U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-KSB
(Mark One)
|X|  ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
     1934

For the fiscal year ended: November 30, 2002
                           -----------------

|_|  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
     OF 1934

For the transition period from ________________ to ______________.

Commission file Number: 0-18686

                        PAK MAIL CENTERS OF AMERICA, INC.
                        ---------------------------------
                 (Name of small business issuer in its charter)

            Colorado                                     84-0934575
            --------                                     ----------
  (State or other jurisdiction              (I.R.S. Employer Identification No.)
of incorporation or organization)

7173 South Havana, Suite 600, Englewood, CO                80112
-------------------------------------------                -----
(Address of principal executive offices)                 (Zip Code)

Issuer's telephone number: 303-957-1000

Securities registered under Section 12(b) of the Exchange Act: NONE

Securities registered under Section 12(g) of the Exchange Act: Common Stock, par
value $.001 per share

Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months, and (2) has been
subject to such filing requirements for the past 90 days.
YES [X]   NO [ ]

Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure will be contained, to
the best of Issuer's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-KSB or any amendment to
this Form 10-KSB. [ ]

The Issuer's revenues for its most recent fiscal year were $4,610,708.

The aggregate market value of the Issuer's voting stock held as of a recent date
by non-affiliates of the Issuer cannot be ascertained due to the absence of
reliable information as to quoted prices with respect to the Issuer's common
stock.

As of February 10th, 2003, the Issuer had 3,877,737 shares of its $0.001 par
value common stock issued and outstanding.

Transitional small business disclosure format: YES [ ]   NO [X]

<PAGE>

                        PAK MAIL CENTERS OF AMERICA, INC.
                         2002 FORM 10-KSB ANNUAL REPORT
                                TABLE OF CONTENTS


PART I                                                                  Page No.
------                                                                  --------

Item 1.    Description of Business.............................................3

Item 2.    Description of Property.............................................8

Item 3.    Legal Proceedings...................................................8

Item 4.    Submission of Matters to Vote of Security Holders...................8

PART II
-------

Item 5.    Market for Common Equity and Related Stockholder Matters............9

Item 6.    Management's Discussion and Analysis of Financial
           Condition and Results of Operations ...............................10

Item 7.    Financial Statements...............................................13

Item 8.    Changes in and Disagreements with Accountants on
           Accounting and Financial Disclosure................................14

Part III
--------

Item 9.    Directors, Executive Officers, Promoters and Control
           Persons; Compliance with Section 16(a) of the Exchange Act.........15

Item 10.   Executive Compensation.............................................17

Item 11.   Security Ownership of Certain Beneficial Owners and Management.....19

Item 12.   Certain Relationships and Related Transactions.....................21

Item 13.   Exhibits and Reports on Form 8-K ..................................22

Item 14.   Controls and Procedures............................................23

           Signatures.........................................................24


                                       2
<PAGE>

                                     PART I

ITEM 1. DESCRIPTION OF BUSINESS

     (a) Business Development. Pak Mail Centers of America, Inc. (the "Issuer"
or "Company") was incorporated in the State of Colorado on January 27, 1984. The
Company is principally engaged in franchising of retail service centers which
specialize in the packaging and shipping business ("Pak Mail Centers" or
"Centers"). Pak Mail Centers typically provide mailbox service, parcel shipping
and receiving, packaging, freight forwarding and other communications and
information products and services to commercial and residential customers
through a variety of carriers and may offer a variety of related items such as
stamps, greeting cards, stationery supplies, keys and passport photographs.

In November of 2002, Pak Mail filed a preliminary proxy statement with the
Securities and Exchange Commission ("SEC") The proxy statement describes a
proposal involving the merger of Pak Mail Acquisition Corp., a newly formed
corporation wholly-owned by two significant shareholders of Pak Mail common
shares, D.P. Kelly & Associates, L.P. and Pak Mail Investment Partnership L.P.,
with and into Pak Mail.

Under the terms of the merger agreement, shareholders of Pak Mail Acquisition
Corp. would acquire Pak Mail by merging Pak Mail Acquisition Corp. into Pak
Mail. As a result of the merger, the owners of common shares of Pak Mail would
receive $0.0516 per share of common stock, in cash without interest for a total
transaction value of approximately $50,602. The shareholders of Pak Mail
Acquisition Corp. would then become the owners of all of the outstanding common
shares in the surviving corporation. The Company has received comments from the
SEC and has responded to those comments and is awaiting approval from the SEC.
Upon SEC approval, the proxy statement will be finalized and mailed to the
shareholders.

     (b) Business of Issuer.

          (1)(2) Principal Products or Services; Distribution Methods. The
Company's principal business is the marketing of Pak Mail Center franchises and
its principal source of revenues is derived from royalties and franchise fees as
well as from the sale of certain equipment, supplies, forms and materials to
franchisees. As of November 30, 2002, there were 346 domestic and 47
international individual franchises and 22 domestic and 8 international area
agreements in existence.

Franchise Program
-----------------

     The Company offers individual franchise agreements and area marketing
agreements. Individual franchisees are granted the nonexclusive right, within a
specified area, to use the Pak Mail trademarks as well as Pak Mail's proprietary
operating procedures, techniques, forms, equipment and advertising materials in
the operation of a Pak Mail Center. Area marketers and, under a previously
offered area franchise program, area developers, are granted rights to sell

                                       3
<PAGE>

individual franchises for the Company in designated areas and are required to
provide site selection and start up assistance and continuing support for
individual franchisees within those areas. The Company locates prospective
franchisees through advertising, referrals from existing franchisees and the
marketing efforts of its area marketers and developers.

Franchise Agreements, Fees and Related Matters
----------------------------------------------

     Individual Franchises

     Each individual franchisee enters into a franchise agreement (the
"Franchise Agreement") with the Company. The Franchise Agreement requires
payment of an initial franchise fee of $27,950, although franchisees who acquire
more than one franchise are eligible for certain discounts and may be eligible
for financing of the discounted initial franchise fees for second and subsequent
Centers. Individual franchisees are also charged an initial fee ranging between
$580 and $900 for a grand opening advertising and marketing program which is
provided by the Company at or around the time the individual franchisee
commences operation of a Pak Mail Center. Under the Company's current standard
Franchise Agreement, individual franchisees pay a sliding scale monthly royalty
in each calendar year of five percent of the first $200,000 of the franchisee's
royalty based revenues, plus four and one-half percent for the next $50,000 of
royalty based revenues, plus four percent for the next $50,000 of royalty based
revenues, plus three and one-half percent for the next $50,000 of royalty based
revenues, plus three percent for all subsequent royalty based revenues received
in that calendar year. No royalty fee is paid with respect to revenues from
postage stamps. Individual franchisees are also required to pay an advertising
fee each month in the amount of two percent of royalty based revenues, with the
exception of franchisees operating under agreements entered into prior to March
1990 who are required to pay an advertising fee of one percent of gross
revenues. The advertising fees are held in a segregated account controlled by
the Company. These fees are used in connection with the formulation and
execution of national advertising and for other marketing purposes. The
Company's current standard Franchise Agreement has a term of ten years. With the
approval of the Company, the franchisee has the right to transfer and assign
their franchise rights.

     Area Marketing Agreement

     Each area marketer franchisee enters into an area marketing agreement which
requires the payment of an initial fee based upon several factors including
population and other demographic factors in the designated geographic region.
The area marketing agreement grants the right to market franchises within a
specified territory using certain of the Company's trademarks. When an area
marketer successfully markets an individual franchise in its territory, the
Company typically pays the area marketer 40% to 60% of the franchise fee paid by
the individual franchisee. The area marketer receives 50% to 60% of the
royalties paid to the Company by individual franchisees in its territory. If an
individual franchise is sold in an area where there is no area marketer, the
Company retains 100% of all fees and royalties paid by the franchisee. There may
be variations in the terms of specific area marketing agreements based on
special circumstances affecting the geographic area and the area marketer.

                                       4
<PAGE>

     Area Developer Franchises

     The Company no longer offers area developer agreements. Under area
developer agreements previously entered into, initial franchise fees paid to the
Company by individual franchisees within an area are generally divided 60% and
40% between the Company and the area franchisee, respectively. Generally, the
individual franchise royalty fees are divided equally between the Company and
the area franchisee. All franchise fees and royalties are paid directly to the
Company, which then remits the portion of fees owed to the area franchisee. For
individual franchisees in locations which are not encompassed by an area
franchise, the Company retains all fees and royalties.

     International Area Franchises

     The Company's international area franchise agreements require the payment
of an initial franchise fee based upon several factors including population and
other demographic factors in the designated country or geographic region. The
Company often finances a portion of the area franchise fee. The international
area franchisee is responsible for individual franchise marketing, site
selection assistance and lease negotiation, on-site training and continuing
local support of the individual franchisees within their areas.

     Generally, the division of initial franchise fees of individual franchises
within an international area and the individual franchise royalty fees within an
international area is negotiated on a case by case basis. As of November 30,
2002, there were eight international franchise agreements in existence with
respect to geographic areas:

     (1)  Mexico City, Mexico
     (2)  Guadalajara, Mexico
     (3)  Baja California and Sonora, Mexico
     (4)  Chile and Argentina
     (5)  Venezuela
     (6)  Honduras, Panama, Nicaragua, El Salvador, Costa Rica, Belize,
          Guatemala
     (7)  Australia and New Zealand
     (8)  Japan.

Because of the large number of factors that exist with respect to different
countries and different geographic locations within a given country, which may
affect the terms of an international area franchise agreement, the specific
terms of international area franchises may vary significantly from one another.

     Related Matters

     The Company provides various training and support to its franchisees. The
Company furnishes to each franchisee an operations manual, which sets forth many
of the Company's standards and specifications and contains certain provisions
designed to ensure uniformity in the quality of the Pak Mail Center, and
provides updates thereto. In addition, each franchisee is required to attend a
nine day training class with regard to packaging, pricing and available shipping
and mailing services; preparation and execution of marketing and placement of
advertising; record keeping and systems operation; the Company's required
software; soliciting and servicing customers; selecting and training personnel;

                                       5
<PAGE>

and store location and operation. There is no charge for the class, but
franchisees pay their own expenses, including travel, lodging and meals. The
Company also provides three days of on-the-job training in an individual
franchisee's Pak Mail Center.

     The Company offers to franchisees various equipment, supplies, forms and
materials necessary or useful in connection with the operation of the Pak Mail
Center. However, the franchisees are not required to purchase such items from
the Company. Prior to and upon the opening of a new franchisee's Pak Mail
Center, the Company or area franchisee provides additional on-site assistance to
the franchisee. The Company maintains ongoing communications with its
franchisees designed to inform the franchisees of new services to be provided by
the Company, marketing techniques and other operational aspects of the Pak Mail
system.

     For the fiscal years 1996 through 2001 the Company developed a point of
sale software program ("PSS") for inclusion in the Pak Mail operating system.
After several years of development and due to the inability to produce a
functioning product, Pak Mail made arrangements with Resource Inc. in May of
2001 to purchase licenses for all of the stores for Resource's off the shelf
packing and shipping point of sale software. The remaining capitalized software
costs of the PSS development ($571,955) were impaired in the third quarter of
2002.

Services
--------

     The typical Pak Mail Center offers a wide range of services and products
for personal and business support, communications services and convenience items
and services. The type and importance of particular services and products vary
from Center to Center. Prices for services and products are set by individual
franchisees and depend on competitive conditions in their respective franchise
locations.

     Major services and products offered at typical retail Pak Mail Centers
include the following:

     Shipping and Receiving. Pak Mail Centers offer shipping services through a
variety of carriers and can assist the customer in selecting the fastest and
most cost effective method of sending goods. Pak Mail Centers also act as
receiving agents for goods shipped to their customers. Pak Mail Centers advise
customers as to the packaging requirements of the various carriers, provide
packaging of items for shipment and sell packaging materials.

     Business Support Products and Services. Small businesses are often major
users of a Pak Mail Center. Pak Mail Centers provide a small business with a
variety of business services and products such as mailbox rental, telecopy
transmission, copying and office supplies.

