Widecom Group Inc – ‘SB-2/A’ on 12/29/99

On:  Wednesday, 12/29/99   ·   Accession #:  910647-99-318   ·   File #:  333-89109

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Pre-Effective Amendment to Registration of Securities by a Small-Business Issuer   —   Form SB-2
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: SB-2/A      Amendment No. 1 to SB-2/A                             86±   328K 
 2: EX-10       Exhibit 10.4                                           3±    11K 
 3: EX-23       Exhibit 23.1                                           1      6K 

SB-2/A   —   Amendment No. 1 to SB-2/A
Document Table of Contents

As filed with the Securities and Exchange Commission on December 28, 1999   
                                                            File No. 333-89109

SECURITIES AND EXCHANGE COMMISSION    
WASHINGTON, D.C. 20549    

--------------------    

FORM SB-2/A   

FIRST AMENDMENT TO    

REGISTRATION STATEMENT    
UNDER   
THE SECURITIES ACT OF 1933    

--------------------    

THE WIDECOM GROUP, INC.   
(Exact name of Registrant as specified in its charter)    

Ontario, Canada                 3669                       98-0139939   
(State of Incorporation)      (Primary Standard             (I.R.S. Employer    
                       Industrial Classification No.)   Identification Number)

--------------------    

72 Devon Road, Unit # 18    
Brampton, Ontario   
Canada, L6T 5B4   
(905) 712-0505    

(Address, including zip code, and telephone number,   
including area code, of Widecom's principal executive offices)    

Suneet S. Tuli, Executive Vice President    
c/o The Corporation Trust Company   
1633 Broadway, New York, New York  10019    
(905) 712-0505    
(Name and address, including zip code, and telephone number,    
including area code, of agent for service)    

--------------------    

With copies to:   

Victor J. DiGioia, Esq.   
Michael A. Goldstein, Esq.    
Goldstein & DiGioia, LLP    

369 Lexington Avenue    
New York, New York 10017    
Telephone (212) 599-3322    
Facsimile (212) 557-0295    

Approximate date of commencement of proposed sale to the public:  As
soon as practicable after the effective date of this Registration               
Statement.                                                                      

If this Form is filed to register additional securities for an      
offering pursuant to Rule 462(b) under the Securities Act, please check the     
following box and list the Securities Act registration statement number of      
the earlier effective registration statement for the same offering.  [ ]        

If this Form is a post-effective amendment filed pursuant to Rule   
462(c) under the Securities Act, check the following box and list               
the Securities Act registration statement number of the earlier effective       
registration statement for the same offering.  [ ]                              

If this Form is a post-effective amendment filed pursuant to Rule   
462(d) under the Securities Act, check the following box and list the           
Securities Act registration statement number of the earlier effective           
registration statement for the same offering.  [ ]                              

 If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box.  [ ]                                       

CALCULATION OF REGISTRATION FEE(1)    

                                                        [Enlarge/Download Table]

Title of Shares to be Registered    Amount to be    Proposed              Proposed             Amount of   
                                    Registered      Maximum               Maximum              Registration
                                                    Offering Price per    Aggregate            Fee         
                                                    Share(2)              Offering Price(2)                
-----------------------------------------------------------------------------------------------------------

                                                                                                           
Common Stock, par value $.01(3)       538,441         $6.0625               $3,264,298.56       $  907.47  

Common Stock, par value $.01          451,000         $6.0625               $2,734,187.50       $  760.11  

Common Stock, par value $.01(3)        50,000         $6.0625               $  303,125.00       $   84.27  

Total                               1,039,441                               $6,301,611.06       $1,751.85  
                                    =====================================================================  
<FN>                                                                                                       

<F1>  This registration statement on Form SB-2 is being filed pursuant to                                  
      Rule 429 under the Securities Act of 1933, as amended. 82,500 shares                                 
      of common stock underlying underwriters' warrants, and 167,500 shares                                
      of common stock underlying privately issued warrants were previously                                 
      registered, and a fee of $2,648.71 was previously paid, under our                                    
      registration statement on Form F-1, No. 333-78004, which is hereby                                   
      combined with this registration statement under Rule 429.                                            

<F2>  Total estimated solely for the purpose of determining the                                            
      registration fee.  Based upon the closing bid price of Widecom's                                     
      stock on the Nasdaq Small Cap Market on October 11, 1999 ($6.0625).                                  

<F3>  Represents shares of common stock issuable upon exercise of                                          
      outstanding common stock purchase warrants and convertible notes held                                
      by certain security holders as they relate to stock splits,                                          
      recapitalizations and the like. Pursuant to Rule 416 of the Securities                               
      Act of 1933, as amended (the "Act"), there are being registered such                                 
     additional number of shares of common stock as may become issuable                                    
      pursuant to the anti-dilution provisions of the warrants.                                            

</FN>                                                                                                      

EXPLANATORY NOTE    

The purpose of this registration statement on Form SB-2 of The      
Widecom Group, Inc. is to register an additional 1,039,441 shares of our        
common stock, par value $.01 per share.  An additional 82,500 shares of         
common stock underlying common stock purchase warrants issued to our            
underwriters in our initial public offering and 167,500 shares of common        
stock underlying privately issued common stock purchase warrants were           
previously registered under our registration statement on Form F-1, No. 33-     
78004, which is hereby combined with this registration statement under Rule     
429 under the Securities Act.                                                   

Widecom hereby amends this registration statement on such date or   
dates as may be necessary to delay its effective date until Widecom shall       
file a further amendment which specifically states that this registration       
statement shall thereafter become effective in accordance with Section 8(a)     
of the Securities Act of 1933 or until the registration statement shall         
become effective on such date as the Commission may determine under Section     
8(a).                                                                           

P R O S P E C T U S                                                             

1,289,441 Shares    

THE WIDECOM GROUP INC.    

Common Stock    

This prospectus covers an aggregate of 1,289,441 shares of common   
stock, par value $.01, of The Widecom Group Inc., including:                    

*  232,441 shares issuable upon exercise of 929,764 outstanding common          
stock purchase warrants which were originally sold as part of Widecom's         
initial public offering;                                                        

*  82,500 shares underlying warrants issued to the underwriter of               
Widecom's initial public offering;                                              

*  473,500 shares underlying privately issued common stock purchase             
warrants;                                                                       

*  50,000 shares of common stock issuable upon conversion of $200,000           
principal amount of convertible notes; and                                      

*  451,000 Shares held by certain selling shareholders.                         

Widecom will not receive any of the proceeds from the sale of the   
shares by the selling shareholders.                                             

Widecom's common stock is traded in the over-the counter market and 
is quoted on the Nasdaq Small Cap Market under the symbol "WIDE" and on the     
Boston Stock Exchange under the symbol "WDE". On ____________, 1999, the        
closing bid and asked prices for the common stock as reported on Nasdaq         
were $___ and $___, respectively.                                               

THESE SECURITIES INVOLVE A HIGH DEGREE OF RISK.   
SEE "RISK FACTORS" PAGE 4 OF THIS PROSPECTUS    

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE       
SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE       
ACCURACY OR ADEQUACY OF THIS PROSPECTUS.  ANY REPRESENTATION TO THE             
CONTRARY IS A CRIMINAL OFFENSE.                                                 

THESE SECURITIES ARE OFFERED FOR SALE IN THE STATE OF MARYLAND      
PURSUANT TO REGISTRATION WITH THE DIVISION OF SECURITIES OF THE DEPARTMENT      
OF LAW OF MARYLAND, BUT REGISTRATION IS PERMISSIVE ONLY AND DOES NOT            
CONSTITUTE A FINDING THAT THIS PROSPECTUS IS TRUE, COMPLETE AND NOT             
MISLEADING, NOR HAS THE DIVISION OF SECURITIES PASSED IN ANY WAY UPON THE       
MERITS OF, RECOMMENDED, OR GIVEN APPROVAL ON THESE SECURITIES.  ANY             
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.                           

The date of this prospectus is _______, 1999    

TABLE OF CONTENTS   

                                                                          Page
                                                                          ----

PROSPECTUS SUMMARY                                                           1  

THE OFFERING                                                                 3  

RISK FACTORS                                                                 4  

ADDITIONAL INFORMATION                                                      12  

USE OF PROCEEDS                                                             13  

SELLING SECURITY HOLDERS                                                    14  

SELECTED FINANCIAL DATA                                                     17  

MANAGEMENT'S DISCUSSION AND ANALYSISOF FINANCIAL CONDITION                      
AND RESULTS OF OPERATIONS                                                   18  

DESCRIPTION OF BUSINESS                                                     24  

LEGAL PROCEEDINGS                                                           34  

DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS                36  

EXECUTIVE COMPENSATION                                                      38  

SECURITY OWNERSHIP OF CERTAIN BENEFICIALOWNERS AND MANAGEMENT               40  

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS                              41  

DESCRIPTION OF SECURITIES                                                   42  

LEGAL MATTERS AND EXPERTS                                                   46  

CHANGES IN ACCOUNTANTS                                                      47  

DISCLOSURE OF COMMISSION ON INDEMNIFICATION FOR SECURITIES ACT                  
LIABILITIES                                                                 47  

MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS                    48  

PLAN OF DISTRIBUTION                                                        49  

FORWARD LOOKING STATEMENTS                                                  50  

PROSPECTUS SUMMARY    

The following summary is intended to set forth pertinent facts and              
highlights from material contained in the body of this prospectus.  More        
detailed information is presented throughout this prospectus and the            
consolidated financial statements.  Each prospective investor is urged to       
read this prospectus in its entirety.  Unless otherwise indicated, all          
numbers have been adjusted to reflect a one-for-four (1:4) reverse stock        
split effective on January 29, 1999.                                            

THE WIDECOM GROUP   

The Widecom Group Inc. was incorporated in Ontario, Canada in June 1990. We     
design, assemble and recently commenced marketing of high-speed, high-          
performance document systems which transmit, receive, print, copy and/or        
archive wide format documents, such as blueprints, schematics, newspaper        
layouts and other mechanical and engineering drawings.                          

Our Products                                                                    

In developing and marketing wide-format document systems, we currently          
market four main product lines:                                                 

*  Two types of 36-inch document scanners;                                      

*  One 72-inch document scanner; and                                            

*  One 36-inch Plotter/Printer.                                                 

Our Approach to the Market                                                      

Our primary marketing strategy is to sell our products to targeted              
commercial markets that we believe have potential for significant uses of       
wide format document systems.  Our target markets are principally               
architectural, engineering and construction firms.  We believe that the         
reproduction, archiving and transmission of wide format documents are           
essential to those businesses.  We also market our products for use by          
manufacturers in the garment, woodworking and graphic arts industries,          
utilities, government agencies and the newspaper and advertising                
industries.  We believe that our products are used by consumers in these        
markets for a variety of uses, including the transmission of construction       
plans, architectural drawings, newspaper and advertising layouts and            
clothing patterns.  In general, we believe that users of wide format            
documents have an increasing need for systems which can more efficiently        
scan, copy, print, transmit, receive and archive wide format documents.         

About Widecom                                                                   

Our executive offices are located at 72 Devon Road, Unit 18, Brampton,          
Ontario, Canada L6T 5B4.  Our telephone number is (905) 712-0505.               

Recent Developments                                                             

We have recently agreed to convert outstanding debentures held by Global        
Bermuda, L.P.  These debentures came due on May 19, 1998 and have been in       
default.  Pursuant to an agreement with the holder, dated December 12, 1999     
we agreed to convert the outstanding balance payable of $181,134.25 into        
21,310 shares of common stock and a release.  The shares issued upon            
conversion are not covered by this prospectus.                                  

THE OFFERING    

                                                                [Download Table]
                                                                        
Securities Offered by Widecom          1,289,441                        

Common Stock Outstanding                                                
 Prior to Offering(1)                  2,577,351                        

Common Stock Outstanding                                                
 After the Offering(1)(2)              3,415,792                        

Nasdaq Smallcap Market Symbol                                           
(Common Stock):                        "WIDE"                           

Boston Stock Exchange Symbol                                            
(Common Stock):                        "WDE"                            

<FN>                                                                    
--------------------                                                    
<F1>  As of September 23, 1999.  Does not include:                      
      *  125,000 shares of common stock reserved for issuance under     
      Widecom's 1995 employee stock option plan, of which 114,583 shares
      have been reserved for currently outstanding options and 10,417   
      shares are available for future issuances.                        

<F2>  Assumes the exercise of all of the warrants for which underlying  
      shares are being registered hereby.                               
</FN>                                                                   

RISK FACTORS    

During our limited operating history we have not earned a profit.   
During our limited operating history we have not earned sufficient revenues     
to become profitable.  Our revenues may not increase in the future and our      
future operations may not be profitable.  In 1992 we began marketing our        
first 36" wide format facsimile machine on a limited basis, primarily for       
demonstration purposes.  We began marketing other wide format document          
systems in 1994.  We have only recently commenced commercialization of the      
full line of our products.  Therefore, we have only a limited relevant          
operating history upon which an evaluation of our prospects and performance     
can reasonably be based.                                                        

Since inception, we have generated limited revenues from operations 
and have lost money every year since 1996. For the fiscal year ended March      
31, 1998, we sustained a loss of $3,335,865.  For the fiscal year ended         
March 31, 1999, we sustained a loss of $2,244,351.  For the quarter ended       
June 30, 1999, we sustained a further loss of $89,634. The losses for these     
fiscal years would have been greater if we did not receive revenues from        
research and development grants and similar reimbursement programs from         
various Canadian government programs.  We are subject to the risks,             
expenses, delays, problems and difficulties typically encountered in the        
establishment of a new business in an industry characterized by intense         
competition.  We are also faced with similar risks in our efforts to shift      
from product development to the commercialization of our new products.          

Our common stock may be delisted from Nasdaq.  Our common stock is  
listed for trading on the Nasdaq SmallCap Market under the symbol WIDE.         
Under Nasdaq rules, in order to maintain listing of its common stock and        
warrants on the Nasdaq SmallCap Market, a company must have, among other        
things, $2,000,000 of net tangible assets or market capitalization of           
$35,000,000 or $500,000 of net income in the latest fiscal year or 2 of 3       
previous fiscal years and a minimum bid price of $1.00 per share. We            
completed a one-for-four (1:4) reverse stock split in January, 1999, to         
raise the bid price of our common stock over the minimum bid price              
requirement of $1.00, as required by the Nasdaq SmallCap Market. In             
addition, Nasdaq reserves the right to withdraw or terminate a company's        
listing on the Nasdaq SmallCap Market at any time and for any reason.           

 If delisted from Nasdaq, we will be subject to the penny stock rules.
If we are unable to maintain continued quotation on the Nasdaq Small Cap        
Market, we may be subject to additional disclosure requirements applicable      
to penny stocks under the Exchange Act Rules.  If our securities become         
subject to the Exchange Act Rules applicable to penny stocks, the market        
liquidity for our securities could be adversely affected.  Absent an            
exception, the Exchange Act Rules make it unlawful for a broker/dealer to       
sell or purchase penny stocks on behalf of any customer, other than an          
established customer of such a broker/dealer or an accredited investor.         
Further, these rules require broker/dealers to deliver a disclosure             
schedule explaining the penny stock market and the risks associated             
therewith to any potential purchaser prior to the execution of any              
transaction involving the purchase or sale of a penny stock.                    

We have made sizeable capital investments.  Our heavy investment in 
property, plant, equipment and inventories, our continuing operating losses     
and our $1,850,000 investment in Technologies NovImage have substantially       
reduced our cash position.  Additionally, the lack of product sales and         
costs incurred while developing and introducing the new Series SLC936           
Scanners have further weakened our capital position. We may need to obtain      
additional financing to continue the introduction of our new products and       
to finance research and development of further additional products. To the      
extent that any future financing involves the sale of our equity                
securities, the interests of our then existing shareholders could be            
diluted.                                                                        

We have been dependent on the sales of one product line.  A         
substantial portion of our sales have been derived from the sale of our 4-      
series scanner units since their introduction in May 1995. We have,             
however, discontinued the production of this product line.  Accordingly, we     
are faced with the risk of market acceptance of our new product lines.          
Since we have only recently introduced our new products and have not, to        
date, achieved significant sales revenue from these products, a decline in      
the sale of our scanner units would have a material adverse effect on our       
business.  For the fiscal years ended March 31, 1998 and March 31, 1999,        
sales of our 4-series scanner units accounted for approximately 78.6% and       
0%, respectively, of our product sales.  We may be dependent upon non-          
recurring sales of WIDEfax Modular Units to a limited number of customers.      
These sales could constitute a substantial portion of our revenues.             

We compete in a niche-market which limits our customer base.  The   
wide format document systems industry is a highly specialized segment of        
the document systems industry.  The market for our products may not grow,       
we may not have sufficient resources to achieve market acceptance and our       
efforts may not result in market acceptance of our products.  Market            
entrants seek to establish their products and technologies as the preferred     
method for reproducing, transmitting and storing wide format documents.  As     
is typical in the case of niche-markets, demand and market acceptance for       
newly introduced products is subject to a high level of uncertainty.            
Potential customers may elect to utilize other products which they believe      
to be more efficient or have other advantages over our products or may be       
reluctant to purchase our products due to significant capital investment in     
other wide format document systems.                                             

We depend on others to market our products which could harm our     
ability to sell our products.  We have limited marketing experience and         
limited financial, personnel and other resources to independently undertake     
extensive marketing activities.  To the extent that third party dealers and     
distributors provide inadequate service and support, over which we will not     
have direct control, our reputation, and our ability to continue to sell        
additional products could be adversely affected.  We will be dependent upon     
the efforts of our distributors and dealers and may be dependent upon a         
limited number of distributors and dealers for a significant portion of our     
revenues. For the years ended March 31, 1998, and March 31, 1999 our five       
largest distributors accounted for approximately 43% and 8%, respectively,      
of our product sales. We have only recently entered into marketing              
arrangements with many of our key distributors and dealers.  Our prospects      
will depend to a large extent upon their efforts and our ability to develop     
and maintain strategic marketing relationships with these and additional        
distributors and dealers. Some of our dealers and distributors represent        
various product lines generally, and cannot be expected to increase their       
sales efforts for our products in the absence of increased incentives or        
product. We will also be dependent upon our distributors and dealers to         
provide installation and support services.                                      

As our products have not achieved widespread use, they may not work 
with all technology. Our products may not satisfactorily perform all of the     
functions for which they have been designed nor be reliable or durable in       
extensive applications if subjected to widespread use. Although we believe      
that our current generation of wide format document scanners and plotters       
perform the principal functions for which they have been designed, our          
products have been only recently commercialized and are currently being         
utilized by only a limited number of customers.  We may be required to          
devote considerable efforts and resources to enhance and refine our wide        
format products and to develop additional products. Such efforts remain         
subject to risks during the development and commercialization phases for        
new products, including unanticipated delays, expenses, technical problems      
or difficulties, as well as the possible insufficiency of funds to              
implement efforts, which could result in abandonment or substantial change      
in product development or commercialization.                                    

Our products may not be competitive.  The markets for document      
systems are characterized by intense competition between various                
manufacturers of wide format copiers, scanners, plotters and printers.          
Widecom competes with numerous well-established foreign and domestic            
companies that market or are developing wide format document systems, as        
well as those which manufacture standard facsimile machines, copiers,           
scanners, plotters, and printers. We also expect that companies that            
manufacture and sell standard facsimile machines, copiers, plotters,            
scanners and printers could develop, without substantial delay of time,         
wide format document systems directly competitive with our products. Many       
of these companies possess substantially greater financial, technical,          
marketing, personnel and other resources than we do and have established        
reputations for success in the development and marketing of facsimile           
machines, copiers, plotters, scanners and printers and have sufficient          
budgets to permit them to implement extensive advertising and promotional       
campaigns to enter new markets.                                                 

The market for our products is characterized by rapid product       
obsolescence.  The markets for our products are characterized by rapidly        
changing technology and evolving industry standards, which may result in        
rapid product obsolescence or short product life cycles. As a result, our       
ability to compete may be dependent upon:                                       

*  our ability to continually enhance and improve our products;                 

*  to complete development of new products and introduce them into the          
marketplace in a timely manner;                                                 

*  to successfully develop and market these new products;                       

*  to keep pace with evolving technological advances in the industry;           

*  and to ensure that our products meet targeted cost and performance           
goals.                                                                          

We may not be able to compete successfully, competitors may develop 
technologies or products that render our products obsolete or less              
marketable, and we may not be able to enhance successfully our existing         
products or develop new products.  Further, Our inability to successfully       
complete development of a product or our determination not to complete          
development or commercialization of any product, particularly in instances      
in which we have already made significant capital expenditures, could have      
a material adverse effect on our business.                                      

We may not receive any additional money from government-sponsored   
programs.  Although government sponsored research grants and subsidies have     
been provided to us in the past to fund specific research programs, during      
the fiscal years ended March 31, 1998 and March 31, 1999, we did not seek       
reimbursement from the Canadian government for any expenses. In the past, a     
substantial portion of Widecom's revenues have been derived from research       
and development grants and reimbursement from the Canadian government.          
Along with a branch of the government of the Province of Quebec, we became      
equal shareholders in a research and development company named 3994340          
Canada Inc., doing business as NovImage.  The formation of NovImage enables     
us to obtain a substantial increase in the amount of research that can be       
performed at a significantly reduced cost as NovImage is entitled to            
receive grants in excess of 40% of qualified research expenditures.             
However, these grants and programs may not be continued beyond the              
immediate future. In the event of the discontinuance of any such programs,      
we may incur higher research and development and employee costs.                

Our dependence on third-party suppliers may result in delays and    
quality-control issues.  We are dependent upon third-party suppliers and        
subcontractors for our supply of custom and component parts incorporated        
into our products.  We are also dependent on the ability of our suppliers       
and subcontractors to, among other things, satisfy performance and quality      
specifications and dedicate sufficient production capacity within scheduled     
delivery times.  The failure or delay by our suppliers and subcontractors       
in supplying components or custom parts to us would adversely affect our        
operating margins and our ability to manufacture and deliver products on a      
timely and competitive basis.  We are currently dependent upon Alberta          
Microelectronics, Inc., our principal supplier of print heads.  Moreover,       
we do not maintain supply agreements with any of our suppliers or               
subcontractors and we purchase components and custom parts in the ordinary      
course of business.                                                             

Our reliance on sales to foreign countries exposes us to foreign    
trade risks.  We rely on sales to foreign markets for a substantial portion     
of our revenues.  We are and may become increasingly subject to risks of        
foreign trade, including shipping delays, increased collection risks, trade     
restrictions, export duties and tariffs, all of which could have an adverse     
effect on our operating margins and results of operations and exacerbate        
the risks of doing business.  Further, the political volatility of the          
Indian subcontinent makes us particularly vulnerable to these risks.  For       
the fiscal years ended March 31, 1998 and March 31, 1999, sales of our          
products to customers in the Middle East and Asia accounted for                 
approximately 22% and 30.4%, respectively, of our sales. We are seeking to      
expand product sales in foreign markets, but we may not be successful and       
these markets may not be viable.                                                

We may lose money on foreign currency exchange.  We conduct a       
substantial portion of our business in foreign currency, primarily the          
Canadian dollar and Indian rupee.  Disruptions in the exchange rates            
between the United States dollar and the Canadian dollar or Indian rupee        
could have an adverse effect on our operating results in the future. The        
Indian rupee has experienced significant devaluation against the United         
States dollar and other currencies in recent years. We seek, however, to        
limit our exposure to the risk of currency fluctuations by engaging in          
foreign currency transactions that could expose us to substantial risk of       
loss. Fluctuations in foreign currency exchange rates may have a                
significant impact on our future operating results.                             

