CCC Internet Solutions Inc.is an Au tomo t i ve
Information Service provider that owns and
operates revenue producing automotive
related web sites.
1 Corporate Profile and Financial Highlights 2 Report to Shareholders
4 Management’s Discussion and Analysis 6 Auditor’s Report
7 Consolidated Balance Sheet 8 Consolidated Statement of Income and Deficit
10 Notes to Consolidated Financial Statements 16 Corporate Information
CCC Internet Solutions Inc. is an AutomotiveInformation Service provider that owns and operates rev-enue producing automotive related web sites.
Through its two B2C (Business to Consumer) websites at www.carcostcanada.com and www.freein-voiceprices.com, "CCC" offers comprehensive up todate new car buyer information, including confiden-tial dealer invoice cost prices, to aid the consumerin making informed choices by providing accurateand timely confidential automobile industry informa-tion. To date over 27,000 people have joined asmembers of our sites, generating very consistentrevenue growth. Membership fees have consistent-ly risen throughout the last three years. Currently theaverage membership revenue is over $37.00 permember. On average over 1,000,000 new vehiclesare sold to the retail public each year in Canada.This year we increased our market share from0.71% to 1.38%, an increase in market penetrationof 94%. We are well on our way to reaching our long-term goal of 10% of all new car retail buyers in Canada.
Through its B2B (Business to Business) website, www.43r.ca, "CCC" exclusively serves theAutomotive Insurance Industry. By providing thevaluable confidential automobile industry informa-tion to the Insurer, 43r.ca dramatically lowers settle-ments on automobile total-loss claims with43r/Waiver of depreciation endorsements. A Waiverof Depreciation endorsement entitles the policyholder, of a vehicle that has been deemed to be a
CORPORATE PROFILE
total-loss, to a settlement price based on the originalsale price or replacement value, whichever is lower.Otherwise, the settlement price would be based onthe then current depreciated value of the automo-bile. This can have the effect of raising the settle-ment claim by thousands of dollars. Due to the min-imal cost of purchasing the 43r/waiver of deprecia-tion endorsement, which is typically available forthe first three years of the vehicle’s life and the valuethat the endorsement brings to the consumer, it hasbecome a very popular choice for new car buyers.Potential savings to the Industry, based on industryestimates of 50,000 annual claims and our provenrecord of savings of over $ 1,000 per claim, theInsurance industry could save in excess of $50 mil-lion annually. 43r.ca charges the InsuranceCompany a flat fee of $200.00 per claims transac-tion based on a guaranteed savings to theInsurance Company of at least $1,000 per claim. Itshould be noted that there is no net cost to theInsurance Company only a savings. Since its launchin January 2002, we have handled over $12,000,000worth of claims with an average savings of over$1,200 per claim. Due to the overwhelming accept-ance by many of Canada’s largest Insurance com-panies we are currently increasing our capacity tomeet demand.
The annual meeting of CCC Internet Solutions Inc.will be held on November 26, 2002 at 4:30 p.m. inThe Canadian Room at The Ontario Club located atCommerce Court South, Toronto, Ontario, on the 5th floor.
FINANCIAL HIGHLIGHTS 2002 2001 % ChangeFourth quarter revenue $186,020 $83,284 +124%
Total revenue for the year $535,675 $283,879 + 89%
Total expenses $647,039 $422,995 +53%
Total loss before amortization $111,364 $139,116 -25%
Amortization $63,327 $51,137 +24%
Total loss after amortization $174,691 $190,253 -9%
One time gain on foreignness of debt NIL $130,774 N/A
Total loss for the year $174,691 $59,479 +294%
Loss per share fully diluted for the year $0.016 $0.006 +167%
Outstanding common shares 11,061,233 10,501,952 +5%
CCC Internet Solutions 2002 Annual Report 1
9-11 will forever change the way public companies do busi-
ness in North America. Terrorism reached new heights; a
recession spread throughout the world; a meltdown that dec-
imated the technology industry; a dramatic decrease in the
major North American stock markets for the second year in a
row; and corporate scandals of unprecedented magnitude,
which rocked the corporate world. These events reinforced
the management of CCC’s belief that focus, discipline, sound
business management and solid corporate governance had
become mandatory if CCC, as a Public Company, was to gain
a reputation for conducting its’ affairs with integrity.
