10QSB
                                      -----

                       Securities and Exchange Commission
                                Washington, D.C.

(Mark One)

[X]  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
     OF 1934
     For the quarterly period ended March 31, 2004


[ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934
     For the transition period from __________ to ____________


                                    000-07693
                                    ---------
                            (Commission file number)


                                  T & G 2, Inc.
                                  -------------
        (Exact name of small business issuer as specified in its charter)



            Nevada                                               13-4096315
            ------                                               ----------
 (State or other jurisdiction                                  (IRS Employer
 of incorporation or organization)                           Identification No.)


       1 Anderson Road, Suite 105
       Bernardsville, New Jersey                                   07924
       --------------------------                                ----------
(Address of principal executive offices)                         (Zip Code)


                                 (908) 204-9911
                                 --------------
                           (Issuer's telephone number)


                   ------------------------------------------
         (Former name, former address and former fiscal year, if changed
                               since last report)

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

                      APPLICABLE ONLY TO CORPORATE ISSUERS

     State the number of shares outstanding of each of the issuer's classes of
common equity, as of latest practicable date: Class A 118,555,744 shares of
Common Stock, $0.001 par value, as of May 15, 2003; 5,000,000 Class B $0.001 par
value as of May 15, 2003.

<PAGE>


                          PART I. FINANCIAL INFORMATION
                          -----------------------------

Item 1.   Financial Statements
------------------------------











                                  T & G2, INC.
                                AND SUBSIDIARIES
                   CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                             MARCH 31, 2004 AND 2003










































                                       F-1
<PAGE>






                          T & G2, INC. AND SUBSIDIARIES


              INDEX TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)






                                                                         Page
                                                                         ----

Balance Sheet as of March 31, 2004                                        F-3

Statements of Operations for the Three Months Ended
 March 31, 2004 and 2003                                                  F-4

Statements of Cash Flows for the Three Months Ended
 March 31, 2004 and 2003                                                  F-5

Notes to Condensed Consolidated Financial Statements                      F-7






























                                       F-2
<PAGE>


                          T & G2 INC., AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEET
                                 MARCH 31, 2004

                                     ASSETS
                                     ------



Current Assets:
  Cash and cash equivalents                                     $        61,710
  Accounts receivable, net                                              109,567
  Investment                                                             25,575
  Prepaid expenses and other current assets                               4,398
                                                                ----------------

      Total Current Assets                                              201,250
                                                                ----------------

Fixed assets, net of depreciation                                       167,881
  Deposits                                                                2,070
                                                                ----------------

TOTAL ASSETS                                                    $       371,201
                                                                ================


                 LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
                 ----------------------------------------------

LIABILITIES
Current Liabilities:
  Note payable - other                                          $        45,000
  Accounts payable and accrued expenses                                 261,083
  Due to related parties                                                156,308
                                                                ----------------

      Total Current Liabilities                                         462,391
                                                                ----------------

      Total Liabilities                                                 462,391
                                                                ----------------

STOCKHOLDERS' EQUITY (DEFICIT)
  Preferred Stock, Series A, $1.00 Par Value; 5,000,000 shares
    authorized, 0 shares issued and outstanding                               -
  Preferred Stock, Series B, $.001 Par Value; 5,000,000 shares
    authorized, 2,950,703 shares issued and outstanding                   2,951
  Common Stock, Class A, $.001  Par Value; 250,000,000
    shares authorized, 39,334,077 shares issued and outstanding          39,334
  Common Stock, Class B, $.001  5,000,000 shares authorized
    5,000,000 shares issued and outstanding                               5,000
  Subscriptions receivable                                           (2,018,815)
  Stock issued as collateral for note payable                                 -
  Warrants                                                               62,500
  Additional paid-in capital                                         19,399,392
  Treasury stock, at cost, 291,400 shares                               (37,338)
  Deficit                                                           (17,544,214)
                                                                ----------------

      Total Stockholders' Equity (Deficit)                              (91,190)
                                                                ----------------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)            $       371,201
                                                                ================






               The accompanying notes are an integral part of the
                  condensed consolidated financial statements.

                                       F-3
<PAGE>


<TABLE>
<CAPTION>
                          T & G2 INC., AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
               FOR THE THREE MONTHS ENDED MARCH 31, 2004 AND 2003


                                                       2004                2003
                                                 ----------------    ----------------

<S>                                              <C>                 <C>
OPERATING REVENUES
  Revenue                                        $       116,441     $         1,950

COST OF SALES                                             35,598                 781
                                                 ----------------    ----------------

GROSS PROFIT                                              80,843               1,169
                                                 ----------------    ----------------

OPERATING EXPENSES
  Professional fees and compensation expenses            356,465             101,178
  Advertising and marketing expenses                      27,183               4,930
  General and administrative expenses                     42,202              55,017
  Depreciation and amortization                           33,381              10,036
                                                 ----------------    ----------------
      Total Operating Expenses                           459,231             171,161
                                                 ----------------    ----------------

LOSS BEFORE OTHER (EXPENSE)                             (378,388)           (169,992)

OTHER (EXPENSE)
  Legal settlement                                       (17,500)                  -
  Interest expense, net                                   (3,217)            (10,385)
                                                 ----------------    ----------------
      Total Other (Expense)                              (20,717)            (10,385)
                                                 ----------------    ----------------

NET LOSS BEFORE PROVISION FOR INCOME TAXES              (399,105)           (180,377)

Provision for Income Taxes                                     -                   -
                                                 ----------------    ----------------

NET LOSS APPLICABLE TO COMMON SHARES             $      (399,105)    $      (180,377)
                                                 ================    ================

NET LOSS PER BASIC AND DILUTED SHARES            $      (0.01084)    $      (0.00229)
                                                 ================    ================

WEIGHTED AVERAGE NUMBER OF COMMON
  SHARES OUTSTANDING                                  36,831,055          78,647,344
                                                 ================    ================
</TABLE>









               The accompanying notes are an integral part of the
                  condensed consolidated financial statements.

                                       F-4
<PAGE>


<TABLE>
<CAPTION>
                          T & G2 INC., AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
               FOR THE THREE MONTHS ENDED MARCH 31, 2004 AND 2003




                                                                             2004                2003
                                                                       ----------------    ----------------

<S>                                                                    <C>                 <C>
CASH FLOW FROM OPERTING ACTIVIITES
  Net loss                                                             $      (399,105)    $      (180,377)
                                                                       ----------------    ----------------
  Adjustments to reconcile net loss to net cash
    used in operating activities

    Depreciation                                                                33,381              10,036
    Amortization of unearned compensation                                            -               1,310
    Common stock issued for consulting services                                331,650                   -
    Common stock issued for legal                                                3,300                   -

  Changes in assets and liabilities
    (Increase) in accounts receivable                                          (65,731)               (150)
    (Increase) decrease in prepaid expenses and other current assets            (2,176)                453
    Increase (decrease) in accounts payable and
      and accrued expenses                                                     (14,367)             91,899
                                                                       ----------------    ----------------
    Total adjustments                                                          286,057             103,548
                                                                       ----------------    ----------------

    Net cash (used in) operating activities                                   (113,048)            (76,829)
                                                                       ----------------    ----------------

CASH FLOWS FROM INVESTING ACTIVITIES
  Increase in amounts due to related parties                                     8,140              56,495
  Acquisition of fixed assets                                                   (1,136)             (7,610)
                                                                       ----------------    ----------------

    Net cash provided by investing activities                                    7,004              48,885
                                                                       ----------------    ----------------













               The accompanying notes are an integral part of the
                  condensed consolidated financial statements.

