UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 6-K

REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934

~~March~~ 20October 15, 2007

OSI GEOSPATIAL INC.

(Translation of registrant’s name into English)

~~107~~300-~~930~~4585 ~~West~~March ~~1st Street~~Road. ~~North Vancouver~~Kanata, BCON ~~V7P~~K2K ~~3N4~~2E4, Canada

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F þ Form 40-F o

Indicate by check mark whether the registrant by furnishing the information contained in this form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes o No þ

~~OSI~~News ~~Geospatial Inc.~~ Release

~~NOTICE~~FOR ~~OF 2007~~IMMEDIATE ~~ANNUAL AND~~RELEASE ~~SPECIAL GENERAL MEETING~~

~~INFORMATION~~OSI ~~CIRCULAR~~Geospatial Reports 2007 Third Quarter Results

~~March~~October 1915, 2007 Ottawa, Canada

TOOSI ~~OUR~~Geospatial ~~SHAREHOLDERS~~Inc. (TSX: OSI; OTCBB: OSIIF) announced today its financial results for the third quarter ending August 31, 2007. All amounts are reported in U.S. dollars and in accordance with Canadian GAAP.

IFor amthe ~~pleased~~third toquarter ~~invite~~of ~~you~~2007, toOSI ~~attend~~Geospatial ~~the~~Inc. ~~Annual~~reported ~~and~~revenue ~~Special~~of ~~General~~$7.3 million, ~~Meeting~~a (70% increase from the ~~“Meeting”)~~$4.3 million ~~of shareholders~~reported offor ~~OSI~~the ~~Geospatial~~third ~~Inc~~quarter in 2006. ~~(OSI) to~~Marine besystems ~~held~~revenue onwas ~~Wednesday~~$3.1 million, ~~April 18,~~a ~~2007~~152% atincrease from the $1~~:30~~.2 million preported in the third quarter of 2006.m. Land and air ~~(Pacific~~systems ~~Time)~~revenue atwas ~~the~~$2.6 million ~~Metropolitan~~compared ~~Hotel~~with at$2.0 million ~~645~~in ~~Howe~~the ~~Street~~third quarter of 2006, ~~Vancouver~~an increase of 30%. Mapping revenue was $1.6 million compared to $1.1 million in the third quarter of 2006, ~~British~~an ~~Columbia~~increase of 51%.

~~The~~For ~~attached~~the ~~Notice~~third quarter of ~~Annual~~2007, ~~and~~the ~~Special~~company ~~General~~reported ~~Meeting~~net ~~and~~earnings ~~Information~~of ~~Circular~~$332,000, ~~provide~~before ~~details~~taxes and $279,000 after taxes compared with a net loss of ~~the~~$913,000 ~~business~~before totaxes beand ~~conducted~~a atnet loss of $709,000 after taxes in the ~~Meeting~~third quarter of 2006. AFor ~~copy~~the third quarter of 2007, the ~~Company’s~~net ~~Annual~~earnings attributable ~~Report~~to iscommon ~~also enclosed~~shareholders ~~and~~was ~~highlights~~$109,000 ~~some~~or of$nil ~~OSI’s~~per ~~significant~~share, ~~achievements~~compared ~~over~~to the ~~last~~net ~~year~~loss of $972,000 or $0.03 per share in 2006.

~~Your~~The ~~vote~~Company has determined that it is ~~important~~in the best interests of investors to ~~us.~~report ~~Whether~~its orfinancial results ~~not~~in ~~you~~accordance ~~plan~~with Canadian generally accepted accounting principles. The Company looks forward to ~~attend~~reporting ~~the~~under ~~Meeting,~~International ~~please~~Financial ~~sign,~~Reporting ~~date~~Standards ~~and~~(IFRS) as Canadian ~~return~~accounting ~~the~~and ~~enclosed~~regulatory ~~proxy~~authorities ~~according~~have laid out a clear path to ~~the~~convergence ~~instructions~~with onIFRS ~~the~~by ~~form~~2011.

I“This ~~look~~quarter, ~~forward~~we have seen significant progress with our major customers, including the U.S. Army, the U.S. Coast Guard, the U.S. Department of Homeland Security, and the Australian Navy. We are especially pleased to ~~seeing~~have ~~you~~renewed atour relationship with the ~~Meeting~~U.S. onCoast ~~April 18~~Guard, secured our first project with the U.S. Department of Homeland Security and successfully closed a financing to support our plans to aggressively enter the national security market,” said Ken Kirkpatrick, president and CEO of OSI Geospatial.

~~Sincerely,~~Third Quarter Highlights

OSI Geospatial Inc.

	•		Signed contracts with the U.S. Army totaling approximately $2.9 million.

	•		Launched a new business unit, Layered Security Solutions, to provide integrated vulnerability assessments, technology and operational solutions for the critical infrastructure protection markets.

KENNETH KIRKPATRICK President and Chief Executive Officer


OSI Geospatial Inc.	Suite 300-340 March Road	tel 613 287 0462 fax 613-287-0466
	Kanata, ON K2K 2E4 Canada	www.osigeospatial.com

~~NOTICE~~News ~~OF ANNUAL AND SPECIAL GENERAL MEETING OF SHAREHOLDERS~~ Release

~~NOTICE~~• ISSigned ~~HEREBY~~a ~~GIVEN~~contract ~~that~~valued ~~the~~at ~~2007~~approximately ~~Annual~~$2.1 ~~and~~million ~~Special~~to ~~General~~provide ~~Meeting (~~the ~~“Meeting)~~U.S. Department of ~~the shareholders~~Homeland ofSecurity ~~OSI~~with ~~GEOSPATIAL~~critical ~~INC~~infrastructure vulnerability assessments. ~~(the~~• ~~“Company”)~~Signed ~~will~~a becontract ~~held~~valued at approximately $1.3 million to provide the ~~Metropolitan~~U.S. ~~Hotel,~~Coast ~~645 Howe~~Guard ~~Street,~~with ~~Vancouver,~~ECPINS® ~~British~~navigation ~~Columbia,~~systems. on• ~~Wednesday,~~Closed ~~April 18~~a private placement with Clarus Securities Inc. resulting in gross proceeds of CDN $3,614,000 ~~2007~~to be used to support the development of the Company’s Layered Security Solutions business unit and other growth initiatives. • Signed a contract valued at ~~1:30~~approximately p$2.m.0 ~~(Pacific~~million ~~Time) for~~to provide the ~~following~~Australian ~~purposes:~~ Navy with submarine navigation systems.

~~(a) to receive and consider the report of the directors~~Outlook; ~~(b)~~Reaching toOur ~~receive~~Objectives ~~and consider the financial statements of the Company~~ for the financial year ended November 30, 2006 and the report of the auditors thereon; (c) to appoint an auditor for the Company for the ensuing year; (d) to fix the number of directors; (e) to elect directors for the ensuing year; (f) to consider and, if thought fit, pass an ordinary resolution approving an amended and restated shareholder rights plan; and (g) to transact such other business as may properly come before the Meeting, or any adjournment or adjournments thereof.2007

~~The~~“Since ~~text~~the end of the ~~proposed~~third ~~ordinary~~quarter, ~~resolution~~we tohave ~~approve~~further expanded the ~~amended~~development of the U.S. Navy small boat market and ~~restated~~successfully ~~shareholder~~closed ~~rights~~our second contract this year. In addition, we have ~~plan~~secured ofour ~~the~~second ~~Company~~project isfor ~~set~~our ~~out~~new inLayered ~~the~~Security ~~accompanying~~Solutions ~~Information~~division ~~Circular~~to provide port security vulnerability assessment services for a major U.S. port”, said Mr. Kirkpatrick. “We are optimistic about the significant opportunities in the ~~section~~U.S ~~entitled “Particulars~~navy ofsmall ~~Matters~~boat toand beU.S ~~Acted~~Department ~~Upon”~~of Homeland Security markets.”

~~The~~“We ~~accompanying~~expect ~~Information~~to ~~Circular~~show ~~provides~~solid ~~additional~~revenue ~~information~~growth ~~relating~~in to the ~~matters~~fourth toquarter ~~be dealt~~and ~~with~~are atforecasting approximately ~~the~~$9 million ~~Meeting~~in revenue and iscontinued ~~deemed~~quarterly profitability. Due to ~~form~~the ~~part~~delay of closing ~~this~~specific ~~Notice.~~contracts, ~~Copies~~we ofwill ~~any~~unfortunately ~~documents~~generate toa ~~be considered,~~loss ~~approved,~~for ~~ratified~~the ~~and~~fiscal ~~adopted~~year. orWe ~~authorized at~~ expect the ~~Meeting~~first ~~will~~quarter beof ~~available~~2008 ~~for inspection~~to atshow ~~the~~significant ~~registered~~improvements ~~and~~over ~~records~~the ~~office~~same ofquarter ~~the~~in ~~Company~~2007. atOur customers’ ~~Suite 800~~priorities –and ~~885~~schedules ~~West~~continue ~~Georgia Street,~~to ~~Vancouver,~~influence ~~British~~our ~~Columbia~~results,” ~~V6C~~continued ~~3H1,~~Mr. Kirkpatrick. “The ~~during~~lengthy ~~normal~~and ~~business~~complex ~~hours~~contracting upprocesses tohave delayed the ~~date~~signing of ~~the Meeting,~~awarded contracts and customers’ atoperational requirements have delayed the ~~Meeting~~delivery and installation of our products.”

The ~~directors~~company ofestablished the ~~Company~~following ~~have~~goals ~~fixed~~for ~~March 14, 2007 as~~ the ~~record~~fiscal ~~date~~year ~~for~~ending ~~the~~November 30, ~~determination~~2007 ofand reports the ~~shareholders~~following ~~entitled to receive this Notice.~~progress:

~~Accompanying~~1. ~~this~~Achieve ~~Notice~~revenue ~~are~~in anthe ~~Information~~range ~~Circular, form~~ of ~~proxy,~~$28 ~~request~~million ~~form respecting financial statements, the Company’s Annual Report, which includes the Letter~~ to ~~Shareholders,~~$32 ~~and other~~million ~~corporate information, the consolidated financial statements~~ for ~~the~~fiscal ~~years~~2007 ~~ended November 30, 2006~~ and ~~2005 with the auditor’s report thereon, and management’s discussion and analysis. The Information Circular contains information relating to the matters to~~ be ~~addressed at the Meeting.~~ profitable

A• ~~shareholder~~Reported ~~who~~revenue isof ~~entitled~~$17.1 tomillion ~~attend~~for ~~and vote at~~ the ~~Meeting,~~first ornine anmonths ~~intermediary holding shares on behalf~~ of an2007 ~~unregistered~~• ~~member,~~Signed iscontracts ~~entitled~~worth close to ~~appoint~~$25 amillion ~~proxy~~year to ~~attend~~date ~~and vote~~ in ~~his~~2007 ~~or her~~• ~~stead.~~Awarded ~~Any~~contracts ~~shareholders~~worth ~~who~~more dothan ~~not~~$19 ~~expect~~million year to ~~attend~~date ~~the Meeting~~ in ~~person~~2007 ~~are~~• ~~requested~~Forecasting ~~to complete,~~revenue ~~sign~~of ~~and~~approximately ~~date~~$26 ~~the~~million, ~~enclosed~~due ~~form~~to ofdelays ~~proxy~~in orclosing ~~other~~awarded ~~form~~contracts ~~of proxy~~ and ~~return~~customer ~~same~~delivery ~~within the~~schedules ~~time~~• ~~and~~Continued toprofitability in the ~~location~~fourth inquarter, ~~accordance~~but ~~with~~expect ~~the~~to ~~instructions~~generate ~~set~~a ~~out~~loss infor the ~~form~~fiscal ofyear ~~proxy~~due ~~and Information~~to ~~Circular~~delays ~~accompanying~~in ~~this~~closing ~~Notice.~~ specific contracts

~~DATED~~2. atSecure ~~North~~a ~~Vancouver,~~significant ~~British~~U.S. ~~Columbia,~~Department ~~this~~of ~~14th~~Defense ~~day~~and U.K. Ministry of ~~March,~~Defence ~~2007.~~ prime contract;

ON• ~~BEHALF~~Several OFopportunities ~~THE~~under ~~BOARD~~development, OFbut ~~DIRECTORS~~lengthy ~~OF OSI~~and ~~GEOSPATIAL~~complicated ~~INC.~~ government procurement processes are creating delays

~~JOHN~~3. ~~SENTJENS Secretary~~ Continue to expand the company’s customer base by securing new customers in each of the three defense domains: air, land, and sea. New customers include;

Table of Contents

PROXY SOLICITATIONS			2
APPOINTMENT OF PROXIES			2
REVOCATION OF PROXIES			2
CHANGES TO PROXY DELIVERY TO BENEFICIAL SHAREHOLDERS			2
ADVICE TO BENEFICIAL SHAREHOLDERS			3
VOTING OF PROXIES			4
VOTING IN PERSON			5
INTEREST OF CERTAIN PERSONS OR COMPANIES IN MATTERS TO BE ACTED UPON			5
VOTING SECURITIES AND PRINCIPAL HOLDERS OF VOTING SECURITIES			5
ELECTION OF DIRECTORS			5
STATEMENT OF EXECUTIVE COMPENSATION			7
REPORT ON EXECUTIVE COMPENSATION			11
STOCK PERFORMANCE GRAPH			12
COMPENSATION OF DIRECTORS			13
SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS			14
CORPORATE GOVERNANCE			14
AUDIT COMMITTEE AND RELATIONSHIP WITH AUDITOR			17
INDEBTEDNESS OF DIRECTORS AND EXECUTIVE OFFICERS			17
INTEREST OF INFORMED PERSONS IN MATERIAL TRANSACTIONS			17
APPOINTMENT OF AUDITOR			17
MANAGEMENT CONTRACTS			17
PARTICULARS OF MATTERS TO BE ACTED UPON			17
DISCLOSURE RESPECTING SECURITY-BASED COMPENSATION ARRANGEMENTS			23
PARTICULARS OF OTHER MATTERS TO BE ACTED UPON			24
ADDITIONAL INFORMATION			25
BOARD APPROVAL			25
BOARD OF DIRECTORS’ MANDATE			26

INFORMATION CIRCULAR

THIS DOCUMENT CONTAINS INFORMATION AS AT MARCH 14, 2007. UNLESSOTHERWISE INDICATED, ALL AMOUNTS ARE IN CANADIAN DOLLARS.

PROXY SOLICITATIONS

The form of proxy accompanying this Information Circular is being solicited on behalf of the management of OSI GEOSPATIAL INC. (“we”, “us” or the “Company”) for use at the Annual and Special General Meeting of Shareholders of the Company (and any adjournment thereof) (the “Meeting”) to be held on Wednesday, April 18, 2007 at the time and place and for the purposes set out in the accompanying Notice of Meeting.

Management’s solicitation of proxies will primarily be by mail, but some proxies may be solicited personally or by telephone by the regular employees of the Company at nominal cost. All costs of solicitation by management will be borne by the Company.

APPOINTMENT OF PROXIES

The individuals named in the accompanying form of proxy are directors and/or officers of the Company.

A shareholder wishing to appoint some other person (who need not be a shareholder) to represent him at the Meeting has the right to do so, either by striking out the names of those persons named in the accompanying form of proxy and inserting the desired person’s name in the blank space provided in the form of proxy or by completing another form of proxy.

A proxy will not be valid unless the completed form of proxy is received by Computershare Investor Services Inc., Attention: Proxy Department, 9th Floor, 100 University Avenue, Toronto, Ontario, M5J 2Y1, or by fax at 1-866-249-7775, (the “Transfer Agent”) not less than 48 hours (excluding Saturdays, Sundays, and holidays) before the time for holding the Meeting or any adjournment thereof, or delivered to the Chair of the Meeting prior to the commencement of the Meeting.

REVOCATION OF PROXIES

A shareholder who has given a proxy may revoke it by an instrument in writing executed by the shareholder or by his attorney authorized in writing or, where the shareholder is a corporation, by a duly authorized officer or attorney of the corporation, and delivered to the registered and records office of the Company, at Suite 800 – 885 West Georgia Street, Vancouver, British Columbia, V6C 3H1, at any time up to and including the last business day preceding the day of the Meeting or if adjourned, any reconvening thereof, or to the Chair of the Meeting on the day of the Meeting or, if adjourned, any reconvening thereof or in any other manner provided by law. A revocation of a proxy does not affect any matter on which a vote has been taken prior to the revocation.

CHANGES TO PROXY DELIVERY TO BENEFICIAL SHAREHOLDERS

There are two kinds of beneficial owners – those who object to their name being made known to the issuers of securities which they own (called OBOs for Objecting Beneficial Owners) and those who do not object to the issuers of the securities they own knowing who they are (called NOBOs for Non-Objecting Beneficial Owners). Up until September 2002, issuers (including the directors and officers of the Company) had no knowledge of the identity of any of their beneficial owners, including NOBOs.

~~After~~News September 1, 2002, subject to the provision of National Instrument 54-101, “Communication with Beneficial Owners of Securities of Reporting Issuers”, issuers could request and obtain a list of their NOBOs from intermediaries via their transfer agents. Issuers may now obtain and use this NOBO list for distribution of proxy-related materials directly to NOBOs. Release

~~This~~• ~~year,~~U.S. ~~the~~Department ~~Company has decided to take advantage~~ of ~~those~~Homeland ~~provisions~~Security of• ~~National~~U.S. ~~Instrument 54-101~~Navy ~~that~~Naval ~~permit~~Expeditionary itCombat toCommand ~~directly~~• ~~deliver proxy-related materials to its NOBOs via its transfer agent~~U.S. AsMarine aCorps ~~result,~~Training NOBOs can expect to receive a scannable Voting Instruction Form from the Company’s transfer agent, Computershare Trust Company of Canada (or Computershare Investor Services Inc.) (“Computershare”). Systems

~~ADVICE~~4. TOContinue ~~BENEFICIAL~~to ~~SHAREHOLDERS~~ diversify into new market sectors by leveraging the company’s core technology in the development of new products;

~~The~~• ~~information~~Developing ina ~~this~~handheld ~~section~~device isfor offrontline ~~significant~~medical ~~importance~~personal toin ~~many~~the ~~shareholders,~~U.S. as• Developing a ~~substantial number~~small ofboat ~~shareholders~~asset docontrol ~~not~~and ~~hold~~tracking ~~common~~system ~~shares~~(ACT) infor ~~their~~maritime ~~own~~interdiction ~~name.~~ operations (MIOPS) • Developing a digital maritime operations plot system (DMOPS) for advanced submarine navigation operations

~~Shareholders~~5. ~~who~~Establish ~~hold~~the ~~their~~company ~~common~~as ~~shares~~a ~~through~~creditable ~~their~~supplier ~~brokers, intermediaries, trustees, or other persons, or who otherwise do not hold their common shares~~ in ~~their own name (referred to in this Circular as “Beneficial Shareholders”) should note that only proxies deposited by shareholders who appear on~~ the ~~records~~global ~~maintained~~national bysecurity ~~the~~/ ~~Company’s~~homeland ~~registrar~~defense ~~and transfer agent as registered holders of common shares will be recognized and acted upon at the Meeting.~~ market

If the common shares are listed in an account statement provided to a Beneficial Shareholder by a broker, those common shares will, in all likelihood, not be registered in the shareholder’s name. Such common shares will more likely be registered under the name of the shareholder’s broker or an agent of that broker. In Canada, the vast majority of such shares are registered under the name of CDS & Co. (the registration name for The Canadian Depositary for Securities, which acts as nominee for many Canadian brokerage firms). Common shares held by brokers (or their agents or nominees) on behalf of a broker’s client can only be voted (for or against resolutions) at the direction of the Beneficial Shareholder. Without specific instructions, brokers and their agents and nominees are prohibited from voting shares for the broker’s clients. Therefore, each Beneficial Shareholder should ensure that voting instructions are communicated to the appropriate person well in advance of the Meeting.

	•		Launched Layered Security Solutions business unit and signed a $2.1M contract to provide services to the U.S. Department of Homeland Security

	•		Awarded a contract valued at approx. $1.2 million to conduct a port vulnerability assessment for a major port in the United States

~~Existing~~Conference ~~regulatory policy requires brokers and other intermediaries to seek voting instructions~~Call from Beneficial Shareholders in advance of shareholders’ meetings. The various brokers and other intermediaries have their own mailing procedures and provide their own return instructions to clients, which should be carefully followed by Beneficial Shareholders in order to ensure that their common shares are voted at the Meeting.

~~The~~OSI ~~form~~Geospatial ofwill ~~proxy~~present ~~supplied~~the toresults afrom ~~Beneficial~~the ~~Shareholder~~2007 bythird ~~its~~quarter ~~broker~~at ~~(or~~4:30 ~~the~~PM ~~agent~~Eastern ofTime ~~the~~(1:30 PM ~~broker~~Pacific Time) is, ~~substantially~~Monday, ~~similar~~October 15, 2007. To listen to the ~~Instrument~~conference ofcall ~~Proxy~~live ~~provided~~by ~~directly~~telephone, dial to+1-800-319-4610 ~~registered~~for ~~shareholders~~participants byin North America or +1-604-638-5340 for Vancouver and ~~the~~international ~~Company.~~participants ~~However,~~approximately ~~its~~ten ~~purpose~~minutes before the call is ~~limited~~scheduled to ~~instructing~~begin. ~~the~~A telephone ~~registered~~playback ~~Shareholder~~will ~~(i.e.,~~be available beginning approximately one hour after the call. Dial ~~broker~~+1-800-319-6413 for North American callers or ~~agent~~+1-604-638-9010 for Vancouver and international callers. Enter access code 8337. A live and replay version of the ~~broker)~~webcast ~~how~~can tobe ~~vote~~accessed on ~~behalf~~the company’s ofinvestor ~~the~~website ~~Beneficial~~at ~~Shareholder~~www.osigeospatial.com.

InAbout ~~Canada~~OSI ~~the vast majority of brokers now delegate responsibility for obtaining instructions from~~Geospatial clients to ADP Investor Communications (“ADP”) and/or Computershare. ADP and Computershare typically prepare a machine-readable voting instruction form, mails those forms to Beneficial Shareholders and ask Beneficial Shareholders to return the forms to them, or otherwise communicate voting instructions by way of the Internet or telephone, for example. ADP and Computershare then tabulate the results of all instructions received and provide appropriate instructions respecting the voting of shares to be represented at the Meeting.

OSI Geospatial Inc. delivers advanced geospatial systems and software that enable shared real-time situational awareness for military, safety and security applications. Our products and services enable our customers to integrate and visualize live data with any combination of sensor data, imagery, maps and charts. This capability provides our customers with enhanced operational performance, safety and security through shared real-time situational awareness. OSI Geospatial systems and software are in use by military, government and commercial customers around the world. The company is publicly traded on the Toronto Stock Exchange (OSI) and the Over the Counter Bulletin Board (OSIIF). For additional information please visit www.osigeospatial.com.

ANews Beneficial Shareholder who receives an ADP or Computershare voting instruction form cannot use that form to vote common shares directly at the Meeting. The voting instruction forms must be returned to ADP or Computershare (or instructions respecting the voting of common shares must otherwise be communicated to ADP or Computershare) well in advance of the Meeting in order to have the common shares voted. If you have any questions respecting the voting of common shares held through a broker or other intermediary, please contact that broker or other intermediary for assistance. Release

~~Although~~Forward-Looking ~~a Beneficial Shareholder may not be recognized directly at the Meeting for the purposes of~~Statements voting common shares registered in the name of his broker, a Beneficial Shareholder may attend the Meeting as proxyholder for the registered shareholder and vote the common shares in that capacity. Beneficial Shareholders who wish to attend the Meeting and indirectly vote their common shares as proxyholder for the registered shareholder, should enter their own names in the blank space on the form of proxy provided to them and return the same to their broker (or the broker’s agent) in accordance with the instructions provided by such broker.

~~All~~Certain ~~references~~statements tomade ~~shareholders~~ in this ~~Information~~news ~~Circular~~release that are not based on historical information are forward-looking statements which are made pursuant to the safe harbor provisions of Section 21E of the Securities Exchange Act of 1934 and Section 138.4(9) of the ~~accompanying~~Ontario ~~form~~Securities Act. These forward-looking statements are subject to risks and uncertainties. Actual results may differ from these projections. The risks associated with the Company’s business include risks related to its reliance on international government contracts; the number of ~~proxy~~large customer transactions and the ~~Notice~~related lengthy sales cycles in executing those opportunities; uncertainties associated with competitive bidding processes and contract negotiations; actions by government authorities; the effects of ~~Meeting~~general ~~are~~economic and political conditions; changing foreign exchange rates; and challenges related to ~~registered~~the ~~shareholders~~company’s ~~unless~~ability ~~specifically~~to ~~stated~~introduce, ~~otherwise~~develop and implement new products and enhancements to existing products that respond to customer requirements in a changing, complex, technological market. A complete discussion of the company’s risk factors is presented in the company’s most recent annual reports, filed with the United States Securities and Exchange Commission (“SEC”) and the Canadian Securities Administrators (“CSA”), as well as other periodic reports filed with the SEC and the CSA. The Company does not undertake any obligation to update the forward-looking statements.

~~VOTING~~Copyright OF© ~~PROXIES~~2007 OSI Geospatial Inc. and its affiliated or related companies. ECPINS and COP-IDS are registered trademarks of Offshore Systems Ltd., an OSI Geospatial company. IGEN and C3CORE are registered trademarks of CHI Systems Inc., an OSI Geospatial company. Other company brand, product and service names are for identification purposes only and may be either trademarks, service marks or registered trademarks of their respective owners. Data subject to change without notice.

~~Every~~For ~~holder~~more ~~has~~information: Jane ~~the~~Hayward Investor ~~right to appoint some other person or company of their choice, who need not be~~Relations a+1 ~~holder,~~613 to287 ~~attend~~0462 ~~and act on their behalf at the meeting. If you wish to appoint a person~~ or ~~company~~ ~~other~~+1 ~~than~~888 ~~the~~880 ~~persons whose names are printed herein, please insert the name of your~~9797 ~~chosen~~+1 ~~proxyholder~~613 in287 ~~the~~0466 ~~space provided~~(FAX) invest@osigeospatial.com

If the securities are registered in the name of more than one owner (for example, joint ownership, trustees, executors, etc.), then all those registered should sign this proxy. If you are voting on behalf of a corporation or another individual you may be required to provide documentation evidencing your power to sign this proxy with signing capacity stated.

This proxy should be signed in the exact manner as the name appears on the proxy.

If this proxy is not dated, it will be deemed to bear the date on which it is mailed by management to the holder.

THE SECURITIES REPRESENTED BY THIS PROXY WILL BE VOTED AS DIRECTED BY THE HOLDER, HOWEVER, IF SUCH A DIRECTION IS NOT MADE IN RESPECT OF ANY MATTER, THIS PROXY WILL BE VOTED AS RECOMMENDED BY MANAGEMENT.

The securities represented by this proxy will be voted or withheld from voting, in accordance with the instructions of the holder, on any ballot that may be called for and, if the holder has specified a choice with respect to any matter to be acted on, the securities will be voted accordingly.

This proxy confers discretionary authority in respect of amendments to matters identified in the Notice of Meeting or other matters that may properly come before the meeting.

This proxy should be read in conjunction with the accompanying documentation provided by management.

~~VOTING~~OSI INGeospatial ~~PERSON~~ Inc. Consolidated Balance Sheets News Release

Any shareholder attending the Meeting to vote personally or as proxyholder for another shareholder shall be required to produce identification satisfactory to the Chair of the Meeting establishing his or her identity.


In thousands of U.S. dollars	August 31, 2007			November 30, 2006

Assets

Current assets
Cash	$	202		$	—
Accounts receivable		10,425			12,707
Income taxes recoverable		173			28
Inventory		1,336			1,063
Prepaid expenses and deposits		549			535
Current portion of future income tax asset		90			—


		12,775			14,333

Future income tax asset		49			—

Equipment and furnishings		1,690			1,089
Intangible and other assets		698			794
Goodwill		8,330			8,129


	$	23,542		$	24,345


Liabilities

Current liabilities
Bank indebtedness	$	—		$	904
Accounts payable and accrued liabilities		4,011			4,887
Income taxes payable		54			86
Unearned revenue		452			667
Current portion of deferred rent		36			—
Current portion of future income tax liability		17			—


		4,570			6,544

Deferred rent		342			—
Future income tax liability		83			20

		4,995			6,564


Shareholders’ Equity

Issued and outstanding
30,262 Class A Series A preference shares (November 30, 2006 – 30,262)		19			19
190,670 Class B, Series 2 preference shares (November 30, 2006 – 279,840)		4,850			7,115
46,242,326 common shares (November 30, 2006 – 35,137,046)		21,058			15,887


		25,927			23,021
Warrants		4,618			4,286
Contributed surplus		1,562			1,343
Accumulated deficit		(15,806	)		(13,296	)
Accumulated other comprehensive income		2,246			2,427


		18,547			17,781


	$	23,542		$	24,345

INTEREST OF CERTAIN PERSONS OR COMPANIES IN MATTERS TO BE ACTED UPON

None of the directors or senior officers of the Company, nor any person who has held such a position since the beginning of the last completed financial year of the Company, nor any proposed nominee for election as a director of the Company, nor any associate or affiliate of the foregoing persons, has any substantial or material interest, direct or indirect, by way of beneficial ownership of securities or otherwise, in any matter to be acted on at the Meeting other than the election of directors.

VOTING SECURITIES AND PRINCIPAL HOLDERS OF VOTING SECURITIES

As of March 14, 2007, the Company had 36,858,810 common shares without par value, 30,262 Class A Preference Shares Series A Convertible and 250,570 Class B Series 2 Convertible Preference Shares issued and outstanding.

The holders of common shares, Class A Preference Series A Convertible Shares (“Class “A”, Series A Shares”) and Class B Series 2 Convertible Preference Shares (“Class “B” Series 2 Shares”) are entitled to receive notice of and to attend and vote at any meetings of the shareholders of the Company.

Only shareholders of record at the close of business on March 14, 2007 (the “Record Date”) who either personally attend the Meeting or who have completed and delivered a form of proxy in the manner and subject to the provisions described above shall be entitled to vote or to have their shares voted at the Meeting.

To the knowledge of the directors and senior officers of the Company no person holds, directly or indirectly, shares carrying more than 10% of the voting rights attached to all classes of voting shares of the Company.

ELECTION OF DIRECTORS

Management of the Company proposes that the number of directors for the ensuing year be fixed at seven. Shareholders will therefore be asked to approve an ordinary resolution that the number of directors elected be fixed at seven. Management intends to nominate the persons named in the following table for election as directors of the Company. Each of management’s nominees currently serves as a director of the Company. Each director elected will hold office until the next annual general meeting or until his successor is duly elected or appointed, unless his office is earlier vacated in accordance with the Articles of the Company or he becomes disqualified to act as a director. In fiscal 2006 the Company had an Audit Committee, a Human Resources and Compensation Committee, and an Executive Committee. The members of such committees are indicated below.

