SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-K/A

(Mark one)
    [X]  Annual  report  pursuant  to  Section  13 or 15(d) of the  Securities
Exchange Act of 1934 for the fiscal year ended October 31, 1999.

         Transition report under section 13 or 15(d) of the Securities  Exchange
Act of 1934 for the transition period from to _______________ to ______________.

Commission file number     0-011228

                       DIGITAL COMMERCE INTERNATIONAL INC.
             (Exact Name of Registrant as Specified in Its Charter)

                   Delaware                                  02-0337028
        (State or Other Jurisdiction of                   (I.R.S. Employer
        Incorporation or Organization)                   Identification No.)

         815 Hornby Street, Suite 404,
      Vancouver, British Columbia                            V6Z 2E6
   (Address of principal executive office)                 (Zip Code)

                                  604.899.0411
                           (Issuer's telephone number)

         Securities to be registered under Section 12(b) of the Act:

                  Title of Each Class                    Name of Each Exchange
                                                         On Which Registered

                          None                                   None

         Securities to be registered pursuant to Section 12(g) of the Act:

                          Common Stock, par value $.001

         Indicate  by check mark  whether the  registrant  (1) 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),  Yes[X] No ____, and (2) has been
subject to such filing requirements for the past 90 days. Yes [X] No _____

         Indicate by check mark if disclosure of delinquent  filers  pursuant to
Item 405 of Regulation S-K is not contained  herein,  and will not be contained,
to the best of  registrant's  knowledge,  in  definitive  proxy  or  information
statements  incorporated  by  reference  in Part III of this Form  10-K/A or any
amendment to this Form 10-K/A.

         State the aggregate  market value of the voting and  non-voting  common
equity held by  non-affiliates  of the  registrant.  The aggregate  market value
shall be computed by reference to the price at which the common equity was sold,
or the average bid and asked  prices of such  common  equity,  as of a specified
date within 60 days prior to the date of filing: $93,934,688.

         Indicate the number of shares  outstanding of each of the  registrant's
classes of common stock, as of the latest practicable date: 12,967,500.

                                     Part I

Item 1.  Business.

         (a)      General.

         Digital  Commerce  International,  Inc. ("The  Company") is a financial
services holding  company.  The Company engaged in two primary types of business
activities  during fiscal year 1999.  First,  it  facilitated  the issuance of a
merchant number,  an  identification  number given to a merchant by an acquiring
bank which  allows the  merchant to accept  credit card  payments,  to a company
listed on the Nasdaq  bulletin  board.  It generally  takes between one to seven
days  to  issue  the  merchant  number,  depending  on the  completeness  of the
application and the expected monthly credit card volume.  As of October 31, 1999
we had performed  this service for I-Crystal  since then we have also  performed
this  service  for other  companies  including  I-Shopper,  Total  I-Net,  Grace
Software,  and Tona Slym.  Second,  the  Company  acted as a sales  agent for an
independent sales organization named Intercontinental Financial Services. In the
future,  the  Company  intends  to  provide  a  variety  of  banking,   bankcard
processing,  and  financial  services  through  its  wholly-owned,   diversified
internet operating subsidiaries.

         The  Company's   operations  are  conducted  through  its  wholly-owned
subsidiaries,  including  Digital  Commerce  Inc.,  Digital  Commerce Bank Inc.,
Digital Commerce Merchant Services Inc., and Digital Commerce Canada Ltd.

          o    Digital  Commerce  Bank Inc.  During  fiscal  year 1999,  Digital
               Commerce  Bank Inc.  acted as a sales  agent  for an  independent
               sales organization named Intercontinental Financial Services. The
               Company hopes that in the future, Digital Commerce Bank Inc. will
               deliver  international  banking  services  through  its  Class  I
               Offshore  Banking  Charter,   which  it  has  obtained  from  the
               government  of Saint  Vincent  and the  Grenadines.  The  Company
               intends  for the  bank to  focus on the  settlement  of  merchant
               accounts  for  international   bankcard  processing  and  private
               banking for high net worth individuals.

          o    Digital Commerce Merchant Services Inc. Digital Commerce Merchant
               Services  Inc.  did not  generate  revenues  in fiscal year 1999.
               However,  Digital  Commerce  Merchant  Services  Inc.  is  now  a
               registered  Independent Sales  Organization and Merchant Services
               Provider for Humboldt Bank. The Company  anticipates  that in the
               future,  Digital  Commerce  Merchant  Services  Inc. will provide
               bankcard   processing  services  to  domestic  and  international
               merchants on behalf of United States and international  acquiring
               banks.

          o    Digital Commerce Inc. Digital Commerce Inc. acts as a sales agent
               for  organizations  engaged  in the  processing  of  credit  card
               transactions for international merchants.

          o    Digital  Commerce Canada Ltd. Digital Commerce Canada Ltd., which
               did  not  generate  revenues  during  fiscal  year  1999,  is the
               Company's technology development division. Through this division,
               the  Company  attempts to expand its  technological  capabilities
               through  research and  development.  Digital Commerce Canada Ltd.
               also  provides  administrative  services to the Digital  Commerce
               International, Inc. group of companies.

         The Company hopes to provide  United States and  international  clients
with  financial  and banking  services.  To that end,  the Company is  currently
pursuing the acquisition of a federal/state  banking charter.  While the Company
cannot  offer  any  assurance  that  the   contemplated   acquisition   will  be
consummated, it expects to conclude this acquisition during fiscal year 2000.

         (b)      Corporate History

            The Company was  incorporated  in July,  1982, as Systems  Assurance
Corporation.  From 1992 through  June 15, 1999,  the Company did not conduct any
active business operations,  but pursued business opportunities to merge with or
acquire  other  businesses.  On June  15,  1999,  the  Company  entered  into an
agreement  for the  acquisition  of all the  outstanding  capital  securities of
Digital Commerce Inc., a banking and financial services  organization ("DCI") in
exchange for 5,000,000  shares of the Company's  common stock and 500,000 shares
of the Company's convertible Class A preferred stock.  (Preferred stock has been
approved by the board of  directors  and  shareholders,  but the Company has not
amended its Articles of  Incorporation  and the  preferred  shares have not been
created and registered with the State of Delaware. The Company is in the process
of having  such  shares  registered.)  As a result of the  acquisition,  Digital
Commerce  Inc.  became  the  Company's  wholly-owned  subsidiary  and the former
shareholders of DCI became the Company's  minority  shareholders.  At that time,
the  Company  changed its name from  Systems  Assurance  Corporation  to Digital
Commerce  International Inc., and obtained a new CUSIP number and trading symbol
(THBK) for its common stock.

         The  combination  of Digital  Commerce  International  Inc. and Digital
Commerce  Inc.  was  recorded  as  a   recapitalization   of  Digital   Commerce
International Inc. In conjunction with the acquisition and  recapitalization,  a
prior director surrendered back to and the Company canceled 14,340,744 shares of
common stock. After the recapitalization  there were 11,740,000 shares of common
stock  outstanding  with  approximately 57 percent of those shares being held by
former stockholders of the Company.

            Michael Kang, the Company's Chief  Executive  Officer and President,
and John W. Combs,  the Company's  Executive Vice President and Secretary,  each
received  2,000,000  shares of the Company's  common stock and 250,000 shares of
the Company's  preferred stock as a result of the acquisition,  representing 48%
of the Company's  outstanding  shares as of October 31, 1999, on a fully-diluted
basis.  Each  share of  preferred  stock  issued  to  Messrs.  Kang and Combs is
convertible into 10 shares of common stock if certain  performance  criteria are
met.

            Pursuant to the acquisition of Digital Commerce Inc.,  Messrs.  Kang
and Combs were appointed to the Company's Board of Directors, each of whom is to
serve until his  respective  successor has been duly elected and  qualified,  or
until their respective earlier resignation or retirement.

         (c)      Operations

         The Company is a developing company. In the future the Company hopes to
provide a variety of banking and financial  services  through its  wholly-owned,
diversified  internet operating  subsidiaries.  Such services shall include, the
issuance of merchant  accounts,  the  issuance of business  bank  accounts,  and
online bank account management.  The Company's banking functions will be offered
in  conjunction  with a  registered  U.S.  Bank while its other  operations  are
conducted  through its  wholly-owned  subsidiaries,  including  through  Digital
Commerce Bank Inc.,  Digital  Commerce  Merchant  Services Inc, Digital Commerce
Inc., and Digital Commerce Canada Ltd.

         Digital Commerce Bank Inc.

         Digital Commerce Bank Inc. ("DCB"),  one of the Company's  wholly-owned
subsidiaries,  was  incorporated  on August  19th,  1999 in the country of Saint
Vincent and the Grenadines,  where it is based.  Digital Commerce Bank, Inc. was
incorporated as a subsidiary of Digital Commerce  International,  Inc.  ("DCII")
and operates as a  wholly-owned  subsidiary  of the  Company.  DCB was granted a
Class I Offshore  Banking  License by Saint Vincent and the Grenadines on August
23rd,  1999. The Class I Offshore  Banking License that was granted to us by the
government of Saint  Vincent and the  Grenadines is permanent as long as we meet
certain  requirements  and regulations as defined by the government of the Saint
Vincent and the  Grenadines.  Under the  conditions of the licensing  agreement,
Digital  Commerce  Bank,  Inc.  was  required to post a security  deposit in the
amount of $100,000 with the Government of Saint Vincent.  The deposit remains an
asset of DCB, to be released only upon cancellation or surrender of the license.
The deposit is held by the  International  Finance Authority of Saint Vincent in
an interest bearing account to the benefit of DCB.

         DCB has been established to facilitate a broad range of banking, trust,
and  merchant  service  functions on a fee for service  basis for  international
clients.  Since the granting of its license, DCB has arranged for the facilities
and established the strategic  relationships necessary to provide the full range
of services  required by  international  merchant and private  banking  clients,
including   internet   banking.    DCB also serves as an independent sales agent
for   Intercontinental   Financial  Services,   for  whom  the  Company  provide
third-party,  online,  real time  processing for  international  merchants.  The
Company hopes that Digital Commerce Bank, Inc will be fully  operational  within
the second fiscal quarter of the year 2000.

         Digital Commerce Merchant Services Inc. (D/B/A. "Bankthat.com")

         Digital  Commerce  Merchant  Services,  Inc.  ("DCMS"),  another of the
Company's wholly owned  subsidiaries,  was incorporated in the State of Delaware
in  November  1999.  It  operates  under the trade  name of  "Bankthat.com"  and
maintains its principal business operations in Salt Lake City, Utah. The Company
intends to develop DCMS in the near term into an Independent Sales Organization,
assembling  merchant  portfolios on behalf of United States  acquiring  banks to
facilitate bankcard processing for domestic merchants.

On November 8, 1999, the Company entered into an agreement with Humboldt Bank of
Eureka,  California to be an  Independent  Sales  Organization  on their behalf.
Under the terms of the  agreement,  commission  revenues are to be split equally
between the parties.