                                       F-5
<PAGE>


<CAPTION>
                          T & G2 INC., AND SUBSIDIARIES
           CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
               FOR THE THREE MONTHS ENDED MARCH 31, 2004 AND 2003




                                                                             2004                2003
                                                                       ----------------    ----------------

<S>                                                                    <C>                 <C>
CASH FLOWS FROM FINANCING ACTIVITES
  Proceeds from common stock issuances and stock subscriptions          $      106,000     $        43,900
  Net payments from issuance of notes payable - bank                                 -              (1,838)
  Repurchase of shares                                                               -             (35,800)
  Net proceeds from officers                                                         -              12,425
  Net proceeds from issuance of notes payable                                   45,000                   -
                                                                       ----------------    ----------------
     Net cash provided by financing activities                                 151,000              18,687
                                                                       ----------------    ----------------

NET INCREASE (DECREASE) IN
  CASH AND CASH EQUIVALENTS                                                     44,956              (9,257)

CASH AND CASH EQUIVALENTS -
  BEGINNING OF PERIOD                                                           16,754               9,676
                                                                       ----------------    ----------------

CASH AND CASH EQUIVALENTS - END OF PERIOD                              $        61,710     $           419
                                                                       ================    ================

SUPPLEMENTAL DISCLOSURE OF CASH FLOW
  INFORMATION:

CASH PAID DURING THE PERIOD FOR:
  Interest expense                                                     $        10,000     $        18,871
                                                                       ================    ================

SUPPLEMENTAL DISCLOSURE OF NONCASH
  ACTIVITIES:
    Issuance of common stock for:

      Consulting services                                              $       331,650     $             -
                                                                       ================    ================
      Legal                                                            $         3,300     $             -
                                                                       ================    ================
  Common stock issued for accrued expenses                             $         7,500     $             -
                                                                       ================    ================

  Preferred stock issued for investment                                $     2,000,000     $             -
                                                                       ================    ================
</TABLE>






               The accompanying notes are an integral part of the
                  condensed consolidated financial statements.

                                       F-6
<PAGE>


                          T & G2, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                             MARCH 31, 2004 AND 2003


NOTE 1 -  ORGANIZATION AND BASIS OF PRESENTATION
          --------------------------------------

          The unaudited  condensed  consolidated  financial  statements included
          herein have been prepared,  without  audit,  pursuant to the rules and
          regulations  of the Securities and Exchange  Commission  ("SEC").  The
          condensed consolidated financial statements and notes are presented as
          permitted  on Form 10-QSB and do not contain  information  included in
          the  Company's  annual  consolidated  statements  and  notes.  Certain
          information and footnote  disclosures  normally  included in financial
          statements prepared in accordance with accounting principles generally
          accepted  in the  United  States of  America  have been  condensed  or
          omitted pursuant to such rules and  regulations,  although the Company
          believes  that the  disclosures  are adequate to make the  information
          presented  not  misleading.  It  is  suggested  that  these  condensed
          consolidated  financial  statements  be read in  conjunction  with the
          December 31, 2003 audited  financial  statements and the  accompanying
          notes thereto.  While management  believes the procedures  followed in
          preparing  these  condensed   consolidated  financial  statements  are
          reasonable, the accuracy of the amounts are in some respects dependent
          upon  the  facts  that  will  exist,   and  procedures  that  will  be
          accomplished by the Company later in the year.

          These condensed  consolidated  unaudited financial  statements reflect
          all adjustments,  including normal recurring adjustments which, in the
          opinion  of   management,   are   necessary  to  present   fairly  the
          consolidated operations and cash flows for the periods presented.

          On January 12, 2002,  International  Mercantile  Corporation  acquired
          Solutions  Technology,  Inc.  ("STI"),  formerly known as Clickese.com
          ("Clickese")  for 20,511,365  shares of the Class A common stock,  and
          the former owners of STI acquired the 1,142,858  shares of the Class B
          common stock for $1. Upon this acquisition,  STI became a wholly owned
          subsidiary  of  International  Mercantile  Corporation.  STI  designs,
          develops  and  manufactures   biometrical  time  clocks  for  tracking
          employees' time and attendance.

          On February 14, 2002, International Mercantile Corporation changed its
          name to T & G2 (the "Company").  In addition,  the Company changed its
          domicile to Nevada,  which brought about a reverse 8 to 1 stock split,
          and a change in the par value of the stock to $0.001.

          In  addition  to STI  being a wholly  owned  subsidiary,  the  Company
          acquired Zingo Sales Ltd. ("Zingo") in March 2002 in a 2,500,000 share
          Class A  common  stock  acquisition.  Zingo's  mission  is to  design,
          develop,  manufacture and market easy to use complete  solutions using
          the latest  available  technologies.  Their  first  product is a fixed
          based bingo unit, for which sales had been generated late in 2002. The
          software  developed  for this  product is just as advanced if not more
          advanced than any product in the market at this time.




                                       F-7
<PAGE>


                          T & G2, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (CONTINUED)
                             MARCH 31, 2004 AND 2003


NOTE 1 -  ORGANIZATION AND BASIS OF PRESENTATION (CONTINUED)
          --------------------------------------

          In November 2002, the Company issued a board resolution authorizing an
          increase  to the  authorized  capital  to  100,000,000  Class A common
          shares and the Class B common shares to remain at the 2,000,000  share
          level.  In February 2003, the Company issued another board  resolution
          authorizing a further increase in its authorized  capital.  Under this
          resolution,  the Company increased its Class A common shares and Class
          B common shares to 250,000,000 shares and 5,000,000 shares authorized,
          respectively.  With this change, the Company issued a board resolution
          to  cancel  the  1,142,858  Class B common  shares,  and  issue to its
          officers 2,500,000 Class B common shares each (5,000,000 total) at par
          value.

          On April 25, 2001, Secure Time, Inc. merged into Clickese.com at which
          time the resulting  company  changed its name to STI. The  transaction
          was valued at $1 per share for 10,500,000 shares.

          International  Mercantile  Corporation was originally  incorporated in
          the State of  Missouri,  on March 10,  1971.  Their  business  purpose
          included  among other things,  maintaining  an Internet based personal
          computer   manufacturing   business  selling   build-to-order  systems
          throughout  the  United  States  to value  added  retailers  and other
          marketers of micro-computer systems. The Company has terminated all of
          these business activities.

NOTE 2 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
          ------------------------------------------

          Principles of Consolidation
          ---------------------------

          The condensed  consolidated  financial statements include the accounts
          of  the  Company  and  all  of  its  wholly  owned  subsidiaries.  All
          significant   intercompany   accounts  and   transactions   have  been
          eliminated in consolidation.

          Use of Estimates
          ----------------

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






                                       F-8
<PAGE>


                          T & G2, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (CONTINUED)
                             MARCH 31, 2004 AND 2003


NOTE 2 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
          ------------------------------------------

          Revenue and Cost Recognition
          ----------------------------

          Commencing  in 2002,  the Company  started  generating  revenues.  The
          Company  currently  records its revenue on the accrual basis,  whereby
          revenue is recognized upon the sales orders being placed.

          Cost is recorded on the accrual  basis,  when the purchase  orders are
          placed, and operating costs are incurred rather than paid for.

          Cash and Cash Equivalents
          -------------------------

          The Company  considers  all highly liquid debt  instruments  and other
          short-term  investments  with an initial  maturity of three  months or
          less to be cash equivalents.