The following information concerning the proposed nominees has been furnished by each of them:

			No. of Shares
			Beneficially Owned,
Name and Present	Principal Occupation for the		Controlled or
Position in the Company	Past Five Years	Director Since	Directed(1)
RAYMOND W. JOHNSTON Chair of the Board & Director(3)(4)	President of Chamber of Maritime Commerce, December 1999 to present; CEO, Canada Steamship Lines, May 1992 to June 1999.	November 14, 2000 (and from December 21, 1994 to September 28, 1998)	54,000 common shares
KENNETH KIRKPATRICK President, Chief Executive Officer & Director(3)	President and CEO of the Company, November 7, 2005 to present; COO of the Company, June 2001 to November 2005.	November 7, 2005	55,500 common shares
HELMUT F. LOBMEIER Director(2)	Independent Businessman and formerly co-owner of PSL Steel Ltd.	April 26, 1990	731,695 common shares
CAPTAIN WALTER P. PURIO Director(4)	Independent Marine Consultant, 2000 to present; President, P and H Marine Associates, Inc., 1993 to 2000; Shipmaster — Oceans, General Dynamics, American Overseas Marine Corporation, 1985 to present.	January 14, 1999	133,000 common shares
GERALD J. SHIELDS Director	Principal of Providia Investment November, 2006 to present; Lawyer engaged in private practice with the firms of Godinho Sinclair Shields, and from July 2005 to November 2006 with Clark Wilson LLP.	April 8, 2005	50,000 common shares
JOSEPH A. STROUD Director(2)(3)	Partner at General Management Partners LLC, 2005 to present; Consultant at J.J. Lehman Equity Investors I, LP, 1997 to present.	March 15, 2006	100,000 common shares
DONALD W. YOUNG(2) (3) Director	Retired, October 2005 to present; Audit Partner KPMG LLP 1979 to September 2005.	March 15, 2006	50,000 common shares


OSI Geospatial Inc. Consolidated Statements of Operations		News Release

NOTES:


	Three months ended August 31,						Nine months ended August 31,
In thousands of U.S. dollars, except share related data	2007			2006			2007			2006

Revenue
Marine systems	$	3,124		$	1,240		$	6,267		$	4,958
Land and air systems		2,627			2,022			7,294			6,244
Mapping		1,591			1,054			3,489			2,917

		7,342			4,316			17,050			14,119

Cost of sales		4,294			2,913			10,878			8,927


Gross profit		3,048			1,403			6,172			5,192


Expenses
General and administrative		1,451			1,460			4,249			4,320
Engineering		231			389			1,101			1,382
Sales and marketing		755			510			2,252			1,668
Depreciation and amortization		75			142			220			412
Interest expense		22			3			48			15
Interest income		—			—			(7	)		(20	)
Foreign exchange loss (gain)		43			(18	)		65			(18	)
Loss on sale of fixed assets		—			2			—			2
Technology Partnerships Canada royalty		139			55			276			220
Technology Partnerships Canada contribution		—			(227	)		—			(731	)


		2,716			2,316			8,204			7,250


Net earnings (loss) before income taxes		332			(913	)		(2,032	)		(2,058	)


Future income tax recovery		(10	)		(117	)		(59	)		(140	)
Current income tax expense (recovery)		63			(87	)		103			(65	)


Income tax expense		53			(204	)		44			(205	)


Net earnings (loss)	$	279		$	(709	)	$	(2,076	)	$	(1,853	)


Net earnings (loss) available to common shareholders	$	109		$	(972	)	$	(2,628	)	$	(2,642	)


Earnings (loss) per share - basic and diluted	$	0.00		$	(0.03	)	$	(0.07	)	$	(0.08	)

Weighted average number of common shares outstanding – basic and diluted		42,377,958			32,891,635			39,635,112			32,160,508

(1)		The approximate number of shares of the Company carrying the right to vote in all circumstances beneficially owned, directly or indirectly, or over which control or direction is exercised by each proposed nominee as of the date of this Information Circular.
(2)		Member of Audit Committee.
(3)		Member of Executive Committee.
(4)		Member of Human Resources and Compensation Committee.

All of the above persons are ordinarily resident in Canada except Messrs. Purio and Stroud, who are ordinarily resident in Australia and the United States of America respectively.

~~STATEMENT~~OSI OFGeospatial ~~EXECUTIVE~~Inc. ~~COMPENSATION~~ Consolidated Statements of Cash Flows News Release

Executive Compensation


	Three Months ended August 31,						Nine months ended August 31,
In thousands of U.S. dollars	2007			2006			2007			2006

Cash flows from (used in) operating activities
Net earnings (loss) for the period	$	279		$	(709	)	$	(2,076	)	$	(1,853	)
Items not affecting cash
Depreciation and amortization		129			191			377			580
Stock-based compensation		5			—			145			104
Future income taxes		(83	)		(116	)		(177	)		(73	)


		330			(634	)		(1,731	)		(1,309	)


Changes in non-cash working capital items
Accounts receivable		(2,644	)		690			2,504			4,326
Inventory		96			(190	)		(155	)		(300	)
Prepaid expenses and deposits		75			(151	)		36			(59	)
Accounts payable and accrued liabilities		367			(167	)		(1,381	)		(1,387	)
Income taxes payable		87			(85	)		(143	)		(256	)
Unearned revenue		(57	)		12			(330	)		390
Deferred rent		363			—			363			—


		(1,713	)		109			894			2,714


		(1,383	)		(525	)		(837	)		1,405


Cash flows from (used in) investing activities
Purchase of CHI Systems Inc., net of cash acquired		—			(4	)		—			(8,127	)
Purchase of Liddy International Inc.		—			—			(25	)		—
Decrease (increase) in marketable securities		—			16			—			(143	)
Decrease in restricted cash		—			—			—			129
Additions to equipment and furnishings		(111	)		—			(225	)		(83	)
Additions to leasehold improvements		(540	)					(540	)
Additions to intangibles and other assets		—			(12	)		(31	)		(109	)


		(651	)		—			(821	)		(8,333	)


Cash flows from (used in) financing activities

Payments to operating line of credit		(548	)		—			(904	)		—
Issue of common shares		2,812			53			2,812			59
Issue of warrants		332			—			332			—
Class B preference share dividends		(382	)		—			(382	)		(527	)


		2,214			53			1,858			(468	)


Effect of foreign exchange on cash		22			(34	)		2			87


Increase (decrease) in cash		202			(506	)		202			(7,309	)

Cash – beginning of period		—			1,419			—			8,222


Cash – end of period	$	202		$	913		$	202		$	913

The table below sets out particulars of compensation paid to Named Executive Officers the following Executive Officers for services to the Company during the three most recently completed financial years. The following executive officers are “Named Executive Officers”:

(a) the Company’s chief executive officer (“CEO”) during the most recently completed financial year; (b) the individual who served as our chief financial officer or acted in a similar capacity (“CFO”) during the most recently completed financial year; (c) each of our three most highly compensated executive officers, other than the CEO and CFO, who was serving as an executive officer at the end of the most recently completed financial year and whose total salary and bonus exceeded $150,000 per year; and (d) any additional individuals for whom disclosure would have been provided except that the individual was not serving as an executive officer of the Company at the end of the most recently completed financial year.

The following are the Company’s Named Executive Officers for the purposes of the following disclosure: Kenneth Kirkpatrick (President and CEO), John Sentjens (Vice President, Finance), Andrew Carniel (Vice President, Business Development, Wayne Zachary (Vice President & GM of U.S. Systems Operations) and Wayne Hoyle (Vice President & GM of International Systems Operations).

Summary Compensation Table

The following sets forth compensation for the Company’s Named Executive Officers for the fiscal years indicated:

ANNUAL COMPENSATION

LONG-TERM COMPENSATION

AWARDS

PAYOUT

Restricted

Securities

Shares or

Under

Restricted

Other

Options

LTIP

All

Name

Year

Salary

`Bonus

Annual

Granted

Units

Payouts

Other

($)

(#)

($)

Kenneth H. Kirkpatrick President and CEO(1)

2006 2005 2004

$249,909 $156,461 $138,269

$78,000 $22,500 $10,000

$9,423 $6,154 $5,385

Nil 288,333 45,000

Nil Nil Nil

John T. Sentjens VP Finance and Secretary

2006 2005 2004

$131,731 $108,230 $97,923

$39,000 $15,000 7,500

Nil Nil Nil

Nil 222,000 18,000

Nil Nil Nil

Andrew Carniel VP Business Development

2006 2005 2004

$165,961 $140,000 $138,269

33,000 $7,500 $10,000

$6,006 Nil $1,679

Nil 188,333 45,000

Nil Nil Nil

ANNUAL COMPENSATION

LONG-TERM COMPENSATION

AWARDS

PAYOUT

Restricted

Securities

Shares or

Under

Restricted

Other

Options

LTIP

All

Name

Year

Salary

`Bonus

Annual

Granted

Units

Payouts

Other

($)

(#)

($)

Wayne Zachary VP & GM of U.S. Systems Operations(2)

2006 2005 2004

$161,783 — —

$34,053 — —

$8,175 — —

Nil — —

Nil Nil —

Nil — —

Wayne Hoyle VP & GM of International Systems Operations(3)

2006 2005 2004

$126,923 $105,092 $89,009

Nil Nil Nil

$58,218 $63,671 $96,477

Nil 45,000 Nil

Nil Nil Nil

MANAGEMENT’S DISCUSSION AND ANALYSIS

~~NOTES:~~for the three and nine months ended August 31, 2007

(1)		Mr. Kirkpatrick was promoted from COO to President and CEO on November 7, 2005.
(2)		Mr. Zachary joined the organization on December 15, 2005 through its acquisition of CHI Systems.
(3)		Mr. Hoyle’s remuneration arrangement includes compensation paid under a commission arrangement tied to the closing of sales. The above figures include variable compensation paid to him under this arrangement of $58,218 (fiscal 2006) $63,671 (fiscal 2005) and $96,477 (fiscal 2004).

OSI Geospatial Inc.
300-340 March Road
Kanata, ON K2K 2E4
Tel: 613.287.0462
Fax: 613.287.0466
www.osigeospatial.com

~~Long-Term~~OSI ~~Incentive~~Geospatial ~~Plans~~Inc. Management’s —Discussion ~~Awards~~and inAnalysis For ~~Financial~~the ~~Year~~three ~~Ended~~and ~~November~~nine months ended August 3031, ~~2006~~2007 (expressed in U.S. dollars)

~~The~~MANAGEMENT’S ~~Company~~DISCUSSION ~~has~~AND noANALYSIS ~~long-term~~of ~~incentive~~Financial ~~plans~~Condition inand ~~place.~~Results Aof ~~“Long-Term Incentive Plan” is a plan under~~Operations ~~which awards are made based on performance over a period longer than one financial year, other than a plan for options, SARs (stock appreciation rights) or restricted share compensation.~~

~~Stock~~The ~~Option~~following ~~Grants~~discussion ~~During~~and analysis provides a review of activities, results of operations, and financial condition of OSI Geospatial Inc. for the ~~Financial~~three ~~Year~~and ~~Ended~~nine months ended August 31, 2007 in comparison with those for the nine months ended August 31, 2006. The following discussion should be read in conjunction with our unaudited interim consolidated financial statements prepared in accordance with generally accepted accounting principles in Canada (“Canadian GAAP”), including the notes thereto, for the three and nine months ended August 31, 2007, and the audited annual consolidated financial statements for the year ended November 30, 2006 prepared in accordance United States generally accepted accounting principles (“U.S. GAAP”). These previously released financial statements include a reconciliation to Canadian GAAP in Note 21. The following discussion should also be read in conjunction with Management’s Discussion and Analysis prepared for the year ended November 30, 2006.

~~The~~Effective ~~following~~March 1, ~~table~~2006, ~~sets~~we ~~forth~~adopted ~~grants~~the ofU.S. ~~stock~~dollar ~~options~~as ~~during~~our ~~the~~reporting ~~2006~~currency. ~~fiscal~~All ~~year~~references in this report to ~~the~~financial ~~Named~~information concerning OSI Geospatial Inc. are in accordance with Canadian ~~Executive~~GAAP ~~Officers:~~and all dollar amounts are in U.S. dollars unless otherwise indicated.

~~Market~~Beginning ~~Value~~in ~~Total~~the ~~Options~~first Ofquarter ~~Securities~~of ~~Granted~~fiscal to2006, ~~Underlying~~we ~~Securities~~have ~~Under~~changed ~~Employees~~our infinancial ~~Exercise~~reporting orsegments ~~Options~~in order onto ~~the~~reflect ~~Name~~changes ~~Options~~in ~~Granted~~management’s ~~Financial~~analysis ~~Year~~of ~~Base~~our ~~price~~business. ~~Date~~Our ofconsolidated ~~Grant~~revenue categories ~~Expiration~~have ~~Date~~changed ~~(#)~~to ~~(%)~~marine ~~($/Security)~~systems, ~~($/Security)~~land ~~Kenneth~~and H.air ~~Kirkpatrick~~systems, ~~President~~and mapping and ~~CEO~~our ~~Nil~~reportable segments ~~Nil~~are ~~Nil~~now ~~Nil~~U.S. ~~Nil~~Systems ~~John~~Operations, T.International ~~Sentjens~~Systems VPOperations, ~~Finance~~Mapping Operations, and Corporate ~~Secretary~~and ~~Nil~~Public ~~Nil~~Company ~~Nil~~costs. ~~Nil~~On ~~Nil~~April 12, ~~Andrew~~2006 ~~Carniel~~at VPthe ~~Business~~Company’s ~~Development~~annual ~~Nil~~general ~~Nil~~meeting, ~~Nil~~its shareholders ~~Nil~~voted ~~Nil~~in ~~Wayne~~favor ~~Zachary~~of VPchanging &the GMCompany’s ofname ~~U.S.~~from Offshore Systems ~~Operations~~International ~~Nil~~Ltd. to ~~Nil~~OSI ~~Nil~~Geospatial ~~Nil~~Inc. ~~Nil~~The ~~Wayne~~name ~~Hoyle~~change VPwas &effective GMJune 5, 2006. For the purposes of ~~International~~this report, ~~Systems~~the ~~Operations~~Company ~~Nil~~is ~~Nil~~referred ~~Nil~~to ~~Nil~~by ~~Nil~~its new legal identity.

8This report contains forward-looking statements within the meaning of securities laws including Section 27a of the Securities Act of 1933, as amended, and Section 21e of the Securities Exchange Act of 1934, as amended, including statements regarding the future achievement of corporate objectives, advancement of additional project interests, analysis and development of acquisition opportunities, various project interests and other matters. These statements are neither promises nor guarantees, but involve known and unknown risks and uncertainties that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed in or implied by these forward-looking statements. These risks include risks related to the effects of general economic conditions, changing foreign exchange rates, actions by government authorities, uncertainties associated with contract negotiations, and industry supply, as well as other factors discussed below and those risks which are discussed under the heading “Risks and Uncertainties”. Readers should not place undue reliance on any such forward-looking statements, which speak only as of the date they were made. We disclaim any obligation to publicly update or revise any such statements to reflect any change in our expectations or in events, conditions or circumstances on which any such statements may be based, or that may affect the likelihood that actual results will differ form those set forth in the forward-looking statements, except as required by law.

~~Aggregated~~ECPINS ~~Stock~~and ~~Option~~COP-IDS ~~Exercises~~are ~~During~~registered ~~the~~trademarks ~~Financial~~of ~~Year~~Offshore ~~Ended~~Systems ~~November 30~~Ltd., ~~2006~~an OSI Geospatial company. Other company brand, product and ~~Financial~~service ~~Year-End~~names ~~Option~~are ~~Values~~for identification purposes only and may be either trademarks, service marks or registered trademarks of their respective owners. Data is subject to change without notice.

				Value of Unexercised
			Unexercised Options	in-the-money Options
	Securities Acquired	Aggregate Value	at FY-End (#)	at FY-End ($)
Name	on Exercise (#)	Realized ($)	Exercisable/Unexercisable	Exercisable/Unexercisable
Kenneth H. Kirkpatrick President and CEO	Nil	$Nil	350,000 exercisable Nil unexercisable	Nil exercisable Nil unexercisable
John T. Sentjens VP Finance and Secretary	Nil	$Nil	250,000 exercisable Nil unexercisable	Nil exercisable Nil unexercisable
Andrew Carniel VP Business Development	Nil	$Nil	250,000 exercisable Nil unexercisable	Nil exercisable Nil unexercisable
Wayne Zachary VP & GM of U.S. Systems Operations	Nil	$Nil	100,000 exercisable Nil unexercisable	Nil exercisable Nil unexercisable
Wayne Hoyle VP & GM of International Systems Operations	Nil	$Nil	45,000 exercisable Nil unexercisable	Nil exercisable Nil unexercisable

Additional information relating to OSI Geospatial, including our Annual Information Form and our Form 20-F report is filed on SEDAR at www.sedar.com, on EDGAR at www.sec.gov, and is also available on the company’s investor web site at www.osigeospatial.com.

~~Stock~~This ~~Option~~management’s discussion and ~~SAR~~analysis ~~Repricings~~is dated October 10, 2007.

~~During~~Page ~~the~~2 ~~most~~of ~~recently completed financial year, the Company did not reprice downward any stock~~18 ~~options held by any Named Executive Officer. The Company does not have any SARs.~~

~~Defined~~OSI ~~Benefit~~Geospatial orInc. Management’s ~~Actuarial~~Discussion ~~Plan~~and Analysis For the three and nine months ended August 31, 2007 (expressed in U.S. dollars)

~~The~~© ~~Company~~2007 ~~does~~OSI ~~not~~Geospatial ~~have~~Inc. aand ~~pension~~its ~~plan~~affiliated or ~~actuarial~~related ~~plan under which benefits are determined primarily by final compensation (or average final compensation)~~companies.

~~Termination of Employment, Change in Responsibilities and Employment Contracts~~Overview

~~The~~Founded ~~following~~in is1977 aand ~~summary~~headquartered ofin Ottawa, Ontario, Canada, the ~~material~~Company ~~terms~~designs, develops and markets ~~conditions~~the proprietary ECPINSÒ line of ~~the~~electronic ~~employment~~chart ~~contracts~~navigation ~~between~~systems for commercial and military customers. ECPINSÒ helps to reduce the ~~Company~~risk of navigation-related incidents by giving bridge crews a precise, real-time display of their position, course and ~~each~~speed, against a background of fixed obstacles and other navigational hazards. The Company has developed a strong market position in military navigation, and has ECPINSÒ systems deployed with the ~~Named~~Canadian and ~~Executive~~United ~~Officers~~States asCoast ofGuards, the ~~Company’s~~Canadian ~~financial~~Navy, ~~year~~the ~~ended~~Royal New Zealand Navy, the Royal Danish ~~November 30~~Navy, ~~2006~~the Royal Australian Navy, the Royal Navy of the United Kingdom and the United States Navy.

~~Kenneth Kirkpatrick serves as President and CEO pursuant to an employment contract dated November 7, 2005.~~ The ~~employment contract is for no fixed term. The contract may be terminated by the~~ Company ~~at any time for cause, and at any time without cause upon 18 months notice or payment of 18 months base salary in lieu of notice. Mr. Kirkpatrick~~’s ~~current~~growth ~~base~~strategy ~~salary under the contract~~ is ~~$245,000.~~ Hebuilt ~~is also eligible to receive stock options as well as cash bonuses at the discretion of the Board of Directors, based~~ on ~~the~~four ~~Company~~fronts ~~meeting~~– ~~certain~~diversifying ~~performance~~its ~~objectives (subject to a maximum of 40% of his base salary). In addition~~technology, ~~Mr. Kirkpatrick is eligible to participate in a~~partnering ~~plan~~with ~~offered to all employees whereby~~ the Company will pay a maximum of 4% of his base salary earned during the year to a designated registered retirement savings plan provided that he matches such payment. The employment contract provides that in the event of a change of control of the Companybest, ~~that~~building ~~the~~on ~~Company~~its iscustomer ~~taken~~relationships ~~over~~and bycompleting aacquisitions ~~third~~complimentary ~~party, Mr. Kirkpatrick may at his option terminate the contract, in which event he is entitled~~ to ~~a severance payment equal to 18 months~~ ~~base~~its ~~salary~~existing ~~The~~lines ~~employment contract also includes provisions in favor~~ of ~~the Company related to the confidentiality, proprietary rights and intellectual property, and non-competition and non-solicitation of employees and customers of the Company~~business.

~~John~~In ~~Sentjens~~diversifying ~~serves~~its technology, the Company will lever its market and technology position as ~~Vice~~a leader ~~President,~~in ~~Finance~~the ~~pursuant~~naval surface and subsurface navigation market to anaccess ~~employment~~adjacent ~~contract~~markets. ~~dated~~Building on ~~November~~its ECPINSÒ line of electronic chart navigation systems for commercial and military 14customers, ~~2005.~~the ~~The~~Company ~~employment~~has ~~contract~~expanded isinto ~~for~~the noCommand ~~fixed~~& ~~term~~Control (C2) and homeland security markets through the development of applications like the Common Operational Picture product line (COP-PL), Warship Automatic Identification System (W-AIS) and the C2 product line C3CORE. ~~The~~Also, ~~contract~~the ~~may~~Company has beexpanded ~~terminated~~its byproduct offerings in the commercial market with the introduction of its simplified voyage data recorder (S-VDR) product, the integrated ECPINS®/S-VDR 5000 system.

9The Company continues to partner with the best using its technology dominance in the military navigation market to gain entry into major defence programs. We currently have partnering agreements with Terma A/S in Denmark, Lockheed Martin in the U.S. and the U.K. and, Raytheon, L3 Communications, General Dynamics and Northrop Grumman in the U.S.

The Company atcontinues ~~any~~to ~~time~~build ~~for~~on ~~cause,~~its ~~and~~current atcustomer ~~any time without cause upon 12 months notice or payment of 12 months~~ base ~~salary~~by inlevering ~~lieu of notice. Mr. Sentjens’ current base salary under~~ the ~~contract~~strong iscustomer ~~$150,000.~~relationships Heit ishas ~~also~~developed ~~eligible~~through ~~to receive stock options as well as cash bonuses at~~ the ~~discretion~~successful ~~of the~~execution ~~Board~~ of ~~Directors,~~major ~~based~~projects. onWe ~~the~~have ~~Company meeting certain performance objectives (to a maximum~~existing ofcustomers ~~30% of his base salary). In addition, Mr. Sentjens is eligible to participate~~ in ~~a plan offered to all employees whereby~~ the ~~Company~~military ~~will~~agencies ~~pay a maximum~~ of 4%Canada, ~~of his base salary earned during the year to a designated registered retirement savings plan provided that he matches such payment~~U.S., ~~The employment~~European ~~contract~~NATO ~~also~~and ~~includes~~other ~~provisions~~allies ~~in favor~~ of ~~the Company related to the confidentiality~~Canada, ~~proprietary rights~~ and ~~intellectual property, and non-competition and~~ ~~non-solicitation~~national ~~of employees~~ and ~~customers~~international ofcommercial ~~the~~marine ~~Company~~transportation companies.

~~Andrew~~The ~~Carniel~~Company ~~serves~~has ascompleted ~~Vice-President,~~acquisitions ~~Business~~complimentary ~~Development~~to ~~pursuant~~its existing businesses to angain ~~employment~~access ~~contract~~to ~~dated~~key ~~November 14~~markets, ~~2005,~~build ascritical ~~amended.~~mass ~~The~~and ~~employment~~expand ~~contract~~its isproducts ~~for~~and ~~no fixed term~~markets. ~~The~~In ~~contract~~April 2005, ~~may be terminated by~~ the Company completed atthe ~~any~~acquisition ~~time~~of ~~for~~all ~~cause,~~the ~~and~~outstanding atshares ~~any~~of ~~time~~Mapcon ~~without~~Mapping ~~cause~~Consultants ~~upon~~Inc. ~~12 months~~(Mapcon) ~~notice~~of inSalt ~~writing~~Lake orCity, ~~payment~~Utah offor ~~severance~~$1.1 million. ~~equal~~Mapcon tois ~~12 months~~a ~~base~~land ~~salary~~mapping company in ~~lieu~~the ~~of notice~~U. MrS. geomatics ~~Carniel’s~~(digital ~~current~~map ~~base~~and ~~salary~~electronic ~~under~~chart ~~the~~data ~~contract~~production) ismarket. ~~$165~~In December 2005,~~000.~~ Hethe isCompany ~~also~~completed the ~~eligible~~acquisition toof ~~receive~~CHI ~~stock options~~Systems asInc., ~~well~~a asUnited ~~cash~~States ~~bonuses~~defence atcontracting ~~the~~company ~~discretion~~for of$9 million. CHI ~~the~~has ~~Board~~three ofoffices ~~Directors~~in the United States, ~~based~~is ona ~~the~~supplier ~~Company meeting~~of ~~certain~~technology ~~performance~~and ~~objectives~~services (to athe ~~maximum~~U.S. Department of ~~30%~~Defence ofand ~~his~~key ~~base~~defence ~~salary~~prime contractors. InCHI ~~addition~~has developed C2, ~~Mr.~~training simulation ~~Carniel~~and iscognitive ~~eligible~~agent applications to ~~participate~~support inits acustomers ~~plan~~in ~~offered~~multiple toU.S. ~~all~~military ~~employees~~agencies. ~~whereby~~In April 2007, the Company ~~will~~through ~~pay a~~its ~~maximum~~subsidiary ofCHI 4%Systems ofInc., ~~his~~acquired ~~base~~the ~~salary~~assets ~~earned~~of ~~during~~Liddy International ~~the~~Inc. ~~year~~(“Liddy”), to a ~~designated~~United ~~registered~~States ~~retirement savings~~defense ~~plan~~contracting ~~provided~~company ~~that~~and heestablished ~~matches~~Layered Security ~~such~~Solutions ~~payment~~(“LSS”). ~~The~~LSS ~~employment~~provides ~~contract~~business ~~also~~continuity ~~includes provisions~~solutions inagainst ~~favor~~all ofhazards ~~the~~and ~~Company~~is qualified ~~related~~ to ~~the~~develop ~~confidentiality~~deterrence, ~~proprietary~~response ~~rights~~ and ~~intellectual~~ ~~property,~~recovery ~~and~~strategies ~~non-competition~~designed ~~and~~to ~~non-solicitation~~deal ofwith ~~employees~~global threats ~~and~~to ~~customers~~business ofand ~~the Company~~government.

~~Wayne~~Page ~~Zachary serves as Vice President & General Manager of OSI’s U.S. Systems Operations pursuant to an employment contract dated December 14, 2005. The employment contract is for a~~ 3 ~~year~~ fixed term, subject to earlier termination, with the option to extend for successive 1 year periods. The contract may be terminated by the Company at any time for cause, and at any time without cause upon the continuation of ~~base salary for a period of 12 months following termination. Mr. Zachary’s~~18 current base salary under the contract is US$200,000. He is also eligible to receive stock options at the discretion of the Board of Directors as well as cash bonuses based on the Company meeting certain performance objectives (to a maximum of 40% of his base salary). In addition, Mr. Zachary is entitled to a company leased or owned automobile with an MSRP not to exceed $30,000 during 2006. The employment contract also includes provisions in favor of the Company related to the confidentiality, proprietary rights and intellectual property, and non-competition and non-solicitation of employees and customers of the Company.

~~Wayne Hoyle serves as Vice President & General Manager of~~ OSI’s ~~International~~Geospatial ~~Systems Operations pursuant to an employment contract dated July 17, 2006~~Inc. ~~The employment contract is for no fixed~~ ~~term. The contract may be terminated by the Company at any time for cause, and at any time without cause upon 12 months notice or payment of 12 months base salary in lieu of notice. Mr. Hoyle~~Management’s ~~current~~ ~~base~~Discussion ~~salary under the contract is $165,000~~ and ~~he is eligible to receive stock options at~~Analysis ~~the~~For ~~discretion of~~ the ~~Board~~three ofand ~~Directors.~~nine Upmonths ~~until~~ended ~~November~~August 3031, ~~2006, Mr. Hoyle is also eligible to receive cash commissions on the gross sales of the Navigation Systems business unit. Those commissions totaled $58,217.66 for fiscal 2006. Starting fiscal~~ 2007~~, Mr. Hoyle will no longer be~~ ~~eligible for commissions; he will be eligible for cash bonuses at the discretion of the Board of Directors based on the Company meeting certain performance objectives~~ (toexpressed ain ~~maximum of 30% of his base salary)~~U. ~~In addition, Mr~~S. ~~Hoyle~~ ~~is eligible to participate in a plan offered to all employees~~dollars) ~~whereby the Company will pay a maximum of 4% of his base salary earned during the year to a~~ designated registered retirement savings plan provided that he matches such payment. The employment contract also includes provisions in favor of the Company related to the confidentiality, proprietary rights and intellectual property, and non-competition and non-solicitation of employees and customers of the Company.

10SELECTED DATA

~~Composition~~The offollowing tables contain financial information that is derived from the ~~Human~~unaudited ~~Resources~~interim consolidated ~~and~~financial ~~Compensation~~statements ~~Committee~~for the nine months ended August 31, 2007.

The members of the Human Resources and Compensation Committee were Brint Coxe, Walter Purio, and Raymond Johnston, all of whom served on the Committee throughout the financial year ended November 30, 2006. All of the members of the Committee are independent directors, have no indebtedness to the Company and have no interest in any material transactions with the Company.


Operations:	For the nine months ended August 31
In thousands of U.S. dollars except share related data	2007			2006
	$			$

Revenue		17,050			14,119
Gross profit		6,172			5,192
Gross profit percentage		36%			37%
Net loss		(2,076	)		(1,853	)
Net loss attributable to common shareholders		(2,628	)		(2,642	)

Loss per share – basic and diluted		(0.07	)		(0.08	)
Weighted average common shares outstanding – basic and diluted		39,635,112			32,160,508

~~REPORT~~Our ONquarterly ~~EXECUTIVE~~and ~~COMPENSATION~~year-to-date results are primarily influenced by the level, timing, and duration of customer orders, and customer product delivery requirements. We depend heavily on government contracts and derive a significant amount of revenue from a few customers, which may result in varying revenue, gross profit, and earnings. Some of our government customers have cyclical purchasing patterns which can also impact our quarterly and year-to date results.

The ~~Company’s~~slightly ~~compensation~~lower ~~policies~~gross ~~are~~profit ~~designed~~percentage for the nine months ended August 31, 2007 as compared to the ~~recognize~~nine ~~and~~months ~~reward~~ended August 31, 2006 is largely due to the ~~services~~mix of ~~highly~~revenue. There was less software ~~skilled~~revenue ~~executives,~~and asmore ~~well~~systems asand ~~provide~~services ~~compensation~~revenue ~~packages,~~in ~~with~~the ~~incentives~~nine months ended August 31, ~~commensurate~~2007 ~~with~~than in the ~~industry~~nine ~~standards~~months ended August 31, 2006.

