##### 



---

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

[X]    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarterly Period Ended September 30, 2001

[   ]    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For The Transition Period From _________ to _________

Commission File Number
1-15629

IMPERIAL PARKING
CORPORATION
(Exact name of registrant as specified in its charter)

|                                                                                  |  |                                     
|--------------------------------------------------------------------------------- |  | ------------------------------------
|Delaware                                                                          |  | 31-1537375                          
|                                                                                  |  |                                     
|(State or other jurisdiction
of
incorporation or organization)                    |  | (I.R.S. Employer
Identification No.)
|                                                                                 
|                                                                                 
|601 West Cordova Street,
Suite 300
Vancouver, BC Canada                           |  | V6B 1G1                             
|                                                                                  |  |                                     
|(Address of principal executive offices)                                          |  | (Zip Code)                          
|                                                                                 
|                                                                                 
|Registrants telephone number, including area code:                               |  | (604) 681-7311                      
|                                                                                  |  |                                     
|                                                                                 
|                                                                                 
|                                                                                 
|Former name, former address and former fiscal year, if changed since
last report.

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

|        |  |         
|------- |  | --------
|Yes [x] |  | No [   ]

The number of shares outstanding of each of the registrants classes of common
stock, as of November 8, 2001 was 1,817,142.



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1



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##### 



INDEX

IMPERIAL PARKING CORPORATION

|           |  |                                                                                                              |  |     
|---------- |  | ------------------------------------------------------------------------------------------------------------ |  | ----
|PART I.    |  | FINANCIAL INFORMATION                                                                                        |  | Page
|          
|Item 1.    |  | Financial Statements (Unaudited)                                                                             |  |     
|          
|           |  | Overview of Financial Statements                                                                             |  | 3   
|          
|           |  | Consolidated Balance Sheets
 September 30, 2001 and December 31, 2000                                       |  | 4   
|          
|           |  | Consolidated Statements of Operations
 three months ended September 30, 2001 and 2000                       |  | 5   
|          
|           |  | Consolidated and Pro Forma Combined Statements of Operations
 nine months ended September 30, 2001 and 2000 |  | 6   
|          
|           |  | Consolidated Statement of Stockholders Equity
 nine months ended September 30, 2001                        |  | 7   
|          
|           |  | Consolidated Statements of Cash Flows
 nine months ended September 30, 2001 and 2000                        |  | 8   
|          
|           |  | Notes to Consolidated Financial Statements                                                                   |  | 9   
|          
|Item 2.    |  | Managements Discussion and Analysis of Financial Condition and Results of Operations                        |  | 14  
|          
|Item 3.    |  | Quantitative and Qualitative Disclosure about Market Risk                                                    |  | 18  
|          
|PART II.   |  | OTHER INFORMATION                                                                                            |  |     
|          
|Item 1.    |  | Legal Proceedings                                                                                            |  | 19  
|          
|Item 4.    |  | Submission of Matters to a Vote of Security Holders                                                          |  | 20  
|          
|Item 6.    |  | Exhibits and Reports on Form 8-K                                                                             |  | 20  
|          
|Signatures |  |                                                                                                              |  | 22  

2



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##### 



IMPERIAL PARKING CORPORATION
Overview of Financial Statements

Imperial Parking Corporation (Impark) is the corporation which resulted from
the combination of the Canadian parking assets and operations of First Union
Real Estate Equity and Mortgage Investments (First Union) and the parking
related business of First Union Management, Inc. (FUMI), a related company.

The businesses combined into Impark are referred to for periods prior to the
combination as follows:



| |                                                                                                                                                                                                                                                                                                                                         
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | FUR Parking Business.   The FUR Parking Business, constituting the parking
assets and operations of First Union, consisted primarily of 15 owned
parking properties in Canada. From April 1997 to March 2000 subsidiaries
of First Union operated this business, including leasing the properties to
FUMI for operations and management.



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | FUMI Parking Business.   The FUMI Parking Business consisted of the parking
services and related ancillary activities that were continued into Impark.
From April 1997 to March 2000 subsidiaries of FUMI carried on these
activities. The continuing operations of FUMIs indirect subsidiaries,
Imperial Parking Limited and Impark Services Ltd., consisted of operating
and managing parking facilities in Canada and the United States and
carrying on other parking related activities.

The combination resulting in Impark was completed on March 27, 2000 following a
series of transactions pursuant to a detailed plan of organization. The final
step of the series of transactions was the distribution by First Union of
substantially all of the outstanding shares of common stock of Impark to the
shareholders of First Union. For further information regarding this detailed
plan of organization and distribution of common stock, refer to the Information
Statement on Form 10 dated March 27, 2000.

We accounted for this business combination by the purchase method with the FUR
Parking Business identified as the acquirer. We recognized the business
combination with effect from the close of business on March 31, 2000. The
unaudited pro forma combined statement of operations for the nine months ended
September 30, 2000 presents the results for Impark combined with the FUMI
parking related business, as further described in note 1 (b).

3



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##### 



IMPERIAL PARKING CORPORATION
Consolidated Balance Sheets
Amounts in thousands of United States dollars, except share amounts

|                                |                                                                                                                          |                                      |        |        |              |   |             |        |        |  | 
|------------------------------- | ------------------------------------------------------------------------------------------------------------------------ | ------------------------------------ | ------ | ------ | ------------ | - | ----------- | ------ | ------ |  | 
|                                |                                                                                                                          |                                      |        |        | September 30 |   | December 31
|                                |                                                                                                                          |                                      |        |        | 2001         |   | 2000       
|                                |                                                                                                                          |                                      |        |        |              |   |            
|                                |                                                                                                                          |                                      |        |        | (Unaudited)  |   |             |        |       
|ASSETS                          |                                                                                                                          |                                      |        |        |              |   |             |       
|                               
|                               
|                               
|                               
|Current assets:                 |                                                                                                                          |                                      |        |        |              |   |             |       
|                               
|                               
|                               
|                               
|                                | Cash and cash equivalents                                                                                                |                                      | $      | 11,236 |              |   | $           | 5,615  |       
|                               
|                               
|                               
|                               
|                                | Restricted cash                                                                                                          |                                      |        |       |              |   |             | 2,688  |       
|                               
|                               
|                               
|                               
|                                | Accounts receivable                                                                                                      |                                      |        | 5,732  |              |   |             | 3,561  |       
|                               
|                               
|                               
|                               
|                                | Current portion of recoverable development costs                                                                         |                                      |        | 934    |              |   |             | 969    |       
|                               
|                               
|                               
|                               
|                                | Inventory                                                                                                                |                                      |        | 726    |              |   |             | 748    |       
|                               
|                               
|                               
|                               
|                                | Deposits and prepaid expenses                                                                                            |                                      |        | 1,641  |              |   |             | 821    |       
|                               
|                               
|                               
|                               
|                                | Deferred income taxes                                                                                                    |                                      |        | 2,494  |              |   |             | 1,700  |       
|                                |                                                                                                                          |                                      |        |        |              |   |             |       
|                                |                                                                                                                          | Total current assets                 |        |        | 22,763       |   |             |        | 16,102 | 
|                               
|                               
|                               
|                               
|Recoverable development costs   |                                                                                                                          |                                      | 4,057  |        |              |   | 4,614       |       
|                               
|                               
|                               
|                               
|Fixed assets                    |                                                                                                                          |                                      | 14,595 |        |              |   | 14,299      |       
|                               
|                               
|                               
|                               
|Management and lease agreements |                                                                                                                          |                                      | 458    |        |              |   | 416         |       
|                               
|                               
|                               
|                               
|Other assets                    |                                                                                                                          |                                      | 2,856  |        |              |   | 2,829       |       
|                               
|                               
|                               
|                               
|Goodwill                        |                                                                                                                          |                                      | 45,058 |        |              |   | 41,131      |       
|                                |                                                                                                                          |                                      |        |        |              |   |             |       
|                                |                                                                                                                          | $                                    | 89,787 |        |              | $ | 79,391      |       
|                                |                                                                                                                          |                                      |        |        |              |   |             |       
|                                |                                                                                                                          | LIABILITIES AND STOCKHOLDERS EQUITY |        |        |              |   |             |        |        | 
|                               
|                               
|                               
|                               
|Current liabilities:            |                                                                                                                          |                                      |        |        |              |   |             |       
|                               
|                               
|                               
|                               
|                                | Rents payable                                                                                                            |                                      | $      | 7,967  |              |   | $           | 6,871  |       
|                               
|                               
|                               
|                               
|                                | Trade accounts payable and other accrued liabilities                                                                     |                                      |        | 4,307  |              |   |             | 3,889  |       
|                               
|                               
|                               
|                               
|                                | Payable to employees and former employees                                                                                |                                      |        | 2,006  |              |   |             | 2,159  |       
|                               
|                               
|                               
|                               
|                                | Sales tax payable                                                                                                        |                                      |        | 1,663  |              |   |             | 1,370  |       
|                               
|                               
|                               
|                               
|                                | Current portion of long-term debt                                                                                        |                                      |        | 514    |              |   |             |       |       
|                               
|                               
|                               
|                               
|                                | Current portion of other long-term liabilities                                                                           |                                      |        | 1,125  |              |   |             |       |       
|                               
|                               
|                               
|                               
|                                | Deferred revenue                                                                                                         |                                      |        | 1,845  |              |   |             | 1,717  |       
|                                |                                                                                                                          |                                      |        |        |              |   |             |       
|                                |                                                                                                                          | Total current liabilities            |        |        | 19,427       |   |             |        | 16,006 | 
|                               
|                               
|                               
|                               
|Long-term debt (note 3)         |                                                                                                                          |                                      | 3,386  |        |              |   |            |       
|                               
|                               
|                               
|                               
|Other long-term liabilities     |                                                                                                                          |                                      | 4,948  |        |              |   | 1,656       |       
|                               
|                               
|                               
|                               
|Deferred income taxes           |                                                                                                                          |                                      | 3,216  |        |              |   | 1,700       |       
|                                |                                                                                                                          |                                      |        |        |              |   |             |       
|                                |                                                                                                                          | Total liabilities                    |        |        | 30,977       |   |             |        | 19,362 | 
|                               
|                               
|                               
|                               
|Stockholders equity:           |                                                                                                                          |                                      |        |        |              |   |             |       
|                               
|                               
|                               
|                               
|                                | Common stock, $.01 par value; 10,000,000 shares authorized
1,816,517 shares issued and outstanding    (2000 
1,843,000) |                                      |        | 18     |              |   |             | 18     |       
|                               
|                               
|                               
|                               
|                                | Additional paid-in capital                                                                                               |                                      |        | 60,431 |              |   |             | 59,991 |       
|                               
|                               
|                               
|                               
|                                | Retained earnings                                                                                                        |                                      |        | 2,316  |              |   |             | 1,464  |       
|                               
|                               
|                               
|                               
|                                | Accumulated other comprehensive lossForeign currency translation adjustment                                              |                                      |        | (3,955 | )            |   |             | (1,444 | )     
|                                |                                                                                                                          |                                      |        |        |              |   |             |       
|                                |                                                                                                                          | Total stockholders equity           |        |        | 58,810       |   |             |        | 60,029 | 
|                                |                                                                                                                          |                                      |        |        |              |   |             |       
|                                |                                                                                                                          | $                                    | 89,787 |        |              | $ | 79,391      |       
|                                |                                                                                                                          |                                      |        |        |              |   |             |       

