SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                    FORM 10-Q
                    QUARTERLY REPORT UNDER SECTION 13 OR 15(D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                FOR THE QUARTERLY PERIOD ENDED DECEMBER 31, 2001
                                       or
                   TRANSITION REPORT UNDER SECTION 13 OR 15(D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                           Commission file No. 0-12641



                                                [GRAPHIC OMITED]


                        IMAGING TECHNOLOGIES CORPORATION
             (Exact name of registrant as specified in its charter)

                             DELAWARE     33-0021693
(State or other jurisdiction of incorporation or organization)     (IRS Employer
                                     ID No.)
                             15175 INNOVATION DRIVE
                           SAN DIEGO, CALIFORNIA 92128
                    (Address of principal executive offices)
       Registrant's Telephone Number, Including Area Code:  (858) 613-1300


Check  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 past 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    No

The number of shares outstanding of the registrant's common stock as of February
12,  2002  was  262,546,959.

<PAGE>
<TABLE>
<CAPTION>

TABLE  OF  CONTENTS


<S>                                                                                                   <C>
                                                                                                      Page
PART I - FINANCIAL INFORMATION
ITEM 1.  CONSOLIDATED FINANCIAL STATEMENTS
     Consolidated Balance Sheets - December 31, 2001 (unaudited) and June 30, 2001 (audited)      ..     3
     Consolidated Statements of Operations  - 3 months ended December 31, 2001 and 2000 (unaudited).     4
     Consolidated Statements of Operations  - 6 months ended December 31, 2001 and 2000 (unaudited).     5
     Consolidated Statements of Cash Flows - 6 months ended December 31, 2001 and 2000 (unaudited) .     6
     Notes to Consolidated Financial Statements                         .. . . . . . . . . . . . . .     7

ITEM 2.  Management's Discussion and Analysis of Financial Condition and Results of Operations . . .    11

ITEM 3.  Quantitative and Qualitative Disclosures About Market Risk. . . . . . . . . . . . . . . . .    20

PART II - OTHER INFORMATION

ITEM 1.  Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    21

ITEM 2.  Changes in Securities and Use of Proceeds                .. . . . . . . . . . . . . . . . .    21

ITEM 3.  Defaults Upon Senior Securities                           . . . . . . . . . . . . . . . . .    21

ITEM 4.  Submission of Matters to a Vote of Security Holders          .. . . . . . . . . . . . . . .    21

ITEM 5.  Other Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    21

ITEM 6.  Exhibits and Reports on Form 8-K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    22

SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    23


</TABLE>

<PAGE>

PART  I.  -  FINANCIAL  INFORMATION

ITEM  1.   CONSOLIDATED  FINANCIAL  STATEMENTS

<TABLE>
<CAPTION>

IMAGING  TECHNOLOGIES  CORPORATION  AND  SUBSIDIARIES
                                 CONSOLIDATED BALANCE SHEETS
                              (IN THOUSANDS, EXCEPT SHARE DATA)


<S>                                                             <C>             <C>
ASSETS
                                                                DECEMBER 31,    JUNE 30,
                                                                         2001           2001
    (audited)
Current assets
     Cash. . . . . . . . . . . . . . . . . . . . . . . . . . .  $         159   $         35
     Accounts receivable:
        Billed . . . . . . . . . . . . . . . . . . . . . . . .            954             58
        Unbilled . . . . . . . . . . . . . . . . . . . . . . .            634              -
                                                                --------------  -------------
                                                                        1,747             58

     Inventories . . . . . . . . . . . . . . . . . . . . . . .            877             50
     Prepaid expenses and other. . . . . . . . . . . . . . . .            311            259
                                                                --------------  -------------
          Total current assets . . . . . . . . . . . . . . . .          2,935            402

Property and equipment, net. . . . . . . . . . . . . . . . . .            206            241
Goodwill, net. . . . . . . . . . . . . . . . . . . . . . . . .          1,823            569
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . . .            197              -
                                                                --------------  -------------

                                                                $       5,161   $      1,212
                                                                ==============  =============

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
     Borrowings under bank note payable. . . . . . . . . . . .  $       3,818   $      4,318
     Short-term debt . . . . . . . . . . . . . . . . . . . . .          6,001          3,379
     Accounts payable. . . . . . . . . . . . . . . . . . . . .          6,325          6,450
     PEO payroll taxes and other payroll deductions. . . . . .            443              -
     PEO accrued worksite employee . . . . . . . . . . . . . .            550              -
     Other accrued expenses. . . . . . . . . . . . . . . . . .          5,497          3,175
                                                                --------------  -------------
          Total current liabilities. . . . . . . . . . . . . .         22,634         17,322

Stockholders' net capital deficiency
     Series A preferred stock, $1,000 par value, 7,500 shares
        authorized, 420.5 shares issued and outstanding. . . .            420            420
     Common stock, $0.005 par value, 500,000,000 shares
        authorized, 226,555,800 and 170,901,065 shares issued
        and outstanding, respectively. . . . . . . . . . . . .          1,133            864
     Paid-in capital . . . . . . . . . . . . . . . . . . . . .         71,642         69,472
     Shareholder loans . . . . . . . . . . . . . . . . . . . .           (105)          (105)
     Common stock warrants . . . . . . . . . . . . . . . . . .            541            475
     Accumulated deficit . . . . . . . . . . . . . . . . . . .        (91,104)       (87,236)
                                                                --------------  -------------
          Total shareholders' net capital deficiency . . . . .        (17,473)       (16,110)
                                                                --------------  -------------
                                                                $       5,161   $      1,212
                                                                ==============  =============

See Notes to Consolidated Financial Statements.
</TABLE>

<PAGE>
                IMAGING TECHNOLOGIES CORPORATION AND SUBSIDIARIES

<TABLE>
<CAPTION>

CONSOLIDATED  STATEMENTS  OF  OPERATIONS
THREE  MONTHS  ENDED  DECEMBER  31,  2001  AND  2000
(IN  THOUSANDS,  EXCEPT  SHARE  DATA)
(UNAUDITED)


<S>                                                   <C>             <C>
                                                               2001           2000
Revenues
     Sales of products . . . . . . . . . . . . . . .  $         891   $        556
    Software sales, licenses and royalties . . . . .            145            455
     PEO services. . . . . . . . . . . . . . . . . .          7,074              -
                                                      --------------  -------------
                                                              8,110          1,011
                                                      --------------  -------------
Costs and expenses
     Cost of products sold . . . . . . . . . . . . .            646            481
     Cost of software sales, licenses and royalties.             24              -
     Cost of PEO services. . . . . . . . . . . . . .          6,795              -
     Selling, general, and administrative. . . . . .          2,137          1,721
     Research and development. . . . . . . . . . . .             64            217
                                                      --------------  -------------
                                                              9,666          2,419
                                                      --------------  -------------

Income (loss) from operations. . . . . . . . . . . .         (1,556)        (1,408)
                                                      --------------  -------------

Other income (expense):
     Interest and financing costs, net . . . . . . .           (298)          (177)
     Other . . . . . . . . . . . . . . . . . . . . .              -              -
                                                      --------------  -------------
                                                               (298)          (177)
                                                      --------------  -------------

Income (loss) before income taxes. . . . . . . . . .         (1,854)        (1,585)
Income tax expense

Net income (loss). . . . . . . . . . . . . . . . . .  $      (1,854)  $     (1,585)
                                                      ==============  =============

Earnings (loss) per common share
     Basic . . . . . . . . . . . . . . . . . . . . .  $       (0.01)  $      (0.01)
                                                      ==============  =============
     Diluted . . . . . . . . . . . . . . . . . . . .  $       (0.01)  $      (0.01)
                                                      ==============  =============

Weighted average common shares . . . . . . . . . . .        199,037        112,709
                                                      ==============  =============
Weighted average common shares - assuming dilution .        199,037        112,709
                                                      ==============  =============

See Notes to Consolidated Financial Statements.
</TABLE>

<PAGE>
                IMAGING TECHNOLOGIES CORPORATION AND SUBSIDIARIES

<TABLE>
<CAPTION>

CONSOLIDATED  STATEMENTS  OF  OPERATIONS
SIX  MONTHS  ENDED  DECEMBER  31,  2001  AND  2000
(IN  THOUSANDS,  EXCEPT  SHARE  DATA)
(UNAUDITED)


<S>                                                  <C>            <C>
                                                             2001           2000
Revenues
     Sales of imaging products. . . . . . . . . . .  $      1,764   $      1,216
     Sales of software, licenses and royalties. . .           350            632
     PEO services . . . . . . . . . . . . . . . . .         7,074              -
                                                     -------------  -------------
                                                            9,188          1,848
                                                     -------------  -------------
Costs and expenses
     Cost of products sold. . . . . . . . . . . . .         1,214            924
     Cost of software, licenses and royalties . . .            54              -
     Cost of PEO services . . . . . . . . . . . . .         6,795              -
     Selling, general, and administrative . . . . .         3,586          4,072
     Research and development . . . . . . . . . . .           136            456
                                                     -------------  -------------
                                                           11,785          5,452
                                                     -------------  -------------

Income (loss) from operations . . . . . . . . . . .        (2,597)        (3,604)
                                                     -------------  -------------

Other income (expense):
      Interest and financing costs, net . . . . . .        (1,018)          (358)
     Other. . . . . . . . . . . . . . . . . . . . .             -              -
                                                     -------------  -------------
                                                           (1,018)          (358)
                                                     -------------  -------------

