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

                                   FORM 10-KSB

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

                    FOR FISCAL YEAR ENDED FEBRUARY 28, 2003.

                                    000-30703
                             Commission File Number

                        COLLECTIBLE CONCEPTS GROUP, INC.
                 ----------------------------------------------
                 (Name of small business issuer in its charter)


          Delaware                                              95-4026880
---------------------------                                 ------------------
State or other jurisdiction                                    IRS Employer
      of incorporation                                      Identification No.


          1600 Lower State Road, Doylestown, PA 18901, (215) 491-1075
         -------------------------------------------------------------
         (Address and telephone number of principal executive offices)

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 $0.001

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 [ ] No [X]

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

The registrant's revenues from continuing operations for the year ended February
28, 2003 were $82,935.

As of June 30, 2004, the aggregate market value of the common stock held by
non-affiliates computed by reference to the average bid and asked prices of such
stock was $950,082.

As of June 30, 2004, the registrant had 478,972,190 shares of common stock, par
value $.001 per share, outstanding.
<PAGE>

                                     PART I

ITEM 1. DESCRIPTION OF BUSINESS.

                  BUSINESS DEVELOPMENT & HISTORICAL PERSPECTIVE

         Collectible Concepts Group, Inc. was originally formed on March 1, 1986
as "Amour Corporation". We changed our name to "Bard Sports Corp." in September
1988, and changed our name again on February 28, 1993 to "USA Sports Corp". We
most recently changed our name to "Collectible Concepts Group, Inc." on April
27, 1999. We are incorporated under the laws of the State of Delaware.

         Our roots are in the production and distribution of collectible items
principally related to various sports. Following what management perceived to be
a change in consumer trends from high end sports collectibles to more commodity
types of sports items such as trading cards, we modified our business direction
and refocused our efforts on the emerging consumer interest in entertainment
related collectibles. This redirection to the entertainment markets required a
significant development effort on our part, particularly in terms of the
procurement of new licenses and marketing privileges necessary to produce and
distribute collectibles in this new marketing area. Beginning in 1999 , we
proceeded to obtain licenses, from Marvel for its X-Men, Spiderman and Hulk
movies as well as well as licenses to produce products related to the Terminator
1, 2 and 3 movie series. Expanding on our plan to provide entertainment related
goods; we also purchased licenses from Marvel for its comic book characters and
additional licenses for the Three Stooges and Chicken Soup for the Soul
(terminated December 31, 2002). With our acceptance by the entertainment
community as a provider of high quality collectibles, we proceeded to secure
more licenses including Planet of the Apes, Farscape, Stan Lee Media, Vern
Troyer and Titan Motorcycle Company. Items covered by these licenses included
hanging wall scrolls produced in a silk-like fabric, collector pins, sculpted
items and items shown in the film such as dog tags, rings and replicas of jet
airplanes. While we were successful in presenting the Company to the
entertainment marketplace as a viable licensee, we made significant investments
in the cost of these licenses both in terms of the down payments and,
importantly, the guaranteed royalties stipulated under the license agreements.
Additional investment both in dollars and human resources was also required to
develop the authorized products. These expenditures taxed our financial
resources placing serious limitations on our ability to deliver products in a
timely fashion, a crucial requirement when consumer demand is driven by
scheduled events such as movie releases. This proved to be a major factor in the
decline in our revenues for the current fiscal year.

         Music Art: On June 5, 2000, we acquired Music Art Corporation in
consideration of 14,286 shares of our common stock. Through the transaction,
Music Art became a wholly owned subsidiary of ours. We acquired certain
databases and the inventory of Music Art's music and entertainment memorabilia.
The value of the inventory was $36,056 and computer equipment was $1,368, which
represented the majority of the physical assets acquired. The purchase price for
Music Art was negotiated between the president of Music Art and our president.
Music Art's business consisted of the marketing and sale of reproductions of
signed lithographs of the Rolling Stones and photos of Bruce Springsteen signed
by well known rock photographer, Phil Cecola, a famous rock-and-roll group
photographer. The tangible assets acquired primarily consisted of Rolling Stones
signed lithographs and photos of Bruce Springsteen signed by Phil Cecola. We did
not acquire any new distribution channels through the transaction. We did
acquire a database owned by Music Art, consisting of several thousand named
persons who had purchased Music Art products in the past along with individuals
and businesses that previously had been contacted by Music Art with a view to
distribution of its products. The license relating to the Rolling Stones covers
the marketing and sale of 16 signed in-plate lithographs based on their album
covers and tour art. A royalty of twenty five percent (25%) was required to be
paid based on net sales of these lithographs with a fixed minimum for framed and
unframed pieces. The license agreement under which these products are being sold
expired September 30, 1999 with subsequent sales being sold pursuant to an
unwritten extension under the same terms and conditions as the license
agreement. One of the major assets of Music Art was its license with the Rolling
Stones who were expected to extend Music Art's license in anticipation of going
on tour. When the Rolling Stones decided not to go on tour until 2002 we
anticipated obtaining other licenses for Music Art during fiscal 2002, however,
these did not materialize. We believe the license associated with this
acquisition has expired and has determined that the cost to renew is not
justified by the potential short-term revenue stream. As of February 28, 2002,
all goodwill related to Music Art has been reclassified to discontinued
operations.


                                       2
<PAGE>

         In July/August, 2000, our subsidiary, Team Sports Specialties, Inc.
acquired the assets of Rooter Rattle, Ltd. Part of the consideration for that
acquisition was shares of our common stock. In connection with the acquisition,
we agreed with Rooter Rattle that if certain conditions with respect to our
stock issued to Rooter Rattle were not met on or before the first anniversary of
closing, we would either pay Rooter Rattle an amount of $545,000 or transfer to
Rooter Rattle, free and clear of all liens and encumbrances, the stock of Team
Sports. The conditions with respect to our common stock were not met, and
therefore under the agreement, we were required to pay to Rooter Rattle $545,000
or deliver the stock of Team Sports free and clear of all encumbrances. In
addition, we have not paid the $30,000 principal outstanding on a Promissory
Note issued to Rooter Rattle in connection with the acquisition, and the Note is
in default. August 2002, we received notice from the partners of Rooter Rattle,
LP declaring our wholly-owned subsidiary, Team Sports Specialty Corporation in
default under certain terms of the August 3, 2000 Purchase and Sale Agreement
between Team Sports and Rooter Rattle, LP. The partners of Rooter Rattle, LP and
we have verbally agreed to have all assets of Team Sports, less certain
liabilities to the extent that the liabilities would exceed the assets given
back to Rooter Rattle, LP by $150,000, would revert back to Rooter Rattle, LP as
provided for in the event of default as defined in the agreement. We have not
recognized any revenue from Team Sport Specialties Corporation since of August
1, 2001. As of February 28, 2002, all goodwill related to Team Sports has been
reclassified to discontinued operations.

                              CURRENT PRODUCT LINES

         Following the migration to entertainment related licenses, our product
line is currently comprised of items principally related to movie releases and
other figures including comic book characters. Revenues for the current year
were derived principally from the sale of X-Men, Lord of the Rings and Marvel
character products. These included wall scrolls depicting images from Marvel
comic books and the Lord of the Rings movie printed on silk-like fabrics, and
letter openers, dog tags, replicas of a jet plane and rings from the X-Men
movie. Additional revenues were also produced from the sale of products related
to Terminator and Austin Powers licenses. The Lord of the Ring and Austin Powers
licenses were terminated in September 2002 as a result of the New Line Cinema
legal actions, and this significantly impacted sales because the Company was
unable to continue to market popular product under these licenses.

                              DISTRIBUTION CHANNELS

         We sell our collectible and high-end novelty products through
retailers, distributors, department stores and catalogers. Historically, we have
placed our products in over 4,500 retail locations including Spencer Gifts,
Claire's Boutique, Musicland, Tower Records, Halloween and costume shops, and a
growing list of retailers. We entered the Internet E-commerce world with our
websites: Austin Powers Collector's Club.com, Mini-V.com, collectbaseball.com,
X-menclub.com, MarvelFanclub.com and Terminator website. Revenues from these web
sites proved to be insufficient to cover the costs of maintaining them and we
decided to eliminate our proprietary web sites in favor of selling our products
through established Internet sites such as Amazon.com, BigE.com, Newline.com,
Toysrus.com, iQVC.com, Moletown.com, Musicland.com, Boscos.com,
Anotheruniverse.com, Galacticquest.com, and Nightflightcomics.com.

                       SUBSEQUENT EVENTS AND DEVELOPMENTS

         In August 2003, we reevaluated our business strategy viewing it in the
light of our declining performance in producing products in time for movie
releases and the resulting loss of potential revenue, profits and operating
income. It was determined that we did not have sufficient capital or human
resources to assume the full responsibility for all aspects of the business and,
in particular, the high cost of product development, manufacturing and
inventory. Furthermore, any financing we were successful in obtaining was
utilized in maintaining basic operations and conducting the necessary accounting
and other functions required to bring our filings up to date and back into
compliance with SEC regulations. Therefore, we proceeded to restructure the
business in an effort to leverage our strengths and move the responsibility for
those elements that we deemed unable to manage in a cost effective or efficient
way, to third parties. This strategy was more than simply outsourcing various
operating functions although we did outsource several administrative components
including internal accounting, fulfillment and warehousing. The new business


                                       3
<PAGE>

configuration was designed to go beyond traditional outsourcing maneuvers and
was intended to eliminate our role as primary party in the development and
manufacturing of products and allow us to focus our activity on those things
that we believe we are best equipped to execute; obtaining important licenses,
product conception and design, and marketing and distribution.

                                NEW OPPORTUNITIES

         We have proceeded to actively seek entities with products whose
marketability would be enhanced by the application of images, logos and other
identifying symbols available through licenses we had or could obtain. An
important part of this strategy was to seek products that had a more
"mainstream" appeal than the pure novelties and collectibles we have
historically marketed but still be driven by the "brand" appeal our licenses
would provide. These parameters led us to seek product partners whose goods
addressed three important areas; the children's market, college market and the
professional sports market. These sectors represented new market opportunities
for us; the college and children's segments are renewable markets, producing a
fresh group of consumers every year; licensed goods sales are extremely
prevalent in children's marketing circles and typically not limited to single
products; the college marketplace extends beyond that of the current student
bodies and includes the alumni populations as well; the collegiate and
professional sports markets are well known as popular areas for the distribution
of various promotional items bearing team and sponsor company logos and slogans.
Our long history and experience in the sports markets provide additional
benefits to this endeavor. During the periods of fiscal 2003 and 2004, we
entered into several relationships consistent with our new business strategy.

         LogoLite: In February of 2003 the Company entered into a Joint Venture
called LogoLite with Jade Accessories, Inc. located in Pennsylvania. The
products are mobile telephone batteries bearing various licensed images or
logos. Under the terms of the joint venture agreement, Jade Accessories is
responsible for providing the batteries, which are replacement batteries for
most popular brands of mobile telephones. These are specially configured
batteries containing a series of lights that can be arranged in prescribed
designs, colors and flashing sequences. The battery case is laser cut with logos
or images authorized under licenses we have or are obtaining. The laser cut
images are translucent and when a call is received or initiated, the lights on
the battery begin flashing and appear vividly through the translucent image on
the battery case. We are responsible for obtaining the necessary licenses,
design of the images and the marketing of the products. Jade Accessories is
responsible for the provision of the finished products in accordance with the
specifications supplied by us. The LogoLite battery products are targeted
primarily at the collegiate and professional sports markets. As of the date of
this report, nothing has transpired under this joint venture.

         Mighty Volt: On November 8, 2003, we modified a previous joint venture
agreement dated March of 2003 with Pivotal Self Service Technologies, Inc. and
entered into a Royalty and Services Agreement with Pivotec, a Division of
Pivotal Self Service Technologies, Inc. Through its parent company, Pivotec
imports a variety of flashlight and battery products from abroad. Under the
terms of the new agreement, we will assist Pivotec in obtaining licenses and
managing other aspects of the business of selling licensed flashlight and
battery products. Any licenses obtained in this manner will be titled to Pivotec
and we will receive a 1% royalty on net sales of any flashlight and/or battery
products containing images available either from licenses we have or assisted in
obtaining for Pivotec. Additionally, we may sell these licensed products through
our own distribution channels and will receive a sales commission based on a
formula of several variables that is expected to produce an average commission
of 15% of the sale price.

         {212} Media LLC: On December 29, 2003, we and {212} Media LLC executed
a Manufacturing and Distribution Agreement for the purpose of facilitating the
manufacturing and distribution of an audio book series comprised of a collection
of Arthur stories, a popular children's book character by author Marc Brown. In
conjunction with {212} Media, we will be responsible for the design,
manufacture, promotion and distribution of the audio books. Each of the
children's stories will be read and recorded by a celebrity figure giving added
marketing appeal. Several celebrities have been enlisted to participate in this
program and we expect that others will be added. All costs associated with the
production of the audio books will be borne by {212} Media. We will receive a
20% markup over manufacturing cost from {212} Media plus a distribution fee
ranging from 8% to 15% of wholesale prices. Additionally, an override fee of 3%
of wholesale price will be paid to us.


                                       4
<PAGE>

         Fanbana: On December 3, 2003, we secured an Alliance and Co-Marketing
Agreement with CLP Group LLC under which we and CLP will market the Banaworld
product line featuring the Fanbana which is a self-retracting, rollout banner
manufactured using a plastic material that has a "memory" for its original
shape. We believe that the Fanbana is an excellent product for sale into the
collegiate and professional sports markets as well as to political organizations
and corporations. Inexpensive, compact and versatile, the Fanbana may be used to
deliver promotional messages in a novel and entertaining way. We plan to market
the Fanbana to companies promoting their products through college and
professional sports teams and to the major political parties and believe that
these markets could produce significant Fanbana sales.

                               MARKETING STRATEGY

         We create and market unique collectible products for the entertainment
and sports markets. We are not a manufacturer, but rather source our products
from a wide range of manufacturing partners throughout the world. We market our
products primarily through various distributors and independent sales
organizations that collectively cover all of North America. We utilize outside
sales representatives to sell to the toy, gift, electronic, auto, novelty,
Halloween costume, food and drug chains and distributors. We also market our
merchandise directly to consumers online through established websites such as
Amazon.com and others. Our independent representatives also sell to mass
merchandisers such as Target, Wal-Mart and K-Mart as well as smaller chains and
independently owned stores. The independent sales representatives take orders
from customers for our products. We introduced a "Time Stock Rotation Program"
for retail store clients. The "Time Stock Rotation Program" is based upon the
"Plan -O-Gram" practice whereby the major retail chains control their inventory
and keep products on the shelf through this inventory management technique. By
using this method when a sale is recorded at the checkout the system immediately
registers the sale in the inventory control program and replacement product is
ordered automatically to insure full stock at all times. We have taken and
modified this concept and made it accessible to smaller chains and independent
retailers. "Time Stock Rotation Program" monitors the inventory of these retail
chains and makes new products available to them through a rotation process where
older items are replaced with higher selling items. We plan to explore new
markets that will enable us to leverage our strengths in licensing and
distribution and expand our product lines to address more stable and mainstream
markets.

         We do not believe we can clearly define the cash needs to stabilize and
expand our business. We continue to investigate various merger and acquisition
opportunities and routinely examined license opportunities. Accordingly, there
may be significant variation in the range of dollars needed if any of these
potential business arrangements come to fruition. In general, the fixed cost of
a license, or minimum royalty, can range from $10,000 to $50,000, plus royalties
earned over the minimum, and would normally cover a two or three-year period.
While we have refocused our business model to ameliorate traditional product
development and production costs, actual costs will vary depending upon the
nature and type of the product to be developed and the expected revenue stream
to the licensor. Our pre-production activity includes prototype and sample
package and display artwork and models, all of which may go through several
iterations as both we and the licensor review the samples. Historically,
pre-production costs also included tooling costs, which were capitalized, and
the other pre-production costs that were expensed. In the past, these
pre-production costs have ranged from $5,000 to $100,000.

