6-K 1 o31945e6vk.txt FORM 6-K ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ----------------- FORM 6-K REPORT OF FOREIGN ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934 FOR THE MONTH OF MAY 2006 Commission File Number 1-15114 ANTHONY CLARK INTERNATIONAL INSURANCE BROKERS LTD. (Registrant's name) SUITE 355, 10333 SOUTHPORT ROAD S.W. CALGARY, ALBERTA, CANADA T2W 3X6 (Address of principal executive offices) 1. Notice of Meeting and Record Date Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F. Form 20-F [X] Form 40-F [ ] Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): [ ] Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders. Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101 (b)(7): [ ] Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant's "home country"), or under the rules of the home country exchange on which the registrant's securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant's security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR. Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934. Yes [ ] No [X] If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- _________________ ================================================================================ SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant, Anthony Clark International Insurance Brokers Ltd., has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Date: June 7, 2006 ANTHONY CLARK INTERNATIONAL INSURANCE BROKERS LTD. By: "Joseph Giuffre" ----------------------------------------- Joseph P. Giuffre Director and Corporate Secretary May 29, 2006 British Columbia Securities Commission Alberta Securities Commission Saskatchewan Securities Commission Manitoba Securities Commission Ontario Securities Commission Commission des Valeurs Mobillieres du Quebec Office of the Administrator of Securities -- New Brunswick Nova Scotia Securities Commission Registrar of Securities -- Northwest Territories Registrar of Securities, Yukon Territory Registrar of Deed, Companies and Securities, Newfoundland Director of Corporations, Prince Edward Island Nunavut Legal Registries The Toronto Stock Exchange

Dear Sirs: RE: ANTHONY CLARK INTERNATIONAL INSURANCE BROKERS LTD. -- PROFILE #10468 ANNUAL MEETING OF SHAREHOLDERS On behalf of our principal, Anthony Clark International Insurance Brokers Ltd., we wish to confirm the following dates regarding their Annual Meeting of Shareholders: DATE OF MEETING: August 3, 2006 RECORD DATE: June 22, 2006 MATERIAL MAILING DATE: July 5, 2006 APPLICABLE SECURITIES: ISIN NO. Common Shares CA18145N1078 Yours truly, CIBC MELLON TRUST COMPANY "signed" Irma Sailer Rucci Manager, Client Relations (403) 232-2423 irma_rucci@cibcmellon.com

Vinciguerra Schuneman Total ------------ ------------ ------------ Customer accounts $ 1,855,983 $ 227,906 $ 2,083,889 Computer systems and equipment 64,390 36,759 101,149 Non-competition agreements 160,975 34,308 195,283 Goodwill 6,978,094 823,504 7,801,598 Other 6,439 - 6,439 Liabilities assumed (87,527) - (87,527) ------------ ------------ ------------ $ 8,978,354 $ 1,122,477 $ 10,100,831 ------------ ------------ ------------ CONSIDERATION PAID Cash $ 7,857,638 $ 299,588 $ 8,157,226 ------------ ------------ ------------ Fair values of notes payable 1,120,716 822,889 1,943,605 ------------ ------------ ------------ $ 8,978,354 $ 1,122,477 $ 10,100,831 ------------ ------------ ------------

2005 2004 Revenue $ 13,060,344 $ 7,469,559 Earnings before the following (EBITDA) 1,524,161 258,502 Interest and Financing Costs (4,539,268) (941,153) Depreciation and amortization (1,303,867) (481,025) Income Taxes (expense) recovery (151,180) 112,178 NET LOSS $ (4,470,154) $ (1,051,498)

2005 2004 ----------- ----------- CANADIAN OPERATIONS Interest and financing costs on Paragon term loan repaid $ - $ 274,866 Interest on obligations under capital lease 1,410 1,701 ----------- ----------- 1,410 276,567 ----------- ----------- U.S. OPERATIONS Amortization of discount on reclassified long-term debt 166,489 62,625 Interest and loan fees on long-term debt 1,596,851 186,520 Amortization of financing costs 230,199 412,887 Impairment of discount on reclassified long-term debt 1,428,664 - Impairment of deferred financing costs on reclassified long-term debt 1,111,033 - Interest on obligations under capital lease 4,622 2,554 ----------- ----------- 4,537,858 664,586 ----------- ----------- $ 4,539,268 $ 941,153 =========== ===========

MARCH 31, 2005 MARCH 31, 2004 ---------------------- --------------------- MAR DEC SEPT JUNE MAR DEC SEPT JUN ---------- --------- ---------- --------- --------- --------- --------- --------- Revenues 4,872,382 3,146,777 2,528,979 2,512,206 2,828,346 2,035,137 1,220,662 1,385,414 EBITDA 1,732,032 27,253 (394,456) 159,332 433,850 43,376 (463,452) 244,728 Net earnings (loss) (2,079,926) (974,156) (1,057,215) (358,857) (54,305) (629,271) (411,961) 44,039 Earnings (loss) per share Basic and Diluted (0.26) (0.12) (0.13) (0.05) (0.01) (0.08) (0.05) -