Management has undertaken a program to implement all
changes necessary to achieve that reputation amongst the
investing public.
REPORT TO SHAREHOLDERS
2
CCC Internet Solutions 2002 Annual Report 3
During the past fiscal year, the company has grown in many areas. An important new Insurance Solutions divi-sion called 43r.ca, was launched and has been successful and lucrative. In order to capitalize on the signif-icant opportunity presented by the 43r.ca initiative, CCC has appointed a very experienced President, BrianRadigan to aggressively persue the opportunity. (A discussion of the 43r.ca initiative can be seen in theCorporate Profile section.)
CCC’s’ flagship Car Cost Canada.com is the core automobile information services division of our company.The B2C website at www.carcostcanada.com , has been totally enhanced and updated to add much more value for the potential customer. These ongoing changes are helping the Company focus on itsstrengths, while strengthening its brand. Any new car purchaser can benefit financially from this service. Theinformation available on our site provides the customer with confidential new car dealer invoice cost prices,factory incentives and rebate information. This coupled with our ability to negotiate very low acquisition priceson new cars, makes our service an invaluable necessity for the shrewd new car buyer.
"Lowest new car prices in Canada….Guaranteed!"
In addition and in response to market opportunities, CCC has launched a complementary site to Car CostCanada.com called freeinvoiceprices.com at www.freeinvoiceprices.com which provides CCC with anothervaluable revenue producing stream. Here is how it works. For the first time ever, Canadian new car buyersnow have access to confidential new car dealer invoice prices effectively for free; based upon CCC’s exclusive redeemable coupon program. Up until now, Car Cost Canada.com was the exclusive online source for this valuable information for a fee ranging from $25 to $45. Free Invoice Prices.com, in addition toproviding our "Subscribers" dealer invoice prices, will also provide access to confidential factory rebates and incentive programs. For the service, CCC will charge the consumer a fee of $50.00, which is fully refundableto the consumer by the New Car Dealer of the consumer’s choice, upon conclusion of the purchase of his orher new car.
Finally, two new Independent directors were elected to the Company’s board and an Independent auditcommittee was established to ensure a high standard of corporate governance.
Operationally, and with these new initiatives in place, Management came very close to achieving its goal ofmaking a profit in the 4th quarter. Looking ahead, Management is confident that it can attain its goal for 2003.To turn a profit and to grow both top line revenues and profits on a quarter over quarter basis is our main priority.
It is Managements’ view that in today’s economic climate investors will only be interested in those internet-based companies that are profitable, demonstrate significant potential and are built on solid and traditionalbusiness fundamentals. Discipline and commitment to these guiding principals will ensure "CCC’s" stable andlong range potential for capital appreciation
Management feels that all of the initiatives put in place over this past year will set a platform from which CCCshould be able to deliver superior returns to our stakeholders.
September 30, 2002
R. James Matthews Paul Timoteo
Chief Executive Officer President
OverviewDuring the year Management clearly announced its
corporate goals to the shareholders:
Throughout 2002 "CCC" will focus on the continued
and aggressive expansion of its multiple revenue
streams while enhancing its web sites in order to
move toward sustained profitability.
Management was unwavering in its determination to
achieve these corporate goals.
During this time and subsequent to year-end the
company has reached many important milestones.