          The Company  maintains  cash and cash  equivalent  balances at several
          financial  institutions  that  are  insured  by  the  Federal  Deposit
          Insurance Corporation up to $100,000.

          Fixed Assets
          ------------

          Fixed assets are stated at cost.  Depreciation  is computed  primarily
          using the  straight-line  method over the estimated useful life of the
          assets.

          Furniture and fixtures                             7   Years
          Office equipment                                3 to 5 Years
          Equipment - Zingo Sales                           1.5  Years
          Time clock equipment                              1.5  Years
          Time clock software                               3    Years

          Income Taxes
          ------------

          The income tax  benefit is  computed  on the pretax  loss based on the
          current tax law.  Deferred  income  taxes are  recognized  for the tax
          consequences  in future years of differences  between the tax basis of
          assets and liabilities and their financial  reporting  amounts at each
          year-end based on enacted tax laws and statutory tax rates.

          Advertising
          -----------

          Costs  of   advertising   and  marketing  are  expensed  as  incurred.
          Advertising  and  marketing  costs  were $ 27,183  and $ 4,930 for the
          three months ended March 31, 2004 and 2003, respectively.




                                       F-9
<PAGE>


                          T & G2, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (CONTINUED)
                             MARCH 31, 2004 AND 2003


NOTE 2 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
          ------------------------------------------

          Earnings (Loss) Per Share of Common Stock
          -----------------------------------------

          Historical  net income  (loss) per common share is computed  using the
          weighted average number of common shares outstanding. Diluted earnings
          per  share  (EPS)  includes  additional  dilution  from  common  stock
          equivalents,  such as stock issuable pursuant to the exercise of stock
          options and warrants. Common stock equivalents are not included in the
          computation of diluted  earnings per share when the Company  reports a
          loss because to do so would be antidilutive for the periods presented.

          The following is a  reconciliation  of the  computation  for basic and
          diluted EPS:

                                                        March 31,     March 31,
                                                          2004          2003
                                                       -----------   -----------

          Net Loss                                     ($ 399,105)   ($ 180,377)
                                                       -----------   -----------

          Weighted-average common shares
            outstanding (Basic)                        36,831,055    78,647,344

          Weighted-average common stock equivalents:
                Stock options                                   -             -
                Warrants                                        -             -
                                                                -             -

          Weighted-average common shares
              outstanding (Diluted)                    36,831,055    78,647,344
                                                       ===========   ===========

          Options and warrants  outstanding  to purchase stock were not included
          in the  computation of diluted EPS because  inclusion  would have been
          antidilutive.

          Software Development Costs
          --------------------------

          Internal use software costs are recorded in accordance  with Statement
          of  Position  (SOP) No.  98-1,  "Accounting  for the Costs of Computer
          Software  Developed or Obtained for Internal  Use".  Qualifying  costs
          incurred  during the  application  development  stage,  which  consist
          primarily of outside  services are  capitalized and amortized over the
          estimated  useful life of the asset.  All other costs are  expensed as
          incurred.  The  Company  has  determined  that all costs for the three
          months ended March 31, 2004 and 2003, do not relate to the application
          development stage and therefore have expensed these costs as they were
          incurred.



                                      F-10
<PAGE>


                          T & G2, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (CONTINUED)
                             MARCH 31, 2004 AND 2003


NOTE 2 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
          ------------------------------------------

          Fair Value of Financial Instruments
          -----------------------------------

          The carrying  amount  reported in the condensed  consolidated  balance
          sheet for cash and cash  equivalents,  accounts  receivable,  accounts
          payable,  accrued  expenses and notes payable  approximate  fair value
          because of the  immediate or  short-term  maturity of these  financial
          instruments.

          Stock-Based Compensation
          ------------------------

          The Company has elected to follow Accounting  Principles Board Opinion
          No. 25,  "Accounting  for Stock Issued to Employees" (APB No. 25), and
          related  interpretations,  in  accounting  for  their  employee  stock
          options rather than the alternative fair value  accounting  allowed by
          SFAS No.  123,  "Accounting  for  Stock-Based  Compensation",  and has
          adopted  the  enhanced   disclosure   provisions   of  SFAS  No.  148,
          "Accounting   for  Stock   Based   Compensation   -   Transition   and
          Disclosures",  an amendment of SFAS No. 123. APB No. 25 provides  that
          the  compensation  expense  relative to the Company's  employee  stock
          options is measured based on the intrinsic  value of the stock option.
          SFAS No. 123 requires  companies that continue to follow APB No. 25 to
          provide a  pro-forma  disclosure  of the impact of  applying  the fair
          value method of SFAS No. 123.

          Reclassifications
          -----------------

          Certain  amounts for the three  months  ended March 31, 2003 have been
          reclassified  to conform  to the  presentation  of the March 31,  2004
          amounts.  The  reclassifications  have no effect on net income for the
          three months ended March 31, 2003.

          Recent Accounting Pronouncements
          --------------------------------

          In September  2001, the Financial  Accounting  Standards  Board issued
          Statements  of  Financial   Accounting  Standards  No.  141,  Business
          Combinations,  and No.  142,  Goodwill  and Other  Intangible  Assets,
          effective for fiscal years  beginning  after December 15, 2001.  Under
          the new rules,  the  pooling of  interests  method of  accounting  for
          business   combinations   are  no  longer  allowed  and  goodwill  and
          intangible  assets deemed to have  indefinite  lives will no longer be
          amortized but will be subject to annual impairment tests in accordance
          with the  Statements.  Other  intangible  assets  will  continue to be
          amortized  over their  useful  lives.  The Company  adopted  these new
          standards effective January 1, 2002.






                                      F-11
<PAGE>


                          T & G2, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (CONTINUED)
                             MARCH 31, 2004 AND 2003


NOTE 2 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
          ------------------------------------------

          Recent Accounting Pronouncements (Continued)
          --------------------------------

          On October 3, 2001, the FASB issued Statement of Financial  Accounting
          Standards  No.  144,  "Accounting  for the  Impairment  or Disposal of
          Long-Lived  Assets"  ("SFAS  144"),  that is  applicable  to financial
          statements  issued for fiscal years beginning after December 15, 2001.
          The  FASB's  new  rules  on  asset  impairment   supersede  SFAS  121,
          "Accounting for the Impairment of Long-Lived Assets and for Long-Lived
          Assets to Be Disposed Of," and portions of Accounting Principles Board
          Opinion 30,  "Reporting  the  Results of  Operations."  This  Standard
          provides  a  single  accounting  model  for  long-lived  assets  to be
          disposed of and significantly  changes the criteria that would have to
          be met to  classify  an  asset  as  held-for-sale.  Classification  as
          held-for-sale  is an important  distinction  since such assets are not
          depreciated  and are  stated at the lower of fair  value and  carrying
          amount.  This Standard also requires  expected future operating losses
          from  discontinued  operations  to be  displayed  in the period (s) in
          which the losses are incurred,  rather than as of the measurement date
          as presently required.

          In April  2002,  the FASB  issued  SFAS No.  145,  Rescission  of FASB
          Statements  No. 4, 44 and 64,  Amendment of FASB Statement No. 13, and
          Technical  Corrections.  This statement rescinds SFAS No. 4, Reporting
          Gains and Losses from Extinguishment of Debt, and an amendment of that
          statement,  SFAS No. 44,  Accounting  for  Intangible  Assets of Motor
          Carriers,  and SFAS No.  64,  Extinguishments  of Debt Made to Satisfy
          Sinking-Fund   Requirements.   This  statement  amends  SFAS  No.  13,
          Accounting  for  Leases,  to  eliminate  inconsistencies  between  the
          required accounting for sales-leaseback  transactions and the required
          accounting for certain lease  modifications that have economic effects
          that are similar to sales-leaseback transactions.