Less than 1 - 3 3 - 5 More than CONTRACTUAL OBLIGATIONS Total 1 Year Years Years 5 years -------------------------------- --------- --------- --------- --------- --------- Capital Lease Obligations 39,966 20,735 14,435 4,796 - Operating Lease Obligations 989,698 712,203 277,495 - - DEMAND LOANS Kabaker Family Trust 3,973,513 524,567 751,106 863,627 1,834,213 Schuneman Insurance Agency Inc. 1,397,088 - 57,423 503,021 836,644 Oak Street Funding 3,624,294 - 1,374,706 1,780,408 469,180 First Capital Corporation 3,509,728 - 1,757,420 1,752,308 - Emmett Lescroart 3,931,200 - - 3,931,200 - Al Vinciguerra Ltd. 1,089,241 218,082 484,591 386,568 -

Year Ended March 31 2005 2004 ------------------------------------------ ------------ ---------- Revenue $ 13,060,344 7,469,559 ------------------------------------------ ------------ ---------- Earnings from operations (EBITDA) (I) $ 1,524,161 258,502 ------------------------------------------ ------------ ---------- Total Assets $ 21,862,339 16,209,085 ------------------------------------------ ------------ ---------- Total Liabilities and Shareholders' Equity $ 21,862,339 16,209,085 ------------------------------------------ ------------ ---------- Cash and cash equivalents, end of year $ 401,944 1,989,663 ------------------------------------------ ------------ ---------- Common Shares Outstanding at year end 7,955,153 7,955,153 ------------------------------------------ ------------ ----------

Years ended March 31, 2005 2004 2003 -------------------------------------------- ------------- ------------- ------------- Revenue $ 13,060,344 $ 7,469,559 $ 5,175,072 Net earnings (loss) $ (4,470,154) $ (1,051,498) $ (355,801) Earnings (loss) per share- basic and diluted $ (0.56) $ (0.14) $ (0.05) Total assets $ 21,862,339 $ 16,209,085 $ 8,662,278 ------------ ------------ ------------ Total long-term financial liabilities $ 19,231 $ 7,358,770 $ 17,624 ============ ============ ============

Vinciguerra Schuneman Total ------------ ------------ ------------- Customer accounts $ 1,855,983 $ 227,906 $ 2,083,889 Computer systems and equipment 64,390 36,759 101,149 Non-competition agreements 160,975 34,308 195,283 Goodwill 6,978,094 823,504 7,801,598 Other 6,439 - 6,439 Liabilities assumed (87,527) - (87,527) ----------- ----------- ------------ $ 8,978,354 $ 1,122,477 $ 10,100,831 =========== =========== ============ CONSIDERATION PAID Cash $ 7,857,638 $ 299,588 $ 8,157,226 Fair values of notes payable 1,120,716 822,889 1,943,605 ----------- ----------- ------------ $ 8,978,354 $ 1,122,477 $ 10,100,831 =========== =========== ============

Years ended March 31, 2005 2004 -------------------------------------- ----------------- ---------------- Revenue $ 13,060,344 $ 7,469,559 Earnings before the following (EBITDA) 1,524,161 258,502 Interest and Financing Costs (4,539,268) (941,153) Depreciation and amortization (1,303,867) (481,025) Income Taxes (expense) recovery (151,180) 112,178 ---------------- --------------- Net Loss $ (4,470,154) $ (1,051,498) ================ ===============

2005 2004 --------------- ----------- CANADIAN OPERATIONS Interest and financing costs on Paragon term loan repaid $ - $ 274,866 Interest on obligations under capital lease 1,410 1,701 --------------- ----------- 1,410 276,567 --------------- ----------- U.S. OPERATIONS Amortization of discount on reclassified long-term debt 166,489 62,625 Interest and loan fees on long-term debt 1,596,851 186,520 Amortization of financing costs 230,199 412,887 Impairment of discount on reclassified long-term debt 1,428,664 - Impairment of deferred financing costs on reclassified long-term debt 1,111,033 - Interest on obligations under capital lease 4,622 2,554 --------------- ----------- 4,537,858 664,586 --------------- ----------- $ 4,539,268 $ 941,153 =============== ===========

March 31,2005 March 31, 2004 --------------------------------------------------- ----------------------------------------------- Mar Dec Sept June Mar Dec Sept June ----------- ---------- ----------- ---------- ---------- ---------- ---------- --------- Revenues 4,872,382 3,146,777 2,528,979 2,512,206 2,828,346 2,035,137 1,220,662 1,385,414 EBITDA 1,732,032 27,253 (394,456) 159,332 433,850 43,376 (463,452) 244,728 Net earnings (loss) (2,079,926) (974,156) (1,057,215) (358,857) (54,305) (629,271) (411,961) 44,039 Earnings (loss) per share Basic and Diluted (0.26) (0.12) (0.13) (0.05) (0.01) (0.08) (0.05) -

Less than 1 - 3 3 - 5 More than Contractual Obligations Total 1 Year Years Years 5 years ---------------------------- --------- --------- --------- --------- --------- Capital Lease Obligations 39,966 20,735 14,435 4,796 - Operating Lease Obligations 989,698 712,203 277,495 - - DEMAND LOANS Kabaker Family Trust 3,973,513 524,567 751,106 863,627 1,834,213 Schuneman Insurance Agency Inc. 1,397,088 - 57,423 503,021 836,644 Oak Street Funding 3,624,294 - 1,374,706 1,780,408 469,180 First Capital Corporation 3,509,728 - 1,757,420 1,752,308 - Emmett Lescroart 3,931,200 - - 3,931,200 - Al Vinciguerra Ltd. 1,089,241 218,082 484,591 386,568 _ --------- ------- --------- --------- ---------