CCC expanded its revenue streams with the launch
of 43r.ca, (our Insurance Solutions business),
increased its margins and revised its membership
plans to better reflect market demand at Car Cost
Canada.com and it successfully launched Free
Invoice Prices.com. These changes included a total
redesign of the Car Cost Canada.com website and
several other enhancements to ensure easier navi-
gation and higher profit margins. Lastly and most
importantly, the fourth quarter was CCC’s best ever,
with sales increasing to $186,020, 48% better than
our third quarter of 2001-2002 and 124% better than
our fourth quarter of 2000-2001. The bulk of the
increase in the fourth quarter was a direct result of
the commencement of revenue generation from the
43r.ca initiative.
The following is a summary of the achievement’s
and milestones that have been recently reached for
and subsequent to the period:
• Our Insurance Solutions business 43r.ca was
launched, has received overwhelming accept-
ance and is rapidly growing.
According to Mr. Don Lough, President, Property and Casualty
Insurance for ING Canada, “the pilot program was an over-
whelming success and its results handily exceeded our expecta-
tions”. "43r.ca clearly demonstrated the tremendous value that
they can bring to our business", said Mr. Lough. "We are very
excited about the program and are looking forward to a solid
long-term relationship with CCC Internet Solutions Inc."
MANAGEMENT’S DISSCUSSION AND ANALYSIS
• Mr. Br ian Radigan, LLB. , was appointed
President of the Company’s 43r.ca division.
"I am both enthusiastic and energized by my appointment as
President of 43r.ca and look forward to the challenges and
opportunities my role will bring" said Radigan. "In a very short
time, 43r.ca has clearly demonstrated its big-sky potential. The
opportunity for me now will be to make a major contribution
to the development of 43r.ca’s great potential; and that I am
very excited about!"
• Car Cost Canada was successfully redesigned.
"Total membership sales totalled 13,809, an increase of 94%
over last year."
• Free Invoice Prices was successfully launched.
• Two Independent directors, Richard Buzbuzian
and Greg Harris, were appointed to the
Company’s Board.
• An Independent Audit Committee and Audit
Committee Mandate have been established for
the Company to ensure quality of corporate
governance and provide shareholders the confi-
dence they deserve.
OperationsAs a result of CCC’s progressive activities for the fis-
cal period, total revenue rose to a record $535,675,
an 89% increase over fiscal 2000-2001. Total oper-
ating expenses before amortization were $647,039,
an increase of 53% over fiscal 2000-2001. Total
losses for the year were $174,691, 9% lower than
4
fiscal 2000-2001 before a one time gain for forgive-
ness of debt.
On June 5, 2002 we announced that an agreement
of debt conversion with Paul Timoteo, James
Matthews, Eli Oszlak and Lease Busters Inc. to con-
vert two-thirds of the $197,676.85 debt owing by
CCC Internet Solutions Inc. to such persons into
common shares of the company, had been com-
pleted. The shares have been issued and the debt
has been extinguished.
CCC’s balance sheet is now 100% debt-free.
"As we begin our new fiscal year, which commenced June 01,
2002, we are better than ever positioned, to realize the true
potential of our company. We are now totally debt free, cash
flow positive and looking forward to reporting profitable and
sustainable bottom-line results,"
Our flagship site Car Cost Canada.com continued
to deliver solid growth. This year we sold 13,809
memberships, compared to 7,122 last year, an
increase of 94%. This brings our membership
base to a grand total of 22,585, an increase of
257% compared with the total of 8,776 as of
May 31, 2001.
The Corporation reported a loss of $174,691 for the
year ended May 31, 2002 that includes a total non-
cash item of $63,327 in amortization expense. Cash
used in operations was $248,521. Based on a year-
end cash position of $186,739, no debt and positive
cash flow going forward, management feels that
they are in a good position to meet all current and
foreseeable financial obligations.
As for our competition, history has demonstrated
that due to the confidentiality of much of our data,
the barrier of entry into our business remains very
high. Currently, to the best of management’s knowl-
edge, there is no other company offering both the
range of products and services and the ability to
deliver these products and services online.