4



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##### 



IMPERIAL PARKING CORPORATIONConsolidated Statements of Operations
(Unaudited)
Amounts in thousands of United States dollars, except per share amounts

|                               |         |                                                                  |        |                                 |       |      |        |      |       | 
|------------------------------ | ------- | ---------------------------------------------------------------- | ------ | ------------------------------- | ----- | ---- | ------ | ---- | ----- | 
|                               |         |                                                                  |        | Three Months Ended September 30
|                               |         |                                                                  |        |                                
|                               |         |                                                                  |        | 2001                            |       | 2000
|                               |         |                                                                  |        |                                 |       |     
|Revenues                       |         | $                                                                | 24,008 |                                 |       | $    | 18,529 |     
|                              
|                              
|                              
|                              
|Direct cost                    |         |                                                                  | 18,461 |                                 |       |      | 13,796 |     
|                               |         |                                                                  |        |                                 |       |      |        |     
|Gross margin                   |         |                                                                  | 5,547  |                                 |       |      | 4,733  |     
|                              
|                              
|                              
|                              
|Other operating expenses:      |         |                                                                  |        |                                 |       |      |        |     
|                              
|                              
|                              
|                              
|                               |         | General and administrative                                       |        |                                 | 3,839 |      |        |      | 3,026 | 
|                              
|                              
|                              
|                              
|                               |         | Depreciation and amortization of
management and
lease agreements |        |                                 | 624   |      |        |      | 657   | 
|                              
|                              
|                              
|                              
|                               |         | Amortization of goodwill                                         |        |                                 | 552   |      |        |      | 547   | 
|                              
|                              
|                              
|                              
|                               |         | Equity share of limited liability
company losses                 |        |                                 | 37    |      |        |      |      | 
|                               |         |                                                                  |        |                                 |       |      |        |     
|Total other operating expenses |         |                                                                  | 5,052  |                                 |       |      | 4,230  |     
|                               |         |                                                                  |        |                                 |       |      |        |     
|Operating income               |         |                                                                  | 495    |                                 |       |      | 503    |     
|                              
|                              
|                              
|                              
|Other income (expense):        |         |                                                                  |        |                                 |       |      |        |     
|                              
|                              
|                              
|                              
|                               |         | Interest income                                                  |        |                                 | 151   |      |        |      | 222   | 
|                              
|                              
|                              
|                              
|                               |         | Interest expense                                                 |        |                                 | (154  | )    |        |      |      | 
|                               |         |                                                                  |        |                                 |       |      |        |     
|Other income (expense), net    |         |                                                                  | (3     | )                               |       |      | 222    |     
|                               |         |                                                                  |        |                                 |       |      |        |     
|Earnings before income taxes   |         |                                                                  | 492    |                                 |       |      | 725    |     
|                              
|                              
|                              
|                              
|Income tax expense            
|                              
|                              
|                              
|                              
|                               |         | Current                                                          |        |                                 | 16    |      |        |      | 151   | 
|                              
|                              
|                              
|                              
|                               |         | Deferred                                                         |        |                                 | 184   |      |        |      |      | 
|                               |         |                                                                  |        |                                 |       |      |        |     
|                               |         |                                                                  | 200    |                                 |       |      | 151    |     
|                               |         |                                                                  |        |                                 |       |      |        |     
|Net earnings                   |         | $                                                                | 292    |                                 |       | $    | 574    |     
|                               |         |                                                                  |        |                                 |       |      |        |     
|Earnings per share:            |         |                                                                  |        |                                 |       |      |        |     
|                              
|                              
|                              
|                              
|                               | Basic   |                                                                  | $      | 0.16                            |       |      | $      | 0.27 |      
|                               |         |                                                                  |        |                                 |       |      |        |     
|                               | Diluted |                                                                  | $      | 0.15                            |       |      | $      | 0.27 |      
|                               |         |                                                                  |        |                                 |       |      |        |     

5



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##### 



IMPERIAL PARKING CORPORATION
Consolidated and Pro Forma Combined Statements of Operations
(Unaudited)
Amounts in thousands of United States dollars, except per share amounts

|                               |                                                                  |   |        |                                |   |      |        |       |   |   |        |              |  | 
|------------------------------ | ---------------------------------------------------------------- | - | ------ | ------------------------------ | - | ---- | ------ | ----- | - | - | ------ | ------------ |  | 
|                               |                                                                  |   |        | Nine Months Ended September 30
|                               |                                                                  |   |        |                               
|                               |                                                                  |   |        |                                |   |      |        |       |   |   |        | Pro
Forma   
|                               |                                                                  |   |        | 2001                           |   | 2000 |        | 2000 
|                               |                                                                  |   |        |                                |   |      |        |      
|                               |                                                                  |   |        |                                |   |      |        |       |   |   |        | (note 1 (b))
|Revenues                       |                                                                  | $ | 64,374 |                                |   | $    | 36,517 |       |   | $ | 51,021 |             
|                              
|                              
|                              
|                              
|Direct cost                    |                                                                  |   | 48,890 |                                |   |      | 26,962 |       |   |   | 37,832 |             
|                               |                                                                  |   |        |                                |   |      |        |       |   |   |        |             
|Gross margin                   |                                                                  |   | 15,484 |                                |   |      | 9,555  |       |   |   | 13,189 |             
|                              
|                              
|                              
|                              
|Other operating expenses:      |                                                                  |   |        |                                |   |      |        |       |   |   |        |             
|                              
|                              
|                              
|                              
|                               | General and administrative                                       |   |        | 10,510                         |   |      |        | 5,923 |   |   |        | 8,590        | 
|                              
|                              
|                              
|                              
|                               | Depreciation and amortization of
management and lease agreements |   |        | 1,742                          |   |      |        | 1,256 |   |   |        | 1,814        | 
|                              
|                              
|                              
|                              
|                               | Amortization of goodwill                                         |   |        | 1,665                          |   |      |        | 1,158 |   |   |        | 1,651        | 
|                              
|                              
|                              
|                              
|                               | Equity share of limited liability
company losses                 |   |        | 114                            |   |      |        |      |   |   |        |             | 
|                               |                                                                  |   |        |                                |   |      |        |       |   |   |        |             
|Total other operating expenses |                                                                  |   | 14,031 |                                |   |      | 8,337  |       |   |   | 12,055 |             
|                               |                                                                  |   |        |                                |   |      |        |       |   |   |        |             
|Operating income               |                                                                  |   | 1,453  |                                |   |      | 1,218  |       |   |   | 1,134  |             
|                              
|                              
|                              
|                              
|Other income (expenses):       |                                                                  |   |        |                                |   |      |        |       |   |   |        |             
|                              
|                              
|                              
|                              
|                               | Interest income                                                  |   |        | 455                            |   |      |        | 1,574 |   |   |        | 539          | 
|                              
|                              
|                              
|                              
|                               | Interest expense                                                 |   |        | (154                           | ) |      |        | (786  | ) |   |        |             | 
|                               |                                                                  |   |        |                                |   |      |        |       |   |   |        |             
|Other income, net              |                                                                  |   | 301    |                                |   |      | 788    |       |   |   | 539    |             
|                               |                                                                  |   |        |                                |   |      |        |       |   |   |        |             
|Earnings before income taxes   |                                                                  |   | 1,754  |                                |   |      | 2,006  |       |   |   | 1,673  |             
|                              
|                              
|                              
|                              
|Income tax expense            
|                              
|                              
|                              
|                              
|                               | Current                                                          |   |        | 73                             |   |      |        | 245   |   |   |        | 306          | 
|                              
|                              
|                              
|                              
|                               | Deferred                                                         |   |        | 829                            |   |      |        |      |   |   |        |             | 
|                               |                                                                  |   |        |                                |   |      |        |       |   |   |        |             
|                               |                                                                  |   | 902    |                                |   |      | 245    |       |   |   | 306    |             
|                               |                                                                  |   |        |                                |   |      |        |       |   |   |        |             
|Net earnings                   |                                                                  | $ | 852    |                                |   | $    | 1,761  |       |   | $ | 1,367  |             
|                               |                                                                  |   |        |                                |   |      |        |       |   |   |        |             
|Earnings per share:            |                                                                  |   |        |                                |   |      |        |       |   |   |        |             
|                              
|                              
|                              
|                              
|                               | Basic                                                            |   | $      | 0.47                           |   |      | $      | 0.83  |   |   | $      | 0.65         | 
|                               |                                                                  |   |        |                                |   |      |        |       |   |   |        |             
|                               | Diluted                                                          |   | $      | 0.46                           |   |      | $      | 0.83  |   |   | $      | 0.65         | 
|                               |                                                                  |   |        |                                |   |      |        |       |   |   |        |             

