May 2000

Compiled and written by
Gary Will

E-mail:
gary@garywill.com

Issue 39 -- June 5, 2000
In this digest:

1. LiquiMedia evaporates at Ventures West
2. New CEOs at RDM, Ardesic; prez, CFO at Com Dev, COO at Finline
3. GUARD sells Nanodesign in deal valued at $15 million
4. Descartes closes long-rumoured deal with Ariba
5. Descartes software revenues show strong quarterly growth

6. DSD Solutions becomes Endgame Systems; acquires Arizona company
7. STOCK REPORT: Continued tech sell-off leaves stocks limping
8. Sybase spins off Waterloo-based division as iAnywhere Solutions
9. Com Dev finds life in space; one quarter from profitability
10. Virtek's imaging sales rebound, create quarterly revenue jump

11. Motorola deal closes as CME Telemetrix faces cash depletion
12. Finline annual revenues fall well short of forecasts ... again
13. Miscellaneous tidbits from JPH International, Jedor, Agribiz.com, RDM, Freedom Intelligence, PixStream, Treasury International, Betacom, MapConnects

I've started writing and recording 50-second high-tech profiles for NewsTalk 570 (CKGL-AM) that appear daily in morning and afternoon drive time. There should be a new batch of three profiles every month for the next six months.

And The Record's Technology Spotlight will be back again this year -- a month later than the previous two editions. It's scheduled to be distributed on October 26.

--Gary Will

LiquiMedia evaporates at Ventures West
May 2000

Just three months ago, the Globe & Mail named LiquiMedia one of Waterloo's high-tech "rising stars." At that time, you could find the company listed on the IT portfolio page of venture capital firm Ventures West, which provided a seed round of funding for the company in 1998 (through the Eastern Technology Seed Investment Fund). The bio of Ventures West senior associate Keith Bates highlighted the fact that he was the president and CEO of LiquiMedia.

A lot has changed since then.

A rift between Ventures West and LiquiMedia's founder has put the company on the shelf while the IP sits in limbo. On his personal home page, Rob Kroeger, the UW doctoral student who invented LiquiMedia's core technology and continued to be its chief developer, says he is no longer with the company he started.

LiquiMedia's Web site is gone, e-mail sent to its domain bounces, the phone's been disconnected, and Ventures West has carefully excised references to the company from its Web site. Not only is LiquiMedia no longer listed in VW's current IT portfolio, it's not on the "previous investments" list either. Bates's current bio makes no mention of the company where he served as chief executive for over a year. Even the links to three LiquiMedia news releases from 1999 have been deleted from Ventures West's news archive page.

Keith Bates didn't respond to e-mail asking about LiquiMedia. It seems that Ventures West has chosen to act like the whole thing never happened.

New CEOs at RDM, Ardesic; prez, CFO at Com Dev, COO at Finline
May 2000

A couple of experienced high-tech business managers have taken the reigns at two Waterloo companies. Michael Carr is the new CEO of RDM, succeeding company founder Pat Pavlik who stepped down in November (chairman Tom Di Giacomo had been interim CEO).

Carr was the president of Mark Skapinker's Balisoft from December 1997 until it merged with ServiceSoft in February 1999. Until leaving to join RDM, Carr was overseeing North American operations of Mississauga's Rand Worldwide as regional COO. RDM has granted Carr options to purchase up to 650,000 shares over five years at a price of $2.88 per share.

At start-up Ardesic, the new CEO is Steve Traplin, most recently the sales & marketing VP and co-founder of Nitidus Technology, based initially in Kanata, and previously the VP of strategic alliances at Ottawa's ProMira Software.

Both Nitidus and ProMira were headed by the same CEO, Martin Horne. ProMira was sold to Manugistics in February 1998 for US$71.7 million and a few months later, Horne, Traplin, and two others started Nitidus. Within three months, they had raised $5.5 million in financing, including $2.5 million from Working Ventures, which is the sole shareholder of Waterloo Ventures, the source of Ardesic's seed financing. Earlier this year, Nitidus (or, technically, "certain assets" of Nitidus) was acquired by U.S.-based PTC (Parametric Technology Corp.).

Ardesic's founder, Jeff Fedor, remains president.

I mentioned in the February digest that Com Dev wireless group (now "Com Dev Wireless") president Peter Scovell was on the board of directors of Ottawa's Nu-Wave Photonics. This month, he flipped those two roles, becoming president (and CEO) of Nu-Wave, and taking a seat on Com Dev's board. Succeeding Scovell as president of Com Dev Wireless is Roger Boivin, who was recently hired as the division's sales & marketing VP. Boivin will continue to be based in Com Dev's office in Richardson, Texas.