Risk ManagementCCC Internet Solutions Inc. is subject to the risk
generally associated with the operation of income-
producing websites and high-technology invest-
ments. These risks include fluctuations in site traffic,
sales, operating expenses, and the risk of unavail-
ability of further equity financing and/or funding.
Other associated risks may include competition,
technical constraints in further business develop-
ment, and possible service interruptions.
OutlookCCC management for 2002 to 2003 looks to:
Aggressively grow the 43r.ca Insurance
Solutions business and secure Master Vendor
Agreements with Canadian Insurance
Companies where available and as quickly as
possible.
Increase revenues from our flagship website
Car Cost Canada.com (www.carcostcanada.com)
through continued innovative improvements,
effective marketing campaigns and expansion
of strategic partnership agreements with
Yahoo! Autobytel.ca and other large national
organizations.
Increase our market share through effective
sales and marketing of both our B2C and B2B
businesses.
Achieve and sustain profitability with
sequential earnings growth for the year ahead.
Achieve more cost efficiencies in all of
the operations.
It is Management’s belief that CCC Internet
Solutions Inc., with its financial and human
resources, is poised for significant growth as it cap-
italizes and grows it’s niche markets in all aspects of
it’s Internet and traditionally based businesses.
It is expected that Management can meet these
objectives regardless of economic conditions.
Although a robust economy can lead to a greater
number of cars sold and thus a potentially larger
market opportunity for all of CCC’s’ divisions, a
down economy can have an equally positive impact
as both individuals and Insurance Companies
become more cost conscious.
CCC Internet Solutions 2002 Annual Report 5
MAY 31, 2002
To the Shareholders of CCC Internet Solutions Inc.
I have audited the consolidated balance sheet of
CCC Internet Solutions Inc. as at May 31, 2002 and
the consolidated statement of income and deficit
and consolidated statement of cash flows for the
year then ended. These consolidated financial
statements are the responsibility of the company’s
management. My responsibility is to express an
opinion on these consolidated financial statements
based on my audit.
I conducted my audit in accordance with Canadian
generally accepted auditing standards. Those stan-
dards require that I plan and perform an audit
to obtain reasonable assurance whether the
consolidated financial statements are free of mis-
statement. An audit includes examining, on a test
basis, evidence supporting the amounts and
disclosures in the consolidated financial statements.
An audit also includes assessing the accounting
principles used and significant estimates made by
management, as well as evaluating the overall con-
solidated financial statement presentation.
CONSOLIDATED FINANCIAL STATEMENTS
AUDITOR'S REPORT
6
In my opinion, these consolidated financial
statements present fairly, in all material respects, the
consolidated financial position of CCC Internet
Solutions Inc. as at May 31, 2002 and the results
of its operations and its cash flows for the year then
ended in accordance with Canadian generally
accepted accounting principles.