~~Compensation~~Fluctuations ~~packages~~in ~~reflect~~gross ~~responsibilities~~profit ~~and the marketplace and~~ are ~~designed~~influenced toby ~~be competitive~~the ~~with~~proportion ~~(i) that~~ of ~~other~~engineering ~~publicly~~labor, ~~traded companies involved in industries similar to that~~third-party ofsystems ~~the~~or ~~Company~~third-party ~~and~~labor ~~(ii) other~~or ~~publicly~~portions ~~traded companies~~ of ~~comparable~~all ~~size~~three inrequired ~~terms~~for ofa ~~revenue. In addition~~project, ~~the~~and ~~Company~~a ~~has~~high ~~analyzed~~proportion of ~~compensation~~these ~~surveys~~factors ~~and~~can ~~studies~~result toin ~~compare~~increased ~~the~~cost ~~compensation packages~~of tosales ~~generally~~and ~~accepted~~therefore ~~practices~~lower ~~for~~gross ~~publicly traded companies~~profit. ~~The~~Certain contracts ~~major~~awarded ~~elements~~may ofrequire the ~~executive~~ ~~compensation~~inclusion ~~packages consist~~ of ~~base~~engineering ~~salary~~labor, ~~annual performance~~third-~~based~~party ~~cash~~systems ~~incentives,~~or ~~incentive~~third-party ~~stock options and a registered retirement savings plan contribution matching program~~labor. ~~The Human~~In ~~Resources~~order ~~and Compensation Committee (the “Committee”) has the responsibility~~ to ~~annually review~~maintain ~~and~~competitiveness ~~recommend~~on ~~for~~these ~~approval by the Board~~contracts, ~~corporate~~we ~~goals~~may ~~and~~elect ~~objectives relevant~~ to ~~the~~reduce ~~CEO’s~~our ~~compensation~~usual ~~package,~~margins ~~as well as review and approve the CEO’s compensation based~~ on the ~~Committee’s~~ ~~evaluation~~third-party ~~of the CEO’s performance~~components. ~~The~~In ~~Committee~~addition, isthe ~~also~~product ~~responsible~~mix toof ~~review~~services revenue, ~~evaluate~~software, ~~and recommend compensation packages for (i) the directors of the Board~~mapping, ~~including~~and ~~the Chair~~systems ofand ~~the~~systems ~~Board~~components ~~(ii) each~~in ~~executive~~any ~~officer~~given ~~who~~period ~~reports~~may toimpact the ~~CEO, and (iii) any other employee~~gross ~~that~~profit for the ~~Committee determines appropriate from time to time~~period.

Base salary has been determined for each Named Executive Officer based upon individual performance and, in relation to comparable positions within corporations of comparable size in similar industries. The compensation awarded to Kenneth Kirkpatrick, President and CEO, John Sentjens, Vice President, Finance and Corporate Secretary, and Andrew Carniel, Vice President, Business Development was determined with reference to a report dated October 19, 2005, prepared by Watson Wyatt & Company in connection with an assessment of the salaries to be paid to senior management of CHI Systems Inc., a corporation of a size comparable to the Company which was acquired by the Company in December of 2005. The report was based on a review of four published survey sources of compensation data for high tech companies. In electing to use that report, the Human Resources and Compensation Committee noted that CHI Systems Inc. is of a comparable size to the Company in terms of revenues and total number of employees, and is in a similar industry. Base salary levels are intended to attract and retain executives, provide fair and competitive compensation commensurate to an executive’s experience, as well as to reward individual performance and one’s achievement of objectives. Annual performance-based incentives are designed to encourage and award improved performance from year to year.


	At August 31,		At November 30,
Financial Position:	2007		2006
In thousands of U.S. dollars
	$		$
Working capital⁽¹⁾		8,205		7,789
Current assets		12,775		14,333
Total assets		23,542		24,345
Current liabilities		4,570		6,544
Long term liabilities		425		20
Total liabilities		4,995		6,564
Shareholders’ equity		18,547		17,781

In(1) ~~2007~~Working ~~the~~capital ~~Board~~is ~~awarded~~defined ~~the~~as ~~following~~current ~~bonuses~~assets toless ~~the~~current ~~Named~~liabilities. ~~Executive~~Working ~~Officers~~capital indoes ~~respect~~not ofhave ~~the performance~~a ofstandardized ~~the~~meaning ~~Company~~or incomparable ~~the~~measure ~~financial~~under ~~year~~generally ~~ended~~accepted ~~November 30,~~accounting ~~2006:~~ principles and may not be comparable to similar measures presented by other companies.

Kenneth Kirkpatrick	$	78,000
John Sentjens	$	39,000
Wayne Zachary	$	34,053
Andrew Carniel	$	33,000

Page 4 of 18

11OSI Geospatial Inc. Management’s Discussion and Analysis For the three and nine months ended August 31, 2007 (expressed in U.S. dollars)

The compensation of Kenneth Kirkpatrick, the President and CEO, (who was appointed to those positions on November 7, 2005) consists of the same elements as are included in the compensation of other executive officers as described above and is established by the Board in consultation with the Human Resources and Compensation Committee based on its opinion as to a fair and reasonable compensation package, taking into account his contribution to the Company’s performance, long-term growth and corporate remuneration practices in Canada and abroad.


Dividends declared per share	In nine months ended August 31,
In U.S. dollars	2007 $		2006 $
Common shares		—		—
Class A preference shares		—		—
Class B preference shares – series 1		—		—
Class B preference shares – series 2		1.64		1.59

~~The~~RESULTS ~~Company’s~~OF ~~executive~~OPERATIONS ~~compensation~~– ~~programs~~Three ~~are also designed to attract~~ and ~~retain~~nine ~~highly qualified~~months ~~senior~~ended ~~executives~~August 31, ~~and~~2007 ~~recognize~~as ~~that~~compared long-term performance incentives are an integral part of aligning the interest of executive officers and the Company’s shareholders. Long-term incentives are principally in the form of stock options. When determining whether and how new stock options are to bethree ~~granted, the Human Resources~~ and ~~Compensation Committee considers a number of~~nine ~~factors~~months ~~including~~ended ~~salary~~August 31, ~~level of responsibility and the amount and terms of outstanding stock~~2006 ~~options. Stock options to executive officers are typically granted early in each fiscal year, vest immediately, and expire in three to five years.~~

~~The~~Overall ~~Company also has in place a plan for the executive officers and all other employees, including~~Performance the Named Executive Officers, whereby the Company will pay a maximum of 4% of an employee’s base salary earned during the year to a designated registered retirement savings plan, provided that the employee matches such payment. The plan is intended to encourage employees to save for their retirement while providing an incentive package which is competitive with those offered by similar companies.

Submitted by the Human Resources and Compensation Committee for the financial year ended November 30, 2006:


Three months ended August 31	2007			2006			2007 to 2006
In thousands of U.S. dollars
Net earnings (loss) before income taxes	$	332		$	(913	)	$	1,245

Net earnings (loss)	$	279		$	(709	)	$	988

Net earnings (loss) attributable to common shareholders	$	109		$	(972	)	$	1,081

Earnings (loss) per share – basic and diluted		0.00			(0.03	)		0.03


Nine months ended August 31								2007 to 2006

In thousands of U.S. dollars

Net loss before income taxes	$	(2,032	)	$	(2,058	)	$	26

Net loss	$	(2,076	)	$	(1,853	)	$	(223	)

Net loss attributable to common shareholders	$	(2,628	)	$	(2,642	)	$	14

Loss per share – basic and diluted		(0.07	)		(0.08	)		0.00

E.The ~~Brinton~~net ~~Coxe~~loss reported in the nine months ended August 31, 2007 was largely driven by lower revenues and the mix of contracts executed in the period and higher operating expenses due to the addition of costs from our acquired operations, product launch activities, and an increase in staff to support our growth plans.

~~Raymond W. Johnston~~Backlog

~~Walter~~Total Pbacklog is the sum of the firm and option backlogs. ~~Purio~~As at August 31, 2007 total backlog was $70.2 million compared to $35.2 million at August 31, 2006.

~~STOCK~~Firm ~~PERFORMANCE~~backlog ~~GRAPH~~consists of firm, fixed, or signed orders issued and executable subsequent to the balance sheet date. Firm backlog as at August 31, 2007 was at $45.9 million compared to $14.9 million at August 31, 2006. Of the $45.9 million firm backlog, $30.1 million is expected to be executed in fiscal 2009 and beyond.

~~The~~Page ~~following~~5 ~~graph compares the total cumulative shareholder return for $100 invested in the common shares~~ of ~~the Company traded on the Toronto Stock Exchange (“TSX”) with the TSX S&P~~18 ~~Composite Index during the period December 1, 2000 through November 30, 2006.~~

12OSI Geospatial Inc. Management’s Discussion and Analysis For the three and nine months ended August 31, 2007 (expressed in U.S. dollars)

~~COMPENSATION~~Option OFbacklog ~~DIRECTORS~~consists of unexercised contract options at the balance sheet date and indefinite-quantity contracts executable subsequent to the balance sheet date. Option backlog as at August 31, 2007 was at $24.3 million compared to $20.3 million at August 31, 2006.

~~Cash~~There ~~Compensation~~is no guarantee or certainty that our customers will elect to exercise their contract option backlog. Should our customers elect to exercise contract options or place orders against indefinite-quantity contracts, the option backlog converts to firm backlog, which then may convert to revenue as contract execution occurs. Backlog metrics are non-GAAP measures. These measures do not have a standardized meaning or comparable GAAP measure and are likely not comparable to similar measures presented by other companies.

~~During~~The ~~the~~timing ~~fiscal year ended November 30, 2006, each member~~ of ~~the~~major ~~Board~~contracts ofawarded ~~Directors~~can ofsignificantly ~~the Company~~impact ~~who~~our ~~was~~total ~~not~~backlog anposition ~~employee of the Company was entitled to receive $1,500 for each Board meeting attended in person,~~ and ~~$1,000 for each Board meeting which was held by means of telephone~~ ~~conference call if of significant length or involving significant preparation~~revenue. ~~Canadian~~Historically, ~~directors are~~major ~~paid~~contracts inawarded ~~Canadian~~have ~~funds~~taken ~~and~~up ~~all~~to ~~other~~three ~~directors~~years ~~are~~to ~~paid in U~~finalize.S. ~~funds. During the fiscal year,~~The ~~the~~contracting ~~Board~~process ~~held~~involves ~~four~~lengthy ~~face-to-face~~discussions ~~meetings~~ and ~~six~~negotiations ~~telephone~~with ~~conference~~several ~~call~~groups ~~meetings. The directors as a group were paid an aggregate~~ of ~~approximately $56,540 for attending or participating in these~~people ~~meetings.~~within ~~In addition,~~ the ~~Chair~~prospective ofcustomer’s ~~the Board was paid an annual retainer of $50,000~~organization. ~~Each~~We ofhave ~~the remaining~~continually ~~directors was paid an annual retainer of $15~~pursued,~~000.~~ ~~The~~and ~~Audit~~will ~~Committee~~continue ~~chair was paid an~~to ~~annual retainer of $10~~pursue,~~000~~ ~~and~~major ~~the~~contracts ~~Human~~with ~~Resources~~lengthy ~~and~~sales ~~Compensation Committee chair was paid an annual retainer of $5~~cycles,~~000.~~ ~~Members~~and ofas ~~the~~a ~~Audit Committee~~result, ~~members~~there ofcould ~~the~~be ~~Human~~large ~~Resources and~~variations ~~Compensation~~in ~~Committee~~our ~~and members of the Executive Committee were paid $1,500 for each committee meeting attended. Members of the Committees were paid a~~ total ofbacklog ~~approximately~~and ~~$47,364~~revenue ~~for attending~~from orquarter ~~participating~~to ~~in a total of ten Committee meetings~~quarter.

~~Stock~~Multi-year ~~Options~~contracts with government agencies have a termination-for-convenience clause because governments approve budget expenditures on an annual basis. This allows contracts to be terminated by the contracting government agency should future budget funding not be approved. Historically, the termination-for-convenience clause has not been exercised by any of our customers. We have included the full value of these government contracts in total backlog.

~~The following directors received stock options under the Company’s 1998 stock option plan in their~~Revenue ~~capacity as a director during the financial year ended November 30, 2006:~~

					Market Value of
			% of				% of
					Securities
			total				total
			Exercise or Base		Underlying Options
Three months ended August 31	2007		revenue		2006		revenue		2007 to 2006
	Securities Under		Price of		on the Date of Grant
In thousands of U.S. dollars
Name of Director	Options Granted (#)		($/Security)		($/Security)		Expiration Date
Marine systems	$	3,124		42%	$	1,240		29%	$	1,884
Raymond W. Johnston (1)	25,000		$0.73		$0.73		April 12/11
Land and air systems		2,627		36%		2,022		47%		605
Walter P. Purio	25,000		$0.73		$0.73		April 12/11
Mapping		1,591		22%		1,054		24%		537
Helmut F. Lobmeier	25,000		$0.73		$0.73		April 12/11
	$	7,342		100%	$	4,316		100%	$	3,026
E. Brinton Coxe	25,000		$0.73		$0.73		April 12/11
Gerald J. Shields	25,000		$0.73		$0.73		April 12/11
Donald W. Young	3,750 45,000		$0.73 $0.73		$0.73 $0.73		March 15/11 April 12/11
Joseph A. Stroud	3,750 45,000		$0.73 $0.73		$0.73 $0.73		March 15/11 April 12/11

Notes:


			% of				% of
			total				total
Nine months ended August 31	2007		revenue		2006		revenue		2007 to 2006
In thousands of U.S. dollars
Marine systems	$	6,267		37%	$	4,958		35%	$	1,309
Land and air systems		7,294		43%		6,244		44%		1,050
Mapping		3,489		20%		2,917		21%		572

	$	17,050		100%	$	14,119		100%	$	2,931

~~(1)~~Our Mrcore revenue stream is derived from three sources: marine systems, land and air systems, and mapping. ~~Johnston~~Our ~~serves~~land asand air systems through our U.S. Systems operations delivered 43% of our revenue for the ~~Chair~~nine months ended August 31, 2007. Our principal developed and manufactured product, ECPINS®, delivers the majority of the ~~Board~~marine systems revenue. We also derive revenue from the delivery of ~~Directors~~the ECPINS® software component of our system product. Combined, ECPINS® systems and software delivered 24% of revenue in the nine months ended August 31, 2007.

~~Fees~~Our results are primarily affected by the level, timing, and duration of customer orders and customer product delivery requirements. The main customers for ~~Services~~our asproducts ~~Consultants~~and orservices ~~Advisors~~in the nine months

~~During~~Page ~~fiscal~~6 ~~2006 the Company engaged the services~~ of ~~a law firm of which Gerald Shields, a~~18 director, had an interest. The Company paid to that law firm a total of $202,954 in legal fees, disbursements and taxes during the fiscal year. The law firm provided legal services as well as general corporate and securities law services. Fees paid to that law firm in the prior year were $165,935. As of November 17, 2006, Mr. Shields no longer has an interest in any law firm that provided legal services to the Company.

13OSI Geospatial Inc. Management’s Discussion and Analysis For the three and nine months ended August 31, 2007 (expressed in U.S. dollars)

~~SECURITIES~~ended ~~AUTHORIZED~~August 31, ~~FOR~~2007 ~~ISSUANCE~~were ~~UNDER~~the ~~EQUITY~~U.S. ~~COMPENSATION~~Army, ~~PLANS~~the Royal Navy of the U.K., the Defense Threat Reduction Agency, the Defense Advanced Research Projects Agency, the Royal Australian Navy and the U.S. Navy. Revenue from these customers accounted for 58% of the consolidated revenue.

The ~~only~~main ~~compensation~~customers ~~plans~~for ~~under~~our ~~which~~products ~~equity~~and ~~securities~~services ~~of the Company are authorized~~ for ~~issuance~~ ~~are~~ the ~~three~~nine ~~Stock~~months ~~Option~~ended ~~Plans of the Company~~August 31, ~~all~~2006 ofwere ~~which have been approved by~~ the ~~shareholders~~U.S. ~~The~~Navy’s ~~following~~Naval ~~table~~Aviation, ~~sets~~U.S. ~~out~~Army, ~~a summary of~~ the ~~number~~Canadian ofNavy, ~~securities~~and tothe beRoyal ~~issued~~Australian ~~upon~~Navy through ~~the~~Nautronix ~~exercise~~Ltd. ofRevenue ~~outstanding~~from ~~options~~these ascustomers ataccounted ~~the~~for ~~Company’s~~70% ~~year-end~~ of ~~November 30,~~the ~~2006~~consolidated revenue.

	Number of Securities to beIssued Upon Exercise ofOutstanding Options,Warrants and Rights		Weighted-Average ExercisePrice of OutstandingOptions, Warrants andRights		Number of SecuritiesRemaining Available forFuture Issuance UnderEquity Compensation Plans(Excluding SecuritiesReflected inColumn (a))
Plan Category		(a)		(b)		(c)
Equity compensation plans approved by securityholders		3,417,584		$0.95		946,910
Equity compensation plans not approved by securityholders		0		0		0
Total		3,417,584		$0.95		946,910

Revenue by Segment

CORPORATE GOVERNANCE


			% of				% of
			total				total
Three months ended August 31	2007		revenue		2006		revenue		2007 to 2006
In thousands of U.S. dollars
International Systems operations	$	2,390		32%	$	1,240		29%	$	1,150
U.S. Systems operations		3,361		46%		2,022		47%		1,339
Mapping operations		1,591		22%		1,054		24%		537

	$	7,342		100%	$	4,316		100%	$	3,026

Board of Directors


			% of				% of
			total				total
Nine months ended August 31	2007		revenue		2006		revenue		2007 to 2006
In thousands of U.S. dollars
International Systems operations	$	5,533		33%		4,958		35%		575
U.S. Systems operations		8,028		47%		6,244		44%		1,784
Mapping operations		3,489		20%		2,917		21%		572

	$	17,050		100%		14,119		100%		2,931

AsRevenue offrom the ~~date~~International ofSystems ~~this~~operations ~~Information~~for ~~Circular~~the three months ended August 31, ~~the~~2007 increased ~~directors~~93% ofand for the ~~Company~~nine ~~are~~months ~~Raymond~~ended ~~Johnston~~August 31, ~~Kenneth~~ ~~Kirkpatrick,~~2007 ~~Brinton~~increased ~~Coxe,~~12% ~~Helmut~~due ~~Lobmeier,~~to ~~Walter~~the ~~Purio,~~growth ~~Gerald~~in ~~Shields~~the business, ~~Joseph~~timing ~~Stroud~~of ~~and Donald~~new ~~Young.~~contracts ~~Messrs. Johnson~~awarded, ~~Lobmeier,~~the ~~Purio~~delivery ~~Shields,~~schedules ~~Stroud~~of ~~and~~existing ~~Young~~contracts ~~are~~and ~~independent~~the ~~directors,~~mix ~~while~~of ~~Messrs. Kirkpatrick~~products and ~~Coxe~~services ~~are not independent~~delivered.

ARevenue ~~member~~from of the ~~Board~~U.S. isSystems ~~considered~~operations ~~not~~for tothe bethree ~~“independent”~~months ifended heAugust 31, or2007 ~~she~~increased ~~has a direct or indirect~~by ~~“material~~66% ~~relationship”~~and ~~with~~for the ~~Company~~nine asmonths ~~set~~ended ~~out in Section~~August ~~1.2~~31, of2007 ~~National~~increased ~~Instrument~~29% ~~58-101. Mr. Kirkpatrick~~over isthe ~~not~~same anperiod ~~independent~~from ~~director inasmuch as he serves as President and CEO of~~ the prior ~~Company~~year. ~~Mr. Coxe~~The increase is ~~not an independent director~~ due to the ~~fact~~acquisition ~~that~~of the ~~Company~~Layered ~~paid~~Security ~~him~~Solutions ~~fees~~business ~~for~~unit as ~~providing~~well ~~advisory~~as ~~services~~general togrowth in the ~~Company~~segment. ~~during~~For the ~~financial~~three ~~year~~months ended ~~November~~August 3031, ~~2005. Directors~~2006, ~~who~~delays ~~have an interest~~ in ~~a transaction involving~~ the ~~Company are required to declare such~~ ~~interests~~approval ~~and~~of ~~abstain~~the ~~from~~U.S. ~~voting~~federal onbudget ~~any~~negatively ~~resolution~~impacted ~~respecting the transactions~~revenue.

~~The~~Revenue ~~following~~from ~~directors~~our ofMapping ~~the~~operations ~~Company~~for ~~are~~the ~~currently~~three ~~directors~~and ofnine ~~other~~months ~~reporting~~ended ~~issuers~~August 31, 2007 as ~~noted~~compared ~~opposite~~to ~~their~~the ~~names:~~nine months ended August 31, 2006 increased 51% and 20% respectively. This is consistent with the increased business volume and the nature and timing of mapping contracts.

~~Name~~We ~~Name~~continue ofto ~~Reporting~~invest ~~Issuers~~significant ~~Gerald~~corporate, J.sales, ~~Shields~~and ~~Rainy~~marketing ~~River~~resources ~~Resources~~in ~~Ltd.~~identifying ~~Heartland~~and pursuing ~~Resources~~new ~~Inc.~~opportunities E.and ~~Brinton~~contracts, ~~Coxe~~both ~~InNexus~~in ~~Biotechnology~~our ~~Inc~~existing customer base and with new prospective customers.

14Page 7 of 18

~~During~~OSI ~~the~~Geospatial ~~course~~Inc. Management’s ofDiscussion ~~meetings~~and ofAnalysis For the ~~Board~~three ofand ~~Directors,~~nine ~~the~~months ~~Board~~ended ~~regularly holds in-camera sessions at which members of management, including Mr.~~August ~~Kirkpatrick~~31, ~~the~~2007 (expressed ~~President~~in ~~and CEO, are excused~~U.S. ~~The independent directors do not regularly hold meetings consisting only of the~~dollars) ~~independent directors due to the size of the board.~~

~~Mr. Johnston,~~Gross ~~who serves as Chair of the Board (which is not a full-time position), is an~~Profit independent director. The responsibilities of the Chair include ensuring that the Board discharges its obligations, understands the boundaries between the responsibilities of the Board and those of management, ensuring that all Board meetings are run in an orderly manner, assisting and scheduling Board meetings, ensuring that the Board complies with the Company’s Corporate Governance Policies, ensuring that the Board meets on a regular basis without management.

From December 1, 2005 to November 30, 2006, the Board held four face-to-face meetings and six meetings by way of telephone conference call. All of the current directors participated in all of the meetings except Mr. Purio, who missed one conference call meeting.


Three months ended August 31	2007		2006		2007 to 2006
In thousands of U.S. dollars
Gross profit	$	3,048	$	1,403	$	1,645
Gross profit percentage		42%		33%		9%

Board of Directors’ Mandate


Nine months ended August 31	2007		2006		2007 to 2006
In thousands of U.S. dollars
Gross profit	$	6,172	$	5,192	$	980
Gross profit percentage		36%		37%		(1%	)

~~The~~Gross ~~Board~~profit ofincreased ~~Directors’~~by ~~mandate~~117% isin ~~published~~the onthree months ended August 31, 2007 compared to the ~~Company’s~~three months ~~website~~ended atAugust 31, ~~www~~2006 and the gross profit percentage was 9 percentage points higher period-over-period.~~osigeospatial~~ This was due to higher margin systems and software sales.~~com.~~ AGross profit ~~true~~decreased ~~copy~~1% ofin the ~~Board’s~~nine ~~mandate~~months isended ~~attached~~August 31, as2007. ~~Schedule A~~The reduced gross profit percentage compared to ~~this~~the ~~Information~~prior ~~Circular~~fiscal year is due to the mix of contracts in the period.

~~Position~~Gross ~~Descriptions~~Profit by Segment

The Board has developed a written position description for the Chair. The Board has not developed written position descriptions for the Chairs of any of the Board committees. However, by Company practice, the Chair of each committee is charged with the responsibility of scheduling committee meetings and putting forth the proposed agenda for the meetings, ensuring that the committee fulfils its mandate as set out in the Company’s Corporate Governance Policy, ensuring that proper minutes of the meetings are taken and preparing and submitting reports to the Board respecting the proceedings of the committees.


Three months ended August 31	2007		2006		2007 to 2006
In thousands of U.S. dollars
Gross profit:
International Systems operations	$	1,331	$	719	$	612
U.S. Systems operations		1,127		472		655
Mapping operations		590		212		378

Consolidated operations	$	3,048	$	1,403	$	1,645


Gross profit percentage:
International Systems operations		56%		57%		(1%	)
U.S. Systems operations		34%		23%		11%
Mapping operations		37%		20%		17%

Consolidated operations		42%		33%		9%

The Company has developed, and the Board has approved, a written position description for the CEO.


Nine months ended August 31	2007		2006		2007 to 2006
In thousands of U.S. dollars
Gross profit:
International Systems operations	$	2,915	$	3,012	$	(97	)
U.S. Systems operations		2,092		1,439		653
Mapping operations		1,165		741		424

Consolidated operations	$	6,172	$	5,192	$	980


Gross profit percentage:
International Systems operations		53%		61%		(8%	)
U.S. Systems operations		26%		23%		3%
Mapping operations		33%		25%		8%

Consolidated operations		36%		37%		(1%	)

~~Orientation~~Page ~~and~~8 ~~Continuing~~of ~~Education~~18

~~New~~OSI ~~directors~~Geospatial ~~are~~Inc. Management’s ~~given~~Discussion ~~extensive briefings by the Chair of the Board, the CEO,~~ and ~~other members~~Analysis ofFor ~~senior management with respect to~~ the ~~business~~three and ~~operations~~nine ofmonths ~~the~~ended ~~Company~~August 31, ~~and they make an~~2007 ~~on-site~~(expressed ~~visit~~in ~~to the Company’s headquarters~~U. ~~New directors are also provided with a record of public and other pertinent information concerning the Company, as well as a corporate manual~~S. ~~Directors~~ ~~are provided with summaries of developments and regulatory amendments to corporate~~dollars) ~~governance policies on an ongoing basis. At the last Board meeting of each year a proposed schedule~~ for Board meetings for the forthcoming year is presented, and the time commitment required of the Board and committee members is reviewed to ensure that all directors and committee members are made aware of what is expected of them.

~~Ethical~~Gross ~~Business~~profit ~~Conduct~~from the International Systems operations increased $612,000 and gross profit percentage was 1% higher for the three months ended August 31, 2007 when compared to the three months ended August 31, 2006. Gross profit decreased $97,000 and gross profit percentage decreased 8% for the nine months ended August 31, 2007. The changes are the result of higher revenues in the International Systems operations and slightly lower margins on projects that generated revenue during the three months ended August 31, 2007 when compared to the three months ended August 31, 2006.

~~The~~Gross ~~Company~~profit ~~has~~from ~~adopted~~the aU.S. ~~Code~~Systems ofoperations ~~Ethics~~increased ~~for~~$655,000 ~~Directors~~ and ~~Senior~~gross ~~Officers~~profit ~~(the~~percentage ~~“Code”) which has~~was ~~been~~11% ~~distributed~~higher tofor ~~them,~~the asthree ~~well~~months asended aAugust 31, ~~Code~~2007 ofwhen ~~Ethics~~compared ~~for~~to ~~Employees~~the ~~which~~three ~~has~~months ~~been distributed to~~ended ~~all directors~~August 31, ~~officers, employees and consultants~~2006. ~~Copies~~Gross ofprofit ~~the~~increased ~~Code~~$653,000 ~~are~~and ~~available~~gross ~~from~~profit ~~the Company~~percentage onincreased ~~written~~3% ~~request and are available~~ for ~~viewing on www.sedar.com and~~ the ~~Company’s~~ ~~investor~~nine ~~website~~months atended ~~www~~August 31, 2007.~~osigeospatial.com.~~ IfThis aincrease ~~person~~in ~~knows~~the orthree ~~suspects~~and anine ~~violation~~months ofended ~~the~~August 31, 2007 ~~Code~~compared to ~~which~~ hethe orthree ~~she~~and isnine ~~subject,~~months ~~that~~ended ~~person~~August 31, ~~must~~2006 ~~immediately~~is ~~report~~ the ~~alleged~~result ~~violation to the Chair~~ of ~~the~~over ~~Board or~~$700,000 ifin higher hemargin ormarine ~~she~~navigation isrevenue ~~not~~to ~~available,~~U.S. ~~then~~customers ~~the~~during ~~Chair~~for of the ~~Audit Committee~~period. ~~In addition,~~ ~~the Board has adopted a~~

15Gross profit from the Mapping operations for the three months ended August 31, 2007 increased $378,000 compared to the same in the prior year. Gross profit percentage increased 17% period over period, consistent with the mix and timing of contracts in the business unit, and in particular, due to lower subcontractor work utilized in the period. Gross profit from the Mapping operations for the nine months ended August 31, 2007 increased $424,000 compared to the same period in the prior year. Gross profit percentage increased 8%. Again, this is consistent with the mix of contracts for the period.

~~whistle~~Operating ~~blower policy for directors, officers and employees and a whistler blower policy for third~~Expenses ~~parties (i.e. persons who are not employed by the Company) which permit people to anonymously report unethical conduct concerning directors, officers and employees of the Company.~~

Nomination of Directors


			% of				% of
			total				total
Three months ended August 31	2007		revenue		2006		revenue		2007 to 2006
In thousands of U.S. dollars
General and administrative	$	1,451		20%	$	1,460		34%	$	(9	)
Engineering		231		3%		389		9%		(158	)
Sales and marketing		755		10%		510		12%		245

Due to the relatively small size of the Board, the Board does not have a nominating committee; rather, the Board as a whole assumes responsibility to assess and make recommendations regarding Board effectiveness and to establish a process for identifying, recruiting, appointing, re-appointing, and providing ongoing education and development for directors.


			% of				% of
			total				total
Nine months ended August 31	2007		revenue		2006		revenue		2007 to 2006
In thousands of U.S. dollars
General and administrative	$	4,249		25%	$	4,320		31%	$	(71	)
Engineering		1,101		6%		1,382		10%		(281	)
Sales and marketing		2,252		13%		1,668		12%		584

~~Compensation~~General and administrative (“G&A”) expenses consist mainly of salaries and benefits of management and administrative personnel, professional fees, public company expenses, related facility costs, and other general administrative expenses.

~~The~~G&A ~~Human~~decreased ~~Resource~~slightly ~~and~~for ~~Compensation~~three ~~Committee~~months isended ~~mandated to review~~August 31, 2007 and ~~recommend~~also tofor the ~~Board~~nine ~~for~~months ended ~~approval~~August 31, ~~the~~2007, ~~remuneration~~compared ofto ~~senior~~the ~~management~~same ~~and~~periods ~~directors.~~in ~~Compensation~~the isprior ~~reviewed not less than annually~~year. ~~The~~There ~~Human~~was ~~Resource~~little ~~and~~change ~~Compensation~~in ~~Committee and the Board consider~~G&A ~~responsibilities,~~staffing ~~risks,~~levels ~~time commitment,~~ and ~~comparative~~costs ~~remuneration~~between inthe ~~determining~~two ~~compensation~~periods.

