6-K 1 b319978_6k.txt REPORT OF FOREIGN ISSUER SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 6-K Report of Foreign Issuer PURSUANT to Rule 13a-16 or 15d-16 of the Securities Exchange Act of 1934 Filing No. 1 for the month of August 2002 Belzberg Technologies Inc. -------------------------- (Exact name of Registrant) 40 King Street West, Suite 3400, Toronto, Ontario, Canada M5H 3Y2 ----------------------------------------------------------------- (Address of principal executive offices) Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F Form 20-F X Form 40-F ----- ----- 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 No X ----- ----- BELZBERG TECHNOLOGIES INC. Belzberg Technologies Inc. filed the following document with the SEDAR: 1. Press Release regarding second quarter filings for 2002. 2. Financial Statements for 6 months ended June 30, 2002. 3. Management's Discussion and Analysis for 6 months ended June 30, 2002. The above-referenced documents are filed as exhibits to this Form 6-K. Exhibit 1. Press Release Exhibit 2. Financial Statements Exhibit 3. Management's Discussion and Analysis SIGNATURES 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. Date: August 20, 2002 BELZBERG TECHNOLOGIES INC. By: /s/ J. Stephen Wilson ------------------------------------ J. Stephen Wilson Chief Financial Officer

Three Months Ended March 31, Years Ended December 31, (Unaudited) (Audited) ----------------------------------------------------------------------------- -------------------------------------------------- 2002 2001 2001 2000 1999 ($) ($) ($) ($) ($) -------------------------------------------------------------- -------------- ---------------- --------------- ----------------- Revenue 7,101,601 4,550,082 24,460,071 11,951,029 5,904,099 Administration 1,750,187 745,059 6,582,597 2,676,014 2,356,019 Amortization(1) 488,669 399,602 1,799,338 841,279 219,591 Loss from Continuing Operations(1) (1,853,841) (133,819) (2,891,143) (147,834) (2,659,068) Loss per Share from Continuing (0.17) (0.01) (0.26) (0.02) (0.38) Operations(1) Net Loss for the Period(1) (1,853,841) (383,341) (4,084,444) (346,062) (2,659,068) Loss per Share(1) (0.17) (0.04) (0.37) (0.04) (0.38) Total Assets 15,671,313 19,524,160 17,450,515 15,459,525 2,869,254 Current Liabilities 5,537,243 3,150,163 5,134,444 3,264,397 5,133,183 Capital Lease Obligations 2,705,631 2,796,774 2,892,434 2,280,377 409,166 Share Capital(2) 24,627,153 24,403,936 24,596,153 19,740,081 6,227,000 Deficit (15,645,285) (9,850,627) (13,791,444) (9,075,468) (8,729,406) Shareholders' Equity (Deficiency) 8,981,868 14,553,309 10,804,709 10,664,613 (2,502,406) -------------------------------------------------------------- -------------- ---------------- --------------- ----------------- Total Liabilities and Shareholders' Equity 15,671,313 19,524,160 17,450,515 15,459,525 2,869,254 ============================================================== ============== ================ =============== =================

======================================================================================================== ========================= North America Europe -------------------------------------------------------------------------------------------------------- ------------------------- Stock Exchanges: Options Exchanges: ECNs: NASDAQ Market Makers: Stock Exchanges: New York Chicago (CBOE) Instinet Mayer Schweitzer (MASH) London American Montreal (MOE) Island Herzog Frankfurt Pacific Bloomberg Tradebook Sherwood Boston Archipelago (Terra Nova) Tradetek Chicago Spear Leads Redibook Cantor Fitzgerald Philadelphia State Street Lattice Trimark Toronto EVWAP DE Shaw Canadian Venture Exchange Brut Knight Securities Troster Singer ======================================================================================================== =========================

=================================== ============================================= ========================== ======================= Location Principal Use Expiration Date of Lease Approximate Number of Square Feet ----------------------------------- --------------------------------------------- -------------------------- ----------------------- 40 King Street West Technical, administrative and executive October 31, 2009 22,000 Toronto, Ontario offices ----------------------------------- --------------------------------------------- -------------------------- ----------------------- 55 Broad Street Marketing, service and support offices January 31, 2008 6,500 New York, New York ----------------------------------- --------------------------------------------- -------------------------- ----------------------- 360 St. Jacques West Marketing, service and support offices May 31, 2007 1,400 Montreal, Quebec ----------------------------------- --------------------------------------------- -------------------------- ----------------------- 141 West Jackson Blvd. Marketing, service and support offices July 31, 2002 1,000 Chicago, Illinois ----------------------------------- --------------------------------------------- -------------------------- ----------------------- 75 Cannon Street Marketing, service and support offices Quarterly 200 London, England =================================== ============================================= ========================== =======================

====================================== ==================== ==================== ===================== ============================ Authorized Outstanding as at Outstanding as at Pro Forma Outstanding as December 31, 2001 May 31, 2002 at May 31, 2002 -------------------------------------- -------------------- -------------------- --------------------- ---------------------------- Common Shares unlimited 11,060,924 shs 11,033,424 shs 13,763,424 shs(2) ($22,813,253) (1) ($22,756,603) ($36,029,153)(4) -------------------------------------- -------------------- -------------------- --------------------- ---------------------------- Special Warrants 2,730,000 spl wrts nil 2,730,000 spl wrts nil ($13,272,550) (3) ====================================== ==================== ==================== ===================== ============================

========================== ============================== ================================= =================== ================= Name & Municipality of Position with Corporation Principal Occupation No. of Shares Director Since Residence -------------------------- ------------------------------ --------------------------------- ------------------- ----------------- Sidney H. Belzberg Chairman of the Board, Chief Officer of the Corporation 1,135,488 shs 1993 Toronto, Ontario Executive Officer and Director -------------------------- ------------------------------ --------------------------------- ------------------- ----------------- Alicia Belzberg Executive Vice President, Officer of the Corporation 1,583,250 shs 1993 Toronto, Ontario Secretary and Director -------------------------- ------------------------------ --------------------------------- ------------------- ----------------- John L. Engels(1) Vice-Chairman of the Board Vice-Chairman of the nil 2001 Greenwich, Connecticut and Director Corporation and Chairman and CEO of Letteau Ltd., a risk management firm -------------------------- ------------------------------ --------------------------------- ------------------- ----------------- Lawrence J. Cyna, CA Chief Financial Officer and Officer of the Corporation 176,400 shs 1999 Toronto, Ontario Director -------------------------- ------------------------------ --------------------------------- ------------------- ----------------- Donald W. Wilson Chief Operating Officer and Officer of the Corporation 360,000 shs 1994 Toronto, Ontario Director -------------------------- ------------------------------ --------------------------------- ------------------- ----------------- Dr. William Gnam(1)(2) Director Economist, University of Toronto 6,000 shs 1994 Toronto, Ontario -------------------------- ------------------------------ --------------------------------- ------------------- ----------------- Stephen Sadler(1)(2) Director Chairman and CEO of Enghouse 396,000 shs 1997 Toronto, Ontario Systems Limited, a software developer ========================== ============================== ================================= =================== =================

Summary Compensation Table =================================================================================================================================== Annual Compensation Long-Term Compensation Awards ----------------------------------------------------------------------------------- Awards Payouts ----------------------------------------------- Securities Restricted Shares Other Annual Under Options or Restricted Share LTIP All Other Name and Principal Salary Bonus Compensation Granted Units Payouts Compensation Position Year (US$) (US$) (US$) (#) (US$) (US$) (US$) ------------------------- ------ ---------- -------- --------------- --------------- --------------------- ---------- ------------- Sidney H. Belzberg, 2001 278,557 nil nil nil nil nil nil Chairman & Chief 2000 310,696 nil nil nil nil nil nil Executive Officer 1999 315,816 nil nil 550,000 nil nil nil ------------------------- ------ ---------- -------- --------------- --------------- --------------------- ---------- ------------- Alicia Belzberg, 2001 278,557 nil nil nil nil nil nil Executive Vice President 2000 298,685 nil nil nil nil nil nil 1999 310,993 nil nil 550,000 nil nil nil ------------------------- ------ ---------- -------- --------------- --------------- --------------------- ---------- ------------- Donald W. Wilson, 2001 329,557 nil nil nil nil nil nil Chief Operating Officer 2000 247,685 nil nil nil nil nil nil 1999 234,471 nil nil 550,000 nil nil nil ------------------------- ------ ---------- -------- --------------- --------------- --------------------- ---------- ------------- Lawrence J. Cyna, 2001 176,615 38,747 nil 50,000 nil nil nil Chief Financial Officer 2000 168,919 nil nil 50,000 nil nil nil 1999 51,189 nil nil 250,000 nil nil nil ------------------------- ------ ---------- -------- --------------- --------------- --------------------- ---------- ------------- Robert C. Sheehan, 2001 275,000 nil nil 100,000 nil nil nil President of RCS and EBS 2000 33,333 nil nil 50,000 nil nil nil ========================= ====== ========== ======== =============== =============== ===================== ========== =============