We currently have four key "strategic relationships." The first is with Humboldt
Bank of Eureka to facilitate  the issuance of merchant  accounts.  The second is
with  First  National  Bank of Omaha to  facilitate  the  issuance  of  merchant
accounts.  The third is with  En-Cynk  Services  to  facilitate  online  payment
processing  via a  payment  gateway.  The  fourth  is  with  Planet  Payment  to
facilitate multi-currency payment and settlement for merchants globally.

Digital Commerce  Merchant  Services,  Inc. did not generate  revenues in fiscal
year 1999.  The Company  hopes that during  fiscal year 2000,  Digital  Commerce
Merchant  Services,  Inc.  will  provide  a broad  array of  merchant  services,
generating fees and  commissions  from bankcard  transactions  and from sales of
bankcard processing equipment to United States and international merchants.

         Digital Commerce Inc.

Digital Commerce Inc. was incorporated on November 17, 1998 in the island nation
of Nevis and is based in the province of British  Columbia,  Canada. On June 15,
1999 the Company  acquired  this  subsidiary  through the  issuance of 5,000,000
shares of its common stock and 500,000 shares of its preferred stock in exchange
for all of the  outstanding  common stock of Digital  Commerce  Inc.  (Preferred
stock has been  approved by the board of  directors  and  shareholders,  but the
Company has not amended its Articles of  Incorporation  and the preferred shares
have not been created and registered with the State of Delaware.  The Company is
in the process of having such shares registered.)

This  subsidiary  acts  as a  sales  agent  for  organizations  engaged  in the
processing of credit card transactions for international  merchants.  Due to the
formation of additional subsidiaries, the Company is currently in the process of
liquidating this subsidiary.

         Digital Commerce Canada Ltd.

Digital  Commerce  Canada  Ltd.  was  incorporated  on October  18,  1999 in the
province  of  British  Columbia,  Canada,  where it is  based.  This  subsidiary
provides  administrative  and  technological  services  for the  Company and its
subsidiaries.

         (d)  Operations

Currently,  the Company acts as an Independent Sales Agent for  Intercontinental
Financial Services and provides  third-party,  on-line, real time processing for
international  merchants.  In the U.S.,  the  Company  is a  registered  ISO for
Humboldt bank of Eureka,  California,  and with First  National Bank of Omaha of
Omaha, Nebraska. Together with Humboldt, FNBO and its third-party providers, the
Company is able to offer U.S.  online  merchants  solutions to the challenges of
e-commerce transaction processing.  Upon completion of the initial phases of its
operation, the Company believes that its control over third-party providers will
increase,  time-to-delivery  will improve, and its operating margins will widen;
however,  all of this will be transparent  to the Company's  merchant-customers.
For them, the key benefits of the Company's anticipated services may include:

          o    Fast time-to-market.  The Company's  third-parties'  services and
               technical support may enable online merchants to begin processing
               transactions  without lengthy or costly integration  efforts. The
               Company  is  able  to do this by  combining  such  services  as a
               merchant  account,  an  internet  payment  gateway,  and  a  bank
               account, thus simplifying the process for the merchant.  Services
               are  invoked  by  a  single  common  interface,  installed  on  a
               merchant's  commerce  server.  Typically,  new  merchants  can be
               approved, have their software installed, and be operating online,
               generating  revenues  in as little as 72 hours from the time that
               their completed applications are received.

          o    Access to  comprehensive  suite of  services.  The Company may be
               able to deliver to merchants on-demand, online access to services
               that  address  a  broad   spectrum  of   e-commerce   transaction
               processing  issues  related to global payment  processing,  fraud
               prevention, tax calculation,  export compliance, delivery address
               verification, and fulfillment management.

          o    Simplify the Merchant's Operations.  The Company hopes to provide
               a suite of e-commerce  transaction  services designed to simplify
               merchants'  operations  and allow them to focus on marketing  and
               merchandising tasks required for their online businesses. Many of
               the Company's  services are designed to add value without drawing
               attention  to the  mechanics of the  provision  of that  specific
               service.

          o    Global   reach.   The   Company   hopes  to   obtain   access  to
               third-parties'  services  used by  merchants  in  many  countries
               around the  globe.  Through  them,  the  Company  hopes to obtain
               access to an established network of virtual network access points
               in various  countries on multiple  continents  including  Europe,
               Asia, South America and Australia. In addition, the Company hopes
               to be able to  support  over 100  currencies  and  provide  sales
               tax/VAT   calculations  for  all  United  States   jurisdictions,
               Canadian provinces and all countries in the European Union.

          o    Reduced  overall costs.  The Company hopes that its services will
               enable  merchants  to  effectively  process  online  transactions
               without the cost of developing and maintaining  their own complex
               transaction processing systems and infrastructure.

         (d)      Banking Regulations Generally

         International  Banking  Regulation.   Digital  Commerce  Bank  Inc.  is
currently authorized to provide international banking services through its Class
I Offshore Banking Charter obtained from the government of Saint Vincent and the
Grenadines ("Saint Vincent").  Under the International  Banks Act, 1996 of Saint
Vincent,  offshore banking business may be transacted from within Saint Vincent,
only upon obtaining a license from the Saint Vincent and the Grenadines Offshore
Finance  Authority  (the  "Authority").  The  Company's  ability to  continue to
conduct an offshore  banking  business  depends upon its ability to maintain its
license. This requires the Company to have a resident director in Saint Vincent;
to be  incorporated,  subsisting or continued  under the Companies  Act, 1994 or
under the International Business Companies Act of 1996; and to be engaged solely
in the offshore banking business.  As an offshore banking business,  the Company
is  prohibited  from  taking a  deposit  from  any  resident  of Saint  Vincent,
investing  in any  asset  which  represents  a claim  on any  resident  of Saint
Vincent,  and purchasing bonds or other  securities  issued by the Government of
Saint Vincent.

         The Company  operates under a Class I Offshore  Banking License for the
purpose of carrying on its offshore banking  business.  In order to maintain its
license the Company must have and maintain a fully  paid-up  capital of not less
than five hundred  thousand  dollars  ($500,000)  or its  equivalent  in another
currency,  or  such  greater  sum as  may be  determined  by the  Authority.  In
addition,  the Company  must have  deposited  or invested the sum of one hundred
thousand ($100,000) or its equivalent in another currency, in such manner as the
may be prescribed.

         As an  offshore  banking  business,  the Company is required to send an
annual audit to the  Authority  within three months of the end of its  financial
year.  The Company has not yet sent an annual audit to the  Authority for fiscal
year 1999 but is in the  process of having  such audit  prepared  and intends to
provide it to the Authority as soon as it has been completed.  In addition,  the
Company is required to have no fewer than two directors, who must be approved by
the Authority. The Authority could withhold the approval of its directors, which
would result in its inability to continue to do business as an offshore  banking
business in Saint Vincent.

         As an offshore  banking business under the Bank Act, the Company is not
required to pay income tax,  capital  gains tax or other direct tax to the State
of Saint Vincent or any political subdivision thereof.

         U.S. Banking Regulation.  Revisions to existing or adoption of new laws
or regulations could subject the Company to more demanding regulatory compliance
requirements and could adversely  affect its ability to conduct,  or its cost of
conducting,  business.  If the  Company is  successful  in  obtaining  a banking
charter,  it will be subject to certain  restrictions  imposed by the Federal or
State banking  regulators.  Digital  Commerce Bank, Inc. (the Company's  banking
subsidiary)  will be regulated by the FDIC.  The Company will also be subject to
various laws and  regulations  relating to commercial and consumer  transactions
generally,  such as the Uniform Commercial Code, as well as the electronic funds
transfer  rules  which are  contained  in  Regulation  E,  issued by the Federal
Reserve  Board.  Any of these  agencies,  or other  governmental  or  regulatory
authorities,  could revise existing  regulations or adopt new regulations at any
time. Legislation and regulatory  initiatives containing  wide-ranging proposals
for  altering  the  structure,   regulation  and  competitive  relationships  of
financial  institutions  are  introduced  regularly.  The Company cannot predict
whether or in what form a proposed  statute or regulation will be adopted or the
extent  to which it may  affect  its  business.  Furthermore,  given  the  rapid
expansion of the electronic commerce market, many regulatory bodies are adopting
measures  to ensure  that their  regulations  are  keeping  pace.  For  example,
Congress  has held  hearings  on whether to  regulate  the  electronic  commerce
market,  while  numerous  states  are  considering  adopting  their  own laws to
regulate  internet  banking.   Furthermore,   bank  regulators  are  considering
proposing new laws relating to customer privacy.  If enacted,  these laws, rules
and regulations  could force the Company to comply with more complex and perhaps
more burdensome regulatory requirements, which could materially adversely affect
the Company's business,  financial  condition,  results of operations,  and cash
flows.

         Internet  Regulation.  The Company's ability to conduct and/or its cost
of conducting business may also be adversely affected by a number of legislative
and regulatory  proposals  concerning  other aspects of the internet,  which are
currently under consideration by federal,  state, local and foreign governmental
organizations.  These proposals  include,  but are not limited to, the following
matters: on-line content, user privacy,  taxation, access charges,  liability of
third-party activities and jurisdiction. Moreover, the Company does not know how
existing  laws  relating to these  issues will be applied to the  internet.  The
adoption of new laws or the  application  of existing  laws could  decrease  the
growth in the use of the  internet,  which could in turn decrease the demand for
the  Company's  anticipated  products and  services,  increase its cost of doing
business, or otherwise have a material adverse effect on its business, financial
condition,  results  of  operations,  or  cash  flows.  Furthermore,  government
restrictions  on  internet  content  could slow the growth of  internet  use and
decrease  acceptance of the internet as a communications  and commercial  medium
and thereby have a material adverse effect on our business,  financial condition
and results of operations.  Some local telephone carriers have asserted that the
growing   popularity   and  use  of  the  internet  has  burdened  the  existing
telecommunications  infrastructure and caused interruptions in telephone service
in areas with high internet use.  These  carriers  have  petitioned  the Federal
Communications  Commission to impose access fees on internet  service  providers
and  commercial  on-line  service  providers.   If  the  Federal  Communications
Commission  imposes  access fees,  the costs of  transacting  business  over the
internet could increase substantially,  potentially slowing the growth in use of
the internet.  This could in turn decrease demand for the Company's  anticipated
services  or  increase  its cost of doing  business,  and thus  have a  material
adverse  effect on the  Company's  business,  financial  condition,  results  of
operations, and cash flows.

         Internet Privacy. Internet user privacy has become an issue both in the
United  States and abroad.  The Federal  Trade  Commission  has  proposed  model
legislation that would force companies to comply with specified core information
practices.  It is possible that Congress could adopt either legislation  similar
to that  proposed by the Federal Trade  Commission or other privacy  legislation
that  could have a material  adverse  effect on the way in which the  Company is
allowed to conduct its  business,  especially  those  aspects  that  involve the
collection  or use of personal  information.  At the  international  level,  the
European  Union has adopted a  directive  that  permits  European  Union  member
countries to impose  restrictions  on the  collection  and use of personal data.
This directive  could,  among other things,  affect United States companies that
collect  information over the internet from individuals in European Union member
countries  and may impose  restrictions  that are more  stringent  than  current
internet privacy  standards in the United States. In response to this directive,
on November 4, 1998,  the United  States  Department  of Commerce  published for
comment  a set of  safe  harbor  principles  regarding  privacy  protection  for
personally identifiable data. These principles were revised on April 19, 1999.

