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


                                  FORM 10-QSB/A


(Mark One)
[ X ]    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
         SECURITIES EXCHANGE ACT OF 1934

         FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2001

[   ]    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
         SECURITIES EXCHANGE ACT OF 1934

         FOR THE TRANSITION PERIOD FROM _______TO________

                         COMMISSION FILE NUMBER: 1-14076

                                  VIZACOM INC.
        (Exact name of small business issuer as specified in its charter)


               DELAWARE                                       22-3270045
     (State or other jurisdiction                            (IRS Employer
   of incorporation or organization)                    Identification Number)

                         3512 VETERANS MEMORIAL HIGHWAY
                             BOHEMIA, NEW YORK 11716

                    (Address of principal executive offices)

                                 (631) 981-5500
                           (Issuer's telephone number)

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 (or for such shorter
period that the registrant was required to file such reports),  and (2) has been
subject to such filing requirements for the past 90 days. Yes [ X ] No [ ]

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:  2,523,867 shares of Common Stock, as
of October 31, 2001.

Transitional Small Business Disclosure Format (check one): Yes [   ]   No [ X ]

<PAGE>


                                  VIZACOM INC.

                                TABLE OF CONTENTS


PART I.  FINANCIAL INFORMATION

Item                                                                      Pages
----                                                                      -----

ITEM 1.  FINANCIAL STATEMENTS:

Condensed Consolidated Balance Sheets as of September 30, 2001 (Unaudited)
      and December 31, 2000                                                   3

Condensed Consolidated Statements of Operations for the Three and Nine
     Months Ended September 30, 2001 and 2000 (Unaudited)                     4

Condensed Consolidated Statement of Changes in Stockholders' Equity
     for the Nine Months Ended September 30, 2001 (Unaudited)                 5

Condensed Consolidated Statements of Cash Flows for the Nine Months Ended
     September 30, 2001 and 2000 (Unaudited)                                  6

Notes to Condensed Consolidated Financial Statements                       7-21

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS                                            22-30

PART II - OTHER INFORMATION                                               31-34


                                       2
<PAGE>
                                  VIZACOM INC.
                      CONDENSED CONSOLIDATED BALANCE SHEETS


<TABLE>
<CAPTION>
                                                                               September 30,  December 31,
                                                                                  2001            2000
                                                                              --------------  --------------
ASSETS                                                                         (Unaudited)
<S>                                                                               <C>             <C>
Current assets:
   Cash and cash equivalents                                                      $ 191,056       $ 843,836
   Marketable securities                                                                  -             797
   Receivables
      Trade,  less allowances of  $319,106 and  $608,975                          1,198,356       3,341,960
      Other                                                                          62,207         155,025
      Notes, current portion                                                        418,549          60,336
    Inventories                                                                     304,609         864,031
    Restricted cash                                                                 150,000               -
    Prepaid expenses and other current assets                                       143,719         329,152
                                                                              --------------  --------------
           Total current assets                                                   2,468,496       5,595,137
Property and equipment, net                                                         221,931         818,132
Goodwill, net of accumulated amortization of $1,032,632 and $780,012              1,767,420       1,670,040
Business processes and methodologies, workforce, and customer lists, net of
 accumulated amortization of $1,491,903 and $779,746                              3,046,097       3,758,254
Deferred consulting costs                                                           921,826       1,371,823
Note receivable, long term                                                          384,734               -
Other assets                                                                         63,609         868,811
                                                                              --------------  --------------
           Total assets                                                          $8,874,113    $ 14,082,197
                                                                              ==============  ==============