Tim Zahavich has become the new CFO of Com Dev, succeeding David Belbeck, who wasn't even mentioned in the announcement, despite his many years with the company. The release said Zahavich was "most recently" the CFO of Burlington's Gennum Corp., but he actually left that company over a year ago. Since then, Zahavich was CFO of St. Joseph Corp. of Concord, Ontario. Zahavich had previously been with Gennum for about eight years.

Finline announced this month that Todd Grunberg had become its new COO. Until February, Grunberg was the marketing VP of Tri-Vision International -- the V-Chip company that has been a significant flop despite having Bill and Hillary Clinton mention its product approvingly. Grunberg had been with Tri-Vision for three years. A poster in the StockHouse bulletin board says that Grunberg was a consultant to Finline before joining Tri-Vision.

GUARD sells Nanodesign in deal valued at $15 million
May 9, 2000

GUARD has signed a letter of intent to sell its Nanodesign subsidiary to Montreal's SignalGene. SignalGene [TSE: SGI] will issue 5.7 million shares to Nanodesign's shareholders (GUARD holds 87% of Nanodesign), and pay GUARD an additional $2 million in cash. Nanodesign's shareholders will also receive approximately 1.4 million SignalGene warrants. GUARD says the cash will be enough to maintain operations for at least 12 to 18 months.

SignalGene has agreed to keep all 16 Nanodesign employees and maintain operations in Guelph for at least three years. Ian Anderson will continue as Nanodesign's CEO and will also join SignalGene's board. Jonathan Schmidt, inventor of Nanodesign's technology, will become SignalGene's VP of drug design.

At March 31, Nanodesign's accumulated deficit shown on GUARD's books was $7.5 million. GUARD's market cap at the end of May stood at $10.8 million -- less than GUARD's share of the announced value of the Nanodesign transaction.

The sale came just as Nanodesign reported its first revenues since the company was created in 1997 (it had been a GUARD-funded research project since 1995). In the quarter ended March 31, the company reported a net loss of $556,000 on revenues of $73,000. Those revenues were also the first for GUARD (excluding interest), which reported a net loss of $1.0 million ($0.15/share) on revenues of $89,000 for the three months ended March 31 (Q1 00).

Despite the fact the GUARD shares had lost 60% of their value in the last year, the Nanodesign sale (expected to close later this month) made the atmosphere at this year's AGM much more hopeful than was the case a year ago. Chairman George Masters and CEO Brian Cox both made references to GUARD "running on fumes" as its cash position dwindled toward zero as the year came to a close "Limping along from payroll to payroll" was how Masters described the situation, while Cox said they'd "had a pretty difficult year."

Cox praised the unnamed directors who put in $270,000 through a private placement (albeit as a significant discount to the market price -- 24% at the time the transaction was announced on May 10) to keep the company afloat. The $300,000 promissory note I mentioned in the last digest was a loan from the University of Guelph.

GUARD told its shareholders that it intends to distribute about 1.7 million shares of SignalGene to them (about one SignalGene share for ever four GUARD shares held) at some point after the 180 day escrow period ends.

When a shareholder asked if GUARD's desperate cash situation might have led them to accept a weak offer for Nanodesign, Masters replied that before the SignalGene offer came in, GUARD's board was ready to grudgingly accept a deal with a VC that would have valued Nanodesign at only $7 million. He said that three or four months ago GUARD was "being kicked by everybody" in its negotiations and he seemed particularly happy that no one would again be able to say that GUARD had no track record in successfully spinning out companies.

Management said it is looking forward to being able to develop its other properties, particularly Elite Display Systems, now positioned as "a display technology company." The other subsidiary companies are Magnos Technologies and the newly incorporated Integragen.

Descartes closes long-rumoured deal with Ariba
May 23, 2000

After months of rumours, Descartes announced a major deal with California's Ariba, one of the top B2B online exchanges. Ariba, which brings together buyers and sellers in a broad range of industries, will offer a new Web service called "Ariba Logistics and Fulfillment Services, Powered by Descartes" that will link the trading partners on the Ariba B2B Commerce Platform with the logistics providers on Descartes' Global Logistics Network.

Ariba CEO Keith Krach said the alliance "will significantly advance the state-of-the-art of business-to-business electronic commerce."

