February 2002

Compiled and written by
Gary Will

E-mail:
gary@garywill.com

Issue 60 -- March 4, 2002
In this digest:

1. Feldgajer sues VoiceIQ; company closes Waterloo operations
2. QJunction shut down by investors three months after relaunch
3. ARISE plans to go public with $1-3M IPO
4. Descartes ends year with US$59M loss; losses to continue
5. Descartes adds second CEO

6. Dspfactory raises additional $5M; brings total raised to $21M
7. IBM plans Waterloo research centre; takes over Manulife IT ops
8. CheckFree writes down BlueGill assets by US$107M
9. Open Text anticipates "significant profit" from Accelio holdings
10. Virtek stops biotech instrument development; lays off 17

11. Com Dev sales slip on UK problems; records first M/ERGY revenue
12. Endgame becomes Global Beverage Group; adds U.S. operations
13. MKS gets closer to break-even levels
14. STOCK REPORT: Descartes, Virtek lose a quarter of their value
15. CME Telemetrix claims patent infringement by U.S. competitor

16. Miscellaneous tidbits from Avvida Systems, Covarity, EMJ, Biorem, 3C Infotech, RIM, PrinterOn, Turbosonic, Cyberplex, Finline.

Feldgajer sues VoiceIQ; company closes Waterloo operations
January 28 and February 27, 2002

Oleg Feldgajer -- founder of International Neural Machines -- is suing VoiceIQ, the company that acquired his business last May. According to VoiceIQ, Feldgajer and "another former officer of INM" -- most likely Feldgajer's wife, Marg Feldgajer -- are suing the company for $6 million, claiming breach of contract or wrongful dismissal. VoiceIQ says it terminated the employment contracts of the two in January.

VoiceIQ also confirmed that it has shut down the Waterloo development office it took over with its acquisition of INM. It says some remaining employees (most were fired in January) will relocate to its Markham headquarters and have held out the possibility of the company relocating in a couple months to a site that would be a shorter commute from Waterloo.

Feldgajer's termination is particularly interesting since he was VoiceIQ's largest shareholder and one of the company's directors. He is no longer on the board. Oleg Feldgajer was president and CEO of INM when it was acquired by VoiceIQ; Marg Feldgajer was VP of operations. The only other officer of INM was COO Gideon Vardi.

VoiceIQ -- then known as BCB Voice Systems -- first took a significant stake in INM in April 2000 when it bought equity and debt held by Working Ventures Canadian Fund, which had invested in INM in 1997. It acquired the remaining 63.5% of the company in May 2001 in an all-stock deal valued at the time at about $4 million. By the end of the year, those shares had fallen to a value of $475,000. The company's shares are currently suspended by the CDNX.

For the year ended September 30 (which the company just got around to reporting last week), VoiceIQ lost $16.2 million on sales of $4.6 million. The loss included a $5.8 million write-down of goodwill related to INM. Sales were down 36% from 2000.

VoiceIQ says that since it bought INM, "none of the INM technology has been commercialized and none of the potential revenue sources that INM has been pursuing has been realized."

INM was founded in 1990 by Feldgajer while he was working for NCR in Waterloo.

QJunction shut down by investors three months after relaunch
February 19, 2002

QJunction, known as Qfonix Inc. in its latest incarnation, has ceased operations again. Investors pulled the plug on the company just three months after it was reorganized and relaunched following a lengthy dispute with start- up CEO Victor Lee.

When QJunction re-started in November, it brought back many of the developers it had laid off only a few months earlier. It also recruited a new CEO in Michael Geraghty, most recently executive VP with Mississauga's AutoBranch Technologies and previously an executive at Clarica.

The company's investors and board of directors included Val O'Donovan and Doug Wright, the chancellor and president emeritus of UW, respectively.

The shut-down came one day before Qfonix was scheduled to give a presentation to potential investors at the Technology Investor Forum in Kitchener. According to information given to the forum's attendees, Qfonix was seeking $6-8 million and was forecasting sales of $65 million in three years. Both of those figures seem way too high for a company at Qfonix's stage (for comparison, Virtek and MKS combined will have sales of about $75 million this year). And while unrealistic forecasts would hardly have made the company unique among presenters at a VC forum, they may have contributed to the anxieties of existing investors.