     Communications Services. Pak Mail Centers may offer customers a wide range
of communications services such as telecopies, wire transfer of funds and
electronic mail and Internet access.

                                       6
<PAGE>

     Convenience Items and Services. Pak Mail Centers generally offer
convenience items such as postage stamps, envelopes, custom rubber stamps,
laminating, passport and identification photos and keys. Most Pak Mail Centers
also offer office supplies, greeting cards, gift wrapping and other gift items.

     Insurance. Also available at the customer's option is loss damage insurance
which can be purchased either through the courier's insurance carrier and/or
separate parcel insurance which is available on an as needed basis from the
Company's carrier. The insurance prices for the Company's insurance vary from
those charged by carriers.

     Private Mailbox Service. Pak Mail Centers usually offer private mailbox
rentals. Mailbox rental fees vary based on the size of the box, the rental terms
and the location of the Pak Mail Center.

          (3) Status of New Products or Services. None.

          (4) Competition. The Company and its franchisees face competition
primarily from independent packaging and shipping service centers and other
franchised operations offering similar products and services. Mail Boxes Etc. is
the largest competitor. The Company's franchising approach and the operations of
a Pak Mail Center are not unique or patentable and can be imitated by others.
Although the Company and its franchisees offer services similar to those offered
by the U.S. Postal Service, such as private mail box service and parcel
handling, the U.S. Postal Service does not offer certain of the business
support, communications and personal services offered by most Pak Mail Centers.

          (5) Raw Materials and Supplies. The Company purchases materials for
resale to its franchisees. These materials are available from a variety of
suppliers, and the Company has not experienced any delays in obtaining such
materials.

          (6) Customer Dependence. The Company does not depend upon a single
customer, or a few customers, for its revenues, the loss of any one or more
which would have a material adverse effect on the Company.

          (7) Patents, Trademarks, Licenses, Etc. The Company has registered the
service mark "Pak Mail" and the Pak Mail logo on the Principal Register of the
United States Patent and Trademark Office ("USPTO"). The service mark was
renewed for an additional 10 years in November 2000 and the logo expires in
2005. The Company has registered several other related service marks on the
Principal Register of the USPTO, and has registered the service mark "Pak Mail"
and the Pak Mail logo in several international countries. The Company purchased
software licenses from Resource Inc. for their point of sale program for each
store in operation as of July 2nd, 2001. The licenses are held by the individual
stores. New stores are required to purchase a license from Resource Inc.,
through Pak Mail.

          (8)(9) Government Regulations. The Federal Trade Commission has a rule
that requires franchisors to make certain disclosures to prospective franchisees
prior to the offer or sale of franchises. This rule requires the disclosure of
information necessary for a franchisee to make an informed decision as to
whether to enter into a franchise relationship and delineates the circumstances
in which franchisors may make predictions on future sales, income and profits.
Failure to comply with this rule constitutes an unfair or deceptive act or
practice under the Federal Trade Commission Act.

                                       7
<PAGE>

     Numerous states have adopted laws regulating franchise operations and the
franchisor/franchisee relationship. Applicable franchise laws vary from filing
and disclosure requirements in the offer and sale of franchises to the
application of statutory standards regulating the establishment and termination
of franchise relationships. Although the foregoing matters may result in some
modification of the Company's franchising activities and the legal inability to
enforce all of the terms of its franchise agreements in certain states, such
inabilities have not had a material adverse effect on the operations or business
of the Company to date. However, the laws applicable to franchise operations and
relationships are subject to change, and the Company is unable to predict the
effect, if any, on its operations of additional laws, regulations or
restrictions that may be enacted or promulgated or of court decisions that may
be adverse to the franchise industry.

          (10) Research and Development. In developing PSS, the Company spent
$197,229 in fiscal 2001 and $-0- in fiscal 2002. Other than developing the PSS
System, the Company has not engaged in material research and development
activities during its last two fiscal years.

          (11) Environmental Regulation. Compliance with federal, state and
local environmental law provisions does not have any material effect on the
capital expenditures, earnings and competitive position of the Company.

          (12) Employees. As of November 30, 2002, the Company had 12 employees,
all full-time.


ITEM 2. DESCRIPTION OF PROPERTY

     The Company's executive offices are located in approximately 12,540 square
feet of office space in Englewood, Colorado under a lease expiring in May 2006
with a base rental currently at approximately $14,995 per month and rising to
approximately $15,840 per month by the end of the term. The Company is the first
tenant in this office space and the offices are in excellent condition.

ITEM 3. LEGAL PROCEEDINGS

     Other than routine litigation that is incidental to the business the
Company was not involved in any legal proceedings during the fiscal year.

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

     No matter was submitted during the fourth quarter of the fiscal year
covered by this report to a vote of the Company's security holders.

                                       8
<PAGE>

                                    PART II

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

     (a) Market Information.

     The Company's common stock is sporadically traded in the over-the-counter
market. During fiscal 2002 and 2001 there was no established trading market for
the Company's common stock, and the Company has been unable to obtain reliable
information as to quoted prices with respect to the common stock.

     (b) Holders.

     As of February 10th, 2003, the Company had 1,113 holders of record of its
$0.001 par value common stock.

     (c) Dividends.

     The Company has not declared cash dividends on its common stock in the last
two fiscal years and in any subsequent period for which financial information is
required. The Company has issued and outstanding 2,216.668 shares of its Series
C Preferred Stock, which have a 6% annual dividend payable on March 31 of each
year. All dividends through fiscal 2000 were declared and paid. Dividends for
fiscal 2001 and 2002 have not been declared or paid. The Company must pay all
dividends in arrears on the Series C Preferred Stock before any dividends may be
paid or declared and set aside for payment and before any other distribution may
be made on the Company's common stock. Due to the Company's negative equity as
of November 30, 2002, no dividends can be accrued on the financial statements
and no dividends can be declared or paid until the Company demonstrates positive
equity. The preference for the preferred stock dividends will be disclosed in
the footnotes to the financial statements. The Company does not anticipate
paying any cash dividends on its common stock in the foreseeable future.


                                       9
<PAGE>
<TABLE>
<CAPTION>

     (d) Securities authorized for Issuance Under Equity Compensation Plans.

<S>                         <C>                             <C>                         <C>
--------------------------- ------------------------------- --------------------------- --------------------------------
Plan Category               Number of securities to be      Weighted-average exercise   Number of securities remaining
                            issued upon exercise of         price of outstanding        available for future issuance
                            outstanding options, warrants   options, warrants, and      under equity compensation plans
                            and rights                      rights                      (excluding securities reflected
                                                                                        in column (a))
                            (a)                             (b)                         (c)
--------------------------- ------------------------------- --------------------------- --------------------------------
Equity compensation plans
approved by security
holders

1999 Incentive and
Non-statutory Stock                    108,160                        $0.75                         227,773
Option Plan (1)
--------------------------- ------------------------------- --------------------------- --------------------------------
Equity compensation plans
not approved by security                 none                          none                          none
holders
--------------------------- ------------------------------- --------------------------- --------------------------------

(1) The 1999 Incentive and Non-statutory Stock Option Plan (the Plan) authorizes
the issuance of up to 400,000 shares of the Company's Common Stock. The Plan
will remain in effect until December 31, 2008 unless terminated earlier by
action of the Board. All employees of the Company are eligible to receive
options under the Plan at the discretion of the Board. Options issued under the
Plan vest one- third per year upon each of the first three anniversaries of the
issue date and have a term of ten years from the date of issue.

</TABLE>

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

Changes in Accounting Principle Imposed by the SEC
--------------------------------------------------

     The Company changed its accounting policy to reflect a decision made by the
Securities and Exchange Commission ("SEC") in December 1999 relative to the
recognition of area developer/marketer franchise fee revenue. Revenue from area
developer/marketer agreements which is not tied to unit sales performance is
initially deferred and recognized on a straight line basis over the life of the
agreement. The Company's policy in previous fiscal years was to recognize sales
to area developers/marketers on a cash received basis. As cash was received on a
sales contract, the Company recognized the associated income. The area marketing
agreements were typically executed for a 5 year period. Under the method started
in 1999, all payments received must be capitalized and amortized over the life
of the agreement. The new method was applied retroactively in 1999 on all
contracts in existence.

     This change is strictly an accounting reporting issue and has no effect on
cash flow or the Company's business operations.


                                       10
<PAGE>

Liquidity and Capital Resources
-------------------------------

     The Company provided cash from operating activities of $39,505 during
fiscal 2002 compared to cash provided by operating activities of $318,543 during
fiscal 2001. The cash was used to pay down accounts payable during fiscal 2002.

     As of November 30, 2002, the average age of accounts receivable was
approximately 58 days compared to 57 days in 2001. Accounts receivable relate
primarily to royalties from franchisees and sales of equipment, supplies and
services. Royalties are payable on a monthly basis and invoices for equipment,
supplies and services are payable within 30 days.

     For fiscal 2003 the company expects to increase cash flow through increases
in unit sales, minimizing capital expenditures, and reviewing and reducing all
operating expenditures. Several operating expenses have been substantially
reduced including salaries, telephone, legal, and advertising.

The Company believes that cash flow from operating activities will be adequate
to cover operating capital needs for the next 12 months.

Proposed Merger:

In November of 2002, Pak Mail filed a preliminary proxy statement with the
Securities and Exchange Commission (SEC) The proxy statement describes a
proposal involving the merger of Pak Mail Acquisition Corp., a newly formed
corporation wholly-owned by two significant stockholders of Pak Mail common
shares, D.P. Kelly & Associates, L.P. and Pak Mail Investment Partnership L.P.,
with and into Pak Mail.

Under the terms of the merger agreement, stockholders of Pak Mail Acquisition
Corp. would acquire Pak Mail by merging Pak Mail Acquisition Corp. into Pak
Mail. As a result of the merger, the owners of common shares of Pak Mail would
receive $0.0516 per share of common stock, in cash without interest for a total
transaction value of approximately $50,602. The stockholders of Pak Mail
Acquisition Corp. would then become the owners of all of the outstanding common
shares in the surviving corporation. The Company has received comments from the
SEC and has responded to those comments and is awaiting approval from the SEC.
Upon SEC approval, the proxy statement will be finalized and mailed to the
stockholders. The Company presently anticipates that the cash consideration
payable to unaffiliated shareholders (expected to total approximately $50,602)
will primarily be provided by a $50,000 capital contribution provided by D.P.
Kelly & Associates, L.P., to Pak Mail Acquisition Corp.


Results of Operations
---------------------

     Financial statements for the year ended November 30, 2000 are included
strictly for franchising purposes and no comparisons will be included in
management's discussion and analysis.

                                       11
<PAGE>

     Fiscal 2002 Compared to Fiscal 2001
     -----------------------------------

     The Company's recorded net loss from operations for fiscal 2002 was
$675,666 compared to a net loss in 2001 of $368,678. The $306,988 increase was
attributable to an increase in recognition of franchise fees (up 18.96% from
$875,099 to $1,041,005) an increase in Sales of products and services (up 21.09%
from $643,639 to $779,357), a decrease in PSS license & maintenance fees (down
100% from $121,170 to $-0-), a decrease in Other income (down 14.90% from
$133,398 to $113,524) a decrease in Selling, general and administrative costs
(down 13.53% from $1,989,770 to $1,720,467), an increase in the Cost of sales of
products and services (up 15.28% from $730,848 to $842,527), an increase in
commissions on franchise sales (up 27.12% from $355,343 to $451,701), a decrease
in Advertising expenditures (down 36.03% from $133,164 to $85,180), a decrease
in depreciation and amortization (down 58.09% from $139,573 to $58,494), an
increase in impairment of capitalized software costs (up 100% from $-0- to
$571,956), an increase in Post employment expenses (up 100% from $-0- to
$272,238, an increase in Income tax expense (up 38.20% from $214,766 to
$132,734) and a decrease in Preferred stock dividend (down 100% from$133,000 to
$-0-).