Almost all of our manufacturing is performed in India and we are    
subject to Indian laws and regulations regarding these activities.              
Substantially all of our manufacturing activities are conducted in a free       
trade zone in India.  In connection therewith, we have been and will            
continue to be subject to additional risks associated with conducting           
business abroad. India may, from time to time, impose duties, tariffs or        
quotas or other restrictions on our imports or exports, or otherwise change     
regulations relating to the conduct of business in the free trade zone.         
Similarly, the United States or Canada may impose increased duties, tariffs     
and other restrictions on the import or export of our products or supplies.     
Any of these possibilities could adversely affect our operations.               

  Our operating results could vary, requiring additional capital to fund
operations.  We may need additional capital to fund operations when our         
revenues are low during any period.  Because we compete in a competitive        
niche-market with a high-rate of product obsolescence, rely on                  
third-party suppliers and distributors, and have a limited customer base,       
our operating results could significantly vary from period to period.           

Our lack of patents on all of the technology we use could harm our  
competitive position.  We hold one patent and have filed a number patent        
applications relating to different aspects of our technology.  No               
additional patents may be issued to us.  Even if additional patents are         
issued to us, the breadth or degree of protection that future patents would     
afford us may be limited.  Further, any future patents could be                 
circumvented or invalidated. We rely upon proprietary know-how and employ       
various methods to protect the ideas, concepts and documentation of our         
proprietary technology.  These methods include nondisclosure agreements         
with our employees and distributors.  These methods may not, however,           
afford complete protection.  Further, our competitors or customers may          
independently develop competitive know-how or obtain access to our know-        
how, ideas, concepts and documentation. In addition, some aspects of the        
technologies embodied in our products are generally available to other          
manufacturers.                                                                  

We are not aware of any infringement on the proprietary rights of   
others and have not received any notice of any claimed infringement. We         
have not, however, conducted any investigation as to possible infringement.     
Therefore, third parties may exist which could assert infringement claims       
against us in connection with our products.  If third parties exist, their      
claims may result in litigation and we may not prevail in any such              
litigation or be able to license any infringed patents of third parties on      
commercially reasonable terms, or at all.  If our technologies were found       
to infringe another party's rights, we could be required to modify our          
products or obtain a license. We may not be able to do so in a timely           
manner, upon acceptable terms and conditions, or at all.  Further, we may       
not have the financial or other resources necessary to successfully defend      
a claim or violation of proprietary rights. Failure to do any of the            
foregoing could have a material adverse effect on our business.                 
Furthermore, if our products or technologies are deemed to infringe patents     
or proprietary rights of others, we could, under certain circumstances,         
become liable for damages, which would have a material adverse effect on        
our business.                                                                   

We hold a registered trademark with the United State Patent and     
Trademark Office for the WIDEfax[REGISTER MARK] name only. We are not aware     
of any infringement on the proprietary rights of others and have not            
received any notice of claimed trademark infringement.  We have not,            
however, conducted any investigation as to possible trademark infringement.     
Therefore, third parties may exist which could assert trademark                 
infringement claims against us in connection with our use of any of our         
marks. If third parties exist, their claims may result in litigation and we     
may not prevail in any such litigation.                                         

The loss of certain officers would significantly harm our business. 
Our success is largely dependent on the personal efforts of Raja S. Tuli,       
our Chief Executive Officer and President, Suneet S. Tuli, our Executive        
Vice President of Sales and Marketing, and other key personnel. Although we     
have entered into five-year employment agreements with Messrs. Raja Tuli        
and Suneet Tuli, the loss of the services of such persons or other key          
employees could have a material adverse effect on our business and              
prospects. We have obtained "key-man" life insurance on the life of Raja        
Tuli in the amount of CDN $1,500,000 and on the life of Suneet Tuli in the      
amount of CDN $750,000. Our success may also be dependent upon our ability      
to hire and retain additional qualified technical, financial, marketing and     
other personnel.                                                                

We may have conflicts of interest with our affiliates.  We were     
organized by Raja, Suneet and Lakhbir Tuli.  Lakhbir Tuli is the father of      
Raja and Suneet Tuli.  We have engaged in transactions with entities that       
are affiliated with our organizers which may involve potential conflicts of     
interest. Transactions or arrangements between us and our affiliates may        
not be advantageous and conflicts of interest may arise with respect these      
transactions.  For example, Indo Widecom International Ltd., our wholly         
owned subsidiary, leases our Indian facility from Widecom Fax and Plotters,     
Ltd., a company controlled by Lakhbir S. Tuli.  We have also engaged            
Widecom Fax as a non-exclusive distributor in India on the same terms and       
conditions as unaffiliated distributors.  Moreover, we engage Lakhbir S.        
Tuli as an independent consultant and, for the fiscal years ended March 31,     
1998 and 1999, we paid him and certain companies controlled by him $159,600     
and $134,000, respectively, in consideration for such services.  Further,       
two companies in which Raja S. Tuli has a beneficial interest each acquired     
a percentage of NovImage.  If conflicts with our affiliates do arise, they      
may not be resolved entirely in our favor.                                      

 Since the Tuli family controls Widecom, other shareholders may not be
able to influence our direction.  At present, Raja, Suneet and Lakhbir          
Tuli, in the aggregate, beneficially own approximately 36.66% of Widecom's      
outstanding common stock. Accordingly, such persons, acting together, will      
most likely be in a position to control Widecom.  Therefore, they may elect     
all of our directors, increase the authorized capital, dissolve, merge, or      
sell our assets and generally direct our affairs.                               

Our outstanding options and warrants may depress our stock price.   
Additional shares issued upon outstanding options and warrants may result       
in a substantial dilution to the shares of common stock held by our other       
shareholders and depress the market price of our stock.  The exercise of        
these outstanding convertible securities may also adversely impact the          
terms upon which we will be able to obtain additional equity capital.  This     
could occur since the holders of outstanding options and warrants can be        
expected to exercise their securities at a time when we would, in all           
likelihood, be able to obtain any needed capital on terms more favorable        
to us than those provided in the outstanding options and warrants.              

As of the date of this registration statement, there were currently 
outstanding warrants to purchase 1,584,514 shares of common stock. The          
exercise prices of those warrants are as follows:                               

*     25,000 are exercisable at $8.50 per share;                    
*     15,000 are exercisable at a price of $10.00 per share;        

*     929,764 are exercisable at a price of $5.00 per share for a   
       period of 120 days from the effective date of this registration
statement and $10.00 thereafter;                        

*     192,500 are exercisable at $16.00 per share;                  
*     41,250 are exercisable at $33.00 per share;                   

*     41,250 are exercisable at $.66 per share                      

*     106,000 are exercisable at $2.00 per share;                   
*     50,000 are exercisable at $3.00 per share;                    
*     50,000 are exercisable at $1.20 per share;                    
*     25,000 are exercisable at $8.00 per share; and                
*     150,000 are exercisable at $8.00 per share but may be         
    exercisable at $2.00 per share upon the occurrence of events
specified in the warrant agreement.                     

We have the right to redeem, with the consent of the underwriters of
our initial public offering, for $.40 per warrant, 929,764 warrants             
exercisable at $5.00 per share for a period of 120 days after the effective     
date of the registration statement and $10.00 thereafter.  Although we may      
choose to do so in light of our current working capital position, heavy         
downward pressure on our stock price would likely result as warrant holders     
could exercise their warrants and sell the underlying stock to avoid            
redemption of their warrants.                                                   

Additionally, we have reserved 125,000 shares of common stock for   
issuance upon the exercise of options which may be granted under our stock      
option plan.  As of March 31, 1999, options to purchase 114,583 shares of       
common stock were outstanding with exercise prices ranging from $3.28 to        
$8.50.                                                                          

 The conversion of outstanding convertible notes may depress out stock
price.  We have issued notes which are convertible into common stock, which     
could also reduce our stock price.  There are ten convertible notes in the      
aggregate amount of $200,000 outstanding to investors in our private            
placement which closed earlier in the 1999 fiscal year.  These notes are        
convertible at the rate of $4.00 per share into a total of 50,000 shares of     
our common stock.                                                               

We have sold restricted shares which may depress our stock price and
impair our access to capital markets.  As of the date of this registration      
statement, Widecom has 2,543,541 shares of common stock outstanding.  Of        
the outstanding shares, 1,066,230 shares are restricted securities under        
the Securities Act which may only be sold under an effective registration       
statement under the Securities Act, or in reliance on the exemption             
provisions of Rule 144 or another exemption under the Act.  An additional       
114,583 shares of common stock which are issuable upon exercise of certain      
options, will also be restricted securities and, absent an exception, may       
not be sold without being registered under the Securities Act.  You may not     
be able to sell these restricted securities.  Even if you are able to sell      
these restricted securities, the sales of these shares, or even the             
availability of those shares for sale, may have a depressive effect on the      
market prices of our common stock.  Further, this may impair our ability to     
raise capital through the sale of additional equity securities.                 

 Since we have not paid dividends, you cannot expect to receive income
from this investment. We have never declared a dividend on our common           
stock.  We anticipate that all of our earnings in the foreseeable future        
will be retained for the development and expansion of our business.             
Therefore, we have no current plans to pay cash dividends.  Future dividend     
policy will depend upon our earnings, capital requirements and financial        
condition as well as on the restrictions that arise from any lines of           
credit or other lending agreements into which we may enter.  In addition,       
no dividends may be declared or paid until all of the principal and             
interest on the notes offered in our private offering of units, which           
commenced in February, 1999 have been paid in full.                             

WHERE YOU CAN FIND ADDITIONAL INFORMATION   

We have filed with the Securities and Exchange Commission,          
Washington, D.C., a registration statement on Form SB-2 under the               
Securities Act of 1933, for the common stock being offeredy.  This              
prospectus does not contain all of the information in the registration          
statement and the exhibits and schedules. For further information about us      
and our common stock, please refer to the registration statement and the        
exhibits and schedules filed.  Statements contained in this prospectus as       
to the contents of any contract or document filed as an exhibit to the          
registration statement are qualified to the exhibit as filed.                   

We are subject to the informational requirements of the Securities  
Exchange Act of 1934, as amended, and file reports, proxy statements and        
other information with the Securities and Exchange Commission. In addition      
to the registration statement, and the exhibits and schedules thereto, our      
reports, proxy statements and other information filed with the Securities       
and Exchange Commission may be inspected and copied at the public reference     
facilities maintained by the Commission at 450 Fifth Street, N.W.,              
Washington, D.C. 20549 and at the following Regional Offices of the             
Commission: New York Regional Office, 7 World Trade Center, New York, New       
York 10048; and Chicago Regional Office, Citicorp Center, 500 West Madison      
Street, Suite 1400, Chicago, Illinois, 60661.  Copies of such material may      
be obtained from the public reference section of the Commission at 450          
Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates.  You may       
also call the Commission at 1-800-SEC-0330.  The Commission maintains a         
Website that contains reports, proxy statements and other information           
regarding issuers that file electronically with the Commission. The address     
of that Website is: http://www.sec.gov                                          

USE OF PROCEEDS   

We may not receive any proceeds from this offering if none of the   
warrants are exercised.  However, some of the shares being sold may be          
acquired from us upon the exercise of currently outstanding public or           
private warrants.  We would receive $6,452,680 in proceeds if all the           
public and private warrants are exercised within 120 from the effective         
date of this registration statement and $8,614,885 in proceeds if all the       
public and private warrants are exercised thereafter. We plan to use all        
proceeds generated from the exercise of warrants for working capital and        
general corporate purposes.  We will receive none of the proceeds from the      
sale of the common stock.                                                       

SELLING SECURITY HOLDERS    

 We have agreed to register the resale of outstanding shares of common
stock and the shares underlying the public and private warrants under the       
Securities Act and to pay all expenses in connection therewith.  An             
aggregate of 1,039,441 shares underlying the public and private warrants        
and currently outstanding shares may be offered and sold through this           
prospectus by the selling shareholders. Except as set forth below, none of      
the selling shareholders has ever held any position or office with us or        
had any other material relationship with us.                                    

SELLING SECURITY HOLDERS AND    
TRANSACTIONS WITH SELLING SECURITY HOLDERS    

                                                        [Enlarge/Download Table]

                                                 Shares/                               Shares/                  
                                             Warrant Shares/                           Warrant                  
                                               Conversion               Shares/        Shares/                  
                                                 Shares             Warrant Shares/  Conversion   Percentage of 
                                              Beneficially            Conversion       Shares        Shares     
Name and Address of                           Owned Prior               Shares       Owned After  Owned After   
Security Holder                               to Offering               Offered        Offering   Offering(1)   
-------------------                          --------------         ---------------  -----------  --------------

                                                                                                                
Luis Barros(2)(3)                                 0/6,180/0             0/6,180/0             0       *         

Cantella & Co., Inc.(2)(4)                        0/2,190/0             0/2,190/0             0       *         

Timothy J. Flanagan(2)(5)                        0/13,530/0            0/13,530/0             0       *         

Capitol Bay Securities(6)                         0/5,820/0             0/5,820/0             0       *         

George Scritchfield(7)                           0/23,280/0            0/23,280/0             0       *         

Robb Peck McCooey Clearing Corp.(2)(8)            0/5,000/0             0/5,000/0             0       *         

Diversified Investors Capitol Services                                                                          
 of N.A., Inc.(9)                               0/100,000/0           0/100,000/0             0       *         

Harris Shapiro(10)                               0/50,000/0            0/50,000/0             0       *         

Vecchio Consulting, Inc.(11)                     0/25,000/0            0/25,000/0             0       *         

Mitchell Feinsod(12)                             12,500/0/0            12,500/0/0             0       *         

Jack O'Leary(13)                                0/150,000/0            0/75,000/0    0/75,000/0       *         

"The Roy S. and Cathleen Mollard                                                                                
 Living Trust, amended 1997"(14)             10,000/0/5,000        10,000/0/5,000             0       *         

James Noack(14)                              45,000/0/7,500        45,000/0/7,500             0       *         

James Noack  Cust FBO                                                                                           
 Patrick Noack(14)                            5,000/0/2,500         5,000/0/2,500             0       *         

Joao Pinto Requiejo(14)                       5,000/0/2,500         5,000/0/2,500             0       *         

Barry Perlow Management Plus                                                                                    
 Pension(14)                                  2,500/0/1,250         2,500/0/1,250             0       *         

Bob L. Hausler(14)                            2,500/0/1,250         2,500/0/1,250             0       *         

Joseph M. Rodrigues(14)                       5,000/0/2,500         5,000/0/2,500             0       *         

Antonio Rodrigues(14)                         2,500/0/1,250         2,500/0/1,250             0       *         

Andrew & Jeanette Impagliazzo(14)             2,500/0/1,250         2,500/0/1,250             0       *         

Jay R. Bloom(14)                             10,000/0/5,000        10,000/0/5,000             0       *         

Fred C. & Margaret Hoeppner(14)               5,000/0/2,500         5,000/0/2,500             0       *         

Jose Maria Salema Garcao(14)                30,000/0/15,000       30,000/0/15,000             0       *         

Michael and Judi Male(14)                     5,000/0/2,500         5,000/0/2,500             0       *         

Artas Corp.                                      10,000/0/0            10,000/0/0             0       *         

D.P. Morton & Associates                          5,000/0/0             5,000/0/0             0       *         

TLD Verhogensverwaltung GESMBH                   25,000/0/0            25,000/0/0             0       *         

Jerome Schuster                                  75,000/0/0            75,000/0/0             0       *         

AMC Consumer                                     25,000/0/0            25,000/0/0             0       *         

Aarnel Funding Corp. Pension Plan                37,500/0/0            37,500/0/0             0       *         

Michael Gindi                                     7,500/0/0             7,500/0/0             0       *         

Ezra Missry                                      37,500/0/0            37,500/0/0             0       *         

Morris Missry                                    37,500/0/0            37,500/0/0             0       *         

Robert M. Kessler                                10,000/0/0            10,000/0/0             0       *         

Mark Schachner                                   25,000/0/0            25,000/0/0             0       *         

Whale Securities Co., L.P.(15)                   0/71,597/0            0/71,597/0             0       *         

William G. Walters(15)                            0/5,602/0             0/5,602/0             0       *         

Elliot J. Smith(15)                               0/2,794/0             0/2,794/0             0       *         

Estate of Howard D. Harlow(15)                    0/2,090/0             0/2,090/0             0       *         

James D. Whitten(15)                                0/210/0               0/210/0             0       *         

Cynthiz Buckwalter(15)                              0/209/0               0/209/0             0       *         

Stanley R. Goldstein(12)(16)                  5,075/1,250/0         5,075/1,250/0     0/1,250/0       *         

Victor J. DiGioia(12)(17)                     6,075/1,250/0         6,075/1,250/0     0/1,250/0       *         

Brian C. Daughney(12)(18)                         1,350/0/0             1,350/0/0             0       *         

Michael A. Goldstein(12)(19)                      1,000/0/0             1,000/0/0             0       *         

<FN>                                                                                                            
--------------------                                                                                            
<F*>  Percentage is less than 1%.                                                                               
<F1>  Computed for purposes herein to give effect to the exercise of all                                        
      warrants held by such selling security holder and not any other                                           
      selling security holder.  Figures are computed based upon 3,144,482                                       
      shares of common stock outstanding on the effective date of this                                          
      registration statement.                                                                                   
<F2>  Shares issuable upon exercise of warrants at an exercise price of                                         
      $1.20 per share exercisable until February 19, 2004.                                                      
<F3>  Mr. Barros was retained by Widecom in connection with its first                                           
      private placement in the 1999 fiscal year.                                                                
<F4>  Cantella & Co. was retained by Widecom in connection with its first                                       
      private placement in the1999 fiscal year.                                                                 
<F5>  Mr. Flanagan was retained by Widecom in connection with its first                                         
      private placement in the 1999 fiscal year.                                                                
<F6>  Includes 4,620 shares issuable upon exercise of warrants at an                                            
      exercise price of $1.20 per share exercisable until February 19, 2004                                     
      and 1,200 shares issuable upon exercise of warrants at an exercise                                        
      price of $2.00 per share exercisable until August 27, 2004.  Capital                                      
      Bay Securities was retained by Widecom in connection with its private                                     
      placements in the 1999 fiscal year.                                                                       
<F7>  Includes 18,480 shares issuable upon exercise of warrants at an                                           
      exercise price of $1.20 per share exercisable until February 19,                                          
      2004 and 4,800 shares issuable upon exercise of warrants at an                                            
      exercise price of $2.00 per share exercisable until August 27, 2004.                                      
      Mr. Scritchfield was retained by Widecom in connection with its                                           
      private placements in the 1999 fiscal year.                                                               
<F8>  Robb Peck McCooey Clearing Corp. was retained by Widecom in                                               
      connection with its first private placement in the 1999 fiscal year.                                      
<F9>  Shares issuable upon exercise of warrants at an exercise price of                                         
      $2.00 per share exercisable until July 26, 2004.  Diversified                                             
      Investors was retained by Widecom in connection with its second                                           
      private placement in the 1999 fiscal year.                                                                
<F10> Shares issuable upon exercise of warrants at an exercise price of                                         
      $3.00 per share exercisable until April 12, 2004.                                                         
<F11> Shares issuable upon exercise of warrants at an exercise price of                                         
      $8.00 per share exercisable until October 1, 2004.                                                        
<F12> Listed shares are restricted shares.                                                                      
<F13> Includes 75,000 shares, which are being included in this prospectus,                                      
      issuable upon exercise of warrants at an exercise price of $8.00 per                                      
      share exercisable until October 8, 2009 unless specified events occur                                     
      which would result in an adjustment of the exercise price to $2.00                                        
      per share; and includes 75,000 shares issuable upon exercise of                                           
      warrants at an exercise price of $8.00 per share exercisable until                                        
      October 8, 2009 unless specified events occur which would result in                                       
      an adjustment of the exercise price to $2.00 per share, which shares,                                     
      however, do not vest until the occurrence of events specified in the                                      
      warrant agreement and are not covered by this prospectus.  A change                                       
      in control of Widecom will trigger the adjustment.  Mr. O'Leary was                                       
      retained by Widecom to provide consulting services.                                                       
<F14> Includes shares issuable upon conversion of a 12% three-year                                              
      convertible promissory note.                                                                              
<F15> Whale Securities Co., L.P. served as the underwriter in Widesom's                                         
      initial public offering in December, 1995.  Represents shares                                             
      underlying underwriters warrants held in the name of Whale for the                                        
      accounts of certain current and former debt and equity owners and                                         
      employees of Whale.  Does not include shares held by any customer                                         
      account or trading account of Whale.                                                                      
<F16> Mr. Goldstein is a partner in Goldstein & DiGioia, LLP, counsel to                                        
      Widecom.                                                                                                  
<F17> Mr. DiGioia is a partner in Goldstein & DiGioia, LLP, counsel to                                          
      Widecom.                                                                                                  
<F18> Mr. Daughney is a partner in Goldstein & DiGioia, LLP, counsel to                                         
      Widecom.                                                                                                  
<F19> Mr. Goldstein is an associate of Goldstein & DiGioia, LLP, counsel to                                     
      Widecom.                                                                                                  
</FN>                                                                                                           

SELECTED FINANCIAL DATA   

Statement of Earnings Data:                                                     

                                                                [Download Table]

                                             Year Ended March 31,            
                                     ------------------------------------    
                                     1997            1998            1999    
                                     ----            ----            ----    

                                                                             
Total Revenue                     $1,820,713      $3,053,804      $3,075,609 
Product Sales                      1,678,933       2,890,443       2,575,935 
R & D Grants                              --          24,567         479,821 
Total Expenses                     5,673,672       5,487,826       4,708,600 
Earnings (loss) before                                                       
 extraordinary item               (4,487,824)     (3,335,865)     (2,244,351)
Net Earnings (loss)               (4,487,824)     (3,335,865)     (2,244,351)

Earnings (loss) per share before                                             
 extraordinary item                    (3.96)          (2.36)          (1.28)

Net Earnings (loss) per share          (3.96)          (2.36)          (1.28)
Weighted average shares                                                      
 outstanding                       1,133,396       1,416,047       1,749,386 

Balance Sheet Data:                                                             

                                                                [Download Table]

                                                 Year Ended March 31,           
                                         ------------------------------------   
                                         1997            1998            1999   
                                         ----            ----            ----   

                                                                                
Working Capital                       $1,818,883      $1,429,046      $  229,470

Total Assets                           6,925,187       5,651,180       4,278,216
Total Liabilities                      1,681,884       1,414,246       1,970,893


MANAGEMENT'S DISCUSSION AND ANALYSIS    
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS    

Overview                                                                        

Since our inception, we have generated limited revenues from        
operations and have not yet achieved significant profitability. Our             
revenues are primarily derived from product sales that are recognized for       
accounting purposes when products are shipped.                                  

 Commercialization of our WC-series copier systems late in fiscal 1998
had only a small material impact on our revenues for the fiscal year 1999.      
During the year, sales of printers and scanners were $618,224 and               
$1,957,711, or 24% and 76%, respectively.                                       

Our selling, general and administration infrastructure was set up to
service our full product line of monochrome and color scanners, monochrome      
and color printers and monochrome and color copiers. Neither our color          
printer nor color copier has yet been commercialized and the latest             
monochrome printers and copiers had only a small material impact on             
revenues. Although we anticipate a return to profitability upon the             
introduction of our full extended product line, there is no assurance that      
we will be able to successfully develop and commercialize these products.       