         As of February 28, 2003, we had accounts payable and accrued expenses
of approximately $2,989,753 and over $1,612,737 in loans, notes and debentures
due or coming due within the next 12 months. We do not currently have sufficient
financial resources to meet these obligations and will depend on new outside
financing to satisfy our pending obligations. We also lack adequate financial
resources to purchase inventory and meet all of the financial commitments
necessary to enter into new product ventures, and will depend on new outside
financing to further these efforts. There can be no assurance that we will be
able to obtain additional adequate outside financing to purchase inventory, meet
our current obligations or continue to expand our operations. We would not be
able to continue at our current staffing and expense levels without additional
cash from cash sales, collection of accounts receivable or additional funding.

         Further, our success in marketing products based upon motion pictures
is largely dependent upon the box office success of the films. Thus, there can
be no assurance that any licensing rights that we may obtain will prove
profitable.


                                       5
<PAGE>

                                   COMPETITION

         We believe that direct competition for obtaining licenses in our
primary business line, reproductions and collectibles based on movie props, is
not a factor. Generally, we believe we will receive licenses in most of the
cases where we seek them. However, most of these licenses will be non-exclusive.
We are not aware of any exclusive relationships between retailers and
collectible product distributors, and therefore, we and all other competitors
are free to compete for the shelf space and other resources of retailers.
However, large nationally known distributors of toys and other products may have
more bargaining power to demand shelf space. Generally, we do not believe that
there are high barriers to entry in the collectibles market, except for the
high-end limited editions market where individual products tend to have retail
purchases of $130 to $495. Even though these licenses are non-exclusive, we have
not experienced direct competition in the form of other companies licensing and
producing the same collectibles. We experience our most significant competition
in obtaining shelf space in retail outlets for our products, however, under the
new business configuration that channels our efforts and talents through
partnerships and strategic relationships with other entities with existing
products, the impact of competition is greatly softened and actually reduced to
the level of competing for the strategic relationship rather than competing for
the end-user consumer. Here, the strength of our licenses and/or product
positions (as in the case of our exclusive marketing rights for the Fanbana),
serve to neutralize competition and afford us a clearer path to market.

                                  MANUFACTURERS

         We do not manufacture our own products, but rely on outside
manufacturers. Several of these outside manufacturers are located overseas and
we believe that there are sufficient numbers of manufacturers that we will not
have to rely upon any single source and will be able to obtain alternative
manufacturing facilities if chosen manufacturers do not perform. We generally
enter into exclusive manufacturing agreements with our manufacturers for a
single product, but may use various manufacturers for all of the products in a
series. The main raw materials used by our manufacturers are plastics, pewter,
resins and packaging material. We do not believe that there is any significant
risk of shortages in these raw materials, nor is fluctuation in the price of
these raw materials likely to have an adverse impact on our costs or profit
margins. All of our manufacturing agreements are U.S. dollar denominated, so we
generally do not face exchange rate risks. Subsequent to February 28, 2003, we
further ameliorated any potential risks associated with raw materials or the
manufacture of products in general, by modifying our strategic business plan and
deploying our efforts through partnerships and/or strategic relationships with
entities that have products whose marketability may be enhanced by the addition
of images or logos made possible by licenses we have or may obtain.

                              INTELLECTUAL PROPERTY

         We have several key licenses on which the continued success of our
business is dependent. These include the license with Marvel for their Marvel
Characters library and for collectibles related to the X-Men film, the licenses
with Canal + DA and Creative Licensing for products related to the Terminator
films.

EMPLOYEES

         As of February 28, 2003, we had five full time employees, of which two
are management, two are marketing and one shipping and delivery. In addition, we
had one part time employee and three independent consultants. We consider our
relations with our employees to be good.

ITEM 2. DESCRIPTION OF PROPERTY.

         Our executive and principal administrative offices are located at 1600
Lower State Road, Doylestown, Pennsylvania 18901, where we currently occupy
approximately 2,600 square feet of office space pursuant to a lease entered into
with Hartsville Real Estate. The term of the lease is three years, expiring in
September 2004. The monthly rental payments under the lease are $1,840. We
believe that our leased property is sufficient for our current and immediately
foreseeable operating needs.


                                       6
<PAGE>

ITEM 3. LEGAL PROCEEDINGS.

         From time to time, we may become involved in various lawsuits and legal
proceedings, which arise, in the ordinary course of business. However,
litigation is subject to inherent uncertainties, and an adverse result in these
or other matters may arise from time to time that may harm our business. Except
as disclosed below, we are currently not aware of any such legal proceedings or
claims that we believe will have, individually or in the aggregate, a material
adverse affect on our business, financial condition or operating results.

         We are required to pay a royalty of ten percent (10%) on sales of the
products licensed from Chicken Soup for the Soul Enterprises, with a minimum
royalty of $50,000. We paid $15,000 at the time of signing the license with
$10,000 due upon the first shipment of product. Efforts to terminate the license
agreement were unsuccessful and CSSE has threatened litigation to recover the
minimum royalty fee. To date, we have not received either a summons or
complaint. The balance of the minimum royalty has been accrued as of February
28, 2003.

         In September 2002, we were served with an Order of Permanent Injunction
by New Line Cinema enjoining us from distributing any goods or services relating
to "Austin Powers" or the "Lord of the Rings". Sales of Austin Power products
were insufficient to pay the minimum royalty at the contractual royalty rates
although a payment of $35,000 had been made in November 2001 and was applied to
the Austin Powers minimum royalty requirement. Shortly after the injunction, New
Line Cinema initiated litigation against us for license infringement seeking $5
million in damages. We and New Line Cinema have since reached a settlement
agreement resolving the litigation. Under the agreement, the terms of the
settlement are strictly confidential however; we believe that the settlement
will not have a material adverse effect on us. The balance of the minimum
royalty has been accrued as of February 28, 2003.

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

         In July 2002 we voted to increase the number of authorized shares from
350,000,000 to 700,000,000. At the same time, we also voted to have a one for
seventy reverse stock split.


                                       7
<PAGE>

                                     PART II

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

                            MARKET FOR COMMON EQUITY

         Our common stock trades on the Pink Sheets under the symbol "CCGI."

         For the periods indicated, the following table sets forth the high and
low bid prices per share of common stock. These prices represent inter-dealer
quotations without retail markup, markdown, or commission and may not
necessarily represent actual transactions.

                                           Low($)     High($)
                                           ------     -------
2003
----
First Quarter                               0.01       0.01
Second Quarter                              0.01       0.01
Third Quarter                               0.01       0.01
Fourth Quarter                              0.01       0.01

         As of June 30, 2004, management believes there to be approximately 940
holders of record of our common stock. To date, we have not paid any dividends
on our common stock. We do not currently intend to pay dividends in the future.

                     RECENT SALES OF UNREGISTERED SECURITIES

         The shares described below represent certain equity securities of
Collectible Concepts Group sold by Collectible Concepts Group during the period
covered by this report that were not registered under the Securities Act, all of
which were issued by Collectible Concepts Group pursuant to exemptions under the
Securities Act. Underwriters were involved in none of these transactions. In
each case, the securities were sold to accredited investors, as determined by an
investor questionnaire executed in conjunction with the respective subscription
agreements.

PRIVATE PLACEMENTS OF COMMON STOCK AND WARRANTS FOR CASH

<TABLE>
<CAPTION>
---------------------------- ----------------------- ---------------------- ---------------
         Purchaser           Shares of Common Stock       Price Paid         Date Issued
---------------------------- ----------------------- ---------------------- ---------------
<S>                               <C>                       <C>             <C>
Henry Konopka                       142,857                 $ 2,000         06/26/02
---------------------------- ----------------------- ---------------------- ---------------
Barry Schockley                     142,857                   2,000         06/26/02
---------------------------- ----------------------- ---------------------- ---------------
Richard Elmore                      142,857                   2,000         06/26/02
---------------------------- ----------------------- ---------------------- ---------------
Debra Lawson                      1,000,000                   2,000         08/09/02
---------------------------- ----------------------- ---------------------- ---------------
Robert Yastrzemski                1.000,000                   2,000         08/09/02
---------------------------- ----------------------- ---------------------- ---------------
John Zagorski                     1.000.000                   2,000         08/09/02
---------------------------- ----------------------- ---------------------- ---------------
Gilbert Bowman Jr.                1.000.000                   2,000         08/09/02
---------------------------- ----------------------- ---------------------- ---------------
Ray Maiwurm                       6,000,000                   6,000         08/09/02
---------------------------- ----------------------- ---------------------- ---------------
Paul Lipschutz                    5,000,000                   5,000         08/09/02
---------------------------- ----------------------- ---------------------- ---------------
Gilbert Bowman Jr.                1,000,000                   1,000         12/19/02
---------------------------- ----------------------- ---------------------- ---------------
Robert Yastrzemski                1,000,000                   1,000         12/19/02
---------------------------- ----------------------- ---------------------- ---------------
Debra Lawson                      1,000,000                   1,000         12/19/02
---------------------------- ----------------------- ---------------------- ---------------
John Zagorski                     1,000,000                   1,000         12/19/02
---------------------------- ----------------------- ---------------------- ---------------
Tom Milberry                      2,000,000                   2,000         01/29/03
---------------------------- ----------------------- ---------------------- ---------------
Roy Maiwurm                       2,000,000                   2,000         01/29/03
---------------------------- ----------------------- ---------------------- ---------------
Ray Maiwurm                       2,000,000                   2,000         01/29/03
---------------------------- ----------------------- ---------------------- ---------------
Ray Maiwurm                       2,000,000                   2,000         01/29/03
---------------------------- ----------------------- ---------------------- ---------------
Judith Maiwurm                    2,000,000                   2,000         01/29/03
---------------------------- ----------------------- ---------------------- ---------------
Allyson Maiwurm                   2,000,000                   2,000         01/29/03
---------------------------- ----------------------- ---------------------- ---------------
</TABLE>


                                       8
<PAGE>

SALES OF DEBT FOR CASH

         None.

OPTION GRANTS

         None.

ISSUANCES OF STOCK FOR SERVICES OR IN SATISFACTION OF OBLIGATIONS

--------------------------------------------------------------------------------
                                    Shares of           Value of         Date
             Name                  Common Stock         Services        Issued
--------------------------------------------------------------------------------
Jeff Andrews                          673,857            $23,585       04/23/02
--------------------------------------------------------------------------------
Paul Lipschutz                      1,639,000             57,365       04/23/02
--------------------------------------------------------------------------------
Jeff Andrews                              714                 25       04/23/02
--------------------------------------------------------------------------------
Paul Lipschutz                            714                 25       04/23/02
--------------------------------------------------------------------------------
Paula Singh                           500,000             15,000       06/26/02
--------------------------------------------------------------------------------
Robert Kogen                          500,000             15,000       06/26/02
--------------------------------------------------------------------------------
Robert Corrigan                       714,285             21,429       06/26/02
--------------------------------------------------------------------------------
Joseph Simone                         250,000              7,500       06/26/02
--------------------------------------------------------------------------------
Paul Lipschutz                        500,000             15,000       06/26/02
--------------------------------------------------------------------------------
Paul Lipschutz                        500,000             15,000       06/26/02
--------------------------------------------------------------------------------
Paul Lipschutz                        500,000             15,000       06/26/02
--------------------------------------------------------------------------------
Paul Lipschutz                        500,000             15,000       06/26/02
--------------------------------------------------------------------------------
Jay Lipschutz                          73,000              2,190       06/26/02
--------------------------------------------------------------------------------
Richard Weaver                         20,000                600       06/26/02
--------------------------------------------------------------------------------
Jeff Baird                             50,000              1,500       06/26/02
--------------------------------------------------------------------------------
William Hoffman Esq.                  200,000              6,000       06/26/02
--------------------------------------------------------------------------------
Richard Day                           500,000             15.000       06/26/02
--------------------------------------------------------------------------------
Norm Jacobs                           250,000              7,500       06/26/02
--------------------------------------------------------------------------------
Marshall Braunscheig                  200,000              6,000       06/26/02
--------------------------------------------------------------------------------
National Financial Comunications      600,000             18,000       06/26/02
--------------------------------------------------------------------------------
Ira Fox                               150,000              4,500       06/26/02
--------------------------------------------------------------------------------
Michael Lipschutz                     250,000              6,250       07/17/02
--------------------------------------------------------------------------------
Gene Weiss                            250,000              6,250       07/17/02
--------------------------------------------------------------------------------
Richard Day                           200,000              5,000       07/17/02
--------------------------------------------------------------------------------
William Hoffman Esq.                  200,000              5,000       07/17/02
--------------------------------------------------------------------------------
Paul Lipschutz                        500,000             12,500       07/17/02
--------------------------------------------------------------------------------
Paul Lipschutz                        500,000             12,500       07/17/02
--------------------------------------------------------------------------------
Paul Lipschutz                        500,000             12,500       07/17/02
--------------------------------------------------------------------------------
Scott Lonker                          100,000              2,500       07/17/02
--------------------------------------------------------------------------------
Katie Lonker                          100,000              2,500       07/17/02
--------------------------------------------------------------------------------
Stephanie Hoffman                     100,000              2,500       07/17/02
--------------------------------------------------------------------------------
Lorraine Lipschutz                    200,000              5,000       07/17/02
--------------------------------------------------------------------------------
Philip Verruto                      3,500,000             38,500       08/09/02
--------------------------------------------------------------------------------


                                       9
<PAGE>

--------------------------------------------------------------------------------
Robert Kramer                       4,000,000             44,000       08/09/02
--------------------------------------------------------------------------------
American Registrar & Transfer       1,500,000             16,500       08/09/02
--------------------------------------------------------------------------------
Jay Lipschutz                         350,000              3,850       08/20/02
--------------------------------------------------------------------------------
Robert Corrigan                       750,000              8,250       08/20/02
--------------------------------------------------------------------------------
Roy Mittman                         4,000,000             44,000       08/20/02
--------------------------------------------------------------------------------
Reba Budowsky                       3,000,000             33,000       08/20/02
--------------------------------------------------------------------------------
Jos Paykin                          1,000,000             11,000       08/20/02
--------------------------------------------------------------------------------
Richard Liebman                       300,000              3,300       08/20/02
--------------------------------------------------------------------------------
Richard Liebman                       300,000              3,300       08/20/02
--------------------------------------------------------------------------------
William Hoffman Esq.                  600,000              6,600       10/04/02
--------------------------------------------------------------------------------
Kenneth Volstrad                    2,000,000             22,000       10/04/02
--------------------------------------------------------------------------------
Paul Lipschutz                      3,000,000             30,000       12/19/02
--------------------------------------------------------------------------------
Jay Lipschutz                          10,000                100       12/19/02
--------------------------------------------------------------------------------
Michelle Buchman                       10,000                100       12/19/02
--------------------------------------------------------------------------------
Richard Cohen                          20,000                200       12/19/02
--------------------------------------------------------------------------------
Richard Weaver                         10,000                100       12/19/02
--------------------------------------------------------------------------------
Paul Lipschutz                      2,000,000             20,000       02/28/03
--------------------------------------------------------------------------------
Claire Verruto                      3,000,000             30,000       02/28/03
--------------------------------------------------------------------------------
Martin Rhodes                         500,000              5,000       02/28/03
--------------------------------------------------------------------------------
Daniel Goldberg                       500,000              5,000       02/28/03
--------------------------------------------------------------------------------
Roger Taylor                          300,000              3,000       02/28/03
--------------------------------------------------------------------------------
Richard Day                           250,000              2,500       02/28/03
--------------------------------------------------------------------------------
Christine Mittman                   2,500,000             25,000       02/28/03
--------------------------------------------------------------------------------

ISSUANCES OF STOCK FOR CONVERTION OF DEBT

(EXCLUDING INTEREST AND GAIN OR LOSS ON CONVERSION OF DEBT)

--------------------------------------------------------------------------------
                                         Shares of        Value of        Date
             Name                       Common Stock        Debt         Issued
--------------------------------------------------------------------------------
AJW Partners                                892,857        $2,500       11/04/02
--------------------------------------------------------------------------------
New Millenium Capital Partners, LLC         892,857         2,500       11/04/02
--------------------------------------------------------------------------------
Equilibrium Equity, LLC                     446,429         1,250       11/04/02
--------------------------------------------------------------------------------
AJW Partners                                714,286         1,000       12/04/02
--------------------------------------------------------------------------------
New Millenium Capital Partners, LLC         714,286         1,000       12/04/02
--------------------------------------------------------------------------------
Equilibrium Equity, LLC                     607,143           850       12/04/02
--------------------------------------------------------------------------------
AJW Partners                                909,091         1,000       01/06/03
--------------------------------------------------------------------------------
New Millenium Capital Partners, LLC         909,091         1,000       01/06/03
--------------------------------------------------------------------------------
Equilibrium Equity, LLC                     772,727           850       01/06/03
--------------------------------------------------------------------------------
AJW Partners                                909,091         1,000       01/09/03
--------------------------------------------------------------------------------
New Millenium Capital Partners, LLC         909,091         1,000       01/09/03
--------------------------------------------------------------------------------
Equilibrium Equity, LLC                     772,727           850       01/09/03
--------------------------------------------------------------------------------
AJW Partners                              1,333,333         2,000       02/13/03
--------------------------------------------------------------------------------
New Millenium Capital Partners, LLC       1,333,333         2,000       02/13/03
--------------------------------------------------------------------------------
Equilibrium Equity, LLC                     666,667         1,000       02/13/03
--------------------------------------------------------------------------------
Christine Mittman                         2,509,524        26,500       02/28/03
--------------------------------------------------------------------------------
Leonard Cohen                               664,832        33,242       02/28/03
--------------------------------------------------------------------------------


                                       10
<PAGE>

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

         Some of the information in this Form 10-KSB contains forward-looking
statements that involve substantial risks and uncertainties. You can identify
these statements by forward-looking words such as "may," "will," "expect,"
"anticipate," "believe," "estimate" and "continue," or similar words. You should
read statements that contain these words carefully because they:

      o     discuss our future expectations;

      o     contain projections of our future results of operations or of our
            financial condition; and

      o     state other "forward-looking" information.

