE>
<TABLE>
<CAPTION>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Consolidated  Statements  of  Stockholders'  Equity
(Expressed  in  United  States  dollars)

Period  from  incorporation  on  May  31,  1994  to  March  31,  2001

=========================================================================================================================
                                                                                               Preferred       Common
                                                                                             shares to be   shares to be
                                                Common                Preferred               authorized     authorized
                                                shares    Par value    shares    Par value    and issued     and issued
-------------------------------------------------------------------------------------------------------------------------
<S>                                           <C>         <C>         <C>        <C>         <C>            <C>
June 14, 1994
  Shares issued for services at $0.001           100,000  $        1          -  $        -  $           -  $           -
-------------------------------------------------------------------------------------------------------------------------

Balance, March 31, 1995                          100,000           1          -           -              -              -
July 31, 1995
  Shares issued at $0.10                          37,000           -          -           -              -              -
Net loss, year ended March 31, 1996                    -           -          -           -              -              -
-------------------------------------------------------------------------------------------------------------------------

Balance, March 31, 1996                          137,000           1          -           -              -              -
Net loss, year ended March 31, 1997                    -           -          -           -              -              -
-------------------------------------------------------------------------------------------------------------------------

Balance, March 31, 1997                          137,000           1          -           -              -              -
December 2, 1997
  Acquisition of equity of Thesseus in Eikos           -           -          -           -     7,177,500*              -
February 28, 1998
  Shares issued for services at $0.001           100,000           1          -           -              -              -
February 28, 1998
  Forward stock split 45:1 at $0.00001        10,428,000         105          -           -              -              -
Net loss, year ended March 31, 1998                    -           -          -           -              -              -
-------------------------------------------------------------------------------------------------------------------------

Balance, March 31, 1998                       10,665,000         107          -           -      7,177,500              -
September 30, 1998
  Eikos distributions                                  -           -          -           -     (370,462)*              -
October 7, 1998
  Change par value from $0.00001 to
  $0.001                                               -      10,558          -           -              -              -
Net loss, year ended March 31, 1999                    -           -          -           -              -              -
-------------------------------------------------------------------------------------------------------------------------

Balance, March 31, 1999, carried forward      10,665,000      10,665          -           -      6,807,038              -


=========================================================================
                                               Additional
                                                paid-in      Accumulated
                                                capital        deficit
-------------------------------------------------------------------------
<S>                                           <C>           <C>
June 14, 1994
  Shares issued for services at $0.001        $        99   $          -
-------------------------------------------------------------------------

Balance, March 31, 1995                                99              -
July 31, 1995
  Shares issued at $0.10                            3,700              -
Net loss, year ended March 31, 1996                     -           (100)
-------------------------------------------------------------------------

Balance, March 31, 1996                             3,799           (100)
Net loss, year ended March 31, 1997                     -              -
-------------------------------------------------------------------------

Balance, March 31, 1997                             3,799           (100)
December 2, 1997
  Acquisition of equity of Thesseus in Eikos            -              -
February 28, 1998
  Shares issued for services at $0.001                 99              -
February 28, 1998
  Forward stock split 45:1 at $0.00001               (105)             -
Net loss, year ended March 31, 1998                     -           (100)
-------------------------------------------------------------------------

Balance, March 31, 1998                             3,793           (200)
September 30, 1998
  Eikos distributions                                   -              -
October 7, 1998
  Change par value from $0.00001 to
  $0.001                                           (3,793)        (6,765)
Net loss, year ended March 31, 1999                     -         (3,578)
-------------------------------------------------------------------------

Balance, March 31, 1999, carried forward                -        (10,543)
</TABLE>

*    The  transactions  prior  to  November  11,  1999  relate  to the Company's
     acquisition  of  the  equity  of  Thesseus in Eikos, and distributions from
     Eikos  paid  to  Thesseus  on  the  Company's  behalf  (note  3).


                                                                               3
<PAGE>
<TABLE>
<CAPTION>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Consolidated  Statements  of  Stockholders'  Equity  (Continued)
(Expressed  in  United  States  dollars)

Period  from  incorporation  on  May  31,  1994  to  March  31,  2001

============================================================================================================================
                                                                                                 Preferred        Common
                                                                                                shares to be   shares to be
                                                 Common                  Preferred               authorized     authorized
                                                 shares      Par value    shares    Par value    and issued     and issued
----------------------------------------------------------------------------------------------------------------------------
<S>                                            <C>          <C>          <C>        <C>         <C>            <C>
Balance, March 31, 1999, brought forward       10,665,000   $   10,665           -  $        -  $   6,807,038  $           -
September 14, 1999 at $0.001
  Cancellation of shares issued for services   (9,000,000)      (9,000)          -           -              -              -
September 16, 1999
  Forward stock split 2:1 at $0.001             1,665,000        1,665           -           -              -              -
September 28, 1999
  Forward stock split 1.5:1 at $0.001           1,665,000        1,665           -           -              -              -
November 10, 1999
  Eikos distributions                                   -            -           -           -     (214,544)*              -
November 11, 1999
  Shares issued on acquisition of
  CASA@Home, Inc. and
  Eikos Acquisition Limited at $0.001           3,500,000        3,500           -           -      6,592,494              -
December 29, 1999
  Shares issued - 50,000 for cash,
  200,000 for services at $0.50                   250,000          250           -           -              -              -
December 30, 1999
  Stock dividend at $0.001                      8,745,000        8,745           -           -              -              -
January 10, 2000
  Shares issued for services at $0.50              40,000           40           -           -              -              -
January 18, 2000
  Acquisition of investments in eCard
  Solutions, Inc. and InfoBase Direct
  Marketing Services, Inc. (2,000,000 shares)           -            -           -           -              -          2,000
January 24, 2000
  Payment for stock options                             -            -           -           -              -              -
February 14, 2000
  Shares issued for services at $0.50             125,000          125           -           -              -              -
Net loss, year ended March 31, 2000                     -            -           -           -              -              -
----------------------------------------------------------------------------------------------------------------------------

Balance, March 31, 2000, carried forward       17,655,000       17,655           -           -      6,592,494          2,000


=========================================================================
                                               Additional
                                                 paid-in     Accumulated
                                                 capital       deficit
-------------------------------------------------------------------------
<S>                                            <C>          <C>
Balance, March 31, 1999, brought forward       $         -  $    (10,543)
September 14, 1999 at $0.001
  Cancellation of shares issued for services         9,000             -
September 16, 1999
  Forward stock split 2:1 at $0.001                      -        (1,665)
September 28, 1999
  Forward stock split 1.5:1 at $0.001                    -        (1,665)
November 10, 1999
  Eikos distributions                                    -             -
November 11, 1999
  Shares issued on acquisition of
  CASA@Home, Inc. and
  Eikos Acquisition Limited at $0.001                    -             -
December 29, 1999
  Shares issued - 50,000 for cash,
  200,000 for services at $0.50                    124,750             -
December 30, 1999
  Stock dividend at $0.001                               -        (8,745)
January 10, 2000
  Shares issued for services at $0.50               19,960             -
January 18, 2000
  Acquisition of investments in eCard
  Solutions, Inc. and InfoBase Direct
  Marketing Services, Inc. (2,000,000 shares)    6,642,787             -
January 24, 2000
  Payment for stock options                        150,000             -
February 14, 2000
  Shares issued for services at $0.50               62,375             -
Net loss, year ended March 31, 2000                      -    (1,062,077)
-------------------------------------------------------------------------

Balance, March 31, 2000, carried forward         7,008,872    (1,084,695)
</TABLE>

*    The  transactions  prior  to  November  11,  1999  relate  to the Company's
     acquisition  of  the  equity  of  Thesseus in Eikos, and distributions from
     Eikos  paid  to  Thesseus  on  the  Company's  behalf  (note  3).


                                                                               4
<PAGE>
<TABLE>
<CAPTION>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Consolidated Statements of Stockholders' Equity (Continued)
(Expressed  in  United  States  dollars)

Period from incorporation on May 31, 1994 to March 31, 2001

=========================================================================================================================
                                                                                             Preferred         Common
                                                                                            shares to be    shares to be
                                            Common                  Preferred                authorized      authorized
                                            shares      Par value    shares    Par value     and issued      and issued
-------------------------------------------------------------------------------------------------------------------------
<S>                                       <C>          <C>          <C>        <C>         <C>             <C>
Balance, March 31, 2000, brought forward  17,655,000   $   17,655           -  $        -  $   6,592,494   $       2,000
Reverse stock split 30:1
  on July 18, 2001                       (17,066,500)     (17,067)          -           -              -               -
-------------------------------------------------------------------------------------------------------------------------
Balance, April 1 March 31, 2000              588,500          588           -           -  $   6,592,494   $       2,000
Shares issued to Thesseus International
  Asset Fund for Eikos Acquisition,
  eCard and InfoBase at $98.77**              66,666**         67   8,500,000       8,500     (6,592,494)         (2,000)
July 6, 2000
  Shareholder loan converted to B
    preferred stock                                -            -   1,000,000       1,000              -               -
September 22, 2000
  Issued Series D preferred stock                  -            -       1,300           1              -               -
  Retired common stock                       (10,000)**       (10)          -           -              -               -
February 23, 2001
  Shares issued for services at $2.40**      166,667**        167           -           -              -               -
February 26, 2001
  Shares issued for services at $2.40**       96,667**         97           -           -              -               -
Net loss, year ended March 31, 2001                -            -           -           -              -               -
-------------------------------------------------------------------------------------------------------------------------

Balance, March 31, 2001                      908,500   $      909   9,501,300  $    9,501  $           -   $           -
=========================================================================================================================


====================================================================
                                          Additional
                                            paid-in     Accumulated
                                            capital       deficit
--------------------------------------------------------------------
<S>                                       <C>          <C>
Balance, March 31, 2000, brought forward  $ 7,008,872  $ (1,084,695)
  Reverse stock split 30:1
  on July 18, 2001                             17,067             -
--------------------------------------------------------------------
Balance, April 1 March 31, 2000           $ 7,025,939  $ (1,084,695)
Shares issued to Thesseus International
  Asset Fund for Eikos Acquisition,
  eCard and InfoBase at $98.77**            6,585,927             -
July 6, 2000
  Shareholder loan converted to B
    preferred stock                           999,000             -
September 22, 2000
  Issued Series D preferred stock             500,009             -
  Retired common stock                              -             -
February 23, 2001
  Shares issued for services  at $2.40**      399,833             -
February 26, 2001
  Shares issued for services  at $2.40**      231,903             -
Net loss, year ended March 31, 2001                 -   (20,024,521)
--------------------------------------------------------------------

Balance, March 31, 2001                   $15,716,265  $(18,109,217)
====================================================================
</TABLE>

**  Adjusted to reflect reverse split 30:1 on July 18, 2001

See  accompanying  notes  to  consolidated  financial  statements.