=========================== ================== ======================= ================ =========================== ================ Market Value of Name Securities Under % of Total Options Exercise Price Securities Underlying Expiration Date Options Granted Granted to Employees Per Security Options on the Date of (#) in Financial Year ($/Security) Grant ($/Security) --------------------------- ------------------ ----------------------- ---------------- --------------------------- ---------------- Lawrence J. Cyna, 50,000 4.32% $7.00 $7.00 April 9, 2008 Chief Financial Officer --------------------------- ------------------ ----------------------- ---------------- --------------------------- ---------------- Robert C. Sheehan, 100,000 8.64% $8.00 $8.00 March 31, 2006 President of RCS & EBS =========================== ================== ======================= ================ =========================== ================

=========================== ================= ================== ================================= ================================ Unexercised Options at FY-End Value of Unexercised December 31, 2001 in-the-Money Options at FY-End December 31, 2001 Securities ------------------------------------------------------------------ Acquired on Aggregate Value Exercise Realized Exercisable Unexercisable Exercisable Unexercisable Name (#) (US$) (#) (#) (US$) (US$) --------------------------- ----------------- ------------------ ---------------- ---------------- ----------------- --------------- Sidney H. Belzberg, nil nil 500,000 nil nil nil Chairman and Chief Executive Officer --------------------------- ----------------- ------------------ ---------------- ---------------- ----------------- --------------- Alicia Belzberg, nil nil 500,000 nil nil nil Executive Vice President --------------------------- ----------------- ------------------ ---------------- ---------------- ----------------- --------------- Donald W. Wilson, nil nil 500,000 nil nil nil Chief Operating Officer --------------------------- ----------------- ------------------ ---------------- ---------------- ----------------- --------------- Lawrence J. Cyna, nil nil 100,000 nil nil nil Chief Financial Officer --------------------------- ----------------- ------------------ ---------------- ---------------- ----------------- --------------- Robert C. Sheehan, nil nil 150,000 nil nil nil President of RCS & EBS =========================== ================= ================== ================ ================ ================= ===============

======================== =========== ============= ================== ================ ======================== ==================== Current Market Number of Purchase Price Market Value of Value of Optionees Number of Securities of Securities Expiry Date of Securities Under Securities Under Optionees Under Option Under Option Option Option on Date of Grant Option(1) ------------------------ ----------- ------------- ------------------ ---------------- ------------------------ -------------------- All executive officers 3 300,000 $5.00 Aug 16, 2006 $5.00 $4.66 and past-executive 3 1,200,000 $5.00 Sept 30, 2007 $5.00 $4.66 officers of the 1 50,000 $10.00 Apr 9, 2007 $10.00 $4.66 Corporation as a group 1 50,000 $7.00 Apr 9, 2008 $7.00 $4.66 (4 individuals) 1 50,000 $5.05 Apr 6, 2009 $5.05 $4.66 ------------------------ ----------- ------------- ------------------ ---------------- ------------------------ -------------------- All directors and 3 75,000 $3.50 Sept 25, 2006 $3.50 $4.66 past-directors of the 1 50,000 $5.00 Sept 30, 2007 $5.00 $4.66 Corporation who are 2 150,000 $16.75 Sept 14, 2005 $16.75 $4.66 not executive officers 1 175,000 $5.00 Dec 31, 2002 $5.00 $4.66 as a group (4 individuals) ------------------------ ----------- ------------- ------------------ ---------------- ------------------------ -------------------- All employees of the 39 70,900 $4.70 Sept 30, 2006 $4.70 $4.66 Corporation as a group 8 153,000 $8.00 Mar 31, 2006 $8.00 $4.66 3 15,000 $4.50 Jan 15, 2007 $4.50 $4.66 1 8,000 $8.00 Sept 30, 2006 $8.00 $4.66 4 155,000 $3.00 Sept 30, 2007 $3.00 $4.66 1 5,000 $10.00 June 4, 2006 $10.00 $4.66 21 189,400 $5.00 Sept 30, 2007 $5.00 $4.66 1 10,000 $7.00 July 18, 2007 $7.00 $4.66 1 100,000 $5.00 Nov 30, 2007 $5.00 $4.66 1 30,000 $8.00 Mar 22, 2006 $8.00 $4.66 1 5,500 $5.00 May 31, 2006 $5.00 $4.66 1 5,000 $3.70 Oct 15, 2006 $3.70 $4.66 1 20,000 $4.48 Sept 30, 2007 $4.48 $4.66 1 4,000 $5.50 Sept 5, 2006 $5.50 $4.66 1 2,000 $18.00 Nov 15, 2005 $18.00 $4.66 1 2,000 $7.60 Apr 24, 2007 $7.60 $4.66 1 25,000 $7.60 July 27, 2005 $7.60 $4.66 1 1,000 $3.00 July 31, 2007 $3.00 $4.66 1 6,000 $4.11 May 16, 2007 $4.11 $4.66 1 50,000 $5.00 Sept 15, 2002 $5.00 $4.66 5 186,000 $3.00 Sept 30, 2006 $3.00 $4.66 1 27,500 $8.50 July 28, 2005 $8.50 $4.66 1 98,000 $7.50 Aug 18, 2007 $7.50 $4.66 ------------------------ ----------- ------------- ------------------ ---------------- ------------------------ -------------------- Consultants of the 1 125,000 $9.00 Aug 4, 2007 $9.00 $4.66 Corporation as a group 1 125,000 $12.00 Aug 4, 2007 $12.00 $4.66 1 125,000 $15.00 Aug 4, 2007 $15.00 $4.66 1 200,000 $7.00 Apr 17, 2005 $7.00 $4.66 1 75,000 $15.00 Nov 30, 2003 $15.00 $4.66 1 30,000 $15.00 Jan 26, 2003 $15.00 $4.66 1 20,000 $5.50 Mar 20, 2004 $5.20 $4.66 1 20,000 $8.00 Mar 31, 2003 $8.00 $4.66 1 125,000 $8.00 Aug 15, 2006 $8.00 $4.66 1 250,000 $8.00 May 22, 2004 $8.00 $4.66 ======================== =========== ============= ================== ================ ======================== ====================

======================================= =========================== =================================================== % of Common Shares Name Number of Common Shares --------------------------------------------------- Owned Before Exercise of After Exercise of Special Warrants Special Warrants --------------------------------------- --------------------------- -------------------------- ------------------------ Sidney H. Belzberg 1,135,488 shs 10.27% 8.24% --------------------------------------- --------------------------- -------------------------- ------------------------ Alicia Belzberg 1,583,250 shs 14.32% 11.48% ======================================= =========================== ========================== ========================