Toronto, Ontario
July 31, 2002
Philip Gigan
CHARTERED ACCOUNTANT
CCC Internet Solutions 2002 Annual Report 7
CURRENT
GIC (note 4) $240,452 $375,000
Accounts receivable 74,706 25,749Prepaid expenses and sundry assets 9,770 28,566Bank - 60,260GST receivable - 3,004
324,928 492,579
CAPITAL ASSETS – NET (notes 3 and 5) 57,779 58,195
OTHER ASSETS
Intangible assets-net(notes 3,7(a) and 8(f)) 227,997 257,997Deferred acquisition costs-net(notes 3 and 7(b)) 56,064 72,083
284,061 330,080$ 666,768 $ 880,854
LIABILITIES
CURRENT
Bank overdraft $ 53,713 $ - Accounts payable and accrued liabilities (note 8(g)) 73,043 40,531Advances from directors (note 8(g)) 14,852 7,652Note payable (note 8(c)) - 125,000Deferred revenue - 12,500Loan payable – Lease Busters Inc.(note 8(b)) - 151,105
141,608 336,788
SHAREHOLDERS’ EQUITY
CAPITAL STOCK (note 9) 733,628 577,843
DEFICIT (208,468) (33,777)525,160 544,066
$ 666,768 $ 880,854
APPROVED ON BEHALF OF THE BOARD:
R. James MatthewsChief Executive Officer
Paul TimoteoPresident
CONSOLIDATED BALANCE SHEET
AS AT MAY 31, 2002 2002 2001
8
REVENUE (note 3) $ 535,675 $ 283,879
EXPENSES 112,702 43,109Advertising (note 8(g)) 112,702 43,109Office salaries 110,979 47,067Management salaries and fees (note 8(e)) 102,000 101,000Computer consulting and supplies (note 8(g)) 71,903 31,250Investor relations 54,739 57,601Professional fees 32,285 19,923Selling fees 31,187 5,222Automobile and travel (note 8(g)) 26,947 24,241Bookkeeping (note 8(g)) 24,000 14,050Bank charges and interest 16,284 8,679Rent and common area costs (note 8(d)) 14,827 14,220Transfer and exchange fees 11,353 6,088Employee benefits 11,269 6,165Interest on long term debt (note 8(b)) 10,054 6,269Office and general (note 8(g)) 10,633 8,160Telephone 6,926 3,679Temporary services 3,900 8,438Selling salaries 2,501 26,667Insurance 2,010 - Bad debts 1000 - Less:Interest income (10,460) (8,833)
647,039 422,995
(LOSS) BEFORE AMORTIZATION (111,364) (139,116)
LESS: AMORTIZATIONIntangible assets (notes 3,7(a) and 8(f)) 30,000 30,000Capital assets (notes 3 and 4) 17,308 13,545Deferred acquisition costs (notes 3 and 7(b)) 16,019 7,592
63,327 51,137
NET (LOSS) BEFORE UNDERNOTED ITEM (174,691) (190,253)
ADD: GAIN ON FOREGIVENESS OF DEBT - 130,774
NET (LOSS) (Basic and fully diluted loss per share-$0.01) (174,691) (59,479)
(DEFICIT) RETAINED EARNINGS, beginning of year (33,777) 25,702
DEFICIT, end of year $ (208,468) $ (33,777)
CONSOLIDATED STATEMENT OF INCOME AND DEFICIT
FOR THE YEAR ENDED MAY 31, 2002 May 31, 2002 May 31, 2001
CCC Internet Solutions 2002 Annual Report 9
CASH USED IN OPERATING ACTIVITIESNet loss $ (174,691) $ (59,479)
Add: Amortization of capital assets 17,308 13,545
Amortization of intangible assets 30,000 30,000
Amortization of deferred acquisition costs 16,019 7,592
(111,364) (8,342)
Net changes in non-cash working capital
balances related to operations 55 2,119
(111,309) (6,223)
CASH USED IN INVESTMENT ACTIVITIES
Purchase of capital assets (16,892) (57,430)
Deferred acquisition costs - (79,675)
(16,892) (137,105)
CASH PROVIDED BY FINANCING ACTIVITIES
Decrease in
loan payable – Lease Busters Inc. (151,105) (154,517)
Issuance of capital stock 155,785 50,000
(Decrease) increase in note payable (125,000) 125,000
Fair value of shares issued - 527,842
(120,320) 548,325
(DECREASE) INCREASE IN BANK (OVERDRAFT) AND GIC (248,521) 404,997
BANK AND GIC, beginning of year 435,260 30,263
BANK AND GIC, end of year $ 186,739 $ 435,260
NET CHANGES IN NON-CASH WORKING CAPITAL CONSISTS OF:GST receivable 3,004 $ 19,851
Accounts receivable (48,957) 20,524
Prepaid expenses and sundry assets 18,796 (21,472)
Accounts payable and accrued liabilities 32,512 13,739
Advances from directors 7,200 (13,433)
Deferred revenue (12,500) (17,090)
$ 55 $ 2,119
CONSOLIDATED STATEMENT OF INCOME AND DEFICIT
FOR THE YEAR ENDED MAY 31, 2002 May 31, 2002 May 31, 2001
MAY 31, 2002
1. BASIS OF PRESENTATION
The consolidated balance sheet of CCC Internet Solutions Inc. (Formerly Duke Capital Corp.)