2005 2004 ------------ ------------ (Note 22) ASSETS Current assets: Cash and cash equivalents $ 401,944 $ 1,989,663 Accounts receivable 1,708,085 1,335,775 Prepaid expenses 221,705 123,329 Restricted cash (Note 5) - 522,619 ------------ ------------ 2,331,734 3,971,386 Note receivable (Note 6) 181,440 196,575 Due from director (Note 7) 40,000 40,000 Computer systems and office equipment (Note 8) 399,442 376,540 Customer accounts (Note 9) 5,678,499 5,027,401 Goodwill 12,525,334 5,459,185 Deferred financing costs (Notes 10 and 12) - 474,447 Non-competition agreements (Note 11) 705,890 663,551 ------------ ------------ $ 21,862,339 $ 16,209,085 ============ ============ LIABILITIES Current liabilities: Accounts payable and accrued liabilities $ 1,507,553 $ 1,114,545 Demand loans (Note 12) 17,525,064 - Current portion of long-term debt (Note 12) - 462,535 Current portion of obligations under capital leases 20,735 22,912 (Note 13) Income taxes payable 63,877 - Litigation liability (Note 5) - 522,619 ------------ ------------ 19,117,229 2,122,611 Obligations under capital leases (Note 13) 19,231 39,966 Long-term debt (Note 12) - 7,318,804 Future income taxes (Note 18) 316,910 229,607 ------------ ------------ 19,453,370 9,710,988 ------------ ------------ Commitments (Note 19) SHAREHOLDERS' EQUITY Share capital (Note 14) 9,895,142 9,897,116 Contributed surplus 667,585 104,022 Retained earnings (deficit) (8,124,638) (3,502,196) Cumulative translation adjustment (29,120) (845) ------------ ------------ 2,408,969 6,498,097 ------------ ------------ $ 21,862,339 $ 16,209,085 ============ ============

2005 2004 ------------ ------------ REVENUE $ 13,060,344 $ 7,469,559 ------------ ------------ EXPENSES General and administrative 2,393,711 1,446,886 Legal judgment - 522,619 Rent 805,937 422,672 Salaries and wages 7,925,260 4,818,880 Stock-based compensation 411,275 - ------------ ------------ 11,536,183 7,211,057 ------------ ------------ Earnings before interest, income taxes, depreciation and amortization 1,524,161 258,502 Interest and financing costs (Note 20) (4,539,268) (941,153) ------------ ------------ Earnings (loss) before income taxes, depreciation and amortization (3,015,107) (682,651) Depreciation and amortization (1,303,867) (481,025) ------------ ------------ Earnings (loss) before income taxes (4,318,974) (1,163,676) ------------ ------------ INCOME TAXES (note 18) Current 63,877 - Future (recovery) 87,303 (112,178) ------------ ------------ 151,180 (112,178) ------------ ------------ Net earnings (loss) for the year (4,470,154) (1,051,498) ------------ ------------ RETAINED EARNINGS (DEFICIT), beginning of year As previously reported (3,502,196) (2,450,698) Change in accounting policy (note 3) (152,288) _ ------------ ------------ As restated (3,654,484) (2,450,698) ------------ ------------ RETAINED EARNINGS (DEFICIT), end of year $ (8,124,638) $ (3,502,196) ============ ============ Earnings (loss) per share - basic and diluted $ (0.56) $ (0.14) ============ ============

2005 2004 (Note 22) ------------ ------------ CASH FLOW FROM (USED IN) OPERATING ACTIVITIES: Net earnings (loss) for the year $ (4,470,154) $ (1,051,498) Adjustments to reconcile net cash provided by operating activities Depreciation and amortization 1,303,867 481,025 Future income taxes 87,303 (112,178) Amortization of deferred financing costs and loan discounts 396,688 475,512 Impairment of deferred financing costs and unamortized loan discounts 2,539,697 - Stock-based compensation 411,275 - Changes in non-cash working capital accounts Accounts receivable (370,786) (297,054) Prepaid expenses (103,420) 47,086 Accounts payable and accrued liabilities 365,524 57,212 ------------ ------------ 1 59,994 (399,895) ------------ ------------ CASH FLOW FROM (USED IN) FINANCING ACTIVITIES: Net proceeds on sale of common shares (1,974) 314,006 Proceeds from demand loans 7,469,141 5,977,079 Repayments on demand loans (417,340) (2,199,696) Financing costs paid (832,998) (557,324) ------------ ------------ 6,216,829 3,534,065 ------------ ------------ CASH FLOW FROM (USED IN) INVESTING ACTIVITIES: Advance on note receivable - (196,575) Additions to computer systems and office equipment (66,256) (66,230) Business acquisitions (Note 4) (8,157,225) (4,611,292) ------------ ------------ (8,223,481) (4,874,097) ------------ ------------ EFFECT OF FOREIGN EXCHANGE 258,939 10,182 ------------ ------------ INCREASE (DECREASE)IN CASH DURING THE YEAR (1,587,719) (1,729,745) CASH AND CASH EQUIVALENTS, beginning of year 1,989,663 3,719,408 ------------ ------------ CASH AND CASH EQUIVALENTS, end of year $ 401,944 1,989,663 ------------ ------------ CASH AND CASH EQUIVALENTS is comprised of Cash $ 401,944 $ 679,006 Term deposits $ - $ 1,310,657 ============ ============ $ 401,944 $ 1,989,663 ============ ============ SUPPLEMENTAL CASH FLOW INFORMATION Income taxes paid $ - $ - Interest paid $ 1,390,222 $ 382,766 ============ ============