=================================================== ============================== ================================================= Three Months Ended March 31 Years Ended December 31, (Unaudited) (Audited) --------------------------------------------------- -------------------------------------------------------------------------------- 2002 2001 2001 2000 1999 ($) ($) ($) ($) ($) --------------------------------------------------- -------------------------------------------------------------------------------- Revenue 7,101,601 4,550,082 24,460,071 11,951,029 5,904,099 --------------------------------------------------- --------------- -------------- --------------- ---------------- ---------------- Administration 1,750,187 745,059 6,582,597 2,676,014 2,356,019 --------------------------------------------------- --------------- -------------- --------------- ---------------- ---------------- Amortization(1) 488,669 399,602 1,799,338 841,279 219,591 --------------------------------------------------- --------------- -------------- --------------- ---------------- ---------------- Loss from Continuing Operations(1) (1,853,841) (133,819) (2,891,143) (147,834) (2,659,068) --------------------------------------------------- --------------- -------------- --------------- ---------------- ---------------- Loss per Share from Continuing Operations(1) (0.17) (0.01) (0.26) (0.02) (0.38) --------------------------------------------------- --------------- -------------- --------------- ---------------- ---------------- Net Loss for the Period(1) (1,853,841) (383,341) (4,084,444) (346,062) (2,659,068) --------------------------------------------------- --------------- -------------- --------------- ---------------- ---------------- Loss per Share(1) (0.17) (0.04) (0.37) (0.04) (0.38) --------------------------------------------------- --------------- -------------- --------------- ---------------- ---------------- Total Assets 15,671,313 19,524,160 17,450,515 15,459,525 2,869,254 --------------------------------------------------- --------------- -------------- --------------- ---------------- ---------------- Current Liabilities 5,537,243 3,150,163 5,134,444 3,264,397 5,133,183 --------------------------------------------------- --------------- -------------- --------------- ---------------- ---------------- Capital Lease Obligations 2,705,631 2,796,774 2,892,434 2,280,377 409,166 --------------------------------------------------- --------------- -------------- --------------- ---------------- ---------------- Share Capital(1) 24,627,153 24,403,936 24,596,153 19,740,081 6,227,000 --------------------------------------------------- --------------- -------------- --------------- ---------------- ---------------- Deficit (15,645,285) (9,850,627) (13,791,444) (9,075,468) (8,729,406) --------------------------------------------------- --------------- -------------- --------------- ---------------- ---------------- Shareholders' Equity (Deficiency) 8,981,868 14,553,309 10,804,709 10,664,613 (2,502,406) --------------------------------------------------- --------------- -------------- --------------- ---------------- ---------------- Total Liabilities and Shareholders' Equity 15,671,313 19,524,160 17,450,515 15,459,525 2,869,254 =================================================== =============== ============== =============== ================ ================

======================= ============================================================================================================ Quarters Ended (unaudited) ($000's except for share data) ----------------------- ------------------------------------------------------------------------------------------------------------ Mar. 31, Dec. 31, Sep. 30, Jun. 30, Mar. 31, Dec. 31, Sep. 30, Jun. 30, 2002 2001 2001 2001 2001 2000 2000 2000 ----------------------- ------------ ------------- ------------- -------------- ------------- ------------- ----------- ------------ Revenue $7,102 $7,134 $6,332 $6,444 $4,550 $3,980 $2,935 $2,592 ----------------------- ------------ ------------- ------------- -------------- ------------- ------------- ----------- ------------ Net Earnings (Loss) (1,854) (1,194) (1,550) (957) (383) 87 (217) (251) for Period ----------------------- ------------ ------------- ------------- -------------- ------------- ------------- ----------- ------------ Earnings (Loss) per ($0.17) ($0.11) ($0.14) ($0.09) ($0.04) $0.01 ($0.03) ($0.04) share (basic & diluted) ======================= ============ ============= ============= ============== ============= ============= =========== ============

Selected Financial Data - First Quarter 2002 and 2001 (unaudited) ========================================== ================= ===================================================================== 2002 2001 (unaudited) ------------------------------------------ ----------------- --------------------------------------------------------------------- $000's except per share data Q1 Q1 Q2 Q3 Q4 ------------------------------------------ ----------------- ---------------- ----------------- ---------------- ----------------- Revenue $ 7,102 $ 4,550 $ 6,444 $ 6,332 $ 7,134 ------------------------------------------ ----------------- ---------------- ----------------- ---------------- ----------------- Gross Margin 3,455 2,934 4,046 3,529 3,438 ------------------------------------------ ----------------- ---------------- ----------------- ---------------- ----------------- Loss from continuing operations (1,854) (134) (675) (888) (1,194) ------------------------------------------ ----------------- ---------------- ----------------- ---------------- ----------------- Loss from discontinued operations -- (249) (282) (662) -- ------------------------------------------ ----------------- ---------------- ----------------- ---------------- ----------------- Net loss (1,854) $ (383) $ (957) $ (1,550) $ (1,194) ------------------------------------------ ----------------- ---------------- ----------------- ---------------- ----------------- Basic and diluted loss per common share - from continuing operations $ (0.17) $ (0.01) $ (0.06) $ (0.08) $ (0.11) ------------------------------------------ ----------------- ---------------- ----------------- ---------------- ----------------- - from discontinued operations -- (0.02) (0.03) (0.06) -- ------------------------------------------ ----------------- ---------------- ----------------- ---------------- ----------------- Basic and diluted loss per common share $ (0.17) $ (0.04) $ (0.09) $ (0.14) $ (0.11) ------------------------------------------ ----------------- ---------------- ----------------- ---------------- ----------------- Balance Sheet Data: Cash and cash equivalents $ 5,026 $ 9,110 $ 9,070 $ 7,049 $ 6,361 ------------------------------------------ ----------------- ---------------- ----------------- ---------------- ----------------- Working capital 4,482 11,796 9,786 8,295 6,913 ------------------------------------------ ----------------- ---------------- ----------------- ---------------- ----------------- Total assets 15,671 19,524 20,881 18,438 17,451 ------------------------------------------ ----------------- ---------------- ----------------- ---------------- ----------------- Long-term capital lease obligations 1,152 1,733 1,573 1,561 1,502 ------------------------------------------ ----------------- ---------------- ----------------- ---------------- ----------------- Shareholders' equity 8,982 14,553 13,618 11,849 10,805 ========================================== ================= ================ ================= ================ =================

Selected Financial Data - 2000 (unaudited) ================================================== ================ ================= ================ ================= $000's except per share data Q1 Q2 Q3 Q4 -------------------------------------------------- ---------------- ----------------- ---------------- ----------------- Revenue $ 2,444 $ 2,592 $ 2,935 $ 3,980 -------------------------------------------------- ---------------- ----------------- ---------------- ----------------- Gross Margin 1,745 1,611 1,969 2,096 -------------------------------------------------- ---------------- ----------------- ---------------- ----------------- Earnings (loss) from continuing operations 35 (251) (151) 219 -------------------------------------------------- ---------------- ----------------- ---------------- ----------------- Loss from discontinued operations -- -- (66) (132) -------------------------------------------------- ---------------- ----------------- ---------------- ----------------- Net earnings (loss) $ 35 $ (251) $ (217) $ 87 -------------------------------------------------- ---------------- ----------------- ---------------- ----------------- Basic and diluted earnings (loss) per common share - from continuing operations $ 0.02 $ (0.04) $ (0.02) $ 0.02 -------------------------------------------------- ---------------- ----------------- ---------------- ----------------- - from discontinued operations -- -- (0.01) (0.01) -------------------------------------------------- ---------------- ----------------- ---------------- ----------------- Basic and diluted earnings (loss) per common $ 0.02 $ (0.04) $ (0.03) $ 0.01 share -------------------------------------------------- ---------------- ----------------- ---------------- ----------------- Balance Sheet Data: Cash and cash equivalents $ 5,530 $ 4,640 $ 4,050 $ 5,642 -------------------------------------------------- ---------------- ----------------- ---------------- ----------------- Working capital 5,563 4,922 5,076 7,562 -------------------------------------------------- ---------------- ----------------- ---------------- ----------------- Total assets 8,926 9,250 11,443 15,460 -------------------------------------------------- ---------------- ----------------- ---------------- ----------------- Long-term lease obligations 264 201 1,011 1,418 -------------------------------------------------- ---------------- ----------------- ---------------- ----------------- Shareholders' equity 7,046 6,942 7,448 10,665 ================================================== ================ ================= ================ =================