                                                                               5
<PAGE>
<TABLE>
<CAPTION>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Consolidated  Statements  of  Cash  Flows
(Expressed  in  United  States  dollars)

==========================================================================================================
                                                              Period from
                                                            incorporation on
                                                            May 31, 1994 to     Year ended     Year ended
                                                               March 31,         March 31,     March 31,
                                                                  2001             2001           2000
----------------------------------------------------------------------------------------------------------
<S>                                                        <C>                 <C>            <C>
Cash flows from operating activities:
    Loss for the period                                    $     (21,090,376)  $(20,024,521)  $(1,062,077)
    Items not involving cash:
        Common shares issued for services                            814,700        632,000       182,500
        Payment of expense for stock options                         150,000              -       150,000
        Write-off of intellectual capital                              2,000          2,000             -
        Write-off of investment in eCard (note 3(b))                 813,885        813,885             -
        Write-off of investment in InfoBase (note 3(d))              226,466        226,466             -
        Write-off of investment in Eikos Acquisition
          Limited (note 3(a))                                      6,107,994      6,107,994             -
        Write-off of ThemeWare note receivable (note
          9(a))                                                    3,791,524      3,791,524             -
        Write-off of Graphics Technology note receivable
          (note 9(b))                                                587,140        587,140             -
        Equity losses (note 12)                                    5,854,435      5,854,435             -
    Changes in non-cash operating working capital:
        Increase in interest receivable                             (181,664)      (181,664)            -
        Decrease (increase) in refundable deposits                         -        150,000      (150,000)
        Decrease (increase) in prepaids                               (2,262)        35,651       (37,912)
        Increase in accounts payable
          and accrued liabilities                                  1,295,406        839,626       455,779
    ------------------------------------------------------------------------------------------------------
    Net cash used in operating activities                         (1,630,752)    (1,165,464)     (461,710)

Cash flows from investing activities:
    Notes receivable (notes 9(a) and (b))                         (4,197,000)    (4,197,000)            -
    Investment in eCard Solutions, Inc.                             (250,000)             -      (250,000)
    Distributions from Eikos Acquisition Limited                     486,000        337,500       148,500
    ------------------------------------------------------------------------------------------------------
    Net cash used in investing activities                         (3,961,000)    (3,859,500)     (101,500)

Cash flows from financing activities:
    Notes payable                                                    326,570        (63,430)      390,000
    Issuance of common shares                                         28,700              -        25,000
    Issuance of preferred shares                                   1,500,000      1,500,000             -
    Notes payable, Starfish Group, LLC                             3,585,348      3,585,348             -
    Advances from related parties, net                               151,134         (7,648)      158,782
    ------------------------------------------------------------------------------------------------------
    Net cash provided by financing activities                      5,591,752      5,014,270       573,782
----------------------------------------------------------------------------------------------------------

Increase (decrease) in cash                                                -        (10,694)       10,572

Cash, beginning of period                                                  -         10,694           122
----------------------------------------------------------------------------------------------------------

Cash, end of period                                        $               -   $          -   $    10,694
==========================================================================================================
</TABLE>


Supplementary  information  (note  9)

See  accompanying  notes  to  consolidated  financial  statements.


                                                                               6
<PAGE>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Notes  to  Consolidated  Financial  Statements
(Expressed  in  United  States  dollars)

Years  ended  March  31,  2001  and  2000

================================================================================

1.   GENERAL:

     Emergent  Financial  Group,  Inc.  ("Emergent"  or  the  "Company")  was
     incorporated on May 31, 1994 under the laws of the State of Delaware in the
     United  States  of  America  (the "United States"). The Company changed its
     name from Inc.ubator Capital, Inc. effective as of the filing of an amended
     and  restated  certificate  of  incorporation  on  July  25,  2001.

     Emergent  is  an  investor  in  technology-oriented  alternative  financial
     services  companies. Specifically, management attempts to identify emerging
     payment  technologies in the non-bank transaction processing and electronic
     payments  industries.  Card-based  technologies  and  services  such  as
     specialized credit card, debit card, chip-embedded (or "smart") card, other
     stored-value  cards  and  various  point-of-sale technologies are the focal
     point  of  the  investment  strategy.

     The  business  plan  is  to  invest  in or acquire a limited number of such
     companies  where there exist identifiable and immediate revenue streams and
     where  multiple  revenue  streams can be generated from each location where
     the  Company's  software  is  installed.  Revenue is, or will be, primarily
     derived from receiving a fee for providing basic financial services such as
     cash  remittance, cheque cashing, cash advances, specialized debit cards or
     prepaid telecommunications services. The Company seeks businesses that have
     developed  both  proprietary  technology  as  well as ones employing widely
     available  systems.  A  prerequisite  investment  criterion  is  that  the
     prospective electronic payments business plan has a fee-based revenue model
     with  no,  or  minimal,  continuing  credit  or  transaction risk exposure.

     The  Company's business strategy is to generate recurring fee-based revenue
     by developing a broad base of customers who access our services in familiar
     and  convenient  third-party  retail  locations.  As  the  Company  has not
     generated  significant  revenues  from  these  activities  since  its
     incorporation,  it  is  considered for financial reporting purposes to be a
     development stage enterprise. Being a development stage enterprise does not
     impact  the  accounting  principles  applied.

2.   SIGNIFICANT  ACCOUNTING  POLICIES:

     (a)  Going-concern  assumption:

          These  financial  statements  have  been  prepared  in accordance with
          generally accepted accounting principles in the United States that are
          applicable  to  a  going  concern,  which assume that the Company will
          continue its operations and be able to satisfy its obligations as they
          come  due through fiscal 2001. As at March 31, 2001, the Company has a
          working  capital  deficiency of $5,356,196, incurred a loss during the
          2001  fiscal  year of $20,024,521 and has not generated a profit since
          incorporation.  Future  operations  of  the  Company  depend  upon the
          continued  financial  support  of  stockholders  and common controlled
          companies.  Management  is  of  the  opinion  that  the  going concern
          assumption  is  appropriate,  and  is  currently  evaluating different
          alternatives  to  increase  the  Company's  capital  pursuant  to  the
          Agreement  and  Plan  of  Merger  dated  July 19, 2001 with Keycom. As
          disclosed  in  note  16, subsequent to March 31, 2001, the Company has
          taken  certain  steps  to  provide  additional  capital  to  finance
          operations.



                                                                               7
<PAGE>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Notes  to  Consolidated  Financial  Statements
(Expressed  in  United  States  dollars)

Years  ended  March  31,  2001  and  2000

================================================================================

2.   SIGNIFICANT  ACCOUNTING  POLICIES  (CONTINUED):

     (b)  Principles  of  consolidation:

          The  various  interests  that  the  Company  acquires  in its investee
          companies  are  accounted for under one of the following three methods
          as  appropriate in the circumstances: consolidation, equity method and
          cost  method. The applicable accounting method is generally determined
          by  the  Company's  voting  interest  in  each  company.

          These  consolidated  financial  statements include the accounts of the
          Company  and  its  wholly  owned  subsidiaries, Shanecy Holdings, Inc.
          ("SHI"),  Eikos  Acquisition  Limited  ("EAL")  and  CASA@Home,  Inc.
          ("CASA").  Companies  in which the Company directly or indirectly owns
          more  that  50%  of  the  outstanding  voting securities are generally
          accounted for under the consolidation method of accounting. Under this
          method,  an  investee  company's  results  of operations are reflected
          within  the  Company's  consolidated  statement  of  operations,  and
          inter-company  accounts and transactions are eliminated. Participation
          of  other  stockholders  in  the  earnings or losses of a consolidated
          investee  company  that  is  not wholly owned will be reflected in the
          caption "minority interest" in the Company's consolidated statement of
          operations.  Minority  interest  adjusts  the  Company's  consolidated
          earnings  (loss)  so that they only reflect the Company's share of the
          earnings  or  losses  of  the  consolidated  investee  company.