Income (loss) before income taxes . . . . . . . . .        (3,615)        (3,962)
Income tax expense

Net income (loss) . . . . . . . . . . . . . . . . .  $     (3,615)  $     (3,962)
                                                     =============  =============

Earnings (loss) per common share
     Basic. . . . . . . . . . . . . . . . . . . . .  $      (0.02)  $      (0.04)
                                                     =============  =============
     Diluted. . . . . . . . . . . . . . . . . . . .  $      (0.02)  $      (0.04)
                                                     =============  =============

Weighted average common shares. . . . . . . . . . .       185,010        107,997
                                                     =============  =============
Weighted average common shares - assuming dilution.       185,010        107,997
                                                     =============  =============

See Notes to Consolidated Financial Statements.
</TABLE>

<PAGE>
                IMAGING TECHNOLOGIES CORPORATION AND SUBSIDIARIES

<TABLE>
<CAPTION>

CONSOLIDATED  STATEMENTS  OF  CASH  FLOWS
SIX  MONTHS  ENDED  DECEMBER  31,  2001  AND  2000
(IN  THOUSANDS,  EXCEPT  SHARE  DATA)
(UNAUDITED)


<S>                                                         <C>                 <C>
                                                                         2001                2000
Cash flows from operating activities
   Net income (loss) . . . . . . . . . . . . . . . . . . .  $          (3,615)  $          (3,962)
   Adjustments to reconcile net income (loss) to net
     cash from operating activities
        Depreciation and amortization. . . . . . . . . . .                 51                 143
         Stock issued for services . . . . . . . . . . . .                367                 618
        Changes in operating assets and liabilities
           Accounts receivable . . . . . . . . . . . . . .             (1,418)               (355)
           Inventories . . . . . . . . . . . . . . . . . .               (827)                 45
           Prepaid expenses and other. . . . . . . . . . .                (44)                (37)
           Accounts payable and accrued expenses . . . . .              1,961                 767
           PEO payroll taxes and other payroll deductions.                106                   -
           PEO accrued worksite employee expense . . . . .                318                   -
           Other assets. . . . . . . . . . . . . . . . . .                  2                   -
                                                            ------------------  ------------------
               Net cash from operating activities. . . . .             (3,099)             (2,781)

Cash flows from investing activities
   Capital expenditures. . . . . . . . . . . . . . . . . .                (56)                (90)
   Cash investment in acquisitions . . . . . . . . . . . .               (250)                  -
   Other . . . . . . . . . . . . . . . . . . . . . . . . .                  -                 150
                                                            ------------------  ------------------
               Net cash from investing activities. . . . .                (91)                 60
                                                            ------------------  ------------------

Cash flows from financing activities
   Net borrowings under bank lines of credit . . . . . . .               (500)               (900)
   Issuance of other notes payable . . . . . . . . . . . .              1,922                 850
   Warrant proceeds. . . . . . . . . . . . . . . . . . . .                 66                   -
   Net proceeds from issuance of common stock. . . . . . .              1,826               2,877
                                                            ------------------  ------------------
               Net cash from financing activities. . . . .              3,314               2,827
                                                            ------------------  ------------------

Net increase (decrease) in cash. . . . . . . . . . . . . .                124                 106
Cash, beginning of period. . . . . . . . . . . . . . . . .                 35                 291
                                                            ------------------  ------------------
Cash, end of period. . . . . . . . . . . . . . . . . . . .  $             159   $             397
                                                            ==================  ==================


See Notes to Consolidated Financial Statements.
</TABLE>



<PAGE>
                MAGING TECHNOLOGIES CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        (IN THOUSANDS, EXCEPT SHARE DATA)
                                   (UNAUDITED)
NOTE  1.  BASIS  OF  PRESENTATION
The  accompanying  unaudited  consolidated  condensed  financial  statements  of
Imaging Technologies Corporation and Subsidiaries (the "Company" or "ITEC") have
been  prepared  pursuant  to the rules of the Securities and Exchange Commission
(the  "SEC")  for  quarterly  reports on Form 10-Q and do not include all of the
information  and  note  disclosures  required  by  generally accepted accounting
principles.  These  financial  statements and notes herein are unaudited, but in
the  opinion  of  management,  include  all  the adjustments (consisting only of
normal recurring adjustments) necessary for a fair presentation of the Company's
financial  position,  results  of  operations,  and  cash  flows for the periods
presented.  These  financial  statements  should be read in conjunction with the
Company's  audited  financial  statements  and notes thereto for the years ended
June  30,  2001,  2000, and 1999 included in the Company's annual report on Form
10-K  filed  with  the  SEC.  Interim  operating  results  are  not  necessarily
indicative  of  operating  results for any future interim period or for the full
year.
NOTE  2.  GOING  CONCERN  CONSIDERATIONS
The  accompanying  financial  statements  have  been  prepared assuming that the
Company will continue as a going concern. At December 31, 2001, and for the year
then  ended,  the  Company  has  experienced  a net loss and has deficiencies in
working  capital and net worth that raise substantial doubt about its ability to
continue  as  a  going  concern.
On  August  20,  1999,  at  the  request of Imperial Bank, the Company's primary
lender,  the  Superior  Court of San Diego appointed an operational receiver who
took  control of the Company's day-to-day operations on August 23, 1999. On June
21,  2000, in connection with a settlement agreement reached with Imperial Bank,
the  Superior  Court  of  San  Diego  issued an order dismissing the operational
receiver.
On October 21, 1999, Nasdaq notified the Company that it no longer complied with
the  bid  price  and  net  tangible  assets/market  capitalization/net  income
requirements  for  continued listing on The Nasdaq SmallCap Market. At a hearing
on  December  2,  1999, a Nasdaq Listing Qualifications Panel also raised public
interest  concerns  relating to the Company's financial viability. The Company's
common  stock was delisted from The Nasdaq Stock Market effective with the close
of  business  on  March  1,  2000. As a result of being delisted from The Nasdaq
SmallCap  Market,  stockholders may find it more difficult to sell common stock.
This  lack  of liquidity also may make it more difficult to raise capital in the
future.  Trading  of  the  Company's  common  stock  is  now  being  conducted
over-the-counter  through the NASD Electronic Bulletin Board and covered by Rule
15g-9 under the Securities Exchange Act of 1934. Under this rule, broker/dealers
who  recommend  these securities to persons other than established customers and
accredited  investors  must make a special written suitability determination for
the  purchaser  and  receive  the purchaser's written agreement to a transaction
prior  to  sale.  Securities are exempt from this rule if the market price is at
least  $5.00  per  share.
The Securities and Exchange Commission adopted regulations that generally define
a  "penny  stock"  as  any  equity security that has a market price of less than
$5.00  per  share.  Additionally,  if  the  equity security is not registered or
authorized  on  a  national securities exchange or the Nasdaq and the issuer has
net  tangible assets under $2,000,000, the equity security also would constitute
a  "penny  stock."  Our  common  stock does constitute a penny stock because our
common  stock  has a market price less than $5.00 per share, our common stock is
no longer quoted on Nasdaq and our net tangible assets do not exceed $2,000,000.
As  our  common  stock  falls  within  the  definition  of  penny  stock,  these
regulations  require the delivery, prior to any transaction involving our common
stock,  of a disclosure schedule explaining the penny stock market and the risks
associated  with  it.  Furthermore,  the  ability  of broker/dealers to sell our
common  stock  and  the  ability of shareholders to sell our common stock in the
secondary  market  would  be  limited. As a result, the market liquidity for our
common  stock  would  be  severely  and  adversely  affected.  We can provide no
assurance that trading in our common stock will not be subject to these or other
regulations  in  the  future,  which  would negatively affect the market for our
common  stock.
The Company must obtain additional funds to provide adequate working capital and
finance  operations. However, there can be no assurance that the Company will be
able  to complete any additional debt or equity financings on favorable terms or
at  all, or that any such financings, if completed, will be adequate to meet the
Company's  capital  requirements  including  compliance  with  the Imperial Bank
settlement agreement. Any additional equity or convertible debt financings could
result  in substantial dilution to the Company's stockholders. If adequate funds
are  not  available,  the  Company may be required to delay, reduce or eliminate
some  or  all  of  its  planned  activities,  including any potential mergers or
acquisitions.  The  Company's  inability  to fund its capital requirements would
have  a  material adverse effect on the Company. The financial statements do not
include  any adjustments that might result from the outcome of this uncertainty.
NOTE  3.  EARNINGS  (LOSS)  PER  COMMON  SHARE
Basic  earnings  (loss)  per common share ("Basic EPS") excludes dilution and is
computed  by  dividing  net  income (loss) available to common shareholders (the
"numerator")  by  the  weighted average number of common shares outstanding (the
"denominator")  during  the  period.  Diluted  earnings  (loss) per common share
("Diluted  EPS")  is  similar  to  the  computation of Basic EPS except that the
denominator  is increased to include the number of additional common shares that
would  have  been  outstanding  if the dilutive potential common shares had been
issued. In addition, in computing the dilutive effect of convertible securities,
the  numerator  is  adjusted  to  add  back  the  after-tax  amount  of interest
recognized  in  the period associated with any convertible debt. The computation
of  Diluted  EPS does not assume exercise or conversion of securities that would
have  an anti-dilutive effect on net earnings (loss) per share. The following is
a  reconciliation  of  Basic  EPS  to  Diluted  EPS:

<TABLE>
<CAPTION>



                               EARNINGS (LOSS)      SHARES       PER-SHARE
<S>                            <C>               <C>            <C>
                                    (NUMERATOR)  (DENOMINATOR)  AMOUNT
DECEMBER 31, 2000
     Net loss . . . . . . . .  $        (1,585)
          Preferred dividends               (6)
                               ----------------
     Basic and diluted EPS. .           (1,591)        112,709  $    (0.01)

DECEMBER 31, 2001
     Net loss . . . . . . . .  $       ( 1,697)
          Preferred dividends               (6)
                               ----------------
     Basic and diluted EPS. .           (1,703)        199,037  $    (0.01)
</TABLE>


NOTE  4.  INVENTORIES

<TABLE>
<CAPTION>



<S>                           <C>                <C>
                              DEC. 31, 2001      SEPT. 30, 2001
Inventories
     Materials and suppliers  $              25  $             10
     Finished goods. . . . .                852               130
                              -----------------  ----------------
                              $             877  $            140
                              =================  ================
</TABLE>


NOTE  5.  CONVERTIBLE  NOTES  PAYABLE
     In  December  2000,  the  Company  entered into a Convertible Note Purchase
Agreement  for  $850,000, bearing an annual interest a of 8%, due December 2003.
The  Note  is  convertible  into  the  Company's  common  stock.
     In  July  2001,  the  Company  entered  into  a  Convertible  Note Purchase
Agreement  for $1,000,000, bearing an annual interest rate of 8%, due July 2004.
The  Note  is  convertible  into  the  Company's  common  stock.
     In  September  2001, the Company entered into a Convertible Promissory Note
for  $300,000,  bearing  an interest rate of 8%, due September 2004. The Note is
convertible  into  the  Company's  common  stock.
     In  November  2001,  the Company entered into a Convertible Promissory Note
for  $200,000,  bearing  an  interest rate of 8%, due November 2004. The Note is
convertible  into  the  Company's  common  stock.
     In  January  2002, the Company entered into a Secured Convertible Debenture
for  $500,000, bearing an interest rate of 8%. The Debenture is convertible into
the  Company's  common  stock.

NOTE  6.  STOCK  ISSUANCES
     During  the  quarter,  ITEC  issued  27,236,338 common shares to holders of
convertible  notes  payable at an average conversion price of  $0.018 per share.
     ITEC issued during the quarter 9,898,666 registered common shares for legal
and  consulting  at  a  warrant  conversion  average  price  of  $0.03 per share
pursuant  to  previously  registrations  under  Form S-8. The Company recognized
$294,491  in  expenses  as  a  result  of  the  conversions.
     Registered  warrants,  exercised  during the quarter at an average price of
$0.023  per  share,  amounted  to  5,667,277 common shares. The Company received
$131,575  in  cash.

NOTE  7.  BUSINESS  ACQUISITIONS
     On  October  25,  2001,  the Company acquired certain assets. These assets,
related  to  the  Company's  office  products  and services business activities,
represent  an  aggregate  of $260,000 and include inventories, fixed assets, and
accounts  receivable.  The  purchase price of the assets was 7,500,000 shares of
ITEC  common  stock,  determined by the market price of ITEC common stock at the
date  of  acquisition.  The  Company  has  agreed  to  register  these  shares.
     On November 12, 2001, the Company acquired all of the outstanding shares of
SourceOne,  Inc.  ("SourceOne")  from  Neotactix,  Inc.  for $750,000. ITEC paid
$250,000  in  cash  at Closing. $200,000 of these funds were provided by outside
investors  in  the  form  of  a  promissory note convertible into shares of ITEC
common stock, the number of which will be determined by a formula applied to the
market  price  of  the shares at the time that the promissory note is converted.
The  balance  is  payable  in  cash  or  stock  on  a quarterly payment schedule
beginning  in  April  2002.
     The  purchase  price was determined through analysis of SourceOne's recent,
unaudited  financial  performance.  SourceOne,  through  September 30, 2001, had
losses  of  approximately $220 thousand on 6-month revenues of approximately $25
million.  The  total  purchase  price  was  arrived at through negotiations. The
assets of SourceOne consist of cash, accounts receivable, and pre-paid insurance
premiums.
     SourceOne  is  a  professional  employer organization ("PEO") that provides
comprehensive  personnel  management  services,  including  benefits and payroll
administration,  health  and workers' compensation insurance programs, personnel
records  management,  and  employer  liability  management.
     The Company disclosed the details of the SourceOne transaction on Form 8-K,
dated  January  25,  2002.
     SourceOne Group, Inc. is operated by ITEC as a wholly-owned subsidiary. The
consolidated  financial  statements  of  ITEC include the financial condition of
SourceOne  Group  as  of December 31, 2001 and the Statement of Operations since
November 12, 2001. The pro forma presentation below displays pro forma condensed
statement of operations as if SourceOne Group had been part of the Company since
July  1, 2001- the beginning of the fiscal year. A comparison to the same period
last  year  is  not presented as SourceOne Group began operations in April 2001.

<TABLE>
<CAPTION>



<S>                                               <C>                       <C>
(in thousands) . . . . . . . . . . . . . . . . .  AS OF DECEMBER 31, 2001
  3-MONTHS . . . . . . . . . . . . . . . . . . .                 6 MONTHS
------------------------------------------------  ------------------------
Revenues:
   Sales of imaging products . . . . . . . . . .                      891    1,764
   Software sales, royalties & licenses. . . . .                      145      350
   PEO services. . . . . . . . . . . . . . . . .                   12,032   25,485
                                                  ------------------------  -------
                                                                   13,068   27,599
Costs and expenses:
   Cost of imaging products sold . . . . . . . .                      646    1,214
   Cost of software sales, royalties & licenses.                       24       54
   Cost of PEO services. . . . . . . . . . . . .                   11,744   24,900
   Selling, general and administrative . . . . .                    2,285    4,142
   Research and development. . . . . . . . . . .                       64      136
                                                  ------------------------  -------
                                                                   14,763   30,446

Loss from operations . . . . . . . . . . . . . .                   (1,695)  (2,847)

Other income (expense):
   Interest and finance costs,net. . . . . . . .                     (298)  (1,018)
                                                  ------------------------  -------

Loss before income taxes . . . . . . . . . . . .                   (1,993)  (3,865)

Income tax benefit (expense) . . . . . . . . . .                        -        -
                                                  ------------------------  -------

Net loss . . . . . . . . . . . . . . . . . . . .                   (1,993)  (3,865)
                                                  ========================  =======
</TABLE>



NOTE  8.  SEGMENT  INFORMATION
     During  the  three-month  and six-month period ended December 31, 2001, the
Company  managed  and  internally  reported  the  Company's  business  as  three
reportable  segments,  principally,  (1)  imaging  products and accessories, (2)
imaging  software,  and  (3)  PEO  services.
     Segment  information  for the period ended December 31, 2001 is as follows:

<TABLE>
<CAPTION>



<S>                          <C>         <C>                <C>
(in thousands)

                             IMAGING
                             PRODUCTS    IMAGING SOFTWARE   PEO SERVICES
                                         -----------------  -------------
3-months
---------------------------
    Revenues. . . . . . . .  $     891   $             145  $       7,074
    Operating income (loss)     (1,816)                 97            163

6-months
---------------------------
    Revenues. . . . . . . .  $   1,764   $             350  $       7,074
    Operating income (loss)     (2,996)                236            163
</TABLE>


     Additional  information regarding revenue by products and service groups is
not  presented  because  it  is  currently impracticable to do so due to various
reorganizations  of the Company's accounting systems. A comprehensive accounting
system  is  being  implemented  that  should  enable  the Company to report such
information  in  the  future.
     During  the  period ended December 31, 2001, no customer accounted for more
than  10%  of  consolidated  accounts receivable or total consolidated revenues.

ITEM  2.  MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OF  FINANCIAL  CONDITION
AND  RESULTS  OF  OPERATIONS

     The  following  discussion  and analysis should be read in conjunction with
the  consolidated  financial statements and notes thereto appearing elsewhere in
this  Quarterly  Report  on  Form 10-Q. The discussion of the Company's business
contained in this Quarterly Report on Form 10-Q may contain certain projections,
estimates  and  other  forward-looking statements that involve a number of risks
and uncertainties, including those discussed below at "Risks and Uncertainties."
While  this  outlook  represents  management's  current  judgment  on the future
direction  of  the  business,  such  risks  and uncertainties could cause actual
results  to  differ  materially from any future performance suggested below. The
Company  undertakes  no  obligation  to  release  publicly  the  results  of any
revisions to these forward-looking statements to reflect events or circumstances
arising  after  the  date  hereof.