(“CCCBC”) a company incorporated under the laws of the province of British Columbia, gives effect
to the reverse takeover whereby CCCBC, the legal parent, was acquired by CCC Internet Solutions
Inc.(Formerly E-Tom Technologies Inc.) (“CCCONT”) a company incorporated under the laws of the
province of Ontario, the legal subsidiary.
This reverse takeover occurred on October 30, 2000 pursuant to a Share Purchase Agreement
whereby CCCBC acquired all of the outstanding shares of CCCONT in exchange for 6,500,000
CCCBC shares and $150,000 of which $100,000 had been paid. The remaining $50,000 was con-
verted into shares of “CCCBC”as described in note 8(c)and 9(a).
These consolidated financial statements include the accounts of CCCBC and CCCONT. All material
inter-company balances, transactions and profits have been eliminated.
The prior year’s comparative figures have been reclassified, where necessary, to conform with the
current year’s presentation.
2. BUSINESS COMBINATION
a- The business combination occurred on October 30, 2000 and is accounted for by the purchase
method, with CCCONT being deemed the acquirer, because this exchange of shares leaves the
former shareholders of CCCONT with the majority of the issued shares of CCCBC.
As a result, the balance sheet of CCCONT is recorded at book value and the balance sheet of
CCCBC is recorded at fair market value at October 30, 2000.
b- Current Assets Of CCCBC @ October 30, 2000 $ 677,842
Liabilities Assumed Of CCCBC @ October 30, 2000 -
Cost Of Purchase $ 677,842
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
These financial statements have been prepared in accordance with Canadian generally accepted
accounting principles. The following is a summary of significant policies;
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
10
CAPITAL ASSETS
Capital assets are recorded at historical cost. Amortization is charged to earnings over the estimat-
ed useful life of the assets on the following basis:
Leasehold improvements - straight line over 5 years
Furniture and fixtures - 20% declining balance
Computer hardware - 30% declining balance
Computer software - 100% declining balance
Capital assets purchased during the year are amortized at one-half the above stated rates.
REVENUE RECOGNITION AND DEFERRED REVENUE
Customer membership fees are recognized on a monthly prorata basis. The unearned portion is
reflected as deferred revenue on the balance sheet.
INTANGIBLE ASSETS
Intangible assets are recorded at acquisition cost. Amortization is provided on a straight line basis
over 10 years with half rates taken in the year of acquisition.
DEFERRED ACQUISITION COSTS
Deferred acquisition costs are recorded at cost and are amortized on a straight line basis over 5
years with half rates taken in the initial year.
EARNINGS PER SHARE
The computation of earnings per share is based on the weighted average number of common shares
outstanding during the year.
4. GIC
The GIC bears interest at 1.75% and matures on January 28, 2003.
5. CAPITAL ASSETS
Capital assets consist of:
May 31, 2002 May 31, 2002 May 31, 2002 May 31, 2001Accumulated Net Book Net Book
Cost Amortization Value Value
Leasehold improvements $ 43,643 $ 13,093 $ 30,550 $ 39,278
Furniture and fixtures 8,171 2,004 6,167 5,295
Computer hardware 31,089 11,161 19,928 13,316
Computer software 9,894 8,760 1,134 306
$ 92,797 $ 35,018 $ 57,779 $ 58,195
CCC Internet Solutions 2002 Annual Report 11
cont..., NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
6. GST RECEIVABLE
GST receivable represents GST input tax credits in excess of GST collected from customers.