Co-founding professors Otman Basir (UofG) and Fakhri Karray (UW) -- who are also the founders of Waterloo's Intelligent Mechatronic Systems -- are hopeful that they can once again collect what remains of the company and start again.

ARISE plans to go public with $1-3M IPO
February 13, 2002

ARISE Technologies, a provider of solar energy technology, has filed a preliminary prospectus for an IPO which would raise between $1-3 million. The pricing of the offering has not been set.

The company is not yet making a profit and doesn't expect to become profitable soon. It logged a net loss of $281,000 on sales of $308,000 in the seven months ended December 31, 2001. In the previous 12 months, it lost $696,000 on sales of $345,000. Sales in the full calendar year 2001 were $495,000, of which 78% came through the company's Web site, SolarSense.com.

ARISE says it expects to expand revenue rapidly this year following the acquisition of a distribution company in January (no financial details of the acquisition are provided in the prospectus, but the acquired assets are carried on ARISE's books with a value of $20,000).

Accumulated deficit at the end of 2001 was $2.3 million and the company's book value was $243,000 at that time. Working capital at year-end was $264,000 with $89,000 in cash. ARISE says it will need additional cash infusions to continue operations until it receives the IPO funds.

ARISE founder Ian MacLellan became interested in solar power while operating Creation Venture Capital Corp. in Vancouver. He incorporated CVCC Holdings Inc. in 1993 and changed its name to ARISE Technologies Corp. in 1997. In the fall of that year, the company set up an office on Phillip Street and stayed near UW until relocating to a 10,000 square-foot facility in Kitchener last June.

Ian and Cathy MacLellan currently own 35.5% of ARISE and are the company's largest shareholders. The second-largest shareholder is something called DeVijver B.V., which owns 11.3%. Chairman Hal Merwald, who is executive director of Christian mission Young Life of Canada, holds 6.1% of ARISE. DeVijver's nominee to ARISE's board, Vern Heinrichs, is a director of Young Life of Canada (he was also lead donor to UofT's peace and conflict studies chair, which I wouldn't have thought twice about except for The Record's report on Saturday that RIM co-CEO Jim Balsillie is working to establish a peace research institute at what is now the office of Waterloo Maple in the former Seagram Museum. RIM and ARISE had a little conflict of their own last year when RIM kicked ARISE out of the office space it had been leasing in a RIM-owned building). CFO Michael Ben currently holds a 5.4% stake in ARISE.

Also on ARISE's board is Alan Winter, the former president of Com Dev Space. As of December 31, ARISE had 10 full-time and 4 part-time employees.

In the summer, Sunshine Capital Corp. -- a CDNX-listed capital pool company -- said that there was "a high probability" that it would reach an agreement to acquire ARISE for an estimated purchase price of $5 million. Just after Sunshine completed its IPO, it announced that the deal with ARISE was dead.

Descartes ends year with US$59M loss; losses to continue
February 26, 2002

In the 2002 fiscal year, ended January 31, Descartes reported a loss of US$58.7 million on revenue of US$79.5 million. Revenue climbed 19% from fiscal 2001. At the beginning of the year, the company was forecasting sales of US$115-120 million for the year, and were sticking to that number as recently as June, before the wheels fell off on its licensing revenue over the summer.

Initially, Descartes forecast that its licensing revenue would climb by 120- 140% in fiscal 2002 to US$71-78 million. In the end, it actually decreased slightly to US$32.2 million. The dearth of licensing revenue prompted Descartes to announce what it is calling its new pricing model -- the abolition of up-front network access fees and a full transition to subscription and transaction fees.

Those fees, which Descartes has called network revenue for the last year and is now relabelling as "recurring network revenue," grew to US$35.1 million in fiscal 2002, outpacing the company's forecasts of US$30-32 million a year ago.