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
   Bank note payable                                                             $1,214,172     $ 1,214,172
   Related party notes and other related party liabilities                        1,036,525         563,867
   Bridge loan payable, face amount $250,000, net of unamortized debt
      discount of $250,000 at September 30, 2001                                          -               -
   Current portion of long-term debt and capital lease obligations                  239,528         465,105
   Accounts payable                                                               1,845,890       5,027,736
   Accrued liabilities                                                            1,499,434       2,622,875
   Sales and value-added taxes payable                                                3,837         386,089
                                                                              --------------  --------------
           Total current liabilities                                              5,839,386      10,279,844
Related party notes, long term                                                      126,685               -
Long-term debt and capital lease obligations, less current maturities                 4,623          48,717
                                                                              --------------  --------------
           Total liabilities                                                      5,970,694      10,328,561
                                                                              --------------  --------------
Commitments and contingencies
Stockholders' equity:
   Common stock, par value $.001 per share,
       60,000,000 shares authorized, 2,404,177 and 1,619,087 shares issued            2,404           1,619
   Additional paid-in capital                                                    72,635,550      70,851,835
   Accumulated deficit                                                          (69,548,375)    (66,954,898)
   Accumulated other comprehensive loss                                             (95,765)       (134,525)
   Unamortized debt discount in excess of bridge loan                               (80,000)              -
   Treasury stock, 310 shares, at cost                                              (10,395)        (10,395)
                                                                              --------------  --------------
              Total stockholders' equity                                          2,903,419       3,753,636
                                                                              --------------  --------------
              Total liabilities and stockholders' equity                         $8,874,113    $ 14,082,197
                                                                              ==============  ==============

</TABLE>

See accompanying notes to condensed consolidated financial statements.



                                       3
<PAGE>

                                  VIZACOM INC.
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                             Three Months Ended Sept. 30,     Nine Months Ended Sept. 30,
                                                            ------------------------------   ----------------------------
                                                                2001            2000             2001           2000
                                                            -------------    -------------   -------------  -------------
Net sales
<S>                                                         <C>               <C>              <C>           <C>
  Hardware                                                  $  1,477,153      $ 3,763,536      $9,065,999    $ 8,374,820
                                                            -------------    -------------   -------------  -------------
  Website design and other services                              435,621          565,774       1,583,810      1,580,304
                                                               1,912,774        4,329,310      10,649,809      9,955,124
Cost of sales
  Hardware                                                     1,222,285        3,461,213       8,003,769      7,201,292
  Website design and other services                              268,039          437,665       1,009,674        953,014
                                                            -------------    -------------   -------------  -------------
                                                               1,490,324        3,898,878       9,013,443      8,154,306
                                                            -------------    -------------   -------------  -------------

Gross profit                                                     422,450          430,432       1,636,366      1,800,818

Selling, general and administrative expenses                   1,074,696        1,659,519       3,607,678      4,128,335
Restructuring expenses                                                 -                -         187,584              -
Depreciation and amortization                                    321,656           66,552         843,310        611,080
Amortization of goodwill, business processes and
  methodologies, workforce, and customer lists                   321,593          484,993         964,777      1,043,697
Realized loss (gain) on marketable securities                          -                -          85,226     (1,095,348)
Interest and other expense, net of other income                   47,438           77,215         153,989        216,682
                                                            -------------    -------------   -------------  -------------
                                                               1,765,383        2,288,279       5,842,564      4,904,446

       Loss from continuing operations                        (1,342,933)      (1,857,847)     (4,206,198)    (3,103,628)

Discontinued operations:
       Income (loss) from operations of
          discontinued businesses                                      -         (718,244)        139,384     (3,611,009)
       Gain on sale of discontinued operations                         -                -       1,473,337              -
                                                            -------------    -------------   -------------  -------------
       Income (loss) from discontinued operations                      -         (718,244)      1,612,721     (3,611,009)

       Net loss                                             $ (1,342,933)    $ (2,576,091)   $ (2,593,477)  $ (6,714,637)
                                                            =============    =============   =============  =============

Net income (loss) per common share:
        Continuing operations                                    $ (0.64)         $ (1.52)        $ (2.17)       $ (2.90)
        Discontinued operations                                      $ -          $ (0.59)         $ 0.83        $ (3.37)
                                                            -------------    -------------   -------------  -------------

        Net loss per common share -  basic and diluted           $ (0.64)         $ (2.11)        $ (1.34)       $ (6.27)
                                                            =============    =============   =============  =============
        Weighted average number of common shares
          outstanding - basic and diluted                      2,093,307        1,218,273       1,940,993      1,070,935
                                                            =============    =============   =============  =============

</TABLE>
See accompanying notes to condensed consolidated financial statements.