Vinciguerra Schuneman Total ----------- ---------- ----------- Customer accounts $ 1,855,983 $ 227,906 $ 2,083,889 Computer systems and equipment 64,390 36,759 101,149 Non-competition agreements 160,975 34,308 195,283 Goodwill 6,978,094 823,504 7,801,598 Other 6,439 - 6,439 Liabilities assumed (87,527) - (87,527) ----------- ---------- ----------- $ 8,978,354 $1,122,477 $10,100,831 =========== ========== ===========

Vista John's Total ----------- ----------- ---------- Customer accounts $ 2,481,432 $ 1,372,120 $3,853,552 Computer systems and office equipment 136,706 45,941 182,647 Non-competition agreements 523,992 179,826 703,818 Goodwill 3,038,638 885,122 3,923,760 Obligation under capital lease (63,135) - (63,135) ----------- ----------- ---------- $ 6,117,633 $ 2,483,009 $8,600,642 =========== =========== ==========

2005 -------------------------------------- Accumulated Cost depreciation Net ---------- ------------ ---------- Computer equipment and software $ 885,741 $ 654,360 $ 231,381 Furniture and equipment 398,481 230,420 168,061 Corporate website 9,245 9,245 - ---------- ------------ ---------- $1,293,467 $ 894,025 $ 399,442 ========== ============ ==========

2004 -------------------------------------- Accumulated Cost depreciation Net ---------- ------------ ---------- Computer equipment and software $ 805,876 $ 569,390 $ 236,486 Furniture and equipment 334,434 195,920 138,514 Corporate website 9,245 7,705 1,540 ---------- ------------ ---------- $1,149,555 $ 773,015 $ 376,540 ========== ============ ==========

2005 2004 ----------- ------------ Cost $ 8,719,481 $ 7,069,520 Accumulated amortization (3,040,982) (2,042,119) ----------- ------------ $ 5,678,499 $ 5,027,401 =========== ============

2005 2004 ---------- --------- Cost $ - $ 476,727 Accumulated amortization - (2,280) ---------- --------- $ - $ 474,447 ========== =========

2005 2004 --------- ----------- Cost $ 830,300 $ 703,818 Accumulated amortization (124,410) (40,267) --------- ----------- $ 705,890 $ 663,551 ========= ===========

2005 2004 ----------- ------------ Due on demand (U.S.$ 3,500,000) with interest at the prime rate of interest plus 8% per annum, with interest only payments until March 24, 2005 and then repayable in monthly payments of approximately $ 95,000 including principal and interest, due on March 22, 2011 and collateralized by a pledge of all assets of the Company and cash held in escrow. $ 4,233,600 $ 4,586,749 Cash held in escrow (U.S.$ 500,000) (609,306) (655,274) ----------- ------------ 3,624,294 3,931,475 =========== ============ Due on demand (U.S.$ 2,901,558) with interest at the prime rate of interest plus 2% per annum, with interest only payments until June 14, 2006 and then repayable in monthly payments of $ 103,446 including principal and interest, due on June 14, 2009 and collateralized by a pledge of all assets of the Company. 3,509,728 - ----------- ------------ Note payable (U.S.$ 3,250,000) with interest at 14% per annum, with interest only payments, due on August 31, 2008 and collateralized by a pledge of certain assets of the Company. 3,931,200 - ----------- ------------ Note payable without interest, repaid on December 31, 2004. - 228,969 ----------- ------------ Note payable (U.S.$ 900,497) with interest at 7% per annum and repayable in monthly payments of $ 23,951 including principal and interest, due on August 31, 2009 and collateralized by a pledge of certain assets of the Company. 1,089,241 - ----------- ------------ Note payable (U.S.$ 1,155,000) with interest at 8% per annum and repayable in monthly payments of $ 28,328 including principal and interest, that do not begin until January 1, 2008, due on December 31, 2012 and collateralized by a pledge of certain assets of the Company. 1,397,088 - ----------- ------------ Note payable (U.S.$ 3,284,982) to a trust of which an officer of the Company's subsidiary is a trustee, with interest at 7% per annum and repayable in monthly payments of $ 49,366 including principal and interest, due on September 30, 2013 and collateralized by a pledge of certain assets of the Company. No payments have been made since August 2004 as the lending agreement provides for secession of payments based on available working capital. 3,973,513 4,444,379 ----------- ------------ Unamortized discount provided at 12% market rate - (823,484) of interest ----------- ------------ 3,973,513 3,620,895 ----------- ------------ Long-term portion 17,525,064 7,781,339 - (7,318,804) ----------- ------------ $17,525,064 $ 462,535 ----------- ------------

2005 2004 ---------- ---------- Obligation under capital lease, bearing interest at 9.78% per annum and secured by the assets under lease $ 12,444 $ 17,624 Obligation under capital lease, bearing interest at 15% per annum and secured by the assets under lease 27,522 45,254 ---------- ---------- 39,966 62,878 Current portion (20,735) (22,912) ---------- ---------- $ 19,231 $ 39,966 ========== ==========