          Investee  companies whose results are not consolidated, but over which
          the  Company  exercises significant influence, are accounted for under
          the  equity method of accounting. Whether or not the Company exercises
          significant  influence  with respect to an investee company depends on
          an  evaluation  of  several  factors,  including representation on the
          investee  company's board of directors and ownership percentage, which
          is  generally  a  20%  to 50% interest in the voting securities of the
          investee  company,  including  voting  rights  associated  with  the
          Company's  holdings  of  common,  preferred  and  other  convertible
          instruments  in  the  investee  company.  Under  the  equity method of
          accounting,  the  investee company's accounts are not reflected within
          the  Company's  consolidated  financial  statements;  however,  the
          Company's  share  of  the earnings or loss of the investee company are
          reflected  in  the  caption "equity income (loss)" in the consolidated
          statement  of  operations. The Company's investees accounted for under
          the  equity  method have December 31 fiscal year ends, and accordingly
          in  the  Company's  annual  consolidated  financial statements it will
          record the investees' results of operations based on their fiscal year
          ended  immediately  preceding  March  31.  The excess of cost over net
          assets  acquired for equity accounted investments will be amortized to
          earnings  on  a  straight-line  basis  over  ten  years.

          Investee companies not accounted for under the consolidation or equity
          method  are  accounted  for under the cost method of accounting. Under
          this method the carrying value of long-term investments is cost unless
          there  is  a permanent impairment in value. The Company's share of the
          earnings  of  such companies will only be included in the consolidated
          statement  of  operations  to  the  extent  of dividends received from
          post-acquisition  retained  earnings  of  the  investee  company.


                                                                               8
<PAGE>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Notes  to  Consolidated  Financial  Statements
(Expressed  in  United  States  dollars)

Years  ended  March  31,  2001  and  2000

================================================================================

2.   SIGNIFICANT  ACCOUNTING  POLICIES  (CONTINUED):

     (c)  Measurement  uncertainty:

          Financial statements prepared in conformity with accounting principles
          generally  accepted  in  the  United States require management to make
          estimates  and  assumptions  that  can  affect the reported amounts of
          assets  and  liabilities and the disclosure of contingencies as at the
          date  of the balance sheet, and the revenue and expenses recognized in
          the period. Assumptions underlying asset valuations are limited by the
          availability  of  reliable  data  and  the  uncertainty of predictions
          concerning  future events. By their nature, asset valuations include a
          subjective element. Accordingly, amounts actually realized or incurred
          may  vary  from  recorded  amounts.

     (d)  Revenue  recognition:

          Payments received from Eikos Management LLC ("Eikos") under the Mutual
          Business  Development  Agreement  ("MBDA") are accounted for using the
          cost  recovery  basis,  whereby the full amount of the payment reduces
          the  carrying  value  of  the  investment. Payments received after the
          carrying  value has been reduced to zero will be recognized as revenue
          when  earned.

     (e)  Valuation  of  shares:

          Shares  issued  for  services  are  recorded  at the fair value of the
          services  rendered, unless not readily determinable, in which case the
          shares  are  valued  based  on  the most recent issuance of shares for
          cash.

     (f)  Earnings  (loss)  per  share:


          Basic  per  share amounts are calculated based on the weighted average
          number  of  shares  outstanding  and  give retroactive effect to stock
          splits,  stock  dividends  and share cancellations to the beginning of
          the  periods  presented.  Net  earnings  (loss)  per  share ("EPS") is
          computed  using  the  weighted  average  number  of  common  shares
          outstanding,  adjusted  to give effect to the reverse stock split 30:1
          on  July  18,  2001,  during the year of 675,833 (2000 - 442,122; from
          incorporation  on  May  31, 1994 to March 31, 2001 - 344,232). Diluted
          earnings  (loss)  per share does not differ from basic earnings (loss)
          per  share  as the effect of the exercise of options, warrants and the
          conversion  of  convertible  preferred  shares would be anti-dilutive.


                                                                               9
<PAGE>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Notes  to  Consolidated  Financial  Statements
(Expressed  in  United  States  dollars)

Years  ended  March  31,  2001  and  2000

================================================================================

2.   SIGNIFICANT  ACCOUNTING  POLICIES  (CONTINUED):

     (g)  Stock  options:

          The  Company  applies  the  intrinsic value-based method of accounting
          prescribed  by  Accounting  Principles  Board  ("APB") Opinion No. 25,
          "Accounting  for  Stock  Issued  to  Employees",  and  related
          interpretations,  in  accounting  for its fixed plan stock options. As
          such,  compensation  expense  is recorded on the date of grant only if
          the current market price of the underlying shares exceeds the exercise
          price.  SFAS  No.  123,  "Accounting  for  Stock-Based  Compensation",
          established  accounting  and  disclosure  requirements  using  a  fair
          value-based  method  of accounting for stock-based compensation plans.
          As  allowed  by  SFAS  No. 123, the Company has elected to continue to
          apply  the  intrinsic value-based method of accounting described above
          for  stock options granted to employees and directors, and has adopted
          the  disclosure  requirements  of SFAS No. 123. For options granted to
          others,  compensation  cost will be recognized equal to the fair value
          of the options as the services are provided and the options earned.


     (h)  Cash  and  cash  equivalents:

          For  the  purpose  of  the statements of cash flows, all highly liquid
          investments  with  an initial term to maturity of three months or less
          are  considered  to be cash equivalents. There are no cash equivalents
          as  at  March  31,  2001,  2000  or  1999.

     (i)  Income  taxes:

          Income  taxes  are accounted for under the asset and liability method.
          Deferred  tax assets and liabilities are recognized for the future tax
          consequences attributed to differences between the financial statement
          carrying  amounts  of  existing  assets  and  liabilities  and  their
          respective  tax  bases,  and  operating  loss  and  tax  credit  carry
          forwards.  Deferred  tax  assets  and  liabilities  are measured using
          enacted  tax rates expected to apply to taxable income in the years in
          which  those  temporary  differences  are  expected to be recovered or
          settled. The effect on deferred tax assets and liabilities of a change
          in  tax  rates is recognized in income in the period that includes the
          enactment  date.  When  it  is considered unlikely that a deferred tax
          asset  will  be  realized,  a  valuation  allowance  is  provided.

          The  Company,  SHI  and  CASA  are  subject  to taxation in the United
          States. EAL is subject to taxation in the country of its domicile, the
          Isle  of  Man.

     (j)  Foreign  currency:

          Monetary  items  denominated in a foreign currency are translated into
          United  States dollars, the Company's functional currency, at exchange
          rates  in effect at the balance sheet date, and non-monetary items are
          translated  at  rates  of  exchange  in  effect  when  the assets were
          acquired  or obligations incurred. Revenue and expenses are translated
          at  rates  in effect at the time of the transactions. Foreign exchange
          gains  and  losses  are  included  in  income.


                                                                              10
<PAGE>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Notes  to  Consolidated  Financial  Statements
(Expressed  in  United  States  dollars)

Years  ended  March  31,  2001  and  2000

================================================================================

2.   SIGNIFICANT  ACCOUNTING  POLICIES  (CONTINUED):

     (k)  Comparative  figures:

          Certain  of  the comparative figures have been reclassified to conform
          with  the  presentation  adopted  in  the  current  period.

3.   INVESTMENTS:

<TABLE>
<CAPTION>
=================================================================================
                                                           2001          2000
---------------------------------------------------------------------------------
<S>                                                    <C>           <C>
Cost recovery basis of accounting:
    Eikos                                         (a)  $         -   $  6,445,494

Equity basis of accounting:
    eCard Solutions, Inc. preferred shares:
        Series A                                  (b)            1      6,276,996
        Series B                                  (b)            -      1,000,000
    InfoBase Direct Marketing Services, Inc.      (c)            -        367,791
    -----------------------------------------------------------------------------
                                                                 1      7,644,787
---------------------------------------------------------------------------------

                                                       $         1   $ 14,090,281
=================================================================================
</TABLE>


     As at March 31, 2001, all of the above investments are accounted for by the
     cost  method.  These  investments were acquired from Thesseus International
     Asset  Fund  N.V. ("Thesseus"), (with the exception of the eCard Solutions,
     Inc.  Series  B  preferred shares), and were transferred at the book values
     previously  recorded by Thesseus. Thesseus is considered a related party by
     virtue  of  two  Company  directors  also  being,  directly and indirectly,
     stockholders  of  Thesseus.

     (a)  Eikos:

          The  Company,  through  its wholly owned subsidiary EAL, holds a 49.5%
          interest  in  Eikos.

          On  November  11, 1999, the Company acquired 100% of EAL from Thesseus
          in  exchange  for  50,000  common  shares  (as  adjusted for the stock
          splits)  and  8,500,000  convertible  preferred  shares  (subject  to
          adjustment for anti-dilution upon conversion) to be issued immediately
          after the Company's Articles of Incorporation are amended to authorize
          the Company to issue preferred shares. Such amendment occurred June 1,
          2000. Each preferred share is convertible into one common share of the
          Company.

          EAL  is  a  corporation  formed in October, 1999 under the laws of the
          Isle  of  Man.  The  sole asset of EAL, as described below, is a 49.5%
          equity  interest  in Eikos, which is recorded at its carrying value in
          EAL.  The  principal asset of Eikos is the MBDA dated October 8, 1996,
          as  amended  December  16, 1997 and September 1, 1998, with The Credit
          Store,  Inc. ("TCS"), an unrelated publicly-held Delaware corporation.
          TCS  is  a  nationwide  financial  services  company  engaged  in  the
          acquisition  and  recovery  of non-performing consumer receivables and
          the  origination and servicing of credit cards. It acquires portfolios
          of non-performing consumer receivables and originates new credit cards
          to  those  consumers  who satisfy certain credit criteria and agree to
          pay  all  or  a  portion  of the outstanding amount due on their debt.