     The $165,906 increase in franchise fees is represented by an increase in
franchise sales sold and recognized during the fiscal 2002. The Company
recognized 24 individual franchises in fiscal 2001 and 33 in 2002.

     The $135,718 increase in sales of products and services in fiscal 2002 is
the result of increased franchise sales resulting in more store buildouts.

     The $121,170 decrease in Software license fees is a result of Pak Mail's
decision to discontinue development and use of its proprietary software. There
was no revenue from this activity in the second half of 2001 and for all of
2002. The company made arrangements to purchase software licenses from Resource
Inc., a software vendor to the packing and shipping industry. Maintenance fees
are paid directly to Resource by the franchisees.

     The $19,874 decrease in other income is due to the decreased number of
store transfers in 2002.

     The $269,303 decrease in Selling, general and administrative is due to a
decrease in Wage expense (down $225,108) a result of staff reductions, an
increase in bad debt expense (up $24,000); and a reduction in legal expense
(down $66,652), a result of an extra area UFOC filing required in 2001.

     The $111,679 increase in cost of sales of equipment, supplies and services
is the result of increased store sales and store buildouts.

     The $96,358 increase in commissions on franchise sales is the direct result
of increased store sales and increased sales recognition in fiscal 2002.

                                       12
<PAGE>

     The $47,984 decrease in advertising is due to the elimination of
non-productive advertising expenditures. All leads are now being tracked by lead
source. Any source that does not produce quality leads is eliminated.

     The $81,079 decrease in depreciation and amortization is a result of Pak
Mail's decision to discontinue development and use of its proprietary software.
The company made arrangements to purchase software licenses from Resource
Software Inc., a software vendor to the packing and shipping industry. The
remainder of the capitalized software development cost was impaired in the third
quarter of 2002. This has eliminated any associated amortization of those costs.

     The $571,956 increase in impairment of capitalized software costs for
fiscal 2002 is due to Pak Mail's inability to produce a functioning point of
sale software package. After spending five years trying to develop a custom
point of sale software package, Pak Mail made arrangements with Resource
Software in May of 2001 to purchase licenses for all of the stores for
Resource's off the shelf packing and shipping point of sale software. During the
3rd and 4th quarters of 2001, the franchisees were converted back to Resource
software. The company contracted with Resource to peruse the code in PSS
versions 1 and 2 and incorporate the marketing and specialty packaging modules
from PSS into the Resource software. After converting the franchise community to
Resource software, Resource analyzed the code from PSS and determined that it
was of no value. Resource wrote new code for the marketing and specialty packing
modules and incorporated it into the Resource point of sale software at no cost
to Pak Mail. Subsequently the remaining capitalized software costs were impaired
in the third quarter of 2002.

     The $132,734 Income Tax Expense is a result of reducing the value of the
Deferred Income Tax asset carried on the balance sheet to $-0-. Due to
continuing losses, Pak Mail's Net Operating Loss carry-forwards are expiring.
The Net Operating Loss carry-forwards allow Pak Mail to reduce their taxable
income.

     The foregoing discussion contains certain forward looking statements within
the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. These statements include the plans and
objectives of management for future operations, including plans and objectives
relating to the development of the Company. The forward-looking statements
included herein are based on current expectations that involve numerous risks
and uncertainties. Assumptions relating to the foregoing involve judgments with
respect to, among other things, future economic, competitive and market
conditions and future business decisions, all of which are difficult or
impossible to predict accurately and many of which are beyond the control of the
Company. Although the Company believes that the assumptions underlying the
forward looking statements are reasonable, any of the assumptions could be
inaccurate and, therefore, there can be no assurance that the forward looking
statements included in this Form 10-KSB will prove to be accurate. In light of
the significant uncertainties inherent in the forward looking statements
included herein, the inclusion of such information should not be regarded as a
representation by the Company or any other person that the objectives and plans
of the Company will be achieved.

ITEM 7. FINANCIAL STATEMENTS

     See Financial Statements in this report following the signature page. Three
years of Financial Statements are presented in this filing. The two most recent
years are compared to each other, fiscal 2002 and fiscal 2001. Fiscal 2000 is
presented for informational and franchising purposes only.

                                       13
<PAGE>

ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
        FINANCIAL DISCLOSURE

     During the Company's two most recent fiscal years, and any interim period,
the principal independent accountant of the Company did not resign (or decline
to stand for re-election) and was not dismissed.
















                                       14
<PAGE>
<TABLE>
<CAPTION>

                                    PART III

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE
        WITH SECTION 16(a) OF THE EXCHANGE ACT

     (a) Identification of Directors and Executive Officers.
     -------------------------------------------------------

     The present term of office of each director will expire at the next annual
meeting of shareholders. The executive officers of the Company are elected
annually at the first meeting of the Company's Board of Directors held after
each annual meeting of shareholders. Each executive officer holds office until
his or her successor is duly elected and qualified or until his or her
resignation or until he or she shall be removed in the manner provided by the
Company's Bylaws. The name, position with the Company, the age of each director
and executive officer, and the period during which each has served are as
follows:

Name, Age and                         Director or         Principal Occupation
Position in the Company               Officer Since       During the Last Five Years
-----------------------               -------------       --------------------------
<S>                                   <C>                 <C>
P. Evan Lasky, 61                     March, 1988         Executive officer of the Company since March
(President, Secretary, Treasurer,                         1988. and Secretary/Treasurer since November
Chief Executive Officer and Chief                         2001
Financial Officer)

Alex Zai, 43                          May, 1996           Executive officer of the Company since May,
(Vice President)                                          1996; director of store operations of the
                                                          Company since April, 1994.

J. S. Corcoran, 58                    September, 1989     Self-employed as a business consultant since
(Director)                                                October, 1996; executive officer of D.P.
                                                          Kelly & Associates L.P., a firm offering
                                                          management services, from November, 1988 to
                                                          January, 1997; executive officer of
                                                          Envirodyne Industries, Inc., a manufacturer
                                                          of food packaging and food service supplies,
                                                          from June, 1989 to March, 1996.

John W. Grant, 77                     September, 1989     Retired since September, 1987.
(Director)


                                       15
<PAGE>

Name, Age and                         Director or         Principal Occupation
Position in the Company               Officer Since       During the Last Five Years
-----------------------               -------------       --------------------------

F. Edward Gustafson, 61               September, 1989     Executive officer of D.P. Kelly & Associates
(Director)                                                L.P., a firm offering management services,
                                                          since November, 1988; executive officer of
                                                          Viskase Companies, Inc., a manufacturer of
                                                          food packaging and food service supplies,
                                                          since June, 1989; director of Viskase
                                                          Companies, Inc. since December, 1993;
                                                          executive officer of Viskase Corporation, a
                                                          wholly-owned subsidiary of Viskase Companies,
                                                          Inc., from February, 1990 to August, 1993.

Laura K. McGrath 46                   September, 1989     General Partner of KMK & Associates, an
(Director)                                                investment partnership since May, 1986;
                                                          President of Emerald Valley Farms, Inc. a
                                                          farm land acquisition and management company
                                                          since March, 1999; Treasurer of the Donald P.
                                                          and Byrd M. Kelly Foundation, a family
                                                          foundation that focuses on educational
                                                          support for non-profit organizations, since
                                                          November, 1988.
</TABLE>

     (b) Identification of Certain Significant Employees.
     ----------------------------------------------------

     Not Applicable.

     (c) Family Relationships.
     -------------------------

     Not Applicable.

     (d) Involvement in Certain Legal Proceedings.
     ---------------------------------------------

     Not Applicable.

     (e) Section 16(a) Beneficial Ownership Reporting Compliance.
     ------------------------------------------------------------

     Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors and persons who own more than 10% of the Company's
outstanding common stock to file reports of ownership with the SEC. Officers,
directors and greater than 10% shareholders are required by SEC regulations to
furnish the Company with copies of all Section 16(a) forms they file.

     For the fiscal year ending November 30, 2002, all Forms 3, 4, and 5 have
been timely filed for all officers and directors and persons who own more than
10% of the Company's outstanding common stock

                                       16
<PAGE>

ITEM 10. EXECUTIVE COMPENSATION

     Cash Compensation.
     ------------------

     The following table shows all cash compensation paid by the Company for
services rendered during the fiscal years ended November 30, 2002, November 30,
2001, and November 30, 2000 to John E. Kelly and P. Evan Lasky (there were no
other executive officers of the Company whose annual salary and bonus exceeded
$100,000).

                           SUMMARY COMPENSATION TABLE

Name and                                                           Other Annual
Principal Position        Fiscal Year    Salary        Bonus       Compensation
------------------        -----------    ------        -----       ------------

John E. Kelly                2002       $161,000(3)      -0-(1)    $8,520(2)(3)
Chairman of the Board        2001       $161,000      $2,300       $8,520(2)
                             2000       $153,300         -0-(1)    $8,520(2)

P. Evan Lasky                2002       $125,000         -0-(1)       -0-
President, Chief Executive   2001       $122,000      $1,500          -0-
Officer, Treasurer,          2000       $112,000         -0-(1)       -0-
Secretary, and Chief
Financial Officer

     (1) Bonus was earned in the fiscal year indicated, although it may have
been paid in the following fiscal year.

     (2) The amount for fiscal 2002, 2001 and 2000 consists of a $4,800 car
allowance and $3,720 of country club dues

     (3) The amounts for fiscal 2002 were paid per the employment contract dated
February 28, 2002 between John E. Kelly and Pak Mail.


     Stock Option Plans.
     -------------------

     Effective January 1, 1999, the Company adopted the 1999 Incentive and
Nonstatutory Stock Option Plan ("1999 Plan"). The 1999 Plan authorizes the
granting of options to employees and non-employee directors of the Company to
purchase an aggregate of 400,000 shares of the Company's common stock. No

                                       17
<PAGE>

options may be granted after December 31, 2008 under the 1999 Plan. There were
no options issued during the years ended November 30, 2000, 2001 or 2002. For
the fiscal year ended November 30, 1999, employees of the Company were issued
options under the 1999 Plan to purchase a total of 172,227 shares of the
Company's common stock at $.75 per share expiring in December 2009.


     Options/SAR Grants.
     -------------------

     The following table sets forth the individual grants of stock options made
during the last two completed fiscal years to each of the named executive
officers:

There were no options granted in fiscal 2000.
There were no options granted in fiscal 2001.
There were no options granted in fiscal 2002.


     Fiscal Year End Option Values
     -----------------------------

                        Number of Securities
                             Underlying
                         Unexercised Options
    Name                 at Fiscal Year End
-------------           --------------------

John E. Kelly                  30,000

P. Evan Lasky                  22,000


     Long-Term Incentive Plans.
     --------------------------

     Not Applicable.


     Compensation of Directors--Standard Arrangement.
     ------------------------------------------------

     Members of the Board of Directors, other than members who are also officers
of the Company, are entitled to receive a fee of $2,000 per year and $250 for
each attended meeting of the Board of Directors.


     Compensation of Directors--Other Arrangements.
     ----------------------------------------------

     Not Applicable.

                                       18
<PAGE>

     Employment Contracts and Termination of Employment and Change of Control
Arrangements.
-----------------------------------------------------------------------------

     In fiscal 2001 the Company adopted a Severance Pay Policy for certain of
its officers and employees. Under this Policy, John E. Kelly and P. Evan Lasky
are entitled to a pro rata share of any bonus earned under the Management
Incentive Plan or any comparable plan in effect at the time of termination of
employment, plus 24 months and 18 months salary, respectively, following
termination of employment if the termination occurs in the 24-month period
following a change in control of the Company. Change in control under the Policy
is defined as the sale of the stock and/or substantially all of the assets of
the Company as approved by the Board of Directors. To be eligible for the
severance pay the termination must be a result of:

     (a)  any involuntary separation of employment from the Company for any
          reason other than death, disability or willful misconduct on the part
          of the employee;

     (b)  any voluntary separation of employment from the Company following a
          reduction in the employee's base compensation and incentive bonus
          opportunity from that in effect on the day immediately before the
          change in control;

     (c)  any voluntary separation of employment from the Company following a
          reduction in the employee's principal responsibilities from those in
          effect on the day immediately before the change in control; or

     (d)  any change in the employee's work location by more than 50 miles than
          the work location on the day immediately before the change in control,
          except for those employees who, on a project basis, would normally
          change location.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND  MANAGEMENT.