We are aware of the potential year 2000 or "Y2K" problem.  We have  
reviewed our computer software and hardware, which are critical to the our      
operations and preparation of our financial statements, and have made plans     
for action, as required, prior to the year 2000, to avoid significant           
errors in our accounting records and any adverse effects on business            
operations.                                                                     

Government Sponsored Programs                                                   

During 1997, a change in Canadian Tax legislation substantially     
reduced the amount of subsidy available on research and development             
performed by publicly traded companies. Subsidies of this nature have           
represented a substantial portion of our revenue in the past. Our research      
and development is conducted by Technologies NovImage, which entitles us to     
receive grants in excess of 40% of qualified research expenditures.             
NovImage was formed on October 2nd, 1996, when we entered into an agreement     
with an economic development agency of the Province of Quebec.  All of our      
primary research and development activities are now conducted through           
NovImage, which activities are expected to qualify for partial funding from     
governmental agencies. Products derived from the research are then licensed     
back to us at a nominal royalty of 0.5% of sales of those products. The         
formation of NovImage allows us to obtain a substantial increase in the         
amount of research that can be performed.                                       

Impact of Currency Exchange Rates                                               

 We conduct a substantial portion of our business in foreign currency,
primarily the Canadian dollar and, to a lesser extent, the Indian rupee. To     
date, fluctuation in foreign currency exchange rates have not had a             
significant impact on our results of operations. Fluctuations in the            
exchange rates between the United States dollar and the Canadian dollar or      
Indian rupee, however, could have an adverse effect on our operating            
results in the future. We may seek to limit our exposure to the risk of         
currency fluctuations by engaging in foreign currency transactions that         
could, however, expose us to substantial risk of loss. We have limited          
experience in managing international transactions and have not yet              
formulated a strategy to protect us against currency fluctuations. There        
can be no assurance that fluctuations in foreign currency exchange rates        
will not have a significant impact on our future operating results.             

Recently Issued Accounting Standards                                            

In June 1997, the Financial Accounting Standards Board issued       
Statement of Financial Accounting Standards No. 130, Reporting                  
Comprehensive Income, which establishes standards for reporting and display     
of comprehensive income, its components and accumulate balances.                
Comprehensive income is defined to include all changes in equity except         
those resulting from investments by owners and distributions to owners.         
Among other disclosures, SFAS 130 requires that all items that are required     
to be recognized under current accounting standards are components of           
comprehensive income be reported in a financial statement that is displayed     
with the same prominence as other financial statements.                         

SFAS 130 is effective for financial statements for periods beginning
after December 15, 1997 and requires comparative information for earlier        
years to be initiated.  We adopted this standard in connection with the         
preparation of our financial statements for the year ended March 31, 1999.      
Results of operations and financial position, however, will be unaffected by    
implementation of this standard.                                                

In June 1997, the Financial Accounting Standards Board issued SFAS  
No. 131, Disclosures about segments of an Enterprise and Related                
Information which supersedes SFAS No. 14, Financial Reporting for Segments      
of a Business Enterprise. SFAS 131 establishes standards for the way that       
public companies report information about operating segments in annual          
financial statements and requires reporting of selected information about       
reporting segments in interim financial statements issued to the public. It     
also establishes standards for disclosures regarding products and services,     
geographic areas an major customers. SFAS 131 defines operating segments as     
components of a company about which separate financial information is           
available that is evaluated regularly by the chief operating decision maker     
in deciding how to allocate resources and in assessing performance.             

SFAS 131 is effective for financial statements for periods beginning
after December 15, 1997 and requires comparative information for earlier        
years to be restated.  We adopted this standard in connection with the          
preparation of our financial statements for the year ended March 31, 1999.      
Results of operations and financial position, however, will be unaffected by    
implementation of this standard.                                                

Results of Operations                                                           

Safe Harbor for Forward-Looking Statements                          
------------------------------------------                          

Various statements contained herein constitute forward-looking      
statements within the meaning of the Private Securities Litigation Reform       
Act of 1995.  We desire to avail ourself of certain safe harbor provisions      
of the 1995 Reform Act and therefore include this special note to enable us     
to do so. Forward-looking statements included in this prospectus involve        
known and unknown risks, uncertainties, and other factors which could cause     
our actual results, financial and operating performance or achievements to      
differ from the future results, financial or operating performance or           
achievements expressed or implied by those forward looking statements.          
These future results are based upon management's best estimates based upon      
current conditions and the most recent results of operations. These risks       
include, but are not limited to, risks associated with the our recent           
losses, our ability to develop and market our product line, the commercial      
acceptance of our products, the need for additional capital, the effects of     
competition and technological changes and dependence upon key personnel.        

Year Ended March 31, 1999 Compared                                              
to Year Ended March 31, 1998                                                    

Revenues for the year ended March 31, 1999 were $3,075,609, an      
increase of $21,805 or 0.7%, as compared to $3,053,804 for the year ended       
March 31, 1998. This increase was attributable to additional research and       
development grants of $455,254, which were partially offset by a decrease       
in interest income of $118,941.  Total research and development grants for      
this period was $479,821.  This increase was due to the transfer of the         
majority of our research and development functions to NovImage.                 

 Operating expenses for the year ended March 31, 1999 were $4,708,600,
a decrease of $779,226, or 14.2%, as compared to $5,487,862 for the year        
ended March 31, 1998. Operating expenses also decreased as a percentage of      
revenues from 178.8% for the year ended March 31, 1998 to 153.1% for the        
year ended March 31, 1999. The decrease in operating expenses, both in          
absolute dollars and as a percentage of revenues, is primarily attributable     
to decreases in research and development expenditures and selling, general      
and administrative costs.                                                       

The decrease to our research and development expenses was due to our
transfer of these costs to NovImage.  The decrease in selling, general and      
administrative costs were primarily due to our ability to streamline our        
operations to improve efficiency and profitability and to take advantage of     
economies of scale with respect to our purchasing, supply, retail and           
manufacturing operations as we continued expansion of our distribution          
channel in the United States.                                                   

Year Ended March 31, 1998 Compared                                              
to Year Ended March 31, 1997                                                    

Revenues for the year ended March 31, 1998 were $3,053,804, an      
increase of $1,233,091, or 67.7%, as compared to $1,820,713.for the year        
ended March 31, 1997. This increase was attributable to an increase in          
product sales of $1,211,510 and additional research and development grants      
of $24,566, which were partially offset by a decrease in interest income of     
$2,986.  Total product sales for this period was $2,890,443.  Total             
research and development grants for this period was $24,567.                    

The introduction of the Small Computer System Interface-based SLC836
scanner in late March 1998 overcame compatibility problems that had been        
experienced from January to March, 1998 with the previously proprietary         
computer interface and with Intel Pentium II processors.  This                  
compatibility problem with the SLC 436 series scanners delayed sales in the     
last quarter of our fiscal year.                                                

 Operating expenses for the year ended March 31, 1998 were $5,487,826.
This represents a decrease of $185,846, or 3.2%, from the year ended March      
31, 1997.  Operating expenses for the year ended March 31, 1997 were            
$5,673,672.                                                                     

Operating expenses also decreased as a percentage of revenues from  
311.6% for the year ended March 31, 1997 to 178.8% for the year ended March     
31, 1998. The decrease in operating expenses, both in absolute dollars and      
as a percentage of revenues, is primarily attributable to decreases in          
research and development expenditures and selling, general and                  
administrative costs.                                                           

The decrease in research and development expenses was due to the    
formation of NovImage as we transferred the majority of our research and        
development projects to NovImage.  Of the $1,005,820 loss incurred by           
NovImage, we incurred 45% of that amount, or $452,619.                          

The decrease in selling, general and administrative costs were      
primarily due to a leveling off of expenditures and economies undertaken to     
effect savings as we completed the establishment of our distribution            
channel in the United States.                                                   

The costs of $309,375, incurred in connection with the settlement of
a shareholders' lawsuit were costs that continued from the previous year        
related to the settlement of suits arising from our warrant redemption in       
February 1997. The increase in the equity loss in the joint venture is          
offset by the decrease in research and development costs of $515,397.           

Quarter Ended September 30, 1999 Compared                                       
to Quarter Ended September 30, 1998                                             

  Revenues for the quarter ended September 30, 1998, was supplemented by
a non-recurring research and development grant of $301,285.  Product sales      
for the quarter ended September 30, 1999 were $593,692, a decrease of $42,263   
or 6.6% as compared to $635,955 for the quarter ended September 30, 1998.  The  
decrease in product sales was a result of delays in deliveries of copiers and   
printers as we implemented improvements to the paper and ribbon loading         
mechanisms.  We were also unable to take advantage of orders in-hand for our    
72" wide color-scanners, for which we started to make deliveries after the      
end of the quarter.                                                             

Our operating expenses for the quarter ended September 30, 1999 were
$644,846, a decrease of $317,301, or 33.0%, as compared to $962,147 for the     
quarter ended September, 1998.  This decrease was due to our reduction in       
selling, general and administrative expenses, which decreased by $256,118 for   
this quarter, representing a decrease as a percentage of sales from 116.8% to   
82.0%.  The decrease in selling, general and administrative expenses was        
primarily due to a leveling off of expenditures and benefitting from            
economies of scale as we continued expansion of our distribution channel in     
the United States.                                                              

We also incurred legal, administration and other related costs      
associated with our warrant call and initial public offering.                   

  Our share of the loss incurred by NovImage amounted to $68,246, or 45%
of NovImage's loss for this quarter.  During the second quarter of fiscal       
2000, we earned $2,734 interest on short-term investments compared to           
$3,057 earned in the same period last year.                                     

Quarter Ended September 30,1998 Compared                                        
to Quarter Ended September 30,1997                                              

Revenues for the quarter ended September 30, 1998 were $940,297, an 
increase of $57,862 or 6.55% as compared to $882,435 for the quarter ended      
September 30, 1997.  Sales for the quarter ended September 30, 1998 were        
$635,955, a decrease of $218,806 as compared to $854,761 for the quarter        
ended September 30, 1997.                                                       

Operating expenses for the quarter ended September 30, 1998 were    
$962,147, as decrease of $115,020, or 10.67%, as compared to $1,077,167 for     
the quarter ended September 30, 1997.  Research and development expenses        
decreased from $28,288 for the quarter ended September 30, 1997 to $0 for       
the quarter ended September 30, 1998.                                           

Selling, general and administrative expenses for the quarter ended  
September 30, 1998, decreased by $104,922 and decreased as a percentage of      
revenues from 96.09% to 79.02%.  We continue to incur legal, administration,    
and other related costs associated with our warrant call.                       

Our share of the loss incurred by NovImage for the quarter ended    
September 30, 1998, amounted to $67,055 as compared to $67,422 for the          
quarter ended September 30, 1997.                                               

Liquidity and Capital Resources                                                 

Our primary cash requirements have been to fund the purchase of     
inventories and to meet operating expenses incurred in connection with the      
commercialization of our products. Until our initial public offering, we        
had satisfied our working capital requirements principally through the          
issuance of debt and equity securities, government sponsored research and       
development grants and reimbursement and cash flow from operations.  At         
March 31, 1999, we had working capital of $229,470, as compared to              
$1,429,046 at March 31, 1998.                                                   

Our cash requirements in connection with manufacturing and marketing
will continue to be significant. We do not have any material commitments        
for capital expenditures. We believe, based on our currently proposed plans     
and assumptions relating to our operations, projected cash flow from            
operations will be sufficient to satisfy our contemplated cash requirements     
for the foreseeable future. In the event that our plans or assumptions          
change, or prove to be incorrect, or if the projected cash flows otherwise      
prove to be insufficient to fund operations, we could be required to seek       
additional financing sooner than currently anticipated. There can be no         
assurance that this additional financing will be available to us when           
needed on commercially reasonable terms, or at all.  We intend to fund          
these cash requirements during the next twelve months through increased         
sales of our products.                                                          

With respect to the Noida manufacturing facility, we have already   
paid $491,401 for construction and land costs.  We initially estimated that     
these costs would be $500,000.  However, we estimate that additional            
construction costs may be incurred of up to $200,000.  We intend to pay for     
any additional costs out of revenues derived from our operations.               

 During fiscal 1999, Widecom's shareholders approved the engagement of
Robb Peck McCooey Clearing Corporation, Cantella & Associates and Quantum       
Resources, Inc., three related financial services companies, to conduct a       
private offering of our securities to raise funds for investment in             
Widecom.  The securities offered consisted of units, each unit consisting       
of 10,000 shares of our common stock and a 12% three-year convertible note      
in the principal amount of $20,000.  9.5 units were sold during fiscal 1999     
and the closing for an additional 0.5 units occurred after the fiscal year      
end.  In total, 95,000 shares of common stock were issued through the           
offering during fiscal 1999 and an additional 5,000 shares of common stock      
were issued in the first quarter of fiscal 2000.  We raised $300,000 due to     
the sale of the 100,000 shares of our common stock.  The sale price per         
share was $3.00.  All selling agents are entitled to warrants for the           
purchase of a total of 50,000 shares of our common stock at an exercise         
price of $1.20.                                                                 

 Subsequently, we conducted an additional private placement of 325,000
shares of our common stock.  Under the terms of the offering, each share        
was offered at $2.00 per share.  This offering was fully subscribed at the      
closing, which took place of July 6, 1999.  The selling agent in this           
offering received warrants for the purchase of 100,000 shares of our common     
stock at an exercise price of $2.00 per share.                                  

DESCRIPTION OF BUSINESS   

We design, assemble and market high-speed, high-performance document
systems which transmit, receive, print, copy and/or archive wide format         
documents, such as blueprints, schematics, newspaper layouts and other          
mechanical and engineering drawings. Our products include a 36" wide format     
scanner, a 36" wide format copier and a 36" wide format plotter/printer. We     
also market a modular digital multi-function unit which incorporates a          
scanner module, a plotter module, optional internal modems and software to      
permit the unit to interface with a personal computer and combine scanning,     
printing, facsimile and copying functions in one unit.                          

We design our document management systems in response to perceived  
market demand for systems that facilitate the efficient management and          
transmission of wide format documents.  Our primary market is for               
architectural, engineering and construction applications.  In addition, we      
also market our products for use by manufacturers in the garment,               
woodworking and graphic arts industries, utilities and government agencies      
and for applications in newspaper and advertising industries. Although our      
product markets are highly specialized and although we have not conducted       
any formal market studies as to the potential demand for wide format            
document systems, we firmly believe that the world-wide market for wide         
format document systems is emerging as a result of increasing demand for        
systems which can more efficiently scan, copy, print, transmit, receive and     
archive wide format documents. Our products provide attractive alternatives     
to traditional methods used to permit multiple consumers in different           
locations to view wide format documents.  We believe our products are more      
time and cost-efficient than outmoded methods such as overnight couriers        
delivering copies of a document or microfiche reproduction.                     

On October 2nd, 1996, Widecom formed a research and development     
consortium known as 3994340 Canada Inc., operating as Technologies              
NovImage, with an economic development agency of the Province of Quebec.        
All of our primary research and development activities are now conducted        
through NovImage, which activities are expected to qualify for partial          
funding from governmental agencies.  Our capital investment in NovImage was     
approximately US $1,875,000 each, for which we received 450 shares of the       
Class A common stock of NovImage.  This consideration was paid for by cash      
derived from our working capital.                                               

Products                                                                        

Widecom SLC936-C Color Scanner                                      

The SLC936-C is a wide format scanner capable of scanning documents 
up to 36" wide. Our new 24 bit scanners are available in color and              
monochrome models and offer Small Computer System Interfacing with personal     
computers to enable the user to scan images into the personal computer for      
display, editing and archiving. First generation scanners were able to          
process monochromatic images only.  The second-generation SLC436-C,             
introduced in May 1996, represented our first low-cost wide format color        
scanner capable of scanning 36" by 48" documents at a resolution of 400 dpi     
in under thirty seconds for monochrome images, and under eight minutes for      
full color images.                                                              

The new SLC936-C and SLC936+ monochrome scanner were introduced in  
late 1998 and possess interpolated resolution capabilities of up to 900         
dpi.  Interpolated resolution capabilities means that the computer is able      
to read an image with resolution capabilities of greater that 200 dots per      
inch, which is the traditional limit.  Through this technology, the             
software subdivides the image into a greater number of dots in the specific     
area.  This generation of SLC936 series scanners also provide the industry      
standard Small Computer System Interface which overcomes compatibility          
problems with the proprietary interface of the SLC 436 series scanners          
associated with Intel's Pentium II[TRADEMARK] processors. These products        
offer high speed, high quality scanning capacity to Geographic Information      
Systems, Engineering Document Management Systems, Reprographic and graphic      
arts applications with high fidelity to complex originals.  The SLC936          
Series offer a four times faster thoroughput speed than the previous SLC436     
and SLC836 models.                                                              

Our scanners incorporate our single line contact technology to      
capture the image of a wide format document.  With this technology, one         
head moves in a straight line in contact with the paper.  In contrast,          
traditional technology employs multiple lenses which do not touch the           
paper.  The contact scanner consists of a 36" fiber optic array, 8mm image      
sensor computer chips aligned to create a 36" length light sensor, a 36"        
light emitting diode array and software designed to enhance the scanned         
image by removing deteriorations from the document being reproduced and         
interface the scanner with a personal computer. The fiber optic array acts      
as a lens and focuses the image on the image sensor computer chips which        
read the image. Because our image sensor computer chips contain pixels          
larger than those of chips used in other scanners manufactured by other         
companies, our contact scanners require less light exposure and, therefore,     
operate faster than other scanners.                                             

The software incorporated in the SLC936-C improves scanned images by
removing background discoloration and enhancing faded images. This              
capability improves the image quality of documents which are stained or         
which have faded over time. Various enabling software packages permits our      
SLC936-C scanner to interface with a personal computer, as well as permit       
the user to perform a variety of scanning, editing, viewing and                 
transmission functions.                                                         

Traditional document scanners employ camera based lenses that are   
only capable of scanning documents up to 12" wide. Traditional wide format      
scanners employ multiple camera lenses to capture portions of a document's      
image and integrate the images to reproduce a wide format document. The         
reproduced document can be distorted by camera based scanners, particularly     
at the edges, and misaligned at the center as a result of the use of            
multiple lenses, thereby limiting the reliability and usefulness of the         
reproduced document. We believe that our single line contact scanner            
technology and software enable our products to scan and reproduce such          
documents with vastly improved clarity and accuracy.                            

SLC1036                                                             

We have adopted a vertical orientation in our products to facilitate
a greater spectrum of end user preferences and increase our market share.       
During the last fiscal year, we introduced the SLC1036; a more advanced         
model of our single line contact color scanner that is marketed along side      
our SLC936 product. Capable of direct Scan-to-File and Scan-to-Print            
functions, the SLC1036 has throughput of over 4 inches per second at 400        
dpi resolution. At the monochrome setting, the SLC1036 is capable of            
scanning a 36" x 48" monochrome image in less than 12 seconds. The SLC1036      
is twice as fast on scans and output and is available for a 30% premium in      
price over our 936 models and at less than half of the price of the next        
fastest competitor's scanner.  The SLC1036 offers an interpolated               
resolution up to 1000 dpi.                                                      

SLC972                                                              

We also recently announced ongoing development of our super wide    
format scanner, the SLC972, a color and monochrome scanner capable of           
handling documents up to six feet wide (72 inches)with thicknesses ranging      
up to 1/2".  We anticipate a significant performance and overall document       
capacity advantage over similar priced competitor models.  We are now able      
to address all of the tiers in the large format market including                
automotive, aircraft and marine design applications. The SLC972 has             
scanning resolutions of up to 900 dpi and is capable of direct interfacing      
with assorted application specific software and functions well with most        
thermal ink-jet printers/plotters.  We expect to begin formal delivery of       
the SLC972 model no later than the end of this fiscal year.                     

Plotter/Printer (WC 936P)                                           

We introduced the WC436P, a plain paper plotter late in fiscal 1998.
This product was designed to print an image at a speed of 2 inches per          
second. This was replaced in January 1999 with the WC936P, which offered a      
Small Computer System Interface. The WC 936P incorporates our new print         
heads that enable the plotter to print in increments of 400 dpi. This           
plotter is designed to incorporate a thermal transfer ribbon coated with a      
wax-like printing substance which, when heated by energy passing through        
the pixels on the print head, melts onto the paper to reproduce the             
document's image. The plotter, without the thermal transfer ribbon, would       
function as a traditional thermal plotter.                                      

The WC 936P is a wide format plotter capable of printing a document 
up to 36" wide x 325' in length. Widecom's Plotter/Printer interfaces with      
a personal computer to enable the user to print images directly from the        
personal computer. The Plotter/Printer prints wide format documents on          
various media including mylar, matte film and bond paper.                       

Modular Digital Multi-Functional Unit (WC 936 C/P)                  

The Widecom WC 936 C/P consists of a scanner module and a           
plotter/printer module integrated into one unit. Together, these modules        
perform scanning, printing and copying functions. The user of a Widecom         
scanner or a Widecom Plotter/Printer can upgrade either machine to the unit     
by purchasing and connecting the other module.                                  

The unit features high speed, high quality printing, copying and    
scanning at over two inches per second and with resolution at 400 dots per      
inch.  Indirect thermal printing using thermal transfer ribbons saves time      
and money with increased uptime and productivity.                               

This new unit facilitates practical entry into the digital copier   
environment for users with lower volume requirements.  This new unit is         
also extremely compact in comparison to similar functioning products from       
other manufacturers. This Widecom Copier/Printer incorporates original and      
copy catch trays into its stand-alone set up and uses a single media roll.      
This product has Windows? and AutoCad? compatible applications enabling         
digital scanning and storage of color and monochrome images and production      
of multiple copies, collated sets and image size control including              
reduction and enlargement capabilities.                                         

Original Equipment Manufacturers Components                         

We manufacture our own scan and print heads that possess our        
proprietary Contact-Sensor-Array technology and we are now making them          
available to original equipment manufacturers for use in their products.        
This technology combines a light emitting diode array with image sensor         
computer chips.  A 12" OEM scan head was custom-developed by us for a           
specific departmental scanner manufacturer to facilitate automated form         
processing. We expect to secure additional OEM agreements for other product     
subassemblies created from all or most of our core-level technologies.          

Software and Accessories                                            

We sell several software drivers for our products that may include  
third party software libraries.  We also sell accessories for use in            
connection with our complete product line, including various types of paper     
and film for the plotter/printers and the copiers. Sales of accessories         
have not been material to date and are not expected to be material in the       
near future.                                                                    

Acquisition of Diprin, Inc.                                                     

At our annual shareholders meeting on January 27, 1999, our         
independent and unrelated shareholders approved the acquisition of Diprin,      
Inc., an Ontario corporation wholly owned by Widecom's President and Chief      
Executive Officer, Mr. Raja S. Tuli.  Diprin was acquired in exchange for       
125,000 shares of Widecom's common stock.  The value of the shares given in     
exchange was $93,750.  Diprin had been actively researching and developing      
portable photo-printer technology for which a patent application is             
currently pending.  We believe that the cost of this technology is              
extremely low in comparison to the potential revenues to be derived from        
potential sales of the portable photo-printer and additional potential          
revenue from consumables that will be marketed along with the product.          

Marketing and Sales                                                             

Our primary marketing strategy is to sell our products in targeted  
commercial markets in which wide format document systems are believed to        
have potential for significant applications.  We believe that                   
architectural, engineering and construction firms, for which reproduction,      
archiving and transmission of wide format documents are essential, is our       
primary market. We also market our products for use by manufacturers in the     
garment industry, utilities and government agencies and applications in the     
newspapers and advertising industries. We believe that our products are         
used by consumers in these markets for a variety of applications, including     
the transmission of construction plans, architectural drawings, newspaper       
and advertising layouts and clothing patterns.                                  

We establish beneficial marketing relationships by engaging         
independent distributors and dealers to market our products in various          
regions throughout the United States and in foreign markets. As of March        
31, 1999, we had arrangements with approximately 90 distributors, dealers       
and sales agents have written agreements with approximately 75% of them.        
Generally, our distributor agreements are for a term of two to three years      
and grant the distributor the right to market our products within a             
specified territory during the term of the agreement.                           

We sell products to distributors at discounts when compared to end  
user price of the products. These discounts rarely exceed 40% of the list       
price and rarely approach 25%. For the years ended March 31, 1997, 1998 and     
1999, our five largest distributors accounted for approximately 49.9%,          
43.1% and 20.3%, respectively, of our overall product sales.                    