If you ignore the tens of millions of dollars Descartes spent on acquisitions, the nearly US$10 million it invested and never expects to see again, the millions of dollars in expenses from laying off employees and restructuring operations, the millions in sales that it doesn't expect it will collect, and one or two other categories of costs, you arrive at the number that Descartes would like to emphasize -- an "adjusted" loss of only US$3.3 million (US$0.07/share) for the year.

Fourth quarter revenue of US$18.1 million was flat versus Q3 and down 14% from the same period a year ago. Network revenue grew 4% sequentially to US$9.4 million. Gross margins continued to slide, falling to just under 60% in Q4. The company attributed the drop to a change in product mix toward lower margin network revenue. Net loss in the quarter was US$11.2 million.

Excluding amortization of intangibles, amortization of deferred compensation, and an extraordinary gain on redemption of convertible debentures, adjusted loss was US$2.7 million (US$0.05/share) -- in line with the company's forecast and the consensus estimate, although Descartes chose not to exclude its gain from CDs and reported an adjusted loss of US$0.04/share, prompting reports of "beating the street" by a penny. (And if a dispute over the categorization of US$352,000 in a quarter where the company lost US$11.2 million seems like a trivial matter, then welcome to the world of investor relations.)

Descartes ended the year with a strong balance sheet (we'll let pass how it got that way), including US$201.0 million in cash and marketable securities and net working capital of US$129.4 million. The company used US$10.2 million in cash over the quarter, including the US$2.5 million it paid for 70% of Sweden's Tradevision AB.

At the end of the year, Descartes had 636 employees, including 44 it picked up through the Tradevision acquisition.

For the current fiscal year, Descartes is forecasting revenue of US$85-90 million -- a top-line growth rate of 7-13%. That forecast is based on the assumption that the company closes one or two acquisitions during the year. It expects an adjusted loss between US$0.14-0.16/share or about US$0.18- 0.20/share if you exclude projected gains from the repurchase of convertible debentures. A year ago, Descartes forecast an adjusted profit of US$0.39/share for fiscal 2002.

Network revenue, now classified as recurring network revenue, is expected to grow from US$35 million to around US$50 million, with all of those gains offset by a reduction in network-related licensing and services revenue, which is now categorized as non-recurring network revenue.

Descartes adds second CEO
February 26, 2002

Another executive shuffle at Descartes has resulted in Peter Schwartz sharing the CEO title with newcomer Manuel Pietra who also becomes company president.

Before joining Descartes, Pietra, also known as Manuel Schiappa Pietra, had been founder and managing partner of Numbers@Work, a consulting firm based in the Miami area. He was previously an executive with Baan and its Baan Americas division. He had been working with Descartes as an advisor for four months before being appointed co-CEO. According to the Descartes release, Schwartz has known Pietra for five years.

Pietra takes over responsibility for day-to-day operations, while Schwartz will focus on corporate strategy. Willem Galle, appointed president of Descartes six months ago, becomes the company's vice-chairman.

Schwartz became CEO of Descartes in November 1995 (Descartes' news release said 1997 which is actually when he became chairman -- a position he still holds).

Dspfactory raises additional $5M; brings total raised to $21M
February 2002

Dspfactory announced that it recently raised an additional $5 million through the sale of convertible debentures. Investors were Val O'Donovan (Dspfactory CEO Robert Tong is a former Com Dev VP) and Mike Stork (the former chairman of Unitron, which spun off Dspfactory in 1998). Both had participated in earlier rounds of financing.

The company has now raised $20.9 million over the last two years -- $12.7 million in 2001 and $8.2 million in 2000. It made a presentation at the Technology Investor Forum in February looking for an additional $10 million. It says its sales have grown from $1.6 million to $16 million over the last year and is forecasting sales of $60 million in three years and $100 million in five years.

Reg Peterson, who sold the nursing home business of Versa-Care in 1997 for a reported $220 million, is also listed as one of the company's investors.

IBM plans Waterloo research centre; takes over Manulife IT ops
February 11, 2002

Insurance, high-tech, and academia are Waterloo's three most prominent sectors and IBM plans to become a key part of all three with two deals it announced in February.