     (a)(b) Security Ownership of Certain Beneficial Owners and Management.
     ----------------------------------------------------------------------

     The following table sets forth as of November 30, 2002, the number of
shares of the Company's $0.001 par value common stock, its only class of
outstanding voting securities, beneficially owned by each of the Company's
current directors and executive officers, by all of the Company's current
directors and executive officers as a group, and by each person who owned of
record, or was known to own beneficially, more than 5% of the Company's
outstanding shares of common stock:

                                       19
<PAGE>

--------------------------------------------------------------------------------
Name and Address                             Amount and Nature of       Percent
of Beneficial Holder                        Beneficial Ownership(1)   of Class
--------------------------------------------------------------------------------
J. S. Corcoran                                   2,898,078(2)              74.7%
701 Harger Road, Suite 190
Oak Brook, Illinois  60523
630-571-4433
--------------------------------------------------------------------------------
John W. Grant                                         800                   (3)
701 Harger Road, Suite 190
Oak Brook, Illinois  60523
630-571-4433
--------------------------------------------------------------------------------
F. Edward Gustafson                              2,925,578(2)              75.4%
701 Harger Road, Suite 190
Oak Brook, Illinois  60523
630-571-4433
--------------------------------------------------------------------------------
P. Evan Lasky                                      22,000(4)                (3)
7173 South Havana Street, Suite 600
Englewood, Colorado  80112
303-957-1000
--------------------------------------------------------------------------------
Laura K. McGrath                                       0                    (3)
701 Harger Road, Suite 190
Oak Brook, Illinois 60523
630-571-4433
--------------------------------------------------------------------------------
All directors and executive officers as       2,949,378(2)(4)              75.6%
a group (5 persons)
--------------------------------------------------------------------------------
Donald P. Kelly                                  2,997,078(2)              77.3%
701 Harger Road, Suite 190
Oak Brook, Illinois  60523
630-571-4433
--------------------------------------------------------------------------------
C&G Management Company, Inc.                     2,897,078(2)              74.7%
701 Harger Road, Suite 190
Oak Brook, Illinois 60523
630-571-4433
--------------------------------------------------------------------------------
D.P. Kelly and Associates, L.P.                  2,897,078(2)              74.7%
701 Harger Road, Suite 190
Oak Brook, Illinois  60523
630-571-4433
--------------------------------------------------------------------------------
Norcross Corporation                             2,897,078(2)              74.7%
701 Harger Road, Suite 190
Oak Brook, Illinois 60523
630-571-4433
--------------------------------------------------------------------------------
Norcross Partners L.P.                           2,897,078(2)              74.7%
701 Harger Road, Suite 190
Oak Brook, Illinois 60523
630-571-4433
--------------------------------------------------------------------------------
Pak Mail Investment Partnership L.P.             2,897,078(2)              74.7%
701 Harger Road, Suite 190
Oak Brook, Illinois  60523
630-571-4433
--------------------------------------------------------------------------------
Pak Mail Acquisition Corp.                       2,897,078(2)              74.7%
701 Harger Road, Suite 190
Oak Brook, Illinois  60523
630-571-4433
--------------------------------------------------------------------------------

(1)  Beneficial ownership is calculated in accordance with Section 13(d) of the
     Securities Exchange Act of 1934 as amended, and the rules promulgated
     thereunder. Accordingly, the "Amount and Nature of Beneficial Ownership"
     and the "Percent of Class" for each person listed in the table are based
     upon the assumption that stock options which are exercisable currently or
     within 60 days after the date of this proxy statement held by such person
     have been exercised. Unless otherwise indicated, the persons listed in the
     table have sole voting and investment power of the shares listed for such
     person.
(2)  Includes 2,897,078 shares owned by Pak Mail Acquisition Corp., 2,404,264 of
     which were contributed by PMIP and 492,814 of which were contributed by
     D.P. Kelly. PMIP and D.P. Kelly together own 100% of the equity interest in
     Pak Mail Acquisition Corp. and may therefore, pursuant to Rule 13d-3 under
     the Exchange Act, be deemed to constitute a "group" and to jointly
     beneficially own the 2,897,478 shares of Pak Mail common stock owned by Pak
     Mail Acquisition Corp. Norcross Partners is the general partner of PMIP,
     and Norcross Corp. is the general partner of Norcross Partners. Messrs.

                                       20
<PAGE>

     Kelly and Gustafson are executive officers and directors of, and Messrs.
     Kelly, Gustafson and Corcoran own the entire equity interest in, Norcross
     Corp. Mr. Kelly's ownership interest is held through his revocable trust.
     As a result of the control exercised by Messrs. Kelly, Gustafson and
     Corcoran over Norcross Corp., the control exercised by Norcross Corp. over
     Norcross Partners and the control exercised by Norcross Partners over PMIP,
     each of Messrs. Kelly, Gustafson and Corcoran and each of Norcross Corp.
     and Norcross Partners may be deemed to share the beneficial ownership of
     Pak Mail common stock beneficially owned by PMIP. C&G Management is the
     general partner of D.P. Kelly. Messrs. Kelly and Gustafson are executive
     officers and directors of, and own the entire equity interest in, C&G
     Management. Mr. Kelly's ownership interest is held through his revocable
     trust. As a result of the control exercised by Messrs. Kelly and Gustafson
     over C&G Management and the control exercised by C&G Management over D.P.
     Kelly, each of Messrs. Kelly and Gustafson and C&G Management may be deemed
     to share the beneficial ownership of the Pak Mail common stock beneficially
     owned by D.P. Kelly.
(3)  Less than 1%.
(4)  Includes 22,000 shares of common stock subject to stock options.


     (c) Changes in Control.
     -----------------------

In November of 2002, Pak Mail filed a preliminary proxy statement with the
Securities and Exchange Commission (SEC) The proxy statement describes a
proposal involving the merger of Pak Mail Acquisition Corp., a newly formed
corporation wholly-owned by two significant stockholders of Pak Mail common
shares, D.P. Kelly & Associates, L.P. and Pak Mail Investment Partnership L.P.,
with and into Pak Mail.

Under the terms of the merger agreement, stockholders of Pak Mail Acquisition
Corp. would acquire Pak Mail by merging Pak Mail Acquisition Corp. into Pak
Mail. As a result of the merger, the owners of common shares of Pak Mail would
receive $0.0516 per share of common stock, in cash without interest for a total
transaction value of approximately $50,602. The stockholders of Pak Mail
Acquisition Corp. would then become the owners of all of the outstanding common
shares in the surviving corporation. The Company has received comments from the
SEC and has responded to those comments and is awaiting either approval or
further comments from the SEC. Upon SEC approval, the proxy statement will be
finalized and mailed to the shareholders.


ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     (a)(b) Transactions With Management and Others and Certain Business
Relationships.

     Other than the merger proposal described previously in the business section
there are no other transactions to be disclosed.

     (c) Parent Companies. Pak Mail Acquisition Corp. owns a controlling
interest in the Company through its ownership of 2,897,078 shares of common
stock, representing approximately 74.7% of the outstanding common stock.

     (d) Transactions With Promoters. Not Applicable.


                                       21
<PAGE>

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

     (a) Exhibits.
     -------------

(2)(a)*     Agreement and Plan of Merger dated as of October 17, 2002 by and
            between Pak Mail Centers of America, Inc. and Pak Mail Acquisition
            Corp.

(2)(b)*     First Amendment to Agreement and Plan of Merger dated as of October
            28, 2002 by and between Pak Mail Centers of America, Inc and Pak
            Mail Acquisition Corp.

(3)(a)      Articles of Incorporation incorporated by reference to Exhibit
            (3)(a) of the Company's Annual Report on Form 10-KSB for the fiscal
            year ended November 30, 1995.

(3)(b)      Articles of Amendment to the Articles of Incorporation filed with
            the Colorado Secretary of State on January 26, 1998 incorporated by
            reference to Exhibit (3)(b) of the Company's Annual Report on Form
            10-KSB for the fiscal year ended November 30, 1997.

(3)(c)      Articles of Amendment to the Articles of Incorporation filed with
            the Colorado Secretary of State on July 13, 1998, incorporated by
            reference to Exhibit 3(a) of the Company's Quarterly Report on Form
            10-QSB for the quarter ended May 31, 1998.

(3)(d)      Bylaws incorporated by reference to Exhibit 3(b) of the Company's
            Quarterly Report on Form 10-QSB for the quarter ended May 31, 1998.

(10)(a)*    Individual Franchise Agreement.

(10)(b)*    Area Marketing Agreement.

(10)(c)     Pak Mail Centers of America, Inc. Management Incentive Plan for
            Fiscal Year 1998 incorporated by reference to Exhibit (10)(f) of the
            Company's Annual Report on Form 10-KSB for the fiscal year ended
            November 30, 1998.

(10)(d)     Pak Mail Centers of America, Inc. Management Incentive Plan for
            Fiscal Year 1999 incorporated by reference to Exhibit (10)(g) of the
            Company's Annual Report on Form 10-KSB for the fiscal year ended
            November 30, 1998.

(10)(e)     Pak Mail Centers of America, Inc. 1999 Incentive and Non-statutory
            Employee Stock Option Plan incorporated by reference to Exhibit
            (10)(h) of the Company's Annual Report on Form 10-KSB for the fiscal
            year ended November 30, 1998.

(10)(f)     Contract with Immedient, a software development company to re-write
            the PSS software. (Scope Document) incorporated by reference to
            exhibit 10(f) of the Company's Annual Report on Form 10 KSB for the
            fiscal year ending November 30, 2001.

                                       22
<PAGE>

(10)(g)     Promissory Note, D.P. Kelly & Associates, L.P. incorporated by
            reference to the Company's Annual Report on Form 10-KSB for the
            fiscal year ending November 30, 2001

(10)(h)     Office Lease with Bedford Property Investors for office located at
            7173 South Havana Street, Denver, CO 80112, approximately 12,540
            square feet. (to be filed by amendment) incorporated by reference to
            the Company's Annual Report on Form 10 KSB for the fiscal year
            ending November 30, 2001.

(10)(i)     Resource, Inc. software licensing contract incorporated by reference
            to the Company's Annual Report on Form 10 KSB for the fiscal year
            ending November 30, 2001.

(10)(j)     Employment contract for John E. Kelly, chairman of the board
            incorporated by reference to exhibit 10(j) of the Company's Annual
            Report on Form 10-QSB for the fiscal quarter ending February 28,
            2002

(21)*       Subsidiaries of the Registrant.

(99.1)*     Chief Executive Officer Certification per Sarbanes-Oxley Section 906

(99.2)*     Accounting Supervisor Certification per Sarbanes-Oxley Section 906

----------
     *    Filed herewith.


     (b) 8-K Reports.
     ----------------

     The Company filed a report on form 8-K disclosing the proposed merger with
     Pak Mail Acquisition Corp. The date of the report was October 17th, 2002
     and it was filed on October 21st, 2002 with the SEC.

ITEM 14. CONTROLS & PROCEDURES

An evaluation was performed under the supervision and with the participation of
the Company's management, including the Chief Executive Officer ("CEO") and
Chief Financial Officer ("CFO") of the effectiveness of the design and operation
of the Company's disclosure controls and procedures within 90 days before the
filing date of this quarterly report. Based on that evaluation, the Company's
management, including the CEO and CFO, concluded that the Company's disclosure
controls and procedures were effective. There have been no significant changes
in the Company's internal controls or in other factors that could significantly
affect internal controls subject to their evaluation.