         We believe it is important to communicate our expectations. However,
there may be events in the future that we are not able to accurately predict or
over which we have no control. Our actual results and the timing of certain
events could differ materially from those anticipated in these forward-looking
statements as a result of certain factors, including those set forth under "Risk
Factors," "Business" and elsewhere in this prospectus. See "Risk Factors."

GENERAL

         We earn revenues from distributing high-end and novelty products
principally related to the entertainment and sports industries. These products
are sold through retailers, distributors, department stores, the Internet and
catalogs.

         During the twelve months ended February 28, 2002, we signed a license
agreement with C3 Entertainment to make, market and produce scrolls, pins and
desktop collectibles for The Three Stooges(R). Subsequent to February 28, 2003,
we amended our license agreement with C3. The amendment had the effect of
extending the license from January 1, 2004 through December 31, 2005.
Additionally, the advance royalty payment of $5,000 was made payable in ten
monthly installments of $500 each beginning January 15, 2004. The total
guaranteed royalty under the amendment was $10,000. All other aspects of the
original agreement remained in full force and effect.

         On July 21, 2003, we and Marvel Entertainment mutually agreed to
terminate The Marvel Fan Club license. There will be no residual liability due
Marvel Entertainment regarding this license.

         On September 9, 2002, we were served with an Order of Permanent
Injunction by New Line Cinema enjoining us from distributing any goods or
services relating to "Austin Powers" or the "Lord of the Rings". Sales of Austin
Power products were insufficient to pay the minimum royalty at the contractual
royalty rates although a payment of $35,000 was made in November 2001 and was
applied to the Austin Powers minimum royalty requirement. Shortly after the
injunction, New Line Cinema initiated litigation against us for license
infringement seeking $5 million in damages. We and New Line Cinema have since
reached a settlement agreement resolving the litigation. Under the agreement,
the terms of the settlement are strictly confidential however, we believe that
the settlement will not have a material adverse effect on us.

         In December 2000, we signed a licensing agreement to distribute,"
Tattle Tail". The royalty rate for this license is 7% of sales. A minimum
royalty amount of $85,000 was payable by November 30, 2003, the expiration date
of the license. This amount is still outstanding as of the date of this report.

         In December 2003, we and Marvel Entertainment mutually agreed to extend
the term of our X-Men and Marvel Character licenses for an additional six
months. Marvel Entertainment also agreed to extend the June 30, 2002 minimum
payment date for the Marvel Character license to December 31, 2002. As of the
date of this report, the Company is under renegotiations to further extend the
terms of these agreements.

         On November 11, 2002, we executed a license agreement for the
"Terminator - 3 Rise of the Machines" movie. This license is effective through
December 31, 2004 and has a minimum royalty payment of $50,000 payable in
several installments. A 12% royalty is payable on all sales under this license.


                                       11
<PAGE>

         On December 29, 2003 we and {212} Media LLC executed a Manufacturing
and Distribution Agreement for the purpose of facilitating the manufacturing and
distribution of an audio book series comprised of a collection of Arthur
stories, a popular children's book character by author Marc Brown. In
conjunction with {212} Media, we will be responsible for the design,
manufacture, promotion and distribution of the audio books. The recorded stories
are to be read by a group of selected celebrities. All costs associated with the
production of the audio books will be borne by {212} Media. We will receive a
20% markup over manufacturing cost from {212} Media plus a distribution fee
ranging from 8% to 15% of wholesale prices. Additionally, an override fee of 3%
of wholesale price will be paid to us. The agreement remains in effect on a
product-by-product basis.

         In August of 2003, we re-evaluated our business model. We believe that
licenses have evolved into more time sensitive and sale spiking properties and
that these characteristics create serious problems for us both at the financial
and logistics levels. Accordingly, we are not renewing or continuing licenses
that do not fit our new business model. Our new business model will be focused
on more evergreen properties and those with a bigger window of opportunity. We
believe that with the new genre of films being so heavily oriented to characters
of comic books and fantasies that we will pursue licenses mostly in that
category and to supplement them with new trend properties as they appear.
Furthermore, we recognized the need to have products that addressed the
mainstream consumer market where market size and repeat sales opportunities
could give us a means to stabilize and grow our revenues. To avoid the time,
expense and risks associated with in-house new product development, we sought
out entities with mainstream consumer products whose marketability could be
enhanced by the addition of our licenses.

         When we shifted our focus to entertainment and movie related licenses,
we decided not to further pursue the Chicken Soup business opportunity presented
in the license agreement executed on May 1, 2000 with Chicken Soup for the Soul
Enterprises, which expired on December 31, 2002. We are required to pay a
royalty of ten percent (10%) on sales of the products licensed from Chicken Soup
for the Soul Enterprises, with a minimum royalty of $50,000. We paid $15,000 at
the time of signing the license with $10,000 due upon the first shipment of
product. Efforts to terminate the license agreement were unsuccessful and
Chicken Soup for the Soul Enterprises has threatened litigation to recover the
minimum royalty fee.

         In February of 2003, we entered into a LogoLite Joint Venture Agreement
with Jade Accessories, Inc. located in Pennsylvania. Under the terms of the
agreement, Jade Accessories will be providing replacement batteries for most
popular brands of mobile telephones. These are specially configured batteries
containing a series of lights that can be arranged in prescribed designs, colors
and flashing sequences. The battery case is laser cut with logos or images
authorized under licenses we have or are obtaining. The laser cut images are
translucent and when a call is received or initiated, the lights on the battery
begin flashing and appear vividly through the translucent image on the battery
case. We are responsible for obtaining the necessary licenses, design of the
images and the marketing of the products. Jade Accessories is responsible for
the provision of the finished products in accordance with the specifications
supplied by us. We are targeting the sports and college markets as primary for
the LogoLite battery products.

         In March of 2003, we entered into a Joint Venture Agreement with
Pivotal Self-Service Technologies, Inc. a Canadian company to produce and market
flashlight and battery products utilizing Pivotal's offshore manufacturing
resources and our licensing and marketing capabilities. In connection with this
joint venture, we modified its pending license agreement for Terminator 3 to
include flashlights and batteries along with scrolls, pins and other desktop
collectibles. Upon signing of this agreement Pivotal paid us $9,000 which was
used as the initial payment against the $50,000 guaranteed royalty for the
Terminator 3 license. Subsequent to February 28, 2003, the Joint Venture
Agreement was dissolved and a new Royalty and Services Agreement was entered
into with Pivotec, a Division of Pivotal Self Service Technologies, Inc. Under
the terms of the new agreement, we sold the Mighty Volt trade name and all
intellectual property rights developed by us in the previous joint venture with
Pivotal Self Service Technologies, Inc. in exchange for 500,000 restricted
shares of Pivotal Self Service Technologies, Inc. common stock. We will assist
Pivotec in obtaining licenses and managing other aspects of the business of
selling licensed flashlight and battery products. Any licenses obtained in this
manner will be titled to Pivotec. This agreement provides a 1% royalty to us on
net sales of any flashlight and/or battery products containing images available


                                       12
<PAGE>

either from licenses we have or assisted in obtaining for Pivotec. Additionally,
we may sell these licensed products and will receive a sales commission based on
a formula of several variables that is expected to produce an average commission
of 15% of the sale price. The agreement also contains a provision in which
Pivotec paid us $16,000 for services we performed in obtaining licenses, this
monies was paid as part the outstanding royalty guarantee in the Terminator 3
license agreement. We renegotiated the total advance on the guarantee amount to
$25,000 from the original amount of $50,000. Under the agreement, we will retain
ownership of the T-3 license.

         We have also outsourced our internal accounting functions. Stein,
Feldman and Sampson, LLC, has been retained to provide our general accounting
and bookkeeping requirements. This engagement is intended to improve our
efficiency in reporting and strengthen internal controls.

         Sales for the twelve months ended February 28, 2003 were comprised
primarily of products from Lord of the Rings, X-Men and Marvel comic hero
characters. Additional revenues were also produced from the sale of products
related to Terminator and Austin Powers licenses. The Lord of the Rings and
Austin Powers licenses were terminated in September 2002 as a result of the New
Line Cinema legal actions and this significantly impacted sales because the
Company was unable to continue to market popular products under these licenses.
In addition to income from traditional sources, revenue was generated from
Internet sales through e-bay. Entertainment related product sales differ from
the more traditional sports related products we have historically offered and
the timely availability of product samples has become a critical element in the
ability to successfully obtain orders from distributors and especially retailers
who prepare product sales plans (plan-o-gram) at least six months in advance.
Consumer demand for these entertainment products is most often driven directly
by the initial movie release and followed later by the video release. After
successfully obtaining movie related licenses, chronic cash constraints and
manufacturing lead times and volume requirements have seriously inhibited our
ability to provide these samples either in a timely manner or in a sufficient
variety or quantity to satisfy the needs of the sales force. Consequently, we
have missed the window of opportunity afforded us by certain of our licenses. We
are constantly seeking to remedy this serious problem by raising additional
working capital and, most importantly, by seeking new sourcing for our principal
products that can produce samples in a timely and cost effective way to support
the sales efforts. During the twelve months ended February 28, 2003, our
outsourcing vendor Maxim Logistics acquired a large-format digital printing
system that has the capability of producing a wide variety of products printed
on various fabrics. Our principal product in the entertainment field is our
Satin Scroll line. Maxim can produce scroll samples in any combination and in
any quantities desired by us in a matter of days as opposed to the months
required by previous suppliers of scrolls. Additionally, because the scrolls are
produced by advanced digital technology, they are of higher quality than
previously available to us. We expect that the Maxim sourcing will have a
positive effect on future sales of scrolls and similar products.

         Cost of sales for the twelve months ended February 28, 2003 were
comprised of costs associated with the sale of the products related to the Lord
of the Rings, Austin Powers, X-Men and Marvel comic hero characters. (In light
of the termination of the Lord of the Rings and Austin Powers licenses, on going
cost of sales was reduced commensurately with sales). These products are
contract manufactured for us by both domestic and foreign companies to
specifications developed by us and approved by the various licensors. We do not
feel this places us at risk for filling future orders on a timely basis because
we have developed relationships with alternate suppliers for most of our
products. This is especially evidenced by the arrangement with Maxim Logistics
who will be our principal provider of Satin Scrolls, one of our leading
products. Several of our manufacturers will also store and ship product directly
to a customer, thereby reducing shipping time and eliminating the costs we would
incur if the product was first shipped to our location. We also feels we are not
at risk for any currency fluctuations in our dealing with our foreign
manufacturers since all orders are based on U.S. dollars and we do not have any
long term purchase commitments.

         Selling, general and administrative expense consists of payroll and
related fringe benefits, royalties, commissions paid to manufacturers sales
representatives, advertising, rent, depreciation and other related fixed
overhead expenses. Also included in this category are the expenses related to
the replication of movie props to ready them for mass production by the contract
manufacturers, as well as the non-cash costs related to services satisfied by
the issuance of our stock. The services provided were in direct support of our
operations. As we grow through acquisitions and the sales of current product, we
anticipate we will have to rely less on the issuance of stock for services due
to increased cash flows as well as capital. The benefits to us from these stock
transactions are to reduce the use of cash, which allow us to devote the maximum


                                       13
<PAGE>

amount of resources to expanding the business. For accounting purposes, we
valued these services at the fair market value of the services rendered or the
fair market value of the stock at times of issuance whichever was more readily
determinable. Production costs include prototypes and samples of packaging,
displays and products. All expensed production costs are included within
selling, general and administrative expenses. Costs of manufacturing products
for sale are included within costs of sales.

         The amount and timing of the revenue generated from the sales of movie
related products is not possible to accurately predict because of the length of
time it may take the project to be commercially successful, if at all. As a
result, our revenues and net income may fluctuate significantly between
comparable periods. Additionally, since our inception, we have experienced
significant operating and net losses that we have been able to fund by obtaining
private capital. Therefore, we cannot predict if and when we will generate
income from operations and if we will be able to raise sufficient capital
necessary to fund future operations.

         As of the fiscal year ended February 28, 2003, we had an accumulated
deficit of $ 18,854,978. This deficit arose from operating losses and not any
particular transaction or transactions. We have not generated sufficient
revenues to meet our operating expenses. As a result, there is substantial doubt
about our ability to continue as a going concern.

CRITICAL ACCOUNTING POLICIES

         Our financial statements are prepared based on the application of
accounting principles generally accepted in the United States of America. These
accounting principles require us to exercise significant judgment about future
events that affect the amounts reported throughout our financial statements.
Actual events could unfold quite differently than our previous judgments had
predicted. Therefore the estimates and assumptions inherent in the financial
statements included in this report could be materially different once those
actual events are known. We believe the following policies may involve a higher
degree of judgment and complexity in their application and represent critical
accounting policies used in the preparation of our financial statements. If
different assumptions or estimates were used, our financial statements could be
materially different from those included in this report.

         Revenue Recognition: We recognize revenues in accordance with Staff
Accounting Bulletin 104, Revenue Recognition in Financial Statements (SAB 104).
We develop and sell collectibles in the entertainment, sports and music markets.
Revenue from such product sales is recognized when persuasive evidence of an
arrangement exists, delivery has occurred, the fee is fixed or determinable and
collectibility is probable. At this time the earnings process is complete and
the risks and rewards of ownership have transferred to the customer, which is
generally when the goods are shipped and all significant obligations of the
Company have been satisfied.

         Accounts Receivable: We must make judgments about the collectibility of
our accounts receivable to be able to present them at their net realizable value
on the balance sheet. To do this, we carefully analyze the aging of our customer
accounts, try to understand why accounts have not been paid, and review
historical bad debt problems. From this analysis, we record an estimated
allowance for receivables that we believe will ultimately become uncollectible.
As of February 28, 2003 , we had an allowance for bad debts of $2,740. We
actively manage our accounts receivable to minimize our credit risks and believe
that our current allowance for doubtful accounts is fairly stated.