                                       4
<PAGE>

                                  VIZACOM INC.
       CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
                                   (Unaudited)


<TABLE>
<CAPTION>

                                                                                                 Additional
                                                                                                   Paid-In      Accumulated
                                                                       Shares        Amount        Capital        Deficit
                                                                     ------------ ------------- -------------- ---------------
<S>                                                                  <C>             <C>       <C>            <C>
Balance at December 31, 2000                                           1,619,087       $ 1,619   $ 70,851,835   $ (66,954,898)

Net  loss                                                                      -             -              -      (2,593,477)
Realized loss on marketable securities                                         -             -              -               -
Currency translation adjustment                                                -             -              -               -
                                                                                                               ---------------
TOTAL COMPREHENSIVE INCOME (LOSS)                                                                                  (2,593,477)
                                                                                                               ---------------
Sale of common stock in private placements, net                          149,000           149        269,166               -
Common stock issued to satisfy outstanding liabilties                     27,800            28        151,190               -
Common stock issued in connection with settlement agreements             160,000           160        408,270               -
Common stock  and warrants issued  in connection
   with consulting services                                              157,000           157        391,984               -
Common stock issued in connection with the PWR merger agreement           91,290            91            (91)              -
Common stock issued in connection with bridge loan                       200,000           200        329,800               -
Restructuring of related party debt                                            -             -        233,396               -

                                                                     ------------ ------------- -------------- ---------------
Balance at September 30, 2001                                          2,404,177       $ 2,404   $ 72,635,550   $ (69,548,375)
                                                                     ============ ============= ============== ===============


                                                                       Accumulated     Unamortized
                                                                          Other       Debt Discount                   Total
                                                                      Comprehensive   in Excess of    Treasury    Stockholders'
                                                                      Income (Loss)    Bridge Loan      Stock         Equity
                                                                      --------------- -------------- ------------ ---------------
Balance at December 31, 2000                                              $ (134,525)                  $ (10,395)    $ 3,753,636

Net  loss                                                                          -              -            -               -
Realized loss on marketable securities                                        85,226              -            -               -
Currency translation adjustment                                              (46,466)             -            -               -
                                                                      ---------------
TOTAL COMPREHENSIVE INCOME (LOSS)                                             38,760              -            -      (2,554,717)
                                                                      ---------------
Sale of common stock in private placements, net                                    -              -            -         269,315
Common stock issued to satisfy outstanding liabilties                              -              -            -         151,218
Common stock issued in connection with settlement agreements                       -              -            -         408,430
Common stock  and warrants issued  in connection
   with consulting services                                                        -              -            -         392,141
Common stock issued in connection with the PWR merger agreement                    -              -            -               -
Common stock issued in connection with bridge loan                                 -        (80,000)           -         250,000
Restructuring of related party debt                                                -              -            -         233,396

                                                                      --------------- -------------- ------------ ---------------
Balance at September 30, 2001                                              $ (95,765)     $ (80,000)   $ (10,395)    $ 2,903,419
                                                                      =============== ============== ============ ===============
</TABLE>

See accompanying notes to condensed consolidated financial statements.