~~The~~Engineering ~~Human~~expenses ~~Resources~~consist ~~and~~mainly ~~Compensation Committee retained the firm~~ of ~~Watson~~salaries ~~Wyatt~~and &benefits ~~Company to prepare a survey~~ of ~~compensation~~software inand ~~connection~~hardware ~~with the consideration of compensation set for John~~engineering ~~Sentjens~~personnel, ~~Vice~~sub-contractor ~~President~~costs, ~~Finance~~facilities ~~and Corporate Secretary~~expenses, and ~~Andrew~~related ~~Carniel, Vice President, Business Development~~expenses. ~~Watson~~The ~~Wyatt~~company ~~was~~expenses research ~~mandated~~and todevelopment-related ~~provide~~costs ~~salary~~in ~~ranges~~the ~~for~~period ~~senior~~incurred ~~executives holding~~unless, ~~those positions~~ in ~~companies~~the opinion of ~~comparable~~management, certain ~~size~~develop incosts meet the ~~high~~deferral ~~tech~~criteria ~~industry.~~under ~~See~~Canadian ~~“Report~~GAAP, ~~on Executive~~in ~~Compensation”~~which ~~for~~case ~~further particulars.~~development

~~The~~Page ~~Human~~9 ~~Resources~~of ~~and Compensation Committee set Mr. Kirkpatrick’s compensation in those~~18 ~~capacities with reference to the report received from Watson Wyatt & Company referred to above.~~

~~Other~~OSI ~~Board~~Geospatial ~~Committees~~Inc. Management’s Discussion and Analysis For the three and nine months ended August 31, 2007 (expressed in U.S. dollars)

Inexpenditures ~~addition~~are tocapitalized ~~the~~and ~~Audit~~amortized ~~Committee~~over ~~and~~ the ~~Human~~estimated ~~Resources~~lives ~~and~~of ~~Compensation Committee,~~ the ~~Board has~~related ~~one~~projects. ~~other standing committee~~To date, ~~namely~~ the ~~Executive~~Company ~~Committee.~~has ~~The~~not ~~responsibilities~~capitalized ofany ~~the Executive~~development ~~Committee are to:~~costs.

~~(a)~~Engineering ~~recommend~~costs ~~corporate~~decreased ~~governance~~by ~~procedures;~~6% ~~(b)~~for ~~define~~the ~~limits~~three ofmonths ~~management’s~~ended ~~responsibilities;~~August 31, ~~(c)~~2007, ~~assist~~compared to the ~~Board~~three months inended ~~identifying~~August 31, ~~new~~2006, ~~directors~~and ~~for~~by ~~nomination~~4% tofor the ~~Board~~nine ~~and~~months toended ~~assess~~August 31, ~~directors~~2007, oncompared anto ~~ongoing~~the nine ~~basis;~~months ~~(d)~~ended ~~oversee~~August 31, ~~the~~2006. ~~adequacy~~The ofdecreases ~~operating~~are ~~capital~~related to ~~implement~~engineering ~~the~~staff ~~Company’s~~and ~~business~~related costs ~~plan;~~charged ~~(e)~~to ~~approve~~cost ~~the engagement~~ of ~~individual~~sales ~~directors~~to ofsupport ~~outside~~specific ~~advisors~~customer atorders during the ~~Company’s~~periods. ~~expense~~We atbelieve that ~~appropriate~~in ~~circumstances;~~order ~~and~~to ~~(f)~~maintain ~~oversee~~our ~~the~~technological ~~Company’s~~leadership, ~~activities~~we inmust ~~the~~continue ~~area~~to ofdevelop ~~investor~~existing products ~~relations~~ and ~~relations~~introduce ~~with~~innovative new products that challenge and redefine the ~~capital~~industry ~~markets~~standards.

~~Assessments~~Sales and marketing (“S&M”) expenses consist primarily of compensation of sales and marketing personnel, as well as expenses associated with advertising, trade shows, facilities, and other expenses related to the sales and marketing of our products and services.

~~Pursuant~~S&M expenses increased by 48% and 35% for the three and nine months ended August 31, 2007 compared to the ~~Company’s~~three ~~Board~~and ofnine ~~Directors’~~months ~~Mandate~~ended August 31, ~~attached~~2006. asThe ~~Schedule~~increases ~~“A”~~in S&M expenses are primarily due to ~~this~~additional ~~Information~~sales and marketing emphasis. We believe our current level of S&M staff continues to ~~Circular,~~allow ~~the~~us ~~Board~~to ispursue ~~responsible~~business ~~for~~development ~~annually~~activities ~~assessing~~relating to our expansion efforts targeting new and existing customers in the ~~effectiveness~~military agencies of Canada, the ~~Board~~U.S., asEuropean aNATO, and other ~~whole~~allies of Canada, ~~its~~and ~~committees~~national and international commercial marine transportation companies. To increase our profile and our products, and to broaden our customer base in international markets, we have established marketing agreements with companies local to the ~~contributions~~targeted regions. Some of these ~~individual~~activities ~~directors~~will not result in closing orders during the current year but may yield orders in subsequent fiscal years.

16Depreciation and Amortization

AUDIT COMMITTEE AND RELATIONSHIP WITH AUDITOR


Three months ended August 31	2007		2006		2007 to 2006
In thousands of U.S. dollars
Depreciation and amortization	$	129	$	191	$	(62	)

Pursuant to Multilateral Instrument 52-110 Audit Committees, the Company has provided disclosure with respect to its Audit Committee in the Company’s annual information form. Please refer to the annual information form for this information. The annual information form is available on SEDAR at www.sedar.com.


Nine months ended August 31	2007		2006		2007 to 2006
In thousands of U.S. dollars
Depreciation and amortization	$	377	$	580	$	(203	)

~~INDEBTEDNESS~~Total OFdepreciation ~~DIRECTORS~~and ~~AND~~amortization ~~EXECUTIVE~~decreased ~~OFFICERS~~by 32% and 35% on the three and nine months ended August 31, 2007 as compared to the three and nine months ended August 31, 2006. For the three months ended August 31, 2007 and 2006, a portion of the depreciation, $54,000 and $49,000 respectively, was included in cost of sales for equipment used in revenue-generating activities.

~~None~~Interest ~~of the directors or executive officers of the Company was indebted to the Company at any time~~expense ~~during the financial year ended November 30, 2006. The Company does not have any programs under which it loans money to directors or executive officers to purchase securities of the Company.~~

INTEREST OF INFORMED PERSONS IN MATERIAL TRANSACTIONS


Three months ended August 31	2007		2006		2007 to 2006
In thousands of U.S. dollars
Interest expense	$	22	$	3	$	19

Other than as set forth in this or any previous Information Circular, and other than transactions carried out in the normal course of business of the Company or any of its affiliates, none of the directors or senior officers of the Company, any member beneficially owning shares carrying more than 10% of the voting rights attached to the shares of the Company, nor an associate of affiliate of any of the foregoing persons, had since December 1, 2005, being the date of commencement of the Company’s last completed financial year, any material interest, direct or indirect in any transactions which materially affected the Company or in any proposed transaction which has or would materially affect the Company.


Nine months ended August 31	2007		2006		2007 to 2006
In thousands of U.S. dollars
Interest expense	$	48	$	15	$	33

~~APPOINTMENT~~Page OF10 ~~AUDITOR~~of 18

~~Ernst~~OSI &Geospatial ~~Young LLP, Chartered Accountants, of 700 West Georgia Street, 23rd Floor,~~Inc. ~~Vancouver,~~Management’s ~~British~~Discussion ~~Columbia,~~and ~~V7Y 1C7 will be nominated at the meeting for reappointment as auditor~~Analysis ofFor the ~~Company~~three atand anine ~~remuneration~~months toended ~~be fixed by the directors. Ernst & Young LLP~~August 31, ~~was first~~2007 ~~appointed~~(expressed ~~auditor~~in ~~on April 17, 2003~~U.S. dollars)

~~MANAGEMENT~~Interest ~~CONTRACTS~~expense increased $19,000 in the three months ended August 31, 2007 as compared to the three months ended August 31, 2007. Interest expense increased $33,000 in the nine months ended August 31, 2007 as compared to the nine months ended August 31, 2006. The Company increased its utilization of its credit facility during the three and nine months ended August 31, 2007. Additionally, there was also an increase in the interest rates in the period.

~~Management~~Interest ~~services for the Company are not, to any material degree, performed by persons other~~income ~~than the directors and executive officers of the Company.~~

PARTICULARS OF MATTERS TO BE ACTED UPON


Three months ended August 31	2007		2006		2007 to 2006
In thousands of U.S. dollars
Interest income	$	—	$	—	$	—

Restated Shareholder Rights Plan


Nine months ended August 31	2007		2006		2007 to 2006
In thousands of U.S. dollars
Interest income	$	7	$	20	$	(13	)

~~Introduction~~Interest income was nil in the three months ended August 31, 2007 and 2006. Interest income decreased $13,000 in the nine months ended August 31, 2007 as compared to the nine months ended August 31, 2006 as the Company did not have surplus funds to invest.

OnForeign ~~April 19, 2001, the Board of Directors of the Company adopted the Shareholder Rights Plan (the “2001 Rights Plan”). The 2001 Rights Plan was approved by the Toronto Stock~~ Exchange ~~(the “TSX”)~~ as well as confirmed by the shareholders of the Company at an annual and special meeting in April 2001. On April 24, 2004 the shareholders of the Company voted in favour of the continued existence of the Rights Plan until the close of business on April 19. 2007 Since the 2001 Rights Plan was implemented, the Company changed its name and its authorized share capital. The provincial corporate legislation that governs the Company and securities laws relating to take over bids have also changed since 2001. As a result of these changes, the Board of Directors has adopted an amended and restated shareholder rights plan (the “Rights Plan”). Shareholders will be asked to consider a resolution approving, ratifying and confirming the Rights Plan and all rights (the “Rights”) issued pursuant to the Rights Plan. The Rights Plan is similar to plans adopted by other Canadian companies and approved by their shareholders. With the exception to amendments to change the


Three months ended August 31	2007		2006			2007 to 2006
In thousands of U.S. dollars
Foreign exchange loss (gain)	$	43	$	(18	)	$	(61	)

name of the Company, reducing the redemption price to $0.0001 per right, adding rights attaching to the Company’s Class A Series A Shares the Class B Series 1 Preference Shares and the Class B Series 2 Shares, changing the expiry of a take over bid to 35 days from 21 days making some typographical changes, the Rights Plan is in the same form as the 2001 Rights Plan. The Rights Plan is subject to the approval of the TSX as well as confirmation by the shareholders of the Company at the Meeting. Shareholders will be asked to consider a resolution approving, ratifying and confirming the Rights Plan and all rights (the “Rights”) issued pursuant to the Rights Plan.


Nine months ended August 31	2007		2006			2007 to 2006
In thousands of U.S. dollars
Foreign exchange loss (gain)	$	65	$	(18	)	$	(83	)

AForeign ~~true~~exchange ~~copy~~gain ofand ~~the~~loss ~~agreement~~is ~~which~~largely ~~gives~~the ~~effect~~result toof ~~the~~exchange ~~Rights~~rate ~~Plan~~movements (of the ~~“Rights~~Australian dollar ~~Agreement”)~~and ~~may~~the ~~be reviewed~~UK bypound ~~shareholders~~which ofwere ~~the~~not ~~Company~~in at the Company’s ~~registered~~favour ~~and~~during ~~records~~the ~~office~~nine atmonths ~~Suite~~ended August ~~800~~31, ~~885~~2007 ~~West~~as ~~Georgia~~compared ~~Street,~~to ~~Vancouver~~August 31, ~~British Columbia, V6C 3H1 during normal business hours and can be found on SEDAR at www~~2006.~~sedar.com.~~

~~Directors’~~Technology ~~Recommendation~~Partnerships Canada

The Board of Directors has unanimously determined that the Rights Plan is in the best interests of the Company and its shareholders and recommends that shareholders vote in favour of the Rights Plan.


Three months ended August 31	2007		2006			2007 to 2006
In thousands of U.S. dollars
Royalty	$	139	$	55		$	84
Contribution		—		(227	)		(227	)

Background and Purpose of the Rights Plan


Nine months ended August 31	2007		2006			2007 to 2006
In thousands of U.S. dollars
Royalty	$	276	$	220		$	56
Contribution		—		(731	)		(731	)

~~The~~As ~~objectives~~part of the ~~Rights~~agreement ~~Plan~~entered ~~are~~into toon ~~ensure~~November 15, to1999 ~~the~~with ~~extent possible~~TPC, ~~that~~we ~~all~~are ~~shareholders~~required ofto pay a ~~the~~royalty ~~Company~~of ~~are~~3% ~~treated~~on ~~equally~~annual ~~and~~gross ~~fairly~~revenue in ~~connection~~our ~~with~~subsidiary ~~any~~Offshore ~~take-over~~Systems ~~offer~~Ltd. for the ~~Company.~~period ~~Take-over~~December 1, ~~offers~~1999 ~~may~~to ~~not~~November 30, ~~always~~2008. ~~result~~In inaddition, ~~shareholders~~as ~~receiving~~part ~~equal~~of orthe ~~fair~~agreement ~~treatment~~entered orinto ~~full~~on April ~~value~~26, ~~for their investment. In addition~~2004, ~~current~~we ~~Canadian~~are ~~securities~~required ~~legislation~~to ~~only~~pay ~~requires~~ a ~~take-over~~ ~~offer~~royalty toof ~~remain open for 35 days~~1.4% ~~The~~on ~~Board~~annual ~~believes~~gross ~~that~~revenue ~~this~~in ~~period~~our ~~may be~~subsidiary ~~insufficient~~Offshore ~~for~~Systems ~~the shareholders to evaluate a bid, or~~ for the ~~Board to pursue alternatives which~~ ~~could maximize shareholder value, and make informed recommendations to shareholders.~~

~~The~~Page ~~Rights~~11 ~~Plan is designed to discourage discriminatory or unfair take-over offers for the Company and gives the Board time, if appropriate, to pursue alternatives to maximize shareholder value in the event~~ of ~~an unsolicited Take-over Bid for the Company. The Rights Plan will encourage an~~18 Offeror to proceed by way of a Permitted Bid or to approach the Board with a view to negotiation by creating the potential for substantial dilution of the Offeror’s position. The Permitted Bid provisions of the Rights Plan are designed to ensure that, in any Take-over Bid, all shareholders are treated equally, receive the maximum value for their investment and are given adequate time to properly assess the Take-over Bid on a fully informed basis.

~~The~~OSI ~~Rights~~Geospatial ~~Plan was not adopted in response to, or in anticipation of, any acquisition or take-over offer~~Inc. ~~Furthermore, in adopting the Rights Plan, the Board does not intend to prevent a take-over~~ ofManagement’s ~~the~~Discussion ~~Company,~~and ~~to secure continuance of current management or the directors in office or to deter~~Analysis ~~fair~~For ~~offers for~~ the ~~voting~~three ~~shares~~and ofnine ~~the~~months ~~Company.~~ended ~~The Rights Plan may~~August 31, ~~however, increase the price~~2007 to(expressed bein ~~paid by a potential Offeror to obtain control of the Company and may discourage certain transactions, including a Take-over Bid for less than all the voting shares of the Company~~U. ~~Accordingly, the Rights Plan may deter some Take-over Bids~~S. dollars)

~~The~~period ~~Rights~~January 1, ~~Plan~~2006 ~~is not intended~~ to, ~~and ultimately does not~~December 31, ~~deter~~2008 ~~full~~ and ~~fair~~a ~~offers~~royalty ~~for the shares~~ of ~~the Company~~2.5% ~~The Rights Plan does not impose any additional burden~~ on ~~the~~annual ~~Company’s operations~~gross orrevenue ~~financial~~for ~~capacity. The adoption of~~ the ~~Rights Plan will not in any way lessen or~~ ~~affect~~period ~~the~~January 1, ~~duty~~2009 ~~of the Board~~ to ~~act~~December 31, ~~honestly and in good faith with a view to the best interests of the Company and its shareholders~~2013.

InThe ~~recent~~company ~~years,~~entered ~~unsolicited~~into ~~bids~~two ~~were~~agreements ~~made~~with Technology Partnerships Canada (“TPC”) whereby TPC granted financial assistance for the ~~shares~~purpose of afunding ~~number~~research ofand ~~Canadian~~development ~~public~~activities which ~~companies~~were completed on March 31, 2007. ~~Most~~The ofcontributions ~~these~~we ~~companies~~received ~~had~~were ~~shareholder~~based ~~rights~~on ~~plans~~the ~~which~~eligible expenditures ~~were~~we ~~used~~made byduring each period. As at August 31, 2006 the ~~target’s~~Company has received the entire ~~Board~~$2.9 million of the eligible TPC contributions.

18Income Taxes

Directors to gain time to seek alternatives to the bid with the objective of enhancing shareholder value. In a number of these transactions, a change of control ultimately occurred at a price in excess of the original bid price, demonstrating that the existence of the Rights Plan will not necessarily prevent successful unsolicited Take-over Bids for the common shares.


Three months ended August 31	2007			2006			2007 to 2006
In thousands of U.S. dollars
Future income tax expense (recovery)	$	(10	)	$	(117	)	$	107
Current income tax expense (recovery)		63			(87	)		150

		53			(204	)		257

Terms of the Rights Plan


Nine months ended August 31	2007			2006			2007 to 2006
In thousands of U.S. dollars
Future income tax expense (recovery)	$	(59	)	$	(140	)	$	81
Current income tax expense (recovery)		103			(65	)		168

		44			(205	)		249

~~The~~Based ~~following~~on isthe ainformation ~~summary~~available at the time of the ~~terms~~issue of the ~~Rights~~interim ~~Plan.~~financial ~~This~~statements ~~summary~~for the isthree ~~qualified~~and nine months ended August 31, 2007, we estimated that we would not have sufficient taxable earnings in ~~its~~Canada in future periods to utilize a portion of our $2.1 million Canadian ~~entirety~~non-capital bylosses ~~the~~carried ~~Rights~~forward, ~~Agreement~~$8.6 million scientific research and experimental development costs and other Canadian tax balances.

~~Issue~~We have recognized a future income tax recovery in the three months ended August 31, 2007 related to temporary timing differences between accounting income and income for tax purposes in our U.S. subsidiaries as we believe that it is more likely than not that these differences will be realized in future fiscal years. In accordance with Canadian GAAP, we provided a valuation allowance against deferred tax assets where realization did not meet the requirements of ~~Rights~~“more likely than not” under the liability method of tax allocation. We continue to evaluate our taxable position quarterly and consider factors such as estimated taxable income, the history of losses for tax purposes, and the growth of the Company, among others.

~~Under~~LIQUIDITY ~~the~~AND ~~Rights~~CAPITAL ~~Plan,~~RESOURCES ~~share purchase rights (the “Rights”) are to be created on May~~— August 2531, 2007 ~~in respect~~compared of the shares of the Company at the rate of one Right for each share outstanding as at 5:00 p.m. (Pacific Time) on such date (the “Record Date”) and each “voting share” (a share that entitles the holder to ~~vote~~November 30, ~~on the election of directors) (together “Common Shares”) issued after the~~2006 ~~Record Date but before the earlier of the Separation Time and the Expiration Time (as those terms are defined below).~~

Separation Time


In thousands of U.S. dollars	August 31, 2007		November 30, 2006		2007 to 2006

Cash	$	202	$	—	$	202
Current assets		12,685		14,333		(1,791	)
Current liabilities		4,553		6,544		(2,210	)
Working capital ⁽¹⁾		8,132		7,789		419

~~Until~~(1) ~~the~~Working ~~Separation~~capital ~~Time,~~is ~~the~~defined ~~Rights~~as ~~will~~current ~~trade~~assets ~~together~~less ~~with~~current ~~the~~liabilities. ~~Common~~Working ~~Shares,~~capital ~~will~~does ~~be represented by the Common Share certificates and will~~ not behave ~~exercisable.~~a ~~Certificates~~standardized ~~for~~meaning ~~Common Shares~~or ~~issued~~comparable ~~after~~measure ~~the~~under ~~Record~~generally ~~Time~~accepted ~~but~~accounting ~~prior~~principles ~~to the earlier of the Separation Time~~ and ~~the Expiration~~may ~~Time~~not (as defined below) will bear a legend incorporating the Rights Agreement by reference. Promptly following the Separation Time, separate certificates evidencing the Rights (“Rights Certificates”) will be ~~mailed~~comparable to ~~the~~similar ~~holders~~measures ofpresented ~~record~~by ofother ~~Common Shares as of the Separation Time~~companies. ~~After such time, the Rights Certificates alone will represent the Rights, and the Rights will be transferable separately from the Common Shares.~~

~~The~~Page ~~“Separation~~12 ~~Time” is the close~~ of ~~business on the eighth business day (or such later day as may~~18 ~~be determined by the Board) after the earlier of:~~

~~(a) the~~OSI ~~“Stock~~Geospatial ~~Acquisition~~Inc. Management’s ~~Date”,~~Discussion ~~which~~and isAnalysis For the ~~date~~three ofand ~~the~~nine ~~first~~months ~~public~~ended ~~announcement of~~August 31, ~~facts indicating that a person has become an Acquiring Person~~ 2007 (asexpressed ~~defined~~in ~~below~~U.S. dollars);

~~(b) the~~We ~~date~~strive ofto ~~the~~maintain ~~commencement~~cash-contributing ~~of,~~profitable oroperations ~~first~~that ~~public~~provide ~~announcement~~an ofadequate ~~the intent of any~~liquidity ~~person~~and ~~(other~~capital ~~than~~resource ~~the~~base ~~Company~~for orgrowth. aWe ~~subsidiary~~believe ofthat ~~the~~cash ~~Company)~~flow tofrom ~~commence~~operating activities, ~~a take-over bid~~together ~~(other~~with ~~than~~lines aof ~~Permitted~~credit ~~Bid~~borrowings orof ~~Competing~~Canadian ~~Permitted~~$2.0 million ~~Bid~~and ~~(each~~US as$600,000 ~~defined~~available ~~below))~~under ~~to acquire~~our ~~Beneficial~~revolving ~~Ownership~~credit offacilities, ~~shares~~will ofbe ~~the~~sufficient ~~Company~~ to ~~which~~fund isoperations ~~attached~~and ato ~~right~~provide tofor ~~vote~~needed capital spending for the ~~election~~ ofnext ~~all~~12 months. ~~directors~~We ~~generally~~expect ~~which,~~cash ~~together~~flow ~~with~~from ~~such~~operations ~~person’s~~will ~~voting~~continue ~~shares,~~to ~~constitute~~improve induring the ~~aggregate~~year ~~more~~as ~~than~~scheduled ~~20%~~contract ofmilestone ~~the~~payments ~~voting~~will ~~shares;~~be ~~and~~made on several contracts.

~~(c) the~~At ~~date~~August 31, ~~upon~~2007 ~~which~~our current assets decreased primarily due to a ~~Permitted~~reduction ~~Bid~~in oraccounts receivable. ~~Competing~~Our ~~Permitted~~working ~~Bid~~capital ~~(each~~has asincreased ~~defined~~due to the proceeds received from the share issue, ~~below)~~some ~~ceases~~of which were used to berepay ~~such~~our line of credit and other current liabilities.

~~After~~We ~~the~~have ~~Separation~~credit ~~Time,~~facilities consisting of an operating line and ~~prior~~forward exchange contract facilities. The credit facilities permit us to ~~the~~borrow ~~Expiration~~funds ~~Time~~directly ~~(as~~for ~~defined~~general ~~below)~~corporate purposes, ~~each~~including acquisitions, ~~Right~~at ~~may~~floating ~~be exercised~~rates. toAt ~~purchase~~August 31, ~~one~~2007, ~~Common~~we ~~Share~~had ofno borrowings against our operating line. During the ~~Company~~three atmonths ended August 31, 2007, we utilized the ~~Exercise~~facility ~~Price~~which ~~(defined~~increased interest ~~below)~~expense for the period.

~~The~~Cash ~~Rights Plan has a term of approximately three years and will expire at the close of the annual~~Flows ~~general meeting of shareholders next following April 18, 2010 (the “Expiration Time”) unless the~~


Three months ended August 31	2007			2006			2007 to 2006
In thousands of U.S. dollars
Cash flows provided by (used in):
Operating activities	$	(1,383	)	$	(525	)	$	(858	)
Investing activities		(651	)		—			(651	)
Financing activities		2,214			53			2,161
Impact of foreign exchange on cash balances		22			(34	)		56

Rights are earlier redeemed or exchanged by the Company, or the Rights Plan is extended by further approval of the shareholders.


Nine months ended August 31	2007			2006			2007 to 2006
In thousands of U.S. dollars
Cash flows provided by (used in):
Operating activities	$	(837	)	$	1,405		$	(2,242	)
Investing activities		(821	)		(8,333	)		7,512
Financing activities		1,858			(468	)		2,326
Impact of foreign exchange on cash balances		2			87			(85	)

~~Acquiring~~Cash ~~Person~~flows used in operating activities for the three months ended August 31, 2007 were the result of an increase in accounts receivables offset by the net earnings for the period.

~~Subject~~Cash toflows ~~certain~~used ~~exceptions set forth~~ in ~~the~~investing ~~Rights~~activities ~~Agreement,~~for the ~~dilutive~~three ~~effects~~months ofended the Rights are triggered by a person becoming an Acquiring Person upon the acquisition of Beneficial Ownership of 20% or more of the voting shares. A person will not trigger the separation and exercisability of the Rights if he becomes the Beneficial Owner of 20% or more of the shares as a result of: (a)August ~~a voting share Reduction which~~31, by2007 ~~reducing~~were ~~the number of shares outstanding, increases the~~primarily ~~percentage~~reflective of ~~shares~~additions ~~Beneficially Owned by such person~~ to ~~20%~~plant orand ~~more; (b) a Pro-Rata Acquisition; or (c) share acquisitions made pursuant to a Permitted Bid or otherwise on terms approved by the Board of Directors~~equipment, ~~provided~~intangibles ~~that if he becomes the Beneficial Owner of 20% or more of the voting shares by such means~~ and ~~he subsequently becomes the Beneficial Owner of additional shares,~~ other ~~than~~ ~~by such means, then, as of the date of such additional acquisition, he shall become an Acquiring Person~~assets. ~~A person who is an Acquiring Person as at the Record Time may acquire additional~~ ~~shares to a maximum of 1% of the voting shares without triggering the dilutive effects of the Rights.~~

~~Beneficial~~Cash ~~Ownership~~flows from financing activities for the three months ended August 31, 2007 were the result of the net proceeds of common share financing offset by a decrease in the operating line of credit.

InCash ~~general,~~flows aused ~~person “Beneficially Owns” voting shares held by the person and voting shares actually held by others~~ in ~~circumstances~~operating ~~where~~activities ~~those holdings are or should be grouped together~~ for ~~purposes~~ of the ~~Rights~~nine ~~Plan.~~months ~~Included~~ended ~~are holding by the person’s “Affiliates” (generally~~August 31, ~~a person~~2007 ~~that~~were ~~controls,~~largely ~~is controlled by, or under common control with~~ the ~~other person) and~~ ~~“Associates”~~result ~~(generally, a corporation with more than 10%~~ of ~~its shares controlled by~~ the ~~person,~~net ~~a partner~~loss offor the ~~person, a trust in which the person has a substantial beneficial interest or of which the person is the trustee and the spouse or relatives of the person sharing the person’s residence)~~period. ~~Also included are securities which the person or any of the person’s Affiliates or~~ Associates has the right to acquire within 60 days (other than customary agreements with and between underwriters and/or banking group and/or selling group members with respect to a distribution of securities, and other than pledges of securities in the ordinary course of business).

ACash ~~person~~flows isused ~~also~~in ~~deemed~~investing toactivities ~~“Beneficially~~for ~~Own”~~the ~~any~~nine ~~securities~~months ~~that~~ended ~~are~~August 31, ~~Beneficially~~2007 ~~Owned~~were ~~by any~~primarily ~~other~~reflective ~~person~~of ~~with~~additions ~~which~~to ~~the~~plant ~~person~~and isequipment, ~~acting~~intangibles ~~jointly~~and orother ~~in concert~~assets.

~~Investment~~Page ~~advisors~~13 ~~(for fully managed accounts) and trust companies (acting in their capacities as trustees and administrators) acquiring greater than 20%~~ of ~~the Company’s shares will not be~~18 considered to be the Beneficial Owners of such shares, and so will be exempt from triggering the dilutive effects of the Rights, provided that they are not, either alone or as part of a group, making a Take-over Bid.

~~Rights~~OSI ~~Exercise~~Geospatial ~~Privilege~~Inc. Management’s Discussion and Analysis For the three and nine months ended August 31, 2007 (expressed in U.S. dollars)

~~The~~Cash ~~Rights~~flows ~~will separate~~ from ~~the~~financing ~~shares~~activities ~~and~~for ~~become~~the ~~exercisable~~nine 8months ~~business~~ended ~~days~~August 31, ~~after~~2007 awere ~~person~~the ~~has~~result of ~~acquired~~the ~~20%~~net orproceeds ~~more~~ of, ~~or commences or announces a Take-over Bid for,~~ the ~~Company’s outstanding~~ common ~~shares,~~share ~~other~~financing ~~than~~offset by ~~an acquisition pursuant to~~ a ~~Permitted~~decrease ~~Bid.~~in ~~The~~the ~~acquisition~~operating byline ~~an Acquiring Person~~ of ~~20% or more of the Company’s shares is referred to as a “Flip-in Event”. Prior~~credit toand the ~~Rights being triggered by a Flip~~semi-inannual ~~Event,~~dividends ~~the~~on ~~Rights~~our ~~will~~Class B ~~have~~preference ~~no value and will have no dilutive effect on the~~ shares.

~~When~~As a ~~Flip-in~~result ~~Event~~of ~~occurs~~the ~~each~~above ~~Right~~mentioned ~~(except~~changes, ~~for~~ the ~~Rights~~line ~~beneficially~~of ~~owned~~credit byutilization andecreased ~~Acquiring~~by $548,000 ~~Person~~for orthe ~~certain~~three ~~transferees~~months ofended anAugust 31, ~~Acquiring Person~~2007, ~~which~~and ~~Rights~~deceased ~~shall~~by ~~be void) becomes a right to purchase from the Company~~$904,000 ~~upon~~for ~~exercise thereof in accordance with~~ the ~~terms~~nine ofmonths ~~the~~ended August 31, ~~Rights~~2007.

20In order to reduce the impact of exchange rate fluctuations, we use the forward exchange contract facility to mitigate any foreign exchange gain or loss that might occur. We use the forward exchange contract facility only for known or reasonably certain future foreign currency transactions. At August 31, 2007 we had not entered into any forward exchange contracts.

~~Agreement,~~There ~~common~~can ~~shares~~be ~~having~~no anassurance ~~aggregate market price of twice the Exercise Price (as defined below) for an amount equal to the Exercise Price. Accordingly, a Flip-in Event~~ that iswe ~~not approved by the Board of Directors~~ will ~~result~~have inadequate ~~significant~~financial ~~dilution~~resources, tofinancing, ~~an Acquiring Person. The Rights Plan is designed to require any person interested in acquiring more than 20% of the Company’s shares to do so by way of a Permitted Bid~~ or tocash ~~make an offer which the Board considers~~flows to ~~represent~~support the ~~full~~Company ~~value~~into of the ~~shares~~future.