OVERVIEW
     Imaging  Technologies Corporation develops and distributes imaging software
and distributes high-quality digital imaging products. The Company sells a range
of  printer  and  imaging  products  for use in graphics and publishing, digital
photography,  and other niche business and technical markets. The Company's core
technologies  are  related  the design and development of software products that
improve the accuracy of color reproduction. ITEC's ColorBlind  software provides
color  management  to improve the accuracy of color reproduction - especially as
it  relates  to  matching  color between different devices in a network, such as
monitors  and  printers.
In  order  to  capitalize  on  its  existing  systems integration expertise, the
Company  has  begun  to  provide  more  services  to  help  with tasks that have
negatively  impacted  the  business  operations  of  our  exiting  and potential
customers.  To  this  end,  ITEC  has  begun to pursue strategic acquisitions in
personnel  and  employment  practice  management.  We  believe  that  there  is
considerable  synergy  between  providing  office  systems  solutions  with
administrative  services.
     The  Company  provides  comprehensive personnel management services through
its  wholly-owned  SourceOne  subsidiary.  SourceOne  is a professional employer
organization  ("PEO")  that provides benefits and payroll administration, health
and  workers' compensation insurance programs, personnel records management, and
employer  liability  management.
     The  Company's  business  continues to experience operational and liquidity
challenges.  Accordingly,  year-to-year  financial comparisons may be of limited
usefulness  now  and for the next several quarters due to anticipated changes in
the  Company's  business  as  these  changes  relate  to  acquisitions  of  new
businesses,  changes  in  product  lines,  and  the  potential for discontinuing
certain  components  of  the  business.
The  Company's  current  strategy  is:  (1) to commercialize its own technology,
which  is  embodies  in  its ColorBlind Color Management software, (2) to market
imaging  products,  including  printers,  copiers,  and consumables (toner, ink,
etc.)  from  other  manufacturers  to  its  customers, and (3) to expand its PEO
related  business  activities.
     To  successfully  execute  its  current  strategy, the Company will need to
improve  its  working  capital  position.  The  Company  plans  to  overcome the
circumstances  that  impact  our  ability  to  remain  a going concern through a
combination  of  achieving  profitability,  raising  additional  debt and equity
financing,  and  renegotiating  existing  obligations.
     There  can  be  no  assurance,  however,  that  the Company will be able to
complete  any additional debt or equity financings on favorable terms or at all,
or  that  any  such  financings,  if  completed,  will  be  adequate to meet the
Company's  capital  requirements.  Any  additional  equity  or  convertible debt
financings  could  result in substantial dilution to the Company's stockholders.
If  adequate  funds  are  not  available,  the Company may be required to delay,
reduce  or  eliminate  some  or  all  of  its  planned activities, including any
potential  mergers  or acquisitions. The Company's inability to fund its capital
requirements  would  have  a  material  adverse  effect on the Company. Also see
"Liquidity  and  Capital  Resources."  and  "Item  1.  Business  -  Risks  and
Uncertainties  -  Future  Capital  Needs."
Office  Products  and  Systems
     The  office  products  and  systems  industry  is  undergoing a fundamental
transformation  characterized  by  a  transition from analog to digital systems,
management  of  publishing  and  printing  over  the  Internet,  reliance  on
outsourcing,  and  the  rapid  transition  to  color  output.

     The  worldwide  document/imaging market is expected to grow to $209 billion
by  2003.  The  global  office  market is forecast to increase to $43 billion in
2003.  In-house  color  document  production  is  expected to grow at a compound
annual  rate  of  40%  over  the  next  few  years.
     ITEC's  office products and systems group integrates a variety of products,
including  printers, plotters, copiers, and software, into a seamless, networked
solution  for  clients  who  are  generally  small  to  medium sized businesses.
Hardware,  software  and  supplies  are  bundled together as a systems solution.
     ITEC's  e-commerce  initiatives, dealseekers.com and color.com, provide for
sales  and support of software products and consumables such as inks, toner, and
paper.
Personnel  Management  Systems  -  SourceOne
     As  ITEC  changes its focus from development and manufacturing to providing
business  services,  management  identified  the  opportunity  to  expand  into
personnel  and  human  resources  management.  ITEC hopes to leverage its office
products  and  systems  expertise  with  that  of offering professional employer
organization  (PEO)  services.
     The  Company's  SourceOne  PEO  business provides a broad range of services
associated  with  staff  leasing  and  human resources management. These include
benefits  and payroll administration, health and workers' compensation insurance
programs,  personnel records management, employer liability management, employee
recruiting  and  selection, performance management, and training and development
services.
     The  PEO  business  is  growing  rapidly,  but  profit  margins  are  low.
Consequently, profitability depends on (1) economies of scale leading to greater
operating  efficiencies;  and  (2)  value-added  services  such  as  training,
education,  Internet  support,  and  office  products  sales.
ACQUISITION  AND  SALE  OF  BUSINESS  UNITS
     On  October  25,  2001,  the Company acquired certain assets. These assets,
related  to  the  Company's  office  products  and services business activities,
represent  an  aggregate  of $260,000 and include inventories, fixed assets, and
accounts  receivable.  The  purchase price of the assets was 7,500,000 shares of
ITEC  common  stock,  determined by the market price of ITEC common stock at the
date  of  acquisition.  The  Company  has  agreed  to  register  these  shares.
     On November 12, 2001, the Company acquired all of the outstanding shares of
SourceOne  from  Neotactix, Inc. for 10,000,000 shares of ITEC common stock. The
acquisition  price  also  included  the  assumption  of $750,000 in payments due
SourceOne  from  Neotactix.  ITEC  paid $250,000 in cash at Closing. These funds
were  provided  by  outside  investors in exchange for 13,888,890 shares of ITEC
common  stock.  The  balance  is payable in cash or stock on a quarterly payment
schedule  beginning  in  April  2002.
     The  purchase  price was determined through analysis of SourceOne's recent,
unaudited  financial  performance.  SourceOne,  through  September 30, 2001, had
losses  of  approximately $220 thousand on 6-month revenues of approximately $25
million.  The  total purchase price of $750 thousand in cash plus the payment of
10,000,000 shares of ITEC common stock, was arrived at through negotiations. The
assets of SourceOne consist of cash, accounts receivable, and pre-paid insurance
premiums.
     The  Company  reported  this  transaction,  including  audited  financial
statements  of  SourceOne,  on  Form  8-K  dated  January  25,  2002.
RESULTS  OF  OPERATIONS  NET  REVENUES
     Revenues  were $8.1 million and $1 million for the three-month period ended
December  31,  2001 and 2000, respectively, an increase of $7.1 million or 703%.
Revenues  were  $9.2  million  and  $1.8  million for the six-month period ended
December  31,  2001 and 2000, respectively, an increase of $7.3 million or 398%.
The  increase  in revenues was due primarily to the PEO revenues associated with
the  acquisition  of  SourceOne  Group.
Sales  of  imaging  products  were  $891  thousand  and  $556  thousand  for the
three-month  period  ended December 31, 2001 and 2000, respectively, an increase
of  $335  thousand  or 61%. Sales of imaging products were $1.8 million and $1.2
million for the six-month period ended December 31, 2001 and 2000, respectively,
an  increase  of  $548  thousand  or 45%. The increase in product sales from the
reported  periods  of  2001  to 2000 was due to an overall increase in the sales
activities  of  the  Company.  The  Company  has devoted itself primarily to the
resale  of  office products, including copiers, printers, and network solutions.
However,  the  Company's  lack  of  sufficient  working capital has had, and may
continue  to  have,  a  negative  adverse  effect  on  product  sales.
     The Company had sales software sales, licensing fees, and royalties for the
three-month  period  ended  December 31, 2001 and 2000 of $145 thousand and $455
thousand,  respectively.  Software revenues fell by $310 thousand (69%). For the
six-month  period  ended  December  31, 2001 and 2000, software sales, licensing
fees,  and  royalties  were  $350  thousand  and  $632 thousand, respectively, a
reduction  of  $282  thousand  (45%). The reduction in software revenues was due
primarily  to  the  absence  of  licensing  and  royalty  income.
     Royalties and licensing fees vary from quarter to quarter and are dependent
on  the  sales  of  the  Company's  products  made by customers using ColorBlind
software  source code. However, ColorBlind software is sold by ITEC primarily as
a packaged application, whether as a stand-alone application or to be bundled by
our  customers  with  hardware imaging products such as printers and copiers. At
present,  and  in  the future, royalties from the licensing of ColorBlind source
code are not expected to be significant and will be reported as part of software
sales.
COST  OF  PRODUCTS  SOLD
     Cost  of  products  sold were $646 thousand (73% of product sales) and $481
thousand (87% of product sales) for the period ended December 31, 2001 and 2000,
respectively. For the six-month period ended December 31, 2001 and 2000, cost of
products  sold  were $1.2 million (69% of product sales) and $924 thousand  (76%
of  product  sales),  respectively.
     The  increase in margins is primarily due to changes in the Company's sales
and  distribution  strategies.  The  Company has concentrated on sales of office
products  and software rather than its prior strategy of selling its own branded
products,  which,  due  to a variety of competitive factors, resulted in heavier
discounting  and  lower  margins.  Management  hopes to increase margins through
adding  more  value to products it sells with software enhancements and offering
training  to  its  customers.
     Cost  of  software,  licenses and royalties were $24 thousand (17%) for the
three-month  period  ended  December  31,  2001  and  $54 thousand (16%) for the
six-month  period.  Comparative  results  for  the  year-earlier  period  is not
presented  because  it  is  currently  impracticable  to  do  so  due to various
reorganizations  of the Company's accounting systems. A comprehensive accounting
system  is  being  implemented  that  should  enable  the Company to report such
information  in  the  future.
     Cost  of PEO services were $6.8 million (96%) for the period ended December
31, 2001. The Company began providing these services pursuant to the acquisition
of  SourceOne  Group on November 12, 2001. Accordingly, results are presented as
of  the  date  of  acquisition.
SELLING,  GENERAL  AND  ADMINISTRATIVE  EXPENSES
     Selling,  general  and  administrative  expenses for the three-month period
ended  December  31,  2001  and  2000,  respectively, were $2.1 million and $1.7
million.  Selling,  general and administrative expenses for the six-month period
ended  December  31,  2001  and  2000,  respectively,  were  $3.6 million and $4
million.
     Selling,  general  and  administrative expenses have consisted primarily of
salaries  and commissions of sales and marketing personnel, salaries and related
costs for general corporate functions, including finance, accounting, facilities
and  legal,  advertising  and  other  marketing  related  expenses, and fees for
professional  services.  For  the  three-month  period  ended  December  31, the
selling,  general, and administrative expenses increased $416 thousand (25%) due
primarily  to  additional  costs associated with acquisitions, including its PEO
subsidiary,  SourceOne  Group.  However, for the six-month period ended December
31,  2001  and  2000,  the  Company reduced selling, general, and administrative
expenses  $486  thousand  (12%)  due  primarily  to  reductions  in  engineering
personnel,  which  were  assigned to the support of certain ITEC-branded printer
products,  which  have  been  suspended.
RESEARCH  AND  DEVELOPMENT
     Research  and development costs were $64 thousand and $217 thousand for the
three-month period ended December 31, 2001 and 2000, respectively; a decrease of
$153  thousand (71%). For the six-month period ended December 31, 2001 and 2000,
respectively,  research  and  development  costs  were  $136  thousand  and $456
thousand;  a  decrease  of  $320  thousand  (71%).
     The Company had been reducing its research and development costs during the
past  several  quarters.  It has suspended most of its engineering and licensing
activities associated with OEM printer products and has re-directed its research
and  development  costs  toward the support of its ColorBlind software products.
LIQUIDITY  AND  CAPITAL  RESOURCES
     Historically,  the  Company  has  financed its operations primarily through
cash  generated  from  operations,  debt  financing, and from the sale of equity
securities.  Additionally,  in  order  to  facilitate  its  growth  and  future
liquidity,  the  Company  has  made  some  strategic  acquisitions.
     As a result of some of the Company's financing activities, there has been a
significant  increase in the number of issued and outstanding shares. During the
three-months  period  ended  December  31 2001, the Company issued an additional
55.6  million  shares.  During the six-month period ended December 31, 2001, the
Company  issued  an additional 55.7 million shares. These shares of common stock
were  issued primarily for raising capital due for corporate expenses in lieu of
cash,  and  for  acquisitions.
     During  the  quarter,  ITEC  issued  27,236,338 common shares to holders of
convertible  notes  payable at an average conversion price of  $0.018 per share.
     ITEC issued during the quarter 9,898,666 registered common shares for legal
and consulting at a warrant conversion average price of $0.03 per share pursuant
to  previously  registrations under Form S-8. The Company recognized $294,491 in
expenses  as  a  result  of  the  conversions.
     Registered  warrants,  exercised  during the quarter at an average price of
$0.023  per  share,  amounted  to  5,667,277 common shares. The Company received
$131,575  in  cash.
     As  the  result  of  beneficial conversions of convertible notes payable to
common  stock,  during  the  quarters  ended December 31 and September 30, 2001,
$85,719  and  $579,699  was  charged  to  interest  expense  respectively.
     As  of December 31, 2001, the Company had negative working capital of $19.7
million,  a  decrease  of approximately $2.8 million (17%) in working capital as
compared  to  June  30,  2000.  This  increase was due primarily to increases in
short-term  debt.
     Net cash used in operating activities increased $318 thousand (12%) to $3.1
million  during  the six-month period ended December 31, 2001, from $2.8 million
during  the  year-earlier  period,  due  primarily  to costs associated with the
Company's  acquisition  of  SourceOne  Group  during  the  period.
Net  cash  used  in  investing  activities was $91 thousand during the six-month
period ended December 31, 2001 as compared to net cash from investing activities
of  $60  thousand  at  June  30,  2001.  The  change  was due primarily with the
Company's  cash  investment  for  the  SourceOne  Group  acquisition.
Net  cash  from  financing  activities was $3.3 million for the six-month period
ended  December  31,  2001, an increase of $487 thousand or 18%. The increase is
due  primarily  to  the  issuance  of  notes payable, which were used to finance
continuing  operations.
The  Company has no material commitments for capital expenditures. The Company's
5%  convertible  preferred  stock  (which  ranks  prior  to the Company's common
stock), carries cumulative dividends, when and as declared, at an annual rate of
$50.00  per share. The aggregate amount of such dividends in arrears at December
31,  2001,  was  approximately  $309  thousand.
The  Company's capital requirements depend on numerous factors, including market
acceptance  of  the  Company's  products and services, the resources the Company
devotes  to  marketing and selling its products and services, and other factors.
The report of the Company's independent auditors accompanying the Company's June
30, 2001 financial statements includes an explanatory paragraph indicating there
is  a  substantial  doubt  about  the  Company's  ability to continue as a going
concern, due primarily to the decreases in the Company's working capital and net
worth.  (Also  see  Note  2  to  the  Consolidate  Financial  Statements.)