2005 2004 ----------------------- ----------------------- SHARES AMOUNT SHARES AMOUNT ---------- ---------- ---------- ---------- Issued Beginning of year 7,955,153 $9,897,116 7,692,055 $9,687,132 Common shares issued for private placement - - 263,098 336,765 Fair value of stock purchase warrants - - - (104,022) Share issue costs - (1,974) - (22,759) --------- ---------- --------- ---------- 7,955,153 $9,895,142 7,955,153 $9,897,116 ========= ========== ========= ==========

2005 2004 --------------------- ---------------------- WEIGHTED WEIGHTED AVERAGE AVERAGE NUMBER EXERCISE NUMBER EXERCISE OF OPTIONS PRICE OF OPTIONS PRICE ---------- --------- ----------- --------- Outstanding, beginning of year 1,308,811 $ 1.23 984,400 $ 1.37 Awarded 520,000 1.10 334,411 0.82 Cancelled (4,000) (1.00) (10,000) (1.00) Expired (534,400) (1.69) - - --------- --------- --------- --------- Outstanding, end of year 1,290,411 $ 1.00 1,308,811 $ 1.23 ========= ========= ========= ========= Exercisable, end of year 1,277,411 $ 1.00 1,244,611 $ 1.25 ========= ========= ========= =========

WEIGHTED NUMBER AVERAGE WEIGHTED NUMBER WEIGHTED RANGE OF OUTSTANDING REMAINING AVERAGE EXERCISABLE AVERAGE EXERCISE AT MARCH 31, CONTRACTUAL EXERCISE AT MARCH 31, EXERCISE EXPIRY PRICES 2005 LIFE PRICE 2005 PRICE -------- -------- ------------ ----------- -------- ------------ --------- 10/26/06 $ 1.00 431,000 1.58 $ 1.00 420,500 $ 1.00 03/18/07 1.15 5,000 1.96 1.15 2,500 1.15 08/29/08 0.81 319,411 3.42 0.81 319,411 0.81 08/29/08 1.00 15,000 3.42 1.00 15,000 1.00 08/05/09 1.10 505,000 4.33 1.10 505,000 1.10 08/16/09 1.25 15,000 4.33 1.25 15,000 1.25 -------- -------- --------- ---- -------- --------- --------- $0.81 to $1.25 1,290,411 3.17 $ 1.00 1,277,411 $ 1.00 ========= ======== ========== ==== ======== ========= =========

2005 2004 ------- ------- Risk-free interest rate 2.6% 2.6% Estimated volatility 93% 64% Expected lives 5 years 5 years

2005 2004 ----------- ---------- Expected tax expense (recovery) $(1,501,971) $ (385,059) Effect of income tax rate changes on future income taxes - (5,924) Non-deductible impairment of debt discounts 480,031 - Net non-deductible portion of financing costs 417,148 - Net unrecognized benefit of loss carryforwards 999,558 287,449 Non-deductible stock-based compensation 138,188 - Net effect of deductible goodwill and intangibles (377,163) - Other (4,611) (8,644) ----------- ---------- $ 151,180 $ (112,178) ----------- ----------

2005 2004 ---------- ---------- FUTURE INCOME TAX ASSETS Customer accounts, with tax basis $ 199,478 $ 38,990 Share issue costs - 40,690 Other assets 33,067 55 Non capital losses 1,326,180 502,038 Computer systems and office equipment - 1,633 Valuation allowance (1,279,658) (352,141) ---------- ---------- 279,067 231,265 ---------- ---------- FUTURE INCOME TAX LIABILITIES Goodwill (255,038) (42,519) Customer accounts, without tax basis (340,939) (418,353) ---------- ---------- (595,977) (460,872) ---------- ---------- NET FUTURE INCOME TAX LIABILITY $ (316,910) $ (229,607) ========== ==========

2005 2004 ---------- ---------- CANADIAN OPERATIONS Interest and financing costs on Paragon term loan repaid $ - $ 274,866 Interest on obligations under capital lease 1,410 1,701 ---------- ---------- 1,410 276,567 ========== ========== U.S. OPERATIONS Amortization of discount on reclassified long-term debt 166,489 62,625 Interest and loan fees on long-term debt 1,596,851 186,520 Amortization of financing costs 230,199 412,887 Impairment of discount on reclassified long-term debt 1,428,664 - Impairment of deferred financing costs on reclassified long-term debt 1,111,033 - Interest on obligations under capital lease 4,622 2,554 ---------- ---------- 4,537,858 664,586 ---------- ---------- $4,539,268 $ 941,153 ========== ==========

Twelve months ended Twelve months ended March 31, 2005 March 31, 2004 ------------------------------------------ ------------------------------------------ Operating Segments Canada US Consolidated Canada US Consolidated ---------------------- ------------ ------------ ------------ ------------ ------------ ------------ Revenue $ 5,189,302 $ 7,871,042 $ 13,060,344 $ 5,489,636 $ 1,979,923 $ 7,469,559 Net earnings (70,047) (4,400,107) (4,470,154) (189,146) (862,352) (1,051,498) Identifiable assets 4,198,839 17,663,500 21,862,339 5,490,449 10,718,636 16,209,085 Additions to: Computer systems and office equipment 7,755 58,501 66,256 21,797 44,433 66,230 Goodwill (Note 4) - 7,801,598 7,801,598 - 3,923,760 3,923,760 Depreciation and amortization 266,328 1,037,539 1,303,867 284,211 196,814 481,025 Interest and financing costs 1,410 4,537,858 4,539,268 276,567 664,586 941,153 Computer systems and office equipment and goodwill 1,705,067 11,219,709 12,924,776 1,745,839 4,089,886 5,835,725