          Also,   this   statement    amends   other   existing    authoritative
          pronouncements   to  make  various  technical   corrections,   clarify
          meanings,  or describe their  applicability  under changed conditions.
          Provisions  of SFAS No. 145 related to the  rescissions  of SFAS No. 4
          were  effective  for the Company on  November  1, 2002 and  provisions
          affecting SFAS No. 13 were effective for transactions  occurring after
          May 15, 2002.  The adoption of SFAS No. 145 did not have a significant
          impact on the Company's results of operations or financial position.








                                      F-12
<PAGE>


                          T & G2, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (CONTINUED)
                             MARCH 31, 2004 AND 2003


NOTE 2 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
          ------------------------------------------

          Recent Accounting Pronouncements (Continued)
          --------------------------------

          In June 2003,  the FASB  issued  SFAS No.  146,  Accounting  for Costs
          Associated  with Exit or Disposal  Activities.  This statement  covers
          restructuring  type  activities  beginning with plans  initiated after
          December  31,  2002.  Activities  covered  by this  standard  that are
          entered  into  after that date will be  recorded  in  accordance  with
          provisions  of SFAS No. 146. The adoption of SFAS No. 146 did not have
          a  significant  impact  on the  Company's  results  of  operations  or
          financial position.

          In December 2002, the FASB issued  Statement No. 148,  "Accounting for
          Stock-Based  Compensation-Transition  and Disclosure,  an amendment of
          FASB Statement No.  123"("SFAS  148").  SFAS 148 amends FASB Statement
          No.  123,  "Accounting  for  Stock-Based   Compensation,"  to  provide
          alternative  methods  of  transition  for an entity  that  voluntarily
          changes to the fair value based method of accounting  for  stock-based
          employee  compensation.  It also amends the  disclosure  provisions of
          that Statement to require  prominent  disclosure  about the effects on
          reported net income of an entity's  accounting  policy  decisions with
          respect to stock-based employee compensation.  Finally, this Statement
          amends  Accounting  Principles  Board ("APB") Opinion No. 28, "Interim
          Financial  Reporting",  to require  disclosure  about those effects in
          interim  financial  information.  SFAS 148 is effective  for financial
          statements  for fiscal  years ending  after  December  15,  2002.  The
          Company will continue to account for stock-based employee compensation
          using the  intrinsic  value method of APB Opinion No. 25,  "Accounting
          for  Stock  Issued  to  Employees,"   but  has  adopted  the  enhanced
          disclosure requirements of SFAS 148.

          In April 2003, the FASB issued SFAS  Statement No. 149,  "Amendment of
          Statement 133 on Derivative Instruments and Hedging Activities", which
          amends and clarifies financial accounting and reporting for derivative
          instruments,  including  certain  derivative  instruments  embedded in
          other  contracts  (collectively  referred to as  derivatives)  and for
          hedging  activities  under FASB  Statement  No.  133,  Accounting  for
          Derivative  Instruments  and Hedging  Activities.  This  Statement  is
          effective for contracts  entered into or modified after June 30, 2003,
          except for certain  hedging  relationships  designated  after June 30,
          2003.   Most   provisions   of  this   Statement   should  be  applied
          prospectively.   The  adoption  of  this  statement  did  not  have  a
          significant impact on the Company's results of operations or financial
          position.







                                      F-13
<PAGE>


                          T & G2, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (CONTINUED)
                             MARCH 31, 2004 AND 2003


NOTE 2 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
          ------------------------------------------

          Recent Accounting Pronouncements (Continued)
          --------------------------------

          In May 2003, the FASB issued SFAS Statement No. 150,  "Accounting  for
          Certain Financial Instruments with Characteristics of both Liabilities
          and Equity".  This Statement  establishes  standards for how an issuer
          classifies   and   measures   certain   financial   instruments   with
          characteristics  of both  liabilities and equity.  It requires that an
          issuer  classify a financial  instrument that is within its scope as a
          liability  (or an  asset in some  circumstances).  This  statement  is
          effective for financial instruments entered into or modified after May
          31, 2003,  and  otherwise  is effective at the  beginning of the first
          interim period  beginning after June 15, 2003,  except for mandatorily
          redeemable financial instruments of nonpublic entities, if applicable.
          It is to be implemented by reporting the cumulative effect of a change
          in an accounting  principle for financial  instruments  created before
          the issuance date of the Statement and still existing at the beginning
          of the interim period of adoption.  The adoption of this statement did
          not have a significant  impact on the Company's  results of operations
          or financial position.

          In November  2002, the FASB issued  Interpretation  No. 45 ("FIN 45"),
          Guarantor's  Accounting and Disclosure  Requirements  for  Guarantees,
          Including  Indirect  Guarantees  of  Indebtedness  of  Others.  FIN 45
          requires a company, at the time it issues a guarantee, to recognize an
          initial liability for the fair value of obligations  assumed under the
          guarantees and elaborates on existing disclosure  requirements related
          to  guarantees  and  warranties.   The  recognition  requirements  are
          effective for  guarantees  issued or modified  after December 31, 2002
          for  initial  recognition  and  initial  measurement  provisions.  The
          adoption of FIN 45 did not have a significant  impact on the Company's
          results of operations or financial position.

          In January  2003,  the FASB  issued FASB  Interpretation  No. 46 ("FIN
          46"),  Consolidation of Variable Interest Entities,  an Interpretation
          of ARB No. 51. FIN 46 requires certain variable  interest  entities to
          be consolidated by the primary beneficiary of the entity if the equity
          investors  in  the  entity  do  not  have  the  characteristics  of  a
          controlling  financial  interest or do not have  sufficient  equity at
          risk for the  entity to  finance  its  activities  without  additional
          subordinated financial support from other parties. FIN 46 is effective
          for all new  variable  interest  entities  created or  acquired  after
          January 31, 2003. For variable  interest  entities created or acquired
          prior to February 1, 2003,  the  provisions  of FIN 46 must be applied
          for the first interim or annual period  beginning after June 15, 2003.
          The  adoption  of FIN 46 did  not  have a  significant  impact  on the
          Company' results of operations or financial position.






                                      F-14
<PAGE>


                          T & G2, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (CONTINUED)
                             MARCH 31, 2004 AND 2003


NOTE 3 -  ACCOUNTS RECEIVABLE
          -------------------

          The Company extends  unsecured credit to its customers in the ordinary
          course  of  business  but  mitigates  the  associated  credit  risk by
          performing credit checks and actively  pursuing past due accounts.  An
          allowance for doubtful  accounts has not been established at March 31,
          2004, since Management is of the opinion that all accounts  receivable
          are fully collectible.

NOTE 4 -  FIXED ASSETS
          ------------

          Fixed assets consist of the following at March 31, 2004:

          Office equipment                             $    11,516
          Furniture and fixtures                             2,646
          Equipment - Zingo Sales                          258,447
          Time clock equipment                              38,730
          Time clock software                               54,144
                                                       ------------
                                                           365,483
                                                          (197,602)
                                                       ------------
                                Total                  $   167,881
                                                       ============

          Depreciation  expense was  $33,381  and  $10,036 for the three  months
          ended  March 31, 2004 and 2003.  A portion of these fixed  assets were
          acquired  when the Company was  acquired by  International  Mercantile
          Corporation.