                                       23
<PAGE>

                                   SIGNATURES

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

                                           PAK MAIL CENTERS OF AMERICA, INC.,
                                           a Colorado corporation

                                           By: /s/ P. Evan Lasky
                                           -------------------------------------
                                           P. Evan Lasky, President,
                                           Chief Executive Officer,
                                           Treasurer and Secretary
                                           Chief Financial Officer

     Dated: February 28, 2003

     Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, this report has been signed below by the following persons on behalf of
the registrant and in the capacities and on the dates indicated.

Name and Title             Signature                               Date
--------------             ---------                               ----

J.S. Corcoran              /s/ J.S. Corcoran                 February 28, 2003
Director                   --------------------------



John W. Grant              /s/ John W. Grant                 February 28, 2003
Director                   --------------------------



F. Edward Gustafson        /s/ F. Edward Gustafson           February 28, 2003
Director                   --------------------------



Laura K. McGrath           /s/ Laura K. McGrath              February 28, 2003
Director                   --------------------------




                                       24
<PAGE>


                PAK MAIL CENTERS OF AMERICA, INC. AND SUBSIDIARY

                        Consolidated Financial Statements
                                       and
                          Independent Auditors' Report
                           November 30, 2002 and 2001


                                Table of Contents
                                -----------------

                                                                            Page
                                                                            ----
Independent Auditors' Report                                                 F-1

Consolidated Financial Statements

         Consolidated Balance Sheets                                         F-2

         Consolidated Statements of Operations                               F-3

         Consolidated Statement of Changes in Stockholders'
          (Deficit) Equity                                                   F-4

         Consolidated Statements of Cash Flows                               F-5

Notes to Consolidated Financial Statements                                   F-7



<PAGE>


                          INDEPENDENT AUDITORS' REPORT



Board of Directors and Stockholders
Pak Mail Centers of America, Inc. and Subsidiary
Aurora, Colorado


We have audited the accompanying consolidated balance sheets of Pak Mail Centers
of America, Inc. and Subsidiary as of November 30, 2002 and 2001, and the
related consolidated statements of operations, stockholders' equity (deficit)
and cash flows for the years ended November 30, 2002, 2001 and 2000. These
consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audits.

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

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Pak Mail Centers of
America, Inc. and Subsidiary as of November 30, 2002 and 2001, and the results
of their operations and their cash flows for the years ended November 30, 2002,
2001 and 2000 in conformity with accounting principles generally accepted in the
United States of America.

                                        /s/  Ehrhardt Keefe Steiner & Hottman PC
                                        ----------------------------------------
                                             Ehrhardt Keefe Steiner & Hottman PC


January 9, 2003
Denver, Colorado

                                      F-1

<PAGE>
<TABLE>
<CAPTION>

                       PAK MAIL CENTERS OF AMERICA, INC. AND SUBSIDIARY


                                  Consolidated Balance Sheets

                                                                          November 30,
                                                                   --------------------------
                                                                      2002           2001
                                                                   -----------    -----------
                                            Assets
Current assets
   <S>                                                             <C>            <C>
   Cash and cash equivalents                                       $   134,762    $    17,201
   Restricted cash                                                      75,516        138,406
   Trade accounts receivable, less allowance for doubtful
    accounts of $78,335 (2002) and $69,677 (2001)                      555,399        544,192
   Inventories                                                          40,816         30,225
   Notes receivable - current, less allowance for doubtful
    accounts of $16,368 (2002) and $31,115 (2001)                      168,494        115,523
   Prepaid expenses and other current assets                             9,583         55,588
   Deferred income taxes                                                  --          132,734
                                                                   -----------    -----------
        Total current assets                                           984,570      1,033,869
                                                                   -----------    -----------
Non-current assets
   Property and equipment, net                                          50,761         85,413
   Notes receivable, net of current portion                             10,248        184,447
   Capitalized software, net                                              --          571,956
   Deferred franchise costs                                              4,000         16,770
   Deposits and other                                                  119,278        112,868
                                                                   -----------    -----------
        Total non-current assets                                       184,287        971,454
                                                                   -----------    -----------
Total assets                                                       $ 1,168,857    $ 2,005,323
                                                                   ===========    ===========

                             Liabilities and Stockholders' Equity

Current liabilities
   Trade accounts payable                                          $   107,518    $   203,042
   Accrued other                                                       360,011        348,617
   Deferred rent                                                        56,903         64,776
   Preferred stock dividends payable                                   133,000        133,000
   Current portion of capital lease obligation                           9,798         10,520
   Due to advertising fund                                              75,516        138,406
   Current portion of post employment benefits                         181,967           --
   Deferred franchise revenues                                          97,200        127,820
                                                                   -----------    -----------
        Total current liabilities                                    1,021,913      1,026,181
                                                                   -----------    -----------
Non-current liabilities
   Deferred franchise revenues                                         308,039        498,385
   Note payable - stockholders                                         400,000        400,000
   Capital lease obligations, less current portion                        --           11,088
   Post employment benefits                                             44,902           --
                                                                   -----------    -----------
        Total non-current liabilities                                  752,941        909,473
                                                                   -----------    -----------
        Total liabilities                                            1,774,854      1,935,654
                                                                   -----------    -----------
Commitments
stockholders' (deficit) equity
   Series C redeemable preferred stock, $1,000 par value; 6%
    cumulative; 2,500 shares authorized, 2,216 shares issued and
    outstanding (liquidation preference $2,482,668)                  2,216,668      2,216,668
   Common stock, $.001 par value; 200,000,000 shares
    authorized, 3,877,737 shares  issued and outstanding                 3,877          3,877
   Additional paid-in capital                                        5,113,992      5,113,992
   Accumulated deficit                                              (7,940,534)    (7,264,868)
                                                                   -----------    -----------
        Total stockholders' (deficit) equity                          (605,997)        69,669
                                                                   -----------    -----------
Total liabilities and stockholders' (deficit) equity               $ 1,168,857    $ 2,005,323
                                                                   ===========    ===========


                       See notes to consolidated financial statements.

                                             F-2
<PAGE>

                          PAK MAIL CENTERS OF AMERICA, INC. AND SUBSIDIARY


                                Consolidated Statements of Operations



                                                                   For the Years Ended
                                                                        November 30,
                                                         -----------------------------------------
                                                            2002           2001           2000
                                                         -----------    -----------    -----------

Revenues
   Royalties from franchisees                            $ 2,676,822    $ 2,715,152    $ 2,709,764
   Franchise fees                                          1,041,005        875,099      1,063,315
   Sales of products and services                            779,357        643,639        836,082
   Software license fees                                        --          121,170        301,175
   Other income                                              113,524        133,398        235,800
                                                         -----------    -----------    -----------
        Total revenues                                     4,610,708      4,488,458      5,146,136
                                                         -----------    -----------    -----------

Operating expenses
   Selling, general and administrative                     1,720,472      1,989,770      2,596,832
   Cost of products and services                             842,527        730,848        852,732
   Royalties paid to area franchisees                      1,142,519      1,135,805      1,070,974
   Commissions on franchise sales                            451,701        355,343        398,884
   Advertising                                                85,180        133,164        171,844
   Depreciation and amortization                              58,494        139,573        224,839
   Post employment expenses                                  272,233           --             --
   Impairment of capitalized software                        571,956           --          557,853
   Loss on disposal of assets                                   --             --           12,221
                                                         -----------    -----------    -----------
        Total operating expenses                           5,145,082      4,484,503      5,886,179
                                                         -----------    -----------    -----------

(Loss) income from operations                               (534,374)         3,955       (740,043)
                                                         -----------    -----------    -----------

Other income (expense)
   Interest income and other                                  13,358         19,198         16,653
   Interest expense                                          (21,916)       (44,065)       (63,193)
                                                         -----------    -----------    -----------
        Total other income (expense)                          (8,558)       (24,867)       (46,540)
                                                         -----------    -----------    -----------

Loss before income tax expense                              (542,932)       (20,912)      (786,583)

Income tax expense                                          (132,734)      (214,766)          --
                                                         -----------    -----------    -----------

Net loss                                                    (675,666)      (235,678)      (786,583)
Preferred stock dividend                                        --          133,000        133,000
                                                         -----------    -----------    -----------

Net loss available to Common Stockholders                $  (675,666)   $  (368,678)   $  (919,583)
                                                         ===========    ===========    ===========

Net loss per share - basic and diluted                   $     (0.17)   $     (0.10)   $     (0.24)
                                                         ===========    ===========    ===========

Weighted average common shares outstanding - basic and
 diluted                                                   3,877,737      3,875,158      3,873,737
                                                         ===========    ===========    ===========


                          See notes to consolidated financial statements.

                                                 F-3
<PAGE>

                                         PAK MAIL CENTERS OF AMERICA, INC. AND SUBSIDIARY


                                Consolidated Statement of Changes in Stockholders' (Deficit) Equity

                                       For the Years Ended November 30, 2002, 2001 and 2000



                                   Preferred Stock
                                      Series C                   Common Stock          Additional                      Total
                              -------------------------   -------------------------     Paid-in      Accumulated    Stockholders'
                                 Shares        Amount        Shares        Amount       Capital         Deficit       Deficit
                              -----------   -----------   -----------   -----------   -----------    -----------    -----------

Balance - November 30, 1999         2,216   $ 2,216,668     3,873,737   $     3,874   $ 5,113,995    $(5,976,607)   $ 1,357,930

Net loss                             --            --            --            --            --         (919,583)      (919,583)
                              -----------   -----------   -----------   -----------   -----------    -----------    -----------

Balance - November 30, 2000         2,216     2,216,668     3,873,737         3,874     5,113,995     (6,896,190)       438,347

Stock issuance                       --            --           4,000             3            (3)          --             --

Net loss                             --            --            --            --            --         (368,678)      (368,678)
                              -----------   -----------   -----------   -----------   -----------    -----------    -----------

Balance - November 30, 2001         2,216     2,216,668     3,877,737         3,877     5,113,992     (7,264,868)        69,669

Net loss                             --            --            --            --            --         (675,666)      (675,666)
                              -----------   -----------   -----------   -----------   -----------    -----------    -----------

Balance - November 30, 2002         2,216   $ 2,216,668     3,877,737   $     3,877   $ 5,113,992    $(7,940,534)   $  (605,997)
                              ===========   ===========   ===========   ===========   ===========    ===========    ===========


                                         See notes to consolidated financial statements.

                                                               F-4
<PAGE>

                     PAK MAIL CENTERS OF AMERICA, INC. AND SUBSIDIARY


                           Consolidated Statements of Cash Flows



                                                            For the Years Ended
                                                               November 30,
                                                    -----------------------------------
                                                       2002         2001         2000
                                                    ---------    ---------    ---------
Cash flows from operating activities
   Net loss                                         $(675,666)   $(368,678)   $(919,583)
                                                    ---------    ---------    ---------
   Adjustments to reconcile  to net cash provided
    by operating activities
     Depreciation and amortization                     58,494      139,573      224,839
     Loss on disposal of assets                       571,956         --        557,853
     Preferred stock dividends payable                   --        133,000      133,000
     Change in provision for loss on accounts
      receivable                                        8,658      (57,761)       8,278
     Provision for loss on notes receivable           (14,747)      13,107       27,086
     Bad debts                                        126,000      102,000      255,381
     Deferred franchise costs                          12,770       30,901      (15,860)
     Deferred income taxes                            132,734      214,766         --
     Post employment benefit                          226,869         --           --
     Changes in assets and liabilities
       Accounts receivable                            (67,118)     (31,994)    (235,595)
       Inventories                                    (10,591)      14,058       57,074
       Prepaid expenses and other current assets       46,005      (32,902)       6,588
       Trade accounts payable                         (95,524)    (114,189)       1,856
       Accrued expenses and deferred rent               3,521      130,300      (77,108)
       Deferred revenue                              (220,966)      19,085       (6,899)
       Due to advertising fund                        (62,890)     127,277        9,249
                                                    ---------    ---------    ---------
                                                      715,171      687,221      945,742
                                                    ---------    ---------    ---------
        Net cash provided by operating activities      39,505      318,543       26,159
                                                    ---------    ---------    ---------
Cash flows from investing activities
   Capital expenditures                                (6,426)      (9,102)     (82,799)
   Capitalized software costs                            --       (197,299)    (211,880)
   Deposits and other                                 (23,826)      32,803      (11,372)
   Payments on notes receivable                        57,228      143,053      109,154
                                                    ---------    ---------    ---------
        Net cash provided by (used in) investing
         activities                                    26,976      (30,545)    (196,897)
                                                    ---------    ---------    ---------
Cash flows from financing activities
   Payments on notes payable and capital lease
    obligations                                       (11,810)     (10,520)     (31,549)
   Advances on notes payable                             --           --        300,000
   Preferred stock dividends paid                        --       (133,000)    (133,000)
   Restricted cash                                     62,890     (127,277)      (9,249)
                                                    ---------    ---------    ---------
        Net cash provided by (used in) financing
         activities                                    51,080     (270,797)     126,202
                                                    ---------    ---------    ---------
Net increase (decrease) in cash                       117,561       17,201      (44,536)
Cash - beginning of year                               17,201         --         44,536
                                                    ---------    ---------    ---------
Cash - end of year                                  $ 134,762    $  17,201    $    --
                                                    =========    =========    =========

(Continued on next page.)