                                       5
<PAGE>

                                  VIZACOM INC.
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                            Nine Months Ended Sept. 30,
                                                                                            ---------------------------
                                                                                               2001           2000
                                                                                            ------------   ------------
OPERATING ACTIVITIES:
<S>                                                                                         <C>            <C>
Loss from continuing operations                                                             $ (4,206,198)  $ (3,103,628)
Adjustments to reconcile loss from continuing operations
    to net cash used in operating activities:
   Depreciation and amortization                                                               1,831,940      1,676,055
   Realized loss (gain) on marketable securities                                                  85,226     (1,095,348)
   Realized loss on sale of property and equipment                                                   891              -
   Warrants, common stock, and stock options issued for consulting services                      239,811        321,504
    Provision for bad debts                                                                      279,688         62,329
   Changes in assets and liabilities, net of effects of acquisitions
 and dispositions:
      Receivables                                                                              1,655,639       (522,636)
      Inventories                                                                                 81,061       (192,820)
      Prepaid expenses and other current assets                                                  (83,457)        41,325
      Accounts payable                                                                          (293,116)       883,887
      Accrued liabilities                                                                       (259,539)       174,034
      Sales and value-added taxes payable                                                        (32,420)       (20,192)
                                                                                            ------------   ------------
             Net cash used in continuing operations                                             (700,474)    (1,775,490)
             Net cash provided by (used in) discontinued operations                              287,221     (4,698,582)
                                                                                            ------------   ------------
             Net cash used in operating activities                                              (413,253)    (6,474,072)
                                                                                            ------------   ------------
INVESTING ACTIVITIES:
Purchase of property and equipment                                                                (2,217)      (114,310)
Net proceeds from sale of property and equipment                                                   1,350              -
Proceeds from note receivable                                                                    184,217              -
Increase in other assets                                                                         (21,989)       (10,673)
Decrease in restricted cash                                                                       89,838              -
Disposition of business, net of cash disposed                                                   (387,767)             -
Acquisitions of businesses, net of cash acquired                                                       -     (1,318,831)
                                                                                            ------------   ------------
             Net cash used in continuing operations                                             (136,568)    (1,443,814)
             Net cash used in discontinued operations                                           (209,646)      (108,721)
                                                                                            ------------   ------------
             Net cash used in investing activities                                              (346,214)    (1,552,535)
                                                                                            ------------   ------------
FINANCING ACTIVITIES:
Proceeds from sale of common stock - net                                                         269,315      7,626,580
Proceeds from bank notes payable and inventory financing facility, net                                 -       (709,465)
Proceeds from exercise of warrants and options                                                         -        839,159
Payment of related party notes payable                                                          (266,614)      (432,313)
Proceeds from bridge loan                                                                        250,000              -
Payment of long-term debt and capital lease obligations                                         (151,357)       (92,395)
                                                                                            ------------   ------------
             Net cash provided by continuing operations                                          101,344      7,231,566
             Net cash used in discontinued operations                                            (43,998)      (202,710)
                                                                                            ------------   ------------
             Net cash provided by financing activities                                            57,346      7,028,856
                                                                                            ------------   ------------

Effect of exchange rate changes on cash and cash equivalents                                      49,341       (235,425)
                                                                                            ------------   ------------

Decrease in cash and cash equivalents                                                           (652,780)    (1,233,176)
Cash and cash equivalents at beginning of period                                                 843,836      1,730,495
                                                                                            ------------   ------------
Cash and cash equivalents at end of period                                                  $    191,056   $    497,319
                                                                                            ============   ============

Supplemental disclosure of cash flow information:
  Interest paid
      Continuing operations                                                                 $    119,689   $    101,093
                                                                                            ============   ============
      Discontinued operations                                                               $      5,730   $     57,102
                                                                                            ============   ============
</TABLE>


                                       6

See accompanying notes to condensed consolidated financial statements.

<PAGE>


                                  VIZACOM INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

1.      BASIS OF PRESENTATION

        The accompanying  unaudited condensed  consolidated financial statements
        of Vizacom Inc. (the "Company") and its wholly owned  subsidiaries  have
        been  prepared  in  accordance  with  accounting   principles  generally
        accepted  in  the  United  States  of  America  for  interim   financial
        information  and with the  instructions  to Form  10-QSB and Item 310 of
        Regulation S-B. Accordingly,  they do not include all of the information
        and footnotes required by generally accepted  accounting  principles for
        complete  financial  statements.  In  the  opinion  of  management,  all
        adjustments   (consisting  of  normal  recurring  accruals)   considered
        necessary for a fair presentation have been included.  All share amounts
        and prices have been  adjusted to reflect a one-for-ten  (1:10)  reverse
        stock split that became effective on May 23, 2001. Operating results for
        the  nine-month  period  ended  September  30, 2001 are not  necessarily
        indicative  of the  results  that may be  expected  for the year  ending
        December 31, 2001. For further  information,  refer to the  consolidated
        financial  statements  and footnotes  thereto  included in the Company's
        Annual Report on Form 10-KSB for the year ended  December 31, 2000.  The
        condensed  consolidated  balance  sheet as of December 31, 2000 has been
        derived from the Company's audited consolidated balance sheet as of that
        date.