No single distributor represented more than 10% of our sales for our
fiscal year ended March 31, 1999. During the years ended March 31, 1997,        
1998 and 1999, sales by distributors accounted for approximately 96.4%,         
93.9% and 94.7%, respectively, of our product sales. We support our U.S.        
and international distribution channels through four regional sales             
managers that are all presently located in the U.S and Canada.                  

A substantial portion of our sales has been made to foreign markets,
primarily to Europe, the Middle East and Asia. The following table sets         
forth the amount of our sales by geographic region.  Sales amounts are          
expressed both as a dollar amount and as a percentage of product sales for      
the indicated period:                                                           

Regional Sales Breakdown                                            

                                                        [Enlarge/Download Table]

                                         Year Ended March 31,                         
                  ------------------------------------------------------------------- 
                        1997                     1998                      1999       
                  ---------------          ----------------          ---------------- 
Region            Amount        %          Amount         %          Amount         % 
------            ------        -          ------         -          ------         - 

                                                                                      
United States  $  467,766      27.9      $1,246,270      43.0      $1,338,704      52 

Middle East       346,595      20.6         312,042      11.0         200,711       8 

Asia              266,346      15.9         322,685      11.0         583,077      23 

Europe            475,551      28.3         686,478      24.0         241,708       9 

Canada            122,675       7.3         322,968      11.0         211,735       8 

Total          $1,678,933     100.0      $2,890,443     100.0      $2,575,935     100%

Warranty, Service and Maintenance                                               

We offer a 90-day limited warranty, which can be extended for a term
of up to one-year.  This limited warranty covers the workmanship and parts.     
During the term of the warranty of products sold directly by us, we will        
repair our products and replace parts that become defective due to normal       
use. During the term of the warranty of products sold by distributors, we       
will replace parts that become defective due to normal use.  The                
distributor is responsible for servicing the product.                           

We provide a warranty to distributors for a period expiring on the  
earlier of twelve months following the distributor's purchase of the            
product and three months following the distributor's sale of the product.       
We train our in-house service engineers and certain distributors to enable      
them to service and maintain our products.                                      

We also operate a toll-free telephone line during normal business   
hours to respond to distributors and user inquiries about the operation,        
service and maintenance of our products. We operate and monitor an E-mail       
box which distributors and users can access to receive such assistance.         

Manufacturing                                                                   

We subcontract certain manufacturing operations, such as the        
production of our proprietary printed circuit boards or machine enclosures,     
to outside suppliers. Off-the-shelf items, such as integrated circuits,         
modems, rollers, gears and liquid crystal displays, are acquired directly       
from vendors. We believe that alternative sources of supply for all of our      
components and custom parts are readily available on commercially               
reasonable terms. We do not maintain supply agreements with any of our          
suppliers or subcontractors.  We purchase components and custom parts in        
the ordinary course of business. Most of the components are acquired in the     
United States and shipped to our manufacturing facility in a free trade         
zone in India. Quality control and adjustments are also conducted at our        
Indian facility.                                                                

 While we assemble our products in-house, we will need to increase our
manufacturing capabilities in the event of any increased product demand.        
There can be no assurance that we will succeed on commercially reasonable       
terms, in a timely manner, or at all.                                           

Competition                                                                     

The markets for document systems are characterized by intense       
competition. We believe our products compete on the basis of resolution,        
quality, speed, price and the quality of our distribution channels.             

We compete with numerous well-established foreign and domestic      
companies that market or are developing wide format document systems. Our       
competitors include:                                                            

     *     Contex Corporation, Vidar Systems Inc., Oce and Anatech
       Corporation in the market for wide format scanners;
   *     Calcomp Corporation, Hewlett Packard Company, Oce and
             Mutoh Corporation in the market for wide format plotters;
and                                         
   *     Xerox, Katsuragawa Company and Oce in the wide format
printer and copier market.                  

We also suspect that other companies that manufacture and sell standard         
copiers, scanners and plotters could develop, without significant delay,        
wide format document systems directly competitive with our products. Many       
of these companies possess substantially greater financial, technical,          
marketing and personnel resources than Widecom.  In addition, these             
companies also have established reputations for success in the development      
and marketing of facsimile machines, plotters, scanners and copiers and         
have sufficient budgets to permit them to implement extensive advertising       
and promotional campaigns to respond to competitors and enter new markets.      

In addition, the markets for our products are characterized by      
rapidly changing technology and evolving industry standards.  This often        
results in rapid product obsolescence or shortened product lifecycles. As a     
result, our ability to compete may be dependent upon:                           

*  our ability to continually enhance and improve our products;                 

*  to complete development and introduction into the marketplace of our new     
products in a timely manner; and                                                

*  to successfully develop and market these new products.                       

There can be no assurance:                                          

*  that we will be able to compete successfully;                                

*  that competitors will not develop technologies or products that could        
render our products obsolete or less marketable; or                             

*  that we will be able to successfully enhance our existing products or        
develop new products to continue to compete.                                    

Research and Development                                                        

 In October 1996, Widecom formed a research and development consortium
named Technologies NovImage with Innovatech, an economic development agency     
of the Province of Quebec. We are now conducting all of our research and        
development activities at that facility.  NovImage's activities are             
expected to continue to qualify for partial funding from governmental           
agencies.  The research and development activities conducted by NovImage on     
our behalf are primarily focused on plotter, scanner and copier                 
technologies.                                                                   

The plotter research at NovImage is concentrated in two areas: (1)  
developing a high speed, high quality wide format color plotter/printer and     
(2) improving printer resolution and developing thermal transfer mechanisms     
for incorporation into the plain paper plotter, including color printing        
capabilities.  Our scanner research is presently focused on the development     
of color scanning capabilities and the enhancement of scanner image             
quality.                                                                        

NovImage has completed development of a color-scan chip intended to 
be incorporated into a future model scanner to provide color scanning           
capabilities at speeds of under 30 seconds compared to approximately eight      
minutes with earlier generation scanners. This new chip is designed to          
combine four image sensor computer chips to read the primary colors and         
black.  As a result, the next generation scanners are expected to be able       
to function both as a color scanner and as a monochrome scanner.                

We estimate that research and development expenditures for the 1998 
fiscal year was $691,734 and for the 1999 fiscal year was $586,867.  We         
approved a small increase in the prices of our products to reflect these        
costs.                                                                          

Intellectual Property                                                           

We rely upon intellectual property and employ various methods to    
protect the ideas, concepts and documentation of our proprietary                
technology.  These methods include nondisclosure agreements with our            
employees and distributors.  However, these methods may not afford complete     
protection.  There can be no assurance that our competitors or customers        
will not be able to independently develop such know-how or otherwise obtain     
access to our know-how, ideas, concepts and documentation. We presently         
hold one patent and have filed several other patent applications relating       
to various aspects of our technology.                                           

There can be no assurance that any further patents will be issued to
us or, if issued, that such patents would afford us any competitive             
advantage. In any event, there can be no assurance that future patents, if      
any, could not be circumvented or otherwise invalidated.                        

In addition, some aspects of the technologies embodied in our       
products are generally available to other manufacturers. We are not             
presently aware of any infringement on the proprietary rights of others in      
any of our products.  We have not, however, conducted any formal                
investigation as to any possible infringement(s).  There can be no              
assurance that third parties will not assert infringement claims against us     
in connection with our products, nor that any assertion of infringement         
will not result in litigation.                                                  

We are also unable to speculate as to our chances for success in the
event of any infringement-related litigation or our potential ability to        
license any infringed patents of third parties on commercially reasonable       
terms, or at all.  If our technologies were found to infringe another           
party's rights, we could be required to modify our products or obtain a         
license. There can be no assurance that we would be able to do so in a          
timely manner, upon acceptable terms and conditions, or at all.  Further,       
there can be no assurance that we would have the financial or other             
resources necessary to successfully defend a claim for the violation of         
proprietary rights.                                                             

We have licensed our pending and approved patents, trademarks,      
copyright material and all of our technology relating to our scanner and        
plotter manufacturing technology and software to NovImage for research and      
development purposes.  NovImage is attempting to develop improvements,          
modifications, additions or alterations to that Intellectual Property and       
to develop new products.  In exchange for this license and the payment of a     
0.5% royalty fee on net revenue, licensing revenue and net sales to sub-        
licensees, NovImage granted us an exclusive perpetual worldwide license,        
except for the Province of Quebec, Canada.  This license allows us to use       
improved scanner and plotter technology and software to manufacture,            
distribute, market and sell the improved scanner, plotter and software, and     
any new products developed by NovImage.  NovImage retained these rights         
with respect to the Province of Quebec, Canada.  We have no other               
restrictions on our sales and marketing activities in Quebec.                   

We have not yet formally filed for copyright protection of our      
software and may not pursue such activities in the future.  We hold a           
registered trademark with the United State Patent and Trademark Office.         

Employees                                                                       

As of March 31, 1999, our North American operations had 15 full-time
employees, including sales staff and administrative personnel. We also          
employ 162 people at a manufacturing facility in India and work with our        
wholly owned Indian subsidiary.  Neither Widecom nor our subsidiary is a        
party to any labor agreements and none of our employees are represented by      
a labor union.  At present, we believe our employee relations to be             
satisfactory.                                                                   

Effect of Government Regulation                                                 

Compliance with laws and regulations governing our business can be  
complicated, expensive, and time-consuming and may require significant          
managerial and legal supervision.  Failure to comply with such laws and         
regulations could have a materially adverse effect on our business.             
Further, any changes in any of these laws and regulations could materially      
and adversely affect our business. There is no assurance that we will be        
able to secure on a timely basis, or at all, necessary regulatory approvals     
in the future.                                                                  

At present, environmental compliance issues do not have a material  
effect on the management and earnings of our business, nor is any change        
anticipated.                                                                    

Enforcement of Civil Liabilities                                                

Our headquarters are located in, and our officers, directors and    
auditors are residents of Canada.  Further, a substantial portion of our        
assets are, or may be, located outside the United States.  Accordingly, it      
may be difficult for investors to effect service of process within the          
United States upon non-resident officers and directors, or to enforce           
against them judgments obtained in the United States courts predicated upon     
the civil liability provision of the Securities Act of 1933, as amended or      
state securities laws.  However, there is doubt as to the enforceability in     
Canada against us or against any of our directors, controlling persons,         
officers or the experts named herein, who are not residents of the United       
States, in original actions or in actions for enforcement of judgments of       
U.S. courts, of liabilities predicated solely upon U.S. federal securities      
laws.  Service of process may be effected, however, upon our duly appointed     
agent for service of process.  If investors have questions with regard to       
these issues, they should seek the advice of their individual counsel.          

Properties                                                                      

In February 1996, we purchased property in the Noida Export         
Processing Zone, a Free Trade Zone located near New Delhi, India.  The          
purchase price was approximately $67,500 and we are building a                  
manufacturing facility of approximately 24,000 square feet with estimated       
construction costs of approximately $500,000. Clean-room facilities and         
other special infrastructure within the building are estimated to cost an       
additional $200,000 by completion. We expect that the project should be         
completed in the next fiscal year.  Upon completion of construction of our      
new manufacturing facility, we intend to transfer the majority of our           
manufacturing operations to the new facility.                                   

We lease the following properties:                                  

*  3,000 square feet at 72 Devon Road, Unit #18, Brampton, Ontario, Canada,     
under a two-year lease entered into in 1998, and                                

*  7,000 square feet in the Free Trade Zone, under a five-year lease            
entered into in 1994. The current annual rents are $23,357.64 and $15,200,      
respectively.                                                                   

In addition, we currently lease a sales office at a monthly rent of 
$1,000.00 in Santa Rosa, California and a sales and service facility in         
Pittsburgh, Pennsylvania, at a monthly rent of $2,300.00. The current           
annual rental rates of these facilities are approximately $12,000.00 and        
$27,600.00 respectively and $39,600.00 in the aggregate.                        

Although we believe that our present facilities are adequate for our
current level of operations, we will likely need to increase our                
manufacturing capabilities in the event of any increased demand for our         
products.                                                                       

LEGAL PROCEEDINGS   

On December 20, 1996, two individuals, John Keenan and Vincent      
DiGiulio, filed a lawsuit in the United Stated District Court for the           
District of Rhode Island, seeking 60,000 shares and 40,000 warrants.  This      
action has been formally dismissed.  An additional three shareholders have      
also commenced related litigation, alleging purchases of our securities         
from the previously noted two individuals, who are named as co-defendants.      
We have filed and received default judgments on our cross-claims against        
the two individual co-defendants.  The total number of shares of common         
stock claimed under these suits is less than 15,000.                            

On or about February 27, 1997, plaintiff Brett Whiton commenced an  
action on behalf of himself and a class against Widecom, Raja S. Tuli and       
Suneet S. Tuli in the United States District Court for the Southern             
District of New York.  The complaint alleged improper conduct with respect      
to the arrangement of the redemption of certain warrants. The action was        
settled, along with two substantially similar class actions.  In                
consideration of the settlement, we agreed to issue one replacement warrant     
for each warrant held by the class members on February 10th, 1997 and sold      
by the members prior to the close of business on March 5th, 1997. The           
number of warrants for this arrangement was 94,677 and have been replaced       
by the issuance of 109,466 shares of common stock according to the terms of     
the amended settlement agreement approved in the spring quarter of fiscal       
1999.                                                                           

 Another shareholder's action commenced on or about March 10, 1997, in
the Superior Court of the State of California was resolved by an initial        
transfer of 37,500 shares to the plaintiffs, which was ratified by our          
board of directors in November, 1997.  A final issuance of 18,748               
additional shares occurred in May, 1999.                                        

In April, 1998, we resolved an assessment proceeding with a former  
law firm with respect to disputed bills relating to services rendered prior     
to our initial public offering in December 1995. In July, 1998, we also         
resolved a lawsuit with a former accounting firm with respect to disputed       
invoices relating to services rendered prior to our initial public offering     
in December 1995.                                                               

 In March, 1999, we resolved an outstanding account with an additional
former law firm with respect to disputed bills relating to services             
rendered in furtherance of litigation proceedings arising out of our            
initial public offering.                                                        

We have been served with legal papers claiming breach of contract   
under two specific joint venture and development agreements to use and          
distribute various iterations of software components, which the claimant        
alleges is its sole property.  The title of the action is Nexsys                
Consulting, Inc. and Tern Solutions Group Corp. v. The Widecom Group, Inc.      
The action claims damages for breach of contract and copyright and              
trademark infringement.  The claim seeks a total of $15.85M in damages and      
is currently pending in the Superior Court of Justice of the Province of        
Ontario. We believe that our prospects for a successful resolution are          
strong and that settlement options remain viable.  The action is presently      
scheduled for mediation in the fall of 1999.                                    

 We are also involved in a number of small litigation matters relating
to disagreements with certain of our suppliers, which are currently pending     
and being handled by our in-house counsel. These matters are neither            
significant nor material.                                                       

DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS    

Our directors and executive officers are as follows:                

                                                        [Enlarge/Download Table]

Name                         Age     Position                                        
---------------------------------------------                                        

                                                                                     
Raja S. Tuli                 33      President, Chief Executive Officer and Director 

Willem J. Botha              63      Chief Financial Officer and Treasurer           

Suneet S. Tuli               31      Executive Vice President, Secretary and Director

Lt. Colonel K.C. Sharma      58      Director                                        

Dr. Ajit Singh               58      Director                                        

Bruce D. Vallillee           78      Director                                        

Raja S. Tuli, our founder, has been President, Chief Executive      
Officer and a director since Widecom's inception. From June 1990 to August      
1993, Mr. Tuli was also our Treasurer. From 1987 to 1990 Mr. Tuli was           
President of CaCE Ltd. a family-owned architectural/construction business.      
Mr. Tuli received a bachelor of Science degree in Computer Engineering in       
1988 from the University of Alberta. Mr. Tuli is a resident Canadian            
national. Mr. Tuli is the brother of Suneet S. Tuli.                            

Willem J. Botha has been our Chief Financial Officer and Treasurer  
since September 1993. From 1989 to September 1993, Mr. Botha was an             
independent accounting consultant. From 1985 to 1989, Mr. Botha was             
employed by Motorola Information Systems, a manufacturer of data                
communications equipment, as its Director of Accounting Services. From 1982     
to 1985, Mr. Botha was an independent financial consultant. Mr. Botha was       
the Secretary and Treasurer and a Director of Alcon Canada Inc., a              
pharmaceutical company, from 1980 to 1982. From 1976 to 1980, Mr. Botha was     
the Controller and Chief Financial Officer for Bell & Howell Limited, a         
manufacturer of electronic photographic products, and from 1969 to 1976 Mr.     
Botha was the Controller for Wyeth Ltd., a pharmaceutical company. Mr.          
Botha received a Certificate in Theory of Accounting from the University of     
South Africa, is a Chartered Accountant and a resident Canadian national.       

Suneet S. Tuli has been Executive Vice President of Sales and       
Marketing, Secretary since September 1993, one of our director's since          
October 1992 and was our Marketing manager from June 1990 to August 1993.       
Mr. Tuli received a Bachelor of Science degree in Civil Engineering from        
the University of Toronto in April 1990 and is a resident Canadian              
national. Mr. Tuli is the brother of Raja S. Tuli.                              

Lieutenant Colonel Kailash Chander Sharma is one of our independent 
directors.  Lieutenant Colonel Sharma is a well-respected citizen of India      
and possesses a Masters Degree in Political Science from Delhi University.      
Lt.Col. Sharma has a lengthy military background occupying several senior       
posts with significant levels of responsibility including strategic             
planning and public relations.  Lt. Col. Sharma is proficient in government     
organizational and regulatory matters and runs his own consulting company       
providing services to business and government entities.                         

 Dr. Ajit Singh has been a director of Widecom since October 1992. Dr.
Singh is the Senior Fellow at Queens' College, University of Cambridge in       
England, and its Director of Studies in Economics. Since 1987, Dr. Singh        
has held the Dr. William M. Scholl Visiting Chair in the Department of          
Economics at the University of Notre Dame in the United States. Dr. Singh       
has been a senior economic advisor to the governments of Mexico and             
Tanzania, and is the author of Takeovers, Their Relevance to the Stock          
Market and the "Theory of the Firm." Dr. Singh is the uncle of Raja and         
Suneet S. Tuli.                                                                 

Bruce D. Vallillee has been a director of Widecom since September   
1995. Since April 1994, Mr. Vallillee has been President of Vallillee Wide      
Format Products, Ltd., a company engaged in wide format document management     
and equipment sales. From 1987 to 1994, Mr. Vallillee was the President of      
Vallillee Electronics, Ltd., a company engaged in the distribution of           
electronic products. From 1976 to 1987, Mr. Vallillee was Vice President -      
Sales and Marketing for ITT / Canon Canada, the Canadian joint venture of       
ITT Corporation and Canon Electronics Corp. Mr. Vallillee is a resident         
Canadian national.                                                              

Under Ontario law, a majority of our directors must be resident     
Canadians. A resident Canadian is defined, generally, to be an individual       
who is                                                                          

*  a Canadian citizen ordinarily resident in Canada,                            

*  a Canadian citizen not ordinarily resident in Canada who is a member of      
a prescribed class of persons, or                                               

*  a permanent resident within the meaning of the Immigration Act (Canada),     
and ordinarily resident in Canada.                                              

All directors hold office until the next annual meeting of          
shareholders and the election and qualification of their successors.  There     
is only one currently standing committee of the Board of Directors, that        
being the Audit Committee chaired by our chief financial officer.  Officers     
are elected annually by the Board of Directors and serve at the discretion      
of the Board.                                                                   

None of our directors received any compensation for services as a   
director during our fiscal year ended March 31, 1999. Directors who are         
Widecom employees receive no compensation for serving on the Board of           
Directors.  Non-employee directors are reimbursed for their out-of-pocket       
expenses in attending Board meetings and a per diem of $1,000.                  

EXECUTIVE COMPENSATION    

The following table sets forth the compensation we have paid or     
accrued for the benefit of those persons earning over $80,000.00 USD and        
serving as one of our corporate officers for the year ended March 31, 1999:     

1999 Summary Compensation Table   

Annual Compensation   

                                                                [Download Table]

                            Salary       Other Annual      All Other       
Name                  And Commissions    Compensation    Compensation      
---------------------------------------------------------------------      

                                                                           
Raja S. Tuli              $ 5,849          9,310(1)       $84,130(2)       
(President & C.E.O.)                                                       

Suneet S. Tuli            $34,551          7,980(1)       $52,440(3)       
Secretary, V.P.-                                                           
Sales & Marketing)                                                         

<FN>                                                                       
--------------------                                                       
<F1>  Amounts paid as consulting fees by Widecom to a consulting company   
      owned by our respective officers for the year ended March 31, 1999.  

<F2>  Mr. Raja S. Tuli received shares of Widecom common stock in lieu of  
      cash compensation valued at $84,130.                                 

<F3>  Mr. Suneet S. Tuli received shares of Widecom common stock in lieu of
      cash compensation valued at $52,440.                                 
</FN>                                                                      

During the fiscal year ended March 31, 1997, we amended our employee
stock option plan that allows issuance of options to purchase up to 125,000     
shares of Widecom's stock.  The plan is designed to attract, retain and         
motivate persons to provide us with services and to increase the alignment      
of their interests with those of our stockholders.                              

The plan allows the board of directors, at its discretion, to grant 
options to purchase shares of our common stock at the fair market value of      
such shares on the date the option was granted. Options may be granted to       
any eligible person, including any of our directors, officers, employees or     
those of an affiliate, or any of our consultants or insiders, as defined in     
the plan, of any of our affiliates. The board also has the authority under      
the plan to determine the number of shares subject to each option, the          
expiration date of each option and the extent to which each option is           
exercisable from time to time during its term.                                  

 The options will expire ten years after the date they are granted, or
at such other date as may be provided for in the plan. Individual option        
agreements may allow an optionee who retires or terminates service with the     
consent of the board of directors to exercise his or her option within six      
months of such retirement or termination. If the optionee is terminated for     
cause, the optionee may not exercise the option following such termination.     
The present exercise price of those options is US$8.50.                         

An aggregate of 125,000 shares of common stock, subject to          
adjustment, were available under the plan and such shares subject to            
options which terminate unexercised will be available for future option         
grants.  At present, options to purchase 114,583 shares of common stock         
have been granted.  Options have been previously granted to our principals,     
as follows:                                                                     

*     Raja Tuli was granted options to purchase 37,500 shares in 1995 and       
options to purchase 6,250 shares in 1997;                           

*     Suneet Tuli was granted options to purchase 12,500 shares in 1995         
and options to purchase 6,250 shares in 1997; and                   

*     Lakhbir Tuli was granted options to purchase 18,750 shares in 1997.       

AGGREGATED OPTION/SAR EXERCISES IN LAST   
FISCAL YEAR AND FY-END OPTION/SAR VALUES    

The following table contains information with respect to the named  
executive officers concerning options held as of the year ended March 31,       
1999.                                                                           

OPTION GRANTS IN LAST   
FISCAL YEAR   

                                                                [Download Table]

                            Percent of                                        
                 Number of    Total                                           
                  Shares     Options                                          
                Underlying  Granted in                                        
                 Options      Fiscal                                          
Name             Granted       Year     Exercise Price ($/Sh)  Expiration Date
----            ----------  ----------  ---------------------  ---------------

                                                                              
Raja S. Tuli        0           --                --                  --      

Suneet S. Tuli      0           --                --                  --      

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL    
OWNERS AND MANAGEMENT   

 The following table sets forth, as of September 28, 1999, information
as to (i) the common stock beneficially owned by all directors, nominees        
and named executive officers, (ii) the common stock beneficially owned by       
any person who is known by us to be the beneficial owner of more than five      
percent of our common stock.                                                    

                                                                [Download Table]

                                                                  Amount and  
                                               Nature of         Percentage of
                                               Beneficial         Outstanding 
Name and Address of Beneficial Owner (1)      Ownership (2)      Shares Owned 
----------------------------------------      -------------      -------------

                                                                              
Raja S. Tuli                                   493,377(3)             19.14%  
Lakhbir S. Tuli                                243,915(5)              9.46   
Suneet S. Tuli                                 207,649(4)              8.06   
Dr. Ajit Singh                                     ---                  ---   
Bruce Vallillee                                    ---                  ---   
Willem J. Botha                                    ---                  ---   

All executive officers and directors                                          
 as a group (six persons)                      944,941(2)(3)(4)(5)    36.66%  

<FN>                                                                          
--------------------                                                          

<F1>  Unless otherwise indicated, the business address of each beneficial     
      owner is 72 Devon Road, Unit #18, Brampton, Ontario, Canada, L6T 5B4.   