NOTE 5 -  NOTES PAYABLE - BANK
          --------------------

          On April 3, 2001, the Company entered into a line of credit  agreement
          with a bank. The note,  which is due on demand bears interest at prime
          plus 2.25% and provides for maximum borrowings up to $63,100. The line
          of credit is guaranteed  by a majority  shareholder.  The  outstanding
          balance at March 31,  2004 was $0.  The line of credit was STI's,  and
          was  assigned  over to the  Company  upon  the  acquisition.  Interest
          expense  charged to  operations  for the three  months ended March 31,
          2004 and 2003 was $0 and $531, respectively.

NOTE 6 -  NOTES PAYABLE - OTHER
          ---------------------

          The  Company  pursuant  to a note  agreement  dated May 28,  2002 with
          Protech Trading Inc. had a note payable in the amount of $68,800,  due
          May 30,  2003.  Interest  on this note was payable  quarterly,  at one
          percent per quarter,  four percent annually.  In addition to receiving
          the funds from  Protech,  the Company  issued them  200,000  shares of
          common stock for  consulting in  accordance  with the  agreement.  The
          agreement  between  the  parties  was  cancelled,  and  the  note  was
          forgiven, The Company had reclassified this note to additional paid in
          capital along with all accrued interest on the note as of December 31,
          2003.




                                      F-15
<PAGE>


                          T & G2, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (CONTINUED)
                             MARCH 31, 2004 AND 2003


NOTE 6 -  NOTES PAYABLE - OTHER (CONTINUED)
          ---------------------

          In  March  2004,  the  Company   entered  into  an  agreement  with  a
          non-related  entity for $45,000.  The Company  converted the note into
          2,000,000 shares of common stock in April 2004.

NOTE 7 -  RELATED PARTY TRANSACTIONS
          --------------------------

          Amounts due to/from  related  parties at March 31, 2004 were  $156,308
          and consists of the following:

          A note payable to an officer totaling $27,871 at 10% interest, payable
          monthly,   due  on  demand.   At  March  31,  2004,  the  Company  has
          approximately $8,244 in accrued interest to this officer.

          Note receivable from a company through common  ownership in the amount
          of $23,732 at March 31, 2004.

          Note payables to a company  through common  ownership in the amount of
          $142,969 at March 31, 2004, at 10% interest,  payable monthly,  due on
          demand.  At March 31, 2004, the Company has  approximately  $10,927 in
          accrued interest to this company.

          The Company has $9,200  outstanding to another entity related  through
          common ownership at March 31, 2004. At March 31, 2004, the Company has
          approximately $440 in accrued interest to this company.

          Prior to the acquisition by International Mercantile Corporation,  STI
          relied upon funds from related parties to fund operations.

NOTE 8 -  ACQUISITIONS
          ------------

          On January  12,  2002,  the  Company  acquired  STI as a wholly  owned
          subsidiary for 20,511,365  shares of common stock.  At the time of the
          acquisition,  STI's book  value of their net assets was  approximately
          $0.  The  acquisition  of the  20,511,365  shares  were  valued at the
          Company's  fair value at the time of the issuance  which  approximated
          $.15 per share,  $3,177,556.  In accordance with FASB 142, the Company
          impaired the goodwill for that amount.









                                      F-16
<PAGE>


                          T & G2, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (CONTINUED)
                             MARCH 31, 2004 AND 2003


NOTE 8 -  ACQUISITIONS (CONTINUED)
          ------------

          In March, 2002, Zingo was acquired as a wholly owned subsidiary by the
          Company for  2,500,000  shares of common stock.  Zingo Sales,  Ltd., a
          relatively  new company had very  little  activity  and also had a net
          book  value of  approximately  $0. The shares  issued  were  valued at
          $1.95,  the fair  value of the  stock  at the  time of  issuance.  The
          $4,875,000,  was recorded as goodwill and subsequently impaired to $0.
          The  impairment  is  included  in  the   consolidated   statements  of
          operations for the year ended December 31, 2002.

          On or about March 29, 2004,  the Company  entered into an  acquisition
          agreement   with   Holtermann   &  Team,   GmbH,   a  German   Company
          ("Holtermann"),  to  acquire,  effective  April 1,  2004,  100% of the
          assets and equity  interests of Holtermann in exchange for  10,000,000
          restricted  shares of the Company's  Class A Common  Stock.  Under the
          terms of the  Acquisition  Agreement,  the Company is the successor in
          interest to a certain  Loan  Agreement  under which  Holtermann  is to
          receive  $950,000 by the end of 2004.  The shares of common stock were
          issued in April 2004.

NOTE 9 -  STOCKHOLDERS' EQUITY (DEFICIT)
          --------------------

          Preferred Stock
          ---------------

          At March 31,  2004,  there are  5,000,000  shares of Class A Preferred
          Stock, par value $1.00 authorized and 0 shares issued and outstanding.
          In April,  2003, the Company  passed a board  resolution to re-instate
          the Series A Preferred Stock changing its par value to $.001.

          Additionally,  the  Company  passed a board  resolution  to  authorize
          5,000,000  shares of Class B Preferred  Stock,  par value $.001. As of
          March  31,  2004,   the  Company  has  2,950,713   shares  issued  and
          outstanding. 282,713 of these shares were issued to Mercatus Partners,
          Ltd. in connection with an amended loan  agreement.  These shares were
          issued when the Company  cancelled  the  66,666,667  shares of Class A
          Common  Stock that were  issued as  collateral  to the  original  loan
          agreement.  The amended loan  agreement was  terminated by the Company
          and all 282,713  shares have been  cancelled of record.  As of May 17,
          2004  certificates  representing  117,885 have been surrendered to the
          Company. An additional 668,000 shares were issued to a Bermuda company
          as collateral for a promissory  note.  These shares were valued at the
          par value and  recorded  against  additional  paid in  capital  as the
          preferred shares have no readily determinable market value.  Effective
          April 9, 2004,  the  Company  terminated  this  agreement  due to this
          company's failure to make loan advances as set forth in the agreement.
          All shares have been surrendered to the Company.



                                      F-17
<PAGE>


                          T & G2, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (CONTINUED)
                             MARCH 31, 2004 AND 2003


NOTE 9 -  STOCKHOLDERS' EQUITY (DEFICIT) (CONTINUED)
          ------------------------------

          Preferred Stock (Continued)
          ---------------------------

          The  remaining  2,000,000  shares of the Class B  Preferred  Stock was
          issued  in  accordance  with a  March  24,  2004  Investment  Exchange
          Agreement  (the  "Agreement")  with Cross Capital Fund,  LLC.  ("Cross
          Capital").  The Company  entered into the Agreement  that provides for
          Cross  Capital to make an equity  investment  in the  Company  and the
          Company  will  receive  from  Cross  Capital  an  Investor  Membership
          Interest in an  aggregate  amount  equal to  $2,000,000  over the next
          twelve months (March 2005). The first equity investment is expected to
          take place in May 2004.  The 2,000,000  shares were issued in exchange
          for the  Investor  Membership  Interest.  The Company has recorded the
          $2,000,000 as a subscription  receivable on the condensed consolidated
          balance sheet at March 31, 2004.  The Preferred  shares convert to the
          Company's Class A Common Shares as set forth in the agreement.