                     See notes to consolidated financial statements.

                                           F-5
</TABLE>
<PAGE>


                PAK MAIL CENTERS OF AMERICA, INC. AND SUBSIDIARY


                      Consolidated Statements of Cash Flows


(Continued from previous page.)


Supplemental disclosure of cash flow information

Cash paid for:                           Interest
                                        ----------
       2002                             $   21,916
       2001                             $   44,065
       2000                             $   63,193


Supplemental disclosure of non-cash activity:

         At November 30, 2002, 2001 and 2000 $0, $0 and $49,170 of notes
         receivable additions are included in deferred revenue, respectively.

         During 2000, the Company incurred capital lease obligations and
         recorded related equipment of $43,677.


                See notes to consolidated financial statements.

                                      F-6

<PAGE>


                PAK MAIL CENTERS OF AMERICA, INC. AND SUBSIDIARY

                   Notes to Consolidated Financial Statements


Note 1 - Description of Business and Summary of Significant Accounting Policies
-------------------------------------------------------------------------------

Pak Mail Centers of America, Inc., (the Company), was incorporated in Colorado
in 1984 and is engaged in the business of marketing and franchising Pak Mail
Retail and Service Centers, which specialize in custom packaging of items to be
mailed or shipped throughout the United States and Mexico.

The following table summarized the number of Pak Mail Retail and Service Centers
in operation during the last three fiscal years:

                                                                November 30,
                                                            --------------------
                                                            2002    2001    2000
                                                            ----    ----    ----
Franchises:
     Franchise centers in operation:
         Domestic                                            346     338     345
         International                                        47      45      44
     Rights to franchise centers sold and not in
         operation                                            12      22      29
                                                            ----    ----    ----
                                                             401     405     418
                                                            ====    ====    ====


Principles of Consolidation
---------------------------

The accompanying consolidated financial statements include the accounts of Pak
Mail Centers of America, Inc. and its subsidiary, Pak Mail Crating and Freight
Services, Inc. All intercompany accounts and transactions have been eliminated
in consolidation.

Cash and Cash Equivalents
-------------------------

The Company considers all highly liquid instruments purchased with an original
maturity of three months or less to be cash equivalents. The Company continually
monitors its positions with, and the credit quality of, the financial
institutions it invests with. As of the balance sheet date, and periodically
throughout the year, the Company has maintained balances in various operating
accounts in excess of federally insured limits.

Concentrations of Credit Risk
-----------------------------

Financial instruments, which potentially subject the Company to concentration of
credit risk, consist principally of cash and cash equivalents, and accounts and
notes receivable from franchisees, area developers and marketing directors. The
Company places its temporary cash investments with what management believes are
high-credit, quality financial institutions. To reduce credit risk, the Company
reserves the right to terminate franchise agreements for non-payment of amounts
owed. Additionally, as of November 30, 2002 and 2001, approximately $130,000 and
$183,000 of notes receivable are offset by comparable amounts in deferred
revenue.

                                      F-7

<PAGE>


                PAK MAIL CENTERS OF AMERICA, INC. AND SUBSIDIARY

                   Notes to Consolidated Financial Statements


Fair Value of Financial Instruments
-----------------------------------

The carrying amounts of financial instruments including accounts receivable,
accounts payable and accrued expenses approximated fair value as of November 30,
2002 because of the relatively short maturity of these instruments.

The carrying amounts of notes receivable, capital lease obligations, and debt
outstanding approximate fair value as of November 30, 2002 because interest
rates and discount rates on these instruments approximate market interest rates.

Inventories
-----------

Inventory consists of equipment and supplies held for resale to franchisees for
use at their store locations or held at corporate owned stores for resale to the
public and is stated at the lower of cost or market, determined using the
first-in, first-out method (FIFO).

Property and Equipment
----------------------

Property and equipment is stated at cost. Depreciation is provided utilizing the
straight-line method over the estimated useful lives for owned assets, ranging
from 3 to 7 years.

Long-Lived Assets
-----------------

The Company reviews its long-lived assets for impairment whenever events or
changes in circumstances indicate that the carrying amount of the asset may not
be recovered. The Company looks primarily to the undiscounted future cash flows
in its assessment of whether or not long-lived assets have been impaired.

Use of Estimates
----------------

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

The Company has recorded an allowance for doubtful collections on accounts
receivable and notes receivable. These are continually reviewed based upon
changes in the nature of the amounts outstanding. Accordingly, the allowances
are subject to change due to circumstances not presently known.

The Company has recorded a valuation allowance for potentially unrealizable
deferred tax assets. This allowance is reviewed based upon historical and
projected financial results of the Company. Accordingly, the allowance is
subject to changes due to circumstances not presently known.

Deferred Rent
-------------

The Company was granted upfront free rent periods on its office facility. The
accompanying financial statements reflect rent expense on a straight-line basis
over the term of the lease.

                                      F-8

<PAGE>


                PAK MAIL CENTERS OF AMERICA, INC. AND SUBSIDIARY

                   Notes to Consolidated Financial Statements


Deferred Financing Costs
------------------------

Costs related to the development of the franchise operations are capitalized and
amortized over the expected period of benefit of five years. These costs are
primarily comprised of costs incurred to develop the franchise documents.

Incremental direct development costs, such as commissions, are deferred, but not
in excess of the deferred revenue and are expensed when the related franchise
fee revenue is recognized.

Revenue Recognition
-------------------

The Company has awarded franchise rights under the following franchise
agreements:

o    Individual franchise agreement - Right to operate one store at a location
     to be determined. Franchise fees are payable in cash or notes upon
     execution of agreement.

o    Area developer agreement - Right to develop stores within a specified
     geographic area. The area franchise fee (based upon the estimated
     development potential of the area) is payable in cash and notes upon
     execution of the area developer agreement. Upon awarding of individual
     franchises within the franchise area, the Company typically received 60% of
     the individual franchise fee and the area developer receives 40%. The area
     developer receives 50% to 60% of the royalties from individual franchisees
     within the area. Although the Company currently has several franchises
     operating under this agreement, during fiscal year 1994, the Company
     changed the terms of this agreement as specified in the area marketing
     agreement below.

o    Area marketing agreement - Right to market franchises within a specified
     geographic region. The area marketing fee is payable in cash and notes upon
     execution of the area marketing agreement. Upon selling of individual
     franchises within the area, the Company typically receives 60% of the
     individual franchise fee and the area marketer receives 40%. The area
     marketer receives 50% of the royalties from individual franchisees within
     the area.

o    International area franchise agreement - Right to market franchises within
     a designated country or specified geographic region. The international
     franchise fee is payable in cash and notes upon execution of the franchise
     agreement. The Company's participation in franchise fees and royalties for
     individual franchises sold within the international area are negotiated on
     a case-by-case basis. Additionally, the Company agrees to train all new
     individual franchisees for a flat fee.

Revenue Recognition (continued)
-------------------------------

Individual franchise fees outside a marketing or development area are recognized
as revenue when all material services and conditions relating to the sale have
been substantially performed by the Company and the franchise has commenced
operations.

The Company recognizes marketing agreement fees on a straight-line basis over
the effective term of the agreement, which is five years or as stores within the
area are opened.

Individual franchise fees within a domestic area are recognized as revenue when
all material services and conditions relating to the sale have been
substantially performed by the Company, principally site selection and training.

International area franchise fees are deferred and the revenue is not recognized
until training provided to the international area marketer is completed and
collection of notes receivable is reasonably assured.

                                      F-9
<PAGE>


                PAK MAIL CENTERS OF AMERICA, INC. AND SUBSIDIARY

                   Notes to Consolidated Financial Statements


Royalties from Franchisees
--------------------------

Royalties from individual franchisees are based upon a percentage of each
franchisee's sales and are recognized when earned based upon reported sales
activity by each franchisee.

Software Revenue Recognition
----------------------------

The Company's software products were generally licensed to franchisees for a
one-time initial fee and subsequent annual license and maintenance fees. The
initial license fee was recognized as revenue upon execution of a signed
contract, delivery of licensed software and when the Company believed that the
collection of the receivable was probable. Revenue on annual license fees were
recognized over the related 12 month period. During 2001, the Company determined
that its software was not working as intended and therefore, revenue is no
longer recognized on software licenses.

Sales Equipment, Supplies and Services
--------------------------------------

Revenue is recognized as product is shipped or services rendered.

Advertising Costs
-----------------

The Company expenses advertising costs as incurred.

Income Taxes
------------

The Company recognizes deferred tax liabilities and assets for the expected
future tax consequences of events that have been included in the financial
statements or tax returns. Deferred tax liabilities and assets are determined
based on the differences between the financial statement and tax basis of assets
and liabilities using the enacted tax rates in effect for the year in which the
differences are expected to reverse. The measurement of deferred tax assets is
reduced, if necessary, by the amount of any tax benefits that are not expected
to be realized based on available evidence.

                  Note 12 - Income Taxes (TAKEN FROM QUIZNO'S)

Software Development Costs
--------------------------

The Company applies the provisions of Statement of Position 98-1, "Accounting
for Costs of Computer Software Developed for Internal Use". The Company accounts
for costs incurred in the development of computer software as software research
and development costs until the preliminary project stage is completed.
Capitalized software costs consist of costs of internally developed software
developed for sale to franchisees. Capitalization of internally developed
software costs begins upon the establishment of the technological feasibility of
a product. The recoverability of capitalized software costs requires
considerable judgment by management with respect to certain external factors,
including, but not limited to, technological feasibility, anticipated future
gross revenues, estimated economic life and changes in software and hardware
technologies. Amortization of internally developed software costs are provided
on a product-by-product basis using the amount computed by the straight-line
method over the remaining economic life of the product. Generally, an original
estimated economic life of three years is assigned to capitalized costs. The
software was placed in service by a majority of the franchises in February 2000.
As such, amortization in 2000 was $81,390.

                                      F-10
<PAGE>

                PAK MAIL CENTERS OF AMERICA, INC. AND SUBSIDIARY

                   Notes to Consolidated Financial Statements


After two months of use, it became apparent that the software was not working as
intended. The Company contracted with a software development company to rewrite
a significant portion of the program for approximately $230,000. Management's
analysis indicated that approximately $557,853 of the original capitalized asset
needed to be written off as an impaired asset.

In May of 2001 the Company determined that it had no more funds to commit to
finishing the development of the software. Accordingly, an agreement was reached
with ReSource Software, Inc. to continue development of the software at their
expense and then market the finished product and split the revenue. The Company
also received 350 ReSource point of sale software licenses for use by the
Company's stores for $55,000 to be paid over one year.

In August 2002, the Company determined that the point of sale software could not
easily be integrated with Resource Software, Inc. Therefore, the remaining
balance was considered impaired and written off in the current year.

Reclassifications
-----------------

Certain amounts in the 2001 and 2000 consolidated financial statements have been
reclassified to conform to the 2002 presentation.