<F2>  Except as indicated by footnote, the persons named in the table have    
      sole voting and investment power with respect to all shares of common   
      stock shown as beneficially owned by them. Each beneficial owner's      
      percentage ownership is determined by assuming that convertible         
      securities, options or warrants that are held by him, but not those     
      held by any other person, and which are exercisable within 60 days      
      of the date hereof have been exercised.                                 

<F3>  Includes:                                                               
*     43,750 shares of common stock issuable upon exercise of currently       
      exercisable options at a price of $8.50 per share;                      
*     12,500 shares issuable upon exercise of currently exercisable warrant at
      a price of $8.50 per share;                                             
*     8,125 shares owned by Diversified Investors Capital Services of North   
      America, Inc., a New York corporation;                                  
*     16,875 shares owned by Pyrotech Limited, a Cayman Islands corporation;  
      and                                                                     
*     1,223 shares owned by Donald J. Schattle, respectively, as to which Mr. 
      Tuli has voting rights according to the terms of a stock exchange       
      agreement.                                                              

<F4>  Includes:                                                               
*     18,750 shares of common stock issuable upon exercise of currently       
      exercisable options at a price of $8.50 per share; and                  
*     12,500 shares issuable upon exercise of currently exercisable warrant at
      a price of $8.50 per share.                                             

<F5>  Includes 18,750 shares of common stock issuable upon exercise of        
      currently exercisable options at a price of $8.50 per share.            
</FN>                                                                         

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS    

As of January 30, 1997, we announced that we had finalized a joint  
venture agreement with Societe Innovatech du Grand Montreal, an                 
instrumentality of the Province of Quebec, Canada.  Each of Widecom and         
Innovatech purchased 450 shares of the Class A common stock of NovImage         
Inc., a Quebec corporation, for a purchase price of approximately US            
$1,875,000 each.  The consideration we paid for the stock of NovImage was       
in cash and was derived from our working capital.  In addition, two other       
corporations, 3294412 Canada Inc., a Quebec corporation and 3294421 Canada      
Inc., a Quebec corporation, each acquired 50 shares of the Class A common       
stock of NovImage in exchange for the transfer to NovImage of certain           
patents, patent applications and other technology and intellectual property     
rights of those companies.  The value of these patents and property rights      
were CN$ 277,778 for each company.  These latter two companies are wholly-      
owned by Raja S.Tuli, our President and Chief Executive Officer.                

In connection with the transaction, we licensed all of our patents, 
software and technology relating to our scanner and plotter manufacturing       
to NovImage for research and development purposes in order to develop           
improvements, modifications, additions or alterations to the Intellectual       
Property and to develop new products.                                           

 In exchange for this license and the payment of a 0.5% royalty fee on
net revenue, licensing revenue and net sales to sub-licensees, NovImage         
granted us an exclusive perpetual worldwide license, except for the             
Province of Quebec, to use such improved scanner and plotter technology and     
software to manufacture, distribute, market and sell the improved scanner,      
plotter and software, and any new products developed by NovImage.  NovImage     
retained such rights with respect to the Province of Quebec, Canada.            
Because NovImage has not made any sales in Quebec, and we have all              
marketing and sales rights outside Quebec, we have not paid any royalty         
fees to NovImage.                                                               

In the fiscal year ended March 31, 1999, we made loans to NovImage  
totaling $196,034.                                                              

In connection with the transaction, we entered into a Stock Exchange
Agreement with Innovatech under which Innovatech would be permitted, under      
certain circumstances, to exchange its shares of NovImage for up to 63,250      
shares of Widecom's common stock.  The market value of these shares as of       
the date of acquisition was $482,281.25.  This amount changes with              
fluctuations in the market price of our common stock. The Stock Exchange        
Agreement also granted Innovatech demand-registration rights should it          
acquire shares of our common stock.  This amount represents less than 5% of     
our outstanding shares and is accordingly omitted from the table of             
beneficial ownership.                                                           

During fiscal 1999, Raja S. Tuli Consulting loaned us a total of    
$25,333 in order to relieve cash flow pressure for three specific payroll       
periods.  We have repaid that indebtedness by way of board of directors         
approval of a transfer of 11,893 of our common shares.                          

 During fiscal 1999, we made loans to shareholders aggregating $29,384
and loans to affiliates totaling $64,939.  All loans are interest free and      
have no fixed term.  Our loan to NovImage is repayable on demand.               

During fiscal 1999, we decided, in consultation with counsel and    
investment market entities, to add additional technology assets to our          
portfolio. Specifically, we felt that we would benefit from exposure to a       
wider spectrum of available computer peripherals outside the wide format        
niche.  Our management decided that it would be in our best interest to         
acquire a small format photo printer technology developed by a corporation      
owned by Raja S. Tuli.  Management agreed in principle to the acquisition       
on September 11, 1998 which was subsequently approved by a vote of the          
independent shareholders on January 27, 1999.  This acquisition was             
financed by the issuance of 125,000 shares of our common stock.                 

In May, 1999, we accepted the surrender of 4,010 shares of common   
stock from Suneet S. Tuli, one of our principals, in satisfaction of            
indebtedness owed to us.  The value of these shares was capped at CN$44,437     
and the value of the applicable indebtedness was CN$45,000.                     

 In April, 1999, we issued a total of 61,618 shares of common stock to
two consulting companies run by our affiliates in full satisfaction of          
indebtedness owned to those entities.  In addition, in fiscal 1999, we          
issued 294,117 shares of common stock to three of our principals in full        
satisfaction of indebtedness owed to them.                                      

Although we believe that the foregoing transactions were on terms no
less favorable than would have been available from unaffiliated third           
parties in arm's length transaction, there can be no assurance that this is     
the case. All future transaction and loans between us and our officers,         
directors and 5% shareholders will be on terms no less favorable than could     
be obtained from independent, third parties and will be approved by a           
majority of the independent and disinterested members of the Board of           
Directors.  There can be no assurance, however, that future transactions or     
arrangements between us and our affiliates will be advantageous, that           
conflicts of interest will not arise with respect thereto or that if            
conflicts do arise, that they will be resolved in our favor.                    

DESCRIPTION OF SECURITIES   

Common Stock                                                                    

We are authorized to issue 5,000,000 shares of common stock, par    
value $.01 per share.  The holders of common stock are entitled to one vote     
for each share held of record on each matter submitted to a vote of             
shareholders and do not have cumulative voting rights.  The common stock        
has no conversion rights and includes no preemptive rights or other rights      
to subscribe for additional securities.  The holders of the common stock        
will be entitled to receive dividends, if any, as may be declared by the        
board of directors out of legally available funds and to share according to     
their ownership in any distribution to the shareholders, including any          
distribution upon liquidation of Widecom.                                       

Redeemable Warrants                                                             

In December 1995 we completed our initial public offering.  The     
public offering consisted of 1,650,000 shares of common stock and               
redeemable warrants to purchase 1,650,000 shares of common stock, not           
accounting for the reverse stock split.  Accounting for the reverse             
stock split, four warrants must be exercised to purchase one share of           
common stock.                                                                   

The warrants are exercisable at any time until December 15, 2000,   
each with an initial exercise price of $16.00, subject to adjustment in         
certain circumstances. Upon notice to the warrant holders, we could extend      
the expiration date of the warrants or reduce their exercise price.  On         
July 16, 1999 we decided to reduce the exercise price of the warrants.          
The warrants are now exercisable at a price of $5.00 per share for a period     
of 120 days from the effective date of this registration statement and          
$10.00 thereafter.                                                              

The warrants were redeemable by us, with the consent of the         
underwriter in the December 1995 public offering, at any time commencing        
December 15, 1996, upon notice of not less than 30 days, at a price of $.l0     
per warrant, provided that the closing bid quotation of our common stock on     
all 20 trading days ending on the third day prior to the day on which we        
give notice has been at least 187.5%. The holders of the warrants shall         
have the right to exercise their warrants until the close of business on        
the date fixed for redemption. We are a party to an agreement with American     
Stock Transfer & Trust Company, as warrant agent governing the terms of the     
warrants. The exercise price and number of shares of common stock or other      
securities issuable on exercise of the warrant's are subject to adjustment      
under certain circumstances, including in the event of a stock dividend,        
recapitalization, reorganization, merger or consolidation. The warrants,        
however, are not subject to adjustment for issuances of common stock at         
prices below the exercise price of the warrants.                                

The holders of the warrants do not have the rights or privileges of 
holders of common stock.                                                        

12% Convertible Notes                                                           

The following discussion is subject to the terms and conditions of  
the note, a copy of which appears as an exhibit to the registration             
statement.  Investors are referred to the note for more detailed                
information.                                                                    

 Maturity Date.  The notes are due and payable in full three (3) years
after the date of issuance, subject to earlier redemption or conversion.        

Interest.  Interest will be payable from the date of issuance at a  
rate of twelve percent (12%) per annum, based upon a 360 day year, and is       
payable quarterly in cash (US dollars) commencing on March 31, 1999 until       
maturity or prior redemption or conversion.                                     

Conversion.  During a 30 day period commencing 180 days after the   
closing, one-half of the principal amount of each note is convertible into      
shares of common stock, at a conversion price of $4.00.  The remaining          
principal amount of the notes may be converted at any time after 360 days       
from the initial closing date.                                                  

No fractional shares of common stock will be issued and a cash      
adjustment will be made in lieu thereof.  No adjustment for interest will       
be made on conversion of any note.  Accordingly, accrued interest will not      
be paid on a note if it is converted between an interest payment date and       
the next record date for interest payments.  However, any unpaid interest       
accruing prior to the interest payment due immediately preceding the            
conversion will be paid by us.  A holder who converts his note will be          
deemed to have waived, as of the date of conversion, any default existing       
under the note prior to conversion, except the payment of accrued interest.     
In the case of notes called for redemption, conversion rights will expire       
at 5:00 P.M. (New York time) on the business day immediately preceding the      
date fixed for redemption.                                                      

The conversion price is subject to adjustment upon the occurrence of
certain events, including the subdivision of Widecom, split of our common       
stock or the issuance of a dividend or distribution on the common stock;        
subdivisions and combinations of common stock; reclassifications,               
consolidations, mergers and sales of property; the issuance to all holders      
of common stock of certain rights; and the distribution to all holders of       
common stock of evidence of indebtedness or assets.  Except as stated           
above, the conversion price will not be adjusted for the issuance of common     
stock or any securities convertible into or exchangeable for common stock,      
or carrying the right to purchase any of the foregoing, in exchange for         
cash, property or services.                                                     

Redemption.  The Notes are redeemable, in whole or in part, at our  
option, provided that:                                                          

*     the conversion shares are registered for resale under the Act;            

*     during the 20 consecutive trading days ending within 10 days of the date  
  of any notice of redemption, the closing bid price of the common stock
is not less than 150% of the conversion price; and                  

*     the trading volume of the common stock is not less than 30,000 shares     
per day.                                                            

The redemption price shall be equal to the principal amount of the  
Note then outstanding plus all accrued and unpaid interest.                     

No Sinking Fund.  We are not required to provide for the retirement 
or redemption of the notes through the operation of a sinking fund.             

 Registration Rights.  We have agreed to register for resale under the
Act the the conversion shares in a registration statement to be filed 60        
days after the final closing of the offering and to cause the registration      
statement to become effective 120 days after the filing of the registration     
statement.  In the event that we fail either to cause the registration          
statement to be filed under the Act 60 days after the final closing, or         
cause the registration to become effective 120 days after the filing of the     
registration statement, then we shall issue to each holder 1,000 additional     
shares of common stock per unit held for each thirty-day period following       
the 60 days after the final closing that the registration statement is not      
filed and 1,000 additional shares of common stock per unit held for each        
thirty-day period following the 120 days after the filing of the                
registration statement that the registration is not effective, except where     
such failure is due solely to actions of the Commission.                        

We shall bear all costs and expenses of the registration, except for
commissions and costs and expenses of counsel to the holders.  In               
connection with filing the registration statement, note holders will be         
required to furnish certain information to us and to indemnify us against       
certain civil liabilities, including liabilities arising under the Act with     
respect to such information.                                                    

In connection with the registration process, we are required only to
use our best efforts to cause the conversion shares covered by the              
registration statement to be registered or otherwise qualified for sale in      
the states designated by the note holders. It may in fact not be                
practicable to qualify these securities for sale in every state in which        
holders of the conversion shares reside.  Accordingly, it is possible that      
the substantial restrictions on the transferability of the conversion           
shares will continue, even after registration.                                  

Subordination. The notes are subordinated to all senior indebtedness
except to the extent of the collateral.  As defined in the notes, senior        
indebtedness is all of our indebtedness, liabilities and obligations for        
money borrowed from banks, savings and loan associations, the Small             
Business Administration and other financial institutions, and their             
affiliates.  No payment or distribution of any kind or character on account     
of principal, premium, if any, or interest on this note shall be permitted      
during the continuance of any default in the payment of principal, premium,     
if any, or interest on any senior indebtedness.                                 

Security Interest.                                                              

To secure the due payment and performance of all indebtedness and   
other liabilities and obligations of us to the holders, we assigned to the      
holder a first priority lien upon all of the following of our assets:           

*     accounts receivable, including                                            

*     all of our and our subsidiaries' present and future accounts, 
contract rights, general intangibles, chattel paper and 
        instruments, as such terms are defined in the Uniform Commercial
Code;                                                   
*     all of our and our                                            
 *     subsidiaries' right, title and interest, and all of our and our
         subsidiaries' rights, remedies, security and liens, in, to and in
respect of any accounts receivable; and                 
   *     all of our and our subsidiaries' right, title and interest in, to
         and in respect of all goods resulting in accounts receivable; and

*     proceeds, including                                                       

    *     any consideration received from the sale, exchange, lease or other
          disposition of any asset or property which constitutes collateral;
*     any value received as a consequence of the possession of any  
     collateral and any payment received from any insurer or other
       person or entity as a result of the destruction, loss, theft or
   other involuntary conversion of any asset or property which
constitutes collateral; and                             
    *     all cash and negotiable instruments received or held by us and our
   subsidiaries pursuant to any lockbox or similar arrangement
relating to the payment of accounts receivable.         

LEGAL MATTERS   

Certain legal matters relating to our common stock will be passed   
upon for us by the law firm of Goldstein & DiGioia, LLP, New York, New          
York.  Members of the firm of Goldstein & DiGioia, LLP owns Shares of our       
common stock registered in this prospectus.                                     

EXPERTS   

The financial statements and schedules included in this prospectus  
have been audited by Schwartz, Levitsky, Feldman, LLP, independent              
certified public accountants, to the extent and for the periods indicated       
in their reports with respect thereto.                                          

CHANGES IN ACCOUNTANTS    

On June 15, 1999, our board of directors determined that it would be            
in the our best interests to cease our relationship with our independent        
accountant and auditors, BDO Dunwoody, LLP, which acted as our independent      
accountant and auditors with respect to the our financial statements for        
the previous two fiscal years ended March 31, 1998.                             

The replacement of BDO Dunwoody, LLP was recommended and approved by
our Board of Directors and is not the result of any disagreement with BDO       
Dunwoody, LLP on any matter of accounting principles or practice, financial     
statement disclosure or auditing scope or procedure.  The replacement was       
necessitated since BDO Dunwoody, LLP declined to stand for re-election.         

During the last two fiscal years no report issued by BDO Dunwoody,  
LLP contained any adverse opinion or a disclaimer of opinion, or was            
qualified or modified as to uncertainty, audit scope, or accounting             
principles.  In addition, during the last two fiscal years and subsequent       
periods, there were no disagreements with BDO Dunwoody, LLP regarding           
accounting principles, or practices, financial statement disclosure, or         
auditing scope or procedure nor any dispute between Widecom and BDO             
Dunwoody, LLP with respect to Widecom's status as a "going concern."            

Effective June 15, 1999, our board of directors determined that it  
would be in our best interests to retain the services of Schwartz,              
Levitsky, Feldman, LLP to replace BDO Dunwoody, LLP as our independent          
accountant and auditors.  The firm has audited our financial statements         
included our Form 10-KSB for our fiscal year ended March 31, 1999 and filed     
with the Securities and Exchange Commission.                                    

We intend to have Schwartz, Levitsky, Feldman, LLP continue to serve
as our accountant and auditors for the fiscal year ending March 31, 2000.       

During the last two fiscal years and subsequent periods, Widecom did
not consult with Schwartz, Levitsky, Feldman, LLP regarding accounting          
principles, or practices, financial statement disclosure, or auditing scope     
or procedure or accounting principles applicable to any specific                
transaction.                                                                    

DISCLOSURE OF COMMISSION ON INDEMNIFICATION   
FOR SECURITIES ACT LIABILITIES    

Indemnification may be permitted to directors, officers, employees  
and agents of a corporation under certain circumstances and subject to          
certain limitations under Part IX of the Ontario Business Corporation Act       
and the our By-laws.                                                            

With respect to indemnification for liabilities arising under the   
Securities Act may be permitted to directors, officers or persons               
controlling Widecom, under the foregoing provisions, we have been informed      
that in the opinion of the Securities and Exchange Commission                   
indemnification is against public policy as expressed in the Securities Act     
and is therefore unenforceable.                                                 

Except for the payment by us of expenses incurred or paid by any of 
our directors, officers or controlling persons in the successful defense of     
any action, suit or proceeding, in the event that a claim for                   
indemnification against liabilities is asserted by a director, officer or       
controlling person in connection with the securities being registered, we       
will, unless in the opinion of our counsel the matter is settled by             
controlling precedent, submit to a court of appropriate jurisdiction the        
question whether indemnification by us is against public policy as              
expressed in the Securities Act and will be governed by final adjudication      
of the issue.                                                                   

MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS    

Our common stock and public warrants are quoted on the Nasdaq       
SmallCap Market under the symbols "WIDE" and "WIDWF", respectively, and on      
the Boston Stock Exchange under the symbols "WDE" and "WDEW," respectively.     
The table below represents the quarterly high and low closing prices for        
our common stock and warrants as reported through March 31, 1999 and June       
29, 1999.  The prices listed in this table reflect quotations without           
adjustment for retail mark-ups, mark-downs, or commissions.  We have not        
paid any cash dividends since inception, and intend to retain earnings, if      
any, in the foreseeable future for use in our continued expansion. The          
approximate number of registered holders of record of our common stock and      
warrants at March 31, 1999 was 65 and 14. Our advisers firmly believe that      
the actual number of beneficial holders of our common stock and warrants is     
in excess of 500.                                                               

                                                                [Download Table]

                                        Common Stock             Warrants      
                                       --------------         --------------   
                                       High       Low         High       Low   
                                       ----       ---         ----       ---   

                                                                               
1997                                                                           
First Quarter (Jan.1-Mar.31/97)        45 1/2      13         28          1    
Second Quarter (Apr.1-Jun.30/97)       18 1/2       7          7          2 1/2
Third Quarter (Jul.1-Sept.30/97)       15 1/2       7          4          1 3/4
Fourth Quarter(Oct.1-Dec.31/97)        10           3 1/2      3 3/4      1 1/2

1998                                                                           
First Quarter (Jan.1-Mar.31/98)         7           2 1/2      1 1/2        1/2
Second Quarter (Apr.1-June 30/98)       4 1/2       2 1/2        1/2        1/2
Third Quarter (July 1-Sept.30/98)       2             1/2                      
Fourth Quarter (Oct.1-Dec.31/98)        1 7/8         15/16                    

1999  (1:4 Reverse Split-January 29/99)                                        
First Quarter (Jan.1-Mar.31/99)         2 3/4       1 1/4                      
Second Quarter (Apr.1-June 30/99)      10 1/2       1 1/4                      

PLAN OF DISTRIBUTION    

The shares of common stock, including the shares underlying the     
public and private warrants, may be offered and sold from time to time by       
the selling shareholders as market conditions permit in the over-the-           
counter market, or otherwise, at prices and terms then prevailing or at         
prices related to the then-current market price, or in negotiated               
transactions.                                                                   

The shares registered hereby may be sold by one or more of the      
following methods, without limitation:                                          

*     a block trade in which a broker or dealer so engaged will attempt to      
 sell the shares as agent but may position and resell a portion of the
block as principal to facilitate the transaction;                   

*     purchases by a broker or dealer as principal and resale by such broker    
or dealer for its account through this prospectus;                  

*     ordinary brokerage transactions and transactions in which the broker      
solicits purchasers; and                                            

*     face-to-face transactions between sellers and purchasers without a        
broker-dealer.                                                      

In effecting sales, brokers or dealers engaged by the selling       
shareholders may arrange for other brokers or dealers to participate.           
Brokers or dealers may receive commissions or discounts from the selling        
shareholders in amounts to be negotiated immediately prior to the sale.         
These brokers and dealers and any other participating brokers or dealers        
may be deemed to be underwriters within the meaning of the Securities Act       
of 1933, in connection with such sales.                                         

FORWARD LOOKING STATEMENTS    

Certain statements in this prospectus constitute forward-looking    
statements within the meaning of the Private Securities Litigation Reform       
Act of 1995.  We desire to avail ourselves of certain safe harbor               
provisions of the 1995 Reform Act and are therefore including this special      
note to enable us to do so. Forward-looking statements included in this         
prospectus or hereafter included in other publicly available documents          
filed with the Securities and Exchange Commission, reports to our               
stockholders and other publicly available statements issued or released by      
us involve known and unknown risks, uncertainties, and other factors which      
could cause our actual results, performance, either financial or operating,     
or achievements to differ from the future results, performance, either          
financial or operating, achievements expressed or implied by those forward      
looking statements.  These future results are based upon management's best      
estimates of current conditions and the most recent results of our              
operations.                                                                     

The statements appear in a number of places in this prospectus and  
include statements regarding our intent, belief or current expectations,        
and those of our directors or officers with respect to:                         

*     future revenues,                                                          
*     product development,                                                      
*     the future of the wide format document system industry, and               
*     other matters.                                                            

Our actual results could differ materially from those anticipated in
the forward looking statements as a result of certain factors, including        
those discussed throughout this prospectus. These risks include, but are        
not limited to, risks associated with recent and accumulated losses,            
competition, conflicts of interest, limited operating history, dependence       
upon one product line, and other risks detailed in this prospectus and our      
Securities and Exchange Commission filings, including our Annual Report on      
Form 10-KSB, Form 10-QSB as well as recently filed Reports on Form 8-K, if      
any, each of which could adversely affect our business and the accuracy of      
the forward looking statements contained herein.                                