6



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##### 



IMPERIAL PARKING CORPORATION
Consolidated Statement of Stockholders Equity
Amounts in Thousands of United States dollars, except number of common shares

|                                                            |  |              |           |            |  |          |    |             |  |            |        |       |  |               |       |  |  |         |        |   |  |   |        |   |  |   |        |  
|----------------------------------------------------------- |  | ------------ | --------- | ---------- |  | -------- | -- | ----------- |  | ---------- | ------ | ----- |  | ------------- | ----- |  |  | ------- | ------ | - |  | - | ------ | - |  | - | ------ | -
|                                                            |  |              |           |            |  |          |    |             |  |            |        |       |  |               |       |  |  | Foreign |        |   |  |   |        |   |  |  
|                                                            |  | Common stock |           | Additional |  |          |    |             |  | currency   |        |       |  |               |       |  |  |        
|                                                            |  |              |           | paid-in    |  | Retained |    | translation |  |            |        |       |  | Comprehensive
|                                                            |  | Number       |           | Par value  |  | capital  |    | earnings    |  | adjustment |        | Total |  | loss         
|                                                            |  |              |           |            |  |          |    |             |  |            |        |       |  |              
|Balance, December 31, 2000                                  |  |              | 1,843,000 |            |  | $        | 18 |             |  | $          | 59,991 |       |  | $             | 1,464 |  |  | $       | (1,444 | ) |  | $ | 60,029 |   |  |   |        |  
|                                                           
|                                                           
|                                                           
|                                                           
|Net earnings for the period                                 |  |              |          |            |  |          |   |             |  |            |       |       |  |               | 852   |  |  |         |       |   |  |   | 852    |   |  |   | 852    |  
|                                                           
|                                                           
|                                                           
|                                                           
|Foreign currency translation adjustment in period           |  |              |          |            |  |          |   |             |  |            |       |       |  |               |      |  |  |         | (2,511 | ) |  |   | (2,511 | ) |  |   | (2,511 | )
|                                                           
|                                                           
|                                                           
|                                                           
|Stock-based compensation                                    |  |              |          |            |  |          |   |             |  |            | 922    |       |  |               |      |  |  |         |       |   |  |   | 922    |   |  |   |        |  
|                                                           
|                                                           
|                                                           
|                                                           
|Options exercised                                           |  |              | 4,375     |            |  |          |   |             |  |            | 61     |       |  |               |      |  |  |         |       |   |  |   | 61     |   |  |   |        |  
|                                                           
|                                                           
|                                                           
|                                                           
|Shares repurchased                                          |  |              | (30,858   | )          |  |          |   |             |  |            | (543   | )     |  |               |      |  |  |         |       |   |  |   | (543   | ) |  |   |        |  
|                                                            |  |              |           |            |  |          |    |             |  |            |        |       |  |               |       |  |  |         |        |   |  |   |        |   |  |   |        |  
|Total
stockholders equityat September 30, 2001 (unaudited) |  |              | 1,816,517 |            |  | $        | 18 |             |  | $          | 60,431 |       |  | $             | 2,316 |  |  | $       | (3,955 | ) |  | $ | 58,810 |   |  |   |        |  
|                                                            |  |              |           |            |  |          |    |             |  |            |        |       |  |               |       |  |  |         |        |   |  |   |        |   |  |   |        |  
|Comprehensive loss (unaudited)                              |  |              |           |            |  |          |    |             |  |            |        |       |  |               |       |  |  |         |        |   |  |   |        |   |  | $ | (1,659 | )
|                                                            |  |              |           |            |  |          |    |             |  |            |        |       |  |               |       |  |  |         |        |   |  |   |        |   |  |   |        |  

7



---



##### 



IMPERIAL PARKING CORPORATION
Consolidated Statements of Cash Flows
(Unaudited)
Amounts in thousands of United States dollars

|                                                                                |                                                                                      |   |                                                              |        |                   |        |        |         |   |         |  
|------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------ | - | ------------------------------------------------------------ | ------ | ----------------- | ------ | ------ | ------- | - | ------- | -
|                                                                                |                                                                                      |   |                                                              |        | Nine Months Ended
|                                                                                |                                                                                      |   |                                                              |        | September 30     
|                                                                                |                                                                                      |   |                                                              |        |                  
|                                                                                |                                                                                      |   |                                                              |        | 2001              |        | 2000  
|                                                                                |                                                                                      |   |                                                              |        |                   |        |       
|Cash
flows from operating activities:                                           |                                                                                      |   |                                                              |        |                   |        |        |        
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Net earnings                                                                    |                                                                                      | $ | 852                                                          |        |                   | $      | 1,761  |        
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Adjustments to reconcile net earnings to cash provided by operating activities: |                                                                                      |   |                                                              |        |                   |        |        |        
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Depreciation and amortization of management and lease agreements                     |   |                                                              | 1,742  |                   |        |        | 1,256   |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Amortization of goodwill                                                             |   |                                                              | 1,665  |                   |        |        | 1,158   |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Recovery of recoverable development costs                                            |   |                                                              | 806    |                   |        |        | 478     |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Equity share of limited liability company losses                                     |   |                                                              | 114    |                   |        |        |        |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Deferred income taxes                                                                |   |                                                              | 829    |                   |        |        |        |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Stock-based compensation                                                             |   |                                                              | 516    |                   |        |        | 114     |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Non-cash interest expense                                                            |   |                                                              | 77     |                   |        |        |        |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Interest income capitalized to note receivable                                       |   |                                                              |       |                   |        |        | (697    | )
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Interest expense capitalized to note payable                                         |   |                                                              |       |                   |        |        | 786     |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Changes in non-cash working capital items, excluding acquisitions:                   |   |                                                              |        |                   |        |        |         |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                |                                                                                      |   | Restricted cash                                              |        |                   | 2,688  |        |         |   |        |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                |                                                                                      |   | Accounts receivable                                          |        |                   | (164   | )      |         |   | (444    | )
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                |                                                                                      |   | Inventory                                                    |        |                   | (19    | )      |         |   | 14      |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                |                                                                                      |   | Deposits and prepaid expenses                                |        |                   | (325   | )      |         |   | (215    | )
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                |                                                                                      |   | Rents payable                                                |        |                   | 1,311  |        |         |   | 992     |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                |                                                                                      |   | Trade accounts payable and other accrued liabilities         |        |                   | (312   | )      |         |   | (495    | )
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                |                                                                                      |   | Payable to employees and former employees                    |        |                   | (429   | )      |         |   | (114    | )
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                |                                                                                      |   | Sales tax payable                                            |        |                   | 193    |        |         |   | (1,473  | )
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                |                                                                                      |   | Deferred revenue                                             |        |                   | 195    |        |         |   | (4,044  | )
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                |                                                                                      |   | Interest receivable on notes receivable from related parties |        |                   |       |        |         |   | 8       |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                |                                                                                      |   | Receivables from related parties                             |        |                   |       |        |         |   | (127    | )
|                                                                                |                                                                                      |   |                                                              |        |                   |        |        |        
|                                                                                |                                                                                      |   | Net cash provided by (used in) operating activities          |        |                   | 9,739  |        |         |   | (1,042  | )
|                                                                                |                                                                                      |   |                                                              |        |                   |        |        |        
|Cash flows from investing activities:                                           |                                                                                      |   |                                                              |        |                   |        |        |        
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Purchase of fixed assets                                                             |   |                                                              | (1,794 | )                 |        |        | (711    | )
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Acquisition of minority interests in FUMI parking related business                   |   |                                                              |       |                   |        |        | (453    | )
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Repayment of outstanding credit facilities                                           |   |                                                              |       |                   |        |        | (26,369 | )
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Cash position of business acquired                                                   |   |                                                              |       |                   |        |        | 8,123   |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Increase in recoverable development costs                                            |   |                                                              | (185   | )                 |        |        | (409    | )
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Change in other assets                                                               |   |                                                              | (502   | )                 |        |        | 1,492   |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Acquisition of parking business, net of cash acquired                                |   |                                                              | (4,564 | )                 |        |        | (1,219  | )
|                                                                                |                                                                                      |   |                                                              |        |                   |        |        |        
|                                                                                |                                                                                      |   | Net cash used in investing activities                        |        |                   | (7,045 | )      |         |   | (19,546 | )
|                                                                                |                                                                                      |   |                                                              |        |                   |        |        |        
|Cash flows from financing activities:                                           |                                                                                      |   |                                                              |        |                   |        |        |        
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Purchase of common shares                                                            |   |                                                              | (543   | )                 |        |        | (657    | )
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Options exercised                                                                    |   |                                                              | 61     |                   |        |        |        |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Cash contributions, including $26,369 to repay assumed outstanding credit
facilities |   |                                                              |       |                   |        |        | 32,701  |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Increase in long-term debt                                                           |   |                                                              | 3,900  |                   |        |        |        |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Change in other liabilities                                                          |   |                                                              | (53    | )                 |        |        | (93     | )
|                                                                                |                                                                                      |   |                                                              |        |                   |        |        |        
|                                                                                |                                                                                      |   | Net cash provided by financing activities                    |        |                   | 3,365  |        |         |   | 31,951  |  
|                                                                                |                                                                                      |   |                                                              |        |                   |        |        |        
|Effect of exchange rate changes on cash and cash equivalents                    |                                                                                      |   | (438                                                         | )      |                   |        | (314   | )      
|                                                                                |                                                                                      |   |                                                              |        |                   |        |        |        
|Increase in cash and cash equivalents                                           |                                                                                      |   | 5,621                                                        |        |                   |        | 11,049 |        
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Cash and cash equivalents, beginning of period                                  |                                                                                      |   | 5,615                                                        |        |                   |        | 1,984  |        
|                                                                                |                                                                                      |   |                                                              |        |                   |        |        |        
|Cash and cash equivalents, end of period                                        |                                                                                      | $ | 11,236                                                       |        |                   | $      | 13,033 |        
|                                                                                |                                                                                      |   |                                                              |        |                   |        |        |        
|Supplementary information:                                                      |                                                                                      |   |                                                              |        |                   |        |        |        
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Income taxes paid                                                                    |   | $                                                            | 172    |                   |        | $      | 400     |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Non-cash transactions:                                                          |                                                                                      |   |                                                              |        |                   |        |        |        
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Imputed interest expense on DLC purchase price                                       |   |                                                              | 77     |                   |        |        |        |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Interest income capitalized to notes receivable                                      |   |                                                              |       |                   |        |        | 697     |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|                                                                                | Interest expense capitalized to note payable                                         |   |                                                              |       |                   |        |        | 786     |  