         (e)      Future Marketing Strategies

            The Company  hopes to employ a  multifaceted  marketing  strategy to
aggressively market its products and services to both domestic and international
markets.  Our marketing  strategy  will include the  following:  acquisition  of
merchant  portfolios  from an independent  sales  organization;  establishing an
internal business development/sales staff; building relationships with acquiring
banks  that  will  have  the  ability  to  resale  our  services;  and  building
relationships  with various Internet Service  Providers (web hosting  companies,
application service providers,  etc.) that will resale our services. The Company
expects its  revenue-generating  products and services to include online retail,
commercial,  and private banking services,  as well as merchant  services.  This
strategy will utilize the internet  platform as its primary means of integrating
and marketing these offerings.

            The use of the internet as the  Company's  common  delivery  channel
supports  its  commitment  to  providing  24  hours,  7 days a week  access  and
availability  of its products  and  services to its  domestic and  international
clients. To complement this, the Company anticipates using alternative  delivery
channels  including the  telephone,  automated  banking  machines and the postal
services  as a means of  increasing  the  availability  and  convenience  of its
products and services.

            The   Company   intends   to   develop  a   flagship   web  site  at
www.thatbank.com. The Company hopes that this site will serve as a comprehensive
multipurpose  hub or portal  site  providing  access to the  services  described
above.  The  Company  is  attempting  to create a site  that will be  appealing,
versatile,  and informative to its existing and potential  clients by offering a
number of complimentary  value-added services including free email accounts, web
site  personalization   features,  timely  Industry  specific  news,  investment
portfolio  tools,  and  internet  search  engine  capabilities.   The  Company's
anticipated direct marketing activities may include the use of an internal sales
force  as well as  outsourced  sales  activities  and  direct  advertising.  The
Company's  anticipated  indirect  marketing  activities would include the use of
strategic  partnership and alliance  agreements with suitable businesses as well
as co-branding activities.

            The Company  considers  its ongoing  attempts to develop and provide
complimentary  services such as those  described above to be an important to its
future growth. We anticipate that these services shall include loyalty programs,
customer  relationship   management  services,   intra-sector  comparison  sales
reporting  tools,  online  banking,  online  shopping  portal,  registration  in
multiple  portals,  micropayment,  recurring  billing,  and alternative forms of
payment  such as debit  card,  smart card,  and  e-check.  The  Company  further
anticipates  that such  services,  if the Company is able to provide them,  will
help build  customer  loyalty,  web site traffic,  and help grow its database of
subscribers, which will be integrated into its direct marketing efforts.

         (f)      Employees

         At October 31,  1999,  the Company  had 7  full-time  employees  and no
part-time  employees.  The Company considers its relations with its employees to
be excellent.  The Company's  employees are not  represented  by any  collective
bargaining  group,  and the  Company  is not  aware  of any  efforts  among  its
employees to organize.  The Company's future success depends in significant part
upon the continued service of its key technical and senior management  personnel
and its continuing ability to attract and retain highly qualified  technical and
managerial personnel.

         (g)      Competition

The  Company  believes  that the  principal  competitive  factors in the banking
industry are market presence, customer service, convenience,  interest rates and
product offerings. While the banking industry is highly competitive, the Company
believes it can compete  effectively with its principal  competitors,  which are
traditional banks,  internet banks, and other financial services providers.  The
Company  believe  that  its low cost  structure,  which  will  allow it to offer
attractive  interest rates and low fees,  gives us a competitive  advantage over
traditional banks, which must support a physical branch structure.  Furthermore,
the Company  hopes to be able to offer a broader  array of products and services
than many non-bank financial services providers.  However, most of the Company's
competitors  have larger  customer  bases,  greater name  recognition  and brand
awareness, greater financial and other resources, and longer operating histories
than the Company does. Additionally, new competitors and competitive factors are
likely to emerge,  particularly  in view of the rapid  development  of  internet
commerce.

Our key  business  is in  facilitating  payment  processing  over the  Internet.
Businesses that supply the technology to facilitate  payment processing over the
Internet are known as Payment Gateways.  Payment Gateways are our closest direct
competitors  and we estimate  that there are between 50-70 of them in the United
States.  These payment  gateways  generally fall into three  categories.  First,
those who  process  credit  cards  over the  Internet.  Second,  those who issue
Merchant Accounts (via a relationship with a Bank) and process credit cards over
the Internet.  Third,  those who process  alternative  forms of payment over the
Internet (e.g.,  electronic  check).  Our business model is based on aggregating
all the financial & payment needs of merchants plus providing  additional  value
added services.  Specifically,  we will issue Merchant Accounts,  process credit
cards over the Internet, process alternative forms of payment over the Internet,
as well as provide various banking services (via a yet to be negotiated  banking
alliance).  These banking  services will include online  banking,  multicurrency
payment and settlement,  and integrated financial statements.  Other value added
services will include loyalty program, customer relationship managment programs,
and access to a shopping portal.

In summary,  our current  business  consists of issuing  merchant  accounts  and
processing credit cards over the Internet.  In this, we currently do not have an
advantage  over many of our  competitors.  However,  no company  that we know of
presently aggregates or has the intention to aggregate the products and services
that are outlined  above.  We are working  aggresively  to  aggregate  the named
products and services for merchants and our  competitive  advantage  will become
apparent as we accomplish this


Item 2.  Description of Properties

         The  Company  occupies  2,500  square feet of  commercial  space at 815
Hornby Street, Suite 404, Vancouver,  British Columbia. The terms of the leasing
agreement are on a  month-to-month  basis,  renewable  under the same terms upon
notice. The Company's current monthly rent for this facility is US $3,100.

         The Company also occupies 2,000 square feet of commercial space at 4049
South Highland Drive,  Salt Lake City, Utah. The terms of the leasing  agreement
are on a month-to-month  basis,  renewable under the same terms upon notice. The
Company's current monthly rent for this facility is US $1,000.

         The Company maintains 2000 square feet of premises in Kingstown,  Saint
Vincent, West Indies. The terms of the leasing agreement are on a month-to-month
basis, renewable under the same terms upon notice. The Company's current monthly
rent for this facility is US $3,000.

         The  Company  believes  its office  space is  adequate  for its current
needs.

Item 3.  Legal Proceedings.

         On January 5, 2000,  the Company and Directors Kang and Combs were made
defendants  to a  lawsuit  by a  former  business  partner.  In that  case,  the
plaintiff,  the former business partner, alleged breach of a statutory duty owed
by Kang and  Combs to the  plaintiff.  He  claims  that he was not made  part of
certain  corporate  opportunities  and was not  included  in  certain  corporate
changes  and the  benefits  therefrom.  The Company  believes  the claims of the
plaintiffs  regarding the Company are without  merit.  In addition,  the Company
believes that any decision  granted in favor of the plaintiff  would only affect
the  shares  held by Kang and  Combs  and  would  not  affect  Digital  Commerce
International, Inc. directly.

Item 4.  Submission of Matters to a Vote of Security Holders.

         No  matters  were  submitted  to a vote of the  Company's  stockholders
during the fourth quarter of the fiscal year ended October 31, 1999.

<PAGE>

                                     Part II

Item 5.  Market for Registrant's Common Equity and Related Stockholder Matters

         (a)      Market Information.

         Prior to the  acquisition  of Digital  Commerce,  Inc.,  the  Company's
common stock  traded on the Nasdaq  Over-The-Counter  Bulleting  Board under the
symbol "SYAE." Systems Assurance did not have any trading volume for FY 1998 and
the first two quarters of FFY 1999. On June 17, 1999, the Company's common stock
commenced trading on the Nasdaq Over-The-Counter Bulletin Board under the symbol
"THBK".  The following table sets forth the range of high and low bid quotations
for the Company's common stock for each of the periods  indicated as reported by
the Nasdaq Over-The-Counter  Bulletin Board. Bid quotations reflect inter-dealer
prices,  without retail markup,  markdown or commission and may not  necessarily
represent actual transactions. on June 17, 1999.

                             Quarter Ended High Low

         July 31, 1999(1)             $12               $0.125
         October 31, 1999             $12               $10

     (1) For the period  commencing on June 17, 1999, and concluding on July 31,
1999.

         On  January  24,   1997,   the   Company's   stockholders   approved  a
one-for-seventy (1:70) reverse common stock split, and on December 19, 1997, the
Company's stockholders approved a one-for-five (1:5) reverse common stock split,
and changed the par value of the common  shares from $.01 to $.001.  In January,
1997,  the  Company's  stockholders  approved the  creation of three  classes of
preferred  stock,  par value $.001,  with rights and privileges to be set by the
Board of Directors.  The Board of Directors authorized 500,000 shares of Class A
Preferred  Stock on February 9, 2000.  When and if the Board declares a dividend
or distribution with respect to the then outstanding shares of Common Stock, the
holders of the Series A  Preferred  shares  shall be  entitled  to the amount of
dividends per share in an amount equal to ten times the amount,  and in the same
form, as they would have received if they held an equal number of Common Shares.
(Preferred  stock has been approved by the board of directors and  shareholders,
but the Company has not amended its Articles of Incorporation  and the preferred
shares have not been  created and  registered  with the State of  Delaware.  The
Company is in the process of having such shares registered.)

         (b)      Security Holders

         The  approximate  number of record  holders of shares of the  Company's
common stock as of October 31, 1999 was 1555.

<PAGE>

         (c)      Dividends

         The Company has not paid dividends within the last three years and does
not anticipate or contemplate  paying cash dividends in the foreseeable  future.
The Company presently intends to utilize all available funds for the development
and growth of its business and operations.

         (d)      Recent Sales of Unregistered Securities

         The Company has entered into six  transactions  in the past three years
involving the issuance of its securities under certain exempt transactions under
the Securities Act of 1933.

         On February 4, 1997,  the Company  issued  80,000  shares of its common
stock to an investment firm to in order to pay a $52,829 promissory note.

         On January 5, 1998, the Company issued  20,000,000 shares of its common
stock to its sole officer and director in exchange for services rendered.  These
shares were valued at $90,000.

          On January 9, 1998,  the Company  issued  900,000 shares of its common
stock in exchange for $9,000 cash consideration.

         On June 15,  1999,  the  Company  issued  to  Messrs.  Kang  and  Combs
5,000,000  shares  of its  common  stock  and  500,000  shares  of its  Series A
Preferred  Stock in  exchange  for all of the  issued  and  outstanding  capital
securities of Digital  Commerce Inc.  (Preferred  stock has been approved by the
board of  directors  and  shareholders,  but the  Company  has not  amended  its
Articles of  Incorporation  and the  preferred  shares have not been created and
registered  with the State of Delaware.  The Company is in the process of having
such shares registered.)