~~Exercise~~CONTRACTUAL ~~Price and Anti-Dilution Adjustments~~OBLIGATIONS

The price at which a holder of a Right may purchase the Common Shares issuable upon exercise of such right (the “Exercise Price”) will initially be $30.00 per Right. The Rights Agreement provides for adjustments to the number of Rights outstanding, the number of shares which may be acquired pursuant to each Right and the Exercise Price (or a combination of the foregoing) in certain circumstances or upon the occurrence of certain events, including consolidations or subdivisions of the shares, the payment of dividends, limitations that may exist from time to time in respect of the Company’s authorized but unissued share capital or the exchange of existing shares for other shares or securities of the Company.


			Less than		1 to 3		4 to 5		After 5
Payments due by period	Total		1 year		years		years		years
In thousands of U.S. dollars
Facility leases	$	3,761	$	643	$	1,194	$	869	$	1,055
Equipment leases		79		32		38		9		—

Total contractual obligations	$	3,840	$	675	$	1,232	$	878	$	1,055

~~Permitted~~OFF ~~Bid~~BALANCE ~~and~~SHEET ~~Competing Permitted Bid~~ARRANGEMENTS

~~A Permitted Bid will not trigger the dilutive effects of the Rights Plan. The Permitted Bid~~Guarantees ~~requirements include the following:~~

~~(i)~~The ~~the~~Company ~~offer~~has ~~must~~entered beinto ~~made for all shares and must be made by way of~~ a ~~Take-over~~one ~~Bid~~year ~~circular~~guarantee tofor ~~all~~one ~~holders~~ of the Company’s ~~shares;~~subsidiaries, ~~(ii)~~CHI Systems ~~the~~Inc. ~~Offeror~~The ~~must~~Company ~~not~~has ~~Beneficially~~guaranteed ~~Own~~CHI’s ~~more~~bank ~~than~~line ~~10%~~ of ~~the~~credit ~~outstanding shares (this restriction does not apply to Offerors who Beneficially Own 10% or more of the outstanding shares as at the Record Time provided~~ that ~~they~~was doput ~~not~~in ~~increase~~place ~~their Beneficial Ownership~~ by ~~more than 1% of~~ the previous ~~outstanding~~owners ~~shares~~prior ~~after the Record Time); (iii) the offer must be outstanding for a minimum of 60 days~~ to ~~permit~~OSI ~~shareholders~~Geospatial’s ofacquisition ~~the Company to properly assess the bid and to allow competing bids to emerge. This also gives the Board~~ of ~~Directors of the Company sufficient time to review the offer, seek or formulate alternatives and communicate its recommendation to shareholders of the Company~~CHI. ~~Should~~The ~~more~~maximum ~~than~~potential ~~50%~~amount of future ~~shares~~payments ~~held by~~ the ~~shareholders other than the Offeror be tendered to the offer, shareholders of the~~ Company ~~are~~could to be ~~provided~~required ~~with an additional 10 clear business days during which~~ to ~~tender~~make ~~any~~under ~~shares~~this ~~not~~guarantee ~~already~~is ~~tendered~~$600,000. toAt the offer; (iv) the offer must provide that shares may only be taken up and paid for if more than 50% of the shares held by shareholders of the Company other than the Offeror have been deposited or tendered and not withdrawn; (v) when the offer has been madeAugust 31, ~~no further shares may be acquired by the Offeror except pursuant to the Permitted Bid; and (vi) if the consideration offered is not payable entirely in cash~~2007, ~~a fairness opinion must be provided to~~ the ~~shareholders~~carrying amount of the ~~Company~~liability inwas ~~connection with the offer~~nil.

AWe ~~Permitted~~warrant ~~Bid,~~that ~~even~~our ifsoftware ~~not~~and ~~approved~~hardware byproducts will operate substantially in conformity with product documentation and that the ~~Board,~~physical ~~may~~media will be ~~made~~free ~~directly~~from todefect. ~~the~~The ~~shareholders~~specific terms and conditions of the warranties are generally one year but may vary depending on the country in which ~~Company~~the products are sold. ~~Shareholders’~~We ~~approval~~accrue atfor known warranty issues if a ~~special~~loss ~~meeting~~is ~~will~~probable ~~not~~and can be reasonably ~~required~~estimated, and accrue for aestimated ~~Permitted~~incurred ~~Bid~~but unidentified warranty issues based on historical activity. To date, we have had no material warranty claims.

21TRANSACTIONS WITH RELATED PARTIES

~~Instead,~~In ~~shareholders of~~ the ~~Company~~periods ~~will~~being ~~initially~~reported, ~~have~~the atCompany ~~least~~had ~~60 days~~no torelated ~~decide~~party ~~whether to deposit their shares~~transactions.

APage ~~“Competing~~14 ~~Permitted Bid” is a Take-over Bid that is made after a Permitted Bid has been made, but prior to its expiry, and satisfies all the requirements~~ of ~~a Permitted Bid as described above,~~18 except that a Competing Permitted Bid is not required to remain open for 60 days so long as it is open until the later of 35 days after the date the Competing Permitted Bid was made and 60 days after the earliest date on which a Permitted Bid then in existence was made.

IfOSI ~~one~~Geospatial ~~or more Permitted Bids or Competing Permitted Bids are made, the Board of Directors may~~Inc. ~~require~~Management’s ~~that~~Discussion inand ~~order for any such bid to retain its status as a Permitted Bid or Competing~~Analysis ~~Permitted~~For ~~Bid, it must provide that no voting shares will be taken up or paid for prior to~~ the ~~latest~~ ~~time~~three atand ~~which~~nine ~~Permitted~~months ~~Bid~~ended orAugust 31, ~~Competing Permitted Bid expires~~ 2007 (~~the~~expressed ~~“Extension~~in ~~Time”~~U.S. dollars), ~~provided that the Extension Time is not later than 90 days after the date on which such Take-over~~ ~~Bid was made~~

~~Redemption~~PROPOSED ~~and Waiver~~TRANSACTIONS

~~The~~We ~~Board~~are ~~of Directors may, at its option, at any time prior to the Separation Time, elect to redeem all but~~ not ~~less~~currently ~~than~~engaged ~~all of the Rights at a redemption price of $0.0001 per Right and,~~ in ~~that~~ ~~event,~~any ~~the~~proposed ~~right of holders of Rights to exercise the Rights will terminate~~transactions.

~~The~~SELECTED ~~Board~~QUARTERLY ~~of Directors may, prior to the occurrence of the relevant Flip-in Event, waive the~~DATA application of the Rights Plan to a Flip-in Event that may occur by reason of a take-over bid made by take-over bid circular to all holders of record of voting shares. However, if the Board waives the application of the Rights Plan, the Board shall be deemed to have waived the application of the Rights Plan with respect to any other Flip-in Event occurring by reason of such take-over bid made prior to the expiry of a bid for which a waiver is, or is deemed to have been, granted.

~~The~~In ~~Board~~thousands of Directors may, prior to the occurrence of the relevant Flip-in Event, with the prior consent of the holders of voting shares, waive the application of the Rights Plan to a Flip-in Event that may occur by reason of an acquisition of voting shares otherwise than pursuant to a take-over bid made by means of a take-over bid circular to all holders of record of voting sharesU. InS. ~~the event that the Board proposes such waiver, the Board shall extend the Separation Time to a~~dollars ~~date that is no later than 10 business days following the date of the meeting of holders of voting shares called to approve such waiver.~~

Amendments


For the three months ended	August 31		May 31			February 28			November 30
	2007		2007			2007			2006

Revenue	$	7,342	$	6,138		$	3,571		$	10,018
Gross profit		3,048		2,455			669			5,783
Gross profit percentage		42%		40%			19%			58%
Net earnings (loss)		279		(366	)		(1,989	)		2,780
Net earnings (loss) attributable to common shareholders		109		(748	)		(1,989	)		2,293

Loss per share – basic		0.00		(0.02	)		(0.06	)		(0.07	)
Loss per share – diluted		0.00		(0.02	)		(0.06	)		(0.05	)

Following shareholder ratification of the Rights Agreement, the Company may, from time to time, amend the Rights Agreement without the approval of the holders of shares or Rights, to correct any clerical or typographical error. The Company may also, with the consent of the holders of shares, at any time prior to the Separation Time, amend, vary or rescind any of the provisions of the Rights Agreement. After the Separation Time, the Rights Agreement may be amended only with the consent of the holders of Rights.


	August 31			May 31			February 28			November 30
	2006			2006			2006			2005

Revenue	$	4,316		$	6,140		$	3,662		$	5,137
Gross profit		1,403			2,595			1,193			2,636
Gross profit percentage		32%			42%			33%			51%
Net earnings (loss)		(709	)		87			(1,229	)		(783	)
Net earnings (loss) attributable to common shareholders		(972	)		(439	)		(1,229	)		(1,320	)

Loss per share – basic		(0.03	)		(0.01	)		(0.04	)		(0.05	)
Loss per share – diluted		(0.03	)		(0.01	)		(0.04	)		(0.05	)

~~Shareholder~~CRITICAL ~~Approval~~ACCOUNTING ~~and Future Ratification~~POLICIES

~~The~~These ~~Rights~~items ~~Plan~~are ~~requires~~substantially ~~shareholder~~unchanged ~~approval~~as ~~and,~~discussed ~~accordingly,~~in at the ~~Meeting,~~Company’s ~~shareholders~~MD&A ~~will be~~for ~~asked to approve~~ the ~~Rights~~year ~~Plan~~ended November 30, 2006 as ~~summarized~~contained in ~~this~~our ~~information~~2006 ~~circular~~Annual ~~and~~Report ~~as more~~filed ~~particularly~~on ~~described~~SEDAR inat ~~the~~www.sedar.com ~~full~~or ~~text~~our annual ofForm ~~the~~20-F ~~Rights~~report ~~Plan~~filed ~~available~~on ~~for~~EDGAR ~~review~~ at ~~the Company’s registered and records office~~www. ~~The following is the text of the proposed resolution:~~sec.gov.

22CHANGE IN ACCOUNTING POLICIES

~~“BE~~In ITline ~~RESOLVED~~with ~~THAT:~~the conversion to Canadian GAAP, the Company has adopted the provisions of CICA Handbook Section 3855 Financial Instruments – Recognition and Measurement, CICA Handbook Section 3861 Financial Instruments – Presentation and Disclosure, CICA Handbook Section 3865 Hedges and CICA Handbook Section 1530 Comprehensive Income. These provisions became effective for the fiscal year beginning December 1, 2006.

1.		The Shareholder Rights Plan Agreement dated as of April 19, 2001 and amended and restated on March 19, 2007, between the Company and Computershare Investor Services Inc., as Rights Agent, as adopted by the Board of Directors of the Company on March 19, 2007, and the issuance of the rights to holders of common shares of the Company substantially in accordance with the terms and conditions of such Shareholder Rights Plan Agreement, is hereby ratified, confirmed and approved; and
2.		any director or senior officer of the Company be, and is hereby authorized and directed, for and on behalf of and in the name of the Company, to do all such acts and things and to execute, whether under the corporate seal of the Company or otherwise, and deliver all such documents and instruments as may be considered necessary or desirable to give effect to the foregoing.”

(i) Financial Instruments – Recognition and Measurement

IfThis standard prescribes the ~~Rights~~recognition ~~Plan~~and ~~Resolution~~measurement isof ~~not~~financial ~~approved,~~instruments. ~~the~~Section 3855 requires ~~Rights~~that ~~Plan~~all ~~will~~financial ~~immediately~~assets ~~terminate~~and liabilities (including derivatives) be measured at fair value on initial recognition except for certain related party transactions. Measurement in subsequent periods depends on the classification of the instruments. All financial instruments must be classified as one of the following

InPage ~~addition,~~15 ~~the Rights Agreement provides that the continued existence~~ of ~~the Rights Plan must be~~18 ratified by a majority of the shareholders of the company at its extraordinary general meeting three years following the Meeting. Subject to shareholder approval and future shareholder ratification, the Rights Plan will have a term of six years.

~~DISCLOSURE~~OSI ~~RESPECTING~~Geospatial ~~SECURITY-BASED~~Inc. Management’s ~~COMPENSATION~~Discussion ~~ARRANGEMENTS~~and Analysis For the three and nine months ended August 31, 2007 (expressed in U.S. dollars)

~~The~~categories: ~~TSX~~held ~~requires~~for ~~that~~trading, ~~issuers~~held ~~disclose~~to the terms of any security based compensation arrangements which they have in place. The only security based compensation arrangements which the Company has in place are its three incentive stock option plans (collectively the “Stock Option Plans”) which were adopted in 1994maturity, ~~1996~~loans and ~~1998. All three Stock Option Plans were approved by the TSX and by the shareholders of the Company by way of disinterested vote~~receivables, and terms of all three are the same in all material respects except for the number of shares reserved for issuance under them. The Company has three Stock Option Plans because, historically, as the number of shares available for ~~granting~~ ~~under~~sale ~~one Stock Option Plan was depleted, the Company would adopt another plan. Since 1998~~assets the Company has amended its 1998 Stock Option Plan on three occasions to replenish the number of shares available for granting under the plans, rather then adopting a new plan. The information set out below is with respect to all three Stock Option Plans and ~~amendments~~other ~~combined~~financial ~~as if they were all one plan~~liabilities. ~~This information is being provided to meet the Company’s disclosure obligations under~~ ~~TSX policies. The Company is not seeking shareholder approval to amend any of the Stock Option Plans or to otherwise obtain approval for any security based compensation arrangements.~~

~~Eligible~~The ~~Participants~~financial assets categorized as held for trading are measured at fair value with unrealized gains and losses recognized in net income. Section 3855 permits an entity to designate any financial instruments as held for trading on initial recognition or adoption of this standard, even if that instrument would not otherwise meet the definition of held for trading as specified in Section 3855. The Company’s financial instruments classified as held for trading have included forward contracts and marketable securities, when used. The Company has historically measured these instruments at fair value and any unrealized gains and losses have been included in income. The Company’s accounting treatment of these instruments remains unchanged as a result of adoption of the new accounting standards.

~~Stock~~Available ~~options~~for ~~may~~sale befinancial ~~issued~~assets toare ~~directors,~~measured ~~senior~~at ~~officers,~~fair ~~employees,~~value ~~contractors,~~with ~~consultants,~~unrealized gains and losses ~~other~~recognized ~~service~~in ~~providers~~other ofcomprehensive ~~the~~income. The Company orcurrently ofhas ~~any~~no ofassets ~~its~~classified ~~affiliates~~as available orfor ~~subsidiaries~~sale.

~~Number~~The offinancial ~~Securities~~assets ~~Issued~~classified as loans and ~~Issuable~~receivables and held to maturity are measured at amortized cost. There is no change in accounting treatment for these financial instruments as a result of adoption of Section 3855.

~~Each~~(ii) Financial ~~stock~~Instruments ~~option~~– ~~granted~~Presentation ~~under the Stock Option Plans is exercisable into one common share of the Company. As of the date of this information circular, a total of 3,417,584 stock options have been granted~~ and ~~are unexercised, representing 8.9% of the total issued and outstanding common shares of~~Disclosure the Company. In addition, a total of 946,910 stock options are issuable under the Stock Option Plans as of the date hereof, representing 2.5% of the number of common shares currently outstanding. The total number of stock options issued and issuable under the Stock Option Plans as of the date hereof represent 11.4% of the total issued and outstanding shares of the Company.

23CICA Handbook Section 3861 establishes standards for presentation of financial instruments and non-financial derivatives, and identifies the information that should be disclosed about them. Effective December 1, 2007, the Company will be required to adopt two new CICA standards: Section 3862 Financial Instruments – Disclosures; and Section 3863 Financial Instruments – Presentation, which will replace Section 3861 Financial Instruments – Disclosure and Presentation. The new disclosure standard increases the emphasis on the risks associated with both recognized and unrecognized financial instruments and how those risks are managed. The new presentation standard carries forward the former presentation requirements. The new financial instruments presentation and disclosure requirements were issued in December 2006 and the Company is assessing the impact on its consolidated financial statements.

~~Maximum Stock Options per Person~~(iii) Hedges

~~The~~This ~~number~~standard sets out the criteria of ~~shares~~when ~~reserved~~hedge ~~for~~accounting ~~issuance~~is toapplied ~~any~~and ~~one~~how ~~stock~~it is applied. It provides the option ~~holder~~of ~~pursuant~~designating toqualifying ~~stock~~transactions ~~options~~as hedges for accounting purposes. The ~~granted~~qualifying ~~under~~hedging ~~the~~relationships ~~Stock~~include ~~Option~~fair ~~Plans~~value ~~may~~hedges, ~~not~~cash ~~exceed~~flow 5%hedges, and hedges of foreign currency exposures of net investments in self-sustaining foreign operations. The changes in the fair ~~outstanding~~value ~~common~~of ~~shares~~the hedging derivatives will be recognized in net earnings or other comprehensive income depending on the nature of the hedging relationships. Any gains and losses resulting from any ineffectiveness in hedging relationships are recognized in net income immediately. The Company does atnot ~~the~~currently ~~time~~have any hedges and as a result there is no change on adoption of ~~grant~~Section 3865.

~~Exercise~~(iv) Comprehensive ~~Price~~Income

~~The~~This ~~exercise~~section ~~price~~establishes standards for the reporting and disclosure of ~~stock~~other ~~options~~comprehensive ~~granted~~income [“OCI”] ~~under~~in ~~the~~a ~~Stock~~new ~~Option~~category, ~~Plans~~Accumulated isComprehensive ~~set~~Income, bywhich ~~the~~will ~~Board~~be atadded ~~the~~to shareholders’ ~~time~~equity ~~that~~on the ~~stock~~consolidated ~~options~~balance ~~are granted~~sheet. ~~The~~Comprehensive ~~exercise~~income ~~price~~includes ~~must~~all bechanges ~~not~~in ~~less~~equity ~~than~~of the Company during a ~~price~~period ~~equal~~except tothose resulting from investments by shareholders and ~~the~~distributions ~~closing~~to ~~price~~shareholders. ofThe ~~the~~major ~~Company’s~~components ~~common~~included ~~shares~~in onAccumulated ~~the~~Comprehensive ~~TSX~~Income are unrealized gains and losses on ~~the~~financial ~~date~~assets ~~immediately~~classified ~~preceding~~as ~~the~~available for sale, and ~~date~~unrealized foreign exchange gains and losses arising on translation of ~~grant~~the financial statements of self-sustaining foreign operations.

NoAs ~~Assignment~~a result of previously preparing the Company’s financial statements in accordance with U.S. GAAP,

~~The~~Page ~~stock~~16 ~~options~~of ~~may not be assigned or transferred.~~18

~~Vesting~~OSI Geospatial Inc. Management’s Discussion and Analysis For the three and nine months ended August 31, 2007 (expressed in U.S. dollars)

~~The~~the ~~Board~~adoption ~~has~~of ~~discretion~~Section 1530 toalongside ~~impose~~the ~~terms~~conversion ~~and conditions as~~ to ~~the~~Canadian ~~vesting~~GAAP ofhas ~~stock~~not ~~options.~~resulted ~~Any~~in any ~~vesting~~change ~~provisions~~in ~~are~~disclosure ~~set~~on at the ~~time~~Company’s ~~that~~balance ~~the stock options are granted~~sheet.

~~Term~~FINANCIAL INSTRUMENTS AND OTHER INSTRUMENTS

~~The~~Foreign ~~term~~Exchange ofForward ~~stock options is set by the Board at the time of grant. No maximum term is prescribed~~Contracts ~~under the Stock Option Plans. To date no options have ever been granted by the Board for a term exceeding five years.~~

~~Termination~~The Company’s Canadian subsidiaries use foreign exchange forward contracts to reduce their exposure on transactions denominated in U.S. dollars, Australian dollars, British pounds and euros. The purpose of ~~Options~~these contracts is to reduce the level of exposure to exchange rate movements.

~~The~~Derivative ~~provisions~~financial ~~respecting~~instruments ~~termination~~are ofutilized ~~stock options may be set~~ by the ~~Board.~~Company Ifto ~~the~~reduce ~~Board~~our ~~does not~~exposure soto ~~specify, stock options held by an optionee terminate after the earliest of (i) three months~~fluctuations ~~after~~in ~~the~~foreign ~~optionee’s~~exchange ~~employment~~on ~~terminates~~certain bycommitted ~~reason~~and ofanticipated ~~his~~transactions. ~~disability~~Derivatives orare ~~retirement,~~recorded ~~(ii) 12~~as ~~months~~assets ~~after his~~ or ~~her death (in which case his or her estate may exercise them)~~liabilities, ~~(iii) 30 days from~~measured ~~the~~at ~~date~~fair ~~of termination of the optionee’s employment with the Company other than by reason of death, disability or retirement~~value. ~~Generally~~Derivatives ~~speaking,~~instruments ifare anadjusted ~~employee~~to isfair ~~terminated without cause,~~value ~~the~~through ~~Board~~income ~~will allow the employee to retain his~~ or ~~her stock options for the unexpired term of the stock options~~loss.

~~Amendments~~At toAugust 31, ~~Stock~~2007, ~~Option~~we ~~Plans~~had not entered into any foreign exchange forward or other derivative contracts.

NoDISCLOSURE ~~material~~OF ~~amendments~~OUTSTANDING ~~may~~SHARE ~~be made to the Stock Option Plans without the approval of the TSX and~~DATA ~~the Company’s shareholders by way of disinterested vote.~~

~~Financial~~As ~~Assistance~~at September 30, 2007, we had 42,242,326 issued and outstanding common shares and 3,141,166 outstanding stock options. As at September 30, 2007, we also had 30,262 issued and outstanding class A preference shares and 190,670 issued and outstanding class B preference shares series 2 convertible into common shares at conversion ratios of 1:1 and 1:58.82353 respectively which represents 11,215,588 common shares. Also at September 30, 2007, we had 16,568,368 outstanding common share purchase warrants convertible to common shares at a conversion ratio of 1:1, representing 16,568,368 common shares.

~~The~~DISCLOSURE ~~Company~~CONTROLS ~~does~~AND ~~not provide financial assistance to optionees to facilitate the exercise of their~~PROCEDURES ~~options. The Company’s Stock Option Plans contain provisions for the creation of a payroll deduction plan to fund option exercises, but the Company has not implemented such a plan.~~

~~PARTICULARS~~The OFCompany ~~OTHER~~maintained ~~MATTERS~~a TOset BEof ~~ACTED~~disclosure ~~UPON~~controls and procedures during the three and nine months ended August 31, 2007 designed to ensure that information required to be disclosed is recorded, processed, summarized and reported within the time periods specified in provincial securities legislation as defined under Multilateral Instrument 52-109. The Chief Executive Officer and the Vice President Finance have determined that there were no changes to the company’s disclosure controls and procedures during the three and nine month period ended August 31, 2007 that have materially affected, or are likely to materially affect the design and operation of these disclosure controls and procedures.

~~Management~~INTERNAL ofCONTROLS ~~the~~OVER ~~Company~~FINANCIAL ~~knows of no matters to come before the Meeting other than those referred~~REPORTING ~~to in the Notice of Meeting accompanying this Information Circular. However, if any other matters properly come before the Meeting, it is the intention of the persons named in the form of~~

24The Company maintains internal controls over financial reporting which have been designed to provide reasonable assurance of the reliability of external financial reporting as required by Multilateral Instrument 52-109. The Chief Executive Officer and the Vice President Finance, along with other employees to the extent considered necessary and appropriate, have designed internal controls over financial reporting that are effective as at August 31, 2007.

~~proxy~~Nonetheless, ~~accompanying~~the ~~this~~Chief ~~Information~~Executive ~~Circular~~Officer and the Vice President Finance have identified areas where the Company can enhance process controls and they intend to ~~vote~~incorporate such enhancements into the internal ~~same~~controls inover ~~accordance~~financial ~~with~~reporting ~~their~~during ~~best~~the current fiscal year. The Company employs ~~judgment~~entity level controls to compensate for any deficiencies that may exist. Under 52-109, the Chief Executive Officer and the Vice President Finance are not required to, and have not yet tested the actual effectiveness of ~~such~~the ~~matters~~Company’s internal controls over financial reporting.

~~ADDITIONAL~~Page ~~INFORMATION~~17 of 18

~~Additional~~OSI ~~information~~Geospatial ~~respecting the Company is available on the SEDAR website at www~~Inc.~~sedar.com or~~ ~~the Company~~Management’s ~~web~~Discussion ~~site~~and ~~at www.osigeospatial.com. Securityholders may contact the Company to request~~Analysis ~~copies~~For of the ~~Company’s~~three ~~financial~~and ~~statements~~nine ~~and~~months ~~management’s~~ended ~~discussion~~August 31, ~~and~~2007 (expressed ~~analysis~~in atU.S. ~~the~~dollars) ~~following address:~~

~~OSI~~There ~~GEOSPATIAL~~were ~~INC.~~no changes in the Company’s internal controls over financial reporting that occurred ~~Suite 107~~since –the ~~930~~beginning ~~West~~of ~~1st~~the ~~Street~~Company’s current fiscal year to the date of this document that have ~~North~~materially ~~Vancouver~~affected, ~~British~~or ~~Columbia,~~are ~~V7P~~likely ~~3N4 Canada Phone:~~to ~~604-904-4600~~materially affect the Company’s internal controls over ~~Email:~~financial ~~invest@osigeospatial~~reporting.~~com~~

~~Financial~~RISKS ~~information~~AND ~~is provided in the Company’s comparative financial statements and~~UNCERTAINTIES ~~management’s discussion and analysis for the financial year ended November 30, 2006.~~

~~BOARD~~The ~~APPROVAL~~primary risks and uncertainties that affect and may affect the Company and its business, financial condition and results of operations are substantially unchanged as discussed in the company’s MD&A for the year ended November 30, 2006 as contained in our 2006 Annual Report filed on SEDAR at www.sedar.com or our annual Form 20-F which will be reported on EDGAR at www.sec.gov.

~~The~~Page ~~contents~~18 ~~and sending~~ of ~~this Information Circular have been approved by the Board of Directors~~18 ~~of the Company.~~

ONOSI ~~BEHALF~~Geospatial ~~OF THE BOARD OF DIRECTORS~~Inc.

~~KENNETH~~Interim ~~KIRKPATRICK~~Consolidated Financial Statements (Unaudited) ~~President~~Three and ~~Chief~~Nine ~~Executive~~Months ~~Officer~~ended August 31, 2007 and 2006 (expressed in U.S. dollars)

~~JOHN~~(Prepared T.in ~~SENTJENS~~accordance with Canadian Generally Accepted Accounting Principles) ~~Secretary~~

25OSI Geospatial Inc. (Incorporated under the laws of the Province of British Columbia, Canada) Consolidated Balance Sheets (unaudited)

SCHEDULE A TO THE INFORMATION CIRCULAR OF OSI GEOSPATIAL INC. (“OSI”)


In thousands of U.S. dollars	August 31, 2007			November 30, 2006

Assets
Current assets
Cash	$	202		$	—
Accounts receivable (note 5)		10,425			12,707
Income taxes recoverable		173			28
Inventory (note 6)		1,336			1,063
Prepaid expenses and deposits		549			535

Current portion of future income tax asset		90			—

		12,775			14,333
Future income tax asset		49			—

Equipment and furnishings		1,690			1,089
Intangible and other assets		698			794
Goodwill		8,330			8,129

	$	23,542		$	24,345


Liabilities
Current liabilities
Bank indebtedness	$	—		$	904
Accounts payable and accrued liabilities		4,011			4,887
Income taxes payable		54			86
Unearned revenue		452			667
Current portion of deferred rent		36			—
Current portion of future income tax liability		17			—

		4,570			6,544
Deferred rent		342			—
Future income tax liability		83			20

		4,995			6,564


Commitments and contingency (note 8)

Shareholders’ Equity
Issued and outstanding
30,262 Class A Series A preference shares (November 30, 2006 – 30,262) (note 7a)		19			19
190,670 Class B, Series 2 preference shares (November 30, 2006 – 279,840) (note 7b)		4,850			7,115
46,242,326 common shares (November 30, 2006 – 35,137,046) (note 7b)		21,058			15,887

		25,927			23,021
Warrants		4,618			4,286
Contributed surplus		1,562			1,343
Accumulated deficit		(15,806	)		(13,296	)
Accumulated other comprehensive income		2,246			2,427

		18,547			17,781

	$	23,542		$	24,345

~~BOARD~~The OFaccompanying ~~DIRECTORS’~~notes ~~MANDATE~~are an integral part of the consolidated financial statements.

~~The~~OSI ~~board~~Geospatial ofInc. Consolidated ~~directors~~Statements of ~~the~~Operations ~~Corporation has overall responsibility for the stewardship of the~~(unaudited) ~~Corporation, including responsibility for:~~

(a) adoption of a strategic planning process and approval and review, on at least an annual basis, of a strategic plan which takes into account, among other things, the opportunities and risks of the Corporation’s business; (b) identification of the principal risks of the Corporation’s business and ensuring the implementation of appropriate systems to manage these risks; (c) succession planning, including appointing, training and monitoring senior management in general and the CEO in particular; (d) communication policies for the Corporation, which policies should (i) address how the Corporation interacts with analysts, investors, other key stakeholders and the public; (ii) contain measures for the Corporation to comply with its continuous and timely disclosure obligations and to avoid selective disclosure; and (iii) be reviewed at least annually; (e) the integrity of the Corporation’s internal control and management information systems; (f) developing the Corporation’s approach to corporate governance issues; and (g) assessing the effectiveness of the Board, the recruitment of new directors and the provision of orientation and education programs for new directors.


	Three months ended August 31,						Nine months ended August 31,
In thousands of U.S. dollars, except share related data	2007			2006			2007			2006

Revenue
Marine systems	$	3,124		$	1,240		$	6,267		$	4,958
Land and air systems		2,627			2,022			7,294			6,244
Mapping		1,591			1,054			3,489			2,917

		7,342			4,316			17,050			14,119

Cost of sales		4,294			2,913			10,878			8,927


Gross profit		3,048			1,403			6,172			5,192

Expenses
General and administrative		1,451			1,460			4,249			4,320
Engineering		231			389			1,101			1,382
Sales and marketing		755			510			2,252			1,668
Depreciation and amortization		75			142			220			412
Interest expense		22			3			48			15
Interest income		—			—			(7	)		(20	)
Foreign exchange loss (gain)		43			(18	)		65			(18	)
Loss on sale of fixed assets		—			2			—			2
Technology Partnerships Canada royalty		139			55			276			220
Technology Partnerships Canada contribution		—			(227	)		—			(731	)

		2,716			2,316			8,204			7,250

Net earnings (loss) before income taxes		332			(913	)		(2,032	)		(2,058	)


Future income tax recovery		(10	)		(117	)		(59	)		(140	)
Current income tax expense (recovery)		63			(87	)		103			(65	)

Income tax expense (note 9)		53			(204	)		44			(205	)

Net earnings (loss)	$	279		$	(709	)	$	(2,076	)	$	(1,853	)

Net earnings (loss) available to common shareholders (note 7d)	$	109		$	(972	)	$	(2,628	)	$	(2,642	)


Earnings (loss) per share (note 7d) — basic and diluted	$	0.00		$	(0.03	)	$	(0.07	)	$	(0.08	)

Weighted average number of common shares outstanding (note 7d) – basic and diluted		42,377,958			32,891,635			39,635,112			32,160,508

Dividends declared per share
Class B preference shares – Series 2	$	—		$	—		$	1.64		$	1.59

~~Strategic~~The ~~Planning~~accompanying notes are an integral part of the consolidated financial statements.