                                                                              11
<PAGE>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Notes  to  Consolidated  Financial  Statements
(Expressed  in  United  States  dollars)

Years  ended  March  31,  2001  and  2000

================================================================================

3.   INVESTMENTS  (CONTINUED):

     (a)  Eikos  (continued):

          The  MBDA  entitles  Eikos to receive payments generally equal to five
          percent of certain monthly "performing" credit card production of TCS.
          The  aggregate  payments  to  Eikos  under  the  terms of the MBDA, as
          amended,  are  limited  to  a  maximum  of  $24,000,000. Approximately
          $1,700,000  of  this  amount  had  been  paid  prior  to the Company's
          acquisition  of  EAL.

          As  amended  September  1, 1998, the MBDA obligates TCS to pay Eikos a
          monthly  royalty  payment of $75,000 in cash from June 1, 1999 through
          May  31,  2005,  plus  an additional $22,500 cash or, at the option of
          TCS,  $25,000 in performing credit card receivables with provision for
          a  final  balloon  payment  within  90  days  of  May  31,  2005.

          The monthly payment is accounted for on a cost recovery basis with the
          value  of  the  investment  in Eikos reduced for all payments received
          (see  note  2(d)). Eikos is administered by a brother of the Company's
          President.  Pursuant  to  an administration agreement dated August 31,
          1998,  The  Administrator  has  the  right to determine the amount and
          timing  of any distributions that may be made to the members of Eikos.

          The  Company  was in default on certain debt obligations incurred from
          the Starfish Group, including a note to the Daimyo Group (note 5). The
          notes  were  secured  by  a  first  lien on the assets of the Company,
          including  its wholly owned subsidiary, EAL. On February 17, 2001, the
          Daimyo Group exercised its rights pursuant to the note to foreclose on
          the collateral, as a remedy set forth in Section 6 of the note; all of
          the  Company's rights title and interest in and to 100 sales of common
          stock  in  Eikos  Acquisition  Limited,  an  Isle  of Man corporation.

          Public  notice  was given as published in a national newspaper and, on
          February 26, 2001, a public sale was conducted. The Daimyo Group being
          the  sole  bidding party, purchased all of the Company's rights, title
          and  interest  in  and  to 100 shares of stock in EAL was purchased in
          consideration  for  the  outstanding indebtedness, which represented a
          bid  price  of  $500,000. As a result, the Company has written off the
          investment  in  EAL  in  the  amount  of  $6,107,994.


                                                                              12
<PAGE>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Notes  to  Consolidated  Financial  Statements
(Expressed  in  United  States  dollars)

Years  ended  March  31,  2001  and  2000

================================================================================

3.   INVESTMENTS  (CONTINUED):

     (b)  eCard  Solutions,  Inc.:

          On  January  18,  2000,  the  Company acquired, through a wholly owned
          subsidiary,  Shanecy  Holdings,  Inc. ("SHI"), 400 preferred shares in
          eCard  Solutions,  Inc. ("eCard", formerly Brunswick Capital Partners,
          Inc.),  convertible  into  40%  of  the  common  stock  of eCard. This
          interest,  together with a preferred share interest in InfoBase Direct
          Marketing  Services,  Inc. ("InfoBase") (note 3(c)), was acquired from
          Thesseus through a merger, effective January 11, 2000, between SHI and
          a subsidiary of Thesseus, for which the Company agreed to issue 66,667
          common  shares  (as  adjusted  for  the stock splits) to Thesseus. The
          initial purchase agreement was revised to provide that delivery of the
          66,667 shares (as adjusted for the stock splits) would not be required
          until  the  filing  and  effectiveness  of  an  amended  and  restated
          certificate  of  incorporation  with  the  Secretary  of  the State of
          Delaware  to increase the Company's authorized capital, which occurred
          on  June  1,  2000.  The  investment was transferred at the book value
          previously  recorded  by  Thesseus  of  $6,276,996.

          In  a  recapitalization  effected on March 13, 2000, eCard created two
          separate  series  (A  and  B)  of  preferred  shares.  The  400 shares
          purchased  on January 18, 2000 were reclassified as Series A preferred
          shares.  The  Company  acquired 1,000,000 Series B preferred shares in
          eCard  for  $1,000,000,  to  be  paid  in  four  equal installments of
          $250,000  on  March  13,  April 13, May 12 and June 12, 2000. $750,000
          remained  as  a note payable at March 31, 2000. On May 24, 2000, eCard
          delivered  the  Company  a  notice of default on its obligation. As at
          March 31, 2001, none of the remaining installment payments on the note
          have  been  made  and the shares and initial investment are subject to
          forfeiture  under  the  Company's  agreement  with  eCard,  although
          management has indicated an intention, on the part of both parties, to
          renegotiate  the  terms  of  the  Company's  investment  commitment.
          Subsequent  to  March  31,  2001  and  prior  to  August  10,  2001,
          renegotiations  over  the terms of the Company's investment commitment
          with  eCard  were  not  successful.  The  Company  has  determined  to
          write-off  the  investment  net  of  the  unpaid  balance of the note.

          In  addition, subsequent to March 31, 2001, management determined that
          the  carrying value of the eCard Series A Preferred Stock was impaired
          and  agreed,  after  consultation  with  its  auditors,  to  record  a
          write-down. eCard's primary asset is it's investment in Junum Series C
          Preferred Stock (see below for full description). The Company believes
          that  the  future value, if any, of the Junum Series C Preferred stock
          is  not determinable and the Company believes that eCard should record
          impairment  in  this  asset  as  noted  herein.  The  effect  of  such
          impairment  by eCard would be to increase equity losses of the Company
          by  $5,099,490. The revised carrying value in eCard is further reduced
          by  a  write-down  from  $563,886  to  $1,

          On  or  before  March  1,  2003, eCard can redeem, in whole but not in
          part, the Series B preferred shares for $1.00 per share. If the Series
          B  shares are not redeemed before March 1, 2003, Series A and Series B
          preferred  shares  held by the Company may be converted, at the option
          of  the  Company,  into 40% of eCard's outstanding common shares, on a
          fully-diluted  basis. If the Series B shares are redeemed before March
          1,  2003,  Series  A  preferred  shares may at any time after March 1,


                                                                              13
<PAGE>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Notes  to  Consolidated  Financial  Statements
(Expressed  in  United  States  dollars)

Years  ended  March  31,  2001  and  2000

================================================================================

          2003,  at  the option of the Company, be converted into 20% of eCard's
          outstanding  common  shares,  on  a  fully-diluted  basis.



                                                                              14
<PAGE>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Notes  to  Consolidated  Financial  Statements
(Expressed  in  United  States  dollars)

Years  ended  March  31,  2001  and  2000

================================================================================
3.   INVESTMENTS  (CONTINUED):

     (b)  eCard  Solutions,  Inc.  (continued):

          Effective  December  31,  2000,  eCard entered into a transaction with
          Junum Incorporated ("Junum") wherein eCard sold to Junum its inventory
          of  non-performing  debt  (the "Receivables") containing approximately
          189,000 individual accounts with a face value of $352,000,000, as well
          as  certain intellectual property and business systems relating to the
          conversion  of non-performing receivables into performing receivables.
          The  above  transactions  were completed pursuant to an Asset Purchase
          Agreement,  dated  as  of  December 31, 2000, by and between eCard and
          Junum. The purchase price of the assets was $5,100,000, payable in the
          form  of  5,100  shares  of  the Junum's series C preferred stock (the
          "Preferred  Stock").

          eCard  is entitled to convert each share of Preferred Stock into 1,000
          shares  of  common stock of Junum. While it holds the Preferred Stock,
          eCard  is not entitled to vote on matters submitted to shareholders of
          Junum,  except as required by law. The Preferred Stock issued to eCard
          Solutions,  and all shares of common stock issuable upon conversion of
          such  Preferred  Stock,  is not transferable for a period of 24 months
          following  the  closing  date without the prior written consent of the
          Junum. Each certificate representing such shares of Preferred Stock or
          common  stock  shall  contain  a  legend  describing such restriction.

          Junum  has  the  right,  at  any  time following November 15, 2002, to
          redeem for a redemption price of $0.10 per share of series C Preferred
          Stock,  plus  the Redemption Assignment (as defined below), all or any
          portion  of  the Preferred Stock, but only in the event Junum receives
          and  collects  less  than  $4,900,000  in  Net  Collections  from  the
          Receivables.  In  such event, on or after November 15, 2002, Junum has
          the right to redeem a number of shares of Preferred Stock equal to the
          difference  between  $4,900,000  and  the  Net  Collections.

          Net Collections means the amount of all balance transfers arising from
          conversion  of  debts constituting a part of the Receivables, plus the
          amount of actual cash collections received by Junum in satisfaction of
          any  portion  of  the  Receivables  that  are  not  considered balance
          transfers,  less  (i)  all direct operating costs of Junum relating to
          the  collection or conversion of the Receivables. A "balance transfer"
          refers  to the amount of debt agreed to be transferred to a new credit
          card  issued  by  or  through  Junum, and for which Junum or its agent
          receives  at  least  one  cash  payment  from  the  debtor.

          In  the  event  any  portion  of  the  Preferred  Stock is redeemed as
          described above, then Junum will transfer the Redemption Assignment to
          eCard  upon  receipt  of  the  certificates  evidencing  the  redeemed
          Preferred  Stock. The Redemption Assignment refers to an assignment of
          a  portion of the Receivables which have not been previously converted
          or  paid, equal to a fraction, the numerator of which is the number of
          shares  of  Preferred  Stock  redeemed  and  to  be  redeemed, and the
          denominator  of  which  is  equal  to  4,900.