         In May and June,  1999,  the  Company  issued  l,227,500  shares of its
common  stock at a price of  $1.00  per  share,  for a total  purchase  price of
$1,227,500,  to twenty two  investors.  The Company  believes that each of these
twenty two investors was an "accredited investor."

         In February,  2000,  the Company  issued  200,000  shares of its common
stock to Theodore Swindells, for a total purchase price of $500,000.

         In connection with each of these isolated issuances of securities, each
purchaser  represented  and  warranted to the Company that it (i) was aware that
the securities  had not been  registered  under federal  securities  laws,  (ii)
acquired the securities for its own account for investment purposes and not with
a view to or for resale in connection with any  distribution for purposes of the
federal  securities  laws, (iii) understood that the securities would need to be
indefinitely held unless registered or an exemption from registration applied to
a proposed  disposition,  (iv) was aware that the certificate  representing  the
securities  would bear a legend  restricting  their transfer,  and (v) was aware
that there was no public market for the securities.  The Company  believes that,
in light of the foregoing,  and in light of the sophisticated  nature of each of
the acquirers,  the sale of its  securities to the respective  acquirers did not
constitute  the sale of an  unregistered  security in  violation  of the federal
securities  laws and  regulations  by reason  of the  exemption  provided  under
Section  4(2)  and  Regulation  S of the  Securities  Act,  and  the  rules  and
regulations promulgated thereunder.

Item 7. Management's  Discussion And Analysis Of Financial Condition And Results
Of Operations

Special Note Regarding  Forward-Looking  Statements.  Certain statements in this
report and  elsewhere  (such as in our other  filings  with the  Securities  and
Exchange Commission ("SEC"), press releases, presentations by our management and
oral statements) may constitute "forward-looking  statements" within the meaning
of  the  Private  Securities  Litigation  Reform  Act of  1995.  Words  such  as
"expects,"  "anticipates," "intends," "plans," "believes," "seeks," "estimates,"
and  "should,"  and  variations  of these  words and  similar  expressions,  are
intended to identify  these  forward-looking  statements.  The Company's  actual
results could differ materially from those anticipated in these  forward-looking
statements.  Factors that might cause or contribute to such differences include,
among others,  competitive pressures,  the growth rate of the banking,  merchant
services and electronic commerce industries,  constantly changing technology and
market  acceptance of our products and services.  The Company does not undertake
any  obligation  to  publicly  release  the  result  of any  revisions  to these
forward-looking statements, which may be made to reflect events or circumstances
after the date hereof or to reflect the occurrence of unanticipated events.

         Overview

The Company did not conduct any active  business  operations  from 1992  through
June 15,  1999.  The  Company  is a  developing  company.  It hopes to become an
internet  banking and financial  services  company,  specializing in providing a
variety of banking and financial services,  including the integration of banking
services,  both  commercial  and  private,  bankcard  processing,  and  merchant
services  with an emphasis on the internet as the common  platform for delivery.
The Company  operates  through  four  wholly  owned  subsidiaries,  two of which
generated  revenues  during  fiscal  year 1999.  In November  1999,  the Company
incorporated Digital Commerce Merchant Services,  Inc., a Delaware  corporation,
as its domestic based Independent Sales  Organization  (ISO) to provide merchant
bankcard transactions for domestic clients in settling credit card transactions.
In the future,  the Company hopes to establish  domestic banking  operations and
hopes to offer a full range of retail banking services.

         Results of Operations

         The  Company  earned  operating  revenues of $255,000 in the year ended
October 31st, 1999. These revenues  consisted  primarily of commission  revenues
from the  Company's  role as a sales  agent for credit  card  transactions.  The
Company  received  $190,000 of such revenues  through its issuance of a merchant
numbers and $65,000 of such revenues as commissions  received in its capacity as
sales  agent  for  organizations  engaged  in  the  processing  of  credit  card
transactions  for  international  merchants.  The Company  hopes to recognize an
increase  in  commission  revenue  in the future  due to the  establishment  and
integration  of its  operating  divisions  together  with  increased  sales  and
marketing efforts.

         Operating Expenses

         The Company's  operating  expenses have increased in each quarter since
its  acquisition of Digital  Commerce Inc. in June,  1999. The Company  believes
that  operating  expenses will continue to increase in the future as the Company
continues to develop, implement, and deploy its services and operations.

         General and administrative expenses for the year ended October 31, 1999
totaled  $806,861.  General  and  administrative  expenses  for  the  year  were
comprised   primarily  of   compensation   for   personnel,   fees  for  outside
professionals, telecommunications, bank licensing fees and other overhead costs,
including travel and entertainment expenses.

         Liquidity and Capital Resources

         The  Company   financed  its  operations   primarily   through  private
placements  of its common stock which  provided  net  proceeds of  approximately
$1,227,500.  At October 31st,  1999, the Company had  approximately  $431,000 in
cash and cash  equivalent  in  short-term  investments.  The Company has no debt
facilities.

         The Company has no material  commitments,  other than those  employment
agreements  described elsewhere herein. The Company hopes to realize an increase
in its working  capital,  and anticipates a substantial  increase in its capital
expenditures due to the anticipated expansion of its business units, in the year
2000.

         Net cash used by  operating  activities  during the year ended  October
31st, 1999 was $769,000.  The Company's  principal uses of cash were to fund its
net loss from  operations and to finance the increases in receivables  and other
assets.

         Net  cash  used by  investing  activities  consisted  of  $27,535  paid
principally for acquisition of capital assets.

         Net cash  provided  by  financing  activities  was  $1,227,500  derived
primarily from capital contributions.  Of the capital contributions,  $1,227,500
was recorded from private sales of restricted stock.

         Management  believes  that the  combination  of  revenues  and  capital
contributions  will be sufficient  to fund  operations  for the upcoming  fiscal
year. To the extent that the Company  requires  additional  funds to support its
operations  or the expansion of its  business,  the Company may sell  additional
equity, issue debt, or obtain credit facilities through financial  institutions.
Any  sale of  additional  equity  securities  will  result  in  dilution  to the
Company's stockholders.  There can be no assurance that additional financing, if
required,  will be available to the Company in amounts or on terms acceptable to
us. If the Company is unable to secure additional financing,  our operating will
be  adversely  affected and are  likelihood  of success  could be  significantly
impaired.

         Impact of Inflation

         The impact that  inflation  may have upon the Company  differs from the
potential impact of inflation upon an industrial company,  because substantially
all of the  Compay's  assets and  liabilities  will be monetary  in nature,  and
interest  rates and inflation  rates do not always move in concert.  The Company
believes  that the impact of  inflation on  financial  results  depends upon its
ability to manage interest rate sensitivity and, by such management,  reduce the
inflationary  impact upon  performance.  The most  direct  impact of an extended
period of  inflation  would be to increase  interest  rates and to place  upward
pressure on the Company's operating expenses.  The actual effect of inflation on
the Company's net interest income,  however, would depend on the extent to which
the  Company was able to  maintain a spread  between  the  average  yield on its
interest-earning   assets  and  the   average   cost  of  its   interest-bearing
liabilities,  which  would  depend  to a  significant  extent  on the  Company's
asset-liability sensitivity. As discussed above, the Company will seek to manage
the relationship  between  interest-sensitive  assets and liabilities to protect
against  wide  interest  rate  fluctuations,   including  those  resulting  from
inflation.  The effect of inflation on the Company's  results of operations  for
the past three years has been minimal.

         Year 2000 Issue

         Many existing computer programs, hardware, and peripherals use only two
digits to identify a year in the date field.  These  programs  and systems  were
designed  without  considering the impact of the upcoming change in the century.
If not corrected,  these computer  applications and systems could fail or create
erroneous  results  by,  at, or after the year  2000.  Based on the  preliminary
review of the computer programs the Company currently uses,  management does not
anticipate  that the  Company  will  incur  material  operating  expenses  or be
required to incur  material costs to be year 2000  compliant.  To the extent the
Company's  systems are not fully year 2000 compliant,  there can be no assurance
that potential systems interruptions or the cost necessary to update software or
hardware would not have a material effect on its business,  financial condition,
results of operations, or business prospects. In addition, in the event that the
Company's significant suppliers do not successfully and timely achieve year 2000
compliance, its business or operations could be adversely affected.

Item 7A.  Quantitative and Qualitative Disclosures about Market Risk.

Reference  is  made  to  "Interest  Rate  Sensitivity  Management"  in  Item  7,
Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
Operations.

Item 8.           Financial Statements and Supplementary Data.



<PAGE>

              DIGITAL COMMERCE INTERNATIONAL, INC. AND SUBSIDIARIES

                 CONSOLIDATED FINANCIAL STATEMENTS AND REPORT OF
                    INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

                                OCTOBER 31, 1999

<PAGE>

                                                  C O N T E N T S


                                                                   Page

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS                   1

CONSOLIDATED FINANCIAL STATEMENTS

    BALANCE SHEET                                                   3
    STATEMENT OF OPERATIONS                                         4
    STATEMENT OF STOCKHOLDERS' EQUITY                               5
    STATEMENT OF CASH FLOWS                                         6
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS                      7



<PAGE>

                              REPORT OF INDEPENDENT
                          CERTIFIED PUBLIC ACCOUNTANTS

The Directors and Stockholders of
Digital Commerce International, Inc.


         We have audited the accompanying  consolidated balance sheet of Digital
Commerce  International,  Inc. and  Subsidiaries as of October 31, 1999, and the
related  consolidated  statements of operations,  stockholders'  equity and cash
flows for the period from  November  17, 1998  (inception)  through  October 31,
1999.  These  financial  statements  are  the  responsibility  of the  Company's
management.  Our  responsibility  is to  express  an  opinion  on the  financial
statements based on our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards  require that we plan and perform the audit to obtain reasonable
assurance   about  whether  the  financial   statements  are  free  of  material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material respects, the consolidated financial position of Digital
Commerce  International,  Inc. and  Subsidiaries as of October 31, 1999, and the
consolidated  results of their operations and their  consolidated cash flows for
the period from  November 17, 1998  (inception)  through  October 31,  1999,  in
conformity with generally accepted accounting principles.

Salt Lake City, Utah
January 14, 2000

<PAGE>

                        CONSOLIDATED FINANCIAL STATEMENTS

<PAGE>
<TABLE>
<CAPTION>

              Digital Commerce International, Inc. and Subsidiaries

                           CONSOLIDATED BALANCE SHEET

                                October 31, 1999

                                     ASSETS

Current assets
<S>                                                                       <C>             <C>
    Cash                                                                                  $      430,803
    Accounts receivable, no allowance deemed necessary (Note G)
       Trade                                                                                     244,358
       Other                                                                                       9,099
    Receivable from shareholders                                                                  18,587
                                                                                           --------------

             Total current assets                                                                702,847


equipment, at cost                                                        $       27,535
    Less accumulated depreciation                                                 (7,083)         20,452
                                                                           --------------

DEPOSITS                                                                                         203,731
                                                                                           --------------
                                                                                          $      927,030
                                                                                           ==============


                      LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities
    Trade accounts payable                                                                $      177,891
    Accrued liabilities                                                                           73,587
                                                                                           --------------
             Total current liabilities                                                           251,478


COMMITMENTS AND CONTINGENCIES (Notes C and E)                                                          -

STOCKHOLDERS' EQUITY (Notes B, E and I)
    Preferred stock to be issued                                          $            -
    Common stock, $0.001 par value; 30,000,000 shares
      authorized, 12,967,500 shares issued and outstanding                        12,967
    Additional paid-in capital                                                 1,214,404
    Accumulated deficit                                                         (551,819)
                                                                           --------------

             Total stockholders' equity                                                          675,552
                                                                                           --------------

                                                                                          $      927,030
                                                                                           ==============
</TABLE>
                     The accompanying notes are an integral
                             part of this statement.