It has signed a memorandum of understanding to manage the IT infrastructure and operations of Manulife and announced the creation of an insurance research centre at the University of Waterloo. At least that's where IBM said it will be; UW didn't participate in the announcement. A second release from IBM just said the centre would be in Kitchener-Waterloo. The north campus research park would seem to be a natural location for the centre, but nothing has been announced yet.

IBM says it is working with UW on "research and projects specifically focused on early adoption of innovative insurance software solutions on IBM software platforms."

About 400 Manulife IT employees in Waterloo, Kitchener, and Toronto will be transferred to IBM. Manulife also agreed to participate in the research centre.

One of the other companies that IBM says will be involved is Castek, which last year acquired InsuroCity.com from Waterloo's Vital Innovations.

CheckFree writes down BlueGill assets by US$107M
February 2002

CheckFree, which acquired BlueGill Technologies in April 2000 in a stock swap valued at US$250 million, has written down the value of its BlueGill assets by US$107.4 million. BlueGill, renamed CheckFree i-Solutions after the acquisition, has seen its sales decline in both of the last two quarters.

"Sales of our i-Solutions electronic billing and statement software have continued to fall below expectations," the company said. "When sales declined again in the quarter ended December 31, 2001, we re-evaluated our long-term expectations."

i-Solutions has introduced a hosted billing service and says customers "are beginning to show interest" in it, but software sales remain slower than expected.

The US$250 million in CheckFree stock that BlueGill shareholders received would currently have a value of US$66 million.

Open Text anticipates "significant profit" from Accelio holdings
February 6, 2002

In the quarter ended December 31 (Q2 02), Open Text earned US$3.4 million (US$0.16/share) on revenue of US$39.2 million. Sales were up 11% from the previous quarter and 4% from a year ago. Much of the increase came from services, up 28% sequentially to US$11.1 million. The jump was due to training revenue collected during Open Text's LiveLinkUp user conference, held in November.

CFO Alan Hoverd says the company stands to earn a "significant profit" in the current quarter if Accelio shareholders accept Adobe's bid for the company (see previous digest). After all of the wrangling over Accelio in previous months, no one on Open Text's conference call who discussed the matter even knew how to pronounce the company's name.

Excluding amortization of intangibles, adjusted net income for the quarter was US$5.1 million. The company says its cash flow from operations was US$6.0 million, up from US$3.9 million in Q1. Over the first half of the year, sales are up 10% from fiscal 2001.

At quarter-end, Open Text had US$91.2 million in cash and equivalents, up US$7.0 million over the quarter.

Seven deals for the new MeetingZone application were closed over the quarter, although total revenue from the product was not yet significant.

Open Text had about 1,100 employees worldwide, down slightly over the quarter after some smaller offices were closed.

Virtek stops biotech instrument development; lays off 17
February 18, 2002

Virtek has pulled the plug on its development of biotech instruments and is cutting expenses in its Virtek Biotech division in an effort to return the company to profitability.

The company has chopped 17 positions and one of those departing is Phil Nafekh, who had been Virtek's CFO until becoming president of Virtek Biotech last year.

Virtek expanded into the biotech market three years ago this month with the launch of its ChipReader product. It added complementary products through the acquisition of the biotechnology business of Engineering Services Inc. (ESI) in July 2000. All of the products had some success in the marketplace, but Virtek was never able to commit the resources needed to compete fully with established biotech companies. Two distribution partnerships both proved to be flops, and Virtek says it is looking for a new partner to sell the existing instruments.

Virtek's investment in Virtek Proteomics Inc. -- created just four months ago as a partnership with researchers at UofT -- will be limited to commitments that have already been made, which continue for another four months.

In its release, Virtek said that development of its FONA biosensor will continue and be strengthened with the addition of engineering resources and an experienced biotech executive.

The company, which has lost nearly $3 million over the last two quarters, had already implemented layoffs and salary cuts to bring costs down. It expects to return to profitability in 2-4 quarters and is forecasting positive cash flow "almost immediately."