Financial terms were not disclosed, but the two companies will share transaction-based revenues generated by the new service.

Ariba has a market cap of about US$17 billion (roughly 13 times larger than Descartes'). The deal with Ariba is non-exclusive so, in theory at least, Descartes could still sign a similar deal with Commerce One, Ariba's main competitor, and other B2B exchanges.

Descartes software revenues show strong quarterly growth
May 24, 2000

For the quarter ended April 30 (Q1 01), Descartes Systems Group reports revenues of US$13.4 million, up 21% from the same period last year and 11% sequentially. Software sales, now labeled "license and network" revenues to reflect the growing significance of ongoing transaction-based revenues, were up 34% from the previous quarter to US$8.8 million or 65% of sales (up from 54% in Q4 and 33% a year ago).

Net loss was US$23.5 million (US$0.56/share), but excluding amortization and one-time IPRD charges from the E-Transport acquisition, the loss was US$2.7 million (US$0.06/share).

Excluding revenues from the DSD segment that was just spun out into DSD Solutions, Descartes' license and network revenues for the quarter were US$8.2 million, up 382% from a year ago and 44% from last quarter. The company has said that by fiscal year-end, nearly half of its L&N revenues will be transaction-based but CEO Peter Schwartz said in the conference call that for now Descartes will not disclose its transaction revenues so it can "keep the competition slightly off base." He characterized the current level of transaction revenues as "significant" and said the company now has more than 150 customers paying transaction fees.

Despite the significant shift in the revenue mix toward software, gross margins were flat from the previous quarter. The balance sheet shows US$60.5 million in cash, which includes US$9 million from DSD Solutions.

Schwartz said that one of Descartes' advantages will be that it has established a true service-based business with consistent pricing for transactions, unlike many competitors who use different fee schedules for each deal, essentially recasting their traditional license fees as network tariffs.

Descartes just released its 2000 annual report but I haven't had the chance to read it yet. The information circular shows that two executives received 48% of the stock options granted to employees over the year. One of the two, EVP Pierre Donaldson, left Descartes in March, less than two years after joining the company from Oracle (at year-end, his unexercised options were valued at US$10.5 million).

At this year's AGM (which will be held at the Design Exchange in Toronto -- site of the last two MKS AGMs), the company will ask shareholders to allocate more shares to the stock option plan -- as it successfully did two years ago. The proposed plan would set the number of shares reserved for options at 8.655 million, or 20% of the outstanding shares. Under the current plan, 6 million shares are reserved for options, of which 3.7 million have been issued -- over half of them to the company's five highest paid executive officers at year-end.

Peter Schwartz did not receive any options in fiscal 2000. The circular reports that he waived 23,000 options in August "in favour of other employees." He is shown as owning 926,000 shares (about 2% of the company), down from 1.16 million a year ago and 1.31 million two years ago.

Steven Spicer, CEO of Spicer Corp., is not standing for re-election to the board of directors this year. He had been a Descartes director since 1996.

DSD Solutions becomes Endgame Systems; acquires Arizona company
May 25 & June 1, 2000

Descartes spin-off DSD Solutions has already been given a new name: Endgame Systems Inc. (www.endgamesystems.com). The company also announced that is has acquired Vendmaster Software Systems of Scottsdale, Arizona. Vendmaster is a seven year-old company that has developed a Windows-based vending management product.

Endgame's Web site lists the specific product groups (and related customers) that it has acquired from Descartes: sales & distribution management systems, scan based trading, data warehousing, load optimizer, mobile merchandiser, mobile sales force automation, and mobile route sales.

STOCK REPORT: Continued tech sell-off leaves stocks limping
May 2000

The first two days of trading in June have brought a welcomed rally for tech stocks, but the sell-off continued into its third month in May. MKS was hit particularly hard for no apparent reason, but it's already made back most of those losses this month.

Stock price changes for May, with the change over the last three months shown in parentheses:

MKS [TSE: MKX] -35% (-52%)
RIM [TSE: RIM] -23% (-76%)
Open Text [TSE: OTC] -23% (-58%)
Descartes [TSE: DSG] -19% (-47%)
Finline [CDNX: FIN] -15% (-68%)
COM DEV [TSE: CDV] -13% (-49%)
Gensel Biotech [CDNX: GSB] -11% (-28%)
RDM [CDNX: RC] -10% (+5%)
Virtek [TSE: VRK] -8% (-41%)
DALSA [TSE: DSA] +1% (+20%)
CME Telemetrix [CDN: CMET] +8% (+10%)
GUARD [CDNX: GUA] +17% (+105%)

DALSA's stock split bumped the shares to their highest levels in two years. They had fallen off a bit from the intra-month high by month-end but remain near the top of their 52-week range.