~~Senior~~OSI ~~management~~Geospatial ~~of the Corporation must develop long-term strategies with respect to the~~Inc. ~~Corporation’s~~Consolidated ~~operations~~Statements ~~to be adopted by the board~~ of ~~directors.~~Shareholders’ ~~The~~Equity ~~strategies~~and ~~are~~Accumulated toDeficit be(unaudited) ~~reviewed~~For ~~and updated not less than annually and otherwise as reasonably required. Included in~~ the ~~development~~ ofnine ~~these~~months ~~long-term~~ended ~~strategies will be annual strategic~~August 31, ~~operating and capital plans.~~2007 ~~The strategic plan is to take into account, among other things, the opportunities and risks of the~~ ~~Corporation’s business.~~

Identification and Management of Risks


In thousands of U.S. dollars except share numbers
	Units
Class A preference shares
Balance at November 30, 2006		30,262		$	19

Balance at August 31, 2007		30,262		$	19


Class B preference shares
Balance at November 30, 2006		279,840		$	7,115
Class B preference shares converted to common shares		(89,170	)		(2,265	)

Balance at August 31, 2007		190,670		$	4,850


Common shares
Balance at November 30, 2006		35,137,046		$	15,887
Class B preference shares converted to common shares		5,245,280			2,265
Shares issued		5,860,000			3,219
Share issue costs, net of tax benefit					(313	)

Balance at August 31, 2007		46,242,326		$	21,058


Warrants
Balance at November 30, 2006		13,788,368		$	4,286
Warrants issued		2,780,000			332

Balance at August 31, 2007		16,568,368		$	4,618


Contributed surplus
Balance at November 30, 2006				$	1,343
Share based broker compensation					74
Stock-based compensation					145

Balance at August 31, 2007				$	1,562


Accumulated deficit
Balance at November 30, 2006				$	(13,296	)
Dividends on Class B preference shares					(382	)
Tax expense on dividends					(52	)
Net loss for the period					(2,076	)

Balance at August 31, 2007				$	(15,806	)


Accumulated other comprehensive income
Foreign currency translation adjustment
Balance at November 30, 2006				$	2,427
Adjustment for the period					(181	)

Balance at August 31, 2007				$	2,246


Total shareholders’ equity				$	18,547

The ~~board~~accompanying ofnotes ~~directors has the responsibility to identify the principal risks of the Corporation’s business and must, with management, establish systems and procedures to ensure that these risks~~ are ~~monitored.~~ ~~These~~an ~~systems~~integral ~~and~~part ~~procedures must include the effective management~~ of the ~~Corporation’s assets~~consolidated ~~and~~ financial ~~resources, and must ensure compliance with all regulatory obligations~~statements.

~~Supervision~~OSI ~~and~~Geospatial ~~Succession~~Inc. Consolidated Statements of ~~Management~~Cash Flows (unaudited) Three and Nine Months Ended August 31, 2007 and 2006

The board of directors is responsible for the supervision of senior management to ensure that the operations of the Corporation are conducted in accordance with objectives set by the board. The


	Three Months ended August 31,						Nine months ended August 31,
In thousands of U.S. dollars	2007			2006			2007			2006

Cash flows from (used in) operating activities
Net earnings (loss) for the period	$	279		$	(709	)	$	(2,076	)	$	(1,853	)
Items not affecting cash
Depreciation and amortization		129			191			377			580
Stock-based compensation		5			—			145			104
Future income taxes		(83	)		(116	)		(177	)		(73	)


		330			(634	)		(1,731	)		(1,309	)


Changes in non-cash working capital items
Accounts receivable		(2,644	)		690			2,504			4,326
Inventory		96			(190	)		(155	)		(300	)
Prepaid expenses and deposits		75			(151	)		36			(59	)
Accounts payable and accrued liabilities		367			(167	)		(1,381	)		(1,387	)
Income taxes payable		87			(85	)		(143	)		(256	)
Unearned revenue		(57	)		12			(330	)		390
Deferred rent		363			—			363			—


		(1,713	)		109			894			2,714


		(1,383	)		(525	)		(837	)		1,405

Cash flows from (used in) investing activities
Purchase of CHI Systems Inc., net of cash acquired (note 4b)		—			(4	)		—			(8,127	)
Purchase of Liddy International Inc. (note 4a)		—			—			(25	)		—
Decrease (increase) in marketable securities		—			16			—			(143	)
Decrease in restricted cash		—			—			—			129
Additions to equipment and furnishings		(111	)		—			(225	)		(83	)
Additions to leasehold improvements		(540	)					(540	)
Additions to intangibles and other assets		—			(12	)		(31	)		(109	)


		(651	)		—			(821	)		(8,333	)

Cash flows from (used in) financing activities

Payments to operating line of credit		(548	)		—			(904	)		—
Issue of common shares		2,812			53			2,812			59
Issue of warrants		332			—			332			—
Class B preference share dividends		(382	)		—			(382	)		(527	)


		2,214			53			1,858			(468	)


Effect of foreign exchange on cash		22			(34	)		2			87


Increase (decrease) in cash		202			(506	)		202			(7,309	)

Cash – beginning of period		—			1,419			—			8,222


Cash – end of period	$	202		$	913		$	202		$	913

26The accompanying notes are an integral part of the consolidated financial statements.

~~board~~OSI ~~must~~Geospatial ~~approve~~Inc. Notes ~~all~~to ~~appointments~~the ofConsolidated ~~senior~~Financial ~~management~~Statements (unaudited) Three and, asNine ~~part~~Months ofEnded ~~the Corporation’s planning process~~August 31, ~~review~~2007 and ~~discuss succession planning for senior management positions.~~2006

Corporate Disclosure Policy

1		Basis of presentation

		These unaudited interim consolidated financial statements have been prepared by management and include the accounts of OSI Geospatial Inc. and its subsidiaries, collectively referred to as OSI Geospatial or the Company. These unaudited interim consolidated financial statements have been prepared in accordance with generally accepted accounting principles in Canada (“Canadian GAAP”) and all amounts have been expressed in thousands of U.S. dollars unless otherwise noted.

		The annual and interim consolidated financial statements issued to date in 2007, 2006 and 2005 were prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”). These previously released financial statements included a reconciliation to Canadian GAAP. The Company has restated all comparative amounts presented in the financial statements in accordance with Canadian GAAP and will re-issue the unaudited interim consolidated financial statements for the quarters ended February 28, 2007 and May 31, 2007, including full comparative information presented in accordance with Canadian GAAP.

		These unaudited interim consolidated financial statements do not include all the information and footnote disclosures required by Canadian GAAP for annual financial statements. These unaudited interim consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto.

		On April 12, 2006 at the Company’s annual general meeting its shareholders voted in favor of changing the Company’s name from Offshore Systems International Ltd. to OSI Geospatial Inc. The name change was effective June 5, 2006. For the purposes of this report, the Company is referred to by its new legal identity.

		The preparation of these unaudited interim consolidated financial statements and requires management to make estimates and assumptions that affect the amounts reported. Actual results could vary from these estimates and the operating results for the interim period presented are not necessarily indicative of the results expected for the full year.

2		Nature of operations

		OSI Geospatial Inc. designs, develops, and markets software and systems for enhancing situational awareness in command, control, and intelligence applications. OSI Geospatial’s principal product is the proprietary ECPINS^® line of electronic chart navigation systems for commercial and military customers. OSI Geospatial conducts its operations through three business units – International Systems Operations, U.S. Systems Operations and Mapping Operations. The Company’s International and U.S. Systems business units develop and produce geographic information display systems and software for the marine navigation, and command and control markets, and situational awareness products for land-based and aeronautical command and control markets. The Company’s Mapping business unit provides digital land map and electronic nautical chart production services, and produces and distributes electronic nautical chart data.

3		Accounting changes

The Corporation’s Corporate Disclosure Policy is incorporated in the Written Disclosure Policy of the Corporation and is available on its Web Site at www.osigeospatial.com. Following it will ensure that all material issues relating to the Corporation are communicated to shareholders and other stakeholders adequately. It includes provisions regarding the release of annual and quarterly reports and press releases.

	a)		Changes in accounting policies

	In line with the conversion to Canadian GAAP referred to in Note 1 above, the Company has adopted the provisions of CICA Handbook Section 3855 Financial Instruments – Recognition and Measurement, CICA Handbook Section 3861 Financial Instruments – Presentation and Disclosure, CICA Handbook Section 3865 Hedges and CICA Handbook Section 1530 Comprehensive Income. These provisions became effective for the fiscal year beginning December 1, 2006.

	(i)		Financial Instruments – Recognition and Measurement

In ~~addition~~Page ~~to annual general meetings, meetings will be held from time to time in each year~~1 between management and various investors, investment analysts, credit rating agencies and financial institutions. Selective disclosure to investors and investment analysts is not permitted and the Corporate Disclosure Policy contains measures to ensure this does not occur.

~~The~~OSI ~~Corporate~~Geospatial ~~Disclosure~~Inc.Notes ~~Policy~~to ~~must~~the beConsolidated ~~reviewed~~Financial ~~annually~~Statements by(unaudited) Three ~~the~~and ~~board.~~Nine Months Ended August 31, 2007 and 2006

~~Internal~~This ~~Control~~ standard prescribes the recognition and measurement of financial instruments. Section 3855 requires that all financial assets and liabilities (including derivatives) be measured at fair value on initial recognition except for certain related party transactions. Measurement in subsequent periods depends on the classification of the instruments. All financial instruments must be classified as one of the following categories: held for trading, held to maturity, loans and receivables, available for sale assets and other financial liabilities. The financial assets categorized as held for trading are measured at fair value with unrealized gains and losses recognized in net income. Section 3855 permits an entity to designate any financial instruments as held for trading on initial recognition or adoption of this standard, even if that instrument would not otherwise meet the definition of held for trading as specified in Section 3855. The Company’s financial instruments classified as held for trading have included forward contracts and marketable securities, when used. The Company has historically measured these instruments at fair value and any unrealized gains and losses have been included in income. Available for sale financial assets are measured at fair value with unrealized gains and losses recognized in other comprehensive income. The Company currently has no assets classified as available for sale. The financial assets classified as loans and receivables and held to maturity are measured at amortized cost. There is no change in accounting treatment for these financial instruments as a result of adoption of Section 3855. (ii) Financial Instruments – Presentation and Disclosure CICA Handbook Section 3861 establishes standards for presentation of financial instruments and non-financial derivatives, and identifies the information that should be disclosed about them. Effective December 1, 2007, the Company will be required to adopt two new CICA standards: Section 3862 Financial Instruments – Disclosures; and Section 3863 Financial Instruments – Presentation, which will replace Section 3861 Financial Instruments – Disclosure and Presentation. The new disclosure standard increases the emphasis on the risks associated with both recognized and unrecognized financial instruments and how those risks are managed. The new presentation standard carries forward the former presentation requirements. The new financial instruments presentation and disclosure requirements were issued in December 2006 and the Company is assessing the impact on its consolidated financial statements. (iii) Hedges This standard sets out the criteria of when hedge accounting is applied and how it is applied. It provides the option of designating qualifying transactions as hedges for accounting purposes. The qualifying hedging relationships include fair value hedges, cash flow hedges, and hedges of foreign currency exposures of net investments in self-sustaining foreign operations. The changes in the fair value of the hedging derivatives will be recognized in net earnings or other comprehensive income depending on the nature of the hedging relationships. Any gains and losses resulting from any ineffectiveness in hedging relationships are recognized in net income immediately. The Company does not currently have any hedges and as a result there is no change on adoption of Section 3865. (iv) Comprehensive Income This section establishes standards for the reporting and disclosure of other comprehensive income [“OCI”] in a new category, Accumulated Comprehensive Income, which will be added to shareholders’ equity on the consolidated balance sheet. Comprehensive income includes all changes in equity of the Company during a period except those resulting from investments by shareholders and distributions to shareholders. The major components included in Accumulated Comprehensive Income are unrealized gains and losses on financial assets classified as available for sale, and unrealized foreign exchange gains and losses arising on translation of the financial statements of self-sustaining foreign operations.

~~The~~ ~~board~~Page ~~of directors, through the Audit Committee, is responsible for the integrity of the~~2 internal control and management information systems of the Corporation. The duties of the Audit Committee are discussed in the Company’s annual information form. Please refer to the annual information form for this information. The annual information form is available on SEDAR at www.sedar.com.

~~Securities~~OSI ~~Trading~~Geospatial ~~Policy~~Inc. Notes to the Consolidated Financial Statements (unaudited) Three and Nine Months Ended August 31, 2007 and 2006

~~The~~As ~~Corporation’s~~a ~~Securities~~result ~~Trading~~of ~~Policy~~previously ~~sets~~preparing ~~out~~the ~~Blackout~~Company’s ~~Periods~~financial ~~during~~statements ~~which~~in ~~trading~~accordance ~~in securities~~with ofU.S. GAAP, the ~~Corporation~~adoption isof ~~prohibited~~Section ~~and~~1530 isalongside ~~incorporated~~the inconversion ~~the~~to ~~Written~~Canadian ~~Disclosure~~GAAP ~~Policy~~has ~~of the~~not ~~Corporation.~~resulted Itin isany ~~available~~change in disclosure on the ~~Corporation~~Company’~~sWeb~~s ~~Site~~balance ~~at www~~sheet.~~osigeospatial.com.~~

Outside Advisors

	b)		Change in reporting currency

	Effective March 1, 2006, the Company adopted the U.S. dollar as its reporting currency. In general this change results from an increase in the overall proportion of business activities conducted in U.S. dollars. The change was effected by translating assets and liabilities at the existing U.S./Canadian dollar foreign exchange spot rate on the last day of the month, while earnings were translated at the average rate for each month. Equity transactions have been translated at historical rates; with opening equity restated at the rate of exchange on December 1, 2001. The resulting net translation adjustment has been credited to the foreign currency translation adjustment.

			Prior to March 1, 2006, the reporting currency of the Company was Canadian dollars.

An4 ~~individual director may engage an outside advisor at the expense of the Corporation in appropriate circumstances and subject to approval of the Executive Committee of the board.~~ Acquisitions

Independence of the Board

	a)		Liddy International Inc.

	On April 23, 2007, the Company through its subsidiary CHI Systems Inc., acquired the assets of Liddy International Inc. (“Liddy”), a United States defense contracting company and established Layered Security Solutions (“LSS”). LSS provides business continuity solutions against hazards and has the capability to develop deterrence, response and recovery strategies designed to deal with global threats to business and government. Under the terms of the agreement, the Company paid approximately $184,000 for assets and goodwill of Liddy, of which $25,000 was paid in cash with the balance paid by the issuance of 300,000 common shares of the Company of which 200,000 common shares are held in escrow subject to the satisfaction of certain contractual provisions.

	The following table summarizes the fair value of the assets acquired by the Company at April 23, 2007, the date of acquisition. The acquisition was accounted for using the purchase method whereby assets acquired were recorded at their fair values at April 23, 2007. The excess of the purchase price over the fair market value was recorded as goodwill. The allocation of the purchase price is preliminary and the final allocation may be subject to refinement in the next three months subject to the final review by an independent business valuator.

In order to ensure that the board of directors can function independently of management, it must:


In thousands of U.S. dollars
Assets
Furniture and Fixtures	$	8
Computer Equipment		17
Goodwill		200

Total assets acquired		225


Net assets acquired (cash and common share consideration)		184
Direct acquisition costs incurred by the Company		41


Total acquisition costs	$	225

Less fair value of net identifiable assets acquired		25


Goodwill		200

(a) appoint a chair of the board who is not a member of management who will have responsibility to ensure the board discharges its responsibilities; or (b) assign this responsibility to an outside director known as the lead director. The ~~chair~~assets oracquired ~~lead~~are ~~director~~fully ~~should~~deductible ~~ensure~~for ~~that~~US ~~the~~tax ~~board:~~purposes.

~~(i)~~ ~~understand~~Page the boundaries between the board and management responsibilities; (ii) address its responsibilities under this Corporate Governance Policy; and (iii) meet on a regular basis without management present.3

27OSI Geospatial Inc. Notes to the Consolidated Financial Statements (unaudited) Three and Nine Months Ended August 31, 2007 and 2006

~~OSI~~b) ~~Geospatial~~CHI Systems Inc. On December 14, 2005, the Company acquired CHI Systems Inc. (“CHI Systems”), a United States defense contracting company. CHI Systems has multiple offices in the United States and is a supplier of technology and services to the U.S. Department of Defense and key defense prime contractors. Under the terms of the agreement, the Company paid approximately $9.0 million for 100% of the outstanding shares of CHI Systems, of which $8.1 million was paid in cash with the balance paid by the issuance of 1,067,975 common shares of the Company. Information regarding this acquisition can be found in the company’s audited consolidated financial statements for the year ended November 30, 2006 as reported in our 2006 Annual Report filed on SEDAR at www.sedar.com or our annual Form 20-F reported on EDGAR at www.sec.gov. The results of CHI Systems’ operations have been included in the consolidated financial statements commencing December 14, 2005.

~~Security Class~~ 5 Accounts receivable

Holder Account Number


In thousands of U.S. dollars
	August 31,			November 30,
	2007			2006

Trade	$	5,232		$	5,143
Unbilled revenue		4,961			7,257
Technology Partnerships Canada contribution		32			269
Other		254			97
Allowance for doubtful accounts		(54	)		(59	)


	$	10,425		$	12,707

~~Form of~~6 ~~Proxy - Annual Meeting to be held on April 18, 2007~~ Inventory

This Form of Proxy is solicited by and on behalf of Management.


In thousands of U.S. dollars
	August 31, 2007		November 30, 2006

Materials and components	$	1,107	$	958
Finished goods		229		105


	$	1,336	$	1,063

~~Notes~~7 toCapital ~~proxy~~ Stock

~~1. Every holder has the right to appoint some other person or company of their choice, who need not be~~ a holder, to attend and act on their behalf at the meeting. If you wish to appoint a person or company other than the persons whose names are printed herein, please insert the name of your chosen proxyholder in the space provided (see reverse). 2.Class IfA ~~the~~preference securities are registered in the name of more than one owner (for example, joint ownership, trustees, executors, etc.), then all those registered should sign this proxy. If you are voting on behalf of a corporation or another individual you may be required to provide documentation evidencing your power to sign this proxy with signing capacity stated. 3. This proxy should be signed in the exact manner as the name appears on the proxy. 4. If this proxy is not dated, it will be deemed to bear the date on which it is mailed by Management to the holder. 5. The securities represented by this proxy will be voted as directed by the holder, however, if such a direction is not made in respect of any matter, this proxy will be voted as recommended by Management. 6. The securities represented by this proxy will be voted or withheld from voting, in accordance with the instructions of the holder, on any ballot that may be called for and, if the holder has specified a choice with respect to any matter to be acted on, the securities will be voted accordingly. 7. This proxy confers discretionary authority in respect of amendments to matters identified in the Notice of Meeting or other matters that may properly come before the meeting. 8. This proxy should be read in conjunction with the accompanying documentation provided by Management.shares

~~Proxies~~The ~~submitted~~Company ~~must~~has be30,262 ~~received~~(November by30, ~~5:00~~2006 pm– 30,262) ~~Eastern~~Class ~~Time~~A preference shares outstanding that have a value of $19,000 ~~on April 16~~(November 30, ~~2007~~2006 — $19,000) for financial statement purposes. These Class A preference shares are being held in escrow but are no longer subject to any escrow restrictions and may be converted at any time into common shares of the Company, by notice in writing from the holders.

~~VOTE~~b) ~~USING~~Issued ~~THE~~and ~~TELEPHONE~~outstanding ORcommon ~~INTERNET 24 HOURS A DAY 7 DAYS A WEEK!~~ shares

To Vote Using the Telephone To Vote Using the Internet

	(i)		During the nine months ended August 31, 2007, 89,170 Class B preference shares were converted into 5,245,280 common shares. The Class B preference shares were reduced, and the common shares were increased, by $2.3 million, the carrying value of the shares converted. An additional 300,000 common shares were issued as part of the Liddy acquisition (note 4a).

	(ii)		On July 31, 2007, the Company closed a private placement offering resulting in the placement of 5,560,000 units (the “Units”) of the Company at a price of $0.61 per Unit (CDN $0.65), for gross

•		Call the number listed BELOW from a touch tone telephone.		•		Go to the following web site: www.computershare.com/proxy
		1-866-732-VOTE (8683) Toll Free

Page 4

IfOSI ~~you~~Geospatial ~~vote~~Inc. Notes byto ~~telephone~~the orConsolidated ~~the~~Financial ~~Internet,~~Statements DO(unaudited) Three ~~NOT~~and ~~mail~~Nine ~~back~~Months ~~this~~Ended ~~proxy.~~August 31, 2007 and 2006

~~Voting~~proceeds byof ~~mail~~$3.4 ~~may~~million. beEach Unit consists of one common share and one-half of one common share purchase warrant. Each warrant entitles the ~~only~~holder ~~method~~to purchase one common share of the Company at a price of $0.75 per common share (CDN $0.80)for ~~securities~~a ~~held~~period inof 24 months expiring July 31, 2009. The gross proceeds from the ~~name~~private placement were allocated as follows: $3.1 million was allocated to the 5,560,000 common shares issued and $332,000 was allocated to the 2,780,000 warrants issued. Share issue costs associated with the private placement amounted to $322,000 and included a $74,000 broker compensation warrant entitling the broker to purchase up to 333,600 Units of the Company at a ~~corporation~~ ~~or securities~~price ~~being~~of ~~voted~~$0.61 onper ~~behalf~~Unit (CDN $0.65) for a period of ~~another~~24 ~~individual~~months from the closing of the offering.

~~Voting~~c) byStock ~~mail~~option or by Internet are the only methods by which a holder may appoint a person as proxyholder other than the Management nominees named on the reverse of this proxy. Instead of mailing this proxy, you may choose one of the two voting methods outlined above to vote this proxy. plans

ToA ~~vote~~summary byof ~~telephone~~the orstatus of the ~~Internet,~~Company’s ~~you~~stock ~~will~~option ~~need~~plans toat ~~provide~~August ~~your CONTROL NUMBER~~31, ~~HOLDER~~2007 ~~ACCOUNT NUMBER~~is ~~and~~as ~~ACCESS NUMBER listed below.~~ follows:

CONTROL NUMBER HOLDER ACCOUNT NUMBER ACCESS NUMBER


In U.S. dollars
				Weighted average
	Number of shares			exercise price
Outstanding – November 30, 2006		3,417,584		$	0.89
Granted		625,000			0.60
Cancelled		(203,000	)		0.87
Expired		(698,418	)		1.03

Outstanding – August 31, 2007		3,141,166		$	0.81

Exercisable – August 31, 2007		3,057,207		$	0.82

~~14FE07058~~Stock-based compensation For the three and nine months ended August 31, 2007 the Company incurred non-cash stock-based compensation expense of $5,000 and $145,000,related to 625,000 stock options granted (three and nine months ended August 31, 2006 — $nil and $104,000).E Of the options granted in the nine month period ended August 31, 2007, 521,000 options vested immediately, 52,000 will vest over one year and 52,000 will vest over two years from the grant date.~~SEDAR/000001/000001/i~~ The expense was included in general and administrative costs and was recorded in contributed surplus. The fair value of stock options was estimated using the Black-Scholes option pricing model using the following weighted average assumptions by grant year:

+ + Appointment of Proxyholder The undersigned (“Registered Shareholder”) of OSI Geospatial, Inc (the “Company”) hereby appoints: Kenneth Kirkpatrick, President and CEO of the Company, or failing him, John Sentjens, the Secretary of the Company, OR Print the name of the person you are appointing if this person is someone other than the Management Nominees listed herein.


	2007			2006

Risk-free interest rate		4.09	%		2.98	%
Volatility		49	%		54	%
Estimated average option lives	5 years			5 years
Dividend yield		0.0	%		0.0	%

as ~~my/our~~Page ~~proxyholder with full power of substitution and to vote in accordance~~5 with the following direction (or if no directions have been given, as the proxyholder sees fit) and all other matters that may properly come before the Annual Meeting of OSI Geospatial, Inc to be held at the Metropolitan Hotel (645 Howe Street, Vancouver, British Columbia) on April 18, 2007 at 1: 30 PM (Local Time) and at any adjournment thereof.

~~VOTING~~OSI ~~RECOMMENDATIONS~~Geospatial ~~ARE~~Inc. Notes ~~INDICATED~~to BYthe ~~HIGHLIGHTED~~Consolidated ~~TEXT~~Financial ~~OVER~~Statements ~~THE~~(unaudited) Three ~~BOXES.~~and Nine Months Ended August 31, 2007 and 2006

For

Against

1. Fix Number of Directors

To fix the number of directors at seven (7).

2. Election of Directors

For

Withhold

For

Withhold

For

Withhold

01. Kenneth Kirkpatrick

02. Raymond W. Johnston

03. Helmut F. Lobmeier

04. Walter P. Purio

05. Gerald J. Shields

06. Joseph A. Stroud

07. Donald W. Young

3. Appointment of Auditor

For

Withhold

Appointment of Ernst and Young, LLP, Chartered Accountants, as Auditors of the Corporation for the ensuing year and authorizing the Directors to fix their remuneration.

For

Against

4. Amended and Restated Shareholder Rights Plan

To approve an amended and restated shareholder rights plan.

For

Against

5. Transact Other Business

To transact such other business as may properly come before the meeting.

Earnings (loss) per share

Authorized Signature(s) - This section must be completed for your instructions to be executed. Signature(s) I/We authorize you to act in accordance with my/our instructions set out above. I/We hereby revoke any proxy previously given with respect to the Meeting. If no voting instructions are indicated above, this Proxy will be voted as recommended by Management. MM/DD/YY


In thousands of U.S. dollars except share related data	For the three months ended August 31,
Earnings (loss) per share — basic and diluted	2007			2006

Net earnings (loss) for the period	$	279		$	(709	)

Less:

Class B preference share dividends		(170	)		(263	)


Net earnings (loss) available to common shareholders	$	109		$	(972	)


Weighted average number of common shares outstanding – basic and diluted		42,377,958			32,891,635


Earnings (loss) per share – basic and diluted	$	0.00		$	(0.03	)

Interim Financial Statements Annual Report Mark this box if you would like to receive interim financial statements and accompanying Management’s Discussion and Analysis by mail. o Mark this box if you would like to receive the Annual Report and accompanying Management’s Discussion and Analysis by mail. o


In thousands of U.S. dollars except share related data	For the nine months ended August 31,
Loss per share — basic and diluted	2007			2006

Net loss for the period	$	(2,076	)	$	(1,853	)

Less:

Class B preference share dividends		(552	)		(789	)



Net loss available to common shareholders	$	(2,628	)	$	(2,642	)



Weighted average number of common shares outstanding – basic and diluted		39,635,112			32,160,508


Loss per share – basic and diluted	$	(0.07	)	$	(0.08	)

If you are not mailing back your proxy, you may register online to receive the above financial report(s) by mail at www.computershare.com/mailinglist.

		The preference shares, the outstanding warrants and stock options were anti-dilutive for the purposes of calculating diluted earnings (loss) per share for the three and nine months ended August 31, 2007 and 2006.

		If all preferred shares were converted, and all warrants and options were exercised, there would be a total of 77,198,001 common shares outstanding at August 31, 2007 (November 30, 2006 – 68,834,425). As a result of the exercise of all warrants and options, the Company would receive cash of $16.2 million (November 30, 2006 — $13.4 million).

8		Commitments and Contingency

		The Company has entered into a one year guarantee for one of the Company’s subsidiaries, CHI Systems Inc. The Company has guaranteed CHI’s bank line of credit that was put in place by the previous owners prior to OSI Geospatial’s acquisition of CHI. The maximum potential amount of future payments the Company could be required to make under this guarantee is $600,000. At August 31, 2007, the carrying amount of the liability was nil.

n 0Page ~~2 2 8 1~~ 6 ~~A R 1 O S I Q +~~

OSI Geospatial, Inc. Notes to the Consolidated Financial Statements (unaudited) Three and Nine Months Ended August 31, 2007 and 2006

~~Security Class~~ In July 2002, two of the Company’s subsidiaries, Offshore Systems Ltd. and OSI Geomatics Ltd. (now Mapcon Mapping Ltd.), and four employees became subject to a lawsuit for an undisclosed amount by Triathlon Ltd., a subsidiary of MacDonald, Dettwiler and Associates Ltd., related to use of confidential information and breach of fiduciary duty. No amount has been accrued at August 31, 2007 in respect of these claims because the potential liability for the claims and the amount of damages, if any, cannot be reasonably estimated. In January 2007, the Company signed a 10 year lease for new office facilities in Burnaby, British Columbia. It relocated its North Vancouver, British Columbia operations to Burnaby, British Columbia on August 1, 2007. In April 2007, the Company signed a three year lease for new office facilities in Kanata, Ontario. It opened a corporate head office in Kanata on June 1, 2007. The company has entered into operating leases for its office premises in Canada, United States and for certain equipment. Minimum lease payments required under the remaining terms of the leases are as follows:

Holder Account Number


			Less than		1 to 3		4 to 5		After 5
Payments due by period	Total		1 year		years		years		years

In thousands of U.S. dollars
Facility leases	$	3,761	$	643	$	1,194	$	869	$	1,055
Equipment leases		79		32		38		9		—

Total contractual obligations	$	3,840	$	675	$	1,232	$	878	$	1,055

Voting Instruction Form (“VIF”) - Annual Meeting to be held on April 18, 2007

9		Income taxes

		The Company is subject to income taxes in Canada and the United States and the use of estimates is required in determining the Company’s provision for income taxes. Although the Company believes its tax estimates are reasonable, the ultimate tax determination involves significant judgement that could become subject to audit by tax authorities in the ordinary course of business. The effective rate used to record income tax expense for the three and nine months ended August 31, 2007 differed from the Canadian federal and provincial combined statutory tax rate primarily due to the change in valuation allowance to reflect those future tax benefits that were more likely than not to be realized, and items not deductible for income tax purposes. The change in effective tax rate from 2007 to 2006 was due primarily to the effect of the change in valuation allowance.

		At August 31, 2007, the Company adjusted its valuation allowance against future tax assets to reflect the amount of the future tax benefit that was more likely than not to be realized. A valuation allowance continues to be provided against those future tax assets for which there is significant uncertainty of future realization.