========================= ========================================== =============================================================== Quarter Ended March 31, Total Revenue for the Years ended December 31, ($000s) --------- ---------- -------- ------------ ----------- ---------- ---------- ---------- -------- --------- 2002 % of 2001 % of 2001 % of 2000 % of 1999 % of Revenue Revenue Revenue Revenue Revenue ------------------------- --------- ---------- -------- ------------ ----------- ---------- ---------- ---------- -------- --------- Subscription Fees $ 2,852 40% $2,348 52% $ 10,596 43% $ 6,080 51% $4,526 77% ------------------------- --------- ---------- -------- ------------ ----------- ---------- ---------- ---------- -------- --------- Transaction Fees 2,924 41% 1,861 41% 8,900 36% 3,276 27% 644 11% ------------------------- --------- ---------- -------- ------------ ----------- ---------- ---------- ---------- -------- --------- Commissions 998 14% -- -- 3,594 15% -- -- -- -- ------------------------- --------- ---------- -------- ------------ ----------- ---------- ---------- ---------- -------- --------- Software Development 35 1% 235 5% 772 3% 2,059 17% 667 11% and Installation ------------------------- --------- ---------- -------- ------------ ----------- ---------- ---------- ---------- -------- --------- Other 293 4% 106 2% 598 3% 536 5% 67 1% ------------------------- --------- ---------- -------- ------------ ----------- ---------- ---------- ---------- -------- --------- Total Revenue $ 7,102 $4,550 $ 24,460 $11,951 $5,904 ========================= ========= ========== ======== ============ =========== ========== ========== ========== ======== =========

=============================== ======================================== ========================================================== Quarter Ended March 31, Revenue by Country for the Years ended December 31, ($000s) ($000s) ---------------------------------------- ---------------------------------------------------------- 2002 % of 2001 % of 2001 % of 2000 % of 1999 % of Revenue Revenue Revenue Revenue Revenue ------------------------------- --------- --------- --------- ---------- --------- -------- --------- --------- --------- --------- Canada Subscription Fees $1,728 73% $ 1,355 74% $6,512 74% $3,213 53% $2,012 75% ------------------------------- --------- --------- --------- ---------- --------- -------- --------- --------- --------- --------- Transaction Fees 443 19% 274 15% 1,336 15% 558 9% 203 8% ------------------------------- --------- --------- --------- ---------- --------- -------- --------- --------- --------- --------- Commissions -- -- -- -- -- -- -- -- -- -- ------------------------------- --------- --------- --------- ---------- --------- -------- --------- --------- --------- --------- Software Development and 26 1% 103 6% 447 5% 1,783 29% 415 15% Installation ------------------------------- --------- --------- --------- ---------- --------- -------- --------- --------- --------- --------- Other 177 7% 99 5% 490 6% 523 9% 50 2% ------------------------------- --------- --------- --------- ---------- --------- -------- --------- --------- --------- --------- Revenue from Canada $2,374 $ 1,831 $8,785 $6,077 $2,680 ------------------------------- --------- --------- --------- ---------- --------- -------- --------- --------- --------- --------- United States Subscription Fees $1,124 24% $ 993 37% $ 4,084 26% $2,867 49% $2,514 78% ------------------------------- --------- --------- --------- ---------- --------- -------- --------- --------- --------- --------- Transaction Fees 2,481 53% 1,587 58% 7,563 48% 2,718 46% 441 14% ------------------------------- --------- --------- --------- ---------- --------- -------- --------- --------- --------- --------- Commissions 998 21% -- -- 3,594 23% -- -- -- -- ------------------------------- --------- --------- --------- ---------- --------- -------- --------- --------- --------- --------- Software Development and 9 -- 132 5% 325 2% 277 5% 252 8% Installation ------------------------------- --------- --------- --------- ---------- --------- -------- --------- --------- --------- --------- Other 116 2% 7 -- 109 1% 12 -- 17 -- ------------------------------- --------- --------- --------- ---------- --------- -------- --------- --------- --------- --------- Revenue from United States $4,728 $ 2,719 $15,675 $5,874 $3,224 =============================== ========= ========= ========= ========== ========= ======== ========= ========= ========= =========

======================= ===================================================================================== Gross Margin for the ------------------------------------------------------------------------------------- Three Months Ended March 31, Years Ended December 31, ($000s) ($000s) ------------------------------------------------------------------------------------- 2002 2001 2001 2000 1999 ----------------------- ------------------ ----------------- -------------- ---------------- ---------------- Revenue $ 7,102 $ 4,550 $ 24,460 $ 11,951 $ 5,904 ----------------------- ------------------ ----------------- -------------- ---------------- ---------------- Cost of Revenue 3,647 1,616 10,513 4,530 2,173 ----------------------- ------------------ ----------------- -------------- ---------------- ---------------- Gross Margin $ 3,455 $ 2,934 $ 13,947 $ 7,421 $ 3,731 ----------------------- ------------------ ----------------- -------------- ---------------- ---------------- Gross Margin % 49% 64% 57% 62% 63% ======================= ================== ================= ============== ================ ================

======================================== ========================================================================================== Operating Expenses for the ------------------------------------------------------------------------------------------ Three Months ended March 31, Years ended December 31, ($000s) ($000s) ----------------------------------------------------------------------------------------------------------------------------------- 2002 % of 2001 % of 2001 % of 2000 % of 1999 % of Revenue Revenue Revenue Revenue Revenue ----------------------- ----------- ---------- --------- --------- ----------- ---------- ---------- --------- --------- ---------- Sales and Marketing $ 1,191(1) 17% $ 1,130 25% $ 5,072(1) 21% $ 2,721 23% $ 1,874 32% ----------------------- ----------- ---------- --------- --------- ----------- ---------- ---------- --------- --------- ---------- Research and 904 13% 767 17% 3,062 12% 2,011 17% 1,794 30% Development ----------------------- ----------- ---------- --------- --------- ----------- ---------- ---------- --------- --------- ---------- Government Assistance -- -- -- -- -- -- (1,150) (10)% -- -- ----------------------- ----------- ---------- --------- --------- ----------- ---------- ---------- --------- --------- ---------- Administration 1,750 24% 745 16% 6,582 27% 2,676 22% 2,356 40% ----------------------- ----------- ---------- --------- --------- ----------- ---------- ---------- --------- --------- ---------- Total Operating $ 3,845 54% $ 2,642 58% $14,716 60% $ 6,258 52% $ 6,024 102% Expenses ======================= =========== ========== ========= ========= =========== ========== ========== ========= ========= ==========

==================================================================================================================================== Other Income and Expenses for the -------------------------------------------------------------------------------------------------------- Three Months Ended March 31, Years ended December 31, ($000s) ($000s) --------------------------- ----------------------------------------- -------------------------------------------------------------- 2002 % of 2001 % of 2001 % of 2000 % of 1999 % of Revenue Revenue Revenue Revenue Revenue --------------------------- --------- ---------- --------- ---------- --------- ---------- ---------- --------- --------- ---------- Amortization of Capital $ 489 7% $ 369 8% $ 1,646 6% $ 793 7% $ 220 4% Assets --------------------------- --------- ---------- --------- ---------- --------- ---------- ---------- --------- --------- ---------- Amortization of Goodwill -- -- 30 1% 153 1% 48 1% -- -- --------------------------- --------- ---------- --------- ---------- --------- ---------- ---------- --------- --------- ---------- Write-down of Leasehold -- -- -- -- 153 1% -- -- 113 2% Improvements --------------------------- --------- ---------- --------- ---------- --------- ---------- ---------- --------- --------- ---------- Interest Expense 138 2% 116 2% 466 2% 166 1% 25 -- --------------------------- --------- ---------- --------- ---------- --------- ---------- ---------- --------- --------- ---------- Interest Income (23) (1)% (98) (2)% (312) (1)% (227) (2)% -- -- --------------------------- --------- ---------- --------- ---------- --------- ---------- ---------- --------- --------- ---------- Stock Exchange Listing -- -- -- -- -- -- 525 4% -- -- Costs --------------------------- --------- ---------- --------- ---------- --------- ---------- ---------- --------- --------- ---------- Restructuring Charges 843 12% -- -- -- -- -- -- -- -- --------------------------- --------- ---------- --------- ---------- --------- ---------- ---------- --------- --------- ---------- Other Expenses, Net $ 1,447 20% $ 417 9% $ 2,106 9% $ 1,305 11% $ 358 6% =========================== ========= ========== ========= ========== ========= ========== ========== ========= ========= ==========