Sybase spins off Waterloo-based division as iAnywhere Solutions
May 17, 2000

Sybase's mobile & embedded computing division, which has evolved out of UW spin-off Watcom, is now the core of a new company called iAnywhere Solutions. iAnywhere, a wholly-owned subsidiary of Sybase, is headquartered in Waterloo and led by president Terry Stepien. Stepien will continue to report to Sybase CEO John Chen.

iAnywhere is expected to add 50 new jobs in Waterloo this year to its current staffing levels of over 200. Sybase will invest US$2 million to expand the Waterloo facility.

The company's mandate is to become the leading provider of mobile and wireless e-business products and services. As a division of Sybase, the company had sales in 1999 of $113.3 million, which would have placed it second (behind Open Text) among Waterloo software companies.

Com Dev finds life in space; one quarter from profitability
June 1, 2000

In Q2 00, ended April 30, Com Dev reports revenues of $44.9 million, up 7% from the previous quarter and 8% from a year ago. Net loss was $2.0 million ($0.05/share), down from $3.9 million in the previous quarter.

For the first time in over a year, Com Dev's space group (now "Com Dev Space") showed a sequential increase in revenues, jumping 38% from the previous quarter to $21.5 million. Space revenues are still down 11% from a year ago, but the order backlog doubled over the quarter to $90 million -- its highest levels since 1997. Division president John Keating forecast that revenues would continue to increase and said that its market "has completely turned around."

On the wireless side, revenues were off 11% from the previous quarter, which the company said was "nothing to be concerned about." Wireless sales were up 36% from the same quarter a year ago.

During the conference call, Com Dev CEO Keith Ainsworth said that the company will show a profit in the current quarter -- its first since Q2 98 -- and that it is preparing for a "full-scale assault" on the wireless broadband Internet access market. Com Dev expects to achieve around 25% growth in sales next year (higher in Wireless) with an annual profit of around $20 million.

With the proceeds from the recent rights offering, Com Dev has gone from a net bank indebtedness of $7.2 million to net cash of $1.5 million. The current portion of loans payable was also decreased substantially, although there was an additional $4.4 million in long-term indebtedness added during the quarter. Working capital is $41.1 million.

Virtek's imaging sales rebound, create quarterly revenue jump
June 1, 2000

For the quarter ended April 30 (Q1 01), Virtek reports total sales of $5.5 million, up 59% from the previous year and 14% sequentially.

Any concerns about the sharp decline in revenues from Virtek's imaging unit in the last quarter were erased with these results. All of the quarter-over-quarter gains came from the increased sales of imaging products, up 125% from a weak Q4 to $2.0 million. Imaging contributed 36% of revenues in the quarter -- double what it provided the previous quarter. CEO Jim Crocker says the company expects its strongest growth will come from imaging products, particularly ChipReader.

The templating business unit contributed the other 64% of sales -- $3.5 million, down 11% from the previous quarter but up 27% from the same period a year ago (a period prior to two acquisitions which closed in Q4).

The balance sheet shows net bank indebtedness of $536,000. Virtek's cash position should be helped greatly by the share offering for which it filed a preliminary prospectus two months ago. Working capital is $3.7 million.

Inventory levels and accounts receivable both jumped significantly, which the company says was due to high sales levels at the end of the quarter and the ramp-up in sales of ChipReader.

Net income was $478,000 ($0.03/share), much lower than the previous quarter because the company has now joined the ranks of the taxpayers. On an EBITDA basis, earnings were down about 7.5% from Q4.

Quarter-over-quarter, there were large jumps in G&A expenses (+32%) and sales & marketing spending (+21%) while R&D costs fell by 23%. Overall, expenses climbed 18% from the previous quarter.

Virtek's 2000 annual report has the theme "It's not only rocket science." Last year's theme was "Do something great," an exhortation which Crocker says the company and its employees lived up to over the year.

Four of the seven senior managers from a year ago who were not listed among the company's "key employees" in the prospectus (mentioned in the e-mail version of the last digest) are still with the company and listed in the annual report. Warrick Wilson, formerly Virtek's engineering manager, is now in a similar position with Waterloo's Fred Systems.