Years ended March 31, 2005 2004 2003 2002 2001 ----------------------------------------- ------------ ------------ ---------- ---------- ----------- OPERATIONS Revenue $ 13,060,344 7,469,559 5,175,072 4,449,628 3,894,115 Earnings before interest, taxes, depreciation and amortization (EBITDA) 1,524,161 258,502 552,778 445,029 251,034 Interest and financing costs (4,539,268) (941,153) (285,720) (9,540) (9,614) Depreciation and amortization (1,303,867) (481,025) (609,546) (343,172) (255,778) Income Taxes (151,180) 112,178 (13,313) (10,830) 79,369 Net (Loss) Earnings $ (4,470,154) (1,051,498) (355,801) 81,487 65,011 ------------ ------------ ---------- ---------- ----------- Earnings (Loss) Per Share $ (0.56) (0.14) (0.05) 0.01 0.01 FINANCIAL POSITION Current Assets $ 2,331,734 3,971,386 4,972,921 5,059,540 5,143,318 Computer Systems and office equipment 399,442 376,540 212,265 522,085 575,622 Customer Accounts Cost 8,719,481 7,069,520 3,215,968 4,964,654 4,279,148 Accumulated Amortization (3,040,982) (2,042,119) (1,653,901) (1,879,645) (1,692,294) ------------ ------------ ---------- ---------- ----------- 5,678,499 5,027,401 1,562,067 3,085,009 2,586,854 Goodwill 12,525,334 5,459,185 1,574,832 - - Non-competition agreements 705,890 663,551 - - - Deferred financing costs - 474,447 340,193 - - Total Assets $ 21,862,339 16,209,085 8,662,278 8,666,634 8,305,794 ------------ ------------ ---------- ---------- ----------- Current Liabilities $ 19,117,229 2,122,611 1,062,058 796,074 751,724 Long Term Debt - 7,318,804 17,624 118,548 13,105 Future Income Taxes 316,910 229,607 346,162 734,661 359,405 Shareholders' Equity 2,408,969 6,498,097 7,236,434 7,017,351 7,181,560 Total Liabilities and Shareholders' Equity $ 21,862,339 16,209,085 8,662,278 8,666,634 8,305,794 ------------ ------------ ---------- ---------- ----------- Cash and cash equivalents, end of year $ 401,944 1,989,663 3,719,408 3,777,087 4,125,564 SHAREHOLDER INFORMATION Common Shares Outstanding at year end 7,955,153 7,955,153 7,692,055 7,692,055 7,725,455

AUDITORS, REGISTRAR AND HEAD OFFICE TRANSFER AGENT Suite 355, 10333 Southport Rd. SW Calgary, Alberta, Canada, D&H Group LLP T2W 3X6 10th Floor, 1333 West Broadway Telephone: (403) 278-8811 Vancouver, BC Fax: (403) 225-5745 V6H 4CI www.anthonyclk.com www.dhgroup.ca INVESTOR RELATIONS The transfer agent and registrar for the Shares is Press Contacts - North America The CIBC Mellon Trust Company, Barry Kaplan 600, 333 - 7th Avenue, S.W., Barry Kaplan Associates, Calgary, Alberta, T2P 2ZI. New Jersey Telephone: (732) 747-0702 LEGAL COUNSEL Email: smallkap@aol.com Axium Law Group Anthony Clark International Insurance Vancouver, British Columbia Brokers Ltd. Mr. Tony Consalvo, C.O.O. Demiantschuk Milley Burke & Hoffinger Telephone: (403) 225-5100 Calgary, Alberta Email: tony.consalvo@aclarkinsurance.com INVESTMENT BANKER TRADING SYMBOLS GVC Financial Services, LLC California, USA Toronto Stock Exchange:ACL Nasdaq OTCBB:ACKBF

Name, Position, Principal Occupation and, IF NOT Province or State, and at Present an ELECTED Director, Previous Service Number of Country of Residence(1) Occupation During the Past 5 Years(1) as a Director Shares(2) ---------------------------------- ----------------------------------------------- ------------------ --------- PRIMO PODORIESZACH President of the Company. April 1, 1996 468,630 President, Chief Executive Officer and Director British Columbia, Canada TONY CONSALVO Chief Operating Officer of the Company. April 1, 1996 339,179 Chief Operating Officer and Director Alberta, Canada JOSEPH P. GIUFFRE Lawyer, Partner, Axium Law Group. February 9, 2000 25,000 Corporate Secretary and Director British Columbia, Canada THOMAS E. MILLEY(4) Lawyer, Partner with the law firm Demiantschuk, June 30, 1999 1,700 Director Milley, Burke & Hoffinger. Alberta, Canada DOUGLAS FARMER(3)(4) Branch Manager, First National Financial Corp. September 24, 1998 47,500 Director Alberta, Canada NORMAND COURNOYER(3) Independent Insurance Consultant August 16, 2004 Nil Director Alberta, Canada