RISKS  AND  UNCERTAINTIES
     IF  WE  ARE  UNABLE TO SECURE FUTURE CAPITAL, WE WILL BE UNABLE TO CONTINUE
OUR  OPERATIONS. Our business has not been profitable in the past and it may not
be  profitable in the future. We may incur losses on a quarterly or annual basis
for  a  number  of  reasons,  some  within  and  others outside our control. See
"Potential Fluctuation in Our Quarterly Performance." The growth of our business
will  require  the commitment of substantial capital resources. If funds are not
available  from  operations,  we  will  need  additional funds. We may seek such
additional  funding  through  public  and  private  financing, including debt or
equity  financing.  Adequate funds for these purposes, whether through financial
markets  or  from other sources, may not be available when we need them. Even if
funds are available, the terms under which the funds are available to us may not
be  acceptable  to  us.  Insufficient  funds  may require us to delay, reduce or
eliminate  some  or  all  of  our  planned  activities.
     To  successfully  execute our current strategy, we will need to improve our
working  capital  position.  The report of our independent auditors accompanying
the  Company's  June  30,  2001  financial  statements  includes  an explanatory
paragraph indicating there is a substantial doubt about the Company's ability to
continue  as  a  going  concern,  due  primarily to the decreases in our working
capital  and  net  worth.  The  Company plans to overcome the circumstances that
impact  our ability to remain a going concern through a combination of increased
revenues  and  decreased  costs,  with  interim  cash  flow  deficiencies  being
addressed  through  additional  equity  financing.
     IF OUR QUARTERLY PERFORMANCE CONTINUES TO FLUCTUATE, IT MAY HAVE A NEGATIVE
IMPACT  ON  OUR  BUSINESS.  Our  quarterly  operating  results  can  fluctuate
significantly  depending  on  a number of factors, any one of which could have a
negative impact on our results of operations. The factors include: the timing of
product  announcements  and subsequent introductions of new or enhanced products
by  us  and  by  our  competitors,  the availability and cost of products and/or
components,  the  timing  and  mix  of  shipments  of  our  products, the market
acceptance  of  our  new products, the availability of leasing or other purchase
financing  for our customers, seasonality, currency fluctuations, changes in our
prices  and in our competitors' prices, price protection offered to distributors
and  OEMs  for product price reductions, the timing of expenditures for staffing
and  related  support costs, the extent and success of advertising, research and
development  expenditures,  and  changes  in  general  economic  conditions.
     We  may  experience  significant  quarterly  fluctuations  in  revenues and
operating  expenses  as  we  introduce new products.  In addition, our component
purchases,  production and spending levels are based upon our forecast of future
demand  for  our  products.  Accordingly,  any inaccuracy in our forecasts could
adversely  affect  our financial condition and results of operations. Demand for
our products could be adversely affected by a slowdown in the overall demand for
computer  systems,  printer products or digitally printed images. Our failure to
complete  shipments during a quarter could have a material adverse effect on our
results  of  operations  for that quarter. Quarterly results are not necessarily
indicative  of  future  performance  for  any  particular  period.
     THE  MARKET  PRICE  OF  OUR  COMMON  STOCK  HISTORICALLY  HAS  FLUCTUATED
SIGNIFICANTLY. Our stock price could fluctuate significantly in the future based
upon  any  number of factors such as: general stock market trends, announcements
of  developments related to our business, fluctuations in our operating results,
a  shortfall in our revenues or earnings compared to the estimates of securities
analysts,  announcements  of  technological  innovations,  new  products  or
enhancements  by  us  or  our  competitors, general conditions in the markets we
serve,  general  conditions in the worldwide economy, developments in patents or
other  intellectual  property rights, and developments in our relationships with
our  customers  and  suppliers.
     In  addition,  in  recent years the stock market in general, and the market
for  shares  of  technology  and  other  stocks  have  experienced extreme price
fluctuations,  which  have  often been unrelated to the operating performance of
affected  companies.  Similarly,  the  market  price  of  our  common  stock may
fluctuate  significantly  based  upon  factors  unrelated  to  our  operating
performance.
     SINCE  OUR  COMPETITORS HAVE GREATER FINANCIAL AND MARKETING RESOURCES THAN
WE  DO,  WE MAY EXPERIENCE A REDUCTION IN MARKET SHARE AND REVENUES. The markets
for  our  products  are  highly  competitive  and  rapidly changing. Some of our
current  and  prospective  competitors  have  significantly  greater  financial,
technical,  manufacturing  and  marketing  resources  than we do. Our ability to
compete  in  our  markets depends on a number of factors, some within and others
outside our control. These factors include: the frequency and success of product
introductions  by  us and by our competitors, the selling prices of our products
and  of  our  competitors'  products, the performance of our products and of our
competitors'  products,  product  distribution by us and by our competitors, our
marketing  ability and the marketing ability of our competitors, and the quality
of  customer  support  offered  by  us  and  by  our  competitors.
     A  key  element of our strategy is to provide competitively priced, quality
products.  We  cannot  be  certain  that  our  products  will  continue  to  be
competitively  priced.  We have reduced prices on certain of our products in the
past  and  will likely continue to do so in the future. Price reductions, if not
offset by similar reductions in product costs, will reduce our gross margins and
may  adversely  affect  our  financial  condition  and  results  of  operations.
The  PEO  industry  in  which  we  operate  our  SourceOne  subsidiary is highly
fragmented.  While  many  of  our competitors have limited operations, there are
several  PEO companies equal or substantially greater in size than ours. We also
encounter  competition  from  "fee-for-service"  companies  such  as  payroll
processing  firms,  insurance  companies,  and  human resources consultants. The
large  PEO  companies  have  substantially  more resources than us and provide a
broader  range  of  resources  than  we  do.
     IF  WE  ACQUIRE COMPLEMENTARY BUSINESSES, WE MAY NOT BE ABLE TO EFFECTIVELY
INTEGRATE  THEM  INTO  OUR  CURRENT OPERATIONS, WHICH WOULD ADVERSELY AFFECT OUR
OVERALL  FINANCIAL  PERFORMANCE.  In  order to grow our business, we may acquire
businesses  that  we  believe  are complementary. To successfully implement this
strategy,  we  must  identify  suitable  acquisition  candidates,  acquire these
candidates  on  acceptable  terms,  integrate  their  operations  and technology
successfully  with  ours, retain existing customers and maintain the goodwill of
the  acquired  business.  We may fail in our efforts to implement one or more of
these tasks. Moreover, in pursuing acquisition opportunities, we may compete for
acquisition targets with other companies with similar growth strategies. Some of
these  competitors  may be larger and have greater financial and other resources
than  we  do. Competition for these acquisition targets likely could also result
in  increased  prices  of acquisition targets and a diminished pool of companies
available  for acquisition. Our overall financial performance will be materially
and  adversely affected if we are unable to manage internal or acquisition-based
growth  effectively.  Acquisitions  involve  a  number  of  risks,  including:
integrating  acquired  products and technologies in a timely manner, integrating
businesses  and  employees  with our business, managing geographically-dispersed
operations,  reductions  in  our  reported  operating  results  from
acquisition-related charges and amortization of goodwill, potential increases in
stock  compensation  expense  and  increased compensation expense resulting from
newly-hired  employees, the diversion of management attention, the assumption of
unknown liabilities, potential disputes with the sellers of one or more acquired
entities,  our  inability  to  maintain  customers  or  goodwill  of an acquired
business,  the  need  to  divest  unwanted  assets or products, and the possible
failure  to  retain  key  acquired  personnel.
     Client satisfaction or performance problems with an acquired business could
also have a material adverse effect on our reputation, and any acquired business
could  significantly  under  perform  relative to our expectations. We cannot be
certain  that  we  will  be  able  to integrate acquired businesses, products or
technologies successfully or in a timely manner in accordance with our strategic
objectives,  which could have a material adverse effect on our overall financial
performance.
     In  addition, if we issue equity securities as consideration for any future
acquisitions, existing stockholders will experience ownership dilution and these
equity  securities  may have rights, preferences or privileges superior to those
of  our  common  stock.
     IF WE ARE UNABLE TO DEVELOP AND/OR ACQUIRE NEW PRODUCTS IN A TIMELY MANNER,
WE  MAY  EXPERIENCE  A SIGNIFICANT DECLINE IN SALES AND REVENUES, WHICH MAY HURT
OUR  ABILITY  TO  CONTINUE  OPERATIONS.  The  markets  for  our  products  are
characterized by rapidly evolving technology, frequent new product introductions
and  significant  price competition. Consequently, short product life cycles and
reductions  in product selling prices due to competitive pressures over the life
of  a  product  are  common.  Our  future  success will depend on our ability to
continue  to  develop  new  versions  of our ColorBlind software, and to acquire