Com Dev sales slip on UK problems; records first M/ERGY revenues
February 27, 2002

For the quarter ended January 31 (Q1 02), Com Dev reported revenue of $28.2 million and a net loss of $7.4 million ($0.16/share). Sales were flat versus a year ago, but down 13% from the previous quarter.

Com Dev Broadband -- the new name for the M/ERGY division -- contributed $2.7 million in revenue from the sale of a trial network to Korea's SK Telecom. It was the first revenue from Com Dev's new M/ERGY wireless Internet product.

Com Dev Space revenue fell to $25.5 million, down 22% sequentially. The company attributed the drop in part to problems at its UK facility. It says the problems have been fixed. Com Dev is forecasting no revenue growth from its space division this year.

During the quarter, the company netted $16.9 million in cash from the sale of convertible debentures and another $15.6 million from the sale of its wireless assets to Mitec. Com Dev paid off $15 million in bank debt and added $17.4 million to its net cash position, raising it to $24.3 million at quarter-end.

Other than the trial network to SK Telecom, there have been no sales of the M/ERGY product, which Com Dev says is on schedule for commercial availability this month. Gross profits on the sale to SK were around $250,000, while M/ERGY racked up another $7.8 million in expenses over the quarter.

Com Dev also announced in February that it is co-funding the NSERC-Com Dev industrial research chair in filter and switch technologies at the University of Waterloo's electrical and computer engineering department. NSERC will contribute $1 million over five years, while Com Dev will contribute $850,000 in cash and $350,000 in other resources over the same period. The first chairholder is Prof. Raafat Mansour, who worked for Com Dev from 1986-1999.

Endgame becomes Global Beverage Group; adds U.S. operations
January 25, 2002

Endgame Systems, which took over Descartes' direct store delivery (DSD) products when it was spun-off two years ago, has merged with Digatex Inc. of Austin, Texas. The combined company is operating as Global Beverage Group and is based in the Descartes building in Waterloo.

Global Beverage Group also acquired a 49% stake in Colorado-based Application Design Associates, a subsidiary of San Jose's Semotus Solutions Inc. Semotus acquired ADA just last summer. Global has the option to purchase the remaining 51% of ADA for US$2.5 million. For its minority stake, Global will pay US$1.25 million and assume US$400,000 in liabilities. ADA describes itself as a "provider of equipment-centric tracking software for the beverage and vending industry."

Endgame hadn't issued a news release in almost a year. When we last heard from the company, its CEO was Ed Diamond but he now seems to be out of the picture. The CEO of Global Beverage Group is Ted Hastings.

MKS gets closer to break-even levels
February 26, 2002

For the quarter ended January 31 (Q3 02), MKS reported a net loss of US$825,000 (US$0.002/share) on revenue of US$7.1 million. The loss in an improvement from a US$1.2 million shortfall in the prior quarter and a US$4.1 million loss in the same period last year.

Sales were up 4% sequentially and 11% from a year ago. The company's interoperability unit logged its first sequential gain in over a year, climbing 13% to US$3.0 million -- down 12% from last year. Software change management (SCM) sales dipped slightly to US$4.1 million, up 36% from a year ago. The company says it went from closing 10 deals with a value over US$50,000 in the previous quarter to 25 in Q3.

With one quarter left in the fiscal year, MKS shaved about another million dollars off its projections for 2002 and is now expecting annual revenue of US$28-29 million, which would be an increase from US$27.3 million in 2001.

MKS received US$5.7 million from the sale of warrants in Q3 and had US$8.9 million at quarter-end -- up US$4.0 million. Operations used US$1.6 million in cash.

At the end of January, MKS had 270 employees worldwide.

STOCK REPORT: Descartes, Virtek lose a quarter of their value
February 2002

After a few nice months, it was back to the doldrums with a month where the bad news overwhelmed the good.