8



---



##### 



IMPERIAL PARKING CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)



|1. |  | ORGANIZATION AND BASIS OF PRESENTATION
|-- |  | --------------------------------------

The accompanying unaudited consolidated financial statements of Imperial
Parking Corporation (Impark) do not include all of the information and
footnotes required by generally accepted accounting principles for a complete
set of annual financial statements. In the opinion of management, all
adjustments (consisting solely of normal recurring adjustments) considered
necessary for a fair presentation of the financial position, results from
operations and cash flows as at September 30, 2001, and for all periods
presented, have been included. These financial statements should be read in
conjunction with the financial statements, and notes thereto, included in
Imparks annual report on Form 10-K for the fiscal year ended December 31,
2000. Operating results for the nine months ended September 30, 2001 are not
necessarily indicative of the results that may by expected for the fiscal year
ending December 31, 2001.



|(a) |  | Organization                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|    |  | Impark is the corporation which resulted from the combination of the Canadian
parking facilities of First Union Real Estate Equity and Mortgage Investments
(the FUR Parking Business) and the parking related businesses of First Union
Management, Inc. (the FUMI Parking Business). We have set out below a
brief description of the operations of each business combined.                                                                                                                 
|   
|    |  | FUR Parking Business  The FUR Parking Business, constituting the parking
assets and operations of First Union, consisted primarily of 15 owned parking
properties in Canada. From April 1997 to March 2000, subsidiaries of First
Union operated this business, including leasing the properties to First Union
Management, Inc. (FUMI) for operations and management.                                                                                                                         
|   
|    |  | FUMI Parking Business  The FUMI Parking Business consisted of the parking
services and related ancillary activities that have been continued into
Impark. From April 1997 to March 2000, subsidiaries of FUMI carried on these
activities. The continuing operations of FUMIs indirect subsidiaries,
Imperial Parking Limited and Impark Services Ltd., consisted of operating and
managing parking facilities in Canada and the United States and carrying on
other parking related activities.
|   
|    |  | The accompanying unaudited consolidated financial statements include the
accounts of Impark and its wholly owned subsidiaries and reflect Imparks
acquisition of the FUMI Parking Business which has been accounted                                                                                                                                                                                                                                                                              

9



---



##### 





|    |  | for with effect from the close of business on March 31, 2000. All material
inter-company transactions and balances have been eliminated.
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------
|   
|(b) |  | Pro forma                                                                                                                               
|   
|    |  | The pro forma statement of operations for the nine months ended September 30,
2000 has been compiled from financial information in the: 



| | (i)   |  | unaudited combined financial statements of Impark, including
its predecessor the FUR Parking Business, for the nine months ended
September 30, 2000;                            
| | ----- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (ii)  |  | unaudited combined financial statements of the FUMI Parking
Business for the three months ended March 31, 2000; and                                                             
|
| | (iii) |  | the additional information presented below.                                                                                                                                     
|
| |       |  | The pro forma combined statement of operations reflects the combination
of Impark and the FUMI Parking Business with effect from January 1, 2000
and the following transactions:
|

| | (a) |  | the elimination of inter-entity lease fees and interest
costs;                                                                                                                                                                                                                           
| | --- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (b) |  | the elimination of an asset management fee earned by the
FUMI Parking Business during the period January 1, 2000 to March
31, 2000 for managing the United States parking properties of First
Union. The fee agreement was cancelled on the acquisition of the
FUMI Parking Business; and
|
| | (c) |  | the elimination of interest expense on long-term debt
repaid and the note payable capitalized on the acquisition of the
FUMI Parking Business.                                                                                                                                           
|

| |  |  | For purposes of the pro forma combined statements of operations, no
adjustments have been made for interest on additional cash balances.
| |  |  | ----------------------------------------------------------------------------------------------------------------------------------------

These pro forma combined statements of operations are not necessarily
indicative of the results of operations that would have been achieved had the
transactions actually taken place on January 1, 2000 and do not purport to be
indicative of the effects that may be expected to occur in the future.



|2. |  | ACQUISITION
|-- |  | -----------

Effective July 1, 2001, the Company acquired all of the issued and
outstanding shares of DLC Management Group, Inc. (DLC) for net cash of $4.6
million, including acquisition expenses of $0.2 million. The former
shareholders of DLC are also entitled to additional cash consideration equal to
a proportion of the actual operating results of the acquired business,
calculated in accordance with the acquisition agreement, for each of the twelve
month periods ending June 30, 2002 through 2006. The present value of these
future payments has been estimated to be $4.4 million and has been included in
the cost of the acquisition. The liability for these payments has been included
on the Companys Balance Sheet at September 30, 2001 in Other long-term
liabilities.

The acquisition of DLC has been accounted for by the purchase method and
accordingly the aggregate purchase price, including related costs, has been
allocated to assets acquired and liabilities assumed based on their estimated
fair values as of the acquisition date as follows:

|                                              |  |       |       | 
|--------------------------------------------- |  | ----- | ----- | 
|                                              |  | $'000
|                                              |  |      
|Working capital, net of cash acquired of $259 |  | $     | 748   | 
|                                             
|                                             
|                                             
|                                             
|Fixed assets                                  |  |       | 558   | 
|                                             
|                                             
|                                             
|                                             
|Management and lease agreements               |  |       | 344   | 
|                                             
|                                             
|                                             
|                                             
|Goodwill                                      |  |       | 7,300 | 
|                                              |  |       |       | 
|                                              |  | $     | 8,950 | 
|                                              |  |       |       | 

10



---



##### 



The purchase price paid by the Company is subject to certain adjustments
prior to December 31, 2001 pursuant to the acquisition agreement. Management
has made its best estimate of the purchase price ultimately payable by the
Company. Any adjustments made to the purchase price will be accounted for in
the period the adjustments are made.

The results of operations of DLC from July 1, 2001, being the effective
date of acquisition by the Company, are included in these consolidated
financial statements.



|3. |  | LONG-TERM DEBT
|-- |  | --------------

On September 13, 2000, the Company established a credit facility (the
Credit Facility) providing for borrowings of up to $20 million, consisting of
a $12.5 million non-revolving loan; a $5 million revolving credit facility; and
$2.5 million for standby letters of credit. The non-revolving loan facility
bears interest at LIBOR plus 1.625% per annum. The revolving credit facility
bears interest at the lending banks prime rate. The amount outstanding under
the Companys Credit Facility as of September 30, 2001 was $3.9 million with a
weighted average interest rate of 4.1%. This is solely comprised of amounts
drawn under the non-revolving loan facility and will be repaid in blended
monthly payments of principal and interest of $61,114 through December 2007.
The Credit Facility contains covenants including those that require the Company
to maintain certain financial ratios and restrict further indebtedness. The
remaining amount available under the Credit Facility was $13.3 million at
September 30, 2001.



|4. |  | EARNINGS PER SHARE
|-- |  | ------------------

Basic earnings per share is computed by dividing income available to
common shareholders by the weighted-average number of common shares outstanding
for the period. The weighted average number of shares outstanding for the nine
months ended September 30, 2000 gives retroactive effect to the shares issued
on the formation of Impark. Diluted earnings per share reflects the potential
dilution that would occur if securities or other contracts to issue common
stock were exercised or converted into common stock or resulted in the issuance
of common stock, or if restricted shares of common stock were to become fully
vested, that then shared in the earnings of Impark.