                                        3

<PAGE>
<TABLE>
<CAPTION>

              Digital Commerce International, Inc. and Subsidiaries

                      CONSOLIDATED STATEMENT OF OPERATIONS

      For the period November 17, 1998 (inception) through October 31, 1999

<S>                                                                                       <C>           <C>
Revenues                                                                                                $    255,042

Operating expenses

    Salaries                                                                              $   198,654
    Professional services                                                                     195,425
    Travel                                                                                     97,842
    Licensing fees                                                                             92,300
    Occupancy and telecommunications                                                           50,230
    Advertising                                                                                21,919
    Depreciation and amortization                                                              15,873
    Website                                                                                    11,691
    Other                                                                                     122,928        806,861
                                                                                           -----------   ------------
             Loss before income taxes                                                                       (551,819)

Income taxes (Note F)                                                                                              -
                                                                                                         ------------
             NET LOSS                                                                                   $   (551,819)
                                                                                                         ============

Loss per common share (Note D)
    Basic                                                                                               $      (0.06)
    Diluted                                                                                                    (0.06)

Weighted-average common and dilutive
   common equivalent shares outstanding
    Basic                                                                                                  9,111,579
    Diluted                                                                                                9,111,579
</TABLE>






         The accompanying notes are an integral part of this statement.

                                        4

<PAGE>
<TABLE>
<CAPTION>

              Digital Commerce International, Inc. and Subsidiaries

                 CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY

   For the period from November 17, 1998 (inception) through October 31, 1999




                                                         Common stock            Additional
                                                  -------------------------       paid-in      Accumulated
                                                     Number         Amount        capital         deficit         Total
                                                  ------------    ---------    ------------   --------------   ----------
<S>                                               <C>            <C>          <C>            <C>              <C>
Balance at November 17, 1998 (inception)                    10   $       -    $       371    $           -    $      371

Recapitalization of Company (Note B)                11,739,990      11,740        (12,240)               -          (500)

Issuance of common stock for cash                    1,227,500       1,227      1,226,273                -     1,227,500

Net loss                                                     -           -              -         (551,819)     (551,819)
                                                  ------------    ---------    ------------   --------------   ----------

Balance at October 31, 1999                         12,967,500   $  12,967    $ 1,214,404    $    (551,819)   $  675,552
                                                  ============    =========    ============   ==============   ==========
</TABLE>







         The accompanying notes are an integral part of this statement.

                                        5

<PAGE>

              Digital Commerce International, Inc. and Subsidiaries

                      CONSOLIDATED STATEMENT OF CASH FLOWS

   For the period from November 17, 1998 (inception) through October 31, 1999


Increase (decrease) in cash
    Cash flows from operating activities
       Net loss                                                 $   (551,819)
       Adjustments to reconcile net loss to net cash
         used in operating activities
             Depreciation and amortization                            15,873
             Changes in assets and liabilities
              Accounts receivable                                   (253,457)
              Receivable from shareholders                           (18,587)
              Deposits                                              (203,731)
              Accounts payable                                       168,972
              Accrued liabilities                                     73,587
                                                                -------------
                  Total adjustments                                 (217,343)
                                                                -------------

                  Net cash used in
                    operating activities                            (769,162)

    Net cash flows from investing activities -
       Purchase of property and equipment                            (27,535)

    Cash flows from financing activities
       Proceeds from issuance of common stock                      1,227,500
                                                                -------------
                  Net increase in cash                               430,803

Cash at beginning of period                                                -
                                                                -------------
Cash at end of period                                           $    430,803
                                                                =============

Supplemental disclosures of cash flow information

    The Company did not pay interest expense or income taxes during 1999.

Noncash investing and financing activities

    On  June  15,  1999,  the  Company  acquired  Digital  Commerce,  Inc.  in a
    transaction accounted for as a reverse acquisition (Note B).





         The accompanying notes are an integral part of this statement.

                                        6

<PAGE>

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

                  A summary of the significant  accounting policies consistently
applied in the preparation of the accompanying financial statements follows.

1.       Organization and business activity

                  Digital  Commerce   International  Inc.  (the  Company)  is  a
Delaware  corporation  that has been inactive from October 31, 1991 through June
15, 1999.  On June 15, 1999 the Company  acquired  Digital  Commerce  Inc.  This
acquisition was accounted for as a reverse  acquisition (Note B). The Company is
headquartered  in  Vancouver,   Canada  and  currently   processes  credit  card
transactions.  One  subsidiary,  Digital  Commerce Bank,  Inc.,  holds a class I
banking license in St. Vincent and the Grenadines.

2.       Principles of consolidation

                  The consolidated  financial statements include the accounts of
the Company and its wholly owned  subsidiaries,  Digital Commerce Inc.,  Digital
Commerce Bank, Inc.,  Digital Commerce Canada Ltd. and MBS Acquisition  Corp. On
January 6, 2000,  MBS  Acquisition  Corp.  changed its name to Digital  Commerce
Merchant Services, Inc. (d.b.a.  "Bankthat.com").  All significant  intercompany
accounts and transactions have been eliminated in consolidation.

       3.   Use of estimates

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

       4.   Cash and cash equivalents

       The Company  considers all highly liquid debt  instruments  with original
       maturity  dates  of  three  months  or less  when  purchased,  to be cash
       equivalents.

       5.   Revenue recognition

       The Company  recognizes  transaction  processing  revenues  and  merchant
       set-up fees as the related services are performed.

       6.   Depreciation and amortization

       Depreciation  of property and equipment is provided on the  straight-line
       method over the estimated useful lives of the assets of two years.

<PAGE>

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED

       7.   Fair value of financial instruments

       The  carrying   value  of  the  Company's   accounts  and  related  party
       receivables,  accounts payable and accrued liabilities  approximate their
       fair values.

       8.   Income taxes

       The Company utilizes the liability method of accounting for income taxes.
       Under the  liability  method,  deferred  tax assets and  liabilities  are
       determined based on differences between financial reporting and tax bases
       of assets and  liabilities  and are measured  using the enacted tax rates
       and laws that will be in effect,  when the  differences  are  expected to
       reverse. An allowance against deferred tax assets is recorded, when it is
       more likely than not that such tax benefits will not be realized.

       9.   Advertising costs

       Advertising and marketing costs are expensed as incurred.

       10.  Net earnings (loss) per share

       Basic  earnings  (loss) per common  share (BEPS) is based on the weighted
       average number of common shares outstanding  during each period.  Diluted
       earnings  (loss)  per  common  share  are  based  on  shares  outstanding
       (computed as under BEPS) and dilutive potential common shares.  Potential
       common  shares  included  in  the  dilutive  earnings  (loss)  per  share
       calculation include stock options awarded.

NOTE B - RECAPITALIZATION

       In June  1999  the  Company  changed  its  name  from  Systems  Assurance
       Corporation to Digital Commerce  International  Inc. On June 15, 1999 the
       Company acquired Digital Commerce Inc. (DCI), a Nevis  Corporation  based
       in Vancouver, Canada. DCI was originally formed on November 17, 1998. DCI
       was acquired  through the issuance of 5,000,000  shares of the  Company's
       common stock and 500,000 shares of the Company's  preferred  stock to the
       shareholders of DCI in exchange for all of the  outstanding  common stock
       of DCI.  Preferred  stock has been approved by the board of directors and
       shareholders,   but  the  Company   has  not  amended  its   Articles  of
       Incorporation  and  the  preferred  shares  have  not  been  created  and
       registered  with  the  State  of  Delaware.   The  acquisition  agreement
       indicates  that each  preferred  share will carry 10 votes at shareholder
       meetings,   and  will  have  the  same  rights  to  dividends  and  other
       distributions  as a common  share.  Once the Company has  achieved  gross
       transaction volume of $240 million (the "Trigger Event"),  each preferred
       share will be  convertible  at the  option of its  holder  into 10 common
       shares.  The conversion  right will expire if the "Trigger Event" has not
       occurred  by  the  end of  the  Company's  second  complete  fiscal  year
       following the acquisition.

<PAGE>

NOTE B - RECAPITALIZATION - CONTINUED

       Upon issuance of the preferred stock,  certain  reclassifications  may be
       made within the stockholders'  equity section to reflect the terms of the
       preferred stock issued.

       The  combination  of Digital  Commerce  International  Inc.  and  Digital
       Commerce Inc. was recorded as a reverse  acquisition of Digital  Commerce
       International  Inc.  As such,  the  historical  financial  statements  of
       Digital Commerce, Inc., the accounting acquirer, are presented. After the
       reverse  acquisition  there  were -  11,740,000  shares of  common  stock
       outstanding  with  approximately 57 percent of those shares being held by
       former stockholders of the Company.

NOTE C - COMMITMENTS AND CONTINGENCIES

       1.     Employment agreements

       The  Company  has  employment  agreements  with  certain  officers of the
       Company.  Total  salaries  covered  by  these  agreements  increase  from
       $250,000 in the first year to  $450,000  annually  over five  years.  The
       agreements are exclusive of bonuses,  benefits,  and other  compensation.
       The agreements may be modified until a secondary  offering of the Company
       is completed and the Company  receives funds totaling  $20,000,000 or the
       Company achieves a market  capitalization  of $150,000,000.  The modified
       salary would be $10,000 a month with a deferral of the remaining  balance
       until the underwriting or market capitalization occur.

       2.     Litigation

       The Company is engaged in certain  litigation  in the ordinary  course of
       business. In the opinion of management, based upon the advice of counsel,
       the ultimate outcome of this litigation should not have a material impact
       on its financial position.

<TABLE>
<CAPTION>

NOTE D - LOSS PER COMMON SHARE

                  The following  data show the shares used in computing loss per
common share including dilutive potential common stock.

           <S>                                                                         <C>
           Common shares outstanding during the entire period                                 6,740,010
           Weighted-average common shares issued during the period                            2,371,569
                                                                                       -----------------
           Weighted-average number of common  shares used in basic EPS                        9,111,579

           Dilutive effect of options                                                                 -
                                                                                       -----------------
           Weighted-average number of common shares and dilutive potential common
              stock used in diluted EPS                                                       9,111,579
                                                                                       =================
</TABLE>



<PAGE>

NOTE D - LOSS PER COMMON SHARE - CONTINUED

                  Shares from the exercise of the  outstanding  options (Note E)
were not included in the  computation  of diluted loss per share  because  their
inclusion would have been antidilutive for the period ended October 31, 1999.