For the month of February:

Turbosonic [OTCBB: TSTA] +67%
EMJ [TSE: EMJ] +13%
Navtech [OTCBB: NAVH] 0%
=================================
CME Telemetrix [CDNX: YME] -2%
Open Text [TSE: OTC] -2%
Finline [CDNX: FIN] -9%
Dalsa [TSE: DSA] -9%
RIM [TSE: RIM] -10%
MKS [TSE: MKX] -11%
Com Dev [TSE: CDV] -21%
Descartes [TSE: DSG] -24%
RDM [CDNX: RC] -27%
RecycleNet [OTC: GARM] -28%
Virtek [TSE: VRK] -29%
Urbana.ca [OTCBB: URBA] -33%
GUARD [CDNX: GUA] -36%

Descartes shares closed last Friday at $7.25 -- 50 cents below where they were at the end of February 1998 and not far above the IPO price of $7.00, set in October 1997. Descartes is far from alone in showing no gains over the last four years. Shares of Com Dev, MKS, Virtek, CME Telemetrix, Finline, ATS, and GUARD have all declined from their price at this time in 1998. Gainers over that period include RIM, Dalsa, and Open Text.

Of course, Descartes' early investors had plenty of opportunity to cash in big. Few have done better than Schwartz himself, who -- according to insider trading reports -- has netted over $20 million in the last two years by selling off Descartes shares.

GUARD shares are now down to just nine cents and the company seems to be on its last legs. The same can be said for Urbana, which is rumoured to have moved out of its Cambridge office mid-month. Urbana shares last traded for two-tenths of a U.S. cent (you can make up your own joke about what that would be in Canadian dollars).

Companies with headquarters outside the area also did poorly:

Agfa-Gevaert [Brussels: Agfa] +7%
=================================
CheckFree [Nasdaq: CKFR] -4%
Sybase [NYSE: SY] -7%
Cyberplex [TSE: CX] -8%
Engineering.com [CDNX: EGN] -14%
Network Assoc [Nasdaq: NETA] -21%
Siebel [Nasdaq: SEBL] -22%
VoiceIQ [CDNX: VIQ] -23%
CVF Technologies [Amex: CNV] -38%
CacheFlow [Nasdaq: CFLO] -41%

CacheFlow announced a restructuring and layoffs, but it didn't comment on what impact this would have on its Canadian operations. Trading in VoiceIQ was suspended late in the month, and that probably saved the company's shares from logging a larger collapse.

CME Telemetrix claims patent infringement by U.S. competitor
February 26, 2002

CME Telemetrix -- with its stock at an all-time low -- has taken a page from UBS' book and filed a patent infringement complaint against Arizona's Instrumentation Metrics Inc. The complaint was filed in California just days after the U.S. company announced it had raised US$30 million in a fourth round of financing.

Instrumentation Metrics had raised an additional US$10 million a year and a half ago. Its valuation and cash reserves would dwarf that of CME, which currently has a market cap of about US$4.5 million.

Like CME, Instrumentation Metrics is developing a non-invasive glucose monitor based on near-infra-red technology. CME claims its rival's technology infringes on its U.S. patent, filed over a decade ago and entitled "Method and device for measuring concentration levels of blood constituents non- invasively."

CME is also involved with a suit and countersuit with Neurosoft of Virginia. It acquired CME's Advantage Medical division in 1999 and then refused to pay the full price CME had expected to receive. In 2000, CME filed suit against Neurosoft for $2.2 million; Neurosoft countered with a $9.5 million claim a few months later.

There hasn't yet been any word from CME on the results of the tests it ran on its instrument in November and December. The company said the results would be available in the first quarter of this year, which has another four weeks to go.

Miscellaneous Tidbits

• Avvida Systems is the new company that is taking over from V Technology North America -- the Japanese-owned company that acquired the assets of Focus Automation last year (see last Digest). Ron Strauss, the former CEO of Focus Automation, is the CEO of Avvida. Some former Focus employees just had a nice payday with the sale of Mitra, but Avvida hasn't said who its financial backers are. The company, which has 26 employees, specializes in FPGA-based, high-speed image processing systems.