The following tables set forth the computation of basic and diluted earnings
per share:

|                                      |                   |                                 |     |         |  |           |       |           |  |         |      |           |   |   |     |     |  |  |       |       |  |   |      |      | 
|------------------------------------- | ----------------- | ------------------------------- | --- | ------- |  | --------- | ----- | --------- |  | ------- | ---- | --------- | - | - | --- | --- |  |  | ----- | ----- |  | - | ---- | ---- | 
|                                      |                   |                                
|                                      |                   | Three Months Ended September 30
|                                      |                   |                                
|                                      |                   |                                 |     |        
|                                      |                   | 2001                            |     | 2000   
|                                      |                   |                                 |     |        
|                                      |                   | Income                          |     | Common  |  |           |       | Income    |  | Common  |      |          
|                                      |                   | available                       |     | shares  |  | Per Share |       | available |  | shares  |      | Per Share
|                                      |                   | ($000s)                        |     | (000s) |  | amount    |       | ($000s)  |  | (000s) |      | amount   
|                                      |                   |                                 |     |         |  |           |       |           |  |         |      |          
|Basic earnings per share              |                   |                                 |     |         |  |           |       |           |  |         |      |           |   |   |     |     |  |  |       |       |  |   |      |     
|                                      | Net earnings      |                                 | $   | 292     |  |           |       | 1,812     |  |         | $    | 0.16      |   |   | $   | 574 |  |  |       | 2,102 |  |   | $    | 0.27 | 
|                                     
|                                     
|                                     
|                                     
|Effect of dilutive stock and options: |                   |                                 |     |         |  |           |       |           |  |         |      |           |   |   |     |     |  |  |       |       |  |   |      |     
|                                      | Stock option plan |                                 |     |        |  |           |       | 99        |  |         |      | (0.01     | ) |   |     |    |  |  |       |      |  |   |      |     | 
|                                      |                   |                                 |     |         |  |           |       |           |  |         |      |           |   |   |     |     |  |  |       |       |  |   |      |     
|Diluted earnings per share            |                   | $                               | 292 |         |  |           | 1,911 |           |  | $       | 0.15 |           |   | $ | 574 |     |  |  | 2,102 |       |  | $ | 0.27 |     
|                                      |                   |                                 |     |         |  |           |       |           |  |         |      |           |   |   |     |     |  |  |       |       |  |   |      |     

11



---



##### 



|                                      |                    |           |                                |         |  |           |       |           |  |         |      |           |   |   |       |       |  |  |       |       |  |   |      |      | 
|------------------------------------- | ------------------ | --------- | ------------------------------ | ------- |  | --------- | ----- | --------- |  | ------- | ---- | --------- | - | - | ----- | ----- |  |  | ----- | ----- |  | - | ---- | ---- | 
|                                      |                    |           |                                |         |  |           |       |          
|                                      |                    |           | Nine Months Ended September 30
|                                      |                    |           |                               
|                                      |                    |           |                                |        
|                                      |                    | 2001      |                                | 2000   
|                                      |                    |           |                                |        
|                                      |                    | Income    |                                | Common  |  |           |       | Income    |  | Common  |      |          
|                                      |                    | available |                                | shares  |  | Per Share |       | available |  | shares  |      | Per Share
|                                      |                    | ($000s)  |                                | (000s) |  | amount    |       | ($000s)  |  | (000s) |      | amount   
|                                      |                    |           |                                |         |  |           |       |           |  |         |      |          
|Basic earnings per share              |                    |           |                                |         |  |           |       |           |  |         |      |           |   |   |       |       |  |  |       |       |  |   |      |     
|                                      | Net earnings       |           | $                              | 852     |  |           |       | 1,816     |  |         | $    | 0.47      |   |   | $     | 1,761 |  |  |       | 2,119 |  |   | $    | 0.83 | 
|                                     
|                                     
|                                     
|                                     
|Effect of dilutive stock and options: |                    |           |                                |         |  |           |       |           |  |         |      |           |   |   |       |       |  |  |       |       |  |   |      |     
|                                      | Stock option plan  |           |                                |        |  |           |       | 36        |  |         |      | (0.01     | ) |   |       |      |  |  |       |      |  |   |      |     | 
|                                      |                    |           |                                |         |  |           |       |           |  |         |      |           |   |   |       |       |  |  |       |       |  |   |      |     
|Diluted earnings per share            |                    | $         | 852                            |         |  |           | 1,852 |           |  | $       | 0.46 |           |   | $ | 1,761 |       |  |  | 2,119 |       |  | $ | 0.83 |     
|                                      |                    |           |                                |         |  |           |       |           |  |         |      |           |   |   |       |       |  |  |       |       |  |   |      |     
|Basic pro forma earnings per share    |                    |           |                                |         |  |           |       |           |  |         |      |           |   |   |       |       |  |  |       |       |  |   |      |     
|                                      | Pro forma earnings |           |                                | n/a     |  |           |       | n/a       |  |         |      | n/a       |   |   | $     | 1,367 |  |  |       | 2,119 |  |   | $    | 0.65 | 
|                                     
|                                     
|                                     
|                                     
|Effect of dilutive stock and options: |                    |           |                                |         |  |           |       |           |  |         |      |           |   |   |       |       |  |  |       |       |  |   |      |     
|                                      | Stock option plan  |           |                                |        |  |           |       |          |  |         |      |          |   |   |       |      |  |  |       |      |  |   |      |     | 
|                                      |                    |           |                                |         |  |           |       |           |  |         |      |           |   |   |       |       |  |  |       |       |  |   |      |     
|Diluted pro forma earnings per share  |                    |           | n/a                            |         |  |           | n/a   |           |  |         | n/a  |           |   | $ | 1,367 |       |  |  | 2,119 |       |  | $ | 0.65 |     
|                                      |                    |           |                                |         |  |           |       |           |  |         |      |           |   |   |       |       |  |  |       |       |  |   |      |     



|5. |  | STOCK OPTIONS
|-- |  | -------------

In May 2001, the stockholders of the Company approved a stock option
incentive plan allowing the Company to grant stock options to executives and
management. The plan includes variable stock options whereby the exercise
price of the options increases during the term of the options. Any change in
the intrinsic value of the options is reflected as compensation expense. For
accounting purposes, the date of stockholder approval is considered to be the
date on which the measurement of any compensatory effect occurs. At September
30, 2001, the Company had the following stock options outstanding:

|                                                         |  |                                                              |  |                                                                                                                      |  |  |  |  |  | 
|-------------------------------------------------------- |  | ------------------------------------------------------------ |  | -------------------------------------------------------------------------------------------------------------------- |  |  |  |  |  | 
|# of options                                             |  | Exercise price                                               |  | Remaining contractual life                                                                                          
|                                                         |  |                                                              |  |                                                                                                                     
|2501,00039,125116,87579,7771,0005007502,0001,0002,000500 |  | 14.0914.0914.0914.6314.7817.8817.9420.0820.5225.3025.8025.85 |  | 2 months3 months103 months103 months101 months108 months106 months111 months112 months116 months114 months117 months



|6. |  | BUSINESS SEGMENTS
|-- |  | -----------------

Senior management of the Company reviews the revenue and overall results
of operations by geographic regions. The following table summarizes the
revenue, operating results and assets for these geographic regions.

|                              |  |        |        |      |  |                                 |        |        |  |      |        |       |  |   |        |      |  |   |        |  |  |   |        | 
|----------------------------- |  | ------ | ------ | ---- |  | ------------------------------- | ------ | ------ |  | ---- | ------ | ----- |  | - | ------ | ---- |  | - | ------ |  |  | - | ------ | 
|                              |  |        |        |      |  | Three Months Ended September 30
|                              |  |        |        |      |  |                                
|                              |  |        |        |      |  | 2001                            |        |        |  |      |        |       |  |   |        | 2000
|                              |  |        |        |      |  |                                 |        |        |  |      |        |       |  |   |        |     
|                              |  | Canada |        | U.S. |  | Total                           |        | Canada |  | U.S. |        | Total
|                              |  |        |        |      |  |                                 |        |        |  |      |        |      
|Revenue                       |  | $      | 13,163 |      |  | $                               | 10,845 |        |  | $    | 24,008 |       |  | $ | 12,814 |      |  | $ | 5,715  |  |  | $ | 18,529 | 
|                             
|                             
|                             
|                             
|Depreciation and amortization |  |        | 936    |      |  |                                 | 240    |        |  |      | 1,176  |       |  |   | 1,084  |      |  |   | 120    |  |  |   | 1,204  | 
|                             
|                             
|                             
|                             
|Operating income              |  |        | 644    |      |  |                                 | (149   | )      |  |      | 495    |       |  |   | 236    |      |  |   | 267    |  |  |   | 503    | 
|                             
|                             
|                             
|                             
|Income tax expense            |  |        | 94     |      |  |                                 | 106    |        |  |      | 200    |       |  |   | 85     |      |  |   | 66     |  |  |   | 151    | 
|                             
|                             
|                             
|                             
|Long-lived assets             |  |        | 48,611 |      |  |                                 | 14,356 |        |  |      | 62,967 |       |  |   | 54,563 |      |  |   | 5,676  |  |  |   | 60,239 | 
|                             
|                             
|                             
|                             
|Total assets                  |  |        | 62,730 |      |  |                                 | 27,057 |        |  |      | 89,787 |       |  |   | 69,169 |      |  |   | 15,093 |  |  |   | 84,262 | 

12



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##### 



|                              |  |        |        |      |  |                                |        |        |  |      |        |       |  |   |        |          |  |   |        |  |  |   |        | 
|----------------------------- |  | ------ | ------ | ---- |  | ------------------------------ | ------ | ------ |  | ---- | ------ | ----- |  | - | ------ | -------- |  | - | ------ |  |  | - | ------ | 
|                              |  |        |        |      |  | Nine Months Ended September 30
|                              |  |        |        |      |  |                               
|                              |  |        |        |      |  | 2001                           |        |        |  |      |        |       |  |   |        | 2000 (1)
|                              |  |        |        |      |  |                                |        |        |  |      |        |       |  |   |        |         
|                              |  | Canada |        | U.S. |  | Total                          |        | Canada |  | U.S. |        | Total
|                              |  |        |        |      |  |                                |        |        |  |      |        |      
|Revenue                       |  | $      | 40,322 |      |  | $                              | 24,052 |        |  | $    | 64,374 |       |  | $ | 37,775 |          |  | $ | 13,246 |  |  | $ | 51,021 | 
|                             
|                             
|                             
|                             
|Depreciation and amortization |  |        | 2,789  |      |  |                                | 618    |        |  |      | 3,407  |       |  |   | 3,165  |          |  |   | 300    |  |  |   | 3,465  | 
|                             
|                             
|                             
|                             
|Operating income (loss)       |  |        | 2,793  |      |  |                                | (1,340 | )      |  |      | 1,453  |       |  |   | 713    |          |  |   | 421    |  |  |   | 1,134  | 
|                             
|                             
|                             
|                             
|Income tax expense            |  |        | 1,222  |      |  |                                | (320   | )      |  |      | 902    |       |  |   | 225    |          |  |   | 81     |  |  |   | 306    | 
|                             
|                             
|                             
|                             
|Long-lived assets             |  |        | 48,611 |      |  |                                | 14,356 |        |  |      | 62,967 |       |  |   | 54,563 |          |  |   | 5,676  |  |  |   | 60,239 | 
|                             
|                             
|                             
|                             
|Total assets                  |  |        | 62,730 |      |  |                                | 27,057 |        |  |      | 89,787 |       |  |   | 69,169 |          |  |   | 15,093 |  |  |   | 84,262 | 