         Realizability of Inventory Values: We make judgments about the ultimate
realizability of our inventory in order to record our inventory at its lower of
cost or market. These judgments involve reviewing current demand for our
products in comparison to present inventory levels and reviewing inventory costs
compared to current market values. As of February 28, 2003 and 2002, we recorded
a write-down to inventory of $0 and $143,732 to adjust certain lines for
obsolete inventory.

         Long-lived Assets. We assess the impairment of long-lived assets
whenever events or changes in circumstances indicate that their carrying value
may not be recoverable from the estimated future cash flows expected to result
from their use and eventual disposition. Our long-lived assets subject to this
evaluation include property and equipment. Intangible assets other than goodwill
are reviewed for impairment whenever events or changes in circumstances indicate
that the carrying value may not be fully recoverable. We are required to make
judgments and assumptions in identifying those events or changes in
circumstances that may trigger impairment.


                                       14
<PAGE>

RECENT ACCOUNTING PRONOUNCEMENTS

         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." SFAS No. 145 rescinds the provisions of SFAS No. 4, which requires
companies to classify certain gains and losses from debt extinguishments as
extraordinary items, eliminates the provisions of SFAS No. 44 regarding
transition to the Motor Carrier Act of 1980 and amends the provisions of SFAS
No. 13 to require that certain lease modifications be treated as sale leaseback
transactions. The provisions of SFAS No. 145 related to classification of debt
extinguishments are effective for fiscal years beginning after May 15, 2002,
with earlier application encouraged.

         In July 2002, the FASB issued SFAS No. 146, "Accounting for
Restructuring Costs." SFAS No. 146 applies to costs associated with an exit
activity (including restructuring) or with a disposal of long-lived assets.
Those activities can include eliminating or reducing product lines, terminating
employees and contracts and relocating plant facilities or personnel. Under SFAS
No. 146, the Company will record a liability for a cost associated with an exit
or disposal activity when that liability is incurred and can be measured at fair
value. SFAS No. 146 will require the Company to disclose information about its
exit and disposal activities, the related costs, and changes in those costs in
the notes to the interim and annual financial statements that include the period
in which an exit activity is initiated and in any subsequent period until the
activity is completed. SFAS No. 146 is effective prospectively for exit or
disposal activities initiated after December 31, 2002, with earlier adoption
encouraged. Under SFAS No. 146, a company cannot restate it's previously issued
financial statements and the new statement grandfathers the accounting for
liabilities that a company had previously recorded under Emerging Issues Task
Force Issue 94-3.

         In December 2002, the FASB issued SFAS No. 148, "Accounting for
Stock-Based Compensation-Transition and Disclosure - an amendment of FASB
Statement No. 123." SFAS No. 148 amends SFAS No. 123, "Accounting for Stock
Based Compensation" and provides alternative methods for accounting for a change
by registrants to the fair value method of accounting for stock-based
compensation. Additionally, SFAS No. 148 amends the disclosure requirements of
SFAS No. 123 to require disclosure in the significant accounting policy footnote
of both annual and interim financial statements of the method of accounting for
stock based-compensation and the related pro-forma disclosures when the
intrinsic value method continues to be used. The statement is effective for
fiscal years beginning after December 15, 2002, and disclosures are effective
for the first fiscal quarter beginning after December 15, 2002.

         In January 2003, The FASB issued Interpretation No. 46, "Consolidation
of Variable Interest Entities", an interpretation of Accounting Research
Bulletin ("ARB") No. 51, "Consolidated Financial Statements". Interpretation No.
46 addresses consolidation by business enterprises of variable interest
entities, which have one or both of the following characteristics: (i) the
equity investment at risk is not sufficient to permit the entity to finance its
activities without additional subordinated support from other parties, which is
provided through other interest that will absorb some or all of the expected
losses of the entity; (ii) the equity investors lack one or more of the
following essential characteristics of a controlling financial interest: the
direct or indirect ability to make decisions about the entities activities
through voting rights or similar rights; or the obligation to absorb the
expected losses of the entity if they occur, which makes it possible for the
entity to finance its activities; the right to receive the expected residual
returns of the entity if they occur, which is the compensation for the risk of
absorbing the expected losses.

         Interpretation No. 46 also requires expanded disclosures by the primary
beneficiary (as defined) of a variable interest entity and by an enterprise that
holds a significant variable interest in a variable interest entity but is not
the primary beneficiary. Interpretation No. 46 applies immediately to variable
interest entities created after January 31, 2003, and to variable interest
entities in which an enterprise obtains an interest after that date. It applies
in the first fiscal year or interim period beginning after June 15, 2003, to
variable interest entities in which an enterprise holds a variable interest that
it acquired before February 1, 2003. Interpretation No. 46 may be applied
prospectively with a cumulative-effect adjustment as of the date on which it is
first applied or by restating previously issued financial statements for one or
more years with a cumulative-effect adjustment as of the beginning of the first
year restated.


                                       15
<PAGE>

         In June 2003, the FASB issued an Exposure Draft for proposed SFAS
entitled "Qualifying Special Purpose Entities ("QSPE") and Isolation of
transferred Assets", an amendment of SFAS No. 140 ("The Exposure Draft"). The
Exposure Draft is a proposal that is subject to change and as such, is not yet
authoritative. If the proposal is enacted in its current form, it will amend and
clarify SFAS 140. The Exposure Draft would prohibit an entity from being a QSPE
if it enters into an agreement that obliged a transferor of financial assets,
its affiliates, or its agents to deliver additional cash or other assets to
fulfill the special-purposes entity's obligation to beneficial interest holders.

         In May 2003, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards ("SFAS") No. 150, "Accounting For
Certain Financial Instruments with Characteristics of both Liabilities and
Equity". SFAS No. 150 changes the accounting for certain financial instruments
with characteristics of both liabilities and equity that, under previous
pronouncements, issuers could account for as equity. The new accounting guidance
contained in SFAS No. 150 requires that those instruments be classified as
liabilities in the balance sheet.

         SFAS No. 150 affects the issuer's accounting for three types of
freestanding financial instruments. One type is mandatorily redeemable shares,
which the issuing company is obligated to buy back in exchange for cash or other
assets. A second type includes put options and forward purchase contracts, which
involves instruments that do or may require the issuer to buy back some of its
shares in exchange for cash or other assets. The third type of instruments that
are liabilities under this Statement is obligations that can be settled with
shares, the monetary value of which is fixed, tied solely or predominantly to a
variable such as a market index, or varies inversely with the value of the
issuers' shares. SFAS No. 150 does not apply to features embedded in a financial
instrument that is not a derivative in its entirety.

         Most of the provisions of Statement 150 are consistent with the
existing definition of liabilities in FASB Concepts Statement No. 6, "Elements
of Financial Statements". The remaining provisions of this Statement are
consistent with the FASB's proposal to revise that definition to encompass
certain obligations that a reporting entity can or must settle by issuing its
own shares. This Statement shall be effective for financial instruments entered
into or modified after May 31, 2003 and otherwise shall be effective at the
beginning of the first interim period beginning after June 15, 2003, except for
mandatorily redeemable financial instruments of a non-public entity, as to which
the effective date is for fiscal periods beginning after December 15, 2003.

         We do not expect the adoption of these pronouncements to have a
material impact on our consolidated financial position or results of operations.

TWELVE MONTHS ENDED FEBRUARY 28, 2003 COMPARED TO TWELVE MONTHS ENDED FEBRUARY
28, 2002.

         Net revenue for the twelve months ended February 28, 2003 was $82,935
and primarily consisted of sales of X-Men products, Lord of the Ring products
Marvel Character products and e-Bay Internet sales. Net revenue for the twelve
months ended February 28, 2002 was $407,106 and primarily consisted of sales of
X-Men products, Lord of the Ring products and Austin Powers products.

         Cost of sales for the twelve months ended February 28, 2003 decreased
by $388,451 from the twelve months ended February 28, 2002. This decrease was
mainly attributable to the decrease in volume of sales for the Lord of the Rings
products and Austin Powers. Cost of sales as a percentage of revenues decreased
to 61.1% for the twelve months ended February 28, 2003 as compared to 107.9% for
the same period last year. This decrease was mainly attributable to a charge of
$143,732 to cost of sales related to the write down of inventory for fiscal
2002.

         Selling, general and administrative expenses for the twelve months
ended February 28, 2003 decreased to $1,326,224 from $2,227,598 for the same
period the previous year. For the twelve months ended February 28, 2003 and
February 28, 2002 the services obtained through the issuance of stock included
internal accounting and financial services, internet website creation, marketing
assistance, insurance program review and general management consulting services
in the amount of $689,019 and $1,548,773 respectively. As previously mentioned,


                                       16
<PAGE>

we incur charges to bring the product to market. These charges relate to the
costs of producing samples as well as the related package design costs that must
be approved by the licensor prior to full production runs of the product. For
the twelve months ended February 28, 2003, we incurred charges relating to the
costs of producing the samples as well as the related package design of $14,261
versus charges of $12,902 for the same period the previous year.

         We incurred interest expense of $226,081 for the twelve months ended
February 28, 2003 as compared to $103,891 for the same period the previous year
due to increased borrowings and the beneficial conversion calculation related to
the application of the Emerging Issues Task Force Bulletin for accounting of
convertible securities and notes and loans payable with beneficial conversion
features. The beneficial conversion calculation added $137,500 and $0 of
interest expense respectively for the twelve months ended February 28, 2003 and
2002, respectively.

         As a result of the above, we had a net loss of $1,701,135 for the
twelve months ended February 28, 2003 as compared to a net loss of $3,837,951
for the same period last year.

LIQUIDITY AND CAPITAL RESOURCES

         As of February 28, 2003, we had a working capital deficiency of
$4,569,109. The working capital deficit as of February 28, 2003 is a direct
result of the unprofitable operations for prior years as well as for the past
twelve months ended February 28, 2003 that resulted in cash used in operating
activities of $364,367. We had an ending cash balance of $6,600 at February 28,
2003. As such, the Company will have to raise additional capital within the next
twelve months.

         We have financed our losses through private sales of equity and debt
securities and the issuance of stock for services. During the twelve months
ended February 28, 2003, we received the following capital infusions: $41,000
from issuance of common stock and $384,446 from other borrowings. Additionally,
during this period, we received notices requesting conversion from the holders
of demand notes and convertible debentures of $260,620. These instruments were
converted into 18,457,365 shares of common stock. During the twelve months ended
February 28, 2003, we made payments of $54,618 towards notes and loans payable.

         As of February 28, 2003, we had $857,674 in outstanding notes and loans
payable, (of which $97,045 is due to related parties) $71,800 in convertible
subordinated debentures and $692,700 in outstanding convertible secured
debentures. As of February 28, 2003, we had $1,352,189 in accounts payable and
$1,637,564 in accrued expenses, accrued payroll, accrued royalties and related
taxes (These liabilities are for federal withholding taxes and are related to
calendar years 1999, 2000 and 2001. We are currently making payments on our
current federal payroll tax obligations as well as monthly payments for these
prior obligations). We have been able to operate based on deferring vendor and
employee payments, deferring interest and debt repayments and obtaining
additional borrowings and proceeds from equity. However, there is no guarantee
that we will continue to be successful with respect to these actions.
Furthermore, there can be no assurances that we will be able to obtain the
necessary funding to finance their operations or grow revenue in sufficient
amounts to fund our operating expenses.

         Our independent auditors have issued a going concern paragraph in their
opinion on our consolidated financial statements that states there is
substantial doubt about our ability to continue as a going concern. Our ability
to continue as a going concern is dependent on our ability to raise additional
convertible debt, equity capital and access capital through debt and equity
funding as well as market and sell our various products.

         An event of default has occurred regarding the $400,000 convertible
secured debenture in that we did not have an effective registration statement
within 150 days of the debenture sale. As a result of this default, we are
obligated to pay the debenture holders the principal amount of the debentures
together with interest and certain other amounts. We do not have the capital
resources to pay the amounts required under this agreement. The secured
convertible debenture holders have informed us that they do not intend to take
any action at this time due to the default. We do not, however, have any legally
binding commitment from the debenture holders to waive the default provision of
the debenture. Subsequent to February 28, 2003, the convertible secured
debenture holders converted $45,485 of this debt into 59,029,491 shares of our
common stock.


                                       17
<PAGE>

         On May 28, 2002, we issued $75,000 in convertible debentures. The
debentures have a 12% coupon and matured July 28, 2002. Conversions to common
stock are at a 50% discount from the lowest bid price over the 30 days preceding
conversion. The debentures remain in default.

         On November 26, 2002 we issued $250,000 in convertible debentures. The
debentures have a 15% coupon and matures one year from date of issuance.
Conversions to common stock are at the lesser of $ .01 or 75% discount from the
lowest bid price over the 3 days during the 20 days preceding conversion.

         Subsequent to February 28, 2003, we issued $300,000 in convertible
debentures. The debentures have a 15% coupon and mature one year from date of
issuance. Conversions to common stock are at the lesser of $ .01 or 75% discount
from the lowest bid price over the 3 days during the 20 days preceding
conversion.

         Subsequent to February 28, 2002, at various times we have sold shares
of common stock to current shareholders, we have received $17,000 from the
issuance of these shares.

         On May 7, 2002, we filed an S-8 registration with the Securities and
Exchange Commission for 182,500,000 shares (pre-split basis).

         In December 2001, the Company increased its authorized shares to
700,000,000 from 350,000,000.

         May 7, 2002 we filed a schedule 14 with the Securities and Exchange
Commission to effect a 1 to 70 reverse stock split. The split went into effect
July 8, 2002. We believe that the reverse stock split will make it easier for us
to raise equity capital in the future.

         In December 2003, the Company and an employee entered into a five-year
Employment Agreement under which the employee is to receive a weekly salary of
$500. Additionally, 20,000,000 stock options are to be granted at exercise
prices ranging from $.001 to $.004 per share. The options have a ten-year term.
An additional 3,200,000 shares of our common stock are to be issued on or before
the termination of the employment agreement. Compensation afforded to the
employee under the agreement will also satisfy any and all our indebtedness to
the employee and related parties. The amount of this debt is estimated to be
$219,530.

         In November 2002, we successfully negotiated a long-term payment plan
with the IRS to retire our outstanding payroll tax obligations. The plan was
executed in December 2002 and calls for escalating monthly payments to be made
over a period of 18 months. After an initial down payment of $25,800 in December
2002, we have agreed to a payment schedule of $5,750 for the first six months,
$13,000 for the next six months and $25,000 for the final six months. We made
the agreed payments in a timely fashion through the first six months and are
currently behind schedule on the balance. We are negotiating with the IRS to
recast the plan in accordance with our ability to make timely payments.


                                       18
<PAGE>

ITEM 7. FINANCIAL STATEMENTS.

                        COLLECTIBLE CONCEPTS GROUP, INC.
                                AND SUBSIDIARIES

                        CONSOLIDATED FINANCIAL STATEMENTS
                             AS OF FEBRUARY 28, 2003

                                    CONTENTS

PAGE     F-1       INDEPENDENT AUDITORS' REPORT

PAGE     F-2       CONSOLIDATED BALANCE SHEET AS OF FEBRUARY 28, 2003

PAGE     F-3       CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE YEARS ENDED
                   FEBRUARY 28, 2003 AND 2002

PAGE     F-4       CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' DEFICIENCY
                   FOR THE YEARS ENDED FEBRUARY 28, 2003 AND 2002

PAGE     F-5       CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED
                   FEBRUARY 28, 2003 AND 2002

PAGES  F-6 - F-21  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF FEBRUARY 28,
                   2003


                                       19
<PAGE>

                          INDEPENDENT AUDITORS' REPORT


To the Board of Directors of:
  Collectible Concepts Group, Inc. and Subsidiaries

We have audited the accompanying consolidated balance sheet of Collectible
Concepts Group, Inc. and Subsidiaries (the "Company"), as of February 28, 2003
and the related consolidated statements of operations, changes in shareholders'
deficiency and cash flows for the years ended February 28, 2003 and 2002. 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 the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audits to obtain reasonable assurance about whether the
consolidated financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the consolidated 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 Collectible Concepts
Group, Inc. and Subsidiaries as of February 28, 2003, and the results of their
operations and their cash flows for the years ended February 28, 2003 and 2002,
in conformity 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 to the
consolidated financial statements, the Company's working capital deficiency of
$4,569,109, shareholders' deficiency of $4,536,128, net loss from operations of
$1,701,135 and net cash used in operations of $364,367 raise substantial doubt
about its ability to continue as a going concern. Management's plan in regards
to these matters is also described in Note 2. These consolidated financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.