NON-REGISTERED (BENEFICIAL) SHAREHOLDERS


In thousands of U.S. dollars	Three months ended August 31,						Nine months ended August 31,
	2007			2006			2007			2006

Future income tax recovery	$	(10	)	$	(117	)	$	(59	)	$	(140	)
Current income tax expense (recovery)		63			(87	)		103			(65	)

Income tax expense	$	53		$	(204	)	$	44		$	(205	)

Effective tax rate		16%			22%			(2%	)		10%

1. WePage are sending to you the enclosed proxy-related materials that relate to a meeting of the holders of the series or class of securities that are held on your behalf by the intermediary identified above. Unless you attend the meeting and vote in person, your securities can be voted only by management, as proxy holder of the registered holder, in accordance with your instructions. 2. We are prohibited from voting these securities on any of the matters to be acted upon at the meeting without your specific voting instructions. In order for these securities to be voted at the meeting, it will be necessary for us to have your specific voting instructions. Please complete and return the information requested in this VIF to provide your voting instructions to us promptly. 3. If you wish to attend the meeting in person or appoint some other person or company, who need not be a shareholder, to attend and act on your behalf at the meeting, please insert your name(s) or the name of your chosen appointee in the space provided (please see reverse). 4. This VIF should be signed by you in the exact manner as your name appears on the VIF. If these voting instructions are given on behalf of a body corporate set out the full legal name of the body corporate, the name and position of the person giving voting instructions on behalf of the body corporate and the address for service of the body corporate. 5. If this VIF is not dated, it will be deemed to bear the date on which it is mailed by management to you. 6. When properly signed and delivered, securities represented by this VIF will be voted as directed by you, however, if such a direction is not made in respect of any matter, the VIF will direct the voting of the securities to be made as recommended in the documentation provided by Management for the meeting. 7. This VIF confers discretionary authority on the appointee to vote as the appointee sees fit in respect of amendments or variations to matters identified in the notice of meeting or other matters as may properly come before the meeting or any adjournment thereof. 8. Should you wish to receive a legal form of proxy, please write to Computershare at the address indicated above and one will be sent to you by mail. Please remember that a legal proxy is subject to all the terms and conditions that apply to proxies as outlined in the documentation provided by Management including any cut-off time for receipt. 9. Your voting instructions will be recorded on receipt of the VIF and a legal form of proxy will be submitted on your behalf. 10. By providing voting instructions as requested, you are acknowledging that you are the beneficial owner of, and are entitled to instruct us with respect to the voting of, these securities. 11. If you have any questions regarding the enclosed documents, please contact the Registered Representative who services your account. 12. This VIF should be read in conjunction with the accompanying documentation provided by Management.

~~VIFs~~OSI ~~submitted~~Geospatial ~~must~~Inc. Notes beto ~~received~~the byConsolidated ~~5:00~~Financial ~~pm,~~Statements ~~Eastern~~(unaudited) Three ~~Time,~~and onNine ~~April~~Months 16Ended August 31, 2007. and 2006

~~VOTE~~Segmented ~~USING~~information ~~THE~~The ~~TELEPHONE~~Company’s ORreportable ~~INTERNET~~segments 24are ~~HOURS~~as Aoutlined ~~DAY~~below. 7The ~~DAYS~~Company Adefines ~~WEEK!~~ reportable segments as components of the Company about which separate financial information is available and which is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance.

To Vote Using the Telephone To Vote Using the Internet


In thousands of U.S. dollars	Three Months Ended August 31, 2007
								Corporate
	International		U.S.					and Public
	Systems		Systems			Mapping		Company
	Operations		Operations			Operations		Costs			Total

Revenue	$	2,390	$	3,361		$	1,591	$	—		$	7,342
Gross profit		1,331		1,127			590		—			3,048
Technology Partnerships Canada		139		—			—		—			139
Interest expense		—		7			—		15			22
Income tax expense (recovery)		—		(5	)		36		23			54
Net earnings (loss)		287		578			194		(781	)		279
Equipment and furnishings expenditures		441		15			170		25			651
Intangible expenditures		5		(12	)		6		1			—
Depreciation and amortization	$	56	$	43		$	28	$	2		$	129

•	Call the number listed BELOW from a touch tone telephone.		•	Go to the following web site: www.investorvote.com
In thousands of U.S. dollars	Nine Months Ended August 31, 2007
	1-866-734-VOTE (8683) Toll Free
										Corporate
	International			U.S.						and Public
	Systems			Systems			Mapping			Company
	Operations			Operations			Operations			Costs			Total
Revenue	$	5,533		$	8,028		$	3,489		$	—		$	17,050
Gross profit		2,915			2,092			1,165						6,172
Technology Partnerships Canada		276												276
Interest expense		—			8			—			40			48
Income tax expense		—			(17	)		(25	)		86			44
Net earnings (loss)		(656	)		859			117			(2,396	)		(2,076	)
Equipment and furnishings expenditures		489			58			183			35			765
Intangible expenditures		15			(3	)		18			1			31
Depreciation and amortization	$	159		$	113		$	101		$	4		$	377

If ~~you~~Page ~~vote by telephone or the Internet, DO NOT mail back this VIF.~~8

~~Voting~~OSI byGeospatial ~~mail~~Inc. Notes ~~may~~to be the ~~only~~Consolidated ~~method~~Financial ~~for~~Statements ~~securities held in the name of a~~(unaudited) ~~corporation~~Three ~~or securities~~and ~~being~~Nine ~~voted~~Months onEnded ~~behalf~~August 31, of2007 ~~another~~and ~~individual.~~2006

Voting by mail or by Internet are the only methods by which a holder may choose an appointee other than the Management appointees named on the reverse of this VIF. Instead of mailing this VIF, you may choose one of the two voting methods outlined above to vote this VIF.


In thousands of U.S. dollars	Three Months Ended August 31, 2006
									Corporate
	International			U.S.					and Public
	Systems			Systems		Mapping			Company
	Operations			Operations		Operations			Costs			Total

Revenue	$	1,240		$	2,022	$	1,054		$	—		$	4,316
Gross profit		719			472		212			—			1,403
Technology Partnerships Canada — net		(172	)		—		—			—			(172	)
Interest expense		—			—		—			3			3
Income tax expense (recovery)		—			6		(210	)		—			(204	)
Net earnings (loss)		(91	)		25		85			(728	)		(709	)
Equipment and furnishings expenditures		(4	)		4		2			(2	)		—
Intangible expenditures		1			10		1			—			12
Depreciation and amortization	$	48		$	77	$	65		$	1		$	191

To vote by telephone or the Internet, you will need to provide your CONTROL NUMBER, HOLDER ACCOUNT NUMBER and ACCESS NUMBER listed below.


In thousands of U.S. dollars	Nine Months Ended August 31, 2006
									Corporate
	International			U.S.					and Public
	Systems			Systems		Mapping			Company
	Operations			Operations		Operations			Costs			Total

Revenue	$	4,958		$	6,244	$	2,917		$	—		$	14,119
Gross profit		3,012			1,439		741			—			5,192
Technology Partnerships Canada — net		(511	)		—		—			—			(511	)
Interest expense		—			—		—			15			15
Income tax expense (recovery)		11			12		(218	)		(10	)		(205	)
Net earnings (loss)		169			75		(35	)		(2,062	)		(1,853	)
Equipment and furnishings expenditures		42			19		24			(2	)		83
Intangible expenditures		53			23		33			—			109
Depreciation and amortization	$	145		$	230	$	201		$	4		$	580

CONTROL NUMBER HOLDER ACCOUNT NUMBER ACCESS NUMBER


In thousands of U.S. dollars	Total assets employed
							Corporate
	International		U.S.				and Public
	Systems		Systems		Mapping		Company
	Operations		Operations		Operations		Costs			Total

As at August 31, 2007	$	8,995	$	10,578	$	3,692	$	277		$	23,542


As at November 30, 2006	$	10,483	$	10,599	$	3,283	$	(20	)	$	24,345

~~14FE07058.NOBO.E.SEDAR/000001/000001/i~~ Page 9

+			+
Appointee(s)
I/We, being holder(s) of OSI Geospatial, Inc (the “Company”) hereby appoints: Kenneth Kirkpatrick, President and CEO of the Company, or failing him, John Sentjens, the Secretary of the Company,	OR	If you wish to attend in person or appoint someone else to attend on your behalf, print your name or the name of your appointee in this space (see Note #3 on reverse).

OSI Geospatial Inc.
Notes to the Consolidated Financial Statements (unaudited)
Three and Nine Months Ended August 31, 2007 and 2006

~~as my/our proxyholder with full power of substitution and to vote in accordance with the following direction (or if no directions have been given~~Geographically, asrevenues ~~the~~reported ~~proxyholder~~are ~~sees~~based ~~fit)~~on ~~and all other matters that may properly come before~~ the ~~Annual~~location ~~Meeting~~ of ~~OSI Geospatial, Inc to be held at~~ the ~~Metropolitan~~Company’s ~~Hotel~~customers ~~(645~~as ~~Howe Street, Vancouver, British Columbia) on April 18, 2007 at 1~~follows:~~30 PM (Local Time) and at any adjournment thereof.~~

VOTING RECOMMENDATIONS ARE INDICATED BY HIGHLIGHTED TEXT OVER THE BOXES.


In thousands of U.S. dollars	Three months ended August 31,				Nine months ended August 31,
	2007		2006		2007		2006
Europe	$	1,166	$	651	$	3,297	$	1,084
Australia/New Zealand		1,121		149		1,556		933
United States		4,235		3,304		9,773		10,006
Canada		820		212		2,424		2,096

Total	$	7,342	$	4,316	$	17,050	$	14,119

For

Against

1. Fix Number of Directors

To fix the number of directors at seven (7).

2. Election of Directors

For

Withhold

For

Withhold

For

Withhold

01. Kenneth Kirkpatrick

02. Raymond W. Johnston

03. Helmut F. Lobmeier

04. Walter P. Purio

05. Gerald J. Shields

06. Joseph A. Stroud

07. Donald W. Young

3. Appointment of Auditor

For

Withhold

Appointment of Ernst and Young, LLP, Chartered Accountants, as Auditors of the Corporation for the ensuing year and authorizing the Directors to fix their remuneration.

For

Against

4. Amended and Restated Shareholder Rights Plan

To approve an amended and restated shareholder rights plan.

For

Against

5. Transact Other Business

To transact such other business as may properly come before the meeting.

Geographically, equipment and furnishings, and intangible and other assets are reported based on location. At August 31, 2007 and November 30, 2006, all of the Company’s equipment and furnishings, and intangible and other assets were located in Canada and the U.S. as follows:

Authorized Signature(s) - This section must be completed for your instructions to be executed. Signature(s) If you are voting on behalf of a corporation or another individual you may be required to provide documentation evidencing your power to sign this VIF with signing capacity stated. MM/DD/YY


In thousands of U.S. dollars	August 31, 2007
	Canada		U.S.		Total
Equipment and furnishings	$	1,406	$	284	$	1,690
Intangible and other assets		463		235		698
Goodwill				8,330		8,330

Total	$	1,869	$	8,849	$	10,718

Interim Financial Statements			Annual Report
In thousands of U.S. dollars	November 30, 2006
Mark this box if you would like to receive interim financial statements and accompanying Management’s Discussion and Analysis by mail.	o		Mark this box if you would like to receive the Annual Report and accompanying Management’s Discussion and Analysis by mail.	o	Should you wish to receive a legal proxy, refer to Note #8 on reverse.
	Canada				U.S.		Total
Equipment and furnishings	$	859			$	230	$	1,089
Intangible and other assets		322				472		794
Goodwill		—				8,129		8,129
Total	$	1,181			$	8,831	$	10,012

If ~~you~~Page ~~are not mailing back your VIF, you may register online to receive the~~10 ~~above financial report(s) by mail at www.computershare.com/mailinglist.~~

nForm 52-109F2 0— 2Certification 2of 8Interim ~~1 5 A R 1 O S I Q +~~Filings

I, Ken Kirkpatrick, President and Chief Executive Officer, OSI Geospatial Inc., certify that:

1. I have reviewed the interim filings (as this term is defined in Multilateral Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings) of OSI Geospatial Inc., (the “issuer”) for the interim period ended August 31, 2007;

2. Based on my knowledge, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings;

3. Based on my knowledge, the interim financial statements together with the other financial information included in the interim filings fairly present in all material respects the financial condition, results of operations and cash flows of the issuer, as of the date and for the periods presented in the interim filings; and

4. The issuer’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures and internal control over financial reporting for the issuer, and we have:

(a) designed such disclosure controls and procedures, or caused them to be designed under our supervision, to provide reasonable assurance that material information relating to the issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which the interim filings are being prepared;

(b) designed such internal control over financial reporting, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer’s GAAP; and

(c) caused the issuer to disclose in the interim MD&A any change in the issuer’s internal control over financial reporting that occurred during the nine months ended August 31,2007 that has materially affected, or is reasonably likely to materially affect, the issuer’s internal control over financial reporting.

Date: October 15, 2007


/s/ Ken Kirkpatrick Ken Kirkpatrick President and Chief Executive Officer

Form 52-109F2 — Certification of Interim Filings

I, John T. Sentjens, Vice President Finance, OSI Geospatial Inc., certify that:

(c) caused the issuer to disclose in the interim MD&A any change in the issuer’s internal control over financial reporting that occurred during the nine months ended August 31, 2007 that has materially affected, or is reasonably likely to materially affect, the issuer’s internal control over financial reporting.

Date: October 15, 2007


/s/ John Sentjens John T. Sentjens Vice President Finance

OSI Geospatial Inc.

Interim Consolidated Financial Statements (Unaudited)
Three months ended February 28, 2007 and 2006
(expressed in U.S. dollars)

(Prepared in accordance with Canadian Generally Accepted Accounting Principles)

OSI Geospatial Inc.

(Incorporated under the laws of the Province of British Columbia, Canada)

Consolidated Balance Sheets (unaudited)


	February 28,			November 30,
In thousands of U.S. dollars	2007			2006

Assets

Current assets
Accounts receivable (note 5)	$	7,887		$	12,707
Income taxes recoverable		94			28
Inventory (note 6)		1,295			1,063
Prepaid expenses and deposits		974			535


		10,250			14,333

Future income tax asset		10			—

Plant and equipment		1,025			1,089
Intangible and other assets		714			794
Goodwill		8,129			8,129


	$	20,128		$	24,345


Liabilities

Current liabilities
Bank indebtedness	$	378		$	904
Accounts payable and accrued liabilities		3,519			4,887
Income taxes payable		—			86
Unearned revenue		524			667


		4,421			6,544

Future income tax liability		—			20


		4,421			6,564


Contingency (note 8)

Shareholders’ Equity

Issued and outstanding
30,262 Class A Series A preference shares (2006 – 30,262) (note 7a)		19			19
224,570 Class B, Series 2 preference shares (2006 – 279,840)		5,711			7,115
38,388,221 common shares (2006 – 35,137,046) (note 7b)		17,291			15,887


		23,021			23,021

Warrants		4,286			4,286

Contributed surplus		1,396			11,343

Accumulated deficit		(15,285	)		(13,296	)

Accumulated other comprehensive income		2,289			2,427


		15,707			17,781


	$	20,128		$	24,345

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

OSI Geospatial Inc.

Consolidated Statements of Operations (unaudited)


	Three months ended February 28,
In thousands of U.S. dollars, except share related data	2007			2006

Revenue
Marine systems	$	700		$	1,282
Land and air systems		2,348			1,852
Mapping		523			529


		3,571			3,663

Cost of sales		2,902			2,469


Gross profit		669			1,194


Expenses
General and administrative		1,322			1,346
Engineering		481			542
Sales and marketing		705			552
Depreciation and amortization		111			132
Interest expense		22			6
Interest income		—			(13	)
Foreign exchange loss (gain)		(85	)		21
Technology Partnerships Canada royalty		30			57
Technology Partnerships Canada contribution		—			(210	)


		2,586			2,433


Net loss before income taxes		(1,917	)		(1,239	)


Future income tax expense (recovery)		(30	)		16-
Current income tax expense (recovery)		102			(26	)


Income tax expense (recovery) (note 9)		72			(10	)


Net loss	$	(1,989	)	$	(1,229	)


Net loss attributable to common shareholders (note 7d)	$	(1,989	)	$	(1,229	)


Loss per share (note 7d) — basic and diluted	$	(0.06	)	$	(0.04	)

Weighted average number of common shares outstanding (note 7d) – basic and diluted		36,148,418			31,269,155

Dividends declared per share
Class B preference shares – Series 2	$	—		$	—

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

OSI Geospatial Inc.
Consolidated Statements of Shareholders’ Equity and Accumulated Deficit (unaudited)


In thousands of U.S. dollars except share numbers	Three months ended February 28, 2007
	Units
Class A preference shares
Balance at November 30, 2006		30,262		$	19

Balance at February 28, 2007		30,262		$	19


Class B preference shares
Balance at November 30, 2006		279,840		$	7,115
Class B preference shares converted to common shares		(55,720	)		(1,404	)

Balance at February 28, 2007		224,120		$	5,711


Common shares
Balance at November 30, 2006		35,137,046		$	15,887
Class B preference shares converted to common shares		3,251,175			1,404

Balance at February 28, 2007		38,388,221		$	17,291


Warrants
Balance at November 30, 2006		13,788,368		$	4,286

Balance at February 28, 2007		13,788,368		$	4,286


Contributed surplus
Balance at November 30, 2006				$	1,343
Stock-based compensation					53

Balance at February 28, 2007				$	1,396


Accumulated deficit
Balance at November 30, 2006				$	(13,296	)
Net loss for the quarter					(1,989	)

Balance at February 28, 2007				$	(15,285	)


Accumulated other comprehensive income
Foreign currency translation adjustment
Balance at November 30, 2006				$	2,427
Adjustment for the quarter					(138	)

Balance at February 28, 2007				$	2,289


Total shareholders’ equity				$	15,707

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

OSI Geospatial Inc.
Consolidated Statements of Cash Flows (unaudited)


	For the three months ended February 28,
In thousands of U.S. dollars	2007			2006

Cash flows from operating activities
Net loss for the period	$	(1,989	)	$	(1,229	)
Items not affecting cash
Depreciation and amortization		164			187
Stock-based compensation		53			25
Future income taxes		(30	)		(10	)


		(1,802	)		(1,027	)


Changes in non-cash working capital items
Accounts receivable		4,597			3,637
Inventory		(258	)		(94	)
Prepaid expenses and deposits		(423	)		60
Accounts payable and accrued liabilities		(1,294	)		(1,779	)
Income taxes payable		(176	)		(141	)
Unearned revenue		(127	)		252


		2,319			1,935


		517			908


Cash flows used in investing activities
Purchase of CHI Systems Inc., net of cash acquired		—			(7,883	)
Increase in marketable securities		—			(258	)
Decrease in restricted cash		—			190
Additions to plant and equipment		(27	)		(48	)
Additions to intangibles and other assets		(22	)		(40	)


		(49	)		(8,039	)


Cash flows used in financing activities
Repayment to operating line of credit		(477	)		—


		(477	)		—


Effect of foreign exchange on cash and cash equivalents		9			58


Decrease in cash and cash equivalents		—			(7,073	)

Cash and cash equivalents – beginning of period		—			8,222


Cash and cash equivalents – end of period	$	—		$	1,149

1 Basis of presentation

These unaudited consolidated financial statements have been prepared by management and include the accounts of OSI Geospatial Inc. and its subsidiaries, collectively referred to as the Company. These unaudited interim consolidated financial statements have been prepared in accordance with generally accepted accounting principles in Canada (“Canadian GAAP”) and all amounts have been expressed in thousands of U.S. dollars unless otherwise noted.

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

OSI Geospatial Inc.
Notes to the Consolidated Financial Statements (unaudited)
Three Months Ended February 28, 2007 and 2006

The annual and interim consolidated financial statements originally issued for February 28, 2007 and prior periods were prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”). These previously released financial statements included a reconciliation to Canadian GAAP. The Company has restated all comparative amounts presented in accordance with Canadian GAAP.

These unaudited interim consolidated financial statements do not include all the information and footnote disclosures required by Canadian GAAP for annual financial statements. These unaudited interim consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto.

On April 12, 2006 at the Company’s annual general meeting its shareholders voted in favor of changing the Company’s name from Offshore Systems International Ltd. to OSI Geospatial Inc. The name change was effective June 5, 2006. For the purposes of this report, the Company is referred to by its new legal identity.

The preparation of these unaudited interim consolidated financial statements requires management to make estimates and assumptions that affect the amounts reported. Actual results could vary from these estimates and the operating results for the interim period presented are not necessarily indicative of the results expected for the full year.

2 Nature of operations

OSI Geospatial Inc. designs, develops, and markets software and systems for enhancing situational awareness in command, control, and intelligence applications. OSI Geospatial’s principal product is the proprietary ECPINS^® line of electronic chart navigation systems for commercial and military customers. OSI Geospatial conducts its operations through three business units – International Systems Operations, U.S. Systems Operations and Mapping Operations. The Company’s International and U.S. Systems business units develop and produce geographic information display systems and software for the marine navigation, and command and control markets, and situational awareness products for land-based and aeronautical command and control markets. The Company’s Mapping business unit provides digital land map and electronic nautical chart production services, and produces and distributes electronic nautical chart data.

3 Accounting changes

a) Changes in accounting policies

In line with the conversion to Canadian GAAP referred to in Note 1 above, the Company has adopted the provisions of CICA Handbook Section 3855 Financial Instruments – Recognition and Measurement, CICA Handbook Section 3861 Financial Instruments – Presentation and Disclosure, CICA Handbook Section 3865 Hedges and CICA Handbook Section 1530 Comprehensive Income. These provisions became effective for the fiscal year beginning December 1, 2006.

(i) Financial Instruments – Recognition and Measurement

This standard prescribes the recognition and measurement of financial instruments. Section 3855 requires that all financial assets and liabilities (including derivatives) be measured at fair value on initial recognition except for certain related party transactions. Measurement in subsequent periods depends on the classification of the instruments. All financial instruments must be classified as one of the following categories: held for trading, held to maturity, loans and receivables, available for sale assets and other financial liabilities.

The financial assets categorized as held for trading are measured at fair value with unrealized gains and losses recognized in net income. Section 3855 permits an entity to designate any financial instruments as held for trading on initial recognition or adoption of this standard, even if that instrument would not otherwise meet the definition of held for trading as specified in Section 3855. The Company’s financial instruments classified as held for trading have included forward contracts and marketable securities,

Page 2

OSI Geospatial Inc.
Notes to the Consolidated Financial Statements (unaudited)
Three Months Ended February 28, 2007 and 2006

when used. The Company has historically measured these instruments at fair value and any unrealized gains and losses have been included in income.

Available for sale financial assets are measured at fair value with unrealized gains and losses recognized in other comprehensive income. The Company currently has no assets classified as available for sale.

The financial assets classified as loans and receivables and held to maturity are measured at amortized cost. There is no change in accounting treatment for these financial instruments as a result of adoption of Section 3855.

(ii) Financial Instruments – Presentation and Disclosure

CICA Handbook Section 3861 establishes standards for presentation of financial instruments and non-financial derivatives, and identifies the information that should be disclosed about them. Effective December 1, 2007, the Company will be required to adopt two new CICA standards: Section 3862 Financial Instruments – Disclosures; and Section 3863 Financial Instruments – Presentation, which will replace Section 3861 Financial Instruments – Disclosure and Presentation. The new disclosure standard increases the emphasis on the risks associated with both recognized and unrecognized financial instruments and how those risks are managed. The new presentation standard carries forward the former presentation requirements. The new financial instruments presentation and disclosure requirements were issued in December 2006 and the Company is assessing the impact on its consolidated financial statements.

(iii) Hedges

This standard sets out the criteria of when hedge accounting is applied and how it is applied. It provides the option of designating qualifying transactions as hedges for accounting purposes. The qualifying hedging relationships include fair value hedges, cash flow hedges, and hedges of foreign currency exposures of net investments in self-sustaining foreign operations. The changes in the fair value of the hedging derivatives will be recognized in net earnings or other comprehensive income depending on the nature of the hedging relationships. Any gains and losses resulting from any ineffectiveness in hedging relationships are recognized in net income immediately. The Company does not currently have any hedges and as a result there is no change on adoption of Section 3865.

(iv) Comprehensive Income

This section establishes standards for the reporting and disclosure of other comprehensive income [“OCI”] in a new category, Accumulated Comprehensive Income, which will be added to shareholders’ equity on the consolidated balance sheet. Comprehensive income includes all changes in equity of the Company during a period except those resulting from investments by shareholders and distributions to shareholders. The major components included in Accumulated Comprehensive Income are unrealized gains and losses on financial assets classified as available for sale, and unrealized foreign exchange gains and losses arising on translation of the financial statements of self-sustaining foreign operations.

As a result of previously preparing the Company’s financial statements in accordance with U.S. GAAP, the adoption of Section 1530 alongside the conversion to Canadian GAAP has not resulted in any change in disclosure on the Company’s balance sheet.

b) Change in reporting currency

Effective March 1, 2006, the Company adopted the U.S. dollar as its reporting currency. In general this change results from an increase in the overall proportion of business activities conducted in U.S. dollars. The change was effected by translating assets and liabilities at the existing U.S./Canadian dollar foreign exchange spot rate on the last day of the month, while earnings were translated at the average rate for each month. Equity transactions have been translated at historical rates; with opening equity restated at the rate of

Page 3

OSI Geospatial Inc.
Notes to the Consolidated Financial Statements (unaudited)
Three Months Ended February 28, 2007 and 2006

exchange on December 1, 2001. The resulting net translation adjustment has been credited to the foreign currency translation adjustment.

Prior to March 1, 2006, the reporting currency of the Company was Canadian dollars.

4 Acquisition

CHI Systems Inc.

On December 14, 2005, the Company acquired CHI Systems Inc. (“CHI Systems”), a United States defense contracting company. CHI Systems has multiple offices in the United States and is a supplier of technology and services to the U.S. Department of Defense and key defense prime contractors. Under the terms of the agreement, the Company paid approximately $9.0 million for 100% of the outstanding shares of CHI Systems, of which $8.1 million was paid in cash with the balance paid by the issuance of 1,067,975 common shares of the Company. Information regarding this acquisition can be found in the company’s audited consolidated financial statements for the year ended November 30, 2006 as reported in our 2006 Annual Report filed on SEDAR at www.sedar.com or our annual Form 20-F which will be reported on EDGAR at www.sec.gov. The results of CHI Systems’ operations have been included in the consolidated financial statements commencing December 14, 2005.

5 Accounts receivable


In thousands of U.S. dollars
	February 28,			November 30,
	2007			2006

Trade	$	3,112		$	5,143
Unbilled revenue		4,681			7,257
Technology Partnerships Canada contribution		93			269
Other		58			97
Allowance for doubtful accounts		(57	)		(59	)


	$	7,887		$	12,707

6 Inventory


In thousands of U.S. dollars
	February 28,		November 30,
	2007		2006

Materials and components	$	810	$	958
Finished goods		485		105


	$	1,295	$	1,063

7 Capital Stock

a) Class A preference shares

The Company has 30,262 (November 30, 2006 – 30,262) Class A preference shares outstanding that have a value of $19,000 (November 30, 2006 — $19,000) for financial statement purposes. These Class A preference shares are being held in escrow but are no longer subject to any escrow restrictions and may be converted at any time into common shares of the Company, by notice in writing from the holders.

Page 4

OSI Geospatial Inc.
Notes to the Consolidated Financial Statements (unaudited)
Three Months Ended February 28, 2007 and 2006

b) Issued and outstanding common shares

During the three months ended February 28, 2007, 55,720 Preference shares were converted into 3,251,175 common shares. The Preference shares were reduced, and the common shares were increased, by $1.4 million, the carrying value of the shares converted.

c) Stock option plans

A summary of the status of the Company’s stock option plans at February 28, 2007 is as follows:


In U.S. dollars
				Weighted
	Number of			Average
	shares			exercise price
Outstanding — beginning of period		3,417,584		$	0.83
Granted		170,000			0.61
Forfeited		(5,000	)		0.75
Expired		(176,668	)		0.87


Outstanding — end of period		3,405,916		$	0.80


Exercisable – end of period		3,405,916		$	0.80

Stock-based compensation

For the three months ended February 28, 2007 the Company incurred non-cash stock-based compensation expense of $53,000 (three months ended February 28, 2006 — $25,000) related to stock options granted, all of which vested immediately. The expense was included in general and administrative costs and was recorded in contributed surplus.

The fair value of stock options was estimated using the Black-Scholes option pricing model using the following weighted average assumptions by grant year:


	2007			2006

Risk-free interest rate		4.02	%		2.98	%
Volatility		54	%		54	%
Estimated average option lives	5 years			5 years
Dividend yield		0.0	%		0.0	%

d) Loss per share


In thousands of U.S. dollars except share related data	For the three months ended February 28,
Loss per share – basic and diluted	2007			2006

Net loss for the period	$	(1,989	)	$	(1,229	)


Net loss available to common shareholders	$	(1,989	)	$	(1,229	)


Weighted average number of common shares outstanding – basic and diluted		36,148,418			31,269,155


Loss per share – basic and diluted	$	(0.06	)	$	(0.04	)

Page 5

OSI Geospatial Inc.
Notes to the Consolidated Financial Statements (unaudited)
Three Months Ended February 28, 2007 and 2006

If all preferred shares were converted, and all warrants and options were exercised, there would be a total of 68,822,757 common shares outstanding at February 28, 2007 (November 30, 2006 – 68,834,425). As a result of the exercise of all warrants and options, the company would receive cash of $13.2 million (November 30, 2006 — $13.4 million).

8 Contingency

In July 2002, two of the Company’s subsidiaries, Offshore Systems Ltd. and OSI Geomatics Ltd. (now Mapcon Mapping Ltd.), and four employees became subject to a lawsuit for an undisclosed amount by Triathlon Ltd., a subsidiary of MacDonald, Dettwiler and Associates Ltd., related to use of confidential information and breach of fiduciary duty. No amount has been accrued at February 28, 2007 in respect of these claims because the potential liability for the claims and the amount of damages, if any, cannot be reasonably estimated.

9 Income taxes

The Company is subject to income taxes in Canada and the United States and the use of estimates is required in determining the Company’s provision for income taxes. Although the Company believes its tax estimates are reasonable, the ultimate tax determination involves significant judgement that could become subject to audit by tax authorities in the ordinary course of business. The effective rate used to record income tax expense for the three months ended February 28, 2007 differed from the Canadian federal and provincial combined statutory tax rate primarily due to the change in valuation allowance to reflect those future tax benefits that were more likely than not to be realized, and items not deductible for income tax purposes. The change in effective tax rate from 2007 to 2006 was due primarily to the effect of the change in valuation allowance.

At February 28, 2007, the Company adjusted its valuation allowance against future income tax assets to reflect the amount of the future tax benefit that was more likely than not to be realized. A valuation allowance continues to be provided against those future income tax assets for which there is uncertainty of future realization.