competitive  products  from  other  manufacturers.  We  monitor  new  technology
developments  and coordinate with suppliers, distributors and dealers to enhance
our  products  and  to lower costs. If we are unable to develop and acquire new,
competitive  products in a timely manner, our financial condition and results of
operations  will  be  adversely  affected.
IF  THE  MARKET'S ACCEPTANCE OF OUR PRODUCTS CEASES TO GROW, WE MAY NOT GENERATE
SUFFICIENT REVENUES TO CONTINUE OUR OPERATIONS. The markets for our products are
relatively  new and are still developing. We believe that there has been growing
market acceptance for color printers, color management software and supplies. We
cannot  be  certain,  however,  that  these markets will continue to grow. Other
technologies  are  constantly  evolving and improving. We cannot be certain that
products  based  on  these  other  technologies will not have a material adverse
effect  on the demand for our products.  If our products are not accepted by the
market,  we  will  not  generate sufficient revenues to continue our operations.
     IF  WE  ARE  FOUND TO BE INFRINGING ON A COMPETITOR'S INTELLECTUAL PROPERTY
RIGHTS  OR  IF WE ARE REQUIRED TO DEFEND AGAINST A CLAIM OF INFRINGEMENT, WE MAY
BE  REQUIRED  TO  REDESIGN  OUR PRODUCTS OR DEFEND A LEGAL ACTION AT SUBSTANTIAL
COSTS  TO  US.  We  currently  hold  no patents. Our software products, hardware
designs, and circuit layouts are copyrighted. However, copyright protection does
not prevent other companies from emulating the features and benefits provided by
our  software,  hardware  designs  or the integration of the two. We protect our
software  source  code  as  trade  secrets  and make our proprietary source code
available  to  OEM  customers  only  under  limited  circumstances  and specific
security  and  confidentiality  constraints.
     Competitors  may assert that we infringe their patent rights. If we fail to
establish  that we have not violated the asserted rights, we could be prohibited
from  marketing  the  products  that  incorporate the technology and we could be
liable  for  damages.  We  could  also  incur  substantial costs to redesign our
products  or  to defend any legal action taken against us. We have obtained U.S.
registration  for  several  of  our  trade names or trademarks, including: PCPI,
NewGen,  ColorBlind,  LaserImage,  ColorImage,  ImageScript and ImageFont. These
trade  names  are  used  to  distinguish  our  products  in  the  marketplace.
     IF INTERNATIONAL FINANCIAL CONDITIONS DETERIORATE, OUR CONTINUED OPERATIONS
AND  OVERALL  FINANCIAL  PERFORMANCE  WILL  BE  NEGATIVELY  IMPACTED. We conduct
business  globally.  Accordingly, our future results could be adversely affected
by  a variety of uncontrollable and changing factors including: foreign currency
exchange  fluctuations,  regulatory,  political  or  economic  conditions  in  a
specific  country  or  region,  the  imposition of governmental controls, export
license  requirements,  restrictions on the export of critical technology, trade
restrictions,  changes  in  tariffs,  government  spending  patterns,  natural
disasters,  difficulties  in staffing and managing international operations; and
difficulties  in  collecting  accounts  receivable.
     In  addition, the laws of certain countries do not protect our products and
intellectual  property  rights  to  the  same  extent  as the laws of the United
States.
     We  intend to pursue international markets as key avenues for growth and to
increase  the  percentage  of  sales  generated in international markets. In our
2001,  2000,  and 1999 fiscal years, sales outside the United States represented
approximately  72%,  2%, and 56% of our net sales, respectively. We expect sales
outside  the United States to continue to represent a significant portion of our
sales.  As  we  continue  to  expand our international sales and operations, our
business  and  overall  financial  performance  may be adversely affected by the
factors  stated  above.
     IF  OUR WORLDWIDE DISTRIBUTORS REDUCE OR DISCONTINUE SALES OF OUR PRODUCTS,
OUR BUSINESS MAY BE MATERIALLY AND ADVERSELY AFFECTED. Our products are marketed
and sold through a distribution channel of value added resellers, manufacturers'
representatives,  retail  vendors, and systems integrators. We have a network of
dealers  and  distributors  in  the  United  States  and Canada, in the European
Community  and  on  the  European  Continent,  as  well  as  a growing number of
resellers  in  Africa,  Asia,  the Middle East, Latin America, and Australia. We
support  our  worldwide  distribution  network  and  end-user  customers through
operations  headquartered  in  San  Diego.  As  of November 8, 2001, we directly
employed  18  individuals  involved  in  marketing  and  sales  activities.
     A  portion  of  our  sales  are  made through distributors, which may carry
competing  product  lines.  These distributors could reduce or discontinue sales
of our products, which could adversely affect us. These independent distributors
may  not devote the resources necessary to provide effective sales and marketing
support  of  our  products.  In  addition,  we  are dependent upon the continued
viability and financial stability of these distributors, many of which are small
organizations  with  limited  capital.  These  distributors,  in  turn,  are
substantially  dependent on general economic conditions and other unique factors
affecting  our  markets.
     INCREASES  IN  HEALTH  INSURANCE PREMIUMS, UNEMPLOYMENT TAXES, AND WORKERS'
COMPENSATION  RATES  WILL  HAVE  A  SIGNIFICANT  EFFECT  ON OUR FUTURE FINANCIAL
PERFORMANCE.  Health  insurance premiums, state unemployment taxes, and workers'
compensation rates are, in part, determined by our SourceOne subsidiary's claims
experience,  and  comprise a significant portion of SourceOne's direct costs. We
employ  risk management procedures in an attempt to control claims incidence and
structure  our benefits contracts to provide as much cost stability as possible.
However,  should  we  experience  a  large  increase  in  claims  activity,  the
unemployment  taxes,  health  insurance  premiums,  or  workers'  compensation
insurance rates we pay could increase. Our ability to incorporate such increases
into  service fees to clients is generally constrained by contractual agreements
with  our  clients.  Consequently,  we  could  experience  a  delay  before such
increases  could  be  reflected in the service fees we charge. As a result, such
increases  could  have  a  material adverse effect on our financial condition or
results  of  operations.
WE CARRY SUBSTANTIAL LIABILITY FOR WORKSITE EMPLOYEE PAYROLL AND BENEFITS COSTS.
Under  our  client  service  agreements,  we  become  a  co-employer of worksite
employees  and we assume the obligations to pay the salaries, wages, and related
benefits  costs  and  payroll  taxes  of such worksite employees. We assume such
obligations  as  a  principal, not merely as an agent of the client company. Our
obligations include responsibility for (a) payment of the salaries and wages for
work  performed  by worksite employees, regardless of whether the client company
makes  timely  payment  to  SourceOne  of  the  associated  service fee; and (2)
providing  benefits  to  worksite  employees  even  if the costs incurred by the
SourceOne  to  provide such benefits exceed the fees paid by the client company.
If  a  client  company  does not pay us, or if the costs of benefits provided to
worksite  employees  exceed  the  fees  paid  by  a client company, our ultimate
liability for worksite employee payroll and benefits costs could have a material
adverse  effect  on  the Company's financial condition or results of operations.
AS A MAJOR EMPLOYER, OUR OPERATIONS ARE AFFECTED BY NUMEROUS FEDERAL, STATE, AND
LOCAL  LAWS  RELATED  TO  LABOR, TAX, AND EMPLOYMENT MATTERS. By entering into a
co-employer  relationship  with  employees  assigned  to  work at client company
locations,  we  assume  certain  obligations and responsibilities or an employer
under  these  laws. However, many of these laws (such as the Employee Retirement
Income  Security Act ("ERISA") and federal and state employment tax laws) do not
specifically  address  the  obligations  and responsibilities of non-traditional
employers such as PEOs; and the definition of "employer" under these laws is not
uniform. Additionally, some of the states in which we operate have not addressed
the  PEO  relationship  for  purposes  of  compliance with applicable state laws
governing  the  employer/employee  relationship. If these other federal or state
laws  are ultimately applied to our PEO relationship with our worksite employees
in  a  manner  adverse to the Company, such an application could have a material
adverse  effect  on  the Company's financial condition or results of operations.
While  many  states  do not explicitly regulate PEOs, 21 states have passed laws
that  have  licensing  or  registration requirements for PEOs, and several other
states  are considering such regulation. Such laws vary from state to state, but
generally  provide for monitoring the fiscal responsibility of PEOs and, in some
cases,  codify  and  clarify  the  co-employment  relationship for unemployment,
workers'  compensation,  and  other  purposes  under  state law. There can be no
assurance  that  we  will  be  able  to  satisfy licensing requirements of other
applicable  relations  for  all  states. Additionally, there can be no assurance
that  we  will  be  able  to  renew  our  licenses  in  all  states.
THE  MAINTENANCE  OF HEALTH AND WORKERS' COMPENSATION INSURANCE PLANS THAT COVER
WORKSITE EMPLOYEES IS A SIGNIFICANT PART OF OUR BUSINESS. The current health and
workers'  compensation  contracts  are  provided by vendors with whom we have an
established relationship, and on terms that we believe to be favorable. While we
believe that replacement contracts could be secured on competitive terms without
causing  significant  disruption  to  our business, there can be no assurance in
this  regards.
OUR  STANDARD AGREEMENTS WITH PEO CLIENTS ARE SUBJECT TO CANCELLATION ON 60-DAYS