INDEX TO FINANCIAL STATEMENTS   

Unaudited Financial Statements                                                  
------------------------------                                                  

Balance Sheets                                                        F-2       

Statements of Operations                                              F-3       

Statements of Cash Flow                                               F-4       

Notes to Financial Statements                                         F-5       

Audited Financial Statements                                                    
----------------------------                                                    

Consent of Accountants on Audited Financial Statements                F-6       

Report of Accountants                                                 F-7       

Balance Sheets                                                        F-8       

Statements of Operations                                              F-9       

Statements of Stockholders' Equity                                    F-10      

Statements of Cash Flows                                              F-11      

Notes to Financial Statements                                         F-12      

THE WIDECOM GROUP INC.    
CONSOLIDATED BALANCE SHEET    
(in United States dollars)    

                                                                [Download Table]

                                                        September 30,        
                                                 --------------------------- 
                                                    1999             1998    
                                                    ----             ----    
                                                (unaudited)      (unaudited) 

                                                                             
Assets                                                                       

Current assets                                                               
  Cash and cash equivalents                     $   221,637      $   392,849 
  Accounts receivable                               604,155          585,571 
  Deferred financing charges                         54,083               -  
  Prepaid expenses                                   65,110           89,140 
  Advance to related parties                        201,541          167,767 
  Inventory (Note 3)                              1,407,802        1,730,296 
                                                ---------------------------- 
Total current assets                              2,554,328        2,965,623 

Capital assets (Note 4)                           1,428,644        1,506,737 

Research and development technology                  65,242                - 

Investment in affiliates                            430,308          790,778 
                                                ---------------------------- 

Total assets                                    $ 4,478,522      $ 5,263,138 
                                                ============================ 

Liabilities and Shareholders' Equity                                         

Current liabilities                                                          
  Bank indebtedness                                 123,280          305,398 
  Accounts payable and accrued liabilities          894,572          768,554 
  Loan from related parties                          66,766           13,333 
  Convertible debentures (Note 5)                   350,000          150,000 
                                                ---------------------------- 
Total current liabilities                         1,434,618        1,237,285 
                                                ---------------------------- 

Shareholders' equity                                                         

  Common shares                                 $14,476,808      $13,452,497 
  Contributed surplus                               159,825          159,825 
  Deficit                                       (11,221,718)      (9,377,072)
  Cumulative translation adjustment                (371,011)        (209,397)
                                                  3,043,904        4,025,853 
                                                ---------------------------- 
Total liabilities and shareholders' equity      $ 4,478,522      $ 5,263,138 
                                                ============================ 

See accompanying notes to the consolidated financial statements.                

THE WIDECOM GROUP INC.    
CONSOLIDATED STATEMENTS OF OPERATIONS   
(in United States dollars)    

                                                        [Enlarge/Download Table]

                                        For the three   For the three    For the six     For the six 
                                        Months ended    Months ended    Months ended    Months ended 
                                        September 30,   September 30,   September 30,   September 30,
                                            1999            1998            1999            1998     
                                        -------------   -------------   -------------   -------------
                                         (unaudited)     (unaudited)     (unaudited)     (unaudited) 

                                                                                                     
Product sales                            $  593,692      $  635,955      $1,378,017      $1,254,050  
Cost of product sales                       129,603         168,470         300,952         332,323  
                                         ----------------------------------------------------------  
Gross profit                                464,089         467,485       1,077,065         921,727  

Research and development grants                   -         301,285               -         405,799  
Interest income                               2,734           3,057           3,838          13,281  
                                         ----------------------------------------------------------  
Net revenue                                 466,823         771,827       1,080,903       1,340,807  
                                         ----------------------------------------------------------  

Expenses                                                                                             
  Selling, general and administrative       486,915         743,033         961,019       1,458,674  
  Interest and bank charges                  14,893          19,418          33,004          29,058  
  Management fees and salaries               69,686          81,620         139,372         157,254  
  Amortization                               73,352          89,913         147,798         178,072  
  Foreign exchange loss                           -          28,163               -          49,505  
                                         ----------------------------------------------------------  
Total operating expenses                    644,846         962,147       1,281,193       1,872,563  
                                         ----------------------------------------------------------  

Operating income (loss)                    (178,023)       (190,320)       (200,290)       (531,756) 
                                         ----------------------------------------------------------  

Equity in (loss) of affiliate               (60,879)        (67,055)       (129,092)       (197,333) 

Legal settlement costs                            -               -               -               -  
                                         ----------------------------------------------------------  

Earnings (loss) before extraordinary                                                                 
 item                                      (238,902)       (257,375)       (329,382)       (729,089) 

Extraordinary item, net of tax                    -               -               -               -  
                                         ----------------------------------------------------------  

Net earnings (loss) for the period       $ (238,902)     $ (257,375)     $ (329,382)     $ (729,089) 
                                         ==========================================================  

Loss per common share before                                                                         
 extraordinary item, basic and diluted   $    (0.10)     $    (0.16)     $    (0.14)     $    (0.48) 
                                         ==========================================================  

Loss per common share, basic                                                                         
 and diluted                             $    (0.10)     $    (0.16)     $    (0.14)     $    (0.48) 
                                         ==========================================================  

Weighted average number of shares                                                                    
 outstanding                              2,293,790       1,540,683       2,293,790       1,540,683  
                                         ==========================================================  

See accompanying notes to the consolidated financial statements.                

THE WIDECOM GROUP INC.    
CONSOLIDATED STATEMENTS OF CASH FLOWS   
(in United States dollars)    

                                                                [Download Table]

                                                     For the six months ended   
                                                   -----------------------------
                                                   September 30,   September 30,
                                                      1999             1998     
                                                   -------------   -------------
                                                   (Unaudited)      (Unaudited) 

                                                                                
Cash provided by (used in)                                                      
Operating activities                                                            
Loss for the period before                                                      
 extraordinary item                                $(329,382)       $(729,089)  
Add (deduct) items not requiring a cash outlay                                  
  Amortization                                       147,798          178,072   
  Shares issued to settle lawsuits                   197,150                -   
  Foreign exchange loss                                    -           49,505   
Equity in loss of affiliate                          129,092          197,333   
Net changes in non-cash working capital balances                                
 related to operations                                                          
  (Increase) in accounts receivable                  (35,403)         (50,297)  
  (Increase) in inventory                           (197,997)        (381,311)  
  Increase (decrease) in accounts payable and                                   
   accrued liabilities                              (437,874)          30,529   
  Increase (decrease) in prepaid expenses             22,844           (6,890)  
                                                   --------------------------   
                                                    (503,772)        (712,148)  
                                                   --------------------------   

Investing activities                                                            
  Purchase of capital assets                         (66,468)         (58,835)  
                                                     (66,468)         (58,835)  

Financing activities                                                            
  Increase (decrease) in bank indebtedness          (146,971)         122,971   
  Shares issued for cash                             729,289          200,000   
Loan from related parties                                  -           13,333   
  Convertible debentures                              15,000                -   
                                                   --------------------------   
                                                     597,318          336,304   
                                                   --------------------------   

Effect of exchange rate changes on cash               38,366          134,695   
                                                   --------------------------   
Net increase (decrease) in cash during the period     65,444         (299,984)  

Cash and equivalents, beginning of period            156,193          692,833   
                                                   --------------------------   

Cash and equivalents, end of period                $ 221,637        $ 392,849   
                                                   ==========================   

See accompanying notes to the consolidated financial statements.                

THE WIDECOM GROUP INC.    

Item 1.  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS                             

1.  Presentation of Interim Information                                         

In the opinion of Management the accompanying unaudited financial statements    
include all normal adjustments necessary to present fairly the financial        
position at September 30, 1999, and the results of operations for the six       
months ended September 30, 1999 and 1998 and cash flows for the six months      
ended September 30, 1999. Interim results are not necessarily indicative of     
results for full year.                                                          

The condensed consolidated financial statements and notes are presented as      
permitted by Form 10QSB and do not contain certain information included in      
the Company's audited consolidated financial statements and notes for the       
fiscal year March 31, 1999.                                                     

2.  Financial Statements                                                        

The consolidated financial statements include the accounts of the Company       
and its wholly owned subsidiary.                                                
All significant intercompany balances, transactions and stockholdings have      
been eliminated.                                                                

3.  Inventories                                                                 

Inventories are summarized as follows:-                                         

                                                                [Download Table]

                           September       September
                           30, 1999        30, 1998 
                           ---------       ---------

                                                    
Raw materials             $  741,547      $1,055,218
Work in progress               8,572          43,842
Finished goods               657,683         631,236
                          --------------------------
Total inventories         $1,407,802      $1,730,296
                          ==========================

4.  Capital Assets                                                              

Capital assets consist of:                                                      

                                                        [Enlarge/Download Table]

                                     September 30, 1999              September 30, 1998   
                               ---------------------------     ---------------------------
                                              Accumulated                     Accumulated 
                                  Cost        Amortization        Cost        Amortization
                                  ----        ------------        ----        ------------

                                                                                          
Machinery, plant and                                                                      
 Computer equipment            $1,972,208      $1,233,151      $1,840,243      $  929,033 
  Furniture and fixtures          111,107          61,188         106,477          47,219 
  Prototype and jigs              297,525         149,458         285,128         111,798 
  Land                             57,846               -          55,436               - 
  Building under construction     433,755               -         307,503               - 
                               ---------------------------------------------------------- 
                               $2,872,441      $1,443,797      $2,594,787      $1,088,050 
                               ========================================================== 

      Net book value                           $1,428,644                      $1,506,737 
                                               ==========                      ========== 

5.  Convertible Debentures                                                      

On May 19,1997, the Company completed a private offering of $250,000 of         
convertible debentures maturing on May 19, 1998. The convertible debentures     
bear interest of 8% per annum. In addition, 12,500* warrants were also          
issued in conjunction with these convertible debentures.  The holder of the     
debentures has the right to convert at a conversion price equal to the lower    
of $5 or 80% of the average closing bid price of the Company's shares over      
the past 20 trading days.  On February 11, 1998, $50,000 principal plus         
accrued interest was converted into 14,742* common shares.  The warrants are    
exercisable over 3 years at an exercise price of $16 per share.  The value      
attributable to the warrants is not material.  Included in accounts payable     
is accrued interest on the debentures of $ 31,588.                              

On April 24, 1998, the debenture holder converted another $50,000 principal     
plus interest into 17,213* of common shares. The company is currently in        
default for the repayment of its remaining  $150,000 convertible debentures     
that came due on May 18, 1998.                                                  

The company also conducted a private placement of ten specific investment       
units, each comprising 10,000 common shares and a three-year 12% convertible    
subordinated note in the amount of $20,000.  Interest payments are payable      
quarterly and conversion is available at an exercise price of $1.00 per         
share.  One-half of the principal amount of the note is exercisable during      
the 30-day period commencing 180 days from the initial closing on February      
19, 1999. The remaining principal amount is convertible at anytime following    
360 days after the initial closing.  Nine and one-half units closed in our      
preceding quarter, however, one-half unit closed during the first quarter of    
fiscal 2000. Included in accounts payable is accrued interest on the            
debentures of $13,990.                                                          

*     Adjusted to reflect a one-for-four reverse stock split of Widcom's        
common shares effective January 29, 1999.                           

6.  Contingent Liabilities                                                      

(a)  Widecom has been served with an action claiming breach of contract         
regarding Widecom's rights under two specific joint venture and development     
agreements to use and distribute various iterations of software components      
allegedly the sole property of the claimant. The action claims damages for      
breach of contract along with copyright and trademark infringement as a         
result.  The claim, as filed, seeks a total of $15.85 Million in damages and    
is in progress in the Superior Court of Justice in the Province of Ontario.     
Resolution options remain open and the action is presently scheduled for        
mediation in December 1999.                                                     

(b)  In December 1996, two individuals filed a lawsuit seeking 60,000 shares    
and 40,000 warrants.  This action has been formally dismissed.  An              
additional three (3) shareholders have also commenced related litigation,       
alleging purchase of our securities from the previously noted two               
individuals, who are as co-defendants.  We have filed and received default      
on our cross-claims against the two individual co-defendants.  The total        
number of shares of common stock claimed under these suits is less than         
15,000.                                                                         

Loss, if any, on the above claims will be recorded when settlement is           
probable and the amount of the settlement is estimable.                         

Schartz Levitsky Feldman llp                                                    
CHARTERED ACCOUNTANTS                                                           
TORONTO, MONTREAL, OTTAWA                                                       

AUDITORS' REPORT                                                                

To the Shareholders of                                                          
The WideCom Group Inc.                                                          

We have audited the consolidated balance sheet of The WideCom Group Inc. as     
at March 31, 1999 and the consolidated statements of operations,                
shareholders' equity and cash flows for the year ended March 31, 1999.          
These consolidated financial statements are the responsibility of the           
Company's management.  Our responsibility is to express an opinion on these     
consolidated financial statements based on our audit.                           

We conducted our audit in accordance with generally accepted auditing           
standards.  Those standards require that we plan and perform an audit to        
obtain reasonable assurance whether the consolidated financial statements       
are free of material misstatement.  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 financial statement presentation.                        

In our opinion, these consolidated financial statements present fairly, in      
all material respects, the financial position of the company as at March 31,    
1999 and the results of its operations and the changes in its cash flows for    
the year ended March 31, 1999 in accordance with generally accepted             
accounting principles in the United States.                                     

The consolidated balance sheet of The WideCom Group Inc. as at March 31,        
1998 and the consolidated statements of operations, shareholders' equity and    
cash flows for the years ended March 31, 1998 and 1997 were audited by          
another firm of Chartered Accountants with an unqualified audit report          
issued thereon.                                                                 

Toronto, Ontario                                                                
July 5, 1999  Chartered Accountants                                             

1167 Caledonia Road                                                             
Toronto, Ontario M6A 2X1                                                        
Tel:   416 785 5353                                                             
Fax:   416 785 5663                                                             

                                            The WideCom Group Inc.
                                       Consolidated Balance sheets
                                        (in United States dollars)

                                                                [Download Table]

March 31                                          1998             1999    
-------------------------------------------------------------------------- 

                                                                           
Assets                                                                     

Current assets                                                             
  Cash and cash equivalents                   $   692,833      $   156,193 
  Accounts receivable (Note 1)                    579,060          552,901 
  Inventory (Note 2)                            1,301,522        1,175,112 
  Prepaid expenses                                 88,947           40,926 
  Advances to related parties (Note 3)            180,930          225,418 
  Deferred financing costs                              -           49,813 
                                              ---------------------------- 
Total current assets                            2,843,292        2,200,363 
Capital assets (Note 4)                         1,749,312        1,453,963 
  Purchased research and development                                       
   technology (Note5)                                   -           78,777 
Investment in affiliate (Note 6)                1,058,586          545,113 
                                              ---------------------------- 
Total assets                                  $ 5,651,190      $ 4,278,216 
                                              ---------------------------- 

Liabilities and Shareholders' Equity                                       

Current Liabilities                                                        
  Bank indebtedness (Note 7)                  $   201,114      $   264,022 
  Accounts payable and accrued                                             
   liabilities (Note 8)                         1,013,132        1,299,454 
  Loans from related parties (Note 3)                   -           64,939 
  Convertible debentures (Note 9)                 200,000          342,478 
                                              ---------------------------- 
Total current liabilities                       1,414,246        1,970,893 
                                              ---------------------------- 

Shareholders' equity (Note 10)                                             
  Common shares                                                            
    5,000,000*  shares authorized of no par                                
                value                                                      
    1,477,320*  shares issued and outstanding                              
                on March 31,1998                                           
    2,068,400*  shares issued and outstanding                              
                on March 31, 1999              12,982,715       13,577,841 
  Contributed surplus                             159,825          159,825 
  Deficit                                      (8,647,983)     (10,892,334)
  Accumulated other comprehensive loss                                     
   (Note 11)                                     (257,613)        (538,009)
                                              ---------------------------- 
                                                4,236,944        2,307,323 
                                              ---------------------------- 
Total liabilities and shareholders' equity    $ 5,651,190      $ 4,278,216 
========================================================================== 

<FN>                                                                       
*  Adjusted for reverse split of Company's stock (1:4) on January 29,1999. 
</FN>                                                                      

See accompanying summary of significant accounting policies and notes     
to these Consolidated Financial Statements                                

                                              The WideCom Group Inc.
                               Consolidated Statements of Operations
                                          (in United States dollars)

                                                        [Enlarge/Download Table]

For the years ended March 31                         1997          1998            1999    
-----------------------------------------------------------------------------------------  

                                                                                           
Revenue                                                                                    
  Product sales                                  $ 1,678,933    $ 2,890,443    $ 2,575,935 
  Research and development grants                          -         24,567        479,821 
  Interest income                                    141,780        138,794         19,853 
                                                 ----------------------------------------- 

Total revenue                                      1,820,713      3,053,804      3,075,609 
                                                 ----------------------------------------- 
Expenses                                                                                   
  Cost of product sales                              459,026        809,935        726,909 
  Research and development                           614,663         99,266        134,248 
  Selling, general and administrative              3,733,016      3,604,538      3,112,056 
  Interest and bank charges                           42,399         49,431         51,504 
  Management fees and salaries                       321,209        398,804        333,743 
  Amortization                                       503,359        489,733        362,108 
  Foreign exchange loss (gain)                             -         36,119        (11,968)
                                                 ----------------------------------------- 
Total expenses                                     5,673,672      5,487,826      4,708,600 
                                                 ----------------------------------------- 
Operating loss                                    (3,852,959)    (2,434,022)    (1,632,991)

Legal settlement costs (Note 15(b))                        -       (309,375)      (158,741)
Equity in loss of affiliate                         (121,971)      (592,468)      (452,619)
Writedown of goodwill                               (576,000)             -              - 
                                                 ----------------------------------------- 
Loss before income taxes                          (4,550,930)    (3,335,865)    (2,244,351)
Provision for (recovery of) income taxes                                                   
 (Note 12)                                                                                 
  Deferred                                           (63,106)             -              - 
                                                 ----------------------------------------- 

Net loss for the year                            $(4,487,824)   $(3,335,865)   $(2,244,351)
                                                 ========================================= 

Loss per common share, basic and                                                           
 diluted (Note 10(f))                                  (3.96)         (2.36)         (1.28)
                                                 ========================================= 
Weighted average number of shares                                                          
 outstanding *                                     1,133,396      1,416,047      1,749,386 
========================================================================================== 

<FN>                                                                                       
*  Adjusted for reverse split of company's stock (1:4) on January 29,1999.                 
</FN>                                                                                      

See accompanying summary of significant accounting policies and notes     
to these Consolidated Financial Statements                                

                                              The WideCom Group Inc.
                     Consolidated Statements of Shareholders' Equity
                                          (in United States dollars)
                      For the years ended March 31, 1997, 1998, 1999

                                                        [Enlarge/Download Table]

                                                                         Retained          Other           Total     
                                           Common      Contributed       Earning       Comprehensive    Shareholders'
                                           Shares        Surplus        (Deficit)          Loss            Equity    
---------------------------------------------------------------------------------------------------------------------

                                                                                                                     
Balance, March 31,1997                    10,598,884      159,825       (5,312,118)       (203,288)       5,243,303  
Exercise of warrants (180,981)*            2,170,179            -                -               -        2,170,179  
Warrant exercise costs                      (120,470)           -                -               -         (120,470) 
Class action settlement (69,625)*            355,158            -                -               -          355,158  
Conversion of convertible                                                                                            
 debentures (14,742)*                         50,000            -                -               -           50,000  
Share issuance costs                         (71,036)           -                -               -          (71,036) 

Net loss for year                                  -            -       (3,335,865)              -       (3,335,865) 

Foreign currency                                                                                                     
 translation adjustment                            -            -                -         (54,325)         (54,325) 
                                         --------------------------------------------------------------------------  
Balance, March 31,1998                   $12,982,715     $159,825      $(8,647,983)      $(257,613)     $ 4,236,944  
Warrant exercise costs reversal               97,907            -                -               -           97,907  
Shares issued for corporate                                                                                          
 indebtedness (294,117)                      200,000            -                -               -          200,000  
Shares issued for investment                                                                                         
 in wholly owned subsidiary (125,000)*        93,750            -                -               -           93,750  

Class action settlement (59,751)*             83,457            -                -               -           83,457  
Conversion of convertible                                                                                            
 debentures  (17,213)*                        50,000            -                -               -           50,000  

Conversion of convertible                                                                                            
 debentures    (95,000)                       95,000            -                -               -           95,000  

Share issuance costs                         (24,988)           -                -               -          (24,988) 
Net loss for year                                  -            -       (2,244,351)              -       (2,244,351) 
Foreign currency translation                                                                                         
 adjustment                                        -            -                -        (280,396)        (280,396) 
                                         --------------------------------------------------------------------------  
Balance, March 31,1999                   $13,577,841     $159,825     $(10,892,334)      $(538,009)     $ 2,307,323  
===================================================================================================================  

<FN>                                                                                                                 
*  Adjusted for reverse slit of Company's Stock (1:4) on January 29,1999.                                            
</FN>                                                                                                                

See accompanying summary of significant accounting policies and notes     
to these Consolidated Financial Statements                                

                                              The WideCom Group Inc.
                               Consolidated Statements of Cash Flows
                                          (in United States dollars)

                                                        [Enlarge/Download Table]

For the years ended March 31                                1997            1998            1999    
--------------------------------------------------------------------------------------------------- 

                                                                                                    
Cash provided by (used in)                                                                          

Operating activities                                                                                
  Loss for the year                                     $(4,487,824)    $(3,335,865)    $(2,244,351)
    Add (deduct) item not requiring a cash outlay                                                   
      Amortization                                          503,359         489,733         362,108 
      Foreign exchange loss (gain)                                -          36,119         (11,968)
      Deferred income taxes recovery                        (63,106)              -               - 
      Shares issued to settle lawsuits                            -         355,158         158,741 
      Writedown of goodwill                                 576,000               -               - 
      Equity in loss of affiliate                           121,971         592,468         452,619 
      Net changes in non-cash                                                                       
       working capital balances related to operations                                               
      Decrease (increase) in accounts receivable           (333,048)        160,122           7,988 
      Decrease in research                                                                          
       and development grants receivable                          -         687,307               - 
      Decrease (increase) in inventory                     (764,646)       (133,663)         49,882 
      Increase (decrease) in accounts payable                                                       
       and accrued liabilities                              982,544        (308,983)        551,213 
      (Decrease) increase in prepaid expenses               (31,453)          8,969         (42,920)
                                                        ------------------------------------------- 
                                                         (3,496,203)     (1,448,635)       (716,688)
                                                        ------------------------------------------- 

Investing activities                                                                                
  Purchase of capital assets                             (1,108,068)       (540,022)       (153,395)
  Advances to related parties                               (32,033)        (67,523)        (55,330)
  Purchases of shares in wholly-owned subsidiary                  -               -         (93,750)
  Purchase of equity in joint venture                    (1,805,836)              -               - 
                                                        ------------------------------------------- 
                                                         (2,945,937)       (607,545)       (302,475)
                                                        ------------------------------------------- 

Financing activities                                                                                
  Increase (decrease) in bank indebtedness                  203,456        (121,954)         75,005 
  Shares and warrants issued                              1,298,090       1,978,673         200,000 
  Loans from related parties                                      -               -          64,939 
  Issuance of convertible debentures                              -         250,000         285,000 
                                                        ------------------------------------------- 
                                                          1,501,546       2,106,719         624,944 
                                                        ------------------------------------------- 
Effect of exchange rate change on cash                      (71,411)         10,808        (142,421)
                                                        ------------------------------------------- 
Net increase (decrease) in cash during the year          (5,012,005)         61,347        (536,640)
Cash and equivalents, beginning of year                   5,643,491         631,486         692,833 
                                                        ------------------------------------------- 
Cash and equivalents, end of year                       $   631,486     $   692,833     $   156,193 
=================================================================================================== 

Note: See note 16 for supplementary information                                 

See accompanying summary of significant accounting policies and notes     
to these Consolidated Financial Statements                                

                                              The WideCom Group Inc.
                          Summary of Significant Accounting Policies
                                          (in United States dollars)

March 31, 1998, and 1999                                                        
--------------------------------------------------------------------------      
Nature of Business      The WideCom Group Inc. ("the Company") was              
              incorporated under the laws of Ontario on June
                   15, 1990.  The Company designs, assembles and sells
                   high speed, high performance document systems which
                  transmit, receive, print, copy and/or archive wide
format documents.               