---

|(1) |  | pro forma, except asset figures.
|--- |  | --------------------------------



|7. |  | CONTINGENCIES
|-- |  | -------------

Imperial Parking Canada Corporation, a wholly owned subsidiary of the Company,
is a defendant in a lawsuit filed by Sterling Parking Ltd. (Sterling) in
April 2001, in the Queens Bench of Alberta. The suit involves an alleged
breach by Imperial Parking Canada Corporation of a confidentiality agreement
entered into with Sterling in October 2000 relating to the potential management
of certain Sterling lots in Calgary. The proposed transaction with Sterling
was not completed and Sterling claims in the lawsuit that Imperial Parking
Canada Corporation wrongfully bid on certain lots and improperly used Sterling
confidential information, all in breach of the confidentiality agreement. The
total damages claimed by Sterling are approximately $7.3 million (CDN $11.6
million). The Company believes that Sterlings allegations are largely without
merit and that the amount of damages claimed is far in excess of the actual
damages suffered by Sterling, if any. The Company expects that any damages
awarded against Imperial Parking Canada Corporation will not have a material
effect on the Companys financial position or results of operations.



|8. |  | RECENT ACCOUNTING PRONOUNCEMENTS
|-- |  | --------------------------------

During the nine months ended September 30, 2001, the Financial Accounting
Standards Board announced new rules related to the accounting for goodwill.
Financial Accounting Statement No. 14, Business Combinations (SFAS 141)
eliminates the pooling method of accounting for business combinations and is
effective for all transactions initiated after June 30, 2001. The acquisition
described in note 2. has been accounted for using the purchase method in
accordance with SFAS 141.

Financial Accounting Statement No. 142, goodwill and other intangible
assets (SFAS 142) will require that goodwill no longer be amortized, but the
carrying value of goodwill will be subject to a regular impairment test. SFAS
142 is effective for the first fiscal quarter beginning after December 15, 2001
except to the extent that it relates to acquisitions after June 30, 2001. The
effect on the financial statements of the Company is that amortization of
existing goodwill will cease as of December 31, 2001. Goodwill resulting from
the acquisition described in note 2. is not amortized, but is subject to an
impairment test. The Companys goodwill amounts at

13



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December 31, 2001 for acquisitions that occurred prior to July 1, 2001 will be subject to the
impairment test on an ongoing basis commencing with adoption on January 1,
2002.

ITEM 2.

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



| |  | FORWARD-LOOKING STATEMENTS MAY PROVE INACCURATE
| |  | -----------------------------------------------

This report includes various forward-looking statements regarding the
Company that are subject to risks and uncertainties, including, without
limitation, the factors set forth below. Forward-looking statements include,
but are not limited to, discussions regarding the Companys operating strategy,
growth strategy, acquisition strategy, cost
savings initiatives, industry, economic conditions, financial condition,
liquidity and capital resources and results of operations. Such statements
include, but are not limited to, statements preceded by, followed by or that
otherwise include the words believes, expects, anticipates, intends,
estimates or similar expressions. For those statements, the Company claims
the protection of the safe harbor for forward-looking statements contained in
the Private Securities Litigation Reform Act of 1995.

The following important factors, in addition to those discussed elsewhere
in this report, and the documents which are incorporated herein by reference,
could affect the future financial results of the Company and could cause actual
results to differ materially from those expressed in forward-looking statements
contained or incorporated by reference in this document:



| |  | successfully integrating past and future acquisitions in light of
challenges in retaining key employees, synchronizing business processes
and efficiently integrating facilities, marketing, and operations;                                                                                                                                                                          
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| 
| |  | successful implementation of the Companys operating and growth strategy,
including possible strategic acquisitions;                                                                                                                                                                                                                                                                  
| 
| |  | fluctuations in quarterly operating results caused by a variety of
factors including the timing of gains on sales of owned facilities,
pre-opening costs, changes in the Companys cost of borrowing, effect
of weather on travel and transportation patterns, player strikes or
other events affecting major league sports and local, national and
international economic conditions;
| 
| |  | the ability of the Company to form and maintain its strategic
relationships with certain large real estate owners and operators;                                                                                                                                                                                                                                                      
| 
| |  | global and/or regional economic factors;                                                                                                                                                                                                                                                                                                                                              
| 
| |  | compliance with laws and regulations, including, without limitation,
tax, environmental, antitrust and consumer protection laws and
regulations at the federal, state, local and international levels.                                                                                                                                                                                



| |  | OVERVIEW
| |  | --------

On March 27, 2000, Impark completed a series of transactions which
resulted in the combination of the Canadian parking facilities of First Union
and the parking and ancillary services of the FUMI Parking Business. The
following discussion includes a review of the operating results of the combined
businesses for the nine months ended September 30, 2000 on a pro forma basis as
if the combination had been in place on January 1, 2000.

14



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##### 



The Company operates parking facilities under three types of arrangements:
leases, fee ownership and management contracts. Revenues consist of parking
revenues from leased and owned facilities, and revenues earned in accordance
with the terms of management contracts. Direct costs relate typically to leased
and owned facilities and include rent, payroll and related benefits,
maintenance, insurance, and general operating expenses. Direct costs also
include expenses associated with management contracts that are not recoverable
from the property owner.

Revenue earned from each type of arrangement for the quarter and
year-to-date, and the number of facilities operated as at the end of each
quarter, are as follows:

|        |  |                 |       |                    |  |                   |       |      |  |      |        |      |  |         |        |  |  |   |        |  |  |   |        | 
|------- |  | --------------- | ----- | ------------------ |  | ----------------- | ----- | ---- |  | ---- | ------ | ---- |  | ------- | ------ |  |  | - | ------ |  |  | - | ------ | 
|        |  |                 |       |                    |  |                   |       |      |  |      |        |      |  | Revenue
|        |  |                 |       |                    |  |                   |       |      |  |     
|        |  | # of Locations  |       | Three Months Ended |  | Nine Months Ended
|        |  | at September 30 |       | September 30       |  | September 30     
|        |  |                 |       |                    |  |                  
|        |  | 2001            |       | 2000               |  | 2001              |       | 2000 |  | 2001 |        | 2000
|        |  |                 |       |                    |  |                   |       |      |  |      |        |     
|Leased  |  |                 | 553   |                    |  |                   | 503   |      |  | $    | 19,673 |      |  | $       | 15,992 |  |  | $ | 54,950 |  |  | $ | 43,351 | 
|       
|       
|       
|       
|Managed |  |                 | 1,013 |                    |  |                   | 904   |      |  |      | 3,903  |      |  |         | 2,148  |  |  |   | 8,179  |  |  |   | 6,461  | 
|       
|       
|       
|       
|Owned   |  |                 | 15    |                    |  |                   | 15    |      |  |      | 432    |      |  |         | 389    |  |  |   | 1,245  |  |  |   | 1,209  | 
|        |  |                 |       |                    |  |                   |       |      |  |      |        |      |  |         |        |  |  |   |        |  |  |   |        | 
|        |  |                 | 1,581 |                    |  |                   | 1,422 |      |  | $    | 24,008 |      |  | $       | 18,529 |  |  | $ | 64,374 |  |  | $ | 51,021 | 
|        |  |                 |       |                    |  |                   |       |      |  |      |        |      |  |         |        |  |  |   |        |  |  |   |        | 

THREE MONTHS ENDED SEPTEMBER 30, 2001 COMPARED TO THREE MONTHS ENDED SEPTEMBER 30, 2000

Total revenue for the third quarter of fiscal 2001 increased by $5.5 million,
or 29.6%, to $24.0 million from $18.5 million for the third quarter of fiscal
2000. This increase was due largely to an increase in revenue from leased
facilities, and from including the results for DLC Management Group, Inc.
(DLC) which was acquired effective July 1, 2001.

Revenues from leased facilities for the third quarter of fiscal 2001 increased
to $19.7 million from $16.0 million in the third quarter of fiscal 2000, an
increase of $3.7 million, or 23.0%. $3.3 million of this increase was in the
United States and resulted from the acquisition of DLC; opening in Cleveland
(September 2000) and Atlanta (August 2001); and expanding start-up operations
in Cincinnati and Seattle. The acquired DLC facilities contributed $1.1 million
of revenue from leased facilities for the third quarter of fiscal 2001. The
increase in leased revenue in Canada of $0.4 million was due in part to parking
rate increases.

Management contract revenues for the third quarter of fiscal 2001 increased to
$3.9 million from $2.2 million for the third quarter of fiscal 2000, an
increase of $1.7 million, or 81.7%. The increase was solely attributable to
the acquired DLC contracts.

Direct costs in the third quarter of 2001 increased to $18.4 million from $13.8
million in the third quarter of 2000, an increase of $4.6 million, or 33.8%.
The acquisition of DLC accounted for $1.7 million of the increase in direct
costs. In addition, rent expense increased $2.1 million, or 21.4%, from $9.8
million for the third quarter of 2000 to $11.9 million for the third quarter of
2001. Rent as a percentage of revenues, excluding the impact of DLC, increased
to 56.4% in the third quarter of 2001 from 53.0% in the same quarter of 2000.
This increase is due to the leases in our new U.S. operations being in the
early phase of their terms. As we continue to operate these new leased
facilities, we would expect revenue growth to exceed any growth in rent and,
therefore, rent as a percentage of revenue would decline. Increases in other
direct costs of $0.8 million, notably wages, property taxes and utilities at
new leased facilities, account for the remainder of the change in direct costs.
Direct costs as a percentage of revenues increased to 76.9% in the third
quarter of fiscal 2001 from 74.5% in the third quarter of fiscal 2000.