WRITTEN  NOTICE BY EITHER THE COMPANY OR THE CLIENT. Accordingly, the short-term
nature  of  these  agreements  make  us vulnerable to potential cancellations by
existing  clients,  which  could  materially  and adversely affect our financial
condition and results of operations. Additionally, our results of operations are
dependent,  in part, upon our ability to retain or replace client companies upon
the  termination  or  cancellation  of  our  agreements.
A  NUMBER  OF  LEGAL  ISSUES REMAIN UNRESOLVED WITH RESPECT TO THE CO-EMPLOYMENT
AGREEMENT  BETWEEN  A  PEO  AND  ITS  WORKSITE  EMPLOYEES,  INCLUDING  QUESTIONS
CONCERNING  THE  ULTIMATE  LIABILITY  FOR  VIOLATIONS  OF  EMPLOYMENT  AND
DISCRIMINATION  LAWS.  Our  client  service  agreement establishes a contractual
division  of  responsibilities  between  the Company and our clients for various
personnel  management  matters,  including  compliance  with and liability under
various government regulations. However, because we act as a co-employer, we may
be  subject  to  liability  for  violations of these or other laws despite these
contractual  provisions,  even  if  we  do  not  participate in such violations.
Although  our agreement provides that the client is to indemnify the Company for
any  liability  attributable to the conduct of the client, we may not be able to
collect on such a contractual indemnification claim, and thus may be responsible
for  satisfying such liabilities. Additionally, worksite employees may be deemed
to  be agents of the Company, subjecting us to liability for the actions of such
worksite  employees.
     IF  ALL  OF THE LAWSUITS CURRENTLY FILED WERE DECIDED AGAINST US AND/OR ALL
THE JUDGMENTS CURRENTLY OBTAINED AGAINST US WERE TO BE IMMEDIATELY COLLECTED, WE
WOULD  HAVE  TO CEASE OUR OPERATIONS. On or about October 7, 1999, the law firms
of Weiss & Yourman and Stull, Stull & Brody made a public announcement that they
had  filed  a  lawsuit  against  us and certain current and past officers and/or
directors,  alleging  violation  of federal securities laws during the period of
April  21,  1998  through  October  9,  1998. On or about November 17, 1999, the
lawsuit,  filed  in  the  name of Nahid Nazarian Behfarin, on her own behalf and
others purported to be similarly situated, was served on us. A motion to dismiss
the  lawsuit was granted on February 16, 2001 on our behalf and those individual
defendants  that  have  been  served.  However,  on  or about March 19, 2001, an
amended  complaint  was  filed  by  Nahid Nazarian Behfarin, Peter Cook, Stephen
Domagala  and  Michael  S.  Taylor, on behalf of themselves and others similarly
situated.  On  or  about March 20, 2001, we once again filed a motion to dismiss
the  case  along with certain other individual defendants. The motion was denied
and  an  answer  to  the  complaint  has been filed on behalf of the company and
certain  individual defendants. We believe these claims are without merit and we
intend  to  vigorously defend against them on our behalf as well as on behalf of
the  other  defendants.  The  defense  of  this  action has been tendered to our
insurance  carriers.
     Throughout fiscal 1999, 2000 and 2001, and through the date of this filing,
approximately  fifty  trade  creditors  have  made  claims  and/or filed actions
alleging  the  failure  of  us  to pay our obligations to them in a total amount
exceeding  $3  million.  These actions are in various stages of litigation, with
many  resulting in judgments being entered against us. Several of those who have
obtained  judgments  have filed judgment liens on our assets. These claims range
in  value  from less than one thousand dollars to just over one million dollars,
with  the  great majority being less than twenty thousand dollars.  Should we be
required  to  pay the full amount demanded in each of these claims and lawsuits,
we  may  have  to cease our operations.  However, to date, the superior security
interest held by Imperial Bank has prevented nearly all of these trade creditors
from  collecting  on  their  judgments.
     IF  OUR  OPERATIONS  CONTINUE  TO  RESULT  IN  A NET LOSS, NEGATIVE WORKING
CAPITAL  AND A DECLINE IN NET WORTH, AND WE ARE UNABLE TO OBTAIN NEEDED FUNDING,
WE  MAY  BE  FORCED  TO  DISCONTINUE OPERATIONS.  For several recent periods, up
through  the  present, we had a net loss, negative working capital and a decline
in  net worth, which raises substantial doubt about our ability to continue as a
going  concern.  Our losses have resulted primarily from an inability to achieve
revenue  targets  due  to  insufficient working capital. Our ability to continue
operations will depend on positive cash flow, if any, from future operations and
on  our  ability  to  raise  additional  funds through equity or debt financing.
Although we have reduced our work force and suspended some of our operations, if
we  are  unable to achieve the necessary product sales or raise or obtain needed
funding,  we  may  be  forced  to  discontinue  operations.
     IF  AN OPERATIONAL RECEIVER IS REINSTATED TO CONTROL OUR OPERATIONS, WE MAY
NOT  BE  ABLE TO CARRY OUT OUR BUSINESS PLAN. On August 20, 1999, at the request
of Imperial Bank, our primary lender, the Superior Court, San Diego appointed an
operational  receiver to us. On August 23, 1999, the operational 65receiver took
control  of our day-to-day operations. On June 21, 2000, the Superior Court, San
Diego  issued  an  order  dismissing  the  operational  receiver  as a part of a
settlement of litigation with Imperial Bank pursuant to the Settlement Agreement
effective  as  of June 20, 2000.  The Settlement Agreement requires that we make
monthly  payments of $150,000 to Imperial Bank until the indebtedness is paid in
full.  However,  in the future, without additional funding sufficient to satisfy
Imperial  Bank  and  our  other  creditors, as well as providing for our working
capital,  there  can  be  no  assurances that an operational receiver may not be
reinstated.  If  an  operational  receiver is reinstated, we will not be able to
expand our products nor will we have complete control over sales policies or the
allocation  of  funds.
     The  penalty  for noncompliance of the Settlement Agreement is a stipulated
judgment  that  allows  Imperial  Bank  to immediately reinstate the operational
receiver  and begin liquidation proceedings against us. We are currently meeting
the  monthly  amount  of $150,000 as stipulated by the Settlement Agreement with
Imperial  Bank.  However,  the  monthly  payments  have been reduced to $100,000
through  January  of  2002.
     THE  DELISTING OF OUR COMMON STOCK FROM THE NASDAQ SMALLCAP MARKET HAS MADE
IT MORE DIFFICULT TO RAISE FINANCING, AND THERE IS LESS LIQUIDITY FOR OUR COMMON
STOCK  AS  A  RESULT.  The  Nasdaq  SmallCap Market and Nasdaq Marketplace Rules
require  an issuer to evidence a minimum of $2,000,000 in net tangible assets, a
$35,000,000 market capitalization or $500,000 in net income in the latest fiscal
year  or in two of the last three fiscal years, and a $1.00 per share bid price,
respectively. On October 21, 1999, Nasdaq notified us that we no longer complied
with  the  bid  price  and  net tangible assets/market capitalization/net income
requirements  for  continued listing on The Nasdaq SmallCap Market. At a hearing
on  December  2,  1999, a Nasdaq Listing Qualifications Panel also raised public
interest  concerns  relating  to  our  financial  viability.  While  the  Panel
acknowledged  that we were in technical compliance with the bid price and market
capitalization  requirements,  the  Panel  was of the opinion that the continued
listing  of  our  common  stock  on  The  Nasdaq  Stock  Market  was  no  longer
appropriate.  This  conclusion  was  based on the Panel's concerns regarding our
future  viability.  Our  common  stock was delisted from The Nasdaq Stock Market
effective  with  the  close  of  business on March 1, 2000. As a result of being
delisted  from  The  Nasdaq  SmallCap  Market,  stockholders  may  find  it more
difficult to sell our common stock. This lack of liquidity also may make it more
difficult  for  us  to  raise  capital  in  the  future.
     Trading of our common stock is now being conducted over-the-counter through
the  NASD  Electronic  Bulletin  Board  and  covered  by  Rule  15g-9  under the
Securities  Exchange  Act of 1934. Under this rule, broker/dealers who recommend
these  securities  to  persons  other  than established customers and accredited
investors  must  make  a  special  written  suitability  determination  for  the
purchaser  and  receive the purchaser's written agreement to a transaction prior
to  sale.  Securities  are exempt from this rule if the market price is at least
$5.00  per  share.
     The  Securities  and Exchange Commission adopted regulations that generally
define  a  "penny  stock" as any equity security that has a market price of less
than  $5.00 per share. Additionally, if the equity security is not registered or
authorized  on  a  national securities exchange or the Nasdaq and the issuer has
net  tangible assets under $2,000,000, the equity security also would constitute
a  "penny  stock."  Our  common  stock does constitute a penny stock because our
common  stock  has a market price less than $5.00 per share, our common stock is
no longer quoted on Nasdaq and our net tangible assets do not exceed $2,000,000.
As  our  common  stock  falls  within  the  definition  of  penny  stock,  these
regulations  require the delivery, prior to any transaction involving our common
stock,  of a disclosure schedule explaining the penny stock market and the risks
associated  with  it.  Furthermore,  the  ability  of broker/dealers to sell our
common  stock  and  the  ability of stockholders to sell our common stock in the
secondary  market  would  be  limited. As a result, the market liquidity for our
common  stock  would  be  severely  and  adversely  affected.  We can provide no
assurance that trading in our common stock will not be subject to these or other
regulations  in  the  future,  which  would negatively affect the market for our
common  stock.