Annual Compensation Long Term Compensation -------------------------------------- -------------------------------- Awards Pay-outs ---------------------- -------- Securities Restricted Other Under Shares or All Name and Annual Options/ Restricted Other Principal Compen- SARs Share LTIP Compen- Position Year(1) Salary Bonus sation granted Units Pay-outs sation ($) ($) ($) (#) ($) ($) ($) ---------------- ------- -------- ------- ---------- ---------- ---------- -------- ------- Primo 2005 $100,000 Nil Nil 358,837/0 N/A N/A Nil Podorieszach 2004 $100,000 Nil Nil 143,837/0 N/A N/A Nil President 2003 $100,000 Nil Nil Nil N/A N/A Nil & Chief Executive Officer Shelley Samec 2005 $ 7,083 Nil Nil 20,000/0 N/A N/A Nil Chief Financial 2004 $ 77,917 Nil $5,855(2) 13,017/0 N/A N/A Nil Officer(3) 2003 $ 85,000 $12,500 -- Nil N/A N/A Nil Mahesh Bhatia 2005 $ 48,750 $ 7,500 Nil Nil N/A N/A Nil Interim Chief Financial Officer(4)

MARKET VALUE OF SECURITIES SECURITIES % OF TOTAL UNDERLYING UNDER OPTIONS GRANTED EXERCISE OR OPTIONS/SAR'S ON OPTIONS/SAR'S TO EMPLOYEES IN BASE PRICE DATE OF GRANT EXPIRATION NAME GRANTED (#) FISCAL YEAR (1) ($/SECURITY) ($/SECURITY DATE ------------------ ------------- --------------- ------------ ---------------- ----------- Primo Podorieszach 358,837 69% $1.10 $1.10 August 5/09 Shelley Samec 20,000 3.8% $1.10 $1.10 August 5/09 Mahesh Bhatia Nil N/A N/A N/A N/A

Value of Unexercised Unexercised Options In-the-Money Options at Fiscal Year-End at Fiscal Year-End Securities Aggregate (#)(1) ($)(1)(2)(3) Acquired on Value Exercise Realized Exercisable/ Exercisable/ Name (#) ($) Unexercisable Unexercisable ------------------ ----------- --------- ------------------- -------------------- Primo Podorieszach Nil Nil 527,674/Nil Nil/Nil Shelley Samec Nil Nil 88,017/Nil Nil/Nil Mahesh Bhatia Nil Nil N/A N/A

March 31 2000 2001 2002 2003 2004 2005 Company $100.00 $47.20 $ 9.68 $ 7.60 $10.80 $ 6.40 TSX Composite Index $100.00 $81.39 $85.36 $70.33 $96.87 $110.37

Market Value of % of Total Securities Options/SARs Underlying Securities Under Granted to Exercise or Base Options/SARs on Options/SARs Employees in Price the Date of Grant Name Granted (1) Fiscal Year (2) ($/Security) ($/Security) (3) Expiration Date ------------------- ---------------- --------------- ---------------- ----------------- --------------- Directors who are 126,163 24% $1.10 $1.10 August 5/09 not Named Executive Officers 15,000 2.9% $1.25 $1.25 August 16/09

Unexercised Value of Unexercised Options/SARs at Fiscal In-the-Money Options/ Year-End SARs at Fiscal Year-End Securities Aggregate (#)(1) ($)(1)(2)(3) Acquired on Value Exercise Realized Exercisable/ Exercisable/ Name (#) ($) Unexercisable Unexercisable ------------------------ ----------- --------- ---------------------- ----------------------- Directors who are not Named Executive Officers Nil N/A 548,720/Nil Nil/Nil

Number of securities remaining available for Number of securities to Weighted-average future issuance under equity be issued upon exercise exercise price of compensation plans of outstanding options, outstanding options, (excluding securities warrants and rights warrants and rights reflected in column (a)) ----------------------- -------------------- ---------------------------- Plan Category (a) (b) (c) ----------------------------- ----------------------- -------------------- ---------------------------- Equity compensation plans 1,290,411 $1.00 10% of the issued and approved by securityholders outstanding common shares of the Company less the number of outstanding options Equity compensation plans not N/A N/A N/A approved by securityholders TOTAL 1,290,411

TSX CORPORATE GOVERNANCE GUIDELINES THE COMPANY'S APPROACH 1. The board should explicitly assume responsibility for The board of directors is responsible for supervising stewardship of the Company and, as part of the overall the management of the Company's business and the stewardship, assume responsibility for: conduct of the Company's affairs generally. The board actively participates in strategic planning and is (a) adoption of a strategic planning process responsible for reviewing and approving the Company's operating plans as presented by management. (b) identification of principal risks and implementation of appropriate systems to manage those risks The Board also takes responsibility for identifying the principal risks of the Company's business and for (c) succession planning, including appointing, training ensuring these risks are effectively monitored and and monitoring management mitigated to the extent practicable. (d) a communications policy Succession planning, including the recruitment, supervision, compensation and performance assessment of (e) the integrity of internal control and management the Company's senior management personnel also falls information systems within the ambit of the board's responsibilities. The Company does not have a written communications policy but adheres to all regulatory requirements with respect to the timeliness and content of its disclosure. In keeping with its overall responsibility for the stewardship of the Company, the board is responsible for the integrity of the Company's internal control and management information systems. 2. The board should be constituted with a majority of Two of the Company's seven directors are members of individuals who qualify as unrelated directors. An management, five directors are outside directors (not unrelated director is a director who is independent of members of management) and three of which are management and is free from any interest and any business unrelated. If management's nominees are elected as or other relationship which could, or could reasonably be directors, two directors will be members of management, perceived to, materially interfere with the director's four directors will be outside directors of which two ability to act with a view to the best interests of the directors will be unrelated. Company. 3. The board is required to disclose on an annual basis The board currently consists of three unrelated whether the board has a majority of unrelated directors directors for the purposes of the Guidelines. Of the and the analysis of the application of the principles seven individuals on the Board, the related directors supporting this conclusion. are Mr. Primo Podorieszach, who is the President of the Company, Mr. Tony Consalvo who is the Chief Operating Officer of the Company, Mr. Joseph Giuffre who is the Secretary and a legal advisor of the Company and Mr. Thomas Milley who is a legal advisor of the Company. The unrelated directors are free of any interest (other than shareholding), business or other relationship which could, or could reasonably be perceived to, materially interfere with his ability to act with a view to the best interests of the Company.