=================================================================================================================== March 31, December 31, December 31, 2002 2001 2000 -------------- -------------- -------------- (unaudited) ASSETS CURRENT Cash and cash equivalents $ 5,025,788 $ 6,361,427 $ 5,641,924 Accounts receivable (Note 3) 4,467,566 4,715,206 3,718,582 Government assistance receivable -- -- 1,149,779 Prepaid expenses and other receivables 525,479 970,681 316,708 ------------------------------------------------------------------------------------------------------------------- 10,018,833 12,047,314 10,826,993 RESTRICTED CASH (Note 4) -- -- 81,000 CAPITAL ASSETS (Note 5) 4,897,241 4,647,962 3,751,182 GOODWILL, net of accumulated amortization of $142,838, $142,838 and $47,711, respectively 755,239 755,239 800,350 ------------------------------------------------------------------------------------------------------------------- $ 15,671,313 $ 17,450,515 $ 15,459,525 =================================================================================================================== LIABILITIES CURRENT Accounts payable and accrued liabilities $ 1,697,303 $ 1,961,393 $ 1,370,967 Accrued restructuring charges 704,158 -- -- Consideration payable (Note 6) -- 362,674 -- Deferred revenue 776,492 786,870 1,031,144 Bank loan (Note 8) 805,861 633,211 -- Current portion of obligations under capital lease (Note 9) 1,553,429 1,390,296 862,286 ------------------------------------------------------------------------------------------------------------------- 5,537,243 5,134,444 3,264,397 DEFERRED REVENUE -- 9,224 112,424 OBLIGATIONS UNDER CAPITAL LEASE (Note 9) 1,152,202 1,502,138 1,418,091 ------------------------------------------------------------------------------------------------------------------- 6,689,445 6,645,806 4,794,912 ------------------------------------------------------------------------------------------------------------------- COMMITMENTS (Note 15) -- -- -- ------------------------------------------------------------------------------------------------------------------- SHAREHOLDERS' EQUITY CAPITAL STOCK (Note 11) 22,813,253 22,813,253 17,957,181 CONTRIBUTED SURPLUS (Note 11 (d) and (g)) 147,000 -- -- WARRANTS (Note 11 (d)) 1,666,900 1,782,900 1,782,900 DEFICIT (15,645,285) (13,791,444) (9,075,468) ------------------------------------------------------------------------------------------------------------------- 8,981,868 10,804,709 10,664,613 ------------------------------------------------------------------------------------------------------------------- $ 15,671,313 $ 17,450,515 $ 15,459,525 ===================================================================================================================

================================================================================================================= Three Months Ended March 31, ---------------------------------- 2002 2001 --------------- ---------------- (unaudited) (unaudited) REVENUE $ 7,101,601 $ 4,550,082 COST OF REVENUE 3,646,972 1,615,520 ----------------------------------------------------------------------------------------------------------------- GROSS MARGIN 3,454,629 2,934,562 ----------------------------------------------------------------------------------------------------------------- OPERATING EXPENSES Sales and marketing 889,126 1,130,307 Research and development Expenditures 903,573 766,928 Government assistance -- -- Administration 1,750,187 745,059 Non-recurring Philadelphia expenses 302,053 -- ----------------------------------------------------------------------------------------------------------------- 3,844,939 2,642,294 ----------------------------------------------------------------------------------------------------------------- OPERATING EARNINGS (LOSS) FROM CONTINUING OPERATIONS BEFORE UNDERNOTED ITEMS (390,310) 292,268 Amortization 488,669 399,602 Write-down of leasehold improvements -- -- Interest expense 138,151 116,256 Restructuring charges (Note 10) 842,620 -- Stock exchange listing costs -- -- Interest income (22,781) (98,385) ----------------------------------------------------------------------------------------------------------------- LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES (1,836,969) (125,205) INCOME TAXES (Note 12) 16,872 8,614 ----------------------------------------------------------------------------------------------------------------- LOSS FROM CONTINUING OPERATIONS (1,853,841) (133,819) LOSS FROM DISCONTINUED OPERATIONS (Note 7) -- (249,522) ----------------------------------------------------------------------------------------------------------------- NET LOSS (1,853,841) (383,341) DEFICIT, BEGINNING OF PERIOD (13,791,444) (9,075,468) PREMIUM ON REPURCHASE OF COMMON SHARES (Note 11 (a)) -- (391,818) ----------------------------------------------------------------------------------------------------------------- DEFICIT, END OF PERIOD $ (15,645,285) $ (9,850,627) ================================================================================================================= LOSS PER SHARE FROM CONTINUING OPERATIONS Basic and diluted $ (0.17) $ (0.01) ================================================================================================================= LOSS PER SHARE Basic and diluted $ (0.17) $ (0.04) ================================================================================================================= WEIGHTED AVERAGE NUMBER OF OUTSTANDING COMMON SHARES 11,060,924 10,948,535 ================================================================================================================= ================================================================================================================================== Year Ended December 31, --------------------------------------------------- 2001 2000 1999 --------------- --------------- --------------- REVENUE $ 24,460,071 $ 11,951,029 $ 5,904,099 COST OF REVENUE 10,512,684 4,529,979 2,172,738 ---------------------------------------------------------------------------------------------------------------------------------- GROSS MARGIN 13,947,387 7,421,050 3,731,361 ---------------------------------------------------------------------------------------------------------------------------------- OPERATING EXPENSES Sales and marketing 4,679,738 2,721,046 1,874,096 Research and development Expenditures 3,061,699 2,010,663 1,794,081 Government assistance -- (1,149,779) -- Administration 6,582,597 2,676,014 2,356,019 Non-recurring Philadelphia expenses 392,195 -- -- ---------------------------------------------------------------------------------------------------------------------------------- 14,716,229 6,257,944 6,024,196 ---------------------------------------------------------------------------------------------------------------------------------- OPERATING EARNINGS (LOSS) FROM CONTINUING OPERATIONS BEFORE UNDERNOTED ITEMS (768,842) 1,163,106 (2,292,835) Amortization 1,799,338 841,279 219,591 Write-down of leasehold improvements 153,195 -- 112,500 Interest expense 466,048 166,393 25,123 Restructuring charges (Note 10) -- -- -- Stock exchange listing costs -- 525,198 -- Interest income (311,965) (226,993) -- ---------------------------------------------------------------------------------------------------------------------------------- LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES (2,875,458) (142,771) (2,650,049) INCOME TAXES (Note 12) 15,685 5,063 9,019 ---------------------------------------------------------------------------------------------------------------------------------- LOSS FROM CONTINUING OPERATIONS (2,891,143) (147,834) (2,659,068) LOSS FROM DISCONTINUED OPERATIONS (Note 7) (1,193,301) (198,228) -- ---------------------------------------------------------------------------------------------------------------------------------- NET LOSS (4,084,444) (346,062) (2,659,068) DEFICIT, BEGINNING OF PERIOD (9,075,468) (8,729,406) (6,070,338) PREMIUM ON REPURCHASE OF COMMON SHARES (Note 11 (a)) (631,532) -- -- ---------------------------------------------------------------------------------------------------------------------------------- DEFICIT, END OF PERIOD $ (13,791,444) $ (9,075,468) $ (8,729,406) ================================================================================================================================== LOSS PER SHARE FROM CONTINUING OPERATIONS Basic and diluted $ (0.26) $ (0.02) $ (0.38) ================================================================================================================================== LOSS PER SHARE Basic and diluted $ (0.37) $ (0.04) $ (0.38) ================================================================================================================================== WEIGHTED AVERAGE NUMBER OF OUTSTANDING COMMON SHARES 10,998,383 9,635,780 7,015,635 ==================================================================================================================================