Earlier in May, Virtek announced that it had signed a three-year deal that will see that its ChipReader technology used by the Ontario Cancer Institute at Toronto's Princess Margaret Hospital.

Motorola deal closes as CME Telemetrix faces cash depletion
May 30, 2000

Just as CME Telemetrix warned its investors that it was expecting cash resources to be depleted in the current quarter, the company received $3.0 million from the completion of its licensing deal with Motorola (see February digest for details).

Motorola has acquired a 5% stake in CME, priced at $7 per share (CME shares finished May at $13.50). In return, Motorola receives an exclusive worldwide (excluding Japan) license for CME's non-invasive medical devices, including the blood glucose monitor currently under development. CME would receive royalties on all sales of its technology.

Motorola also has the option -- exercisable until mid-January -- to invest an additional $2.2 million (also at $7/share) and receive warrants that could net CME another $3.1 million (again at $7/share) if all warrants are exercised before their May 15, 2003 expiry date.

CME's cash crunch came from the continued refusal of Neurosoft to pay any additional money for Advantage Medical (see January digest), which it purchased from CME in 1999.

At the time of the sale, the deal was announced as worth $5 million, although the actual terms were $5 million spread over two years minus unspecified "adjustments." CME has just disclosed that the adjustments are expected to be about $514,000, resulting in an actual selling price of about $4.5 million over two years. Neurosoft has paid CME $2.5 million but is refusing to pay further installments. It has withheld the $836,000 payment CME was expecting to receive in April.

Despite the threat of cash depletion, CME's information circular shows that CEO Duncan MacIntyre was well-compensated in his first full year with the company. In addition to his salary of $250,000, MacIntyre received bonuses totalling $231,200 ($100,000 of which came from the sale of Advantage Medical, which was to be paid if the selling price was at least $5 million) and total compensation of $481,702. He also had 87,500 options vest at an exercise price of $2.25.

In the annual report, MacIntyre sets out the priorities for this year as 1) reducing prediction errors to a level comparable to store-bought invasive devices, 2) increased miniaturization (with an ultimate goal of a handheld device), 3) additional licensing agreements, and 4) improvement of general business operations.

There was no update provided on the letter of intent signed with the Photonics Center at Boston University -- announced nearly nine months ago.

For the quarter ended March 31 (Q1 00), CME reports a net loss of $467,000 ($0.06/share) on revenues of $261,000. Accumulated deficit is now $7.8 million. Revenue was down 37% from the previous quarter. The balance sheet, pre-Motorola, showed $624,000 in cash and short-term investments. In 1999, operations consumed $2.7 million in cash.

CME also announced in May that is has qualified for ISO 9001 accreditation.

Finline annual revenues fall well short of forecasts ... again
May 10, 2000

Finline reports that its 1999 revenues (December 31 year-end) were $445,000 -- down 28% from 1998. It is the third time in the last four years that the company's annual sales have declined.

Net loss was $393,000 ($0.06/share), lessened by a 54% chop in operating expenses from the previous year, including an 85% reduction in sales & marketing spending. (The apparently-unvetted MD&A in the company's annual report says that "operating expenses decreased by 118%" That would be quite a trick.)

Last July, Finline's director of corporate development told The Record that the company would ship $1.5 million in equipment by the end of the year under its contract with Richardson Electronics, "with a possible upside." As it turned out, total sales to all U.S. customers in 1999 was just $176,000.

A year ago, Finline said it expected to receive US$11 million over two years through the Richardson contract (initially announced in 1998 as worth US$24 million over three years).

Finline also reported its Q1 numbers this month, showing sales of $160,000, down 29% from the same period last year and 13% sequentially. Net loss for the quarter was $163,000. Both sales & marketing (+316%) and general & administrative (+178%) expenses were up dramatically from the same period last year.

With the infusion of $3 million from a private placement, the balance sheet is looking better than ever with $2.1 million in cash and working capital of $2.0 million. Most of the loans from shareholders -- some of which were collecting 30% annual interest -- have been repaid, as has the company's long-term debt.

Among the nominees for Finline's board is Paul Grespan, partner in the Kitchener law firm McCarter Grespan Robson Beynon Thompson. Like just about every local tech company, Finline will be seeking shareholder approval for a new stock option plan at this year's AGM.

Finline's largest shareholder remains founder and CEO Einar Fiskvatn with a stake of nearly 15%.