WEINBERG & COMPANY, P.A.


Boca Raton, Florida
October 22, 2003, except for Note 15 as to which the date is March 16, 2004


                                      F-1
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEET
                             AS OF FEBRUARY 28, 2003


                                     ASSETS
CURRENT ASSETS
 Cash                                                              $      6,600
 Accounts receivable, net                                                 3,511
 Inventories                                                             23,270
                                                                   ------------
     Total Current Assets                                                33,381
                                                                   ------------

PROPERTY AND EQUIPMENT, NET                                              37,918
                                                                   ------------

OTHER ASSETS
 Trademarks                                                               1,300
 Security deposits                                                        3,200
                                                                   ------------
     Total Other Assets                                                   4,500
                                                                   ------------

TOTAL ASSETS                                                       $     75,799
                                                                   ============

                    LIABILITIES AND SHAREHOLDERS' DEFICIENCY

CURRENT LIABILITIES
 Convertible secured debentures, net                               $    692,700
 Notes and loans payable, current portion                               751,192
 Notes payable - related parties                                         97,045
 Convertible subordinated debentures                                     71,800
 Accounts payable                                                     1,352,189
 Accrued expenses                                                     1,637,564
                                                                   ------------
     Total Current Liabilities                                        4,602,490

Notes and loans payable, long-term portion                                9,437
                                                                   ------------

TOTAL LIABILITIES                                                     4,611,927
                                                                   ------------

COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS' DEFICIENCY
 Common stock, $.001 par value, 700,000,000 shares authorized,
  99,400,121 shares issued and outstanding                               99,400
 Common stock to be issued (1,524,506 shares)                            10,374
 Additional paid-in capital                                          14,396,576
 Deferred equity-based expenses                                        (187,500)
 Accumulated deficit                                                (18,854,978)
                                                                   ------------
     Total Shareholders' Deficiency                                  (4,536,128)
                                                                   ------------

TOTAL LIABILITIES AND SHAREHOLDERS' DEFICIENCY                     $     75,799
                                                                   ============

          See accompanying notes to consolidated financial statements.


                                      F-2
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                 FOR THE YEARS ENDED FEBRUARY 28, 2003 AND 2002


                                                      2003              2002
                                                  ------------     ------------

SALES                                             $     82,935     $    407,106

COST OF SALES                                           50,687          439,138
                                                  ------------     ------------

GROSS PROFIT (LOSS)                                     32,248          (32,032)
                                                  ------------     ------------
OPERATING EXPENSES
 Selling, general and administrative                 1,326,224        2,227,598
                                                  ------------     ------------
       Total Operating Expenses                      1,326,224        2,227,598
                                                  ------------     ------------

LOSS FROM OPERATIONS                                (1,293,976)      (2,259,630)
                                                  ------------     ------------
OTHER EXPENSE
 Interest expense                                     (226,081)        (103,891)
 Loss on settlement of debt and interest              (181,078)         (83,858)
                                                  ------------     ------------
       Total Other Expense                            (407,159)        (187,749)
                                                  ------------     ------------

LOSS BEFORE TAX PROVISION                           (1,701,135)      (2,447,379)
INCOME TAX PROVISION                                        --               --
                                                  ------------     ------------
LOSS FROM CONTINUING OPERATIONS                     (1,701,135)      (2,447,379)
LOSS FROM DISCONTINUED OPERATIONS                           --       (1,390,572)
                                                  ------------     ------------

NET LOSS                                          $ (1,701,135)    $ (3,837,951)
                                                  ============     ============

BASIC AND DILUTED LOSS PER SHARE
 Loss per share from continuing operations        $      (0.04)    $      (0.53)
 Loss per share from discontinued operations                --            (0.31)
                                                  ------------     ------------

       Basic and Diluted Loss Per Share           $      (0.04)    $      (0.84)
                                                  ============     ============

WEIGHTED AVERAGE SHARES USED IN NET LOSS
 CALCULATIONS - BASIC AND DILUTED                   39,426,896        4,595,557
                                                  ============     ============


          See accompanying notes to consolidated financial statements.


                                      F-3
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
               CONSOLIDATED STATEMENTS OF SHAREHOLDERS' DEFICIENCY
                 FOR THE YEARS ENDED FEBRUARY 28, 2003 AND 2002

<TABLE>
<CAPTION>
                                                                                          Common Stock            Additional
                                                           Common Stock                   To Be Issued              Paid-In
                                                      Shares            Amount         Shares         Amount        Capital
                                                   ------------    ------------    ------------   ------------   ------------
<S>                                                  <C>           <C>                <C>         <C>            <C>
Balance, February 28, 2001                            3,713,365    $      3,713              --   $         --   $ 11,340,834
Common stock issued for cash                            155,714             156              --             --        108,844
Common stock issued for services rendered             3,440,965           3,441              --             --      1,545,332
Common stock to be issued per anti-dilution
 provision                                                   --              --          49,624             50            (50)
Conversion of convertible subordinated
 debentures, notes and loans payable,
 convertible secured debentures and related
 interest to common stock                               156,390             156              --             --        188,235
Amortization of deferred equity-based expense                --              --              --             --             --
Decrease due to fractional shares as a result of
 1 for 70 reverse stock split                           (73,820)            (74)             --             --             74
Net loss, fiscal 2002                                        --              --              --             --             --
                                                   ------------    ------------    ------------   ------------   ------------
Balance, February 28, 2002                            7,392,614           7,392          49,624             50     13,183,269
Common stock issued for cash                         31,428,572          31,429              --             --          9,571
Common stock issued for services                     42,121,570          42,122              --             --        646,897
Common stock to be issued per anti-dilution
 provision                                                   --              --       1,474,882         10,324        (10,324)
Beneficial conversion on convertible debentures              --              --              --             --        325,000

Conversion of convertible subordinated
 debentures, notes and loans payable,
 convertible secured debentures and related
 interest to common stock                            18,457,365          18,457              --             --        242,163

Net loss, fiscal 2003                                        --              --              --             --             --
                                                   ------------    ------------    ------------   ------------   ------------
BALANCE, FEBRUARY 28, 2003                           99,400,121    $     99,400       1,524,506   $     10,374   $ 14,396,576
                                                   ============    ============    ============   ============   ============
</TABLE>

<TABLE>
<CAPTION>
                                                     Deferred
                                                   Equity-Based    Accumulated
                                                     Expenses         Deficit         Total
                                                   ------------    ------------    ------------
<S>                                                <C>             <C>             <C>
Balance, February 28, 2001                         $    (14,000)   $(13,315,892)   $ (1,985,345)
Common stock issued for cash                                 --              --         109,000
Common stock issued for services rendered                    --              --       1,548,773
Common stock to be issued per anti-dilution
 provision                                                   --              --              --
Conversion of convertible subordinated
 debentures, notes and loans payable,
 convertible secured debentures and related
 interest to common stock                                    --              --         188,391
Amortization of deferred equity-based expense            14,000              --          14,000
Decrease due to fractional shares as a result of
 1 for 70 reverse stock split                                --              --              --
Net loss, fiscal 2002                                        --      (3,837,951)     (3,837,951)
                                                   ------------    ------------    ------------
Balance, February 28, 2002                                   --     (17,153,843)     (3,963,132)
Common stock issued for cash                                 --              --          41,000
Common stock issued for services                             --              --         689,019
Common stock to be issued per anti-dilution
 provision                                                   --              --              --
Beneficial conversion on convertible debentures        (187,500)             --         137,500

Conversion of convertible subordinated
 debentures, notes and loans payable,
 convertible secured debentures and related
 interest to common stock                                    --              --         260,620

Net loss, fiscal 2003                                        --      (1,701,135)     (1,701,135)
                                                   ------------    ------------    ------------
BALANCE, FEBRUARY 28, 2003                         $   (187,500)   $(18,854,978)   $ (4,536,128)
                                                   ============    ============    ============
</TABLE>

          See accompanying notes to consolidated financial statements.


                                      F-4
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                 FOR THE YEARS ENDED FEBRUARY 28, 2003 AND 2002

<TABLE>
<CAPTION>
                                                                                     2003            2002
                                                                                 -----------     -----------
<S>                                                                              <C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net loss                                                                        $(1,701,135)    $(3,837,951)
 Loss from discontinued operations                                                        --       1,390,572
                                                                                 -----------     -----------
 Loss from continuing operations                                                  (1,701,135)     (2,447,379)
 Adjustments to reconcile net loss to net cash used in operating activities:
   Depreciation                                                                       23,723          25,984
  Amortization of debt discount and interest                                              --          47,351
  Amortization of deferred equity-based expenses                                     137,500          14,000
  Provision for doubtful accounts                                                         --          15,301
  Write-down of inventory                                                                 --         143,732
  Common stock issued for services rendered                                          689,019       1,548,773
  Loss on settlement of debt and interest                                            181,078          83,858
 Changes in operating assets and liabilities, net of discontinued operations:
  Accounts receivable                                                                 38,309         (15,526)
  Inventories                                                                        (12,705)        220,502
  Prepaid royalties                                                                       --          98,051
  Prepaid expenses and other                                                              --           8,970
  Other assets                                                                            --          (3,200)
  Accounts payable and accrued expenses                                              279,844         642,060
                                                                                 -----------     -----------
         Net Cash (Used In) Provided By Continuing Operations                       (364,367)        382,477
         Net Cash Used In Discontinued Operations                                         --        (892,870)
                                                                                 -----------     -----------
         Net Cash Used In Operating Activities                                      (364,367)       (510,393)
                                                                                 -----------     -----------

CASH FLOWS FROM INVESTING ACTIVITIES:
 Purchases of property and equipment                                                      --         (15,202)
                                                                                 -----------     -----------
         Net Cash Used In Investing Activities                                            --         (15,202)
                                                                                 -----------     -----------

CASH FLOWS FROM FINANCING ACTIVITIES:
 Proceeds from issuance of common stock                                               41,000         109,000
 Repayment of notes and loans payable                                                (14,970)         (2,588)
 Proceeds from notes and loans payable                                                10,000         399,679
 Repayment of notes payable - related parties                                        (39,648)       (187,173)
 Proceeds from notes payable - related parties                                        49,446         206,594
 Proceeds from convertible secured debentures                                        325,000              --
                                                                                 -----------     -----------
         Net Cash Provided by Financing Activities                                   370,828         525,512
                                                                                 -----------     -----------

NET INCREASE (DECREASE) IN CASH                                                        6,461             (83)

CASH - BEGINNING OF YEAR                                                                 139             222
                                                                                 -----------     -----------

CASH - END OF YEAR                                                               $     6,600     $       139
                                                                                 ===========     ===========
</TABLE>


          See accompanying notes to consolidated financial statements.


                                      F-5
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             AS OF FEBRUARY 28, 2003


NOTE 1   NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

      (A) DESCRIPTION OF BUSINESS

      Collectible Concepts Group, Inc. and its subsidiaries (the "Company")
      distribute high-end and novelty products related to both the entertainment
      and sports industries. The Company sells its products through retailers,
      distributors, department stores, the Internet and catalogers.

      (B) PRINCIPLES OF CONSOLIDATION

      The accompanying consolidated financial statements include the accounts of
      Collectible Concepts Group, Inc. and its two wholly owned subsidiaries,
      Team Sports Specialties Corporation and Music Art Corporation. All
      significant intercompany accounts and transactions have been eliminated.

      The Company discontinued operations of its two wholly owned subsidiaries,
      Team Sports Specialties Corporation and Music Art Corporation during the
      fiscal year ended February 28, 2002 (See Note 3).

      (C) USE OF ESTIMATES

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

      (D) REVENUE RECOGNITION

      Revenue from the sale of products is recognized when persuasive evidence
      of an arrangement exists, delivery has occurred, the price has been
      determined and collectability is reasonably assured. The Company records
      an allowance for estimated returns, as required.

      (E) CASH

      Cash consists of cash held on deposit at financial institutions. These
      balances are insured by the Federal Deposit Insurance Corporation up to
      $100,000 at each institution.


                                      F-6
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             AS OF FEBRUARY 28, 2003


      (F) ACCOUNTS RECEIVABLE

      The Company's trade accounts are unsecured with an allowance for
      uncollectible accounts provided for those amounts of which collectability
      is uncertain. The allowance for doubtful accounts was $2,740 as of
      February 28, 2003.

      (G) INVENTORIES

      Merchandise inventories are valued at lower of cost or market on the first
      in, first out (FIFO) method. The Company recorded a write-down expense for
      obsolete inventories of $0 and $143,732 for the years ended February 28,
      2003 and 2002, respectively.

      (H) PROPERTY AND EQUIPMENT

      Property and equipment consists principally of office and computer
      equipment and is recorded at cost less accumulated depreciation. Upon sale
      or retirement, the cost of the asset and the related accumulated
      depreciation are removed from the accounts and the resultant gain or loss,
      if any, is included in the statement of operations. Depreciation is
      computed using the straight-line method based on the estimated useful
      lives of the related assets, principally five to seven years.

      (I) LONG-LIVED ASSETS

      The Company reviews long-lived assets for impairment under Statement of
      Financial Accounting Standards No. 144, "Accounting for the Impairment or
      Disposal of Long-Lived Assets." Long-lived assets to be held and used are
      reviewed for impairment whenever events or changes in circumstances
      indicate that the carrying amount of an asset may not be recoverable. The
      carrying amount of a long-lived asset is not recoverable if it exceeds the
      sum of the undiscounted cash flows expected to result from the use and
      eventual disposition of the asset. Long-lived assets to be disposed of are
      reported at the lower of carrying amount or fair value less cost to sell.

      (J) LOSS PER SHARE

      The Company follows Statement of Financial Accounting Standards No. 128
      ("SFAS No. 128") "Earnings Per Share". Basic and fully diluted loss per
      share amounts are computed based on net loss and divided by the weighted
      average number of common shares outstanding. The assumed conversion of
      convertible debt into 138,595,714 common shares in 2003 and 213,877 common
      shares in 2002 and the exercise of outstanding options and warrants to
      purchase 165,723 common shares in 2003 and 2002 were not included in the
      computation of diluted loss per because the assumed conversion and
      exercise would be anit-dilutive for all periods presented.


                                      F-7
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             AS OF FEBRUARY 28, 2003


      (K) ADVERTISING EXPENSE

      The Company participates in various advertising programs. All costs
      related to advertising are expensed in the period incurred. Advertising
      expense amounted to approximately $4,000 and $30,000 for the fiscal years
      ended February 28, 2003 and 2002, respectively.

      (L) FAIR VALUE OF FINANCIAL INSTRUMENTS

      Carrying amounts of financial instruments held by the Company, which
      includes cash, accounts receivable, accounts payable and accrued royalties
      and expenses, convertible secured debentures, notes and loans payable and
      convertible subordinated debentures approximate fair value due to the
      short-term maturities of these assets and liabilities. Long-term debt
      approximates fair value based upon debt terms available for entities under
      similar terms.