          Common Stock
          ------------

          As of March 31, 2004, there were 250,000,000  shares  authorized,  and
          39,334,077 issued and 39,042,677  outstanding  shares of the Company's
          common  stock A with a par  value of  $.001.  In  February  2003,  the
          Company upon an approved  board  resolution  increased the  authorized
          limit of the Class A common shares to 250,000,000.

          As of March 31,  2004  there were  5,000,000  shares  authorized,  and
          5,000,000  shares issued and outstanding of the Company's common stock
          B with a par value of  $.001,  respectively.  In  February  2003,  the
          Company upon an approved  board  resolution  increased the  authorized
          limit of the Class B common  shares to  5,000,000.  Subsequent to this
          board  resolution,  the Company  cancelled the  outstanding  1,142,858
          shares and issued the entire 5,000,000 shares to two of its officers.

          The following shares of common stock Class A were issued for the three
          months ended March 31, 2004 and for the year ended December 31, 2003:

          On January 14,  2004,  the Company  entered  into a Loan and  Security
          Agreement  and a  Multiple  Advance  Promissory  Note  with a  Bermuda
          company.  This  agreement  establishes  a multiple  advance  loan of a
          maximum of $2,600,000. As collateral for this note, the Company issued
          668,000  shares of its Series B  Preferred  Stock.  Additionally,  the
          Company issued to the Bermuda company a warrant for the purchase of up
          to  6,000,000  shares of the  Company's  common stock A at an exercise
          price of $.15 per share.  The warrants carry no  registration  rights.
          Both the Series B Preferred  Stock and the warrants  have be cancelled
          due to the Bermuda company's failure to fund the loan.



                                      F-18
<PAGE>


                          T & G2, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (CONTINUED)
                             MARCH 31, 2004 AND 2003


NOTE 9 -  STOCKHOLDERS' EQUITY (DEFICIT) (CONTINUED)
          ------------------------------

          Common Stock (Continued)
          ------------------------

          The Company  issued  3,585,000  shares to  consultants at various fair
          market value prices for a total expense of $331,650  (average value of
          $.09 per share) during the three months ended March 31, 2004.

          The Company  issued 30,000 shares for legal  services for $3,00 (value
          of $.11 per share) during the three months ended March 31, 2004.

          The Company  issued  50,000 shares during the three months ended March
          31, 2004 in conversion of accrued  expenses valued at $7.500 ($.15 per
          share).

          The Company received $106,000 of subscriptions receivable in the three
          months ended March 31, 2004 that related to stock issuances in 2003.

          There  were  1,600,000  shares of stock  issued in the  quarter  ended
          December 31, 2003 for consulting  services (including legal fees) at a
          fair value of $248,000 ($.15 per share).

          There  were  2,100,000  shares of stock  issued in the  quarter  ended
          December 31, 2003 for cash for $203,510 ($.09 per share).  The Company
          recorded an additional $139,120 on these shares to record the discount
          provided  and bring the fair value of the shares  issued to an average
          of $.16 per share, which was the fair value of the shares on the dates
          issued.  In addition,  the Company has a  subscription  receivable  of
          $122,560  relating to these  shares.  The Company also, in the quarter
          ended December 31, 2003 received  $65,000 relating to shares issued in
          the quarter ended September 30, 2003.

          There were  525,000  shares of stock  cancelled  in the quarter  ended
          December  31, 2003 for  accrued  compensation  to the  officers of the
          Company at a fair value of $105,000 ($.20 per share).

          There  were  1,210,000  shares of stock  issued in the  quarter  ended
          September 30, 2003 for consulting services (including legal fees) at a
          fair value of $170,400 ($.14 per share).

          There  were  5,625,000  shares of stock  issued in the  quarter  ended
          September 30, 2003 for cash for $626,693 ($.11 per share). The Company
          recorded an additional $228,307 on these shares to record the discount
          provided  and bring the fair value of the shares  issued to an average
          of $.15 per share, which was the fair value of the shares on the dates
          issued.  In addition,  the Company has a  subscription  receivable  of
          $65,000  relating to these  shares.  The Company  also, in the quarter
          ended September 30, 2003 received  $172,000  relating to shares issued
          in the quarter ended June 30, 2003.


                                      F-19
<PAGE>


                          T & G2, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (CONTINUED)
                             MARCH 31, 2004 AND 2003


NOTE 9 -  STOCKHOLDERS' EQUITY (DEFICIT) (CONTINUED)
          ------------------------------

          Common Stock (Continued)
          ------------------------

          There  were  985,000  shares  of stock  issued  in the  quarter  ended
          September  30, 2003 for accrued  compensation  to the  officers of the
          Company at a fair value of $165,000 ($.16 per share).

          There were 3,332,000  shares of stock issued in the quarter ended June
          30,  2003 for  consulting  services  (including  legal fees) at a fair
          value of $261,960 ($.07 per share).

          There were 8,280,000  shares of stock issued in the quarter ended June
          30, 2003 for cash for $651,700 ($.079 per share). The Company recorded
          an additional $112,183 on these shares to record the discount provided
          and bring the fair  value of the  shares  issued to an average of $.09
          per share, which was the fair value of the shares on the dates issued.
          In addition,  the Company has a  subscription  receivable  of $172,000
          relating to these shares.

          There were 800,000  shares of stock  issued in the quarter  ended June
          30, 2003 for accrued  compensation to the officers of the Company at a
          fair value of $45,200 ($.0565 per share).

          There were 32,100,000 shares of stock issued in the quarter ended June
          30, 2003 as collateral  for a note payable  agreement that the Company
          had  anticipated  entering  into.  These  shares  had a fair  value of
          $2,247,000  ($.07 per share).  The note payable was entered into,  and
          due to a default on or about  May/June  2003 by the other party to the
          transaction  in July 2003,  the shares were  returned and cancelled by
          the Company.

          There were  66,666,667  shares of stock cancelled in the quarter ended
          June 30,  2003  that  were  issued as  collateral  for a note  payable
          agreement  that the Company had entered into with  Mercatus  Partners,
          Ltd. These shares had a fair value of $8,666,667 ($.13 per share), and
          were being held in escrow. In April 2003, the Company amended the loan
          agreement  and  these  shares  were  cancelled  as  a  result  of  the
          amendment, and the Company issued 282,703 shares of Series B Preferred
          Stock at par value of $.001.  As set forth  above,  those  shares have
          similarly been cancelled.

          The  Company,  in the quarter  ended March 31, 2003  received  $43,900
          relating to shares issued in 2002.








                                      F-20
<PAGE>


                          T & G2, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (CONTINUED)
                             MARCH 31, 2004 AND 2003


NOTE 9 -  STOCKHOLDERS' EQUITY (DEFICIT) (CONTINUED)
          ------------------------------

          Treasury Stock
          --------------

          In January 2003, the Company  instituted a buy back program of its own
          stock.  For the three months ended March 31, 2004,  the Company bought
          back no  additional  shares of its  common  stock and placed it in its
          treasury.  For the year ended  December 31, 2003,  the Company  bought
          back 291,400 shares of its common stock and placed it in its treasury.
          The Company has  accounted for its treasury  stock  utilizing the cost
          method,  and such,  the $37,338 at March 31, 2004  represents the cost
          value of the treasury shares acquired by the Company.

NOTE 10 - GOING CONCERN
          -------------

          As  shown  in  the  accompanying   condensed   consolidated  financial
          statements,  the Company incurred substantial net losses for the three
          months ended March 31, 2004 and the years ended  December 31, 2003 and
          2002.  There  is no  guarantee  whether  the  Company  will be able to
          generate   enough  revenue  and/or  raise  capital  to  support  those
          operations.  This raises substantial doubt about the Company's ability
          to continue as a going concern.