Basis of Financial      The accompanying consolidated financial statements      
Statements             are stated in United States dollars, "the reporting    
                    currency". The transactions of the Company have been
                  recorded during the year in Canadian dollars, "the
                  functional currency".  The translation of Canadian
                    dollars into United States dollars amounts have been
               made at the year end exchange rates for balance
                 sheet items and the average exchange rate for the
             year for revenues, expenses, gains an losses.
                 Translation adjustments to reporting currency are
        included in equity as "accumulated other
   comprehensive loss". (See Note 11).

             The consolidated financial statements reflect
               retroactively a backsplit occurring during 1999
(See Note 10).                  

                 These consolidated financial statements have been
                   prepared by management in accordance with generally
                    accepted accounting principles in the United States.

Principles of           These consolidated financial statements include the     
Consolidation          accounts of the Company and its wholly-owned           
               subsidiaries Indo WideCom International Ltd and
          Diprin Inc.  All significant inter-company
               transactions and accounts have been eliminated.

Investment in           The investment in affiliate is accounted for on the     
Affiliate              equity basis.                                          

Accounting Estimates    The preparation of consolidated financial               
                 statements, in conformity with generally accepted
                  accounting principles, requires management to make
                  estimates and assumptions that affect the reported
                    amounts of assets and liabilities and disclosures of
                    contingent assets and liabilities at the date of the
                financial statements and the reported amounts of
                  revenues and expenses during the reporting period.
                 Actual results could differ from those estimated.

Inventory               Inventory is valued at the lower of cost, determined    
                 on a first-in, first-out basis, and market value.
            Market value for raw materials is defined as
                    replacement and for finished goods as net realizable
value.                          

Long-lived Assets       Management reviews long-lived assets and certain        
                identifiable intangibles for impairment whenever
                    events or changes in circumstances indicate that the
                   carrying amount of an asset may not be recoverable,
                  and, if deemed impaired, measurement and recording
                   of an impairment loss is based on the fair value of
the asset.                      

Capital Assets          Capital assets are recorded at cost.  Amortization      
                    is provided annually at rates calculated to amortize
               the assets over their estimated useful lives as
follows:                        

Machinery, plant and            
                 computer equipment     -  30% declining balance

                Furniture and fixtures  -  20% declining balance
                Prototype and jigs      -  20% declining balance

Earning or Loss         The Company has adopted SFAS No. 128,                   
Per Share              "Earnings Per Share" which requires that the           
                 consolidated financial statements reflect "basic"
              and "diluted" earning (loss) per share.  Basic
                    earning (loss) per share is computed by dividing net
               income (loss) by the weighted average number of
                  common shares outstanding for the period.  Diluted
                 earnings (loss) per share is computed by dividing
                   net income (loss) by the weighted average number of
           common shares outstanding plus common stock
                  equivalents (if dilutive) related to stock options
and warrants for each period.   

Stock Based             SFAS No. 123, "Accounting for Stock-Based               
Compensation           Compensation" encourages, but does not require,        
                 companies to record compensation costs for stock-
                based employee compensation plans at fair value.
                   The Company chose to continue to account for stock-
                   based compensation using the intrinsic value method
                 prescribed in Accounting Principles Board Opinion
                   No. 25. "Accounting for Stock Issued to Employees",
          and related interpretations.  Accordingly,
                  compensation cost for stock options is measured as
                 the excess, if any, of the quoted market price of
                    the Company's stock at the measurement date over the
                 amount an employee must pay to acquire the stock.
                  See Note 10 (d) for a summary of the pro forma net
               loss per share determined as if the Company had
applied SFAS No. 123.           

Cash and Equivalents    Cash and cash equivalents include all highly liquid     
                    investments with original maturities of three months
or less.                        

Revenue Recognition     Product sales are recognized as revenue upon            
                  shipment of the product.  Advance sales revenue is
      deferred until shipment of the product

Foreign Currency        Balances of the Company denominated in foreign          
Translation            currencies and the accounts of its foreign             
             subsidiary are translated into the functional
currency as follow:             

                 (i)   monetary assets and liabilities at year end
rates;              

                    (ii)  all other assets and liabilities at historical
rates;              

             (iii) revenue and expense transactions at the
                          average rate of exchange prevailing during the
year; and           

                 (iv)  changes in cash flow at the average rate of
                exchange prevailing during the year.

         Exchange gains or losses arising on these
                 translations are reflected in income in the year.

Income Taxes            The Company accounts for income taxes under the         
                  asset and liability method as required by SFAS No.
                  109, Accounting for Income Taxes.  Under the asset
               and liability method, deferred income taxes are
                recognized for the tax consequences of temporary
                    differences by applying enacted tax rates applicable
                   to future year to differences between the financial
                statements carrying amounts and the tax bases of
                  existing assets and liabilities.  When tax credits
                   are available, they are recognized as reductions of
current year's tax expense.     

Concentrations of       The Company's receivables are unsecured and are         
Credit Risk and        generally due in 30 days.  Currently the Company's     
Business               customers are primarily local, national and            
Concentration          international users of wide format document            
                 management systems.  The company's receivables do
                  not represent significant concentrations of credit
                   risk as at March 31 1999 due to the wide variety of
                    customers, markets and geographic areas to which the
Company's products are sold.    

Fair Value of           The carrying amounts of financial instruments of the    
Financial Instruments  Company, including cash and cash equivalents,          
                accounts receivable, bank indebtedness, accounts
                    payable, and convertible debentures approximate fair
                value because of their short maturity.  The fair
                   value of advances to and loans from related parties
                  cannot be readily determined because of the nature
of their terms.                 

                                              The WideCom Group Inc.
                          Notes to Consolidated Financial Statements
                                          (in United States dollars)

March 31, 1998, and 1999                                                        
--------------------------------------------------------------------------      

1.    Accounts Receivable                                                       

Accounts receivable consist of:                                     

                                                                [Download Table]

                                                1998          1999  
                                              ----------------------

                                                                    
Trade Receivable                              $612,946      $637,097
Less: Allowance for doubtful accounts           33,886        84,196
                                              ----------------------
                                              $579,060      $552,901
                                              ======================

--------------------------------------------------------------------------      

2.    Inventory                                                                 

Inventory consists of:                                              

                                                                [Download Table]

                                             1998            1999   
                                          --------------------------

                                                                    
Raw Materials                             $  967,723      $  689,155
Work-in-progress                              56,644          13,587
Finished goods                               277,155         472,370
                                          --------------------------
                                          $1,301,522      $1,175,112
                                          ==========================

--------------------------------------------------------------------------      

3.    Advances to/loans from related parties                                    

(a)   Advances to related parties are non-interest bearing and are  
 expected to be repaid in the next fiscal year as follows:

                                                                [Download Table]

                                             1998          1999  
                                           ----------------------

                                                                 
3294340 Canada Inc. (i)                    $149,696      $196,034
Shareholders                                 31,234        29,384
                                           ----------------------
                                           $180,930      $225,418
                                           ======================

i)   3294340 Canada Inc.                                      

Advances were made to a company as referred to in Note 6 to   
    facilitate research and development activities.  There is no fixed
term of repayment and the balance is due on demand.           

(b)   During the year, the following non-interest bearing advances  
       were made to the company as short-term loans in order to assist
in certain working capital requirements:                

                                                                [Download Table]
                                                            
Director and officer                                 $29,655
Shareholder owning more than 5% of                          
 the outstanding shares                               35,284
                                                     -------
                                                     $64,939
                                                     =======

(c)   Transactions with companies controlled by, and fees paid to,  
     executive officers,  the principal shareholders and directors
during the year were as follows:                        

                                                                [Download Table]

                                              1998            1999   
                                            ------------------------ 

                                                                     
Sales                                       $ 127,043      $   8,790 
Management fees and salaries                 (398,804)      (333,743)

  The management fees are paid on a month to month basis to executives
   who comprise senior management of the Company (See also Note 13((c)).

--------------------------------------------------------------------------      

4.    Capital Assets                                                            

Capital assets consist of:                                          

                                                                [Download Table]

                                         1998                        1999          
                                -----------------------    ------------------------
                                           Accumulated                 Accumulated 
                                Cost       Amortization     Cost       Amortization
                                ---------------------------------------------------

                                                                                   
Machinery, plant and                                                               
 computer equipment          $1,941,521    $  842,076    $1,913,903    $1,088,694  
Furniture and fixtures          114,832        44,061       108,065        54,411  
Prototype and jigs              307,500       101,569       289,380       131,563  
Land                             59,785             -        56,262             -  
Building under construction     313,380             -       361,021             -  
                             ----------------------------------------------------  
                             $2,737,018    $  987,706    $2,728,631    $1,274,668  
                             ----------------------------------------------------  
Net book value                             $1,749,312                  $1,453,963  
                             ----------------------------------------------------  

--------------------------------------------------------------------------      

5.    Purchased research and development technology                             

During the year, the company acquired the rights to a photo-printer 
technology, which is in the process of being developed by its       
President and Chief Executive Officer.  A patent application is     
currently pending.                                                  

The development of this technology will continue through a wholly-  
 owned subsidiary; Diprin Inc. ("Diprin") that was previously owned by
the President and Chief Executive Officer.                          

In consideration for the ownership of this technology, the company  
issued 125,000* common shares to its President and Chief Executive  
Officer [See note 10(b)(vii)].                                      

The design of the portable photo-printer is in the latest stages of 
 completion and management estimates that prototyping will commence in
 the fiscal year ending March 31, 2000.  The cost of the technology is
being amortized on a straight-line basis over 3 years from September
30,1998.  As at March 31, 1999, the unamortized balance amounted to 
$78,777.                                                            

--------------------------------------------------------------------------      

6.    Investment in Affiliate                                                   

                                                                [Download Table]

                                               1998          1999   
                                            ------------------------

                                                                    
3294340 Canada Inc                          $1,058,586      $545,113
                                            ------------------------

In October 1996, the Company entered into a joint venture agreement 
 which resulted in the purchase of a 45% stake in 3294340 Canada Inc.,
a Quebec based company, for approximately $1,875,000.  The investee 
carries on research and development activities in order to develop  
improvements, modifications, additions or alteration to the         
  intellectual property and to develop new products.  In connection with
the transaction, the Company also entered into a Stock Exchange     
Agreement with Societe Innovatech du Grand Montreal, an economic    
development agency of the government of the Province of Quebec,     
pursuant to which Societe Innovatech du Grand Montreal would be     
permitted, under certain circumstances, to exchange its 45% interest
for up to 63,250* common shares of the Company.  The Company has a  
commitment to pay a royalty fee based on net revenue ((See also note
13(b)).  The assets, liabilities, revenue and expenses of 3294340   
Canada Inc. for the years ended 1998, 1999, are as follows:         

                                                                [Download Table]

                                            1998             1999    
                                        ---------------------------- 

                                                                     
Current assets                          $ 2,012,857      $ 1,014,554 
Capital and other assets                    650,534          549,339 
                                        ---------------------------- 
                                          2,663,391        1,563,893 
Current Liabilities                         310,977          370,954 
                                        ---------------------------- 
Net assets                              $ 2,352,414      $ 1,192,939 
                                        ---------------------------- 
Revenue                                                              
  Miscellaneous income                  $   139,171      $    66,287 
  Research and development                  545,613          669,857 
                                        ---------------------------- 
                                            684,784          736,144 
Expenses                                  2,001,420        1,741,963 
                                        ---------------------------- 
Net loss for the year                   $(1,316,636)     $(1,005,819)
                                        ---------------------------- 

<FN>                                                                     
*  Adjusted for reverse split of Company stock (1:4) on January      
   29,1999.                                                          
</FN>                                                                     

--------------------------------------------------------------------------      

7.    Bank Indebtedness                                                         

 During 1998 the Company renewed an operating line of credit available
for approximately $250,000 which bears interest at prime plus 0.75%,
 is due on demand, and is secured by a general security agreement over
all company assets except real property.  At March 31, 1999,        
approximately $249,000 (1998-$112,000) was utilized.                

 The Company's 1999 and 1998 bank indebtedness is the result of a bank
  overdraft in the Company's subsidiary as well as a revolving operating
  loan in the Company.  The indebtedness of the subsidiary is secured by
a pledge of fixed deposits with the local bank.                     

--------------------------------------------------------------------------      

8.    Accounts Payable and accrued liabilities                                  

Accounts payable and accrued liabilities consist of:                

                                                                [Download Table]

                                              1998           1999   
                                           -------------------------

                                                                    
Trade accounts payable                     $  300,268     $  546,586
Wages and employee deduction payable           73,338        191,382
Accrued liabilities                           423,418        371,921
Accrued litigation costs (Note 10(b))         121,871        189,565
Accrued warrant exercise costs                 94,237              -
                                           -------------------------
                                           $1,013,132     $1,299,454
                                           -------------------------

--------------------------------------------------------------------------      

9.    Convertible Debentures                                                    

On May 19,1997, the Company completed a private offering of $250,000
of convertible debentures maturing on May 19, 1998.  The convertible
debentures bear interest of 8% per annum. In addition, 12,500*      
warrants were also issued in conjunction with these convertible     
 debentures.  The holder of the debentures has the right to convert at
a conversion price equal to the lower of $5 or 80% of the average   
closing bid price of the Company's shares over the past 20 trading  
days.  On February 11, 1998, $50,000 principal plus accrued interest
was converted into 14,742* common shares.  The warrants are         
exercisable over 3 years at an exercise price of $16 per share.  The
value attributable to the warrants is not material.  Included in    
accounts payable is accrued interest on the debentures of $25,658.  

On April 24, 1998, the debenture holder converted another $50,000   
principal plus interest into 17,213* of common shares.              

  The company is currently in default for the repayment of its remaining
$150,000 convertible debentures that came due on May 18, 1998.      

The company also conducted a private placement of ten specific      
investment units, each comprising 10,000 common shares (see Note    
10(b)(x)) and a three-year 12% convertible subordinated note in the 
amount of $20,000.  Interest payments are payable quarterly and     
  conversion is available at an exercise price of $1.00 per share.  One-
 half of the principal amount of the note is exercisable during the 30
day period commencing 180 days from the initial closing on February 
19, 1999.  The remaining principal amount is convertible at anytime 
following 360 days after the initial closing.                       

--------------------------------------------------------------------------      

10.   Share Capital                                                             

(a)   Authorized                                                    

     5,000,000 common shares pursuant to shareholder approval of a
 1:4 reverse split of the common shares     of the Company
effective January 29, 1999.                             

  Of the 2,068,400* shares outstanding as of March 31, 1999,
       128,463* shares have not been registered by the Company's stock
transfer agent.                                         

(b)   Changes to Issued Share Capital                               

        (i)    During 1998, 180,981* warrants were exercised in exchange
              for 180,981* common shares.  The proceeds of this issue,
               net of related expenses of $120,470, was $2,049,709. This
            amount includes warrants exercised under the Company's
warrant call.                             

*  Adjusted for reverse split of Company's common stock (1:4) on January 29,    
1999.                                                                     

   (ii)   During 1998, 69,625* shares were issued for the full
          settlement and legal costs of a class action lawsuit
             filed in the State of New York and a partial settlement
           of another class action lawsuit filed in the State of
        California.  Both lawsuits were in connection with
            potential losses that would be suffered on the warrant
           call.  The Company is required to issue an additional
               18,750* shares in connection with the State of California
  suit and accordingly the Company has accrued
         approximately $122,000 for the cost of these shares
              representing the fair value of the shares on February 2,
         1998.  The Company has also agreed to issue 96,927*
           replacement warrants for each warrant held by warrant
           holders on February 10, 1997 and sold by such holders
prior to March 5, 1997.                   

       (iii)  During 1998, $50,000 of convertible debentures (see Note
        9) were converted into 14,742* common shares.  The
              debentures were converted based on a conversion price of
            $0.8479 that represents the average of the closing bid
          share price of 20 days prior to the conversion.  The
             Company also incurred $10,000 of issuance cost relating
to the conversion of the debentures.      

   (iv)   In April, 1998, an additional $50,000 of convertible
         debentures (see Note 9) were converted into 17,213*
             common shares. The debentures were converted based on a
             conversion price of $0.7262 that represents the average
        of the closing bid share price for the twenty days
             preceding the conversion.  The Company incurred $15,000
             in further issuance costs related to this conversion of
the debenture.                            

        (v)    In fall 1998, the Company issued an aggregate of 294,117*
            common shares (73,529, 110,294* and 110,294*) to three
       principals of the Company in full satisfaction of
            corporate indebtedness to those parties as approved by
the Board of Directors.                   

     (vi)   Effective January 29, 1999, the Company's shareholders
      approved a 1: 4 reverse stock split resulting in
           1,788,649* common shares outstanding as of that date.

       (vii)  During the fourth quarter of fiscal, 1999, the Company's
          shareholders also approved the acquisition of Diprin
             Inc., a corporate entity wholly owned by a principal of
          the Company in exchange for the issuance of 125,000*
common shares.  (see Note 5)              

        (viii) During the fourth quarter of fiscal 1999, the Company and
        its legal counsel approved an amendment to a legal
               resolution (see note (ii) above). The amendment converted
               the warrant entitlements under the settlement into common
              shares that were subject to the 1:4 reverse stock split.
        An aggregate of 109,466* common shares were issued
             pursuant to two separate issuances effected pursuant to
              Company instructions dated February 17, 1999 and May 21,
1999 (54,751* and 54,715* respectively).  

        (ix)   During the fourth quarter of fiscal 1999, the Company and
        its legal counsel approved a legal resolution of a
              lawsuit in the state of Rhode Island between the Company
             and three individual litigants. The resolution approved
              by the Board of Directors of the Corporation comprised a
        transfer of 5,000* of the Company's common shares.

      (x)    During fiscal 1999, the Company engaged the services of
        Robb Peck McGooey Clearing Corporation, Cantella &
          Associates and Quantum Resources Inc., three related
       financial services companies to conduct a private
            offering to raise funds for investment in the Company.
             The units in the offering granted 10,000 shares to each
               purchaser. In total, ten units were sold with 1/20.5 unit
           closing after the Company's year end.  95,000* shares
             were issued pursuant to the placement between February,
         1999 and year-end on March 31, 1999.  The remaining
              5,000* shares were issued in the first quarter of fiscal
             2000.  The three companies are also entitled to a grant
             of 50,000* warrants to purchase 50,000 common shares at
an exercise price of $1.20.               

    (xi)   On March 15, 1999, the Company approved a transfer of
        8,000* shares by a principal of the corporation to
        satisfy an outstanding account with a professional
           service provider. The Company has yet to finalize the
             terms of repayment, if any, with respect to this equity
transfer.                                 

 (xii)  In April, 1999, the Company issued an aggregate of
        61,618* common shares (40,810* and 20,808*) to two
             consulting companies independently run by an individual
      principal of the Company in full satisfaction of
            corporate indebtedness to those parties as approved by
the Board of Directors.                   

       (xiii) In May, 1999, the Company approved a surrender of 4,010*
    shares from a principal of the Company in full
             satisfaction of an indebtedness to the company pursuant
              to an indemnification agreement as approved by the Board
of Directors.                             

       (xiv)  On May 26, 1999, the Company and its legal counsel, with
       the approval of the Board of Directors, issued an
          additional aggregate of 19,748* common shares as the
            final stage of a settlement agreement with the Company
((see note 10(b)(ii) above)).             

(c)   Warrants                                                      

 As at March 31, 1999, the Company had 556,911* issued and
     outstanding warrants.  The warrants are exercisable at prices
       ranging from $1.20 to $34.00 with expiry dates between 1999 and
2009.                                                   

(d)   Employee Stock Option Plan                                    

     The Company has elected to follow Accounting Principles Board
(APB) Opinion No. 25, "Accounting for Stock Issued to   
     Employees", and related interpretations in accounting for its
      employee stock options.  Under APB 25, compensation expense is
  not recognized if the exercise price equals or exceeds the
     market price on the date of grant.  The exercise price of the
       Company's employees stock option equals the market price of the
        underlying stock on the date of grant, therefore no compensation
expense is recognized.                                  

       In July 1996, the board of directors approved an employee stock
      option plan covering options to purchase 75,000* common shares
that was increased in January 1997 to 125,000*.         

        As of March 31, 1998, 115,625* employee stock options granted to
        management and employees were outstanding with an exercise price
       of $8.50. Only 16,683 of these options remain unvested but will
     vest before the fourth quarter of fiscal 2000.  These options
expire 10 years after the grant date.                   

       In fiscal 1999, 8,625* employee stock options were granted with
exercise prices ranging from $3.28 to $4.00.            

        Pro forma information regarding net income and earning per share
      is required by SFAS No. 123, and has been determined as if the
      company had accounted for its employee stock options under the
     fair value method of that statement.  The fair value of these
        options was estimated at the date of grant using a Black-Scholes
option pricing model with the following weighted-average
   assumptions: risk-free interest rate of approximately 5.5%;
  dividend yield of 0.0%; volatility factors of the expected
        market price of the Company's common stock of approximately 122%
      (1998 - 200%) and weighted-average expected life of the option
of 8.5 years.                                           

The Company's pro forma information follows:            

                                                                [Download Table]

                        Year Ended      Year Ended      Year Ended 
                         March 31,       March 31,       March 31, 
                           1997            1998            1999    
                        ------------------------------------------ 

                                                                   
Net loss                                                           
As reported            $(4,487,824)    $(3,335,865)    $(2,244,351)
Pro forma               (5,177,824)     (3,840,790)     (2,350,607)

Net loss per share                                                 
As reported                  (3.96)          (2.36)          (1.28)
Pro forma                    (4.56)          (2.72)          (1.34)

(e)   The activity of the Company's stock option plan is as follows:

                                                        [Enlarge/Download Table]

                              Options Outstanding             Options Exercisable    
                         ----------------------------    ----------------------------
                           Weighted                        Weighted                  
                         Average Price      Options      Average Price      Options  
                           Per Share      Outstanding      Per Share      Exercisable
                         ------------------------------------------------------------

                                                                                     
Balance, March 31,1997      $24.64           75,000          24.64           75,000  
Granted                       8.50          115,625                                  
Cancelled                    34.00          (25,000)                                 
Cancelled                    20.00          (50,000)                                 
                                            -------                                  
Balance, March 31, 1998       8.50          115,625           8.50           98,942  
Granted                       4.00            7,500                                  
Granted                       3.28            1,125                                  
Cancelled                     8.50           (9,667)                                 
                                            -------                                  

Balance, March 31, 1999       8.15          114,583           8.15          104,958  

(f)   At March 31, 1999, there were 10,417 options available for    
future grants.  As at March 31, 1999, the options       
have a weighted average contractual life of 8.5 years.  