================================================================================================== Three Months Ended March 31, -------------------------------- 2002 2001 -------------- -------------- (unaudited) (unaudited) CASH (USED FOR) PROVIDED BY OPERATING ACTIVITIES Loss from continuing operations $ (1,853,841) $ (133,819) Items not affecting cash Amortization of capital assets 488,669 369,314 Amortization of goodwill -- 30,288 Amortization of gain on sale and leaseback of capital assets (26,384) (24,378) Write-down of leasehold improvements -- -- Services rendered for capital stock consideration (Note 11) -- -- Changes in non-cash working capital items (Note 13) 1,170,692 (484,685) -------------------------------------------------------------------------------------------------- (220,864) (243,280) -------------------------------------------------------------------------------------------------- INVESTING ACTIVITIES Purchase of capital assets (558,902) (108,209) Payment of consideration due from acquisition of Robert C. Sheehan & Associates, Inc. (362,674) -- Proceeds from disposal of capital assets -- -- Acquisitions, net of cash acquired (Note 6) -- -- -------------------------------------------------------------------------------------------------- (921,576) (108,209) -------------------------------------------------------------------------------------------------- FINANCING ACTIVITIES Note payable -- -- Repayment of note payable -- -- Repayment of obligations under capital lease (365,849) (243,236) Proceeds from bank loan 255,558 -- Repayment of bank loan (82,908) -- Net proceeds from issuance of common shares -- 4,698,991 Proceeds from the exercise of stock options -- 20,000 Repurchase of common stock -- (475,424) Proceeds on issuance of warrants -- -- -------------------------------------------------------------------------------------------------- (193,199) 4,000,331 -------------------------------------------------------------------------------------------------- NET (DECREASE) INCREASE IN CASH FROM CONTINUING OPERATIONS (1,335,639) 3,648,842 NET CASH UTILIZED BY DISCONTINUED OPERATIONS -- (180,599) -------------------------------------------------------------------------------------------------- NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS (1,335,639) 3,468,243 CASH AND CASH EQUIVALENTS (BANK INDEBTEDNESS), BEGINNING OF PERIOD 6,361,427 5,641,924 -------------------------------------------------------------------------------------------------- CASH AND CASH EQUIVALENTS (BANK INDEBTEDNESS), END OF PERIOD $ 5,025,788 $ 9,110,167 ================================================================================================== CASH EQUIVALENTS: Cash $ 3,099,661 $ 2,863,047 Short-term investments 1,926,127 6,247,120 -------------------------------------------------------------------------------------------------- $ 5,025,788 $ 9,110,167 ================================================================================================== SUPPLEMENTAL CASH FLOW INFORMATION Value of share capital issued for acquisitions of subsidiaries $ -- $ -- Value of share capital issued for services $ -- $ -- Value of share capital recorded for compensation expense (Note 6) $ -- $ 28,470 Acquisition of capital assets with debt $ 179,046 $ 237,910 Interest paid $ 138,151 $ 116,256 Income taxes paid $ 16,872 $ 8,614 ===================================================================================================================== Year Ended December 31, ------------------------------------------------- 2001 2000 1999 --------------- -------------- -------------- CASH (USED FOR) PROVIDED BY OPERATING ACTIVITIES Loss from continuing operations $ (2,891,143) $ (147,834) $ (2,659,068) Items not affecting cash Amortization of capital assets 1,646,540 793,568 219,591 Amortization of goodwill 152,798 47,711 -- Amortization of gain on sale and leaseback of capital assets (104,684) (28,370) -- Write-down of leasehold improvements 153,195 -- 112,500 Services rendered for capital stock consideration (Note 11) -- 200,000 -- Changes in non-cash working capital items (Note 13) 1,055,293 (4,974,393) 898,384 --------------------------------------------------------------------------------------------------------------------- 11,999 (4,109,318) (1,428,593) --------------------------------------------------------------------------------------------------------------------- INVESTING ACTIVITIES Purchase of capital assets (1,466,424) (1,295,030) (582,592) Payment of consideration due from acquisition of Robert C. Sheehan & Associates, Inc. -- -- -- Proceeds from disposal of capital assets -- 767,020 -- Acquisitions, net of cash acquired (Note 6) (683,440) (183,050) -- --------------------------------------------------------------------------------------------------------------------- (2,149,864) (711,060) (582,592) --------------------------------------------------------------------------------------------------------------------- FINANCING ACTIVITIES Note payable -- -- 1,154,640 Repayment of note payable -- (1,154,640) -- Repayment of obligations under capital lease (1,122,347) (815,322) (146,213) Proceeds from bank loan 744,442 -- -- Repayment of bank loan (111,231) -- -- Net proceeds from issuance of common shares 4,698,991 7,588,241 321,775 Proceeds from the exercise of stock options 205,000 3,210,000 775,757 Repurchase of common stock (816,011) -- -- Proceeds on issuance of warrants -- 1,782,900 -- --------------------------------------------------------------------------------------------------------------------- 3,598,844 10,611,179 2,105,959 --------------------------------------------------------------------------------------------------------------------- NET (DECREASE) INCREASE IN CASH FROM CONTINUING OPERATIONS 1,460,979 5,790,801 94,774 NET CASH UTILIZED BY DISCONTINUED OPERATIONS (741,476) (131,833) -- --------------------------------------------------------------------------------------------------------------------- NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS 719,503 5,658,968 94,774 CASH AND CASH EQUIVALENTS (BANK INDEBTEDNESS), BEGINNING OF PERIOD 5,641,924 (17,044) (111,818) --------------------------------------------------------------------------------------------------------------------- CASH AND CASH EQUIVALENTS (BANK INDEBTEDNESS), END OF PERIOD $ 6,361,427 $ 5,641,924 $ (17,044) ===================================================================================================================== CASH EQUIVALENTS: Cash $ 4,705,375 $ 1,962,776 $ -- Short-term investments 1,656,052 3,679,148 -- --------------------------------------------------------------------------------------------------------------------- $ 6,361,427 $ 5,641,924 $ -- ===================================================================================================================== SUPPLEMENTAL CASH FLOW INFORMATION Value of share capital issued for acquisitions of subsidiaries $ -- $ 675,000 $ -- Value of share capital issued for services $ -- $ 200,000 $ -- Value of share capital recorded for compensation expense (Note 6) $ 136,560 $ 56,940 $ -- Acquisition of capital assets with debt $ 1,212,681 $ 2,686,533 $ -- Interest paid $ 466,048 $ 166,393 $ 104,365 Income taxes paid $ 7,632 $ -- $ 9,019

Three months ended March 31, Year ended December 31, ---------------------------------- --------------------------------------------------- 2002 2001 2001 2000 1999 ------------ ---------- ------------ ---------- ------------- (unaudited) Net Loss As reported $ (1,853,841) $ (383,341) $ (4,084,444) $ (346,062) $ (2,659,068) Add back: Goodwill amortization -- 30,288 152,798 47,711 -- ---------------------------------------------------------------------------------------------------------------------------------- Adjusted loss for the period $ (1,853,841) $ (353,053) $ (3,931,646) $ (298,351) $ (2,659,068) ================================================================================================================================== Basic and diluted loss per share As reported $ (0.17) $ (0.04) $ (0.37) $ (0.04) $ (0.38) Adjusted loss for the period $ (0.17) $ (0.03) $ (0.36) $ (0.03) $ (0.38)

March 31, 2002 December 31, 2001 December 31, 2000 ------------------------------- ----------------------------------- ------------------------------- Accumulated Accumulated Accumulated Cost Amortization Cost Amortization Cost Amortization ------------- --------------- -------------- ------------------ ------------ --------------- (unaudited) Furniture and equipment $ 616,535 $ 134,423 $ 534,739 $ 123,562 $ 343,894 $ 77,671 Computer equipment 1,485,294 805,026 1,203,129 732,762 968,520 393,056 Computer equipment and software under capital lease 4,447,578 2,074,233 4,280,810 1,715,211 3,160,393 510,935 Leasehold improvements 1,459,231 97,715 1,255,505 54,686 294,493 34,456 ------------------------------------------------------------------------------------------------------------------------------------ 8,008,638 $ 3,111,397 7,274,183 $ 2,626,221 4,767,300 $ 1,016,118 Accumulated amortization 3,111,397 2,626,221 1,016,118 ------------------------------------------------------------------------------------------------------------------------------------ Net book value $ 4,897,241 $ 4,647,962 $ 3,751,182 ====================================================================================================================================

Common Shares --------------- December 31, 2001 12,500 July 31, 2002 9,000 ----------------------------------------------------------------------------------------------------------------------------------- Total 21,500 ===================================================================================================================================