7. OTHER ASSETS
a- Intangible assets consist of the “Autohotline” as described in note 8(f):
May 31, 2002 May 31, 2002
Acquisition cost $ 300,000 $ 300,000
Less: Accumulated amortization (72,003) (42,003)
$ 227,997 $ 257,997
b- Deferred acquisition costs represents the cost of professional fees for the reverse takeover as
described in note 1:
May 31, 2002 May 31, 2002
Acquisition costs $ 79,675 $ 79,675
Less: Accumulated amortization (23,611) (7,592)
$ 56,064 $ 72,083
8. RELATED PARTY TRANSACTIONS
a- Advances from directors are non-interest bearing and due on demand. Two directors of the
company are also directors and controlling shareholders of Lease Busters Inc.
b- The loan payable was due to Lease Busters Inc. Interest at 8% was payable on this loan until
December 31, 1999. Effective January 1, 2000, this loan was non-interest bearing until January 1,
2001. On January 1, 2000 $173,702 of this debt was foregiven and $130,774 was foregiven on July
1, 2000. Effective January 1, 2001, interest accrued at 8% per annum. $69,320 of this loan was
repaid in cash during the current fiscal year. The remaining $81,785 was exchanged for 272,615
common shares of the corporation (as described in note 9(b)).
c- Pursuant to the reverse takeover as described in note 1, there was a $150,000 non-interest bear-
ing note payable due to the shareholders of CCCONT. $100,000 of this note payable was repaid dur-
ing the last two fiscal years. The remaining $50,000 was exchanged for 166,666 common shares of
the corporation (as described in note 9(b)).
d- Included in expenses are the following paid to Lease Busters Inc.:
2002 2001
Rent - at fair market value $ 12,000 $ 12,000
cont..., NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
12
CCC Internet Solutions 2002 Annual Report 13
e-Management salaries and fees were paid to directors of the company.
f- Intangible assets were acquired from Lease Busters Inc. and represent the purchase of the rights,
systems, data and clientele of Lease Busters Inc.’s “Autohotline”.
g- Included in expenses are the following paid to directors and parties related to directors of the
company:
2002 2001
Advertising $ 2,925 $1,787
Bookkeeping 24,000 14,050
Computer consulting 54,694 18,584
Office and general 800 750
Automobile 21,600 15,600
$ 104,019 $ 50,771
Included in accounts payable is $5,416 (2001-$20,080) due to these related parties.
9. CAPITAL STOCK
a- Authorized
100,000,000 common shares without par value
b- IssuedCCC Internet Solutions Inc. (Formerly E-Tom Technologies Inc.)
Balance as at May 31, 2001 May 31, 2002
100 $ 1
CCC Internet Solutions Inc. (Formerly Duke Capital Corp.)
Balance as at May 31, 2001 10,501,952 $ 1,438,916
Issued in consideration of debt retirement 272,615 81,785
to Lease Busters Inc.
Issued in consideration of debt retirement 166,666 50,000
to directors
Issuance of capital stock – 120,000 24,000
stock options exercised
Balance at May 31, 2002 11,061,233 1,594,701
Combined balances at May 31, 2002 11,061,333 1,594,70
Eliminate consolidation of subsidiary (100) (861,074)
Consolidated balance sheet at May 31, 2002 11,061,233 $ 733,628
cont..., NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
c- Fully Diluted Shares
Balance at May 31, 2002 in note 9(b) 11,061,233 $ 733,628
Common shares issuable pursuant to incentive
stock options held by directors and officers 390,000 214,500
of CCCBC (note 9d(i))
Common shares issuable pursuant to incentive
stock options held by employees and others (note 9d(ii))
155,000 85,250
Common shares issuable under the unexercised
portion of the warrants granted to private
placement financing sources (note 9(f)) 761,952 761,952
Fully diluted share capital 12,368,185 $ 1,795,330
d- Stock Options
i- Directors
The company has granted stock options to its directors to purchase up to 510,000 common shares
of the company. 120,000 options were exercised at $.20 during the current fiscal year. 390,000
options are exercisable at $.55 per share and expire on February 15, 2006.