                                                                              15
<PAGE>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Notes  to  Consolidated  Financial  Statements
(Expressed  in  United  States  dollars)

Years  ended  March  31,  2001  and  2000

================================================================================

3.   INVESTMENTS  (CONTINUED):

     (b)  eCard  Solutions,  Inc.  (continued):

          Two  directors  of the Company serve on eCard's Board of Directors and
          one  of  those  directors has entered into a consulting agreement with
          Junum  to  provide  assistance  to  Junum  in  marketing  the  Junum's
          membership  offerings,  as well as various other products and services
          to  the  general public as well as to the account debtors with respect
          to  the  accounts  which  constitute  the  non-performing  credit card
          portfolios  owned  and  to  be  acquired  by  Junum.

          The  financial  statements  of  eCard  prepared  by  management  (a
          Development  Stage  Enterprise)  as  at  December  31, 2000 show total
          stockholders' equity of approximately $4,700,000, total liabilities of
          approximately  $730,000  and total assets of approximately $5,400,000,
          substantially  all of which is represented by the investment in Junum.
          Stockholders'  equity  is net of a deficit of approximately $1,752,000
          accumulated  during the development stage. eCard has a working capital
          deficiency of $14,656, a loss for its 2000 fiscal year of $510,000 and
          has  not  generated  profit  since incorporation. Future operations of
          eCard  depend  on  the  continued  financial  support  of stockholders
          (including  Emergent)  and  common  controlled  companies. The Company
          believes  that  the  future  value,  if  any,  of  the  Junum Series C
          Preferred  Stock is not determinable and accordingly, increased equity
          losses  of the Company by $5,099,490 to reflect the impairment of this
          asset.

     (c)  InfoBase:

          On  January  18,  2000,  the  Company  acquired,  through  SHI,  4,900
          preferred  shares  in  InfoBase  convertible  into a 49% participating
          interest.  This  interest, together with a preferred share interest in
          eCard  (note  3(b)),  was  acquired  from  Thesseus  through a merger,
          effective  January 11, 2000, between SHI and a subsidiary of Thesseus,
          for  which  the  Company  agreed  to  issue  66,667  common shares (as
          adjusted  for  the  stock  splits)  to  Thesseus. The initial purchase
          agreement  was  revised  to provide that delivery of the 66,667 shares
          (as  adjusted  for  the  stock splits) would not be required until the
          filing  and  effectiveness  of  an amended and restated certificate of
          incorporation  with the Secretary of the State of Delaware to increase
          the  Company's authorized capital, which occurred on June 1, 2000. The
          investment  was  transferred  at the book value previously recorded by
          Thesseus  of  $367,791.


          InfoBase  is  an information-based, technology-driven direct marketing
          company  that  designs,  develops and implements sophisticated inbound
          and  outbound  marketing  programs  on behalf of credit card companies
          that  target the moderate-income consumer. In support of its marketing
          efforts,  InfoBase  has  developed  proprietary software to facilitate
          sophisticated  sales  tracking,  support  activities  such as customer
          service  and  order  processing,  data  mining,  neural  analysis  and
          database  management.


                                                                              16
<PAGE>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Notes  to  Consolidated  Financial  Statements
(Expressed  in  United  States  dollars)

Years  ended  March  31,  2001  and  2000

================================================================================

3.   INVESTMENTS  (CONTINUED):

     (c)  InfoBase  (continued):

          At  June  30, 2000, the carrying value of the investment was $226,466.
          InfoBase's  ability  to  carry  out  its business plan is dependent on
          receiving  additional  investments  from the Company. During the third
          quarter,  management  decided  that no additional investment should be
          made  in  InfoBase.  As  a  result,  the  Company  has written off the
          investment  at  the  June  carrying  value.  In  addition, the Company
          carries in its accounts receivable $53,190 that is due from an officer
          of  InfoBase.  It  has  been  determined  that  the  receivable  is
          uncollectible  and  it  was  also  been  written  off  at  year  end.

4.   NOTES  PAYABLE:

     Notes  payable  are  unsecured,  bear  interest  at 8% per annum payable on
     maturity  and  are repayable on April 27, 2001. $290,000 of these notes are
     payable  to  stockholders  of  the  Company.

     The  Company  was unable to repay the notes when they matured and is now in
     default  under  the  terms  and  conditions  of the notes. Negotiations are
     underway  to remedy the effects of the default. Pursuant to a restructuring
     plan  authorized by the Board on July 18, 2001, management is attempting to
     negotiate  new  terms  that  would  result  in the default being cured. The
     Company  is  seeking  to exchange debt for equity but there is no assurance
     that  this  effort  will  be  successful.

5.   NOTE  PAYABLE TO STARFISH GROUP, LLC, GRAYBOX, LLC, THE DAIMYO GROUP, INC.,
     COLLECTIVELY  "STARFISH":

     During  the  year  ended  March 31, 2001, the Company has received advances
     from  Starfish  totaling  $3,585,348.  The principal balance, together with
     interest  at  10%  per  annum,  was repayable in full on December 31, 2000.
     While  this  note  is outstanding, the Company is restricted from obtaining
     any  debt,  equity or other financing unless it is applied to the repayment
     of  this  note.  As  security for this note, the Company granted Starfish a
     security  interest  in  all  of  the  Company's existing assets as well as,
     during  the term of the Agreement, in any subsequently acquired stock, debt
     or  equity interest in any other corporation. For a period of one year from
     the  date  of  an  event of default (as defined), Starfish had the right to
     convert  amounts  owing  under  the  note  into  the  most  senior class of
     Preferred Stock of the Company that is convertible into common stock of the
     Company, as determined by the sole discretion of the Starfish, which common
     stock must then be registered pursuant to the Securities Act of 1933 within
     90  days  of  the  conversion.  Upon default, for each $1,000,000, and on a
     pro-rata  basis  for  any  amount less than $1,000,000, the lender would be
     entitled  to  common  stock  equal  to 5% of the Company's then outstanding
     common  stock  calculated  on  a  fully  diluted  basis.



                                                                              17
<PAGE>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Notes  to  Consolidated  Financial  Statements
(Expressed  in  United  States  dollars)

Years  ended  March  31,  2001  and  2000

================================================================================

5.   NOTE  PAYABLE TO STARFISH GROUP, LLC, GRAYBOX, LLC, THE DAIMYO GROUP, INC.,
     COLLECTIVELY  "STARFISH"  (CONTINUED):

     Starfish  Group, LLC is a Nevada limited liability company owned by a group
     of  investors,  none  of  whom  are officers or directors of the Company. A
     Director of the Company has provided a personal guarantee of $1,00,000 to a
     non-related  provider  of  funds  to  Starfish. The Daimyo Group, Inc. is a
     Nevada  corporation owned by a group investors none of whom are officers or
     Directors  of  the  Company.  Graybox,  LLC  is  a Nevada limited liability
     company  owned  by  a  group  of  investors,  none  of whom are officers or
     directors  of  the  Company.

     The  Company  was  unable  to repay the Starfish notes when they matured on
     December  31,  2000 and is now in default under the terms and conditions of
     the  notes.

     On  January 19, 2001, The Starfish Group, LLC presented a Notice of Default
     Under  Promissory  Note on monies loaned to the Company. Upon default under
     the note, the Company had 15 days within which to cure the default and that
     if the Company does not cure the default within 30 days, the holder has the
     right  to  seek  the  remedies  set  forth  in  the  note.

     On February 17, 2001, The Daimyo Group exercised its right, under the note,
     to  foreclose on the following collateral, as a remedy set forth in Section
     6  of  the  note;  all  of Debtor's right, title and interest in and to one
     hundred (100) shares of common stock, in Eikos Acquisition Limited, an Isle
     of  Man  corporation  (note  3(a)).

     On  July  3, 2001, Multivest LLC, an unrelated company, acquired all right,
     title  and  interest to the notes referred to collectively as the "Starfish
     Notes'  owed  by  the  Company.  They  also  agreed to a forbearance of the
     default pursuant to the terms of the notes and are taking no current action
     or  remedy.  The  Company  is  currently in negotiations to convert all, or
     substantially  all,  the debt to equity. However, there can be no assurance
     that  these  negotiations will be successful. Should Multivest LLC exercise
     its  rights  under  the  notes  and security interests granted, the Company
     would  be  not  be  able  to  continue  as  a  going  concern.

6.   PREFERENCE  SHARES:

     (a)  Series  A:

          At  March  31, 2001, the Series A convertible preferred shares are not
          entitled  to  receive  dividends.

     (b)  Series  B:

          On May 30, 2000, the Company received a loan from a shareholder who is
          a  brother  of a director of the Company. The loan bore interest at 8%
          payable  quarterly  in  arrears  commencing  September  1,  2000  and
          principal  was to be payable in full on July 1, 2001. Subsequently, on
          July  7,  2000,  the  shareholder  converted  this loan into 1,000,000
          non-voting,  non-redeemable, ,Series B, 8% cumulative preferred shares
          in  return  for  1,667  two-year  warrants  (as adjusted for the stock
          splits)  each  entitling  the  holder  to acquire one common share for
          $75.00  (as  adjusted  for the stock splits). The preferred shares are
          convertible  into  8,333  common  shares  (as  adjusted  for the stock
          splits),  subject  to  anti-dilution  provisions.