NOTE E - OPTIONS

       During  1999,  the board of directors  approved a stock option plan.  The
       maximum  number of shares of common  stock  that may be issued  under the
       plan  is  4,000,000  shares.  All  employees,   directors,  officers  and
       consultants  of the Company are eligible.  Awards of options are given to
       eligible  participants  at the  discretion  of the board of directors and
       will be based on present  and  potential  contributions  of a  particular
       individual  to the success of the Company  and other  factors,  which the
       Board may deem proper and relevant. The plan is a non-qualified plan, and
       the options granted thereunder are non-qualified stock options.

                  Under  the  plan,   options  vest  in  the  following  manner:
         directors and advisory  board members vest 50 percent upon grant and 50
         percent one year after grant date,  senior officers,  to vice president
         vest three percent at the end of each  calendar  month from grant date,
         employees  vest nine percent at the end of the later of the first three
         months or the stated  probation  period and three percent at the end of
         each calendar  month  thereafter.  Other holders vest 10 percent at the
         end of  the  first  30  days  of  their  engagement,  20  percent  upon
         completion of 50 percent of the term, where there is a particular term,
         or upon 50 percent of the project  completion,  where project specific,
         and  the  remainder  upon  completion,  and  for a  period  of 90  days
         thereafter.

                  Options  granted  to an  officer,  director,  or more  than 10
         percent  shareholder of the Company shall not become  exercisable until
         at least six months following the date of grant.

                  The Company has granted options to purchase  1,530,000  shares
         of  the  Company's  common  stock.

The  options  were  granted  to the following:

                                                                        Shares
                                                                    ------------

   Advisory board                                                        100,000

   Executive officers, including officers who are directors            1,150,000

   Other employees                                                       280,000
                                                                    ------------
                                                                       1,530,000
                                                                    ============



<PAGE>

NOTE E - OPTIONS - CONTINUED

       The Company has  adopted  only the  disclosure  provisions  of  Financial
       Accounting  Standard No. 123,  "Accounting for Stock-Based  Compensation"
       (FAS 123).  Therefore,  the Company  continues to account for stock based
       compensation  under  Accounting  Principles  Board  Opinion No. 25, under
       which no compensation cost has been recognized. Had compensation cost for
       the stock based compensation been determined based upon the fair value of
       the awards at the grant date consistent  with the methodology  prescribed
       by FAS 123,  the  Company's  net loss and loss per share  would have been
       increased to the following pro forma amounts:

       Net loss                           As reported           $  (551,819)
                                          Pro forma                (607,324)
       Loss per share - basic and
         diluted                          As reported                 (0.06)
                                          Pro forma                   (0.07)



       The fair value of these  options was estimated at the date of grant using
       the  modified  Black-Scholes  American   option-pricing  model  with  the
       following  weighted-average  assumptions for 1999: expected volatility of
       52 percent; risk-free interest rate of 5.75 percent; and expected life of
       10 years. The weighted-average fair value of options granted was $0.68.

       Option pricing models require the input of highly subjective  assumptions
       including  the  expected  stock price  volatility.  Also,  the  Company's
       employee stock options have characteristics  significantly different from
       those of traded options,  and changes in the subjective input assumptions
       can materially  affect the fair value estimate.  Management  believes the
       best input assumptions  available were used to value the options and that
       the resulting option values are reasonable.
<TABLE>
<CAPTION>

       Changes in the Company's stock options are as follows:

                                                                                                    Weighted-
                                                                                                     average
                                                                   Stock           Exercise          exercise
                                                                  options            price            price
                                                               -------------   ----------------   -------------
         <S>                                                   <C>            <C>                <C>
         Outstanding at November 1, 1998                                  -   $           -      $       -
             Granted                                              1,530,000       0.50 - 3.00          0.68
             Exercised                                                    -               -              -
             Canceled or expired                                          -               -              -
                                                               -------------
         Outstanding at October 31, 1999                          1,530,000      0.50 - 3.00           0.68
                                                               =============

         Exercisable at October 31, 1999                             83,600   $0.50 - 3.00       $     1.80
                                                               =============
</TABLE>


<PAGE>

NOTE E - OPTIONS - CONTINUED
<TABLE>
<CAPTION>

       A summary of the status of the options  outstanding  under the  Company's
       stock option plan at October 31, 1999 is presented below:

                                                           Weighted-
                                                            average       Weighted-                   Weighted-
                                                           remaining       average                    average
                                               Number     contractual     exercise       Number       exercise
              Range of exercise prices      outstanding   life (years)      price     exercisable       price
                                           ------------   ------------   ----------   -----------   -----------
              <S>                          <C>            <C>            <C>          <C>           <C>

              $ 0.50                         1,420,000        1.69         $ 0.50         40,000       $ 0.50
                3.00                           110,000        1.69           3.00         43,600         3.00
                                           ------------                               -----------

              $ 0.50 - $3.00                 1,530,000                                    83,600
                                           ============                               ===========
</TABLE>


NOTE F - INCOME TAXES

                  The Company has sustained a net  operating  loss in the period
presented.  There were no deferred tax assets or income tax benefits recorded in
the  financial  statements  for  net  deductible  temporary  differences  or net
operating  loss  carryforwards  because the  likelihood  of  realization  of the
related tax benefits cannot be established.  Accordingly,  a valuation allowance
has been recorded to reduce the net deferred tax asset to zero and consequently,
there is no income tax  provision  or  benefit  for the  period  presented.  The
increase in the  valuation  allowance  was $122,365 for the period ended October
31, 1999.

                  As of October 31,  1999,  the Company had net  operating  loss
carryforwards  for tax reporting  purposes of approximately  $385,000 in various
taxable  jurisdictions.  The  taxable  jurisdictions,  estimated  net  operating
losses,  and expiration  dates are as follows:  United States,  $345,000,  2019,
Canada,  $40,000,  2006.  Utilization of approximately  $39,000 of the total net
operating  loss is dependent  on the  profitable  operation of Digital  Commerce
International, Inc. in the future under the separate return limitation rules and
limitations  on the  carryforward  of net  operating  losses  after a change  in
ownership according to the US Internal Revenue Code.

                  Income  tax  expense  differs  from the  amounts  computed  by
applying the U.S.  Federal  income tax rate of 34 percent to pretax  income from
continuing operations as a result of the following:

        Computed tax benefit                                      $    (187,618)
        Foreign net operating losses with no current tax benefit         65,253
        Change in valuation allowance                                   122,365
                                                                   -------------

                                                                  $           -
                                                                   =============



<PAGE>

NOTE F - INCOME TAXES - CONTINUED

           Deferred income tax assets and liabilities are as follows:

   Deferred tax assets

     Benefit of net operating loss carryforwards - U.S.          $      117,584
     Benefit of net operating loss carryforwards - Foreign               18,144
                                                                  --------------
                                                                        135,728

   Less valuation allowance                                            (135,728)
                                                                  --------------

   Net deferred tax asset (liability)                            $            -
                                                                  ==============


         NOTE G - CONCENTRATIONS AND PRIMARY CUSTOMERS

       The Company's financial  instruments that are exposed to concentration of
       credit risk consist primarily of accounts receivable.

               Approximately  96 percent  of  accounts  receivable  are with two
different  customers.  The Company routinely evaluates the financial strength of
its customers and monitors each account to minimize the risk of loss.

       The Company has two  customers  which account for more than 10 percent of
       revenues.  The Company's major customers and revenue  received  therefrom
       are as follows:

                  Company A                        $     190,000
                  Company B                        $      59,742


NOTE H - BUSINESS SEGMENTS

               The  Company has two  reportable  segments  for the period  ended
October  31,  1999,  namely  processing  services  and  banking  services.   The
accounting  policies  of the  segments  are the same as those  described  in the
summary of significant accounting policies. The Company evaluates performance of
each segment based on earnings or loss from operations.  Identifiable  assets by
segment  are  reported  below.  The  Company   allocates   certain  general  and
administrative expenses, consisting primarily of management and utilities.

<TABLE>
<CAPTION>
                                                                    Processing       Banking      Consolidated
                                                                   services       services         balance
                                                                -------------   ------------   --------------
         <S>                                                   <C>             <C>            <C>

         Revenues                                              $     255,042   $         -    $      255,042
         Operating loss                                             (132,028)   (45,947)            (177,975)
         Administration expense                                            -    -                   (373,844)
                                                                                               --------------
                                                                                               --------------

             Net loss                                                                         $     (551,819)
                                                                                               ==============
</TABLE>


<PAGE>

NOTE H - BUSINESS SEGMENTS - CONTINUED
<TABLE>
<CAPTION>

       Identifiable assets
                                                    Processing       Banking                    Consolidated
                                                     services       services      Corporate        balance
                                                   ------------   ------------   -----------   --------------
          <S>                                     <C>            <C>            <C>           <C>
          Current assets                          $   206,036    $    69,122    $   237,690   $      512,848
          Non-current assets                          290,000        103,730              -          393,730
          Capital assets                               10,450              -         10,002           20,452
                                                   ------------   ------------   -----------   --------------
             Total assets                         $   506,486    $   172,852    $   247,692   $      927,030
                                                   ============   ============   ===========   ==============
</TABLE>


NOTE I - SUBSEQUENT EVENTS

       In 2000, the Company  initiated two private  placements.  The Company has
       received  approximately  $500,000  toward the purchase of 200,000  common
       shares at $2.50 per share.  The Company has also  received  approximately
       $195,000 toward the purchase of 50,000 common shares at $3.00 per share.

<PAGE>

Item  9.  Changes  In and  Disagreements  with  Accountants  on  Accounting  and
Financial Disclosure

On December 6, 1999, the Company's Board of Directors  authorized the engagement
of Grant  Thornton  LLP ("GT") as its auditor for the fiscal year ended  October
31, 1999. ThE decision to change  accountants  was prompted by the ability of GT
to provide audit services to the Company on an  international  scale. GT entered
into an engagement  letter with the Company on December 7, 1999 and concurrently
with that engagement,  the Company  dismissed  Crouch Bierwolf & Chisholm,  P.C.
("Crouch Bierwolf"),  which had served as the Company's independent  accountants
since 1998, as its auditor within the meaning of Item 304(a)(1)(i) of Regulation
S-K of the Securities and Exchange Commission.

         The reports of Crouch  Bierwolf on the financial  statements for fiscal
year 1998  contained no adverse  opinion or  disclaimer  of opinion and were not
qualified or modified as to uncertainty,  audit scope, or accounting principles.
The Board of  Directors  participated  in and  approved  the  decision to change
independent accountants.  In connection with its audit for the fiscal year ended
1998,  and through  December 6, 1999,  there were no  disagreements  with Crouch
Bierwolf  on  any  matter  of  accounting  principles  or  practices,  financial
statement disclosure, or auditing scope or procedure, which disagreements if not
resolved  to the  satisfaction  of Crouch  Bierwolf  would  have  caused  Crouch
Bierwolf to make reference  thereto in their report on the financial  statements
for such year.  During the fiscal  year ended  October  31,  1998,  and  through
December  6, 1999,  there were no  reportable  events as that term is defined in
Item 304 (a)(1)(v)of Regulation S-K.