      (M) INCOME TAXES

      Deferred taxes are accounted for in accordance with SFAS No. 109
      "Accounting for Income Taxes." The Statement requires an asset and
      liability approach for financial accounting and reporting for income
      taxes. Deferred income taxes are provided for the difference between the
      tax basis of an asset or liability and its reported amount in the
      financial statements using enacted tax rates that are expected to be in
      effect for the year in which the differences are expected to reverse.
      Deferred income taxes arise principally from differences between financial
      and income tax reporting, including amounts recorded for inventory, the
      allowance for doubtful accounts, accrued expenses, the availability of net
      operating loss carryforwards and certain other temporary differences.
      Deferred income tax assets are reduced by a valuation allowance when,
      based on the weight of evidence available, it is more likely than not that
      some portion or all of the deferred tax assets will not be realized. The
      determination of the requirement for a valuation allowance is an estimate,
      which is reasonably possible to change in the near term.

      (N) RECENT ACCOUNTING PRONOUNCEMENTS

      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." SFAS No. 145 rescinds the provisions of SFAS No.
      4, which requires companies to classify certain gains and losses from debt
      extinguishments as extraordinary items, eliminates the provisions of SFAS
      No. 44 regarding transition to the Motor Carrier Act of 1980 and amends
      the provisions of SFAS No. 13 to require that certain lease modifications
      be treated as sale leaseback transactions. The provisions of SFAS No. 145
      related to classification of debt extinguishments are effective for fiscal
      years beginning after May 15, 2002, with earlier application encouraged.


                                      F-8
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             AS OF FEBRUARY 28, 2003


      In July 2002, the FASB issued SFAS No. 146, "Accounting for Restructuring
      Costs." SFAS No. 146 applies to costs associated with an exit activity
      (including restructuring) or with a disposal of long-lived assets. Those
      activities can include eliminating or reducing product lines, terminating
      employees and contracts and relocating plant facilities or personnel.
      Under SFAS No. 146, the Company will record a liability for a cost
      associated with an exit or disposal activity when that liability is
      incurred and can be measured at fair value. SFAS No. 146 will require the
      Company to disclose information about its exit and disposal activities,
      the related costs, and changes in those costs in the notes to the interim
      and annual financial statements that include the period in which an exit
      activity is initiated and in any subsequent period until the activity is
      completed. SFAS No. 146 is effective prospectively for exit or disposal
      activities initiated after December 31, 2002, with earlier adoption
      encouraged. Under SFAS No. 146, a company cannot restate it's previously
      issued financial statements and the new statement grandfathers the
      accounting for liabilities that a company had previously recorded under
      Emerging Issues Task Force Issue 94-3.

      In December 2002, the FASB issued SFAS No. 148, "Accounting for
      Stock-Based Compensation-Transition and Disclosure - an amendment of FASB
      Statement No. 123." SFAS No. 148 amends SFAS No. 123, "Accounting for
      Stock Based Compensation" and provides alternative methods for accounting
      for a change by registrants to the fair value method of accounting for
      stock-based compensation. Additionally, SFAS No. 148 amends the disclosure
      requirements of SFAS No. 123 to require disclosure in the significant
      accounting policy footnote of both annual and interim financial statements
      of the method of accounting for stock based-compensation and the related
      pro-forma disclosures when the intrinsic value method continues to be
      used. The statement is effective for fiscal years beginning after December
      15, 2002, and disclosures are effective for the first fiscal quarter
      beginning after December 15, 2002.

      In January 2003, The FASB issued Interpretation No. 46, "Consolidation of
      Variable Interest Entities", an interpretation of Accounting Research
      Bulletin ("ARB") No. 51, "Consolidated Financial Statements".
      Interpretation No. 46 addresses consolidation by business enterprises of
      variable interest entities, which have one or both of the following
      characteristics: (i) the equity investment at risk is not sufficient to
      permit the entity to finance its activities without additional
      subordinated support from other parties, which is provided through other
      interest that will absorb some or all of the expected losses of the
      entity; (ii) the equity investors lack one or more of the following
      essential characteristics of a controlling financial interest: the direct
      or indirect ability to make decisions about the entities activities
      through voting rights or similar rights; or the obligation to absorb the
      expected losses of the entity if they occur, which makes it possible for
      the entity to finance its activities; the right to receive the expected
      residual returns of the entity if they occur, which is the compensation
      for the risk of absorbing the expected losses.


                                      F-9
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             AS OF FEBRUARY 28, 2003


      Interpretation No. 46 also requires expanded disclosures by the primary
      beneficiary (as defined) of a variable interest entity and by an
      enterprise that holds a significant variable interest in a variable
      interest entity but is not the primary beneficiary. Interpretation No. 46
      applies immediately to variable interest entities created after January
      31, 2003, and to variable interest entities in which an enterprise obtains
      an interest after that date. It applies in the first fiscal year or
      interim period beginning after June 15, 2003, to variable interest
      entities in which an enterprise holds a variable interest that it acquired
      before February 1, 2003. Interpretation No. 46 may be applied
      prospectively with a cumulative-effect adjustment as of the date on which
      it is first applied or by restating previously issued financial statements
      for one or more years with a cumulative-effect adjustment as of the
      beginning of the first year restated.

      In June 2003, the FASB issued an Exposure Draft for proposed SFAS entitled
      "Qualifying Special Purpose Entities ("QSPE") and Isolation of transferred
      Assets", an amendment of SFAS No. 140 ("The Exposure Draft"). The Exposure
      Draft is a proposal that is subject to change and as such, is not yet
      authoritative. If the proposal is enacted in its current form, it will
      amend and clarify SFAS 140. The Exposure Draft would prohibit an entity
      from being a QSPE if it enters into an agreement that obliged a transferor
      of financial assets, its affiliates, or its agents to deliver additional
      cash or other assets to fulfill the special-purposes entity's obligation
      to beneficial interest holders.

      In May 2003, the Financial Accounting Standards Board ("FASB") issued
      Statement of Financial Accounting Standards ("SFAS") No. 150, "Accounting
      For Certain Financial Instruments with Characteristics of both Liabilities
      and Equity". SFAS No. 150 changes the accounting for certain financial
      instruments with characteristics of both liabilities and equity that,
      under previous pronouncements, issuers could account for as equity. The
      new accounting guidance contained in SFAS No. 150 requires that those
      instruments be classified as liabilities in the balance sheet.

      SFAS No. 150 affects the issuer's accounting for three types of
      freestanding financial instruments. One type is mandatorily redeemable
      shares, which the issuing company is obligated to buy back in exchange for
      cash or other assets. A second type includes put options and forward
      purchase contracts, which involves instruments that do or may require the
      issuer to buy back some of its shares in exchange for cash or other
      assets. The third type of instruments that are liabilities under this
      Statement is obligations that can be settled with shares, the monetary
      value of which is fixed, tied solely or predominantly to a variable such
      as a market index, or varies inversely with the value of the issuers'
      shares. SFAS No. 150 does not apply to features embedded in a financial
      instrument that is not a derivative in its entirety.

      Most of the provisions of Statement 150 are consistent with the existing
      definition of liabilities in FASB Concepts Statement No. 6, "Elements of
      Financial Statements". The remaining provisions of this Statement are
      consistent with the FASB's proposal to revise that definition to encompass


                                      F-10
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             AS OF FEBRUARY 28, 2003


      certain obligations that a reporting entity can or must settle by issuing
      its own shares. This Statement shall be effective for financial
      instruments entered into or modified after May 31, 2003 and otherwise
      shall be effective at the beginning of the first interim period beginning
      after June 15, 2003, except for mandatorily redeemable financial
      instruments of a non-public entity, as to which the effective date is for
      fiscal periods beginning after December 15, 2003.

      Management does not expect the adoption of these pronouncements to have a
      material impact on the Company's consolidated financial position or
      results of operations.

NOTE 2   GOING CONCERN

      The Company's consolidated financial statements have been prepared in
      conformity with generally accepted accounting principles, which
      contemplates the continuation of the Company as a going concern. Since
      inception, the Company has not generated sufficient revenues to meet its
      operating expenses and has incurred significant operating losses and net
      losses. As of February 28, 2003, the Company had a working capital
      deficiency of $4,569,109, shareholders' deficiency of $4,536,128, net loss
      from operations of $1,701,135 and net cash used in operations of $364,367.
      The Company has minimal cash available for operations and is in default
      with respect to repayment provisions of certain secured and subordinated
      debentures. In addition, the Company was not able to complete an effective
      registration statement within 150 days as required in connection with the
      sale of convertible secured debentures to a group of investors and, as a
      result, the Company is in default of the debenture agreement. To generate
      additional revenues and the working capital needed to continue and expand
      operations, the Company has committed to a plan for reducing expenses,
      increasing retail distribution channels for its products and raising
      additional capital. There can be no assurances that the Company will be
      able to obtain the necessary funding to finance their operations or grow
      revenue in sufficient amounts to fund their operations.

      These matters raise substantial doubt about the Company's ability to
      continue as a going concern. The consolidated financial statements do not
      include any adjustments relating to the recoverability and classification
      of recorded assets, or the amounts and classification of liabilities that
      might be necessary in the event the Company cannot continue in existence.

NOTE 3   DISCONTINUED OEPRATIONS

      On June 5, 2000, the Company acquired 100% of the outstanding common
      shares of Music Art Corporation ("Music Art") for 14,929 shares of Company
      common stock. Music Art was primarily engaged in the business of creating,
      marketing and distributing limited edition lithographs derived from
      artwork used on music albums and other music collectibles. The acquisition
      was accounted for as a purchase. The shares of common stock issued to
      acquire Music Art were valued at $305,000, based upon the Company's
      guarantee of the fair market price of the Company's common stock one year


                                      F-11
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             AS OF FEBRUARY 28, 2003


      from the issuance date. The assets acquired consisted primarily of current
      assets, minimal fixed assets and no other identifiable intangible assets
      other than goodwill. The excess of acquisition cost over the fair value of
      net assets was approximately $377,000. As of February 28, 2002, all
      related goodwill associated with Music Art has been reclassified to
      discontinued operations.

      On August 2, 2000, a wholly owned subsidiary of the Company, Team Sport
      Specialties Corporation, purchased certain assets and liabilities of
      Rooter Rattle, L.P. in exchange for $965,000 of consideration, payable as
      $390,000 in cash, a $30,000 note payable and 51,904 shares of common stock
      issued at a value of $545,000 based upon the trading price of the
      Company's common stock on the acquisition date. The acquisition was
      accounted for as a purchase. The assets acquired consisted primarily of
      current assets, minimal fixed assets and no other identifiable intangible
      assets other than goodwill. The excess of acquisition cost over the fair
      value of net assets was approximately $1,050,000. As of February 28, 2002,
      all related goodwill associated with Rooter Rattle, L.P. has been
      reclassified to discontinued operations.

      The Company discontinued the operations of Music Art and Team Sports
      during the year ended February 28, 2002. The Company did not incur a gain
      or loss on the disposal of these subsidiaries since the Company
      unilaterally ceased operations of these subsidiaries and the assets and
      liabilities reverted back to the original owners as per the terms of the
      original acquisition agreements. The assets were comprised of accounts
      receivables, inventory, fixed assets and goodwill. The liabilities were
      comprised of accounts payable and accrued expenses. A loss of $0 and
      $1,390,572 was incurred from the discontinued operations of these
      subsidiaries for years ended February 28, 2003 and 2002, respectively.

NOTE 4   PROPERTY AND EQUIPMENT

      As of February 28, 2003, property and equipment consisted of the
      following:

      Computer and Office Equipment                                 $   126,179
      Accumulated Depreciation                                          (88,261)
                                                                    -----------
      Property and Equipment, net                                   $    37,918
                                                                    ===========

      Depreciation expense amounted to $23,723 and $25,984 for the years ended
      February 28, 2003 and 2002, respectively.

NOTE 5   ACCRUED EXPENSES

      As of February 28, 2003, accrued expenses consisted of the following:

      Accrued interest, of which $82,228 is due to related party    $   310,215
      Accrued payroll                                                   645,051
      Accrued royalties                                                 356,250
      Other miscellaneous accrued expenses                              326,048
                                                                    -----------
      Accrued Expenses                                              $ 1,637,564
                                                                    ===========


                                      F-12
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             AS OF FEBRUARY 28, 2003


NOTE 6   CONVERTIBLE SECURED DEBENTURES

      On November 26, 2002, the Company issued $250,000 of convertible secured
      debentures to a group of investors. These debentures mature on November
      26, 2003 and bear interest at 15% per annum and are convertible into
      shares of the Company's common stock at the lower of $.01 or 25% of the
      average of the lowest three intraday trading prices during the twenty
      trading days immediately preceding conversion. This results in a
      beneficial conversion feature in the amount of $250,000, (since it is
      limited to the amount received) which is being amortized over the term of
      the loan. As of February 28, 2003, the Company has recognized interest
      expense of $62,500 and has deferred $187,500.

      On May 28, 2002, the Company issued a $75,000 convertible secured
      debentures to a group of investors with a conversion price of 50% of the
      average of the lowest three intraday trading prices during the twenty days
      immediately preceding conversion. This resulted in a beneficial conversion
      feature of $75,000, which has been fully expensed during the year ended
      February 28, 2003. The debentures bear interest of 12% simple interest per
      annum and matured on July 28, 2003. The debentures are convertible into
      shares of the Company's common stock at any time at the holder's option
      equal to the quotient of (a) the aggregate amount of the principle and
      accrued interest to be so converted by (b) the conversion price. As of the
      date of this report, these debentures are still unpaid in total and are in
      default.

      In May 2000, the Company issued $400,000 of secured convertible debentures
      to a group of investors. These debentures matured in April 2001, are
      secured by substantially all of the Company's assets and bear interest at
      10% per annum, payable quarterly; the debentures are convertible into
      common stock at any time at the holder's option at the lesser of $2.80
      (adjusted for 1 for 70 split) per share or 50% of market value (the debt
      discount of $65,000 assigned to this beneficial conversion feature was
      recorded as additional paid-in capital and the debt discount was amortized
      as interest expense in the quarter ended May 31, 2000 because the
      debentures are convertible at any time at holder's option); the debentures
      also have warrants to purchase 57,143 shares of common stock at 110% of
      the market value on the closing date - the warrants have a five-year life
      and are exercisable immediately (using an option pricing model, the
      warrants were valued at $280,000 using the following assumptions: no
      expected payment of dividends, expected lives of warrants of three years,
      a risk free rate of 6.5% and a volatility of 75%). The $280,000 was
      recorded as additional paid-in capital and the debt discount was amortized
      to interest expense over the term of the related debentures. As of
      February 28, 2002, the debt discount had been fully amortized with the
      Company recognizing interest of $0 and $46,667 during the years ended


                                      F-13
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             AS OF FEBRUARY 28, 2003


      February 28, 2003 and 2002, respectively. During the years ended February
      28, 2003 and 2002, the debenture holders converted convertible secured
      debentures in the amount of $19,800 and $12,500 into 12,783,009 and 35,714
      common shares, respectively, based upon stated conversion prices or
      negotiated conversion prices. Due to these conversions, the Company
      incurred a loss of $209,076 and $15,000 during the years ended February
      28, 2003 and 2002, respectively, as the negotiated converted prices were
      less than the fair market value of the Company's common stock on the date
      of the conversions (See Note 14). The debenture holders also have certain
      rights in the event the Company files a registration statement. The
      Company was not able to complete an effective registration statement
      within 150 days of the debenture sale. As a result, the Company is in
      default of the debenture agreement. As of the date of this report, the
      remaining debentures are still unpaid and in default.

NOTE 7   NOTES AND LOANS PAYABLE

      As of February 28, 2003, notes and loans payable consisted of various
      unsecured notes and loans payable to certain individuals, investors and an
      auto finance company. The notes and loans bear interest at various rates
      ranging from 8.0% to 12.0% and had various maturities through August 2001,
      except for the automobile loan, which matures February 28, 2006. The
      balance of the notes and loans payable are in default and remain unpaid in
      total as of the date of this report. During the year ended February 28,
      2003 and 2002, the note and loan holders converted notes and loans payable
      in the amount of $25,000 and $36,000 and accrued interest of $1,500 and
      $16,000 into 5,009,524 and 63,215 common shares based upon stated
      conversion prices or negotiated conversion prices. Due to these
      conversions, the Company realized a gain of $1,405, for the year ended
      February 28, 2003 and a loss of $49,350 for the year ended February 28,
      2002, as the negotiated converted price was more than the fair market
      value of the Company's common stock on the date of the conversion for the
      year ended February 28, 2003 and less than the fair market value of the
      Company's common stock on the date of the conversion for the year ended
      February 28, 2002 (See Note 14).