          At  March  31,  2001,  the  Series  B preferred shares have undeclared
          dividends  of  $58,740


                                                                              18
<PAGE>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Notes  to  Consolidated  Financial  Statements
(Expressed  in  United  States  dollars)

Years  ended  March  31,  2001  and  2000

================================================================================

6.   PREFERENCE  SHARES (continued):

     (c)  Series  C:

          On  October  8,  2000,  the  Board authorized the creation of Series C
          preferred  shares.  As  at March 31, 2001, no class C preferred shares
          have  been  issued.

     (d)  Series  D:

          On  September  22, 2000, the Company created and issued 1,300 Series D
          Preferred  Shares  with  a  stated  value  of  $1,000  each, which are
          generally  non-voting and not entitled to dividends, for $500,000 cash
          plus  the  return  of  10,000  (as adjusted for the stock splits) then
          outstanding  Common  Shares  of  the  Company.  The Series D Preferred
          Shares  are  convertible at any time, in an amount equal to the stated
          value  of  the  Series  D Preferred Shares together with an Additional
          Amount  calculated  on a daily basis at a rate of 4.5% per annum, into
          Common  Shares  of  the  Company  based  on a value of 80% of the then
          current  market  value of the Company's Common Shares, to a maximum of
          $45.00 (as adjusted for the stock splits) per Common Share. At any
          time  after  the  first anniversary of their issuance, the Company may
          redeem each Class D Preferred Share at a price equal to the greater of
          $1,400  plus  the Additional Amount and the market price of the Common
          Shares  into  which  such  Class  D  Preferred  Share  could  then  be
          converted.

7.   STOCK  OPTIONS  AND  WARRANTS:

     All  figures  are  adjusted to reflect reverse stock split 30:1 on July 18,
     ---------------------------------------------------------------------------
     2001
     ----

     (a)  Stock  Option  Plan:

          During  fiscal  2000,  the  1999  Stock  Option  Plan (the "Plan") was
          approved by the stockholders, whereby common shares of the Company may
          be  issued to designated employees, officers and directors pursuant to
          the  Plan,  as  approved by the Compensation Committee or the Board of
          Directors.  Subject  to  stockholder  approval  of  an increase in the
          authorized  share  capital  of  the Company, as at March 31, 2000, the
          Company  has  granted,  pursuant  to  the Plan, options to purchase an
          aggregate  of 350,000 (as adjusted for the stock splits) common shares
          to  certain officers and directors at exercise prices of between $1.20
          and  $60.00 per share. On April 24, 2000, the stockholders approved an
          increase  in  the  authorized  share capital of the Company, which was
          formalized  with  the filing of an amended and restated certificate of
          incorporation  on  June 1, 2000. Consequently, compensation expense in
          respect  of  these  options  as at the date of stockholder approval on
          April 24, 2000, equal to the excess at the date of the market value of
          the  Company's common shares over the exercise price, was $50,745,000.



                                                                              19
<PAGE>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Notes  to  Consolidated  Financial  Statements
(Expressed  in  United  States  dollars)

Years  ended  March  31,  2001  and  2000

================================================================================

7.   STOCK  OPTIONS  AND  WARRANTS  (CONTINUED):

     (a)  Stock  Option  Plan  (continued):

          The following table summarizes the status of options outstanding under
          the  Plan:

          ======================================================================
                                               Stock options         Weighted
                                                outstanding        average price
          ----------------------------------------------------------------------
          Outstanding, April 1, 1999 and 2000        350,000      $        12.60
          Granted during 2001                              -                   -
          Exercised during 2001                            -                   -
          Forfeited during 2001                      350,000                   -
          ----------------------------------------------------------------------

          Outstanding, March 31, 2001                350,000      $        12.60
          ======================================================================

          Exercisable, March 31, 2001                350,000
          ======================================================================

          The  following  table provides details of options outstanding at March
          31,  2001:

<TABLE>
<CAPTION>
========================================================================================
                   Number                                      Number
                 Outstanding    Weighted                     Exercisable
Range of          March 31,   average life      Weighted      March 31,      Weighted
exercise price      2001        remaining    average price      2001      average price
---------------  -----------  -------------  --------------  -----------  --------------
                                 (years)
<S>              <C>          <C>            <C>             <C>          <C>
$1.20 to $1.35       283,333            3.6  $         1.35      283,333  $         1.35
$60.00                66,667            8.5           60.00       66,667           60.00
---------------  -----------  -------------  --------------  -----------  --------------

                     350,000            4.5  $        12.60      350,000  $        12.60
========================================================================================
</TABLE>

          The  Plan  provides  that  the  Compensation Committee or the Board of
          Directors  may  determine  vesting  or  exercisability  of  any option
          granted,  but,  if  not otherwise determined, options will vest and be
          exercisable  at  the  date  of grant. The 350,000 options granted will
          terminate  on  the  earlier  of  five  or  ten years after the date of
          issuance  or  ninety  days  after the optionee ceases to be affiliated
          with  the  Company.

          On  July 18, 2001, the board of directors voted unanimously to rescind
          the 1999 company stock option plan, which generally provided for up to
          500,000  options  to  be  issued.

     (b)  Other  options:

          The  Company  has  issued  options to an unrelated party, which is not
          covered  by the 1999 Stock Option Plan, for consideration of $150,000.
          These  options were granted on January 24, 2000, are for 16,667 common
          shares,  have an exercise price of $210.00 and are exercisable for two
          years  from  the  date  of  grant.

          On  July 18, 2001, the Board of Directors voted unanimously to rescind
          all  other  options,  of  which  none  has  been  exercised  to  date.


                                                                              20
<PAGE>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Notes  to  Consolidated  Financial  Statements
(Expressed  in  United  States  dollars)

Years  ended  March  31,  2001  and  2000

================================================================================

7.   STOCK  OPTIONS  AND  WARRANTS  (CONTINUED):

     (c)  Warrants  to  purchase  shares:

          On  February  4,  2000,  the  Company  signed  an  Investment  Banking
          Agreement  with  Donner  Corp.  Pursuant to this agreement the Company
          issued, on February 8, 2000, 417 warrants to purchase common shares
          at  $360.00  per share.  The agreement also stipulated the issuance of
          three  additional  tranches  as  follows:

          -    417  warrants exercisable at $420, to be issued immediately after
               the  first day that the Company's Common Stock closes at or above
               $750;  and

          -    417  warrants exercisable at $480, to be issued immediately after
               the  first day that the Company's Common Stock closes at or above
               $1,050;  and

          -    417  warrants exercisable at $540, to be issued immediately after
               the  first day that the Company's Common Stock closes at or above
               $1,350.

          All  of  the  warrants  covered  by  this  agreement  are  no  longer
          exercisable  after  November  1,  2003.

          On  May  12,  2000,  in  consideration  for obtaining a listing on the
          Frankfurt  Stock  Exchange  and  for  ongoing  long-term market making
          sponsorship  services, the Company issued Berliner Reiverkehr warrants
          to  purchase  6,667 shares of its Common Stock, with an exercise price
          of  $210  per  share,  for a two-year term commencing on May 12, 2000.

          On May 16, 2000, the Company appointed Sabre Communications, Inc. as a
          management  advisor  with  responsibility  for investor relations, and
          issued them 6,667 cashless warrants bearing a strike price of $120 per
          share  exercisable  for  two  years  after  November  15,  2000.

          On May 22, 2000, the Company engaged Quadrant Investment Bankers, Inc.
          as  financial  advisor and placement agent and issued them warrants to
          purchase  3,333  shares  at  $120 per share, exercisable for two years
          after  November  22,  2000.

          On  July 18, 2001, the Board of Directors voted unanimously to rescind
          all outstanding warrants, of which no warrants were exercised to date.

8.   RELATED  PARTY  BALANCES  AND  TRANSACTIONS:

     (a)  Amounts  receivable  from/payable  to  related  parties are unsecured,
          non-interest  bearing  and  have  no  specific  terms  of  repayment.

     (b)  The  Company  was  charged $205,644 (2000 - $70,565) in administration
          fees by Thesseus Services Ltd., a wholly owned subsidiary of Thesseus.


                                                                              21
<PAGE>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Notes  to  Consolidated  Financial  Statements
(Expressed  in  United  States  dollars)

Years  ended  March  31,  2001  and  2000

================================================================================

9.   NOTES  RECEIVABLE:

     (a)  ThemeWare:

          On  May 22, 2000, the Company entered into a term sheet to acquire all
          of  the  outstanding  capital  stock  of  ThemeWare  Corporation
          ("ThemeWare")  in  exchange  for  $135,000,000 of the Company's common
          stock  and  a commitment to invest a total of $5,000,000 in ThemeWare,
          of  which  $1,000,000 was invested upon signing the term sheet on June
          2,  2000.  A  further  $1,000,000 was to be invested on the signing of
          definitive  agreements,  which  was  to take place in August 2000, and
          $1,000,000  is  to  be  invested  upon  the  Securities  and  Exchange
          Commission's  declaration  that the registration statement on Form S-4
          concerning  this  transaction is effective. The final $2,000,000 is to
          be  invested  within  twelve months of the closing of the transaction.

          On  August  25,  2000,  the  definitive  agreements  were  signed.
          Subsequently,  the  date  for  the  investment payment that was due on
          signing  was  modified by letter agreement and $1,500,000 was advanced
          in accordance with the modification. As at March 31, 2001, the Company
          has  advanced  a  total of $3,627,000. In return, ThemeWare executed a
          promissory  note  in  favor of the Company. The note bears interest at
          8%, with both principal and interest payable on demand. As the note is
          to  be  converted to equity on closing of the acquisition, it has been
          classified  as  a  long-term  asset  in  the accompanying consolidated
          balance  sheet.