         During the fiscal year ended October 31, 1998, and through  December 6,
1999,  the  Company  had  not  consulted  with  GT  regarding  either:  (i)  the
application  of  accounting  principles  to  a  specified  transaction,   either
completed  or proposed,  or the type of audit  opinion that might be rendered on
the Company's financial statements, and neither a written report was provided to
us nor oral  advice was  provided  that GT  concluded  was an  important  factor
considered  by us in  reaching  a decision  as to the  accounting,  auditing  or
financial  reporting  issue; or (ii) any matter that was either the subject of a
disagreement,  as that term is defined in Item 304  (a)(1)(iv) of Regulation S-K
and the related  instructions  to Item 304 of  Regulation  S-K, or a  reportable
event, as that term is defined in Item 304 (a) (1) (v) of Regulation S-K.

                                    Part III

Item 10.  Directors and Executive Officers of the Registrant

         The Company's  directors,  executive officers and key employees,  as of
the date hereof,  and their respective ages and positions with the Company,  are
set forth  below.  Biographical  information  for each of the senior  management
members and directors is also presented below. There are no family relationships
between or among any of the  Company's  directors  or  executive  officers.  The
Company's  board of directors is currently  comprised of two members.  Executive
officers are chosen by, and serve at the discretion of, the board of directors:

         (a)      Directors and Executive Officers

MICHAEL Y. H. KANG - CHAIRMAN,  CHIEF EXECUTIVE  OFFICER AND PRESIDENT.  Michael
Y.H.  Kang,  39, a resident of  Vancouver,  British  Columbia,  is the Company's
Chairman and Chief  Executive  Officer,  and is a cofounder of Digital  Commerce
Inc.,  which the Company  acquired in June,  1999. Born in Korea, Mr. Kang spent
his early  years in Korea and  Brazil,  then moved to Toronto  where he earned a
Bachelor of Commerce degree from the University of Toronto in 1981. He was hired
by  Continental  Illinois  National  Bank and Trust  Company  of  Chicago to the
position of foreign  exchange  trader and credit  analyst,  stationed  in Seoul,
Korea.  Subsequently,  Mr.  Kang  returned  to Canada to assume the  position of
General  Manager of his family's  chain of convenience  stores.  When the stores
were eventually  sold, Mr. Kang moved to Phoenix,  Arizona and purchased  Prisma
Graphics  Inc., a sheet feed printer in the State of Arizona.  In 1995, Mr. Kang
returned  to  Vancouver  to  co-found  several  private  investment  and capital
management  firms,  subsequently  leading to the development of Digital Commerce
International, Inc.

         Mr.  Kang's  term of office  as a  director  is until  the next  annual
meeting of stockholders. He has served as a director since June 15, 1999.

JOHN W. COMBS - DIRECTOR,  EXECUTIVE VICE  PRESIDENT AND SECRETARY.  Jack Combs,
54, a resident  of  Vancouver,  British  Columbia,  is the  Company's  Executive
Vice-President and Secretary and is a co-founder of Digital Commerce Inc., which
the Company acquired in jUNE,  1999. In  collaboration  with Mr. Kang, Mr. Combs
co-founded  several  private  investment and capital  management  firms and is a
shareholder  in Combs Group,  a family  commercial  real estate  corporation  in
Toronto.  He is also the owner of Brockton  Realty Inc., a Vancouver  based real
estate and  development  Company  which has been  involved  in all phases of the
development process, including planning,  financing,  development,  construction
management and  marketing.  Born in New York, Mr. Combs moved with his family to
Toronto where he earned a Bachelor of Arts degree from the University of Toronto
in  1969.  Prior  to  joining  Mr.  Kang in the  founding  of  Digital  Commerce
International  Inc.  Mr.  Combs has been active in the real  estate  development
business in Ontario and British Columbia since the early 1970's. Throughout this
time Mr. Combs has developed for his own and investors' interests and maintained
a high level of contract  services for such  companies  as Quadrant  Development
Corp., a division of Weyerhauser Canada Ltd. and Webb & Knapp Canada Ltd.

         Mr.  Combs'  term of office  as a  director  is until  the next  annual
meeting of the Company's  stockholders.  He has served as a director  since June
15, 1999.

         (b)      Advisory Board

         The Company has formed an advisory  board for the purpose of  assisting
it in the  identification  of  market  and  product  development  opportunities,
reviewing with management the progress of its specific projects,  recruiting and
evaluating its management and operational systems and, in general, assisting the
Company in its regulatory and strategic planning.  Members of the advisory board
are leaders in the fields of  business,  banking,  and  internet  commerce,  and
generally meet with the Company's management on an informal basis.

         Andrew G. Smith,  28, has served on the  advisory  board of the Company
since June 1999. He has been the President of  DietSmart.com  since  November of
1999.  DietSmart.com  is a leading  online weight loss and fitness  destination,
offering consumers diet and fitness programs tailored to their individual needs.
Prior  to  founding   DietSmart.com,   Mr.  Smith  was  the  Vice  President  of
Sponsorships and Strategic  Development for iVillage.com,  a top 25 site and the
number one women's  network on the  internet.  Mr. Smith was  responsible  for a
number of the iVillage's largest strategic  relationships,  including those with
AT&T,  Visa, First USA, and PNC Bank. He holds a B.A. in Religion from Dartmouth
College, 1994.

         George  Reznik,  34, has served on the Company's  advisory  board since
June 1999. He is currently the Director of Finance,  Pivotal Corporation,  where
he is responsible for all finance  activities for Pivotal  including  regulatory
filings,  preparation of financial  information,  business plans and budgets and
treasury  management  functions.   Mr.  Reznik  was  instrumental  in  Pivotal's
successful initial public offering on the Nasdaq Stock Market on August 5, 1999.
Prior to joining  Pivotal in early 1999,  Mr. Reznik was a Senior Manager in the
Corporate Finance practice with Deloitte & Touche leading the business valuation
practice based from the Vancouver  office in Canada.  Mr. Reznik has significant
international   corporate   finance   experience   having   worked  on  numerous
international  projects  in various  industries.  Mr.  Reznik has a Bachelor  of
Commerce  Degree  (Honours)  from the  University  of Manitoba  (1988) and was a
medallist in obtaining his Chartered  Accountant ("CA") designation in 1990. Mr.
Reznik also obtained the Chartered  Business  Valuator  ("CBV")  designation  in
1995.

         Brian Flynn, 30, has served on the Company's advisory board since June,
1999. He has nine years of experience in marketing and communications, including
product development, branding, advertising/public relations, database marketing,
and interactive  communications.  Brian has been the Chief Executive  Officer of
Annotate.net, an internet company that develops software to enhance and simplify
the web user experience,  since August, 1999. Prior to joining Annotate.net,  he
was a Senior Vice President,  Management Director at Foote, Cone & Belding (FCB)
in New York, a top worldwide advertising and communications  company. During the
previous  three  years,   Brian  was  Vice  President,   Director  of  Marketing
Communications  for  Citibank in North  America.  Brian  developed  and launched
Citibank's internet Banking product. He also serves as the Marketing Advisor for
SOHOnet, a provider of web content management solutions. Brian holds a degree in
business from Georgetown University in Washington, D.C.

         Kevin  Fortuna,  28, has served on the Company's  Advisory  Board since
January  of 1999.  He is  currently  Director  of  Business  Development  at NBC
internet,  where he manages NBCi's east coast business  development group and is
responsible for several of NBCi's largest strategic alliances.  He has also held
senior  business  development and electronic  commerce  positions at Juno Online
Services,  and has worked in the internet  industry for the past five years.  He
graduated  summa cum laude from  Georgetown  University with a degree in English
and History.

<PAGE>

         (c)      Involvement in Certain Legal Proceedings

         On January 5, 2000,  the Company and Directors Kang and Combs were made
defendants to a lawsuit by a former business partner. The plaintiff,  the former
business  partner,  alleged breach of a statutory duty owed by Kang and Combs to
the  plaintiff (a fellow  director and  shareholder).  He claims that he was not
made part of certain  corporate  opportunities  and was not  included in certain
corporate changes and the benefits therefrom. The Company believes the claims of
the plaintiffs regarding the Company are without merit. In addition, the Company
believes that any decision  granted in favor of the plaintiff  would only affect
the shares held by Kang and Combs and would not affect the Company directly.

         Aside from the above mentioned action,  the Company is not aware of any
other  material  legal  proceedings  involving any director,  director  nominee,
promoter,  or control person including  criminal  convictions,  pending criminal
matters, pending or concluded administrative or civil proceedings limiting one's
participation in the securities or banking industries,  or finding of securities
or commodities law violations.

         (d)      Section 16(a): Beneficial Ownership Reporting Compliance

         Section 16(a) of the  Securities  Exchange Act of 1934, as amended (the
"Exchange  Act"),  requires  the  Company's  directors,  executive  officers and
persons  owning  ten  percent  of  the  Company's  common  stock  (collectively,
"Reporting  Persons")  to file  reports of  ownership  with the  Securities  and
Exchange  Commission.  Reporting  Persons  are  required by SEC  regulations  to
furnish the Company with copies of all Section  16(a) forms filed.  Based solely
on a review of the copies of such  reports  furnished to the Company and written
representations  that no other reports were required,  the Company believes that
all  Reporting  Persons  during fiscal year 1999 complied on a timely basis with
all applicable filing requirements under Section 16(a) of the Exchange Act, with
the  exception of Mr. Kang, a member of the Board of Directors and the Company's
Chief Executive  Officer,  and Mr. Combs, a member of the Board of Directors and
the Company's Executive Vice President,  each of whom, the Company believes, was
delinquent  in the filing of a report  covering  the  issuance  of shares of our
common and  preferred  stock and options to purchase  shares of common  stock in
connection with the acquisition of Digital  Commerce,  Inc. The Company believes
that each  Reporting  Person is now making  efforts to effect  such  filings and
satisfy all reporting obligations.

<PAGE>

Item 11.  Executive Compensation

         Summary Compensation Table

         The  Company  did not  conduct  active  business  operations  from 1992
through June 15, 1999. The following table summarizes the total  compensation of
the Chief  Executive  Officer and the  Company's  other most highly  compensated
executive  officers  (collectively,  the Named Executive  Officers")  earning in
excess of $100,000 for the year ended October 31, 1999.
<TABLE>
<CAPTION>

 Name and Principal    Year           Salary $        Other Annual       Securities Underlying
      Position                                        Compensation           Options/SARS
<S>                    <C>          <C>                  <C>                    <C>
Michael Y H Kang       1999         $120,000             $10,932                575,000
CEO

John W Combs           1999         $120,000             $10,882                575,000
Executive VP
</TABLE>

         The additional  compensation received reflects an automobile allowance.
The salary and other annual  compensation  amounts in the table above  represent
annualized amounts for the period between June 15, 1999 to October 31, 1999.