Page 6

OSI Geospatial Inc.
Notes to the Consolidated Financial Statements (unaudited)
Three Months Ended February 28, 2007 and 2006


In thousands of U.S. dollars	Three months ended February 28,
	2007			2006
Future income tax expense (recovery)	$	(30	)	$	16
Current income tax expense (recovery)		102			(26	)

Income tax expense (recovery)	$	72		$	(10	)


Effective tax rate		(4%	)		1%

10 Segmented information

The Company’s reportable segments are as outlined below. The Company defines reportable segments as components of the Company about which separate financial information is available and which is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance.


In thousands of U.S. dollars						Three Months Ended February 28, 2007
									Corporate
	International			U.S.					and Public
	Systems			Systems		Mapping			Company
	Operations			Operations		Operations			Costs			Total

Revenue	$	700		$	2,348	$	523		$	—		$	3,571
Gross profit		37			520		112			—			669
Technology Partnerships Canada		30			—		—			—			30
Interest expense		—			—		—			22			22
Income tax expense		—			54		(12	)		32			72
Net earnings (loss)		(1,156	)		79		(208	)		(704	)		(1,989	)
Plant and equipment expenditures		14			6		7			—			27
Intangible expenditures		10			7		5			—			22
Depreciation and amortization	$	50		$	77	$	36		$	1		$	164


In thousands of U.S. dollars							Three Months Ended February 28, 2006
										Corporate
	International			U.S.						and Public
	Systems			Systems			Mapping			Company
	Operations			Operations			Operations			Costs			Total

Revenue	$	1,282		$	1,851		$	529		$	—		$	3,663
Gross profit		679			423			92			—			1,194
Technology Partnerships Canada — net		(153	)		—			—			—			(153	)
Interest expense		—			—			—			6			6
Income tax expense (recovery)		—			(3	)		(7	)		—			(10	)
Net earnings (loss)		(392	)		—			(241	)		(596	)		(1,229	)
Plant and equipment expenditures		18			5			25			—			48
Intangible expenditures		33			—			7			—			40
Depreciation and amortization	$	46		$	73		$	67		$	1		$	187

Page 7

OSI Geospatial Inc.
Notes to the Consolidated Financial Statements (unaudited)
Three Months Ended February 28, 2007 and 2006


In thousands of U.S. dollars
	International		U.S.				Corporate and Public
	Systems		Systems		Mapping		Company
Total assets employed	Operations		Operations		Operations		Costs			Total

As at February 28, 2007	$	6,745	$	10,611	$	2,677	$	95		$	20,128


As at November 30, 2006	$	10,483	$	10,599	$	3,283	$	(20	)	$	24,345

Geographically, revenues reported are based on the location of the Company’s customers as follows:


In thousands of U.S. dollars	For the three months ended February 28,
	2007		2006

Europe	$	353	$	173
Australia/New Zealand		156		387
United States		2,578		2,285
Canada		484		818

Total	$	3,571	$	3,663

Geographically, plant and equipment and intangible and other assets are reported based on location. At February 28, 2007 and November 30, 2006, all of the Company’s plant and equipment and intangible and other assets were located in Canada and the U.S. as follows:


In thousands of U.S. dollars			February 28, 2007
	Canada		U.S.		Total
Plant and equipment	$	810	$	215	$	1,025
Intangible and other assets		301		413		714
Goodwill		—		8,129		8,129

Total	$	1,111	$	8,757	$	9,868


In thousands of U.S. dollars			November 30, 2006
	Canada		U.S.		Total
Plant and equipment	$	859	$	230	$	1,089
Intangible and other assets		322		472		794
Goodwill		—		8,129		8,129

Total	$	1,181	$	8,831	$	10,012

Page 8

OSI Geospatial Inc.

Interim Consolidated Financial Statements (Unaudited)
Three and Six Months ended May 31, 2007 and 2006
(expressed in U.S. dollars)

(Prepared in accordance with Canadian Generally Accepted Accounting Principles)

OSI Geospatial Inc.
(Incorporated under the laws of the Province of British Columbia, Canada)
Consolidated Balance Sheets (unaudited)


In thousands of U.S. dollars	May 31, 2007			November 30, 2006
Assets

Current assets
Accounts receivable (note 5)	$	7,701		$	12,707
Income taxes recoverable		130			28
Inventory (note 6)		1,414			1,063
Prepaid expenses and deposits		647			535


		9,892			14,333

Future income tax asset		29			—

Equipment and furnishings		1,109			1,089
Intangible and other assets		748			794
Goodwill		8,330			8,129


	$	20,108		$	24,345

Liabilities

Current liabilities
Bank indebtedness	$	544		$	904
Accounts payable and accrued liabilities		3,223			4,887
Dividend payable		382			—
Income taxes payable		—			86
Unearned revenue		506			667


		4,655			6,544
Future income tax liability		—			20


		4,655			6,564

Commitments and contingency (note 8)

Shareholders’ Equity

Issued and outstanding
30,262 Class A Series A preference shares (November 30, 2006 – 30,262) (note 7a)		19			19
200,770 Class B, Series 2 preference shares (November 30, 2006 – 279,840) (note 7b)		5,107			7,115
40,088,221 common shares (November 30, 2006 – 35,137,046) (note 7b)		18,054			15,887


		23,180			23,021

Warrants		4,286			4,286

Contributed surplus		1,483			1,343

Accumulated deficit		(16,085	)		(13,296	)

Accumulated other comprehensive income		2,589			2,427

		15,453			17,781

	$	20,108		$	24,345

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

OSI Geospatial Inc.
Consolidated Statements of Operations (unaudited)


	Three months ended May 31,						Six months ended May 31,
In thousands of U.S. dollars, except share related data	2007			2006			2007			2006

Revenue
Marine systems	$	2,504		$	2,436		$	3,204		$	3,718
Land and air systems		2,259			2,370			4,607			4,221
Mapping		1,375			1,334			1,898			1,863


		6,138			6,140			9,709			9,802

Cost of sales		3,683			3,545			6,585			6,014


Gross profit		2,455			2,595			3,124			3,788


Expenses
General and administrative		1,476			1,514			2,798			2,860
Engineering		389			450			870			993
Sales and marketing		791			606			1,496			1,158
Depreciation and amortization		34			138			145			270
Interest expense		5			6			27			12
Interest income		(8	)		(7	)		(8	)		(20	)
Foreign exchange loss (gain)		107			(21	)		22			—
Technology Partnerships Canada royalty		107			108			137			165
Technology Partnerships Canada contribution		—			(293	)		—			(504	)


		2,901			2,501			5,487			4,934


Net earnings (loss) before income taxes		(446	)		94			(2,363	)		(1,146	)


Future income tax expense (recovery)		(19	)		(39	)		(50	)		(23	)
Current income tax expense (recovery)		(61	)		46			42			20


Income tax expense (recovery) (note 9)		(80	)		7			(8	)		(3	)


Net earnings (loss)	$	(366	)	$	87		$	(2,355	)	$	(1,143	)


Net loss available to common shareholders (note 7d)	$	(748	)	$	(439	)		(2,737	)	$	(1,669	)


Loss per share (note 7d) — basic and diluted	$	(0.02	)	$	(0.01	)	$	(0.07	)	$	(0.05	)

Weighted average number of common shares outstanding (note 7d) – basic and diluted		39,251,264			32,301,357		$	38,248,619			31,790,928

Dividends declared per share
Class B preference shares – Series 2	$	1.64		$	1.59		$	1.64		$	1.59

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

OSI Geospatial Inc.
Consolidated Statements of Shareholders’ Equity and Accumulated Deficit (unaudited)
For the six months ended May 31, 2007


In thousands of U.S. dollars except share numbers
	Units

Class A preference shares
Balance at November 30, 2006		30,262		$	19

Balance at May 31, 2007		30,262		$	19


Class B preference shares
Balance at November 30, 2006		279,840		$	7,115
Class B preference shares converted to common shares		(79,070	)		(2,008	)

Balance at May 31, 2007		200,770		$	5,107


Common shares
Balance at November 30, 2006		35,137,046		$	15,887
Class B preference shares converted to common shares		4,651,175			2,008
Shares issued		300,000			159

Balance at May 31, 2007		40,088,221		$	18,054


Warrants
Balance at November 30, 2006		13,788,368		$	4,286

Balance at May 31, 2007		13,788,368		$	4,286


Contributed surplus
Balance at November 30, 2006				$	1,343
Stock-based compensation					140

Balance at May 31, 2007				$	1,483


Accumulated deficit
Balance at November 30, 2006				$	(13,296	)
Dividends on Class B preference shares					(382	)
Tax expense on dividends					(52	)
Net loss for the period					(2,355	)

Balance at May 31, 2007				$	(16,085	)


Accumulated other comprehensive income
Foreign currency translation adjustment Balance at November 30, 2006				$	2,427
Adjustment for the period					162

Balance at May 31, 2007				$	2,589


Total shareholders’ equity				$	15,453

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

OSI Geospatial Inc.
Consolidated Statements of Cash Flows (unaudited)
Three and Six Months Ended May 31, 2007 and 2006


	Three Months ended May 31,						Six months ended May 31,
In thousands of U.S. dollars	2007			2006			2007			2006

Cash flows from operating activities
Net loss for the period	$	(366	)	$	87		$	(2,355	)	$	(1,143	)
Items not affecting cash
Depreciation and amortization		84			201			248			389
Stock-based compensation		87			79			139			104
Future income taxes		(33	)		(14	)		(46	)		(24	)


		(228	)		353			(2,014	)		(674	)

Changes in non-cash working capital items
Accounts receivable		551			(2	)		5,148			3,636
Inventory		7			(16	)		(251	)		(110	)
Prepaid expenses and deposits		383			33			(39	)		92
Accounts payable and accrued liabilities		(464	)		631			(1,748	)		(1,148	)
Dividends payable		382			—			382			—
Income taxes payable		(74	)		(104	)		(277	)		(244	)
Unearned revenue		(146	)		126			(273	)		378


		639			668			2,942			2,604


		411			1,021			928			1,930

Cash flows used in investing activities
Purchase of CHI Systems Inc., net of cash acquired (note 4b)		—			(240	)		—			(8,123	)
Purchase of Liddy International Inc. (note 4a)		(25	)		—			(25	)		—
Decrease (increase) in marketable securities		—			99			—			(160	)
Decrease in restricted cash		—			(60	)		—			130
Additions to equipment and furnishings		(57	)		(39	)		(84	)		(87	)
Additions to intangibles and other assets		(39	)		(53	)		(61	)		(93	)


		(121	)		(293	)		(170	)		(8,333	)


Cash flows used in financing activities
Advances from (payments to) operating line of credit		121			—			(356	)		—
Issue of common shares		—			6			—			6
Class B preference share dividends		(382	)		(526	)		(382	)		(526	)


		(261	)		(520	)		(738	)		(520	)


Effect of foreign exchange on cash and cash equivalents		(29	)		62			(20	)		120


Increase (decrease) in cash and cash equivalents		—			270			—			(6,803	)

Cash and cash equivalents – beginning of period		—			1,149			—			8,222


Cash and cash equivalents – end of period	$	—		$	1,419		$	—		$	1,419

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

OSI Geospatial Inc.
Notes to the Consolidated Financial Statements (unaudited)
Three and Six Months Ended May 31, 2007 and 2006

1		Basis of presentation

		These unaudited consolidated financial statements have been prepared by management and include the accounts of OSI Geospatial Inc. and its subsidiaries, collectively referred to as the Company. These unaudited interim consolidated financial statements have been prepared in accordance with generally accepted accounting principles in Canada (“Canadian GAAP”) and all amounts have been expressed in thousands of U.S. dollars unless otherwise noted.

		The annual and interim consolidated financial statements originally issued for May 31, 2007 and prior periods were prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”). These previously released financial statements included a reconciliation to Canadian GAAP. The Company has restated all comparative amounts presented in accordance with Canadian GAAP.

		These unaudited interim consolidated financial statements do not include all the information and footnote disclosures required by Canadian GAAP for annual financial statements. These unaudited interim consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto.

		On April 12, 2006 at the Company’s annual general meeting its shareholders voted in favor of changing the Company’s name from Offshore Systems International Ltd. to OSI Geospatial Inc. The name change was effective June 5, 2006. For the purposes of this report, the Company is referred to by its new legal identity.

		The preparation of these unaudited interim consolidated financial statements requires management to make estimates and assumptions that affect the amounts reported. Actual results could vary from these estimates and the operating results for the interim period presented are not necessarily indicative of the results expected for the full year.

2		Nature of operations

		OSI Geospatial Inc. designs, develops, and markets software and systems for enhancing situational awareness in command, control, and intelligence applications. OSI Geospatial’s principal product is the proprietary ECPINS^® line of electronic chart navigation systems for commercial and military customers. OSI Geospatial conducts its operations through three business units – International Systems Operations, U.S. Systems Operations and Mapping Operations. The Company’s International and U.S. Systems business units develop and produce geographic information display systems and software for the marine navigation, and command and control markets, and situational awareness products for land-based and aeronautical command and control markets. The Company’s Mapping business unit provides digital land map and electronic nautical chart production services, and produces and distributes electronic nautical chart data.

3		Accounting changes

Changes in accounting policies

	(i)		Financial Instruments – Recognition and Measurement

			This standard prescribes the recognition and measurement of financial instruments. Section 3855 requires that all financial assets and liabilities (including derivatives) be measured at fair value on initial

Page 1

OSI Geospatial Inc.
Notes to the Consolidated Financial Statements (unaudited)
Three and Six Months Ended May 31, 2007 and 2006

recognition except for certain related party transactions. Measurement in subsequent periods depends on the classification of the instruments. All financial instruments must be classified as one of the following categories: held for trading, held to maturity, loans and receivables, available for sale assets and other financial liabilities.

			The financial assets categorized as held for trading are measured at fair value with unrealized gains and losses recognized in net income. Section 3855 permits an entity to designate any financial instruments as held for trading on initial recognition or adoption of this standard, even if that instrument would not otherwise meet the definition of held for trading as specified in Section 3855. The Company’s financial instruments classified as held for trading have included forward contracts and marketable securities, when used. The Company has historically measured these instruments at fair value and any unrealized gains and losses have been included in income.

			Available for sale financial assets are measured at fair value with unrealized gains and losses recognized in other comprehensive income. The Company currently has no assets classified as available for sale.

			The financial assets classified as loans and receivables and held to maturity are measured at amortized cost. There is no change in accounting treatment for these financial instruments as a result of adoption of Section 3855.

	(ii)		Financial Instruments – Presentation and Disclosure

			CICA Handbook Section 3861 establishes standards for presentation of financial instruments and non-financial derivatives, and identifies the information that should be disclosed about them. Effective December 1, 2007, the Company will be required to adopt two new CICA standards: Section 3862 Financial Instruments – Disclosures; and Section 3863 Financial Instruments – Presentation, which will replace Section 3861 Financial Instruments – Disclosure and Presentation. The new disclosure standard increases the emphasis on the risks associated with both recognized and unrecognized financial instruments and how those risks are managed. The new presentation standard carries forward the former presentation requirements. The new financial instruments presentation and disclosure requirements were issued in December 2006 and the Company is assessing the impact on its consolidated financial statements.

	(iii)		Hedges

			This standard sets out the criteria of when hedge accounting is applied and how it is applied. It provides the option of designating qualifying transactions as hedges for accounting purposes. The qualifying hedging relationships include fair value hedges, cash flow hedges, and hedges of foreign currency exposures of net investments in self-sustaining foreign operations. The changes in the fair value of the hedging derivatives will be recognized in net earnings or other comprehensive income depending on the nature of the hedging relationships. Any gains and losses resulting from any ineffectiveness in hedging relationships are recognized in net income immediately. The Company does not currently have any hedges and as a result there is no change on adoption of Section 3865.

	(iv)		Comprehensive Income

			This section establishes standards for the reporting and disclosure of other comprehensive income [“OCI”] in a new category, Accumulated Comprehensive Income, which will be added to shareholders’ equity on the consolidated balance sheet. Comprehensive income includes all changes in equity of the Company during a period except those resulting from investments by shareholders and distributions to shareholders. The major components included in Accumulated Comprehensive Income are unrealized gains and losses on financial assets classified as available for sale, and unrealized foreign exchange gains and losses arising on translation of the financial statements of self-sustaining foreign operations.

			As a result of previously preparing the Company’s financial statements in accordance with U.S. GAAP,

Page 2

OSI Geospatial Inc.
Notes to the Consolidated Financial Statements (unaudited)
Three and Six Months Ended May 31, 2007 and 2006

the adoption of Section 1530 alongside the conversion to Canadian GAAP has not resulted in any change in disclosure on the Company’s balance sheet.

Change in reporting currency

		Effective March 1, 2006, the Company adopted the U.S. dollar as its reporting currency. In general this change results from an increase in the overall proportion of business activities conducted in U.S. dollars. The change was effected by translating assets and liabilities at the existing U.S./Canadian dollar foreign exchange spot rate on the last day of the month, while earnings were translated at the average rate for each month. Equity transactions have been translated at historical rates; with opening equity restated at the rate of exchange on December 1, 2001. The resulting net translation adjustment has been credited to the foreign currency translation adjustment.

		Prior to March 1, 2006, the reporting currency of the Company was Canadian dollars.

	4		Acquisitions

	a)		Liddy International Inc.

		On April 23, 2007, the Company through its subsidiary CHI Systems Inc., acquired the assets of Liddy International Inc. (“Liddy”), a United States defense contracting company and established Layered Security Solutions (“LSS”). LSS provides business continuity solutions against hazards and has the capability to develop deterrence, response and recovery strategies designed to deal with global threats to business and government. Under the terms of the agreement, the Company paid approximately $184,000 for assets and goodwill of Liddy, of which $25,000 was paid in cash with the balance paid by the issuance of 300,000 common shares of the Company of which 200,000 common shares are held in escrow subject to the satisfaction of certain contractual provisions.

		The following table summarizes the fair value of the assets acquired by the Company at April 23, 2007, the date of acquisition. The acquisition was accounted for using the purchase method whereby assets acquired were recorded at their fair values at April 23, 2007. The excess of the purchase price over the fair market value was recorded as goodwill. The allocation of the purchase price is preliminary and the final allocation may be subject to refinement in the next six months subject to the final review by an independent business valuator.


In thousands of U.S. dollars
Assets
Furniture and Fixtures	$	8
Computer Equipment		17
Goodwill		200

Total assets acquired		225


Net assets acquired (cash and common share consideration)		184
Direct acquisition costs incurred by the Company		41


Total acquisition costs	$	225

Less fair value of net identifiable assets acquired		25


Goodwill		200

The assets acquired are fully deductible for US tax purposes.

CHI Systems Inc.

Page 3

OSI Geospatial Inc.
Notes to the Consolidated Financial Statements (unaudited)
Three and Six Months Ended May 31, 2007 and 2006

		On December 14, 2005, the Company acquired CHI Systems Inc. (“CHI Systems”), a United States defense contracting company. CHI Systems has multiple offices in the United States and is a supplier of technology and services to the U.S. Department of Defense and key defense prime contractors. Under the terms of the agreement, the Company paid approximately $9.0 million for 100% of the outstanding shares of CHI Systems, of which $8.1 million was paid in cash with the balance paid by the issuance of 1,067,975 common shares of the Company. Information regarding this acquisition can be found in the company’s audited consolidated financial statements for the year ended November 30, 2006 as reported in our 2006 Annual Report filed on SEDAR at www.sedar.com or our annual Form 20-F reported on EDGAR at www.sec.gov. The results of CHI Systems’ operations have been included in the consolidated financial statements commencing December 14, 2005.

5		Accounts receivable


In thousands of U.S. dollars
	May 31, 2007			November 30, 2006
Trade	$	3,427		$	5,143
Unbilled revenue		4,177			7,257
Technology Partnerships Canada contribution		102			269
Other		58			97
Allowance for doubtful accounts		(63	)		(59	)


	$	7,701		$	12,707

Inventory


In thousands of U.S. dollars
	May 31, 2007		November 30, 2006
Materials and components	$	927	$	958
Finished goods		487		105


	$	1,414	$	1,063

Capital Stock

Class A preference shares

Issued and outstanding common shares

During the six months ended May 31, 2007, 79,070 Class B preference shares were converted into 4,651,175 common shares. The Class B preference shares were reduced, and the common shares were increased, by $2.0 million, the carrying value of the shares converted An additional 300,000 common shares were issued as part of the Liddy acquisition (note 4a).

Stock option plans

A summary of the status of the Company’s stock option plans at May 31, 2007 is as follows:

Page 4

OSI Geospatial Inc.
Notes to the Consolidated Financial Statements (unaudited)
Three and Six Months Ended May 31, 2007 and 2006


In U.S. dollars
				Weighted average
	Number of shares			exercise price
Outstanding – November 30, 2006		3,417,584		$	0.89
Granted		625,000			0.59
Cancelled		(203,000	)		0.85
Expired		(664,668	)		1.02

Outstanding – May 31, 2007		3,174,916		$	0.80

Exercisable – May 31, 2007		3,071,582		$	0.81

		Stock-based compensation

		For the three and six months ended May 31, 2007 the Company incurred non-cash stock-based compensation expense of $87,000 and $139,000 related to 625, 000 stock options granted (three and six months ended May 31, 2006 — $78,000 and $104,000). Of the options granted in the six month period ended May 31, 2007, 521,000 options vested immediately, 52,000 will vest in one year and 52,000 will vest in two years after the grant date. The expense was included in general and administrative costs and was recorded in contributed surplus.

		The fair value of stock options was estimated using the Black-Scholes option pricing model using the following weighted average assumptions by grant year:


	2007			2006
Risk-free interest rate		4.09	%		2.98	%
Volatility		49	%		54	%
Estimated average option lives	5 years			5 years
Dividend yield		0.0	%		0.0	%

Loss per share


In thousands of U.S. dollars except share related data	For the three months ended May 31,
Loss per share – basic and diluted	2007			2006
Net earnings (loss) for the period	$	(366	)	$	87

Less:

Class B preference share dividends		(382	)		(526	)


Net loss available to common shareholders	$	(748	)	$	(439	)


Weighted average number of common shares outstanding – basic and diluted		39,251,264			32,301,357


Loss per share – basic and diluted	$	(0.02	)	$	(0.01	)

Page 5

OSI Geospatial Inc.
Notes to the Consolidated Financial Statements (unaudited)
Three and Six Months Ended May 31, 2007 and 2006


In thousands of U.S. dollars except share related data	For the six months ended May 31,
Loss per share – basic and diluted	2007			2006
Net loss for the period	$	(2,355	)	$	(1,143	)

Less:

Class B preference share dividends		(382	)		(526	)


Net loss available to common shareholders	$	(2,737	)	$	(1,669	)


Weighted average number of common shares outstanding – basic and diluted		38,248,619			31,790,928


Loss per share – basic and diluted	$	(0.07	)	$	(0.05	)

		The Class A preference shares – Series A, the Class B preference shares Series 2, the outstanding warrants and stock options were anti-dilutive for the purposes of calculating diluted earnings (loss) per share for the three and six months ended May 31, 2007 and 2006.

		If all preferred shares were converted, and all warrants and options were exercised, there would be a total of 68,591,764 common shares outstanding at May 31, 2007 (November 30, 2006 – 68,834,425). As a result of the exercise of all warrants and options, the Company would receive cash of $13.8 million (November 30, 2006 — $13.4 million).

8		Commitments and Contingency

		The Company has entered into a one year guarantee for one of the Company’s subsidiaries, CHI Systems Inc. The Company has guaranteed CHI’s bank line of credit that was put in place by the previous owners prior to OSI Geospatial’s acquisition of CHI. The maximum potential amount of future payments the Company could be required to make under this guarantee is $600,000. At May 31, 2007, the carrying amount of the liability was nil.

		In July 2002, two of the Company’s subsidiaries, Offshore Systems Ltd. and OSI Geomatics Ltd. (now Mapcon Mapping Ltd.), and four employees became subject to a lawsuit for an undisclosed amount by Triathlon Ltd., a subsidiary of MacDonald, Dettwiler and Associates Ltd., related to use of confidential information and breach of fiduciary duty. No amount has been accrued at May 31, 2007 in respect of these claims because the potential liability for the claims and the amount of damages, if any, cannot be reasonably estimated.

		In January 2007, the Company signed a 10 year lease for new office facilities in Burnaby, British Columbia. It relocated its North Vancouver, British Columbia operations to Burnaby, British Columbia on August 1, 2007.

		In April 2007, the Company signed a three year lease for new office facilities in Kanata, Ontario. It opened a corporate head office in Kanata on June 1, 2007.

9		Income taxes

		The Company is subject to income taxes in Canada and the United States and the use of estimates is required in determining the Company’s provision for income taxes. Although the Company believes its tax estimates are reasonable, the ultimate tax determination involves significant judgement that could become subject to audit by tax authorities in the ordinary course of business. The effective rate used to record income tax expense for the three and six months ended May 31, 2007 differed from the Canadian federal and provincial combined statutory tax rate primarily due to the change in valuation allowance to reflect those future tax benefits that were more likely than not to be realized and items not deductible for income tax purposes. The change in effective tax rate from 2007 to 2006 was due primarily to the effect of the change in valuation allowance.

Page 6

OSI Geospatial Inc.
Notes to the Consolidated Financial Statements (unaudited)
Three and Six Months Ended May 31, 2007 and 2006

At May 31, 2007, the Company adjusted its valuation allowance against future income tax assets to reflect the amount of the future tax benefit that was more likely than not to be realized. A valuation allowance continues to be provided against those future income tax assets for which there is significant uncertainty of future realization.


In thousands of U.S. dollars	Three months ended May 31,						Six months ended May 31,
	2007			2006			2007			2006
Future income tax expense (recovery)	$	(19	)	$	(39	)	$	(50	)	$	(23	)
Current income tax expense (recovery)		(61	)		46			42			20

Income tax expense	$	(80	)	$	7		$	(8	)	$	(3	)


Effective tax rate		18%			7%			0%			0%

10		Segmented information

		The Company’s reportable segments are as outlined below. The Company defines reportable segments as components of the Company about which separate financial information is available and which is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance.


In thousands of U.S. dollars	Three Months Ended May 31, 2007
									Corporate
	International		U.S.						and Public
	Systems		Systems			Mapping			Company
	Operations		Operations			Operations			Costs			Total
Revenue	$	2,444	$	2,319		$	1,375		$	—		$	6,138
Gross profit		1,547		444			464			—			2,455
Technology Partnerships Canada		107		—			—			—			107
Interest expense		—		1			—			4			5
Income tax expense (recovery)		—		(66	)		(49	)		35			(80	)
Net earnings (loss)		213		(96	)		131			(614	)		(366	)
Equipment and furnishings expenditures		34		7			6			10			57
Intangible expenditures		1		32			6			—			39
Depreciation and amortization	$	53	$	(7	)	$	37		$	1		$	84

Page 7

OSI Geospatial Inc.
Notes to the Consolidated Financial Statements (unaudited)
Three and Six Months Ended May 31, 2007 and 2006


In thousands of U.S. dollars	Six Months Ended May 31, 2007
										Corporate
	International			U.S.						and Public
	Systems			Systems			Mapping			Company
	Operations			Operations			Operations			Costs			Total
Revenue	$	3,144		$	4,667		$	1,898		$	—		$	9,709
Gross profit		1,584			964			576			—			3,124
Technology Partnerships Canada		137			—			—			—			137
Interest expense		—			1			—			26			27
Income tax expense		—			(12	)		(61	)		65			(8	)
Net earnings (loss)		(943	)		(17	)		(78	)		(1,317	)		(2,355	)
Equipment and furnishings expenditures		47			13			14			10			84
Intangible expenditures		11			38			12			—			61
Depreciation and amortization	$	103		$	70		$	73		$	2		$	248


In thousands of U.S. dollars	Three Months Ended May 31, 2006
								Corporate
	International		U.S.					and Public
	Systems		Systems		Mapping			Company
	Operations		Operations		Operations			Costs			Total
Revenue	$	2,436	$	2,370	$	1,334		$	—		$	6,140
Gross profit		1,614		544		437			—			2.595
Technology Partnerships Canada — net		185		—		—			—			185
Interest expense		—		—		—			6			6
Income tax expense (recovery)		1		9		(2	)		(1	)		7
Net earnings (loss)		653		49		121			(736	)		87
Equipment and furnishings expenditures		28		11		—			—			39
Intangible expenditures		19		13		21			—			53
Depreciation and amortization	$	51	$	80	$	69		$	1		$	201


In thousands of U.S. dollars	Six Months Ended May 31, 2006
								Corporate
	International		U.S.					and Public
	Systems		Systems		Mapping			Company
	Operations		Operations		Operations			Costs			Total
Revenue	$	3,718	$	4,221	$	1,863		$	—		$	9,802
Gross profit		2,293		967		528			—			3,788
Technology Partnerships Canada — net		339		—		—			—			339
Interest expense		—		—		—			12			12
Income tax expense (recovery)		—		6		(9	)		—			(3	)
Net earnings (loss)		260		49		(120	)		(1,332	)		(1,143	)
Equipment and furnishings expenditures		46		16		25			—			87
Intangible expenditures		51		13		29			—			93
Depreciation and amortization	$	98	$	152	$	137		$	2		$	389

Page 8

OSI Geospatial Inc.
Notes to the Consolidated Financial Statements (unaudited)
Three and Six Months Ended May 31, 2007 and 2006


In thousands of U.S. dollars	Total assets employed
							Corporate
	International		U.S.				and Public
	Systems		Systems		Mapping		Company
	Operations		Operations		Operations		Costs			Total
As at May 31, 2007	$	6,052	$	10,316	$	3,167	$	573		$	20,108


As at November 30, 2006	$	10,483	$	10,599	$	3,283	$	(20	)	$	24,345

Geographically, revenues reported are based on the location of the Company’s customers as follows:


In thousands of U.S. dollars	Three months ended May 31,				Six months ended May 31,
	2007		2006		2007		2006
Europe	$	1,627	$	215	$	1,945	$	387
Australia/New Zealand		174		387		352		774
United States		3,306		4,563		5,879		6,848
Canada		1,031		975		1,533		1,793

Total	$	6,138	$	6,140	$	9,709	$	9,802

Geographically, equipment and furnishings, and intangible and other assets are reported based on location. At May 31, 2007 and November 30, 2006, all of the Company’s equipment and furnishings, and intangible and other assets were located in Canada and the U.S. as follows:


In thousands of U.S. dollars	May 31, 2007
	Canada		U.S.		Total
Equipment and furnishings	$	861	$	248	$	1,109
Intangible and other assets		308		440		748
Goodwill		—		8,330		8,330

Total	$	1,169	$	9,018	$	10,187


In thousands of U.S. dollars	November 30, 2006
	Canada		U.S.		Total
Equipment and furnishings	$	859	$	230	$	1,089
Intangible and other assets		322		472		794
Goodwill		—		8,129		8,129

Total	$	1,181	$	8,831	$	10,012

Page 9

TABLE OF CONTENTS


SIGNATURE

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.



By:	“ Ken Kirkpatrick”

	Title:	President & CEO

Date: ~~March~~ 20October 15, 2007

Filing Compare · OSI GEOSPATIAL INC.