        The weighted average number of common shares used in calculating
       earnings per common share (after retroactive application of the
back split in 1999) is as follows:                      

                                                        [Enlarge/Download Table]

                                                      1997         1998         1999  
                                                   -----------------------------------
                                                                                      
            Shares outstanding at year-end         1,212,105    1,477,320    2,068,400
                                                   -----------------------------------
            Weighted average shares outstanding    1,133,396    1,416,047    1,749,386
                                                   -----------------------------------

<FN>                                                                                  
*  Adjusted for reverse split of Company's common stock (1:4) on January 29,          
   1999.                                                                              
</FN>                                                                                 

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11.   Accumulated other comprehensive loss                                      

The Company has adopted SFAS No.130 "Reporting comprehensive income"
which requires new standards for reporting and display of           
 comprehensive income and its components in the consolidated financial
statements.  However it does not affect net income or total         
shareholders' equity.  The components of comprehensive loss are as  
follows:                                                            

                                                        [Enlarge/Download Table]

                                                1997              1998              1999    
                                            ----------------------------------------------- 

                                                                                            
Net loss                                    $(4,487,824)      $(3,335,865)      $(2,244,351)
Other comprehensive income loss                                                             
  Foreign currency translation adjustments     (195,569)          (54,325)         (280,396)
                                            ----------------------------------------------- 
Comprehensive loss                          $(4,683,393)      $(3,390,190)      $(2,524,747)
                                            ----------------------------------------------- 

  The components of accumulated other comprehensive loss are as follows:

                                                                [Download Table]
                                                                     
Accumulated other comprehensive loss, March 31, 1996       $  (7,719)
Foreign currency translation adjustment for the year                 
 ended March 31, 1997                                       (195,569)
                                                           --------- 
Accumulated other comprehensive loss, March 31, 1997        (203,288)
Foreign currency translation adjustment for the year                 
 ended March 31, 1998                                        (54,325)
                                                           --------- 
Accumulated other comprehensive loss, March 31, 1998        (257,613)
Foreign currency translation adjustment for the year                 
 ended March 31, 1999                                       (280,396)
                                                           --------- 
Accumulated other comprehensive loss, March 31, 1999       $(538,009)
                                                           ========= 

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12.   Income Taxes                                                              

a)   The components of the provision for income taxes on earning    
before income taxes are as follows:                       

                                                                [Download Table]

                                   1997         1998       1999 
                                 -------------------------------

                                                                
Deferred recovery                $(63,106)     $    -     $    -
                                 ===============================

b)   The reconciliation of income taxes calculated at the statutory 
rate of 44.6% to the total tax provision is as follows:   

                                                        [Enlarge/Download Table]

                                                 1997              1998              1999    
                                             ----------------------------------------------- 

                                                                                             
Income taxes recovery                        $(2,030,000)      $(1,488,000)      $(1,001,000)
Items not subject to income tax                  210,000           309,000           406,000 
Permanent difference resulting from the                                                      
 Ontario research and development incentive                                                  
 deduction                                       (21,000)                -                 - 
Adjustment to valuation adjustment             1,777,800         1,179,000           595,000 
                                             ----------------------------------------------- 
                                             $  (63,200)       $         -       $         - 
                                             =============================================== 

       Income tax provision and recovery is related solely to domestic
     operations.  Foreign operations are not subject to taxes (see
Note 14).                                               

(c)   Deferred Taxes                                                

  Deferred tax assets have been recorded at current rates as
follows:                                                

                                                        [Enlarge/Download Table]

                                                    1997             1998             1999    
                                                --------------------------------------------- 

                                                                                              
Assets:                                                                                       
  Financing costs                               $    44,000      $    28,000      $    44,000 
  Balance of pool of Scientific Research &                                                    
   Development available to reduce taxable                                                    
   income for future years                          615,000          582,000          582,000 
  Tax losses available to reduce taxable                                                      
   income of future years                         1,364,000        2,440,000        2,989,000 
  Share issue costs                                 686,000          743,000          743,000 
  Excess of amortization on capital assets for                                                
   accounting purposes over amortization                                                      
   recorded for tax purposes                        197,000          259,000          289,000 
                                                --------------------------------------------- 
                                                  2,906,000        4,052,000        4,647,000 
                                                --------------------------------------------- 
Less Deferred tax asset valuation allowance      (2,906,000)      (4,052,000)      (4,647,000)
                                                --------------------------------------------- 
                                                $         -      $         -      $         - 
                                                ============================================= 

  The Company has net operating loss carryforwards to reduce
       federal taxable income of approximately $7,565,000 which expire
from 2004 to 2006.  The Company has net operating loss  
    carryforwards available to reduce Ontario taxable  income of
   approximately $8,912,000 which expire during the years 2000
through 2006.                                           

        The Company has share issue costs amounting to $2,800,000, which
     gives rise to a tax benefit of $743,000 ($743,000 - 1998).  A
       portion of these costs are included in the net operating losses
       carryforwards disclosed above.  When realized, the benefit will
be recorded as a capital transaction.                   

13.   Commitments                                                               

  (a)   The Company leases premises, office equipment and motor vehicles
        under operating leases expiring in 2003.  The approximate annual
 rental commitments during the lease terms are as follows:

Year ended March 31 2000                  106,000       
Year ended March 31, 2001                  51,000       
Year ended March 31, 2002                  16,000       
Year ended March 31 2003                    1,000       

        Approximate rental expense incurred under operating leases is as
follows:                                                

Year ended March 31 1997                  176,000       
Year ended March 31, 1998                 169,000       
Year ended March 31, 1999                 177,243       

 (b)   The Company is committed to its affiliate, 3294340 Canada Inc.,
       to pay a 0.5% royalty fee on net revenue, licensing revenue and
    net sales to sub-licensees on scanner and plotter technology
        created by the affiliate on behalf of the Company (See also Note
6).                                                     

(c)   The company has entered into employment contracts with two    
   members of management for a total of up to $190,000 in base
     salary per annum plus up to 50% bonus of base salary provided
     certain performance objectives are met.  Amounts paid in 1999
were approximately $194,000 ($239,000 in 1998).         

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14.   Segmented Information                                                     

  The Company has adopted SFAS No. 131 " Disclosures about segments of a
enterprise" which establishes standards for reporting operating     
segments in annual consolidated financial statements.               

Description of type of product                                      

The Company operates through one segment, which is, wide format     
document management systems, comprising two major products - wide   
format scanners and plotters.                                       

Measurement of Segment profit and loss                              

As the products (noted above) are regarded as one segment the       
statements of operations and balance sheets are deemed by management
to be wholly attributable to that segment.                          

(a)   The Company operated in Canada and India in one industry      
     segment.  The Company's operations and identifiable assets by
geographic region are as follows:                       

                                                        [Enlarge/Download Table]

                                Canada           India         Intercompany          Total   
                             --------------------------------------------------------------- 

                                                                                             
For the year ended March 31,1997                                                             

Revenue                      $ 1,329,446      $ 1,357,171      $  (865,904)      $ 1,820,713 
Net loss                      (4,364,854)        (628,877)         505,907        (4,487,824)
Identifiable assets            6,719,782        2,872,586       (2,667,181)        6,925,187 

For the year ended March 31, 1998                                                            

Revenue                      $ 2,913,259      $ 1,556,141      $(1,415,596)      $ 3,053,804 
Net loss                      (3,321,531)        (244,027)         229,693        (3,335,865)
Identifiable assets            6,677,495        2,442,435       (3,468,740)        5,651,190 

For the year ended March 31, 1999                                                            

Revenue                      $ 2,726,807      $ 1,694,131      $(1,345,329)      $ 3,075,609 
Net loss                      (2,357,707)        (111,715)         225,071        (2,244,351)
Identifiable assets            4,547,514        2,066,306       (2,335,604)        4,278,216 

  (b)   The breakdown of product sales by geographic area is as follows:

                                                                [Download Table]

                       1997            1998            1999   
                    ------------------------------------------

                                                              
Canada              $  122,676      $  322,968      $  211,735
United States          467,766       1,246,270       1,338,704
Middle East            346,595         312,042         200,711
Asia                   266,345         322,685         583,077
Europe                 475,551         686,478         241,708
                    ------------------------------------------
                    $1,678,933      $2,890,443      $2,575,935
                    ==========================================

(c)   In the years ended March 31, 1999, 1998 and 1997 no end user  
      accounted for more than 5% of the Company's product sales.  In
     1999, approximately 20.3% of the company's product sales were
     made through five distributors, with the largest representing
approximately 8 %. For the year ended March 31, 1998,   
  approximately 43% of the Company's product sales were made
through five distributors, with the largest representing
      approximately 23.7%.  For the year ended March 31, 1997, sales
   to one major distributor amounted to approximately 27.5% of
total product sales.                                    

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15.   Contingent Liabilities                                                    

(a)   The Company has been served with an action claiming breach of 
        contract regarding the Company's rights under two specific joint
        venture and development agreements to use and distribute various
        iterations of software components allegedly the sole property of
      the claimant. The action claims damages for breach of contract
    along with copyright and trademark infringement as a result.
       The claim, as filed, seeks a total of $15.85 Million in damages
 and is in progress in the Province of Ontario. Resolution
     options remain open and the action is presently scheduled for
mediation in the fall of 1999.                          

Loss, if any, on the above claim will be recorded when  
  settlement is probable and the amount of the settlement is
estimable.                                              

(b)   During the year, the company settled claims which resulted in 
additional expenses of $158,741 ($309,375 in 1998).     

(c)   In December, 1996, two individuals filed a lawsuit seeking    
60,000 shares and 40,000 warrants.  This action has been
      formally dismissed.  An additional three (3) shareholders have
   also commenced related litigation, alleging purchase of our
     securities from the previously noted two individuals, who are
   named as co-defendants.  We have filed and received default
    judgments on our cross-claims against the two individual co-
       defendants.  The total number of shares of common stock claimed
under these suits is less than 15,000.                  

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16.   Supplemental Disclosure of Cash Flow Information                          

Cash Paid during the year:                                          

                                                                [Download Table]


                                               1998          1999   
                                              ----------------------

                                                                    
Interest                                      $ 41,488      $ 42,711
                                              ----------------------
Non monetary transactions during the year:                          

Shares issued for investment in subsidiary    $       -     $ 93,750
Shares issued to settle lawsuits               355,158        83,457
Shares issued for conversion of debentures      50,000        50,000
                                              ----------------------
                                              $405,158      $227,207
                                              ======================

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17.   Subsequent Event                                                          

 The company is in the process of closing a private placement approved
by the Company's board of directors wherein 325,000 common shares of
the Company were offered at $2.00 per share.  The offering was fully
subscribed with duly executed subscription documentation provided by
accredited investors.                                               

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18.   Uncertainty Due to the Year 2000 Issue                                    

The Year 2000 Issue arises because many computerized systems use two
digits rather than four to identify a year.  Date-sensitive systems 
may recognize the year 2000 as 1900 or some other date, resulting in
errors when information using year 2000 dates is processed.  In     
  addition, similar problems may arise in some systems which use certain
dates in 1999 to represent something other than a date.  The effects
  of the Year 2000 Issue may be experienced before, on, or after January
  1, 2000, and, if not addressed, the impact on operations and financial
reporting may range from minor errors to significant systems failure
which could affect a company's ability to conduct normal business   
 operations.  It is not possible to be certain that all aspects of the
 Year 2000 Issue affecting the company, including those related to the
  efforts of customers, suppliers, or other third parties, will be fully
resolved.                                                           

 See accompanying summary of significant accounting policies and notes
to these Consolidated Financial Statements                          

1,289,441 SHARES    

THE WIDECOM GROUP, INC.   

COMMON STOCK    

PROSPECTUS    

                , 1999
--------------      

PART II   

INFORMATION NOT REQUIRED IN THE PROSPECTUS    

Item 24.  Indemnification of Directors and Officers.                            

Article 6 of our By-Laws limits the personal liability of directors 
and officers to us or our shareholders for monetary damages arising from a      
breach of their fiduciary duty in certain circumstances.  Article 6 of our      
By-Laws also provides that we may indemnify our officers and directors to       
the fullest extent permitted by the Ontario Business Corporations Act from      
any liability and all costs, charges and expenses that such officer or          
director sustains in respect to any action, suit or proceeding that is          
proposed or commenced against him or her for or in respect the execution of     
the duties of his or her office.  Part IX of the Ontario Business               
Corporations Act authorizes a corporation to indemnify directors and            
officers unless such party has been adjudicated in any proceeding not to        
have acted in good faith in the reasonable belief that his action was in        
the best interests of the corporation.  The effect of these provisions is       
to permit such indemnification by us for liabilities arising under the          
Securities Act.                                                                 

Item 25.  Other Expenses of Issuance and Distribution                           

We will bear all expenses in connection with the issuance and       
distribution of the shares, including those set forth below.  None of these     
expenses will be borne by the selling shareholders.                             

                                                                [Download Table]

Items                                                            Amounts  
------------------------------------------------------------------------  
                                                                          
Securities and Exchange Commission                                        
Registration Fee                                               $ 1,751.85 
Printing and Engraving Expenses                                $ 5,000.00*
Accounting Fees and Expenses                                   $ 1,000.00*
Legal Fees and Expenses                                        $35,000.00*
Blue Sky Fees and Expenses                                     $15,000.00*
Transfer Agent and Registrar Fees                              $ 2,000.00*
Miscellaneous Fees and Expenses                                $     0.00*

Total                                                          $59,751.85*
                                                               ===========
<FN>                                                                      
<F*> Estimated                                                            
</FN>                                                                     

Item 26. Recent Sales of Unregistered Securities                                

During fiscal 1999, our shareholders approved the engagement of Robb
Peck McCooey Clearing Corporation, Cantella & Associates and Quantum            
Resources, Inc., three related financial services companies, to conduct a       
private offering of our securities to raise funds for investment in             
Widecom.  The total amount of the offering price was $1,500,000.  The           
securities offered consisted of units, each unit consisting of 10,000           
shares of our common stock and a 12% three-year convertible note in the         
principal amount of $20,000.  9.5 units were sold during fiscal 1999 and        
the closing for an additional 0.5 units occurred after the fiscal year end.     
In total, 95,000 shares of common stock were issued through the offering        
during fiscal 1999 and an additional 5,000 shares of common stock were          
issued in the first quarter of fiscal 2000.  All placement agents were          
granted warrants to purchase a total of 50,000 shares of our common stock       
at an exercise price of $1.20.  The offering was conducted under Rule 506       
of Regulation D, promulgated under the Securities Act.                          

 Subsequently, we conducted an additional private placement of 325,000
shares of our common stock.  Under the terms of the offering, each share        
was offered at $2.00 per share and the total offering price was $650,000.       
This offering was fully subscribed at the closing, which took place of July     
6, 1999.  The selling agent in this offering received warrants for the          
purchase of 100,000 shares of our common stock at an exercise price of          
$2.00 per share.  The offering was conducted under Rule 506 of Regulation       
D, promulgated under the Securities Act.                                        

In the 1999 fiscal year we issued 13,500 shares of our common stock 
to Goldstein & Digioa, LLP, our counsel.  These shares were issued as           
compensation for services rendered.                                             

In May, 1997, we completed a private offering under Regulation D    
promulgated under the Securities Act, wherein we raised $250,000 in gross       
proceeds in connection with the sale to a single investor of five units of      
our securities.  Each unit was comprised of the following: (1) one $50,000      
principal amount convertible debenture and (2) a common stock purchase          
warrant to purchase 2,500 shares.  Under the debentures, the investor has       
the right, at any time prior to the payment in full of the debentures, to       
convert all or part of the unpaid balance of the debentures into shares of      
our common stock.  The conversion price is the lower of $20 or 80% of the       
average closing bid price of Widecom's common stock as quoted on Nasdaq         
system over the twenty trading days immediately preceding the date of the       
our receipt of notice requesting conversion.  In February, 1998, $50,000 of     
the outstanding debentures were converted into 14,742 shares of common          
stock. In April, 1998, an additional $50,000 of the debentures were             
converted into 17,213 shares of common stock.  The remaining $150,000           
principal amount of debentures are convertible into an aggregate of 89,818      
shares of common stock based on a conversion price of $.79 for the first        
$50,000; $.63 for the second $50,000 and $.29 for the final $50,000.  The       
warrants noted above are exercisable over five years and have an exercise       
price of $16.00 per share, subject to adjustment in certain circumstances.      
We previously registered the shares of common stock underlying the              
debentures and warrants in a registration statement which was declared          
effective by the SEC in March, 1998.                                            

On September 9, 1998, Raja S. Tuli, President and Chief Executive   
Officer, Suneet S. Tuli, our Executive Vice President and Secretary, and        
Lakhbir S.Tuli, an independent consultant for us and the father of Raja and     
Suneet Tuli, purchased an aggregate of 294,117 shares of our common stock       
at $.68 cents per share in a private transaction in full satisfaction of        
indebtedness owed to them and to provide us with funds for working capital.     

Item 27.  Exhibits.                                                             

The following exhibits are filed herewith.                                      

*     Indicates that the exhibit is submitted as part of this filing.           

Exhibit                                                                         
No.       Description                                                           
---       -----------                                                           
3.1       Articles of Incorporation (Exhibit 3.1 to Form F-1 Registration       
Number 33-78004,filed May 6, 1994)                          

3.2       Bylaws (Exhibit 3.1 to Form F-1 Registration Number 33-               
78004,filed May 6, 1994)                                    

4.1       Form of Common Stock Certificate (Exhibit 4.1 to Form F-1             
Registration Number 33-78004, filed November 21, 1994)      

4.2       Form of Warrant Issued in Widecom's Initial Public Offering           
(Exhibit to Form F-1 Registration Number 33-78004, filed    
November 21, 1994)                                          

4.3       Form of Warrant Issued to Selling Shareholders (Exhibit 4.3 to        
        Form SB-2, Registration Number 333-89109, filed on October 15, 1999)

4.4       Form of Convertible Notes issued in 1999 private placement of         
   Units (Exhibit 4.4 to Form SB-2, Registration Number 333-89109,
filed on October 15, 1999)                                  

5.        Opinion of Goldstein & DiGioia, LLP., re: legality of shares (to      
be filed upon further amendment)                            

10.1      Financial Consulting Agreement, dated February 1, 1998, by and        
     between The Widecom Group Inc. and Quantum Resources of New York,
   Inc. (Exhibit 10.1 to Form SB-2, Registration Number 333-89109,
filed on October 15, 1999)                                  

10.2      Financial Consulting Agreement, dated August 1998, by and between     
The Widecom Group Inc. and Robb Peck McCooey Clearing       
 Corporation.  (Exhibit 10.2 to Form SB-2, Registration Number
333-89109, filed on October 15, 1999)                       

10.3      Agreement, dated September 9,1998, by and between The Widecom         
Group, Inc. and Cantella & Co. (Exhibit 10.3 to Form SB-2,  
Registration Number 333-89109, filed on October 15, 1999)   

10.4      Agreement dated August 10, 1999 by and between The Widecom Group,     
   Inc., Robb Peck McCooey Clearing Corp. and Quantum Resources of
New York.*                                                  

16.1      Letter from BDO Dunwoody, LLP on change in Certifying Accountant      
(Exhibit 16.1 to Form 8-K, filed June 21, 1999)             

22.       Subsidiaries of Registrant (Exhibit 22.1 to Form F-1 Registration     
Number 33-78004, filed April 21, 1994)                      

23.1      Consent of Schwartz Levitsky Feldman, LLP, independent                
accountants.                                                

23.2      Consent of Goldstein & DiGioia, LLP, contained in Exhibit 5.          

Item 28.  Undertakings                                                          

(a)   We hereby undertake:                                          

(1)   To file, during any period in which offers or sales are being 
made, a post-effective amendment to this registration statement;                

      (i)   To include any prospectus required by Section 10 (a) (3)
of the Securities Act of 1933;                                                  

      (ii)  To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most recent      
post-effective amendment thereof) which, individually or in the aggregate,      
represent a fundamental change in the information set forth in the              
registration statement.  Notwithstanding the foregoing, any increase or         
decrease in volume of securities offered (if the total dollar value of          
securities offered would not exceed that which was registered) and any          
deviation from the low or high end of the estimated maximum offering range      
may be reflected in the form of a prospectus filed with the Commission          
under Rule 424(b) if, in the aggregate, the changes in volume and price         
represent no more than a twenty percent change in the maximum aggregate         
offering price set forth in the "Calculation of Registration Fee" table in      
the effective registration statement;                                           

     (iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration statement     
or any material change to such information in the registration statement;       

(2)   That, for the purpose of determining any liability under the  
Securities Act, each such post-effective amendment shall be deemed to be a      
new registration statement relating to the securities offered therein, and      
the offering of such securities at that time shall be deemed to be the          
initial bona fide offering thereof.                                             

(3)   To remove from registration by means of a post-effective      
amendment any of the securities being registered which remain unsold at the     
termination of the offering.                                                    

SIGNATURES    

According to the requirements of the Securities Act of 1933, we     
certify that we have reasonable grounds to believe that we meet all of the      
requirements for filing on Form SB-2 and have duly caused this first            
amendment to our registration statement to be signed on our behalf by the       
undersigned, thereunto duly authorized, in the City of Montreal, Quebec,        
Canada, on December 22, 1999.                                                   

                    THE WIDECOM GROUP INC.

                   By:  /s/ RAJA S. TULI
                      ------------------
                            Raja S. Tuli
                                           Chief Executive Officer and
                         President

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature    
appears below substitutes and appoints Raja S. Tuli his true and lawful         
attorney-in-fact and agents, with full power of substitution and                
resubstitution, for him and in his name, place and stead, in any and all        
capacities, to sign any and all amendments (including post-effective            
amendments) to this registration statement, and to file the same, with all      
exhibits thereto, and other documents in connection therewith, with the         
Securities and Exchange Commission, granting unto said attorney-in-fact and     
agent full power and authority to do and perform each and every act and         
thing requisite and necessary to be don in and about the premises, as fully     
to all intents and purposes as he might or could do in person, hereby           
ratifying and confirming all that said attorney-in-fact and agent or his        
substitute, may lawfully do or cause to be done by virtue hereof.               

 According to the requirements of the Securities Exchange Act of 1933,
this registration statement has been signed below by the following persons      
on our behalf and in the capacities and on the dates indicated.                 

                                                        [Enlarge/Download Table]

Name                                          Title                          Date       
----------------------------------------------------------------------------------------
                                                                                        
/s/ RAJA S. TULI             President, Chief Executive Officer and                     
----------------             Director (Principal Executive Officer)    December 22, 1999
    Raja S. Tuli                                                                        

/s/ WILLEM J. BOTHA          Treasurer and Chief Financial Officer     December 22, 1999
-------------------          (Principal Financial and Accounting                        
    Willem J. Botha          Officer)                                                   

/s/ SUNEET S. TULI           Executive Vice President of Sales and     December 22, 1999
------------------           Marketing, Secretary and Director                          
    Suneet S. Tuli                                                                      

/s/ BRUCE D. VALLILLEE       Director                                  December 22, 1999
----------------------                                                                  
    Bruce D. Vallillee                                                                  

/s/ AJIT SINGH               Director                                  December 22, 1999
--------------                                                                          
    Ajit Singh                                                                          

/s/ Lt. Col. K.C. SHARMA     Director                                  December 22, 1999
------------------------                                                                
    Lt. Col. K.C. Sharma                                                                

Dates Referenced Herein   and   Documents Incorporated by Reference

This ‘SB-2/A’ Filing		Date		Other Filings
		10/8/09
		10/1/04
		8/27/04
		7/26/04		8-K
		4/12/04
		2/19/04
		12/15/00
		3/31/00		10KSB,  NT 10-K
		1/1/00
Filed on:		12/29/99
		12/28/99
		12/22/99
		12/12/99
		10/15/99		SB-2
		10/11/99
		9/30/99		10QSB,  NT 10-Q
		9/28/99
		9/23/99
		8/10/99
		7/16/99
		7/6/99
		7/5/99
		6/30/99		10QSB
		6/29/99		NT 10-K
		6/21/99		8-K
		6/15/99
		5/26/99
		5/21/99
		3/31/99		10KSB,  NT 10-K
		3/15/99
		2/19/99		10QSB
		2/17/99
		1/29/99
		1/27/99		DEF 14A
		9/30/98		10QSB
		9/11/98
		9/9/98
		5/19/98
		5/18/98
		4/24/98
		3/31/98		10-K,  NT 10-K
		2/11/98
		2/2/98		8-K
		2/1/98
		12/15/97
		9/30/97		10-Q,  NT 10-Q
		3/31/97		10-K,  10-K/A,  NT 10-K,  NT 10-K/A
		3/10/97
		3/5/97
		2/27/97
		2/10/97		8-K
		1/30/97		8-K,  DEF 14A
		12/20/96
		12/15/96
		3/31/96		10-K,  NT 10-K
		11/21/94
		5/6/94
		4/21/94
				List all Filings