Recently Issued Accounting Pronouncements
-----------------------------------------

In June 2001, the FASB issued SFAS No. 143, "Accounting for Asset Retirement
Obligations." SFAS No. 143 requires the fair value of a liability for an asset
retirement obligation to be recognized in the period in which it is incurred if
a reasonable estimate of fair value can be made. The associated asset retirement
costs are capitalized as part of the carrying amount of the long-lived asset.
SFAS No. 143 is effective for years beginning after June 15,2002. The Company
believes the adoption of this statement will have no material impact on its
consolidated financial statements.

In August 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets." SFAS 144 requires that those long-lived assets
be measured at the lower of carrying amount or fair value, less cost to sell,
whether reported in continuing operations or in discontinued operations.
Therefore, discontinued operations will no longer be measured at net realizable
value or include amounts for operating losses that have not yet occurred. SFAS
144 is effective for financial statements issued for fiscal years beginning
after December 15, 2001 and, generally, are to be applied prospectively. The
Company believes that the adoption of this statement will have no material
impact on its consolidated financial statements.

In April 2002, the FASB issued SFAS No. 145, "Rescission of FASB No. 4, 44 and
64, Amendment of FASB No. 13, and Technical Corrections." SFAS rescinds FASB No.
4 "Reporting Gains and Losses from Extinguishments of Debt Made to Satisfy
Sinking-Fund Requirements." This statement also rescinds SFAS No. 44 "Accounting
for Intangible Assets of Motor Carriers" and amends SFAS No. 13, "Accounting for
Leases". This statement is effective for fiscal years beginning after May 15,
2002. The Company does not expect the adoption of this statement to have a
material effect on the Company's financial statements.

In June 2002, the FASB issued SFAS No. 146, "Accounting for Costs Associated
with Exit or Disposal Activities." SFAS No. 146 addresses accounting and
reporting for costs associated with exit or disposal activities and nullifies
Emerging Issues Task Force Issue No. 94-3, "Liability Recognition for Certain
Employee Termination Benefits and Other Costs to Exit an Activity (Including
Certain Costs Incurred in a Restructuring)." SFAS No. 146 requires that a

                                      F-11
<PAGE>

                PAK MAIL CENTERS OF AMERICA, INC. AND SUBSIDIARY

                   Notes to Consolidated Financial Statements


liability for a cost associated with an exit or disposal activity be recognized
and measured initially at fair value when the liability is incurred. SFAS No.
146 is effective for exit or disposal activities that are initiated after
December 31, 2002, with early application encouraged. The Company does not
expect the adoption of this statement to have a material effect on the Company's
financial statements.

Recently Issued Accounting Pronouncements (continued)
-----------------------------------------------------

In November 2002, the FASB published interpretation No, 45 "Guarantor's
Accounting and Disclosure requirements for Guarantees, Including Indirect
Guarantees of Indebtedness of Others". The Interpretation expands on the
accounting guidance of Statements No. 5, 57, and 107 and incorporates without
change the provisions of FASB Interpretation No. 34, which is being superseded.
The Interpretation elaborates on the existing disclosure requirements for most
guarantees, including loan guarantees such as standby letters of credit. It also
clarifies that at the time a company issues a guarantee, the company must
recognize an initial liability for the fair value, or market value, of the
obligations it assumes under that guarantee and must disclose that information
in its interim and annual financial statements. The initial recognition and
initial measurement provisions apply on a prospective basis to guarantees issued
or modified after December 31, 2002, regardless of the guarantor's fiscal
year-end. The disclosure requirements in the Interpretation are effective for
financial statements of interim or annual periods ending after December 15,
2002. The Company does not expect the adoption of this statement to have a
material effect on the Company's financial statements.

In December 2002, the FASB issued SFAS No. 148 "Accounting for Stock-Based
Compensation- Transition and Disclosure", which amends FASB Statement No. 123,
"Accounting for Stock-Based Compensation" to provide alternative methods of
transition for an entity that voluntary changes to the fair value method of
accounting for stock-based compensation. In addition, this Statement amends the
disclosure requirement provision of Statement No. 123 to require more prominent
disclosure about the effects of an entity's accounting policy decisions with
respect to stock-based employee compensation on reported net income. SFAS No.
148 is effective for fiscal years ended after December 15, 2002. The Company
does not expect the adoption of this statement to have a material effect on the
Company's financial statements.


Note 2 - Balance Sheet Disclosures
----------------------------------

Software development costs consist of the following:

                                                            November 30,
                                                       2002              2001
                                                     ---------        ---------

PSS version 1                                        $    --          $ 293,000
PSS version 2                                             --            409,329
Less accumulated amortization                             --           (130,373)
                                                     ---------        ---------
                                                     $    --          $ 571,956
                                                     =========        =========

                                      F-12
<PAGE>

                PAK MAIL CENTERS OF AMERICA, INC. AND SUBSIDIARY

                   Notes to Consolidated Financial Statements


Property and equipment consist of the following:

                                                              November 30,
                                                        -----------------------
                                                          2002          2001
                                                        ---------     ---------
Office equipment                                        $ 211,789     $ 205,362
Furniture and fixtures                                    228,089       228,089
                                                        ---------     ---------
                                                          439,878       433,451
Less accumulated depreciation                            (389,117)     (348,038)
                                                        ---------     ---------
                                                        $  50,761     $  85,413
                                                        =========     =========

Depreciation expense for the periods ended is:


2002                                                    $  41,078
2001                                                    $  59,945
2000                                                    $  87,031


Note 3 - Notes Receivable
-------------------------

Notes receivable consist of franchise fees and area marketer fees financed by
the Company. The notes are collateralized by the underlying franchise agreements
and by essentially all of the franchisees' assets incidental to the operation of
the franchise centers. Most of the notes are personally guaranteed by the owners
of each franchise.

Notes receivable consist of the following:

                                                              November 30,
                                                        -----------------------
                                                          2002          2001
                                                        ---------     ---------

Non-interest bearing notes; interest imputed at 8%      $ 146,759     $ 255,492

Interest-bearing notes; interest rates from 6 to 8%        48,351        75,593
                                                        ---------     ---------
                                                          195,110       331,085
Less current portion                                     (168,494)     (115,523)
                                                        ---------     ---------
                                                           26,616       215,562
Less allowance                                            (16,368)      (31,115)
                                                        ---------     ---------
                                                        $  10,248     $ 184,447
                                                        =========     =========

The Company reserves an allowance for doubtful collections which is continually
reviewed and adjusted to maintain the allowance at a level considered adequate
to cover future losses. The allowance is management's best estimate of
uncollectible amounts and is determined based on historical performance of the
notes, which is tracked by the Company on an ongoing basis. The losses
ultimately incurred could differ materially in the near term from the amounts
estimated in determining the allowance. The Company collateralizes the notes
with the area directorship agreement, assets of the store sold or other related
assets.

It is the Company's policy not to impute interest on the notes which are
included in deferred revenue. Included in these notes are financed area marketer
fees, the maturities of which are based upon the expected opening of franchises
within the area.

                                      F-13
<PAGE>

                PAK MAIL CENTERS OF AMERICA, INC. AND SUBSIDIARY

                   Notes to Consolidated Financial Statements


The above amounts are scheduled to mature as follows:

Year Ending November 30,
------------------------

     2003                                        $   168,494
     2004                                             24,554
     2005                                              2,062
                                                 -----------
                                                     195,110
     Less allowance                                  (16,368)
                                                 -----------
                                                 $   178,742
                                                 ===========


Note 4 - Income Taxes
---------------------

The Company recognizes deferred tax assets and liabilities for the expected
future tax consequences of events that have been included in the financial
statements or tax returns. The Company has recorded a valuation allowance on its
net deferred tax assets as management is unable to determine if the deferred tax
assets will be realized.

Temporary differences and carryforwards giving rise to a significant portion of
deferred tax assets and liabilities are as follows:

                                                          November 30,
                                                 ------------------------------
                                                    2002               2001
                                                 -----------        -----------
Net operating loss carryforwards                 $ 1,760,000        $ 2,414,117
Reserves and other deferrals                         119,000           (138,000)
Depreciation and amortization                         13,400            (15,000)
Valuation allowance                               (1,892,400)        (2,128,383)
                                                 -----------        -----------
                                                 $      --          $   132,734
                                                 ===========        ===========

As of November 30, 2002, the Company has net operating loss carryforwards for
tax purposes of approximately $5,176,000.

If not used, these carryforwards will expire in varying amounts as follows.

Year Ending November 30,
------------------------

     2003                                        $    65,000
     2004                                            507,000
     2005                                          1,061,000
     2006                                          1,183,000
     2007                                            738,000
     2008                                            610,000
     2009                                            622,000
     2019                                              3,000
     2020                                            242,000
     2021                                            145,000
                                                 -----------
                                                 $ 5,176,000
                                                 ===========

                                      F-14
<PAGE>

                PAK MAIL CENTERS OF AMERICA, INC. AND SUBSIDIARY

                   Notes to Consolidated Financial Statements


The following is a reconciliation of the statutory federal income tax rate
applied to pre-tax accounting net loss compared to the income taxes in the
consolidated statements of operations as of November 30, 2002:

                                                   For the Years Ended
                                                      November 30,
                                          -------------------------------------
                                             2002          2001          2000
                                          ---------     ---------     ---------

Income tax benefit                        $(235,983)    $ (68,117)    $(267,438)

Change resulting from:
Change in valuation allowance               235,983       282,883       267,438
Write down of deferred tax assets           132,734          --            --
                                          ---------     ---------     ---------

Provision for income tax expense          $ 132,734     $ 214,766     $    --
                                          =========     =========     =========


Note 5 - Subordinated Debt
--------------------------

The Company has a long-term $400,000 note payable to the Company's majority
stockholder requiring interest only payments monthly with any unpaid principal
and interest due on demand subsequent to January 2004. The note accrues interest
at the prime rate (4.25% at November 30, 2002); however, the interest rate at no
time will exceed 11% or be less than 8%. This note is unsecured.


Note 6 - Capital Leases
-----------------------

The Company has acquired assets under the provisions of long-term leases. For
financial reporting purposes, minimum lease payments relating to the assets have
been capitalized. The lease expires in August 29, 2003. Amortization of the
leased property is included in depreciation expense.

The assets under capital lease have cost and accumulated amortization as
follows:

                                                                November 30,
                                                           --------------------
                                                             2002        2001
                                                           --------    --------
Capitalized leases                                         $ 43,677    $ 43,677
Less accumulated amortization                               (35,488)    (24,568)
                                                           --------    --------
                                                           $  8,189    $ 19,109
                                                           ========    ========

Maturities of capital lease obligations are as follows:

Year Ending November 30,
------------------------

     2003                                                  $ 10,184
     Amount representing interest                              (386)
                                                           --------
     Present value of net minimum lease payments              9,798
     Less current portion                                    (9,798)
                                                           --------

     Long-term capital lease obligation                    $   --
                                                           ========

                                      F-15
<PAGE>

                PAK MAIL CENTERS OF AMERICA, INC. AND SUBSIDIARY

                   Notes to Consolidated Financial Statements


Note 7 - Commitments
--------------------

Operating Leases
----------------

The Company leases office space and office equipment under noncancelable
operating leases.

Rent expense for these leases was:

Year Ended November 30,
-----------------------

     2002                                      $  273,261
     2001                                      $  264,618
     2000                                      $  341,851

Operating Leases (continued)
----------------------------

Future minimum lease payments under these leases are approximately as follows:

Year Ending November 30,
------------------------

     2003                                      $  266,000
     2004                                         264,000
     2005                                         263,000
     2006                                         109,000
                                               ----------
                                               $  902,000
                                               ==========

Post Employment Benefit
-----------------------

Effective March 1, 2002, the Company entered into an employment agreement with
John Kelly, requiring total post retirement payments totaling $362,987. The
agreement provided that John Kelly resign as President, Chief Executive Director
and be named Chairman of the Board. As of September 30, 2002, John Kelly was no
longer active in the Company's affairs and as a result the Company expensed the
remaining $272,233 of unpaid benefits. On January 16, 2003, John Kelly resigned
as Chairman of the Board. The Company's future obligations under this agreement
as of November 30, 2002 are $181,967 and $44,902 for fiscal years 2003 and 2004,
respectively. This agreement expires February 2004.