ITEM  3.  QUANTITATIVE  AND  QUALITATIVE  DISCLOSURES  ABOUT  MARKET  RISK
        Not  applicable.

PART  II  -  OTHER  INFORMATION
ITEM  1.  LEGAL  PROCEEDINGS
     On  or  about  October 7, 1999, the law firms of Weiss & Yourman and Stull,
Stull  &  Brody made a public announcement that they had filed a lawsuit against
us and certain current and past officers and/or directors, alleging violation of
federal  securities  laws during the period of April 21, 1998 through October 9,
1998.  On  or  about  November 17, 1999, the lawsuit, filed in the name of Nahid
Nazarian  Behfarin,  on  her  own  behalf  and  others purported to be similarly
situated,  was  served  on  us.  A  motion to dismiss the lawsuit was granted on
February  16,  2001 on our behalf and those individual defendants that have been
served.  However,  on or about March 19, 2001, an amended complaint was filed by
Nahid  Nazarian Behfarin, Peter Cook, Stephen Domagala and Michael S. Taylor, on
behalf  of themselves and others similarly situated. On or about March 20, 2001,
we  once  again  filed  a  motion  to  dismiss the case along with certain other
individual  defendants. The motion was denied and an answer to the complaint has
been  filed  on  behalf  of  the  company  and certain individual defendants. We
believe  these  claims  are  without  merit  and  we intend to vigorously defend
against  them  on  our  behalf as well as on behalf of the other defendants. The
defense  of  this  action  has  been  tendered  to  our  insurance  carriers.
     Throughout fiscal 1999, 2000 and 2001, and through the date of this filing,
approximately  fifty  trade  creditors  have  made  claims  and/or filed actions
alleging  the  failure  of  us  to pay our obligations to them in a total amount
exceeding  $3  million.  These actions are in various stages of litigation, with
many  resulting in judgments being entered against us. Several of those who have
obtained  judgments  have filed judgment liens on our assets. These claims range
in  value  from less than one thousand dollars to just over one million dollars,
with  the  great  majority  being  less  than  twenty  thousand  dollars.
     Furthermore,  from  time to time, the Company may be involved in litigation
relating  to  claims  arising  out  of  its  operations  in the normal course of
business.
ITEM  2.  CHANGES  IN  SECURITIES  AND  USE  OF  PROCEEDS
Common  Stock  Warrants
-----------------------
     The  Company,  from  time-to-time, grants warrants to employees, directors,
outside  consultants  and other key persons, to purchase shares of the Company's
common  stock,  at an exercise price equal to no less than the fair market value
of  such  stock  on  the  date  of  grant.
     In  the first quarter ended September 30, 2001, the Company issued warrants
to  directors  and  certain  officers to purchase up to 55,000,000 shares of its
common  stock  at an exercise price equal to $0.02 per share. The value of these
warrants  for  non-officer  directors  is  estimated  at  $66,000.
     Registered  warrants,  exercised  during the quarter at an average price of
$0.023  per  share,  amounted  to  5,667,277 common shares. The Company received
$131,575  in  cash.
ITEM  3.  DEFAULTS  UPON  SENIOR  SECURITIES
     None
ITEM  4.  SUBMISSION  OF  MATTERS  TO  A  VOTE  OF  SECURITY  HOLDERS
     None
ITEM  5.  OTHER  INFORMATION
None
ITEM  6.  EXHIBITS  AND  REPORTS  ON  FORM  8-K
          Exhibits:
          10(a)     Secured  Convertible  Debenture  issued  by  the  Company to
Bristol  Investment  Fund,  Ltd.,  dated                    January  22,  2002.
          10(b)     Securities  Purchase  Agreement  between  the  Company  and
Bristol  Investment  Fund,  Ltd.,  dated                    January  22,  2002.
          10(c)     Registration  Rights  Agreement  between  the  Company  and
Bristol  Investment  Fund,  Ltd.,  dated                    January  22,  2002.
          10(d)     Transaction  Fee Agreement between the Company and Alexander
Dunham  Securities,  Inc.,  dated                    January  22,  2002.
          10(e)     Stock  Purchase  Warrant  issued  to  Alexander  Dunham
Securities,  Inc.,  dated  January  22,  2002.
          10(f)     Stock  Purchase  Warrant  issued to Bristol Investment Fund,
Ltd.,  dated  January  22,  2002.
          10(g)     Security  Agreement  between  the  Company  and  Bristol
Investment  Fund,  Ltd.,  dated  January  22,                    2002.
          10(h)     Convertible  Promissory  Note  between  the  Company  and
Stonestreet  Limited  Partnership,  dated                    November  7,  2001.
          10(i)     Convertible Note Purchase agreement  between the Company and
Stonestreet  Limited  Partnership,               dated  November  7,  2001.
          10(j)     Registration  Rights  Agreement  between  the  Company  and
Stonestreet  Limited  Partnership,                    dated  November  7,  2001.
          10(k)     Stock  Purchase  Warrant  issued  to  Stonestreet  Limited
Partnership,  dated  November  7,  2001.
          27     Financial  Data  Schedule

Reports  on  Form  8-K:
     The  Company  filed a report on Form 8-K dated January 25, 2001, related to
the  acquisition  of  SourceOne  Group,  Inc.

<PAGE>
SIGNATURES
----------

     Pursuant  to  the  requirements 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.

Dated:  February  13,  2001

IMAGING  TECHNOLOGIES  CORPORATION  (Registrant)

By:  /S/
_____________________________________
Brian  Bonar
Chairman,  Chief  Executive  Officer,  and  Chief  Accounting  Officer

<PAGE>