TSX CORPORATE GOVERNANCE GUIDELINES THE COMPANY'S APPROACH 4. The board should appoint a committee, the majority of Given the stage of development of the Company, the whom are unrelated directors, with responsibility for functions of such a committee are best served by the proposing new nominees to the board and assessing board as a whole. directors. 5. Every board should implement a process for assessing The board is of the view that the Company's the effectiveness of the board as a whole, the board's shareholders are the most important assessors of board committees and individual directors. performance and that they provide the most effective, objective assessment of the board's performance. 6. Every Company should provide an orientation and The Company does not provide a formal orientation and education program for new recruits to the board. education program for new directors but provides new directors with an information package concerning the Company, director responsibility and director liabilities. New directors will also be given an opportunity to familiarize themselves with the Company, the current directors and members of management. 7. Every board should examine its size and, where The Board considers its size, in light of the Company's appropriate, undertake a program to reduce the number of stage of development, to be appropriate. directors. 8. The board should review the compensation of directors The Company has established a Compensation Committee to to ensure it adequately reflects the responsibilities and review the compensation paid to directors. risks involved in being an effective director. 9. Committees of the board should generally be composed The current committees of the board consist of an Audit of outside directors, a majority of whom are unrelated Committee and a Compensation Committee, all the members directors. are unrelated directors. The Audit Committee currently consists of three unrelated directors. The role of the Audit Committee is to oversee the Company's financial reporting obligations, financial systems and disclosure and to act as a liaison between the board and the Company's auditors. The activities of the Audit Committee typically include reviewing quarterly and annual financial statements, ensuring that internal controls over accounting and financial systems are maintained and that accurate financial information is disseminated to shareholders, reviewing the results of internal and external audits and any change in accounting procedures or policies, and evaluating the performance of the Company's auditors. The Compensation Committee currently consists of two outside directors, one of whom is related. The role of the Compensation Committee is primarily to administer the Company's Stock Option Plan and to determine the remuneration of executive officers.

TSX CORPORATE GOVERNANCE GUIDELINES THE COMPANY'S APPROACH 10. Every board should expressly assume responsibility The entire board is responsible for developing and for, or assign to a committee, the general responsibility implementing the Company's approach to governance for, developing the Company's approach to governance issues. issues. 11. The board, together with the CEO, should develop The board and the CEO have not, to date, developed position descriptions for the board and for the CEO, formal, documented position descriptions for the Board involving the definition of the limits to management's and the CEO defining the limits of management's responsibilities. In addition, the board should approve responsibilities. The board is currently of the view or develop the corporate objective which the CEO is that the respective corporate governance roles of the responsible for meeting. board and management, as represented by the CEO, are clear and that the limits to management's responsibility and authority are reasonably well-defined. The board is responsible for approving long-term strategic plans and annual operating plans recommended by management. Board consideration and approval is also required for all material contracts and business transactions and all debt and equity financing proposals. The board is also responsible for senior executive recruitment and compensation. The board delegates to management, through the CEO, responsibility for meeting defined corporate objectives, implementing approved strategic and operating plans, carrying on the Company's business in the ordinary course, managing the Company's finances, evaluating new business opportunities, recruiting staff and complying with applicable regulatory requirements. The Board also looks to management to furnish recommendations respecting corporate objectives, long-term strategic plans and annual operating plans. 12. Every board should have in place appropriate The board believes the Company is well served and the structures and procedures to ensure that the board can independence of the board from management is not function independently of management. compromised. The board does not have, and does not consider it necessary under the circumstances to have, any formal structures or procedures in place to ensure that the board can function independently of management. If all management nominees are elected as directors of the Company, only two of six directors will be members of management to ensure continued independence on the Board of Directors.

TSX CORPORATE GOVERNANCE GUIDELINES THE COMPANY'S APPROACH 13. The audit committee of every board of directors The members of the Audit Committee are unrelated. If should be composed of only outside directors. The roles all of management's nominees are appointed, its Audit and responsibilities of the audit committee should be Committee will be composed of two outside unrelated specifically defined. directors and one related director until such time as an additional unrelated director is elected or appointed and who becomes a member of the Audit Committee. The role of the Audit Committee is described in Item 9 above. 14. The board of directors should implement a system Each member of the board understands that he/she is which enables an individual director to engage an outside entitled to seek the advice of an independent expert at advisor at the expense of the Company. the expense of the Company if he/she considers it warranted under the circumstances.

AUDIT RELATED FISCAL YEAR END AUDIT FEES FEES(1) TAX FEES(2) ALL OTHER FEES(3) --------------- ---------- ------------- ----------- ----------------- 2005 $ 111,782 $ 25,000 $15,182 $59,308 2004 $ 55,000 $ 14,975 $35,079 Nil

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