      The Company has a note payable of approximately $97,000, which is included
      in notes payable - related parties in the accompanying consolidated
      balance sheet, due to the Company's president and related parties as of
      February 28, 2003. During the years ended February 28, 2003 and 2002, the
      Company recorded interest expense of approximately $5,000 each year
      relating to loans from its president and related parties and approximately
      $82,000 in accrued interest was payable relating to these loans as of
      February 28, 2003, which is recorded in accrued expenses in the
      accompanying consolidated balance sheet.

NOTE 8   CONVERTIBLE SUBORDINATED DEBENTURES

      The Company has outstanding $71,800 of convertible subordinated debentures
      as of February 28, 2003. The debentures bear interest at rates ranging


                                      F-14
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             AS OF FEBRUARY 28, 2003


      from 10% to 12% per annum and matured at various times through August
      2001. During the year ended February 28, 2003, the debenture holders
      converted convertible subordinated debentures in the amount of $25,000 and
      $40,000 and accrued interest of $8,241 and $0 into 664,832 and 57,461
      common shares based upon stated conversion prices or negotiated conversion
      prices. Due to these conversions, the Company realized a gain of $26,593,
      for the year ended February 28, 2003 and a loss of $19,508 for the year
      ended February 28, 2002as the negotiated converted prices were more than
      the fair market value of the Company's common stock on the date of the
      conversion for the year ended February 28, 2003 and less than the fair
      market value of the Company's common stock on the date of the conversion
      for the year ended February 28, 2002 (See Note 14). The remaining
      debentures are in default and remain unpaid as of the date of this report.
      Each $1,000 unit is convertible at any time at the holder's option, into
      between 143 and 1,429 shares of the Company's common stock for an
      aggregate of 55,714 common shares.

NOTE 9   COMMON STOCK

      In July 2002, the Company authorized a 1 for 70 reverse stock split. As a
      result of the reverse stock split, all capital stock shares and amounts
      and per share data have been retroactively restated.

      During the fiscal year ended February 28, 2003, the Company received
      $41,000 from the issuance of 31,428,572 shares of common stock through
      private placements to various investors.

      During the fiscal year ended February 28, 2003, the debenture holders
      converted $79,541 of convertible secured and subordinated debentures,
      notes and loans payable and related accrued interest into 18,457,365
      shares of common stock having a fair value of $260,620. The conversions of
      debt to stock were based upon negotiated conversion prices with the
      debtors (See Note 14).

      In October 2001, the Company entered into an agreement with a third party
      whereby the third party has an anti-dilution of 1.603%. The Company has
      not issued the respective shares of 1,474,882 and 49,624 for the years
      ended February 28, 2003 and 2002, respectively, to the third party. These
      shares are recorded as common stock to be issued with a corresponding
      decrease to additional paid in capital.

      During the fiscal year ended February 28, 2002, debenture holders
      converted $104,533 of convertible secured and subordinated debentures,
      notes and loans payable and related accrued interest into 156,390 shares
      of common stock having a fair value of $188,391. The conversions of debt
      to stock were based upon negotiated conversion prices with the debtors
      (See Note 14).


                                      F-15
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             AS OF FEBRUARY 28, 2003


      From time to time, the Company has issued common stock in exchange for the
      performance of services or as an alternative to the payment of interest on
      outstanding debt, internal accounting and financial services, internet
      website creation, marketing, insurance program review and general
      management consulting. The amount of these activities included in the
      selling, general and administrative expenses was $689,019 and $1,548,773
      for the years ended February 28, 2003 and February 28, 2002, respectively.
      These transactions have been recorded at the fair value of the services
      rendered or the fair value of the common stock issued, whichever was more
      readily evident. The number of shares of common stock issued for services
      performed in fiscal 2003 and fiscal 2002 were 42,121,570 and 3,440,965,
      respectively.

      During the year ended February 28, 2002, the Company received $109,000
      from the issuance of 155,714 shares of common stock through private
      placements to various investors.

NOTE 10  STOCK OPTIONS

      In 1995, the Company issued its president and shareholder the option to
      purchase 7,143 shares of common stock any time before December 1, 2005 for
      $7.00 per share. In January 2000, the Company issued an additional 142,857
      options to the president and shareholder, which are immediately
      exercisable, at an exercise price of $.70 per share with an expiration
      date of January 2004. In fiscal 2001, an additional 8,580 options were
      granted by the Company to an non-employee for consulting services of
      $61,350, which was charged to operations. 50,000 of these options have
      been exercised and 108,580 remain outstanding as of February 28, 2003. The
      agreement with the Company's president and shareholder also contains an
      anti-dilution provision that has the effect of increasing the options as
      of February 28, 2002. During the year ended February 28, 2002, 142,857
      options were granted and exercised under the anti-dilution provision. All
      additional options have the same expiration date of January 2004.

      For the year ended February 28, 2003, there were no options granted,
      exercised or terminated.

      The following is a summary of the status of stock option activity for the
      fiscal years ended February 28, 2003 and 2002.

                                                                     Weighted
                                                                     Average
                                                      Options     Exercise Price
                                                      --------      ---------
      Outstanding as of February 28, 2001              108,580      $    1.11
       Granted in 2002                                 142,857      $     .70
       Exercised in 2002                              (142,857)     $     .70
       Terminated                                           --             --
                                                      --------      ---------
      Outstanding as of February 28, 2002 and 2003     108,580      $    1.11
                                                      ========      =========


                                      F-16
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             AS OF FEBRUARY 28, 2003


      The Company has adopted the disclosure-only provisions of SFAS No. 123 but
      applies APB Opinion 25 ("Accounting for Stock Issued to Employees") in
      accounting for stock options issued to employees. Accordingly, no
      compensation has been recognized for the years ended February 28, 2003 and
      2002. The effect of applying SFAS 123 for the years ended February 28,
      2003 and 2002 was not material.

NOTE 11  INCOME TAXES

      Income tax expense (benefit) for the years ended February 28, 2003 and
2002 are summarized as follows:

                                                        2003            2002
                                                    -----------     -----------
      Current:
       Federal                                      $       --      $       --
       State                                                --              --
       Deferred Federal and State                           --              --
                                                    -----------     -----------
      Income tax expense (benefit)                  $       --      $       --
                                                    ===========     ===========

      The Company's tax expense differs from the "expected" tax expense for the
years ended February 28, 2003 and 2002 are as follows:

                                                        2003             2002
                                                    -----------     -----------

U.S. Federal income tax provision (benefit)         $  (578,386)    $(1,308,141)
Effect of unused net operating loss carryforward        578,386       1,308,141
                                                    -----------     -----------
                                                    $        --     $        --
                                                    ===========     ===========

      The tax effects of temporary differences that gave rise to significant
      portions of deferred tax assets and liabilities at February 28, 2003 and
      2002 are as follows:

                                                        2003            2002
                                                    -----------     -----------
      Deferred tax assets:
        Net operating loss carryforward             $(6,566,527)    $(5,988,141)
                                                    -----------     -----------
           Total gross deferred tax assets           (6,566,527)     (5,988,141)
        Less valuation allowance                      6,566,527       5,988,141
                                                    -----------     -----------
      Net deferred tax assets                       $        --     $        --
                                                    ===========     ===========


                                      F-17
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             AS OF FEBRUARY 28, 2003


      As of February 28, 2003, the Company has net operating loss carryforwards
      of $17,636,960 for U.S. Federal income tax purposes available to offset
      future taxable income expiring on various dates through 2023.

      The net change in the valuation allowance during the year ended February
28, 2003 was an increase of $578,386.

NOTE 12  COMMITMENTS AND CONTINGENCIES

      (A) LEASE COMMITMENTS AND CONTINGENCIES

      The Company leases its office space under a non-cancelable operating lease
agreement expiring in September 2004.

      The minimum annual lease payments due under the lease agreement is as
follows:

               For the Year Ended February 28,
                            2004                               $   23,440
                            2005                                   14,000
                                                               ----------
                                                               $   37,440
                                                               ==========

      Rent expense was approximately $26,400 and $33,000 for the years ended
      February 28, 2003 and 2002, respectively.

      (B) EMPLOYMENT AGREEMENT

      The Company has an employment contract (the "agreement") with its
      president through January 1, 2005, which provides for annual salary and
      bonuses based on Company revenues. The agreement also provides for
      one-year extensions every January 1 unless notice is given by the Company.
      In addition, the Company has granted this person 150,000 stock options
      with an anti-dilution provision (See Note 10).

      (C) LICENSES

      The Company has entered into various licensing agreements (the
      "agreements") for the right to manufacture, sell and distribute certain
      collectibles and novelties relating to current and future movie
      characters, as well as certain accessories containing logos and names of
      professional minor league and college sports teams. The agreements expire
      at various dates through 2003 and generally require the Company to pay a
      royalty of between 9% and 11% of sales, with certain minimum royalty
      payments required. The unpaid minimum royalty fees related to these
      agreements are included in accrued expenses in the accompanying balance
      sheet. Royalty expense amounted to approximately $356,000 and $472,000 for
      the years ended February 28, 2003 and 2002, respectively.


                                      F-18
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             AS OF FEBRUARY 28, 2003


      (D) CONTINGENCIES

      In the normal course of business the Company is subject to various
      regulations, proceedings, lawsuits, claims and other matters, including
      actions under laws and regulations related to the environment and health
      and safety, among others. The Company believes the amounts provided in its
      consolidated financial statements, as prescribed by generally accepted
      accounting principles, are adequate in light of the probable and estimable
      liabilities. However, there can be no assurances that the actual amounts
      required to discharge alleged liabilities from various lawsuits, claims,
      legal proceedings and other matters, and to comply with applicable laws
      and regulations, will not exceed the amounts reflected in the accompanying
      consolidated financial statements or will not have a material adverse
      effect on its consolidated results of operations, financial condition and
      cash flows. Any costs that may be incurred in excess of those amounts
      provided as of February 28, 2003 cannot currently be determined.

      In fiscal 2002, a licensing company commenced a lawsuit for various causes
      of action for breach of contract, trademark infringement and seeking a
      permanent injunction precluding the Company from using any of the
      plaintiffs' intellectual property. The Company consented to the entry of a
      permanent injunction and the parties entered into a settlement agreement,
      which resulted in the dismissal of the action in the subsequent period.
      However, despite the dismissal of the action, the plaintiff reserves the
      right to pursue monetary claims against the Company for its breach of
      various license agreements.

      (E) OTHER CONTINGENCIES

      The Company is non-compliant with respect to payment of employee and
      employer payroll-related taxes. The liability is approximately $253,000 as
      of February 28, 2003, which includes penalties and interest. The Company
      has previously accrued for this liability and no additional accrual was
      made in fiscal 2003.

      (F) MAJOR CUSTOMERS

      Approximately 83% and 60% of the Company's revenues were derived from its
      three largest customers for the fiscal years ended February 28, 2003 and
      2002, respectively.

      (G) AGREEMENTS

      In February 2003, the Company entered into a joint venture agreement with
      another party whereby the other party is responsible for providing
      replacement batteries for most popular brands of mobile telephones. The
      Company is responsible for obtaining the necessary licenses, design of the
      images and the marketing of the products. Under the terms of the


                                      F-19
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             AS OF FEBRUARY 28, 2003


      agreement, 50% of the sales are to be retained by the Company and the
      other 50% are to be remitted to the other entity. As of February 28, 2003,
      nothing has transpired under the joint venture.

NOTE 13  RELATED PARTY TRANSACTIONS

      The Company has an employment agreement with its president (see Note
      12(B)), who has elected to defer a portion of his salary in support of the
      cash needs of the Company. As of February 28, 2003 and 2002, the amount of
      salary deferred was approximately $309,500 and $167,000, respectively,
      which were included in accrued expenses. The Company has also issued stock
      options to the president (See Note 10).

      Included in notes and loans payable is approximately $97,000, which is
      included in notes payable - related parties in the accompanying balance
      sheet, due to the Company's president and other related parties as of
      February 28, 2003. The Company accrued interest related to these loans of
      approximately $5,000 each year and approximately $82,000 in accrued
      interest was payable relating to these loans as of February 28, 2003 which
      is recorded in accrued expenses in the accompanying consolidated balance
      sheet.

      The Company issued approximately 19,000,000 and 530,000 shares of common
      stock to officers, directors and family members for services rendered
      during the years ended February 28, 2003 and 2002, respectively.

NOTE 14  NON-CASH INVESTING AND FINANCING ACTIVITIES IN THE STATEMENTS OF CASH
         FLOWS

      During the year ended February 28, 2003, the Company converted $25,000 of
      notes and loans payable, $19,800 of convertible secured debentures,
      $25,000 of convertible subordinated debentures and $9,741 of related
      accrued interest into 18,457,365 shares of common stock having an
      aggregate fair value of $260,620. Since the conversions were based upon
      negotiated conversion prices with the debtors, the Company incurred a net
      loss on the conversions of $181,078, as the fair market value of the
      Company's common stock on the date of the conversions was more than the
      negotiated conversion prices.

      During the year ended February 28, 2002, the Company converted $36,000 of
      notes and loans payable, $12,500 of convertible secured debentures,
      $40,000 of convertible subordinated debentures and $16,033 of related
      accrued interest into 156,390 shares of common stock having an aggregate
      fair value of $188,391. Since the conversions were based upon negotiated
      conversion prices with the debtors, the Company incurred a net loss of
      $83,858, as the fair market value of the Company's common stock on the
      date of the conversions was more than the negotiated conversion prices.


                                      F-20
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             AS OF FEBRUARY 28, 2003


NOTE 15  SUBSEQUENT EVENTS

      Subsequent to February 28, 2003, the Company at various dates issued
      secured convertible debentures totaling $300,000 to a group of investors.
      These debentures mature one year from date of issuance, bear interest at
      15% per annum and are convertible into shares of the Company's common
      stock at the lesser of $ .01 or 25% discount from the lowest bid price
      over the 3 trading days during the 20 days preceding conversion.

      In December 2003, the Company and an employee entered into a five-year
      Employment Agreement under which the employee is to receive a weekly
      salary of $500. Additionally, 20,000,000 stock options are to be granted
      at exercise prices ranging from $.001 to $.004 per share. The options have
      a ten-year term. An additional 3,200,000 shares of our common stock are to
      be issued on or before the termination of the employment agreement.
      Compensation afforded to the employee under the agreement will also
      satisfy any and all our indebtedness to the employee and related parties.
      The amount of this debt is estimated to be $219,530.

      Subsequent to February 28, 2003, the Company entered into marketing
      relationships with various suppliers of products.


                                      F-21
<PAGE>

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

         On December 18, 2002, we dismissed Withum Smith & Brown ("WS&B") as our
principal independent accountant. On December 18, 2002, we engaged Weinberg &
Company, P.A. as our principal independent accountant.

         We engaged WS&B on July 5, 2001. During the last fiscal year ended
February 28, 2001 and through December 18, 2002, there were no disagreements
between us and WS&B on any matter of accounting principles or practices,
financial statement disclosure or auditing scope or procedure which, if not
resolved to the satisfaction of WS&B would have caused WS&B to make reference to
the matter in its reports on our financial statements. During the last most
recent fiscal year ended February 28, 2001 and through December 18, 2002, there
were no reportable events as the term described in Item 304(a)(1)(iv) of
Regulation S-B.

         During the two most recent fiscal years and through December 18, 2002,
we have not consulted with Weinberg & Company, P.A. regarding either:

         1. the application of accounting principles to any specified
transaction, either completed or proposed, or the type of audit opinion that
might be rendered on our financial statements, and neither a written report was
provided to us nor oral advice was provided that Weinberg & Company, P.A.
concluded was an important factor considered by us in reaching a decision as to
the accounting, auditing or financial reporting issue; or

         2. any matter that was either subject of disagreement or event, as
defined in Item 304(a)(1)(iv)(A) of Regulation S-B and the related instruction
to Item 304 of Regulation S-B, or a reportable event, as that term is explained
in Item 304(a)(1)(iv)(A) of Regulation S-B.