Note 8 - Stockholders' Equity
-----------------------------

Preferred Stock
---------------

Dividends on the Series C Preferred Stock will accrue at 6% per year commencing
December 1, 1997. Dividends are payable annually only to the extent that the
Company's net income from December 1 1993 exceeds the product of $200,000
multiplied by the number of years elapsed from December 1, 1993 through the last
day of the fiscal years next preceding dividend payment date. Dividend payment
dates commenced on March 31, 1999 and continue each March 31 thereafter.

                                      F-16
<PAGE>

                PAK MAIL CENTERS OF AMERICA, INC. AND SUBSIDIARY

                   Notes to Consolidated Financial Statements


Dividends have not been declared in fiscal year 2002 as the Company has a
stockholders' deficit as of November 30, 2002 and therefore, is unable to
declare or pay dividends. Cumulative undeclared and unpaid dividends were
$266,000 and $133,000 at November 30, 2002 and 2001, respectively. As dividends
have not been declared as of November 30, 2002 the current year accrual of
$133,000 has not been made in the accompanying financial statements. The
preferred stock does not vote although holders of 51% must approve certain items
such as any changes in control, sale of the Company or a sale of the majority of
the Company's assets. The Series C Preferred Stock may be redeemed at the
Company's option any time at $1,000 per share plus accrued dividends.

Stock Options
-------------

The 1999 Incentive and Non-statutory Stock Option Plan (the Plan) authorizes the
issuance of up to 400,000 shares of the Company's Common Stock. The Plan will
remain in effect until December 31, 2008 unless terminated earlier by action of
the Board. All employees of the Company are eligible to receive options under
the Plan at the discretion of the Board. Options issued under the Plan vest
one-third per year upon each of the first three anniversaries of the issue date
and have a term of ten years from the date of issue.

The following table presents the activity for options outstanding:

                                                                        Weighted
                                                         Incentive       Average
                                                           Stock        Exercise
                                                          Options         Price
                                                         --------       --------
Outstanding - November 30, 1999                           161,841       $   0.75
         Granted                                             --             --
         Forfeited/canceled                               (33,743)          0.75
         Exercised                                           --             --
                                                         --------       --------

Outstanding - November 30, 2000                           128,098           0.75
         Granted                                             --             --
         Forfeited/canceled                               (19,938)          0.75
         Exercised                                           --             --
                                                         --------       --------

Outstanding - November 30, 2001                           108,160           0.75
         Granted                                             --             --
         Forfeited/canceled                                  --             --
         Exercised                                           --             --
                                                         --------       --------

Outstanding - November 30, 2002                           108,160       $   0.75
                                                         ========       ========

The following table presents the composition of options outstanding and
exercisable:

                               Options Outstanding           Options Exercisable
                               -------------------  -------  -------------------
 Range of Exercise Prices       Number    Price*    Life*     Number    Price*
---------------------------     -------   -------   -------   -------   -------
         .75                    108,160   $  0.75      6.00   108,160   $  0.75
                                -------   -------   -------   -------   -------

Total - November 30, 2002       108,160   $  0.75      6.00   108,160   $  0.75
                                =======   =======   =======   =======   =======

*Price and Life reflect the weighted average exercise price and weighted average
  remaining contractual life, respectively.

                                      F-17
<PAGE>


                PAK MAIL CENTERS OF AMERICA, INC. AND SUBSIDIARY

                   Notes to Consolidated Financial Statements


Stock Options (continued)

The Company has adopted the disclosure-only provisions of Statement of Financial
Accounting Standards No. 123, "Accounting for Stock-Based Compensation."
Accordingly, no compensation cost has been recognized for the stock option
plans. Had compensation cost for the Company's option plan been determined based
on the fair value at the grant date for awards consistent with the provisions of
SFAS No. 123, the Corporation's net loss and basic loss per common share would
have been changed to the pro forma amounts indicated below:

                                                   For the Years Ended
                                                       November 30,
                                           -----------------------------------
                                              2002         2001         2000
                                           ---------    ---------    ---------

Net loss - as reported                     $(675,666)   $(368,678)   $(919,583)
Net income - pro forma                          --           --           --
Basic loss per common share - as reported      (0.17)       (0.10)       (0.24)
Basic loss per common share - pro forma        (0.21)       (0.10)       (0.24)

The Company utilizes the Black-Scholes option-pricing model to calculate the
fair value of each individual issuance of options. The Company had no stock
option grants for the years ended November 30, 2002, 2001 and 2000.


Note 9 - Employee Benefit Plan
------------------------------

Effective December 1, 1991, the Company established the Pak Mail 401(k) Profit
Sharing Plan (the Plan). All employees of the Company who are 21 years of age
and have completed one year of eligibility service, as defined, may participate
in the Plan. Participants may make tax deferred contributions in any amount up
to the maximum allowable under current federal tax laws. The Company will
contribute an amount equal to 50% of each participant's contribution, limited to
3% of the participant's compensation as defined in the Plan.

Company contributions to the Plan are as follows:

                                                  For the Years Ended
                                                      November 30,
                                           -----------------------------------
                                              2002         2001         2000
                                           ---------    ---------    ---------
Benefit contributions                      $  16,368    $  19,918    $  27,887
                                           =========    =========    =========


Note 10 - Advertising Fund
--------------------------

The Company has established an advertising trust to administer funds collected
from franchisees for advertising. The advertising trust is a separate legal
entity and, therefore, the Company is not contingently liable for any trust
liabilities incurred; nor is the trust activity reflected in the accompanying
consolidated financial statements.

                                      F-18

<PAGE>


                PAK MAIL CENTERS OF AMERICA, INC. AND SUBSIDIARY

                   Notes to Consolidated Financial Statements


Note 11 - Restricted Cash
-------------------------

At November 30, 2002 and 2001, the amounts collected and due to the advertising
trust of $75,516 and $138,406, respectively, are included in restricted cash.


Note 12 - Subsequent Event
--------------------------

On November 6, 2002, a proxy statement was sent to the SEC detailing a proposed
merger. Under the merger agreement, Pak Mail Acquisition Corp. will be merged
with and into Pak Mail and Pak Mail will be the surviving entity. If the merger
agreement is approved Pak Mail's stockholders will be entitled to receive
$0.0516 per share in cash for their shares of Pak Mail common stock and Pak Mail
Investment Partnership L.P. and D.P. Kelly and associates will own all of the
capital stock of Pak Mail. This proxy has not been declared effective by the SEC
and thus has not been approved by the stockholders as of our report date.

                                      F-19

<PAGE>

                                 CERTIFICATIONS

I, P. Evan Lasky, certify that:

1. I have reviewed this annual report of Pak Mail Centers of America, Inc.;

2. Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to state a material fact necessary in order
to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this
annual report;

3. Based upon my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this annual report;

4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the
period in which this annual report is being prepared;

b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this annual
report (the "Evaluation Date"); and

c) presented in this annual report our conclusions about the effectiveness of
the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent
functions):

a) all significant deficiencies in the design or operation of internal controls
which could adversely affect the registrant's ability to record, process,
summarize and report financial data and have identified for the registrant's
auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls; and

6. The registrant's other certifying officers and I have indicated in this
annual report whether or not there were significant changes in internal controls
or in other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.


Date: February 28, 2003

                                             By: /s/ P. Evan Lasky
                                             --------------------------------
                                             P. Evan Lasky
                                             Chief Executive Officer

<PAGE>

I, P. Evan Lasky, certify that:

1. I have reviewed this annual report of Pak Mail Centers of America, Inc.;

2. Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to state a material fact necessary in order
to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this
annual report;

3. Based upon my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this annual report;

4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the
period in which this annual report is being prepared;

b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this annual
report (the "Evaluation Date"); and

c) presented in this annual report our conclusions about the effectiveness of
the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent
functions):

a) all significant deficiencies in the design or operation of internal controls
which could adversely affect the registrant's ability to record, process,
summarize and report financial data and have identified for the registrant's
auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls; and

6. The registrant's other certifying officers and I have indicated in this
annual report whether or not there were significant changes in internal controls
or in other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.


Date: February 28, 2003

                                             By: /s/ P. Evan Lasky
                                             --------------------------------
                                             P. Evan Lasky
                                             Accounting Supervisor

<PAGE>

                                  EXHIBIT INDEX

(2)(a)*     Agreement and Plan of Merger dated as of October 17, 2002 by and
            between Pak Mail Centers of America, Inc. and Pak Mail Acquisition
            Corp.

(2)(b)*     First Amendment to Agreement and Plan of Merger dated as of October
            28, 2002 by and between Pak Mail Centers of America, Inc and Pak
            Mail Acquisition Corp.

(3)(a)      Articles of Incorporation incorporated by reference to Exhibit
            (3)(a) of the Company's Annual Report on Form 10-KSB for the fiscal
            year ended November 30, 1995.

(3)(b)      Articles of Amendment to the Articles of Incorporation filed with
            the Colorado Secretary of State on January 26, 1998 incorporated by
            reference to Exhibit (3)(b) of the Company's Annual Report on Form
            10-KSB for the fiscal year ended November 30, 1997.

(3)(c)      Articles of Amendment to the Articles of Incorporation filed with
            the Colorado Secretary of State on July 13, 1998, incorporated by
            reference to Exhibit 3(a) of the Company's Quarterly Report on Form
            10-QSB for the quarter ended May 31, 1998.

(3)(d)      Bylaws incorporated by reference to Exhibit 3(b) of the Company's
            Quarterly Report on Form 10-QSB for the quarter ended May 31, 1998.

(10)(a)*    Individual Franchise Agreement.

(10)(b)*    Area Marketing Agreement.

(10)(c)     Pak Mail Centers of America, Inc. Management Incentive Plan for
            Fiscal Year 1998 incorporated by reference to Exhibit (10)(f) of the
            Company's Annual Report on Form 10-KSB for the fiscal year ended
            November 30, 1998.

(10)(d)     Pak Mail Centers of America, Inc. Management Incentive Plan for
            Fiscal Year 1999 incorporated by reference to Exhibit (10)(g) of the
            Company's Annual Report on Form 10-KSB for the fiscal year ended
            November 30, 1998.

(10)(e)     Pak Mail Centers of America, Inc. 1999 Incentive and Non-statutory
            Employee Stock Option Plan incorporated by reference to Exhibit
            (10)(h) of the Company's Annual Report on Form 10-KSB for the fiscal
            year ended November 30, 1998.

(10)(f)     Contract with Immedient, a software development company to re-write
            the PSS software. (Scope Document) incorporated by reference to
            exhibit 10(f) of the Company's Annual Report on Form 10 KSB for the
            fiscal year ending November 30, 2001.

<PAGE>

(10)(g)     Promissory Note, D.P. Kelly & Associates, L.P. incorporated by
            reference to the Company's Annual Report on Form 10-KSB for the
            fiscal year ending November 30, 2001

(10)(h)     Office Lease with Bedford Property Investors for office located at
            7173 South Havana Street, Denver, CO 80112, approximately 12,540
            square feet. (to be filed by amendment) incorporated by reference to
            the Company's Annual Report on Form 10 KSB for the fiscal year
            ending November 30, 2001.

(10)(i)     Resource, Inc. software licensing contract incorporated by reference
            to the Company's Annual Report on Form 10 KSB for the fiscal year
            ending November 30, 2001.

(10)(j)     Employment contract for John E. Kelly, chairman of the board
            incorporated by reference to exhibit 10(j) of the Company's Annual
            Report on Form 10-QSB for the fiscal quarter ending February 28,
            2002

(21)*       Subsidiaries of the Registrant.

(99.1)*     Chief Executive Officer Certification per Sarbanes-Oxley Section 906

(99.2)*     Accounting Supervisor Certification per Sarbanes-Oxley Section 906

----------
     *    Filed herewith.