          During  the  second  quarter  of  fiscal  2001, operational results at
          ThemeWare  deteriorated  significantly  and  as  a  result,  ThemeWare
          requested  funding  from  the  Company  beyond that which was required
          under  the  terms  of  its  definitive  purchase  agreement.

          During  the  fourth  quarter  of  fiscal 2001, ThemeWare significantly
          curtailed  its operations and released all but 11 of its 93 employees.
          The  Company  continued  to  seek  financing for ThemeWare during this
          period,  but  was  unsuccessful.  Subsequent  to  the  year-end, Jason
          Galanis,  then  acting only as a director of the Company, arranged for
          certain  unsecured  financing to be provided to ThemeWare from a third
          party.

          Subsequent to March 31, 2001, the operations of ThemeWare continued to
          deteriorate  and,  as  a  result, the Company no longer has reasonable
          assurance  that  ThemeWare  will  continue  as  a  going concern. As a
          result,  the Company has determined that no additional advances should
          be  made to ThemeWare and that the Company's note receivable should be
          written  off.  Accordingly, the principal of the note in the amount of
          $3,627,000  plus accumulated interest of $164,524 as of March 31, 2001
          has  been determined uncollectible and it has been written off at year
          end.


                                                                              22
<PAGE>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Notes  to  Consolidated  Financial  Statements
(Expressed  in  United  States  dollars)

Years  ended  March  31,  2001  and  2000

================================================================================

9.   NOTES  RECEIVABLE  (CONTINUED):

     (b)  Graphics  Technology,  Inc.  ("GTIX"):

          On  November  20,  2000,  the  Company  entered into an agreement with
          Graphics Technology, Inc. ( GTI") formerly known as Virtual Technology
          Corporation  (  VTC")  and  GTI  Acquisition Corporation ("GTI"), both
          Minnesota  corporations, referred to collectively as GTIX, under which
          the  Company  agreed  to  provide  GTIX  with  credit  financing up to
          $570,000  for  general  corporate purposes and to assume liability for
          the  payment  of  certain  of existing indebtedness of GTIX and/or its
          affiliates.  The  credit  financing is evidenced by a Credit Agreement
          (the  "Agreement"),  which  includes  all  necessary  documentation to
          provide the Company a perfected security interest in all of the assets
          of  GTIX.  As  of March 31, 2001, the Company has provided $570,000 in
          credit  financing  to  GTIX  under  the  Agreement.

          On  December  20, 2000 GTIX filed for Chapter 11 bankruptcy protection
          in  the  U.S.  Bankruptcy  Court,  District  of Minnesota, in order to
          facilitate restructuring its business. The Company is a first position
          creditor  in the reorganization proceeding and is currently discussing
          with  GTIX  various  options with regard to its restructuring so as to
          protect the Company's advances and facilitate GTIX's transition into a
          business-to-business  wholesale  technology  provider.

          During  the fourth quarter, the Company determined that GTIX's various
          restructuring options were unlikely to result in any material recovery
          for  the Company and so the recovery of the Company's advances were no
          longer  assured.  Therefore,  the  Company  has  written-off  the note
          receivable.  Additionally,  the  Company  carries  in  its  Interest
          Receivable  $17,140  as of March 31, 2001. It has also been determined
          that  the  receivable  is  uncollectible  and it has been written off.

10.  INVESTMENT  IN  CASA@HOME.COM  INC.  ("CASA"):

     In  November  1999,  the  Company  agreed  with  K.  Washington-Galanis
     Investments,  LLC  ("WGI"),  a  private  investment  entity controlled by a
     Company  director  and  a  shareholder,  to acquire 100% of CASA for 66,667
     common shares (as adjusted for the stock splits) of the Company. The shares
     were  issued  to 19 investors represented by WGI. The sole asset of CASA at
     the  date  of  acquisition  was certain intellectual capital and a business
     plan  for  an Internet-based provider of services. The Company carried this
     asset  at the par value of the shares issued which represents the cost base
     of the former owners. The ability of CASA to implement its business plan is
     dependent  on receiving additional investment from the Company. The Company
     has  been  unable to raise sufficient funds to invest in CASA and, to date,
     it  has  been  unable  to  implement  its plan. Since the Company cannot be
     certain whether it will be able to raise sufficient funds to permit CASA to
     implement  its business plan, during the third quarter it was determined to
     write  off  this  investment.



                                                                              23
<PAGE>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Notes  to  Consolidated  Financial  Statements
(Expressed  in  United  States  dollars)

Years  ended  March  31,  2001  and  2000

================================================================================

11.  INCOME  TAXES:

     A flat tax of 30 percent is imposed on a foreign corporation's gross income
     from  "Interest  (other  than original issue discount as defined in Section
     1273  of  U.S.  tax  law),  dividends,  rents,  salaries,  wages, premiums,
     annuities,  compensation,  remunerations,  emoluments,  and  other fixed or
     determinable  annual or periodical gains, profits, and income," but only to
     the  extent the amount is received from sources within the United States or
     is  effectively  connected  with the conduct of a trade or business by such
     corporation  within  the  United  States and which is received from sources
     outside  the  United  States.

     As of November 11, 1999, through its subsidiary EAL, the Company owns 49.5%
     of  the  equity  of  Eikos,  an Isle of Man limited liability company (note
     4(a)).  Eikos is a party to the MBDA with TCS, the successor to Service One
     International  Corporation under the MBDA, which operates within the United
     States.

     The  MBDA provides that Eikos is to provide certain consumer debt portfolio
     acquisition  and  financing services to TCS, outside the United States, and
     that  Eikos  is  to  treat income received under the MBDA as a distribution
     from  an  entity  taxed  as  a  partnership. It is possible that the United
     States  Internal  Revenue  Service  could assert that such income is income
     effectively connected to the United States. In the opinion of management of
     the  Company,  the  outcome  of  such assertion is not determinable at this
     time. However, the Company intends to treat any income from Eikos as exempt
     from  United  States  taxation  because it is earned in connection with the
     operations  of  Eikos  outside the United States. There is no provision for
     income  taxes  for  the  period  ended March 31, 2001. The Company has loss
     carry  forwards  of  approximately  $14,000,000.

================================================================================
                                                             2001        2000
--------------------------------------------------------------------------------

Future income tax asset related to loss carry forward    $4,760,000    $295,000
Valuation  allowance                                      4,760,000     295,000
--------------------------------------------------------------------------------

Future  income taxes per financial statements            $        -    $      -
================================================================================

12.  EQUITY  LOSSES:

     eCard  Solutions,  Inc.  ("eCard")  incurred  losses  of $5,609,323 for the
     twelve  months  ended  December  31,  2000,  including  a write-down of its
     investment  in  Junum  Series C Preferred Stock of $5,099,490. This amount,
     along  with amortization of the excess of cost over net assets acquired for
     the  twelve  months  of  $103,786  is  reflected  in  equity  losses in the
     consolidated  statements  of  operations. Commencing April 1, 2000, a total
     excess  of  $1,037,863  was  being  amortized  over  ten  years.

     InfoBase  Direct  Marketing  Services, Inc. ("InfoBase") incurred losses of
     $113,741 for the period up to which the Company wrote off the investment in
     InfoBase (note 3(c)). This amount, along with amortization of the excess of
     cost  over  net  assets  acquired  for  the  twelve  months  of $27,584, is
     reflected  in  equity  losses in the consolidated statements of operations.
     Commencing  April  1,  2000, a total excess of $340,207 was being amortized
     over  ten  years.


                                                                              24
<PAGE>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Notes  to  Consolidated  Financial  Statements
(Expressed  in  United  States  dollars)

Years  ended  March  31,  2001  and  2000

================================================================================

13.  SUPPLEMENTARY  CASH  FLOW  INFORMATION:

<TABLE>
<CAPTION>
======================================================================================================
                                                            Period from
                                                          incorporation on
                                                              May 31,
                                                              1994 to        Year ended    Year ended
                                                             March 31,        March 31,    March 31,
                                                                2001            2001          2000
------------------------------------------------------------------------------------------------------
<S>                                                      <C>                 <C>          <C>
Non-cash investing and financing activities:
    Common shares issued to unrelated parties on
      acquisition of CASA (note 3)                       $           2,000   $         -  $     2,000
    Common shares issued to Thesseus on
      acquisition of EAL (note 4(a))                                 1,500             -        1,500
    Eikos distributions received by Thesseus on behalf
      of the Company                                               585,006             -      214,544
    Preferred shares to be authorized and issued to
      Thesseus on acquisition of EAL                             6,592,494             -    6,592,494
    Common shares issued for services *                            184,500       632,000      182,500
    Common shares to be authorized and issued to
      Thesseus on acquisition of investments in
      eCard and InfoBase                                         6,644,787             -    6,644,787
    Note payable to eCard for investment in Series B
      preferred shares                                            (750,000)            -     (750,000)
    Conversion of shareholder loan to preferred shares           1,000,000     1,000,000            -
======================================================================================================
</TABLE>


*  Net  of  cancellation.

14.  COMMITMENTS:

     During  the  third  quarter  of  fiscal  2001, the Company and Graybox, LLC
     ("Graybox")  mutually  agreed  to a termination of the Consulting Agreement
     entered  into  with  Graybox  in  August  2000.