ii- Employees And Others
The company has granted stock options to its employees and others to purchase up to 155,000
common shares of the company exercisable at $.55 per share. These options expire on February 15,
2006.
e- Warrant – Listing AgentPursuant to an Agency Agreement dated August 26, 1999, the company’s listing agent was granted
non-transferable warrants to purchase up to 180,000 common shares of the company at $0.20 per
share. The listing agent exercised the warrant to purchase 90,000 common shares on November 24,
1999 and the remaining warrant to purchase 90,000 common shares was exercised on May 14,
2001.
f- Warrant – Private PlacementPursuant to a private subscription agreement, CCCBC entered into an agreement with a private
investor. This investor agreed to purchase 761,952 common shares at $0.55 concurrently with the
completion of the reverse takeover on October 30, 2000. This investor was also given a warrant enti-
tling him to acquire 761,952 additional CCCBC shares at a price of $1 per share until October 30,
2002.
cont..., NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
14
g- Escrowi- Of the 2,890,000 common shares issued as at August 31, 2000, 666,667 of these issued common
shares are held in escrow in accordance with the terms of the regulation of the Canadian Venture
Exchange.
Escrow (Cont’d)
ii- Pursuant to the share purchase agreement as described in note 1, the 6,500,000 payment shares
are subject to escrow restrictions pursuant to the terms of an escrow agreement which was entered
into between CCCBC, a trustee and the shareholders of CCCONT in the form prescribed by the
exchange. The escrow agreement provides that the payment shares will be released from escrow as
to 5% commencing six months after the date of completion of the transactions (six months from
October 30, 2000) and continuing every six months thereafter until the second anniversary from
October 30, 2000. Thereafter, the remaining payment shares will be released from escrow as to 10%
commencing 30 months after October 30, 2000 and a further 10% every six months thereafter until
all payment shares have been released from escrow. The final tranche of payment shares to be
released from escrow, will be released on the sixth anniversary from October 30, 2000. Therefore,
there are 5,525,000 shares remaining in escrow at May 31, 2002 after 975,000 (15%) have been
released from April 30, 2001 to April 30, 2002.
INCOME TAXES
At May 31, 2002, the company had non-capital losses for income tax purposes of approximately
$561,100 available to offset future taxable income. The potential tax benefits have not been reflected
in these financial statements. These losses will expire as follows:
2007 $ 201,800
2008 $ 199,000
2009 $ 160,300
$ 561,100
CCC Internet Solutions 2002 Annual Report 15
cont..., NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
CCC Internet Solutions Inc.
1230 Crestlawn Drive
Mississauga, Ontario
L4W 1A6
Telephone: (905) 624-3144
Facsimile: (905) 629-3299
http://cccis.ca
http://carcostcanada.com
http://43r.ca
http://freeinvoiceprices.com
Richard Buzbuzian BA.
Greg Harris BA. LLB.
Eli Oszlak
James Mathews B.Comm
Robert Montemarano BA. "Nominee"
Paul Timoteo
James Matthews
Secretary & Chief Executive Officer
Paul Timoteo
President & Chief Financial Officer
Eli Oszlak
Vice President & Chief Technical Officer
TSX Venture Exchange
CIS
Pacific Corporate Trust, Vancouver, B.C.
Harris & Harris, Toronto, Ontario
Philip Gigan C.A., Toronto, Ontario
Bank of Montreal and HSBC, Mississauga, Ontario
Annual Meeting of Shareholders will be held at:
The Ontario Club, in The Canadian Room
Commerce Court South, 5th Floor
Toronto, Ontario
November 26, 2002, at 4:30 p.m.
Corporate Office
Corporate Web Sites
Directors
Officers
Symbol
Transfer Agent
Legal Counsel
Auditor
Annual Meeting
Bank
CORPORATE INFORMATION
16