          The Company has improved its operations in its Zingo  subsidiary,  and
          has been successful in the marketing of their products and have placed
          several  units  in the  western  United  States  since  June of  2003.
          Management  feels that Zingo will increase  their sales by 600% in the
          upcoming  year based on  current  billings  per month and  anticipated
          billings.  STI has also started  generating  revenue,  and  Management
          feels that they have  generated  some good leads to have more of their
          units placed in the first six months of 2004.

          The  Company in April 2004 has also  acquired  a German  Company  with
          assets of more than $1,500,000 US dollars.  The German Company will be
          instrumental  in building a European  presence  for the Company in the
          distribution of the Company's products.

          The  condensed  consolidated  financial  statements do not include any
          adjustments that might result from the outcome of these uncertainties.

NOTE 11 - COMMITMENTS
          -----------

          The  Company's  Zingo  products  have  received  clearance  in certain
          jurisdictions  in the western and  northwestern  regions of the United
          States as a bingo game.  With this  clearance,  the Company expects to
          bring the number of units operational to over 250 and additional units
          have been placed since March 31, 2004.




                                      F-21
<PAGE>


                          T & G2, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (CONTINUED)
                             MARCH 31, 2004 AND 2003


NOTE 11 - COMMITMENTS (CONTINUED)
          -----------

          In November  2002, the Company  installed its  Securetime  system in a
          restaurant at a major Las Vegas,  Nevada casino.  The Company has also
          received an order for the  Securetime  system  from a Native  American
          business  in  Oklahoma  and the  installation  was  completed  in late
          November.  Both of these installations signed contracts for continuing
          and  ongoing  services in March  2003.  In the first  quarter of 2004,
          Securetime  has installed a biometric ID system in a bingo facility in
          Wyoming.

NOTE 12 - LITIGATION
          ----------

          In an action commenced on or about March 28, 2002 in the Supreme Court
          of the State of New York, the plaintiff  seeks $40,000 in damages from
          the  Company  as well  as  other  defendants  listed  in this  action,
          allegedly sustained as a result of third party payments made on behalf
          of all  defendants,  including,  but not  limited to the  Company.  An
          answer denying all material  allegations was served upon the Plaintiff
          on May  1,  2002,  within  the  time  allotted  by  law to do so.  The
          Plaintiff as of March 25, 2004, has failed to respond to the Company's
          discovery  demands.  The  Company  will  seek an  Order  of the  Court
          dismissing  this  action  due to the  plaintiff's  failure  to comply.
          Management  is of the belief  that all  allegations  involved  in this
          action are without merit.  No liability is recorded for this action as
          of March 31, 2004.

          In an action commenced in or about March 2003 in the Superior Court of
          Union County New Jersey, the plaintiff seeks $35,000 for the Company's
          alleged breach of a Communications  Agreement. The Company believes it
          owes only  $15,000.  During a mediation  hearing  held on December 10,
          2003,  the Company  settled this matter for  $17,500.  The Company has
          made the  required  settlement  payment and the case was  dismissed in
          February 2004.

NOTE 13 - INVESTMENT
          ----------

          The Company's  subsidiary,  Zingo Sales,  Ltd.  formed a joint venture
          company  as a 50%  owner.  This  company  has a 20%  ownership  in the
          management of a Bingo Hall. These  consolidated  financial  statements
          have consolidated these operations, and reflects the investment in the
          management  of the Bingo  Hall on its  consolidated  balance  sheet in
          accordance with the cost method,  as its ownership  percentage is 20%,
          and  the  Company  does  not  exercise  significant  influence  on the
          operational or financial decision making of that company.








                                      F-22
<PAGE>


                          T & G2, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (CONTINUED)
                             MARCH 31, 2004 AND 2003


NOTE 14 - SUBSEQUENT EVENTS
          -----------------

          The Company  entered into various  agreements for the  installation of
          their  gaming  units.  Since March 31,  2004,  the Company has entered
          agreements for additional units.

          On or about March 29, 2004,  the Company  entered into an  acquisition
          agreement   with   Holtermann   &  Team,   GmbH,   a  German   Company
          ("Holtermann"),  to  acquire,  effective  April 1,  2004,  100% of the
          assets and equity  interests of Holtermann in exchange for  10,000,000
          restricted  shares of the Company's  Class A Common  Stock.  Under the
          terms of the  Acquisition  Agreement,  the Company is the successor in
          interest to a certain  Loan  Agreement  under which  Holtermann  is to
          receive  $950,000 by the end of 2004.  The shares of common stock were
          issued in April 2004.

          The Company in April 2004 issued  2,000,000  shares of common stock in
          conversion of a note payable for $45,000.

          Effective April 9, 2004, the Company cancelled 668,000 shares of Class
          B Preferred  Stock they  issued in  connection  with a Loan  Agreement
          executed in January 2004. The cancellation was the result of the other
          party's failure to make loan advances as set forth in the agreement.


























                                      F-23
<PAGE>






          Management's Discussion and Analysis of Financial Conditions
          ------------------------------------------------------------
                            and Results of Operations
                            -------------------------


Introduction
------------

The following discussion and analysis highlights the financial position of T &
G2 (squared), Inc. (the "Company" or "us") at March 31, 2004 and compared to the
first quarter ended March 31, 2003 and plan of operations for the three-month
period ended March 31, 2004 and 2003. This discussion and analysis contained in
our Quarterly Report on Form-10QSB for the Quarter ended March 31, 2004.
Financial information contained within this report is condensed and reviewed. It
is important to note that the Company had no operations in the year 2001 and in
early 2002 and had a primary goal of finding a new business(s). In the year of
2002 T & G2 (formerly known as International Mercantile Corporation) changed its
name to the current name the Company goes under (T & G2), effectuated a 1 for 8
reverse split and acquired two companies - Solutions Technology and Zingo Sales,
Ltd. Subsequent to the 1st quarter, the Company acquired a German Based entity,
Holtermann & Team GMBH, as a wholly-owned subsidiary. This entity will be the
vehicle for conducting all foreign business operations. The business activities
of the Company are now that of the three wholly owned subsidiaries. Comparisons
are provided below on a consolidated basis for the whole Company. In reviewing
the Company's numbers in this report, it must be remembered that it essentially
shows the first year of operations in the Company's two wholly owned
subsidiaries and nothing for the newly acquired GmbH.

Certain statements in this Form 10-QSB, including information set forth under
Item 2. Management's Discussion and Analysis of Financial Condition and Result
of Operations constitute `forward-looking statements' within the meaning of the
Private Securities Litigation Reform Act of 1995 (the "Act"). Such
forward-looking statements are identified by words such as "intends,"
"anticipates," "hopes," and "expects," among others, and include, without
limitation, statements regarding the Company's plan of business operations,
anticipated revenues, related expenditures, and the results of any business
transactions. Factors that could cause actual results to differ materially
include, among others, the following: acceptability of the Company's services in
the market place, general economic conditions, political and economic conditions
in the United States and abroad, and competition. Investors are cautioned not to
put undue reliance on forward-looking statements. Except as otherwise required
by applicable securities statutes or regulations, the Company disclaims any
intent to update publicly these forward-looking statements, whether as a result
of new information, future events or otherwise.