     Also  during  the  third  quarter  of  fiscal  2001, the Company's Board of
     Directors  determined  that  it  was  in  the  Company's  best interests to
     authorize  the  negotiation of Consulting Agreements with Mr. Steven Antebi
     ("Antebi"),  an  individual  residing  in  the state of California, and Mr.
     David  Bergstein,  the  Managing  Member  of  Graybox  ("Bergsteinj'),  an
     individual  residing  in  the  state  of  California,  and all transactions
     contemplated  by such agreements. A principal component in Mr. Antebi's and
     Mr.  Bergstein's Consulting Agreements will the issuance to each of them of
     that  number  of  shares  which will equal 9.9% of the Company's issued and
     outstanding  common stock shares after giving effect to such share issuance
     and filing of SEC Form S-8 Registration Statements in connection therewith.


                                                                              25
<PAGE>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Notes  to  Consolidated  Financial  Statements
(Expressed  in  United  States  dollars)

Years  ended  March  31,  2001  and  2000

================================================================================

14.  COMMITMENTS  (CONTINUED):

     On  February 23, 2001, the Company issued 83,333 shares of common stock (as
     adjusted  for  the  stock  splits)  to  each  Mr.  Antebi and Mr. Bergstein
     pursuant  to  the  Consulting Agreements. As of August 9, 2001, neither Mr.
     Antebi  nor  Mr.  Bergstein  currently performs consulting services for the
     Company.


15.  CONTINGENCIES:

     On  August  24,  2000,  a legal action was commenced against the Company by
     Incubator  Capital  Group, LLC ("ICGL") in the United States District Court
     for  the Southern District of New York. The claims are purportedly based on
     the  trademark rights of ICGL, for the Company's use of the name "Incubator
     Capital"  and  its  use  of the domain name "www.incubatorcapitalcorp.com".
     ICGL  has  filed  a  complaint  that  includes  causes  of action for False
     Designation of Origin, Unfair Competition, Federal Dilution, State Dilution
     and Deceptive Acts and Practices, which seeks injunctive relief and damages
     in  an  unspecified  amount.  This  matter  is  in its early stages, as the
     Company  and  ICGL  currently  are  in dispute regarding procedural issues,
     whereby  the  Company claims that is was not property served with a summons
     and  complaint.  ICGL has taken the position that service was effected, and
     that  it  will  seek  a  default  judgment for failure to file a responsive
     pleading.

     Currently  the Company has abandoned the use of the name Incubator Capital.
     Management  believes  that  this  litigation  will  be  settled in the near
     future.

16.  SUBSEQUENT  EVENTS:

     (a)  Reorganization:

          On  July  18, 2001, the Board of Directors met and unanimously elected
          Jason  Galanis  as  President  and  CEO  and, at the conclusion of the
          meeting, Chairman and CEO Harry Weitzel tendered his resignation along
          with  director  Pilallis.

          On August 2, 2001, holders of a majority of the issued and outstanding
          Common  Stock  approved certain actions by written consent including a
          name  change  to  Emergent Financial Group and a 1 for 30 stock split.
          The  Board  of  Directors  unanimously approved the action on July 18,
          2001.


                                                                              26
<PAGE>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Notes  to  Consolidated  Financial  Statements
(Expressed  in  United  States  dollars)

Years  ended  March  31,  2001  and  2000

================================================================================

16.  SUBSEQUENT  EVENTS  (CONTINUED):

     (b)  Acquisition  of  Keycom  Inc.

          On  June  12,  2001,  the  Company  purchased  a  one-year  option  in
          consideration  for  a  one-time  non-refundable  $150,000 payment, the
          Option  Payment,  to  acquire Keycom for a fixed price. The option was
          exercised  on  July 19, 2001 by the delivery of the Series E preferred
          stock  pursuant to the Agreement and Plan of Reorganization dated July
          19,  2001.

          On  July 19,  2001, the Company consummated the acquisition of 100% of
          the  capital  stock  of  Keycom  Inc.,  located  in  Westlake Village,
          California  for  an  aggregate  purchase  price  of  $25,000,000.  The
          purchase price was paid by issuance of 250,000 shares of the Company's
          of  Series  E  preferred  stock  with  a face value of $100 per share.
          Keycom  has  developed  proprietary  transaction  processing  software
          called  Xtrans which enables data communication with existing merchant
          credit  card  terminals in order to receive, record and dispatch small
          balance  cash  transactions  internationally.

          On  July  31,  2001  Thesseus  International  Asset  Fund,  an  entity
          partially which a director and the CEO of the Company, has significant
          beneficial  ownership  of  executed  a Subscription Agreement with the
          Company to purchase up to 650 units for a purchase price of $1,000 per
          unit. Each unit consists of 6,666 shares of the Company's common stock
          and  a  five  year  warrant  to  purchase  up  to  6,666 shares of the
          Company's  common stock at an exercise price equal to $0.15 per share.
          The units and warrants carry a 90-day reset provision. As of August 7,
          2001,  a  total  of  $400,000  of the $650,000 purchase price had been
          received  by the Company. The proceeds were used to fund an investment
          made  by  the  Company  in  Keycom.

          On  August  7,  2001  Thesseus  International  Asset  Fund executed an
          agreement  with  the  Company  to  pay a fee of $100,000 as additional
          consideration  for  modification of certain terms and clarification of
          other  terms  in  regards  to  the Series A preferred shares issued on
          November 11, 1999, including granting two-for-one voting rights to the
          holders  of  the Series A Preferred Stock, on an as converted basis, a
          requiring a 75-day notice period prior to conversion. The fee was paid
          to  the  Company and proceeds were disbursed by the investor to Keycom
          for  the  benefit  of  the  Company,  as  described  below.


                                                                              27
<PAGE>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Notes  to  Consolidated  Financial  Statements
(Expressed  in  United  States  dollars)

Years  ended  March  31,  2001  and  2000

================================================================================

16.  SUBSEQUENT  EVENTS  (CONTINUED):

     (b)  Acquisition  of  Keycom  Inc.  (continued):

          On  August 7, 2001, pursuant to the Agreement and Plan of Merger dated
          July  19,  2001 with Keycom, the Company used $500,000 of the proceeds
          obtained from the Thesseus investments to acquire $500,000 Zero-Coupon
          Participating  Convertible  Debt  Certificates.  The debt certificates
          entitle  the  Company  to  receive  repayment  of  its investment from
          predefined royalty income and, after recovery of principal, to receive
          a  reduced royalty payment in perpetuity. Keycom received the $500,000
          on  August  7,  2001.

     (c)  ThemeWare:

          During the month of May 2001 X-telligence, Inc. a Colorado corporation
          loaned  the  Company  a total of $350,000. The proceeds were primarily
          used  by  the  Company to sustain the operations of ThemeWare, certain
          key  vendors  and  certain contractors deemed necessary by the Company
          and  the  lender to maintain the integrity of the remaining operations
          representing  the  ThemeWare  investment. In particular, proceeds were
          used  to  support  fulfillment  activities on a national scale product
          order  with  Staples  Inc, a leading national office supply store. The
          capital  was  received  as  a  bridge  loan  to Emergent pursuant to a
          secured  convertible  promissory  note  dated  June  1,  2000  and
          disbursement instructions were provided to direct the loan proceeds to
          various  entities.  The note is payable at 15% interest and matures in
          90  days.  The  lender  has default remedies that include the right to
          purchase  up  to  5%  of  the  Company.

     (d)  Heritage  West  Group  of  Companies:

          On  August 1,  2001, the Company has entered into a Financial Advisory
          Agreement  with Heritage West Securities to provide investment banking
          advice  and related mergers and acquisition professional services. The
          agreements  for  a one-year engagement and generally provides for fees
          to  be  paid  upon  consummation  of  acquisitions  or  financings.

          On  August  7,  2001, the Company sold an aggregate of 50 Units, for a
          purchase  price  of  $1,000  per unit, to Heritage West Holdings. Each
          Unit  consists  of  6,666  shares of the Company's Common Stock, and a
          five-year  warrant  to  purchase  up  to 2,000 shares of the Company's
          Common  Stock at an exercise price equal to $0.15 per share. The Units
          and  warrants  carry  a  90-day  reset  provision  in  respect  to
          recapitalizations  or reverse splits. The proceeds of the subscription
          were  disbursed  directly  to  KPMG  for  payment  of services for the
          Company.



                                                                              28
<PAGE>
EMERGENT  FINANCIAL  GROUP,  INC.
(Formerly  Inc.ubator  Capital,  Inc.)
(A  Development  Stage  Enterprise)

Notes  to  Consolidated  Financial  Statements
(Expressed  in  United  States  dollars)

Years  ended  March  31,  2001  and  2000

================================================================================

16.  SUBSEQUENT  EVENTS  (CONTINUED):

     (e)  Other:

          During the month of July 2001, The Company had no source of liquidity,
          so Jason Galanis, the new President and CEO loaned the Company $50,000
          for  accounting  and  other  related  services  pursuant  to  a senior
          convertible  promissory  note. The note is payable at 15% interest and
          matures  in  90  days.

          On August 1, 2001, the company entered into a Letter of Intent with an
          underwriter  detailing  a  proposed  underwriting  engagement  for the
          Company  of  $5,000,000.  The  Letter  of  Intent  is  not  a  binding
          commitment to raise the described funds. It is intended to express the
          terms  and  conditions  negotiated  by  the parties in anticipation of
          receiving  a  binding, or firm, commitment the underwriter. Management
          anticipates  finalization  of  the commitment no later than August 31,
          2001,  which is conditional upon the recapitalization plan approved by
          the board of directors. The securities proposed to be offered, if any,
          will  not  be registered under the Securities Act of 1933, as amended,
          and  may  not  be  offered  or  sold  in  the  United  States absent a
          registration  or  applicable exemption from registration requirements.


<PAGE>