Next month, Finline is scheduled to be in New Orleans as an exhibitor at WCA 2000, the wireless broadband trade show of the Wireless Communication Association.

Miscellaneous Tidbits

• More than 20 people have been laid off at JPH International, which has been having a rough time over the last few months. The firm Geller, Shedletsky & Weiss has been hired to help those laid off find new jobs, and it has set up a special Web page with capsule profiles of laid-off JPH employees.

• Sonic Foundry disclosed in its securities commission filings that it paid US$150,000 cash for Jedor (see January's digest) plus 9,900 Sonic Foundry shares valued at the time of the deal at US$300,000. To be eligible to receive all shares, the three Jedor principals will have to remain Sonic Foundry employees for three years. None of the shares can be sold for three years. If Sonic Foundry moves Jedor's offices to a location outside Canada, all the shares vest immediately. Each of the three also received options to purchase 5,000 Sonic Foundry shares.

• Guelph's Agribiz.com, sister company of TDG Interactive, has merged with Colorado's Limelight Technologies. Both companies are investees of Rabobank and members of Rabobank's vTraction.com agri-business eCo-op. Grant Robinson, CEO of Agribiz.com/TDG will remain CEO of the combined company. Two months ago, Guelph's eHarvest.com, a company affiliated with Agribiz.com, merged with its U.S. rival Farms.com, another Rabobank investment.

• RDM has formally launched Xign Inc., its U.S.-based subsidiary that will develop and market RDM's technology that evolved out of the eCheck initiative. The release says that CVF Corp. has "introduced Xign to two U.S.-based investment bankers to assist in obtaining financing and strategic partners."

• Freedom Intelligence's query server has been implemented by Britain's 192.com Web directory. The Web site centres on database queries and is produced by the same company that has created a stir by publishing CDs with compilations of personal information on Britain citizens (including one focusing on company directors).

• PixStream has opened an office in Oslo, Norway that will provide sales and support for Northern Europe. PixStream opened a UK office last summer. The company also announced that Britain's Kingston Vision has started rolling out its video services over ADSL lines using PixStream technology.

• Kitchener's Treasury International (parent company of Compelis) announced yet another new subsidiary in May, this one called WebCo-ops.com Inc. The company will develop online trading co-ops in various vertical markets. According to TI's annual report, the company has 16 full-time employees, including nine developers and four sales reps. It says that sales for Compelis increased by 148% for the year ended January 31 and the company's overall revenue from operations for the year was US$363,000.

• Betacom, the former Control Advancements, now based in Mississauga, has formally opened what it calls a "technology transfer facility" in Waterloo. It says the site will be staffed by a "complete development team." The company lost a lot of local engineering expertise this year as it pared down its activities to the senior and disabled markets. Its former engineering subsidiary, Alliance Technologies, was wound down earlier this year and Alliance CEO Tom Ulmer and its president Kevin Tuer both left the company, as did most Alliance engineers. Alliance isn't mentioned anywhere in Control Advancements/Betacom's new annual report. Neither is Jeffrey Preitauer, who was CEO of the company for 10 months of the fiscal year. The report does show that the company still owns significant stakes in Ventax Robotics (38%) and Dantec (23%), both of which it expects to sell off this year. Lawyer Christopher Freeman, who is director and secretary of Betacom, fills the same roles at CME Telemetrix. Graham Strong, director of UW's School of Optometry, holds a 3.4% stake in Betacom.

• Mikael Prydz, the former president, CEO, and director of Guelph's RecycleNet Corp., has been given a 15-year ban by the Ontario Securities Commission on serving as a director or officer of any company listed as an issuer by the OSC (see March digest for details of the OSC's charges against Prydz). The OSC also held that Prydz showed a disregard for the securities laws of Ontario and disrespect for the OSC.

• Old news I missed: The deal between Waterloo's MapConnects and Toronto's Altai Technologies (see June 1999 digest) was completed in January. The two companies have equal control of a new company called Mapcheck Inc. Altai contributed $2 million for its stake, while MapConnects transferred ownership of its map-based database technology to the new company. Techvest 1 of Toronto has received non-voting shares giving it a 12.5% stake in Mapcheck, with Altai and MapConnects equally splitting the remaining shares. MapConnect CEO Fred McGarry has become CEO of Mapcheck. A demo of the Mapcheck technology, using Waterloo as its source, is online. Mapcheck hopes to license its technology to radio stations and other media outlets who would use it to create local information portals while providing content and selling advertising.