Three months ended March 31, Years ended December 31, ----------------------------------- ------------------------------------------------- 2002 2001 2001 2000 1999 ---------------- ---------------- ---------------- -------------- -------------- (unaudited) Revenues $ -- $ 16,610 $ 30,668 $ -- $ -- =========================================================================================================================== Loss before the following -- 221,052 746,451 141,288 -- Stock compensation expense (Note 6) -- 28,470 136,560 56,940 Impairment charge for goodwill -- -- 310,290 -- -- --------------------------------------------------------------------------------------------------------------------------- Net loss from discontinued operations $ -- $ 249,522 $ 1,193,301 $ 198,228 $ -- =========================================================================================================================== Assets and liabilities Current assets $ -- $ 98,744 $ 26,450 $ 28,555 $ -- Capital assets $ -- $ 8,159 $ -- $ 8,589 $ -- Goodwill, net of accumulated amortization $ -- $ 325,138 $ -- $ 349,710 $ -- Current liabilities $ -- $ 66,820 $ 14,418 $ 8,459 $ --

March 31, December 31, ---------------------- ------------------------------------------------ 2002 2001 2000 ---------------------- -------------------- --------------------- (unaudited) 2001 $ -- $ -- $1,210,542 2002 1,348,004 1,710,448 1,065,510 2003 1,275,373 1,215,244 577,479 2004 414,534 391,588 -- 2005 6,821 -- -- ----------------------------------------------------------------------------------------------------------------------------------- 3,044,732 3,317,280 2,853,531 Less interest portion at average annual rates of approximately 11% 339,101 424,846 573,154 ----------------------------------------------------------------------------------------------------------------------------------- 2,705,631 2,892,434 2,280,377 Less current portion 1,553,429 1,390,296 862,286 ----------------------------------------------------------------------------------------------------------------------------------- $1,152,202 $1,502,138 $1,418,091 ===================================================================================================================================

Authorized Unlimited number of common shares Issued Common Shares ---------------------------------------------------- Number Amount ---------------------- ----------------------- Balance, January 1, 2000 7,703,590 $ 6,227,000 Issue of common shares for cash 2,013,800 7,974,241 Share issuance costs -- (386,000) Issue of common shares in connection with acquisition of eContracts, Inc. (Note 6) 25,000 225,000 Compensation expense (Note 6) -- 56,940 Issue of common shares in connection with acquisition of Electronic Brokerage Systems, Inc. (Note 6) 50,000 450,000 Exercise of options for cash 899,000 3,210,000 Issue of common shares for services rendered 40,000 200,000 ------------------------------------------------------------------------------------------------------------------------------------ Balance, December 31, 2000 10,731,390 17,957,181 Issue of common shares for cash 333,334 5,000,000 Share issuance costs -- (301,009) Exercise of options for cash 66,600 205,000 Compensation expense (Note 6) 21,500 136,560 Repurchase of common shares for cancellation (91,900) (184,479) ------------------------------------------------------------------------------------------------------------------------------------ Balance, December 31, 2001 and March 31, 2002 11,060,924 $ 22,813,253 ===================================================================================================================================

Price of Common Share Number of to be Purchased Warrants Per Warrant Expiry Date --------------------- ---------------------------- --------------------------- 650,000 $ 4.00 February 10, 2005 600,000 10.00 February 14, 2003 500,000 5.00 February 14, 2005 50,000 7.76 March 31, 2002 ----------------------------------------------------------------------------------------------------------------------------------- 1,800,000 $ 6.38 (weighted average) ===================================================================================================================================

Weighted Number of Average Options Exercise Price ------------------- ---------------------- Options outstanding at January 1, 2000 3,397,500 $ 4.38 Options granted 1,391,000 10.58 Options exercised (899,000) 3.57 ------------------------------------------------------------------------------------------------------------------------------------ Options outstanding at December 31, 2000 3,889,500 6.83 Options granted 1,582,050 6.05 Options exercised (66,600) 3.08 Options cancelled (376,800) 9.98 ------------------------------------------------------------------------------------------------------------------------------------ Options outstanding at December 31, 2001 5,028,150 6.44 Options granted 35,000 5.07 Options exercised - - Options cancelled (676,600) 4.50 ------------------------------------------------------------------------------------------------------------------------------------ Options outstanding at March 31, 2002 (unaudited) 4,386,550 $ 6.72 =================================================================================================================================== Options exercisable at March 31, 2002 (unaudited) 3,650,317 $ 6.19 ===================================================================================================================================

Outstanding Exercisable ------------------------------------------------------------------------------------------ -------------------------------------- Weighted Weighted Weighted Range of Average Average Average Exercise Number Remaining Exercise Number Exercise Prices Outstanding Life (*) Price Exercisable Price --------------------------- ----------------- ------------------ ------------------- ------------------- ---------------- $3.00 - $5.00 3,338,650 5.29 $ 4.64 2,504,400 $ 4.71 $5.50 - $9.00 1,127,500 4.00 7.83 762,000 7.86 $10.00 - $18.00 562,000 4.31 14.32 330,667 13.38 ----------------------------------------------------------------------------------------------------------------------------------- 5,028,150 4.89 $ 6.44 3,597,067 $ 6.17 ===================================================================================================================================

Outstanding Exercisable ------------------------------------------------------------------------------------------ -------------------------------------- Weighted Weighted Weighted Range of Average Average Average Exercise Number Remaining Exercise Number Exercise Prices Outstanding Life (*) Price Exercisable Price --------------------------- ----------------- ------------------ ------------------- ------------------- ---------------- (unaudited) (unaudited) $3.00 - $5.00 2,677,050 4.85 $ 4.67 2,502,400 $ 4.71 $5.50 - $9.00 1,147,500 3.74 7.79 817,250 7.81 $10.00 - $18.00 562,000 4.07 14.32 330,667 13.38 ----------------------------------------------------------------------------------------------------------------------------------- 4,386,550 4.46 $ 6.72 3,650,317 $ 6.19 ===================================================================================================================================

March 31, December 31, ------------------- -------------------------------------------------------------- 2002 2001 2000 1999 ------------------- -------------------- ---------------- ------------------- (unaudited) Loss before income taxes $ (1,836,969) $ (4,068,759) $ (340,999) $ (2,650,049) ----------------------------------------------------------------------------------------------------------------------------------- Combined basic federal and provincial rates 38.62% 41.75% 43.90% 44.62% ----------------------------------------------------------------------------------------------------------------------------------- Benefit based on statutory income tax rate (709,437) (1,698,707) (149,700) (1,182,450) Decrease in tax benefit resulting from: Losses and temporary differences incurred in the year not tax affected 702,041 1,668,900 124,900 1,182,450 Permanent differences 7,396 29,807 24,800 -- U.S. corporate and minimum tax 16,872 15,685 5,063 9,019 ----------------------------------------------------------------------------------------------------------------------------------- $ 16,872 $ 15,685 $ 5,063 $ 9,019 ===================================================================================================================================

March 31, December 31, --------------------- -------------------------------------------------- 2002 2001 2000 --------------------- ----------------------- ------------------------ (unaudited) Tax benefit of loss carryforwards $ 4,868,760 $4,471,740 $3,189,600 Capital assets 210,768 187,165 94,900 Restructuring charges 281,663 - - Share issue costs 219,197 237,203 268,000 Other 131,510 213,865 - ---------------------------------------------------------------------------------------------------------------------------------- Total future tax asset 5,711,898 5,109,973 3,552,500 Valuation allowance 5,711,898 5,109,973 3,552,500 ---------------------------------------------------------------------------------------------------------------------------------- Future tax asset or liability $ -- $ -- $ -- ==================================================================================================================================

March 31, December 31, ------------------------------------ ------------------------------------------------------- 2002 2001 2001 2000 1999 ------------------ ---------------- ------------------ ------------------- -------------- (unaudited) Accounts receivable $ 247,640 $ (463,316) $ (208,195) $ (2,309,497) $ (250,386) Government assistance receivable -- -- 1,149,779 (1,023,706) -- Prepaid expenses and other receivables 476,202 (168,650) (642,388) (208,810) 79,076 Accounts payable and accrued liabilities (264,090) 119,033 917,887 (1,293,244) 713,230 Accrued restructuring charges 704,158 -- -- -- -- Deferred revenue 6,782 28,248 (242,790) (139,136) 356,464 Restricted cash (Note 4) -- 81,000 -- -- ----------------------------------------------------------------------------------------------------------------------------------- $ 1,170,692 $ (484,685) $ 1,055,293 $ (4,974,393) $ 898,384 ===================================================================================================================================