         We had requested that WS&B furnish us with a letter addressed to the
Securities and Exchange Commission stating whether it agrees with the above
statements. A copy of such letter, dated December 20, 2002, was filed as Exhibit
16.1 to the Form 8-K filed with the Securities and Exchange Commission on
December 20, 2002.


                                       20
<PAGE>

                                    PART III

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

NAME                    AGE               POSITION
----                    ---               --------
Paul Lipschutz          55                Chief Executive Officer and Director
Jay Lipschutz           35                Secretary

Directors serve until the next annual meeting and until their successors are
elected and qualified. Officers are appointed to serve for one year until the
meeting of the board of directors following the annual meeting of stockholders
and until their successors have been elected and qualified.

PAUL LIPSCHUTZ. Mr. Lipschutz has been our Chief Executive Officer and a
director since 1992. Mr. Lipschutz is a 1967 graduate of The Wharton School of
Finance and Commerce of the University of Pennsylvania.

JAY LIPSCHUTZ. Mr. Lipschutz has been our Secretary since December 2001. From
1999 until December 2001, Mr. Lipschutz served as our director of shipping and
receiving. Prior to 1999, Mr. Lipschutz served as the director of shipping and
receiving at Children's Hospital of Philadelphia.

COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

Based solely upon a review of Forms 3, 4 and 5, and amendments thereto,
furnished to us during fiscal year 2003, we are not aware of any director,
officer or beneficial owner of more than ten percent of the Company's Common
Stock that, during fiscal year 2003, failed to file on a timely basis reports
required by Section 16(a) of the Securities Exchange Act of 1934.


                                       21
<PAGE>

ITEM 10. EXECUTIVE COMPENSATION.

The following table sets forth certain compensation paid or accrued by us to
certain of our executive officers during fiscal years ended 2003, 2002 and 2001.
Summary Compensation Table

<TABLE>
<CAPTION>
                                                                         Other
                                                           Annual      Restricted     Options       LTIP
  Name & Principal                Salary       Bonus       Compen-       Stock         SARs       Payouts      All Other
      Position          Year        ($)         ($)      sation ($)    Awards ($)     (#)(1)        ($)      Compensation
--------------------- --------- ------------ ----------- ------------ -------------- ----------- ------------ --------------
<S>                     <C>      <C>             <C>           <C>         <C>           <C>          <C>          <C>
Paul S. Lipschutz,      2003     142,750 (1)
CEO                     2002     142,750 (1)
                        2001     125,000 (1)     0             0           0             0            0            0
--------------------- --------- ------------ ----------- ------------ -------------- ----------- ------------ --------------
</TABLE>

(1) Mr. Lipschutz agreed to defer his salary in fiscal years 2003, 2002 and 2001
due to our financial condition and to help us secure financing. Mr. Lipschutz
received an aggregate 70,714 shares of common stock as compensation for services
in fiscal year 2001, 30,588 in fiscal year 2002 and 14,000,000 in fiscal year
2003.

OPTIONS

         No options were exercised or granted during fiscal 2003.

         There were no long-term incentive plans or rewards made in fiscal 2003.

EMPLOYMENT AGREEMENTS

         Mr. Lipschutz, our Chief Executive Officer, has an Employment Agreement
with us which became effective on January 1, 1999 and which originally expired
on January 1, 2004. At each anniversary date of the Employment Agreement, the
Employment Agreement will extend for another year, unless either Mr. Lipschutz
or we give ninety days prior notice of intent not to have the Agreement renewed.
No notice was given on January 1, 2004; therefore the Employment Agreement has
been extended to January 1, 2005. If no notice is given on January 1, 2005, the
term of the Employment Agreement will be extended to January 1, 2006.

         Under the Employment Agreement, Mr. Lipschutz was also granted an
option originally exercisable for 143,137 shares of our common stock,
immediately exercisable, at a price of $.70 per share (the "Option"). In January
2000, the Company issued an additional 142,857 options to Mr. Lipschutz, which
were immediately exercisable, at an exercise price of $.70 per share and were
exercised in fiscal year 2002. 50,000 of these options were exercised during
year ended February 28, 2002 and 92,857 remain outstanding as of February 28,
2003. The agreement also contains an anti-dilution provision that has the effect
of increasing the options as of February 28, 2002. During the year ended
February 28, 2002, 142,857 options were granted and exercised for services
rendered under the anti-dilution provision.


                                       22
<PAGE>

These Option may be exercised in whole or in part through January 1, 2004, but
partial exercises of the Option must be made in lots of 100,000 shares or
greater. The Option will continue to be exercisable for its original term after
in the event of Mr. Lipschutz' death or the termination of his employment with
us. Under the Employment Agreement, the number of shares for which the option is
exercisable has anti-dilution protection so that the option will always be
exercisable for 11.52% of our outstanding Common Stock. These options have
expired as of January 1, 2004.

         Mr. Lipschutz's initial base salary under the Employment Agreement for
calendar year 1999 was $125,000. During the calendar year 2000 and for each year
thereafter, Mr. Lipschutz is entitled to an additional salary based on our gross
sales as follows:

                     Annual Revenues                  Additional Salaries
                     ---------------                  -------------------
               $1,000,000 to $1,999,999                     $25,000
               $2,000,000 to $2,999,999                     $50,000
               $3,000,000 to $4,999,999                     $75,000
     Each $1,000,000 increment thereafter                   $25,000

         Beginning with calendar year 2001, Mr. Lipschutz's base salary will
increase by 15% of the sum of his previous year's base salary and additional
salary under the table above for the immediately preceding year. Mr. Lipschutz
agree to forgo his 15% increase for calendar year ended 2003.

DIRECTORS COMPENSATION.

         Each director receives 50,000 shares of our common stock per quarter
for their services.


                                       23
<PAGE>

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICAL OWNERS AND MANAGEMENT.

As of June 30, 2004, there were 478,972,190 shares of common stock, par value
$0.001 outstanding. The following table sets forth certain information regarding
the beneficial ownership of our common stock as of June 30, 2004:

      -     all directors

      -     each person who is known by us to be the beneficial owner of more
            than five percent (5%) of the outstanding common stock

      -     each executive officer named in the Summary Compensation Table

      -     all directors and executive officers as a group

The number of shares beneficially owned by each director or executive officer is
determined under rules of the SEC, and the information is not necessarily
indicative of beneficial ownership for any other purpose. Under the SEC rules,
beneficial ownership includes any shares as to which the individual has the sole
or shared voting power or investment power. In addition, beneficial ownership
includes any shares that the individual has the right to acquire within 60 days.
Unless otherwise indicated, each person listed below has sole investment and
voting power (or shares such powers with his or her spouse). In certain
instances, the number of shares listed includes (in addition to shares owned
directly), shares held by the spouse or children of the person, or by a trust or
estate of which the person is a trustee or an executor or in which the person
may have a beneficial interest.

Title of Class    Name and Address                 Amount of        Percent of
                  of Beneficial Owner              Beneficial         Class
                                                   Ownership           (1)

Common Stock      Paul S. Lipschutz                86,865,081 (2)     18.1%
                  1600 Lower State Road
                  Doylestown, PA 18901

Common Stock      Jay Lipschutz                       939,641            *
                  1600 Lower State Road
                  Doylestown, PA 18901

Common Stock      Shares of all directors and      87,804,722 (2)     18.3%
                  executive officers as a
                  group (2 persons)

Common Stock      Kenneth Adelberg                 43,250,000          9.0%
                  609 Longchamps Drive
                  Devon, PA 19333


                                       24
<PAGE>

Common Stock      Richard and Elizabeth Elmore     66,666,700         13.9%
                  1600 Lower State Road
                  Doylestown, PA 18901

* Represents less than 1%

(1) Based on 478,972,190 shares of common stock currently outstanding.

(2) Include 5,000,000 shares owned by Paul Lipschutz's wife, Marilyn Lipschutz,
as to which Mr. Lipschutz disclaims beneficial ownership. Includes 375 shares
owned by the estate of Harvey Benson, of which Mr. Lipschutz serves as Executor.

STOCK OPTION PLANS

         None.


                                       25
<PAGE>

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

         Beginning in fiscal year 1996, Mr. Lipschutz, our Chief Executive
Officer, made various loans to us to assist with meeting our important
expenditures.

         At February 28, 2003, the principal amount of Mr. Lipschutz's loan had
increased to $53,715 through net borrowings. The loan accumulated $5,071 in
interest during fiscal year 2003, and the loan had total accrued interest of
$82,228 at February 28, 2003. The total amount owed to Mr. Lipschutz, with
interest and principal on the loan, at February 28, 2003 was $135,943.

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

We filed the following reports on Form 8-K during our fourth quarter of fiscal
2003:

         Form 8-K, December 20, 2002, Item 4 - Reporting the dismissal of
WithumSmith+Brown as the Company's auditor and the appointment of Weinberg &
Company, P.A. as the Company's new auditors.

EXHIBITS

3.1 Certificate of Incorporation of the Company filed as Exhibit 3.1 to the
registration statement on Form 10-SB filed with the Commission on May 24, 2000
and incorporated herein by reference.

3.2 Amendment to Certificate of Incorporation of the Company, changing the name
of the Company from Amour Corporation to Bard Sports Corp., filed as Exhibit 3.1
to the registration statement on Form 10-SB filed with the Commission on May 24,
2000 and incorporated herein by reference.

3.3 Amendment to Certificate of Incorporation of the Company, changing the name
of the Company from Bard Sports Corp. to USA Sports Group, Inc. and increasing
the authorized common stock, filed as Exhibit 3.1 to the registration statement
on Form 10-SB filed with the Commission on May 24, 2000 and incorporated herein
by reference.

3.4 Amendment to Certificate of Incorporation of the Company, changing the name
of the Company from USA Sports Group, Inc. to Collectible Concepts Group, Inc.
and increasing the authorized common stock, filed as Exhibit 3.1 to the
registration statement on Form 10-SB filed with the Commission on May 24, 2000
and incorporated herein by reference.

3.5 By-Laws of the Company, filed as Exhibit 3.2 to the registration statement
on Form 10-SB filed with the Commission on May 24, 2000 and incorporated herein
by reference.

4.1 Form of debenture, filed as Exhibit 4.1 to the registration statement on
Form 10-SB filed with the Commission on May 24, 2000 and incorporated herein by
reference.

4.2 Form of debenture issued April 2000, filed as Exhibit 4.2 to the
registration statement on Form 10-SB filed with the Commission on May 24, 2000
and incorporated herein by reference.

4.3 Form of Stock Purchase Warrant, filed as Exhibit 4.3 to the registration
statement on Form 10-SB filed with the Commission on May 24, 2000 and
incorporated herein by reference.


                                       26
<PAGE>

4.4 Form of Registration Rights Agreement, filed as Exhibit 4.4 to the
registration statement on Form 10-SB filed with the Commission on May 24, 2000
and incorporated herein by reference.

4.5 Secured Convertible Debenture with New Millennium Capital Partners II, LLC,
AJW Partners, LLC and Equilibrium Equity, LLC, filed as Exhibit 10.11 to the
registration statement on Form 10-SB/A filed with the Commission on September 7,
2000 and incorporated herein by reference.

4.6 Security Agreement by and among the Company, New Millennium Capital Partners
II, LLC, AJW Partners, LLC and Equilibrium Equity, LLC, filed as Exhibit 10.12
to the registration statement on Form 10-SB/A filed with the Commission on
September 7, 2000 and incorporated herein by reference.

10.1 Paul Lipschutz employment agreement, filed as Exhibit 10.1 to the
registration statement on Form 10-SB filed with the Commission on May 24, 2000
and incorporated herein by reference.

10.2 License and Marketing Agreement between the Company and Building Q, filed
as Exhibit 10.2 to the registration statement on Form 10-SB filed with the
Commission on May 24, 2000 and incorporated herein by reference.

10.3 Merchandising Agreement between the Company and New Line Productions, Inc.,
filed as Exhibit 10.3 to the registration statement on Form 10-SB filed with the
Commission on May 24, 2000 and incorporated herein by reference.

10.4 Royalty Agreement between the Company and Galena Industries, filed as
Exhibit 10.4 to the registration statement on Form 10-SB filed with the
Commission on May 24, 2000 and incorporated herein by reference.

10.5 License Agreement between the Company and Creative Licensing Corporation,
filed as Exhibit 10.5 to the registration statement on Form 10-SB filed with the
Commission on May 24, 2000 and incorporated herein by reference.

10.6 License Agreement between the Company and Canal+ DA, filed as Exhibit 10.6
to the registration statement on Form 10-SB filed with the Commission on May 24,
2000 and incorporated herein by reference.

10.7 Financial Consulting Agreement between the Company and NIR Group, LLC filed
as Exhibit 10.7 to the registration statement on Form 10-SB filed with the
Commission on May 24, 2000 and incorporated herein by reference.

10.8 License Agreement between the Company and Marvel Characters, Inc., filed as
Exhibit 10.8 to the registration statement on Form 10-SB filed with the
Commission on May 24, 2000 and incorporated herein by reference.

10.9 Lease for 1600 Lower State Road, filed as Exhibit 10.9 to the registration
statement on Form 10-SB filed with the Commission on May 24, 2000 and
incorporated herein by reference..

10.10 Agreement by and among the Company, Verne Troyer and TC Ventures, filed as
Exhibit 10.10 to the registration statement on Form 10-SB filed with the
Commission on May 24, 2000 and incorporated herein by reference.


                                       27
<PAGE>

10.11 Separation Agreement between the Company and S.D. Studios, filed as
Exhibit 10.13 to the registration statement on Form 10-SB/A filed with the
Commission on September 7, 2000 and incorporated herein by reference.

31.1        Certification by Chief Executive Officer pursuant to Sarbanes-Oxley
            Section 302.

31.2        Certification by Chief Financial Officer pursuant to Sarbanes-Oxley
            Section 302.

32.1        Certification by Chief Executive Officer pursuant to 18 U.S. C.
            Section 1350.

32.2        Certification by Chief Financial Officer pursuant to 18 U.S. C.
            Section 1350.

ITEM 3 - CONTROLS AND PROCEDURES

      a)    Evaluation of Disclosure Controls and Procedures. As of February 28,
            2003, the Company's management carried out an evaluation, under the
            supervision of the Company's Chief Executive Officer and Principal
            Financial Officer of the effectiveness of the design and operation
            of the Company's system of disclosure controls and procedures
            pursuant to the Securities and Exchange Act , Rule 13a-15(e) and
            15d-15(e) under the Exchange Act). Based upon that evaluation, the
            Chief Executive Officer and Principal Financial Officer concluded
            that the Company's disclosure controls and procedures were
            effective, as of the date of their evaluation, for the purposes of
            recording, processing, summarizing and timely reporting material
            information required to be disclosed in reports filed by the Company
            under the Securities Exchange Act of 1934.

      b)    Changes in internal controls. There were no changes in internal
            controls over financial reporting, known to the Chief Executive
            Officer or Principal Financial Officer that occurred during the
            period covered by this report that has materially affected, or is
            likely to materially effect, the Company's internal control over
            financial reporting.


                                       28
<PAGE>

                                   SIGNATURES

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

                        Collectible Concepts Group, Inc., a Delaware Corporation



Dated: July 30, 2004                        By: /s/ Paul Lipschutz
                                                    ----------------------
                                                    Paul Lipschutz
                                                    Chief Executive 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.

SIGNATURE                                TITLE                          DATE
---------                                -----                          ----

/s/ Paul Lipschutz               Chief Executive Officer           July 30, 2004
-------------------------        and Director
Paul Lipschutz

/s/ Jay Lipschutz                Director                          July 30, 2004
-------------------------
Jay Lipschutz


                                       29