General and administrative expenses increased $0.8 million, or 26.9%, from $3.0
million for the third quarter of fiscal 2000 to $3.8 million for the third
quarter of fiscal 2001. The increase in general and administrative expenses is
due to the acquisition of DLC, which added $0.6 million of general and
administrative expenses, and expansion since last year in the United States,
including $0.1 million for operations in Atlanta and Cleveland. We also
incurred $0.1 million of increased stock compensation expense. General and
administrative expenses, as a

15



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##### 



percentage of total revenues decreased to 16.0 %
for the third quarter of fiscal 2001 compared to 16.3 % for the third quarter
of fiscal 2000.

The equity share in the limited liability company (LLC) losses represents our
50% share in nine LLCs which each operate a parking facility in New York, New
York. The LLCs started operating these facilities in the first nine months of
2001.

Interest income of $0.1 million was earned in the third quarter of fiscal 2001,
a decrease of $0.1 million from the $0.2 million earned in the third quarter of
fiscal 2000. The decrease is due to lower interest rates and lower cash
balances during 2001 compared to 2000.

Interest expense of $0.2 million for the third quarter of fiscal 2001
represents interest on the bank loan to finance the acquisition of DLC and
imputed interest on the portion of the purchase price that is deferred.

Income tax expense for the third quarter of fiscal 2001 includes our current
tax liability for capital and state taxes, and a deferred tax expense as we
utilize our net operating losses for tax purposes in Canada. There was no
corresponding deferred tax expense in the third quarter of fiscal 2000, as we
had not utilized the Canadian tax losses.

Net earnings for the third quarter of 2001 were $0.3 million
 a decrease of
$0.3 million from third quarter earnings in 2000 of $0.6 million. The primary
changes between the third quarter of fiscal 2001 and the third quarter of
fiscal 2000 were a higher gross margin of $0.8 million, offset by higher
general and administrative expenses of $0.8 million and higher net interest
expense of $0.2 million and higher income tax expense of $0.1 million.

NINE MONTHS ENDED SEPTEMBER 30, 2001 COMPARED TO NINE MONTHS ENDED SEPTEMBER 30, 2000

Total revenues for the first nine months of fiscal 2001 increased $13.4
million, or 26.2%, to $64.4 million from $51.0 million for the first nine
months of fiscal 2000. The increase was due largely to an increase in revenue
on leased facilities, and from including the results for DLC which was acquired
effective July 1, 2001.

Revenues from leased facilities for the first nine months of fiscal 2001
increased to $55.0 million from $43.4 million in the first nine months of
fiscal 2000, an increase of $11.6 million or 26.8%. $8.8 million of this
increase was in the United States and resulted from starting operations in San
Francisco (April 2000), Cleveland (September 2000) and Atlanta (August 2001)
and the acquisition of both E-Z Park in Cincinnati (April 2000) and DLC in
Philadelphia (July 2001). The increase of $2.8 million in leased revenue in
Canada included a positive change of $0.5 million related to our dispute over
taxes on parking violation revenue. The first six months of fiscal 2000
included a charge against revenue of $0.3 million based on estimates of our tax
liability at the time. We were ultimately successful in recovering $0.2
million during the first nine months of fiscal 2001 of the amount previously
provided. We do not expect any further benefits in the future from settling
this tax liability. The remainder of the increase in Canada of $2.3 million
was due in part, to parking rate increases and a public transit strike in
Calgary, Alberta and Vancouver, B.C.

Management contract revenues for the first nine months of fiscal 2001 increased
to $8.2 million from $6.5 million for the first nine months of fiscal 2000 an
increase of $1.7 million, or 26.6%. The increase was solely attributable to
the acquired DLC contracts.

Direct costs in the first nine months of 2001 increased to $48.9 million from
$37.8 million in the first nine months of 2000, an increase of $11.1 million or
29.2%. Of this increase, $1.7 million was from DLCs operations; $7.7 million
was attributable to higher rent expense; and $1.7 million to other directs
costs. Rent expense increased $7.7 million, or 29.2% from $26.4 million for
the first nine months of 2000 to $34.1 million for the first nine months of
2001. Rent as a percentage of revenues, increased to 53.0% in the first nine
months of 2001 from 51.7% in the same nine months of 2000. This increase is
principally due to the leases in our new U.S. operations being in the early
phase of their terms. As we continue to operate these new leased facilities,
we would expect revenue growth

16



---



##### 



to exceed any growth in rent and, therefore, rent as a percentage of
revenue would decline. The increase in other direct
costs of $1.7 million, or 14.9%, from $11.4 million to $13.1 million, is due to
the general increase in revenues. Direct costs as a percentage of revenues
increased to 75.9% in the first nine months of fiscal 2001 from 74.1% in the
first nine months of fiscal 2000.

General and administrative expenses increased $1.9 million, or 22.4%, from $8.6
million for the first nine months of fiscal 2000 to $10.5 million for the first
nine months fiscal 2001. The increase in general and administrative expenses
is due to the acquisition of DLC, which added $0.6 million of general and
administrative expenses, and expansion since last year in the United States,
including $0.4 million for operations in San Francisco, Cincinnati, Cleveland,
and Atlanta and $0.3 million to establish a regional management infrastructure
in the United States. We also incurred $0.2 million of additional expense
related to being a public company and $0.4 million of increased stock
compensation expense, as discussed below. General and administrative expenses,
as a percentage of total revenues decreased to 16.3 % for the first nine months
of fiscal 2001 compared to 16.8 % for the first nine months of fiscal 2000.

Included in general and administrative expense is stock-based compensation
expense for the first nine months of fiscal 2001 of $0.5 million which includes
an allocation of both senior managements compensation related to our
stock performance and directors annual stock entitlement for services
rendered. In the first nine months of fiscal 2000 there was $0.1 million of
stock awarded to directors, but no stock compensation expense for senior
management. The allocation for senior managements compensation is based on
the 2000 Stock Incentive Plan which was approved by the stockholders at our
2001 Annual General Meeting. The plan includes variable stock options whereby
the exercise price of the options increases during the term of the options.
Accordingly, any change in the intrinsic value of the options is reflected in
compensation expense on a quarterly basis.

The equity share in the limited liability company (LLC) losses represents our
50% share in nine LLCs which each operate a parking facility in New York, New
York. The LLCs started operating these facilities in the first nine months of
2001.

Interest income of $0.5 million was earned in the first nine months of both
fiscal 2001 and 2000. Although the interest income in 2000 was earned during
only a period of six months from the combination in March 2000, interest
rates in 2000 were higher by approximately 1.5%.

Interest expense of $0.2 million for the third quarter of fiscal 2001
represents interest on the bank loan to finance the acquisition of DLC and
imputed interest on the portion of the purchase price that is deferred.

Income tax expense for the first nine months of fiscal 2001 includes our
current tax liability for capital and state taxes, and a deferred tax expense
as we utilize our net operating losses for tax purposes in Canada. Also
included in the deferred tax expense is a deferred tax recovery for operating
losses in the U.S. for the first nine months of fiscal 2001. The effect of
offsetting losses in the U.S. at lower tax rates against profits in Canada at
higher tax rates is to increase the effective tax rate for accounting purposes
to 51% on a consolidated basis for the first nine months of fiscal 2001. There
was no corresponding deferred tax expense in the first nine months of fiscal
2000, as we had not then recognized the Canadian tax losses for accounting
purposes.

Net earnings for the first nine months of 2001 were
$0.9 million  a decrease
of $0.5 million from the first nine months pro forma earnings in 2000 of $1.4
million. This decrease is primarily due to higher general and administrative
expenses of $1.9 million; equity losses of $0.1 million in the LLCs; lower net
interest income of $0.2 million; and higher income tax expense of $0.6 million;
offset by a higher gross margin of $2.3 million.



| |  | LIQUIDITY AND CAPITAL RESOURCES
| |  | -------------------------------

As at September 30, 2001, we had cash and cash
equivalents of $11.2 million. This represents an
increase of $5.6 million for the first nine months of
fiscal 2001. The increase resulted from $9.7 million
of cash generated from operations and $3.9 million of
funds drawn under our Credit Facility to finance the
acquisition of DLC. These

17



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##### 



cash inflows were offset by $4.6 million used to purchase all of the issued and
outstanding shares of DLC, $2.5 million used in other investing activities,
$0.5 million used to repurchase our stock and $0.4 million of changes in
exchange rates on cash balances. $2.7 million of the cash from operations was
generated by using a letter of credit to replace and release the restricted
cash previously on short-term deposit to support a lien bond issued in
conjunction with negotiating final costs of the San Francisco Giants
development.

We are negotiating final costs with the contractor of the San Francisco
Giants development. We estimate that up to approximately $1.0 million will be
required to complete our share of funding of the development costs. An accrual
has been recorded at September 30, 2001 for the estimated settlement costs.

At September 30, 2001 we had $3.9 million of long-term bank debt
outstanding. After borrowing these funds and using $2.8 million for
outstanding letters of credit, we have $13.3 million remaining of a $20.0
million credit facility with HSBC Bank Canada to fund working capital
requirements, acquisitions and other capital investment opportunities.

In the next 12 months, we anticipate the working capital necessary to
satisfy current obligations will be generated from operations, available cash,
and our bank facility.

In the future, if we identify investment opportunities requiring cash in
excess of operating cash flows and credit facilities, we may seek additional
sources of capital, including the sale or issuance of our common stock or a
rights offering, or amending our credit facility to obtain additional
indebtedness. No assurances can be given that such increases would be
available at the time needed to complete any such transaction.

ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT
MARKET RISK

Interest Rates

Our primary exposure to market risk consists of changes in interest rates
on cash invested in short-term deposits, which as of September 30, 2001 totaled
approximately $2.3 million. Our market risk also consists of changes in
interest rates on variable rate borrowings. As of September 30, 2001, we had
$3.9 million of variable rate debt outstanding under the Credit Facility priced
at LIBOR plus 162.5 basis points. Changes in interest rates could impact our
anticipated interest income or expense.

Foreign Currency Exposure

We operate wholly owned subsidiaries in Canada. Total revenues from
Canadian operations amounted to $13.2 million and $12.8 million for the three
months ended September 30, 2001 and 2000, respectively and $40.3 million and
$37.8 million (pro forma) for the nine months ended September 30, 2001 and
2000, respectively. We intend to continue to invest in Canadian leased or
owned facilities, and may identify expansion opportunities in other foreign
countries. Our exposure to foreign currency fluctuations is limited as the
Canadian dollar revenues to date have been significantly offset by Canadian
dollar operating costs. In limited circumstances we have denominated Canadian
contracts in U.S. dollars to limit currency exposure. Presently, we have no
formal hedging programs and have no outstanding derivative contracts. We
anticipate implementing a hedging program if such risk materially increases.

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PART II  OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

LITIGATION

The provision of services to the public entails an inherent risk of
liability. We are engaged from time to time in routine litigation incidental
to our business. Other than cases involving Eau Claire Market and Sterling
Parking Ltd. in Calgary, Alberta and with The Weitz Company and Weitz Golf
Construction, Inc. in San Francisco, California described below, there is no
legal proceeding to which we are a party which, if decided adversely could
materially harm our financial condition. We attempt to disclaim liability for
personal injury in facilities we operate. We also carry liability insurance
that we believe meets or exceeds industry standards as determined by our
landlords. We can provide no assurances, however, that any future legal
proceedings (including any related judgements, settlements or costs) will not
have a material adverse effect on our financial condition, liquidity or results
of operations.

The Eau Claire Market litigation was filed in the Queens Bench of Alberta
on August 20, 1998. It involves a claim against a property in which we are the
lessee. The plaintiff asserts that it is entitled to priority over our lease
and to possession of the property. We believe that this claim is without
merit. If, however, we do not prevail in the litigation, we may be forced to
renegotiate the lease with the landlord, in which case the rent could be
substantially increased and may materially impact our results.

Imperial Parking Canada Corporation (Impark Canada), a subsidiary of
Impark, is a defendant in a lawsuit brought by Newcourt Financial Ltd.
(Newcourt) as the assignee of Oracle Corporation Canada Inc. (Oracle). The
suit was filed in Ontario Superior Court on June 11, 1999. It alleges that
Impark Canada and FUMI owe approximately $825,000 under a software licence and
services agreement. We believe the claim is without merit. In response to the
claim, Impark Canada and FUMI have commenced their own action in British
Columbia, seeking a declaration that no amounts are owing to either Newcourt or
Oracle under the license and services agreement. The Ontario lawsuit has been
stayed pending the resolution of the B.C. action. First Union has agreed in
writing to assume all liability with respect to this claim.

Impark Canada is a defendant in a lawsuit brought by Sterling Parking
Ltd., which was filed April 3, 2001 in the Queens Bench of Alberta. The suit
involves an alleged breach by Impark Canada of a confidentiality agreement
entered into with Sterling in October 2000 relating to the potential management
by Impark Canada of certain Sterling lots in Calgary. The agreement prohibited
Impark Canada from bidding on any Sterling lots while negotiations of such
transaction were underway. During negotiations, Impark Canada successfully bid
on two Sterling lots. The proposed transaction with Sterling was not
completed. Sterling claims in the lawsuit that Impark Canada wrongfully bid on
the two lots and an additional three lots, as well as improperly used Sterling
confidential information, all in breach of the confidentiality agreement. The
total damages claimed by Sterling are approximately $7.3 million (Cdn$11.6
million). We believe that Sterlings allegations are largely without merit and
that the amount of damages claimed is far in excess of the actual damages
suffered by Sterling, if any. We believe that any damages awarded against
Impark Canada will not have a material effect on our results.

On September 26, 2000, a lawsuit was filed by Ghilotti Brothers
Construction Inc. (Ghilotti) in the Superior Court of California against
Imperial Parking (U.S.), Inc. (a subsidiary of Impark and herein Impark
U.S.), Weitz Golf Construction Inc. and the surety (the Ghilotti Lawsuit).
The lawsuit alleges that Ghilotti incurred cost overruns of approximately
$610,000.00 relating to the construction of the Pacific Bell Park parking lots
in San Francisco in the winter and spring of 2000. On August 2, 2001, a
separate and related lawsuit was filed in the Superior Court of California by
Weitz Golf Construction, Inc. and The Weitz Company (collectively Weitz)
against Impark U.S. and the surety (the Weitz Lawsuit). Weitz and Impark
U.S. had entered into contracts in November 1998 relating to the demolition and
construction of the Pacific Bell Park parking lots. Weitz was the general
contractor and Ghilotti was a subcontractor. Weitz alleges that it incurred
cost overruns related to both the demolition and construction, and that it also
suffered damages from the release of certain mechanics liens that it had filed
against the parking lots. Weitz claims damages in the aggregate of $3.16
million, which amount

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includes the amounts claimed by Ghilotti against Weitz and Impark U.S. in
the Ghilotti Lawsuit. Both the Weitz Lawsuit and the Ghilotti Lawsuit have
been stayed, pending final and binding arbitration involving all parties. We
are negotiating a settlement with all parties and believe that our potential
liability is significantly less than alleged by Weitz or Ghilotti. Further, we
sublease the parking lots from the China Basin Ballpark Company LLC (CBBC),
pursuant to which CBBC is required to share in any cost overruns. We
anticipate that a substantial amount of any actual cost overruns for which we
are liable will be reimbursed to Impark U.S. by CBBC.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY-HOLDERS

There were no matters submitted to a vote of security holders during the
quarter ended September 30, 2001.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K



| | (a) |  | List of Exhibits                                                                                                                                                                                                                                                                       
| | --- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |     |  | Each exhibit listed below in the Index to Exhibits is filed as a part of
this report. Exhibits not incorporated by reference to a prior filing are
designated by an asterisk (*); all exhibits not so designated are
incorporated herein by reference to a prior filing as indicated.
|
| |     |  | Index to Exhibits                                                                                                                                                                                                                                                                      

|            |  |                                                                                                                                                                                                                                                                                                   
|----------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Description                                                                                                                                                                                                                                                                                       
|           
|2.1         |  | Memorandum of Understanding regarding the Distribution between
First Union Real Estate Equity and Mortgage Investments (First
Union) and the Registrant (Incorporated by reference to Exhibit 2.1
to the Companys Registration Statement No. 001-15629 on Form 10/A as
filed on March 2, 2000).
|           
|3.1         |  | Amended and Restated Certificate of Incorporation of the
Registrant (Incorporated by reference to Exhibit 3.1 to the Companys
Registration Statement No. 001-15629 on Form 10/A as filed on March
2, 2000).                                                                                      
|           
|3.2         |  | Amended and Restated By-Laws of the Registrant (Incorporated by
reference to Exhibit 3.2 to the Companys Registration Statement No.
001-15629 on Form 10/A as filed on March 2, 2000).                                                                                                           
|           
|4.1         |  | Specimen certificate for shares of common stock of the
Registrant (Incorporated by reference to Exhibit 4.1 to the Companys
Registration Statement No. 001-15629 on Form 10/A as filed on March
2, 2000).                                                                                        
|           
|10.1        |  | 2000 Stock Incentive Plan of the Registrant (Incorporated by
reference to Exhibit 10.1 to the Companys Registration Statement No.
001-15629 on Form 10/A as filed on March 2, 2000).                                                                                                             
|           
|10.4        |  | Indemnification Agreement (Incorporated by reference to Exhibit
10.4 to the Companys Registration Statement No. 001-15629 on Form
10/A as filed on March 2, 2000).                                                                                                                               
|           
|10.6        |  | Huntzinger Employment Agreement (Incorporated by reference to
Exhibit 10.6 to the Companys Registration Statement No. 001-15629 on
Form 10/A as filed on March 21, 2000).                                                                                                                        
|           
|10.7        |  | Wallner Employment Agreement (Incorporated by reference to
Exhibit 10.7 to the Companys Registration Statement No. 001-15629 on
Form 10/A as filed on March 21, 2000).                                                                                                                           

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|            |  |                                                                                                                                                                       
|----------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Description                                                                                                                                                           
|           
|10.8        |  | Newsome Employment Agreement (Incorporated by reference to
Exhibit 10.8 to the Companys Registration Statement No. 001-15629 on
Form 10/A as filed on March 2, 2000).
|           
|10.10       |  | $20.0 million Credit Facility (Incorporated by reference to
Exhibit 10.10 to the Companys Annual Report on Form 10K as filed on
March 28, 2001).                     
|           
|10.11*      |  | Restricted Stock Agreement for Annual Stock Grant to Directors.                                                                                                       
|           
|21.1*       |  | Subsidiaries of the Registrant.                                                                                                                                       



| | (b) |  | Reports on Form 8-K                                                                                         
| | --- |  | ------------------------------------------------------------------------------------------------------------
|
| |     |  | The Company filed the following reports on Form 8-K during the quarter
ended September 30, 2001:            
|
| |     |  | July 12, 2001  Item 2. Acquisition or Disposition of Assets 
Acquisition of DLC Management     Group. Inc.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

|                        |  |                                                                            
|----------------------- |  | ---------------------------------------------------------------------------
|                        |  | IMPERIAL PARKING CORPORATION                                               
|                        |  |                                                                            
|Date:  November 8, 2001 |  | By: /s/ J. Bruce Newsome                                                   
|                        |  |                                                                            
|_______________________ |  | _________________________________.
J. Bruce Newsome
Chief Financial Officer

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