Three months ended March 31, 2002 ----------------------------------------------------------------------- Core Brokerage Total ---------------------- ---------------------- ---------------------- (unaudited) External revenues Subscription fees $ 2,851,885 $ - $2,851,885 Transaction fees 2,924,155 - 2,924,155 Commissions - 998,369 998,369 Other 309,963 17,229 327,192 --------------------------------------------------------------------------------------------------------------------------------- Total external revenues $ 6,086,003 $1,015,598 $7,101,601 ================================================================================================================================= Operating loss from continuing operations $ (310,992) $ (79,318) $ (390,310) Amortization 488,669 Restructuring charges 842,620 Interest expense 138,151 Interest income (22,781) --------------------------------------------------------------------------------------------------------------------------------- Loss from continuing operations before income taxes $(1,836,969) ================================================================================================================================= Total assets $13,927,055 $1,744,258 $15,671,313 Capital asset expenditures $ 727,556 $ 10,392 $ 737,948

Three months ended March 31, 2001 ----------------------------------------------------------------------- Core Brokerage Total ---------------------- ---------------------- ---------------------- (unaudited) External revenues Subscription fees $ 2,348,316 $ -- $ 2,348,316 Transaction fees 1,861,258 -- 1,861,258 Other 340,508 -- 340,508 ----------------------------------------------------------------------------------------------------------------------------------- Total external revenues $ 4,550,082 $ -- $ 4,550,082 =================================================================================================================================== Operating earnings from continuing operations $ 292,268 $ -- $ 292,268 Amortization 399,602 Interest expense 116,256 Interest income 98,385 ----------------------------------------------------------------------------------------------------------------------------------- Loss from continuing operations before income taxes $ (125,205) =================================================================================================================================== Total assets $19,524,160 $ -- $19,524,160 Capital asset expenditures $ 346,119 $ -- $ 346,119

Year ended December 31, 2001 ----------------------------------------------------------------------- Core Brokerage Total ---------------------- ---------------------- ------------------ (unaudited) External revenues Subscription fees $10,595,561 $ -- $10,595,561 Transaction fees 8,900,156 -- 8,900,156 Commissions -- 3,593,898 3,593,898 Software development and installation 771,996 -- 771,996 Other 519,147 79,313 598,460 ----------------------------------------------------------------------------------------------------------------------------------- Total external revenues $20,786,860 $ 3,673,211 $ 24,460,071 =================================================================================================================================== Operating earnings (loss) from continuing operations $ (933,546) $ 164,704 $ (768,842) Amortization 1,799,338 Write-down of leasehold improvements 153,195 Interest expense 466,048 Interest income (311,965) ----------------------------------------------------------------------------------------------------------------------------------- Loss from continuing operations before income taxes $ (2,875,458) =================================================================================================================================== Total assets $14,628,382 $ 2,822,133 $ 17,450,515 Capital asset expenditures $ 2,670,243 $ 8,862 $ 2,679,105 Goodwill additions $ -- $ 417,973 $ 417,973

2000 1999 Core Core ---------------------- ----------------------- External revenues Subscription fees $ 6,080,239 $ 4,526,458 Transaction fees 3,276,096 643,227 Software development and installation 2,059,348 667,150 Other 535,346 67,264 ----------------------------------------------------------------------------------------------------------------------------------- Total external revenues $ 11,951,029 $ 5,904,099 ----------------------------------------------------------------------------------------------------------------------------------- Operating earnings (loss) from continuing operations $ 1,163,106 $ (2,292,835) Amortization 841,279 219,591 Write-down of leasehold improvements -- 112,500 Interest expense 166,393 25,123 Stock exchange listing costs 525,198 -- Interest income (226,993) -- ----------------------------------------------------------------------------------------------------------------------------------- Loss from continuing operations before income taxes $ (142,771) $ (2,650,049) ----------------------------------------------------------------------------------------------------------------------------------- Total assets $ 15,459,525 $ 2,869,254 Capital asset expenditures $ 3,981,563 $ 582,592 Goodwill additions $ 480,104 $ --

Three Months Ended March 31, 2002 --------------------------------------------------------------------------- Canada United States Total ---------------------- -------------------------- ------------------- (unaudited) External revenues Subscription fees $1,727,659 $1,124,226 $ 2,851,885 Transaction fees 443,163 2,480,992 2,924,155 Commissions -- 998,369 998,369 Software development and installation 26,000 8,755 34,755 Other 176,795 115,642 292,437 ----------------------------------------------------------------------------------------------------------------------------------- Total external revenues $2,373,617 $4,727,984 $ 7,101,601 ----------------------------------------------------------------------------------------------------------------------------------- Total assets $8,124,357 $7,546,956 $15,671,313 ----------------------------------------------------------------------------------------------------------------------------------- Capital assets $3,910,635 $ 986,606 $ 4,897,241 -----------------------------------------------------------------------------------------------------------------------------------

Three Months Ended March 31, 2001 --------------------------------------------------------------------------- Canada United States Total --------------------- -------------------------- ------------------- (unaudited) External revenues Subscription fees $ 1,355,066 $ 993,250 $ 2,348,316 Transaction fees 274,259 1,586,999 1,861,258 Software development and installation 103,347 131,357 234,704 Other 98,579 7,225 105,804 ------------------------------------------------------------------------------------------------------------------------------------ Total external revenues $ 1,831,251 $2,718,831 $ 4,550,082 ------------------------------------------------------------------------------------------------------------------------------------ Total assets $14,709,205 $4,814,955 $19,524,160 ------------------------------------------------------------------------------------------------------------------------------------ Capital assets $ 3,001,268 $ 726,289 $ 3,727,557 ------------------------------------------------------------------------------------------------------------------------------------

Year ended December 31, 2001 --------------------------------------------------------------------------- Canada United States Total ---------------------- ----------------------- ---------------------- External revenues Subscription fees $6,511,498 $ 4,084,063 $10,595,561 Transaction fees 1,336,558 7,563,598 8,900,156 Commissions -- 3,593,898 3,593,898 Software development and installation 446,895 325,101 771,996 Other 489,850 108,610 598,460 ------------------------------------------------------------------------------------------------------------------------------------ Total external revenues $8,784,801 $15,675,270 $24,460,071 ------------------------------------------------------------------------------------------------------------------------------------ Total assets $8,512,615 $ 8,937,900 $17,450,515 ------------------------------------------------------------------------------------------------------------------------------------ Capital assets $3,745,797 $ 902,165 $ 4,647,962 ------------------------------------------------------------------------------------------------------------------------------------ Goodwill additions $ -- $ 417,973 $ 417,973 ------------------------------------------------------------------------------------------------------------------------------------

Year ended December 31, 2000 --------------------------------------------------------------------------- Canada United States Total ---------------------- ----------------------- ---------------------- External revenues Subscription fees $ 3,213,497 $2,866,742 $ 6,080,239 Software development and installation 1,782,546 276,802 2,059,348 Other 523,371 11,975 535,346 ------------------------------------------------------------------------------------------------------------------------------------ Total external revenues $ 5,519,414 $3,155,519 $ 8,674,933 ------------------------------------------------------------------------------------------------------------------------------------ Total assets $11,831,898 $3,627,627 $15,459,525 ------------------------------------------------------------------------------------------------------------------------------------ Capital assets $ 3,112,179 $ 639,003 $ 3,751,182 ------------------------------------------------------------------------------------------------------------------------------------ Goodwill additions $ -- $ 480,104 $ 480,104 ------------------------------------------------------------------------------------------------------------------------------------

Year ended December 31, 1999 --------------------------------------------------------------------------- Canada United States Total ---------------------- ----------------------- ---------------------- External revenues Subscription fees $2,012,436 $2,514,022 $4,526,458 Transaction fees 202,527 440,700 643,227 Software development and installation 415,400 251,750 667,150 Other 50,011 17,253 67,264 ------------------------------------------------------------------------------------------------------------------------------------ Total external revenues $2,680,374 $3,223,725 $5,904,099 ------------------------------------------------------------------------------------------------------------------------------------ Total assets $2,067,073 $ 802,181 $2,869,254 ------------------------------------------------------------------------------------------------------------------------------------ Capital assets $ 958,500 $ 186,698 $1,145,198 ------------------------------------------------------------------------------------------------------------------------------------

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