         Stock Option Grants

         The  following  table  provides  information  relating to stock options
awarded to each of the Named  Executive  Officers  during the fiscal  year ended
October 31, 1999.
<TABLE>
<CAPTION>

                                                        Individual Grants

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

                                                                                           Potential Realizable
                                                                                          Value at Assumed Annual
                             Number of     Percent of Total                            Rate of Stock Appreciation
                            Securities         Options                                              for
                            Underlying         Granted        Exercise                         Option Term(3)
           Name               Options      to Employees in   Price Per       Expiration
                            Granted (#)     Fiscal Year(1)    Share(2)          Date              5%($)   10%($)
-------------------------- ---------------- ---------------- ------------- ------------- ------------- -------------
<S>                        <C>              <C>              <C>           <C>           <C>           <C>

Michael Y H Kang           575,000          37.58%              $.50       June 18, 2009,  $223,003      $302,257
-------------------------- ---------------- ---------------- ------------- ------------- ------------- -------------
John W Combs               575,000          37.58%              $.50       June 18, 2009   $223,003      $302,257
-------------------------- ---------------- ---------------- ------------- ------------- ------------- -------------
</TABLE>

(1)  Based on options  for an  aggregate  of  1,530,000  shares of common  stock
     granted during the fiscal year ended October 31, 1999.

(2)  On the date of the grant of the options for the shares of common stock, our
     Board of Directors estimated that the fair market value of that stock to be
     $0.25.

(3)  Potential  realizable  value is based on the assumption  that the shares of
     our common stock appreciates at the annual rate shown (compounded annually)
     from the date of grant  until the  expiration  of the  option  term.  These
     numbers  are  calculated  based  on  the  requirements  promulgated  by the
     Securities  and  Exchange  Commission  and do not reflect  our  estimate of
     future stock price growth.

<PAGE>

         Fiscal Year-End Option Value

         The following table provides information regarding the number and value
of  options  to  acquire  shares of  common  stock  held by the Named  Executive
Officers on October 31, 1999.
<TABLE>
<CAPTION>

                                             Number of Securities                     Value of Unexercised
                                            Underlying Unexercised                        In-the-Money
                                                  Options at                               Options at
                                              Fiscal Year-End (#)                       Fiscal Year-End1
                                   -----------------------------------------------------------------------------------
               Name                     Exercisable        Unexercisable         Exercisable        Unexercisable
           <S>                          <C>                <C>                   <C>                <C>
           Michael Kang                     0                 575,000                 0               $5,534,375
            John Combs                      0                 575,000                 0               $5,534,375
</TABLE>

(1)  For  purposes of  determining  the values of the options  held by the Named
     Executive  Officers,  the Company  assumed  that the shares of common stock
     underlying  the option  granted had a value of $10.125 per share on October
     31, 1999,  which is the estimated  fair market value the Board of Directors
     attributed to that stock on October 31, 1999.  The option value is based on
     the difference  between the fair market value of such shares on October 31,
     1999, and the option exercise price per share,  multiplied by the number of
     shares subject to the options.

         Employment Agreements

         The Company has adopted a policy of entering into employment agreements
with each of its senior  management  and key  personnel,  and has either entered
into an  employment  agreement  with each of those  persons or has  approved the
terms of such agreements. The employment agreements generally have initial terms
of five years.  Under the agreements,  the employee is entitled to a base salary
($250,000 for Mr. Kang,  $250,000 for Mr.  Combs),  plus  incentive  bonuses (as
determined by the Board of Directors), standard benefits such as health and life
insurance,  and reimbursement of reasonable expenses. The base salary payable to
Mr. Kang and Mr. Combs increases by $50,000 every year to a maximum of $450,000.
The  agreements  also  provide  for moving  allowances  in some  instances.  The
employment  agreements  for a number of the  Company's  senior  management  also
provide for the grant of options.

         The Company may terminate the employment  contracts for cause (which is
defined in the  agreements)  or without  cause.  In  addition,  the employee can
terminate the contract on notice to the Company  ranging from 90 to 180 days. If
the  contract  is  terminated  without  cause or as a  result  of a  "change  of
control,"  as defined in the  agreements,  the  employee  is entitled to receive
severance pay of up to 36 months salary,  depending on the particular agreement.
The agreements also contain non-competition,  non-solicitation and assignment of
inventions  provisions  which the Company  believes are consistent with industry
practice.

         Limitations of Liability and Indemnification

         The  Company's   Certificate  of  Incorporation   limits  the  personal
liability of directors and officers for monetary  damages to the maximum  extent
permitted by Delaware law. Under Delaware law, such limitations include monetary
damages  for any action  taken or failed to be taken as an  officer or  director
except for (i) an act or omission  that  involves  intentional  misconduct  or a
knowing  violation  of the  law,  or (ii)  payment  of  improper  distributions.
Delaware  law also  permits a  corporation  to  indemnify  any current or former
director,  officer, employee or agent if the person acted in good faith and in a
manner  in which he  reasonably  believed  to be in or not  opposed  to the best
interest  of  the  corporation.  In  the  case  of a  criminal  proceeding,  the
indemnified  person must also have had no  reasonable  cause to believe that his
conduct was unlawful.

         The Company's  Bylaws provide that, to the full extent permitted by its
Certificate  of  Incorporation  and the Delaware  General  Corporation  Law, the
Company will  indemnify  (and advance  expenses to) its officers,  directors and
employees in connection with any action,  suit or proceeding (civil or criminal)
to which  those  persons  are made  party by reason of their  being a  director,
officer or employee.  Any such indemnification is in addition to the advancement
of expenses.

         Compensation of Directors

         Directors do not receive cash  compensation for serving on the Board of
Directors or any committee of the Board,  or for any other services  rendered to
the Company in their  capacity as directors of the Company,  but are  reimbursed
for  expenses  they  incur in  connection  with  attending  Board  or  committee
meetings.  There  are no other  arrangements  for  compensation  to the Board of
Directors' members.

Item 12. Security Ownership of Certain Beneficial Owners and Management

         (a)      Security Ownership of Certain Beneficial Owners

         The table below sets forth  information,  as of October 31, 1999,  with
respect to  beneficial  ownership of the  Company's  common stock by each person
known  by  the  Company  to be the  beneficial  owner  of  more  than  5% of its
outstanding  common stock,  by each of its  directors,  by each Named  Executive
Officer,  and by all of the Company's officers and directors as a group.  Unless
otherwise noted,  each shareholder has sole investment and voting power over the
shares owned.

<TABLE>
<CAPTION>

Title of Class         Name of Beneficial Owner        Amount and Nature of     Percent of Class
                                                         Beneficial Owner
<S>               <C>                                        <C>                     <C>
Common            John W Combs(1)                            1,845,000               14.22%
                  815 Hornby Street, Suite 404
                  Vancouver, British Columbia V62
                  286

Common            Michael Y H Kang(2)                        1,845,000               14.22%
                  815 Hornby Street, Suite 404
                  Vancouver, British Columbia V62
                  286
</TABLE>

(1) Includes  1,845,000  shares held by West Point Asset  Management Ltd for the
benefit of Mr.  Combs and his  family.

(2) Includes  1,845,000  shares held byRaging Bull Asset  Management Ltd for the
benefit of Mr. Kang and his family.


<PAGE>
<TABLE>
<CAPTION>

(b)      Security Ownership of Named Executive Officers

  Title of Class          Name and Address of      Amount and nature of    Percent of Class
                           Beneficial Owner          Beneficial Owner
<S>                       <C>                           <C>                     <C>
Class A Preferred         Michael Y H Kang              250,000                 50%

Class A Preferred         John W Combs                  250,000                 50%

</TABLE>



Item 13. Certain Relationships and Related Transactions

Digital  Commerce Bank Inc. is the holder of the Company's bank charter.  John W
Combs,  as nominee of the  Company's  bank,  applied  for the bank  charter  and
contributed the charter to our bank once the application was approved. Following
the  contribution,   the  capital  securities  of  Digital  Commerce  Bank  were
transferred to the Company.

                                     Part IV

Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K

         (a)      Financial Statements

         The Company's  consolidated financial statements and its subsidiary are
included elsewhere in this Report.

         (b)      Financial Statement Schedules

No  schedules  are  required  in  connection  with the filing of this  Report as
amounts  are either  immaterial  or are  otherwise  disclosed  in the  financial
statements.
<TABLE>
<CAPTION>

         (c) Exhibits

INDEX TO EXHIBITS

Exhibit
No.                                      Exhibit                                                                       Page
<S>            <C>                                                                                                      <C>

3.1            Certificate of Incorporation of EZ Data Systems, Inc.
3.2            Bylaws
3.3            Certificate of Amendment of Certificate of Incorporation of EZ Data Systems, Inc.
3.4            Certificate of Amendment of Certificate of Incorporation of Systems Assurance Corporation.
3.5            Certificate of Amendment of Certificate of Incorporation of Systems Assurance Corporation.
3.6            Certificate of Amendment of Certificate of Incorporation of Systems Assurance Corporation.
3.7            Certificate of Change of Location of Registered Office and/or Registered Agent of Systems
                     Assurance Corporation

3.8            Certificate of Change of Location of Registered Office and/or Registered Agent of Systems
                     Assurance Corporation

4.1            Certificate Establishing and Designating the Rights, Preferences and Restrictions of Series
                     A Preferred Stock of Digital Commerce, Inc.
10.1           Certificate of Ownership and Merger Merging EZ Data, Inc. into EZ Data Systems, Inc.
10.2           Certificate of Ownership and Merger Merging Systems Assurance Corporation into Unidata
                     Systems, Inc..
10.3           Acquisition Agreement by and between Assurance Corporation and Digital Commerce, Inc.
10.4           1999 Stock Option Plan
10.5           Employment Agreement with Michael Kang
10.6           Employment Agreement with John W. Combs
10.7           Humboldt Bank Independent Sales Organization (ISO) Agreement
21.1           Subsidiaries of the Registrant
27.1           Financial Data Schedule
</TABLE>

         (d)      Reports on Form 8-K

     No reports on Form 8-K were filed  during the  quarter  ended  October  31,
1999.

<PAGE>

                                   SIGNATURES

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

                              Digital Commerce International, Inc.



August ___, 2000              By:  /s/ Michael Y H Kang
                                 -------------------------------------
                                 Michael Y H Kang
                                 Chairman and Chief Executive Officer

                              Digital Commerce International, Inc.



August ___, 2000              By:  /s/ John W. Combs
                                 --------------------------------------
                                 John W. Combs
                                 Director and Executive Vice President,
                                 Principal Financial Officer


                                    DIRECTORS



August ___, 2000              By:  /s/ Michael Y H Kang
                                 ---------------------------------------
                                 Michael Y H Kang



August ___, 2000              By:  /s/ John W. Combs
                                 ---------------------------------------
                                 John W. Combs