• Covarity, the company launched by Ardesic co-founder Jeff Fedor and staffed by ex-Ardesic employees, was mentioned in the Wall Street Journal's story "Microsoft Scrambles to Entice Techies Back to Fold With Visual Studio.NET." Covarity was cited as an example of Microsoft's success at winning developers over to .NET from Java, although the way the story was written I don't think Scott McNealy lost any sleep. The story mentioned that Microsoft provided Covarity with "early versions of products and access to Microsoft experts." Covarity is working on applications for the financial services industry, according to its Web site. MKS also announced its support for .NET in February.

• According to the National Post, Guelph's EMJ Data Systems is the backer of Netwinder Canada Inc., the company that recently acquired the Netwinder assets from Rebel.com's receiver. Netwinder was originally developed by Corel and sold to Rebel.com, which went into receivership last summer. The rumoured purchase price was only $268,000. Corel and Rebel are said to have spent $20 million in developing the product line. EMJ had been one of Rebel's distributors for Netwinder and made what it described as a small investment in Rebel in 2000.

• Canadian Venture Capital Association president John Eckert said in an interview last month with one of the Plesman publications (Computing Canada, et al) that he was "surprised by the lack of VC growth in Ontario's Kitchener/Waterloo region, which accounts for only one per cent of overall financing." And half of that came from Sandvine, with ADexact accounting for maybe another 20%. Unfortunately, I'm not surprised and I don't put much of the blame on the VCs. The ability to discern and forecast a market opportunity is not a skill in abundance among start-ups in this area (with some exceptions, thankfully). It's probably not in abundance anywhere, but some of the things I read and heard from the VC fair were just embarrassing.

• UW spinoff Biorem announced near the end of January that it had received an $800,000 order -- its largest ever. A county in Alabama purchased six biofilter units for use in a new sewage pumping station. According to the release, Biorem's order backlog now stands at $3 million. CVF Technologies owns 80% of Biorem, but said a year ago that it was trying to sell the business. It was founded by professor Owen Ward, who was at the Technology Investor Forum to present his latest venture, Lystek International, which has developed a process for the treatment of sewage sludge.

• Ron Neumann, the former president of LivePage and CEO of Waterloo Maple is now heading 3C Infotech, a developer of caching and compression technology. It was also at the Technology Investor Forum, seeking $1.5-2 million.

• RIM and its old nemesis, Glenayre Electronics, have teamed up to integrate Glenayre's messaging services with RIM's BlackBerry. The two companies announced that they have settled the patent and trademark infringement complaint that RIM filed against Glenayre last May. Shortly after RIM filed the complaint, Glenayre announced it was getting out of the wireless messaging business and laying off most of its workforce. In July 1999, Glenayre filed an unsuccessful patent infringement complaint against RIM.

• PrinterOn announced alliances with both Palm and RIM to distribute its PocketWhere wireless Internet printing application for Palm OS and Blackberry devices.

• For the quarter ended December 31 (Q2 02), Turbosonic reported a loss of US$203,000 (US$0.02/share) on revenue of US$563,000. Sales were down 73% from the previous quarter and 64% from the same period last year. The company says it expects its sales will be much higher through the rest of the year.

• Bob Dawson, who had been GM of Cyberplex's Waterloo site, has become a VP at Quarry Integrated Communications. I don't hear much about Cyberplex in Waterloo anymore. Jeff Janssen, the original GM in Waterloo, became the company's CIO last year and works out of Toronto. Rob Payne, who had been Cyberplex's CTO, left the company several months ago.

• The new president of Finline is Ken Mitchell, previously GM of Philips Analytical in Waterloo (which must have at least a year ago, since a recent story in The Record said the current GM had been in that job for that long) and the former CEO of Waterloo Scientific. Waterloo Scientific was founded by UW physics professor Ted Dixon who is a long-time colleague of Finline director Jim Leslie. In 1978 Dixon and Leslie founded Waterloo Distance Education Inc. and WDE Inc. is the registered Canadian patent holder of the compression technology that Finline acquired two years ago. Since 1998, Finline has hired a new COO or president every other year. Al Loughrey lasted about seven months in 1998, as did Todd Grunberg in 2000. Just days after announcing Mitchell's appointment, Finline said it had signed two "conditional" contracts worth $4 million to provide equipment to Russian buyers.