Plan of Operation
-----------------

The Company's management entered into a transaction for funding in the form of
an equity financing. This financing is to provide $2,000,000 US dollars over
approximately a 12-month period in equal installments. However, based on
numerous factors, the funding may be completed sooner or later or may be front
loaded. This funding transaction was entered into with Cross Capital Fund, LLC
of New York. Additionally, the acquisition of Holtermann & Team GmbH, which
occurred in April 2004brings with it a significant investment commitment of
$950,000 with more than $145,000 cash already being advanced. To the Company
with these transactions has drastically improved its liquidity position and is
in a more advantageous position to execute it's business plan and succeed.
However, until the Cross Capital Fund invests the up to $2,000,000 they plan to,
there can be no assurance that the Company will raise the appropriate funds
necessary to carry out its complete business plan. There were three other
financing arrangements that the Company entered into, in the past year, issuing
a total of 100,000,000 million shares of Class A Common and a Preferred Shares
convertible into Class A Common. All three of these transactions never closed
and the Company therefore has cancelled these shares. For the following
nine-month period from April, 2004 to December, 2004 it is anticipated that the
Company's primary funding for ongoing corporate expenses, such as legal and
accounting fees and filing fees, will be provided by the Funds already received
and funds to be received from the Cross Capital Fund Investment and the
Holtermann & Team GmbH acquisition and from operating activities.




                                        2
<PAGE>






The Company has made significant developments in the distribution of its
products - namely in Zingo Sales with the distribution and placement of the
Zingo Bingo Unit utilizing the Ultimate Bingo Game System. This is evidenced by
an examination of the Company's Statement of Operations contained in this and
other historical filings. For the first three months of 2003, the Company
generated less than $2,000 in revenue compared with more than $116,000 for the
comparative three months of 2004. In fact, the revenue of $116,441, in the 1st
quarter of 2004 alone, shows an increase of more than 76% in sales as compared
to the $65,969 in revenue generated for all of 2003. Assuming 50% of the
capital, in the financings mentioned above, is actually funded, the Company
looks to more than double the number of Bingo units (utilizing DoubleTime,
Hotball or Bullet) in operation in the North America by the end of 2004.
Additionally, Zingo Sales now expects to place bingo units just for the play of
the regular session bingo game. While this is a lower revenue generator, it will
bring solid fixed revenue to the company and will greatly enhance the overall
revenue and earnings for the overall Company. Also, in the second quarter, the
Company anticipates providing the necessary funds to implement a marketing and
distribution plan for the placement of Solutions Technology's time clocks - the
SecureTime System. Third, expansion into the European Union and other viable
markets will be explored. The likelihood of some sort of sales overseas in 2004
seems to be very likely. It now appears that Zingo Sales will be a profitable
entity going forward. In fact, in the first three months of 2004, Zingo
Generated a net profit of approximately $45,000. Managements goal is to bring
the other two wholly owned subsidiaries to profitability by the end of the
2004-year.

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

For the three-months ended March 31, 2004, the Company used ($113,048) in
operating activities compared to ($76,829) for the three-months ended March 31,
2003. The increase in cash used in operating activities of $36,219 is most
attributable to additional shares of stock being issued for services and the
decrease in accounts payable and accrued expenses. The Company has continued to
borrow certain amounts from related parties to finance the beginning production
costs for its time clocks and computerized bingo systems. The Company has made
significant progress with respect to future funding. Funding is expected
shortly, which will enable the Company to market, and produce its products. We
anticipate that going forward; we will streamline administrative, and
professional fees to conserve cash flow. Once the recognition of revenues
occurs, certain expenses will increase, but only in accordance with the increase
in revenues.

Going Concern. The accompanying condensed consolidated financial statements have
been prepared assuming the Company will continue as a going concern. The Company
has suffered recurring losses from operations and at March 31, 2004, had a
working capital deficit. The condensed consolidated financial statements do not
include any adjustments that might result from the outcome of this uncertainty.
However, the Company has realized installations for its bingo equipment and has
many pending orders. It now appears that the company has a realistic chance to
reach cash flow positive by the end of the second quarter (June 30, 2004) of
this year.




                                        3
<PAGE>

Controls and Procedures
-----------------------

Internal Control Policy
-----------------------

In April 2003, the Company implemented an Internal Control Policy allowing for
the confidential receipt and treatment of complaints in regards to the Company's
internal accounting controls and auditing matters. A director, officer or
employee may file a confidential and anonymous concern regarding questionable
accounting or auditing maters to an independent representative of the Company's
Audit Committee. As of December 31, 2003, an evaluation was performed under the
supervision and with the participation of the Company's management, including
the Chief Executive Officer and the Chief Financial Officer, of the
effectiveness of the design and operation of the Company's disclosure controls
and procedures. Based on that evaluation, the Company's management, including
the Chief Executive Officer and the Chief Financial Officer, concluded that the
Company's disclosure controls and procedures were effective as of December 31,
2003. There have been no significant changes in the Company's internal controls
or in other factors that could significantly affect internal controls subsequent
to December 31, 2003.

Code of Ethics
--------------

In September 2002, the Company implemented a Code of Ethics by which directors,
officers and employees commit and undertake to personal and corporate growth,
dedicate themselves to excellence, integrity and responsiveness to the
marketplace, and work together to enhance the value of the Company for the
shareholders, vendors, and customers.



































                                        4
<PAGE>






                           PART II. OTHER INFORMATION
                           --------------------------


Item 1.   Legal Proceedings
---------------------------

     The Company is not engaged in any legal proceedings except litigation in
the ordinary course of its business. In the opinion of management, the amount of
ultimate liability with respect to any such proceedings will not be material to
the Company's financial position or results of operations.


Item 2.   Changes in Securities
-------------------------------

     None.


Item 3.   Defaults Upon Senior Securities
-----------------------------------------

     None.


Item 4.   Submission of Matters to a Vote of Securities Holders
---------------------------------------------------------------

     No matters were submitted to a vote of the security holders of the Company
during its fiscal quarter ended March 31, 2004.


Item 5.   Other Information
---------------------------

     None.


Item 6.   Exhibits and Reports on Form 8-K
------------------------------------------

          (a)  Exhibits

               14.1           Code of Ethics

               31.1           Certification of the Principal Executive Officer
                              and Chief Financial Officer, pursuant to Section
                              302 of the Sarbanes-Oxley Act of 2002.

               32.1           Certification of Principal Executive Officer and
                              Chief Financial Officer, pursuant to Section 906
                              of the Sarbanes-Oxley Act of 2002.

          (b)  Reports on Form 8-K.

               On April 28, 2004, the Company filed a Curent Report on Form 8-K
               under Item 2 reporting an Acquisition Agreement with Holtermann &
               Team, GmbH, a German Company to acquire, effective April 1, 2004,
               100% of the assets and equity interests of Holtermann in exchange
               for 10,000,000 restricted shares of the Company's Class A Common
               Stock, and under Item 5 reporting on or about March 24, 2004, the
               Company entered into an Investment Exchange Agreement with Cross
               Capital Fund, LLC.

               On April 28, 2004, the Company filed a Curent Report on Form 8K/A
               under Item 5 reporting effective April 9, 2004, the Company
               terminated the Loan and Security Agreement and a Multiple Advance
               Promissory Note that it had entered into with Finanzinvest, Ltd.
               on January 14, 2004, due to the Lender's failure to make loan
               advances as set forth in the Loan Agreement.




                                        5
<PAGE>






                                   SIGNATURES
                                   ----------

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


T & G 2, Inc.


Date: May 18, 2004               By:  /s/ James Farinella
                                      -------------------------------------
                                      James Farinella
                                      Chairman, Chief Executive Officer and
                                      President








































                                        6