2.      RECENT ACCOUNTING PRONOUNCEMENTS

        In July 2001, the Financial  Accounting  Standards Board ("FASB") issued
        Statement of Financial  Accounting Standards ("SFAS") No. 141, "Business
        Combinations" and SFAS No. 142,  "Goodwill and Intangible  Assets." SFAS
        141 requires  that all  business  combinations  be accounted  for by the
        purchase  method of accounting and changes the criteria for  recognition
        of intangible assets acquired in a business combination.  The provisions
        of SFAS 141 apply to all business combinations  initiated after June 30,
        2001.  The Company  does not expect  that the  adoption of SFAS 141 will
        have a material effect on its consolidated financial position or results
        of  operations.  SFAS 142 requires that goodwill and  intangible  assets
        with  indefinite  useful  lives no longer be  amortized  but  tested for
        impairment at least annually, while intangible assets with finite useful
        lives continue to be amortized over their  respective  useful lives. The
        statement also  establishes  specific  guidance for testing goodwill and
        intangible  assets with  indefinite  useful  lives for  impairment.  The
        provisions of SFAS 142 will be effective for 2002. However, goodwill and
        intangible   assets  acquired  after  June  30,  2001  will  be  subject
        immediately  to the  provisions of SFAS 142. The Company is currently in
        the process of evaluating the potential  impact the adoption of SFAS 142
        will  have  on  its  consolidated   financial  position  or  results  of
        operations.

3.      LIQUIDITY AND BUSINESS RISKS

        With the  exception  of the  first  quarter  of 2001,  the  Company  has
        experienced recurring net losses since its inception,  and had a working
        capital  deficiency of $3,370,890 at September 30, 2001. The improvement
        of  $1,313,817,  from its working  capital  deficiency  of $4,684,707 at
        December 31, 2000, is attributable  to the Company's  disposition of its
        visual communications and international  operations in the first quarter
        of 2001, described in Note 6.

        In January  2001,  the Company sold  149,000  shares of common stock for
        aggregate gross proceeds of $372,500. On March 31, 2001 the Company sold
        its Serif visual communications software subsidiaries. The note received
        from  Serif  Inc.,  one of the  Company's  former  visual  communication
        subsidiaries,   provides   for   payments  to  the  Company  of  monthly
        installments  aggregating  $360,000  in 2001 and  $480,000  in 2002.  In
        September  2001,  the  Company  signed a letter of intent to  purchase a
        privately  held  company as  described in Note 5. As a condition to this
        transaction,  the Company agreed to restructure or satisfy $1,000,000 of
        current  liabilities.  This  privately  held  company  agreed to lend an
        aggregate  of  $650,000  to the  Company in  advance of the  prospective
        transaction.  The Company  received  $250,000 in  September  2001 and an
        additional  $200,000 of these loans in October 2001.  The final $200,000
        is expected in November 2001.


                                       7
<PAGE>

                                  VIZACOM INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

3.      LIQUIDITY AND BUSINESS RISKS (CONTINUED)

        On July 18, 2001,  the Company's PWR subsidiary was notified that it was
        in default of its  obligations  by a provider of a  temporary  inventory
        finance  facility in the approximate  amount of $200,000.  This loan was
        subsequently  repaid in full. On October 10, 2001, the inventory finance
        company advised PWR that no further financing would be provided until it
        receives an irrevocable letter of credit of not less than $50,000 in its
        favor from an acceptable financial institution.  If the foregoing is not
        received by January 11, 2002, the credit facility will be terminated.

        As of  September  30, 2001  approximately  $1,200,000  of the  Company's
        outstanding  debt  obligations was owed to a bank on a short-term  basis
        with no long-term  lending  commitment.  The loan expired on October 29,
        2001. Upon expiration the underlying  collateral for the debt obligation
        was insufficient to support the level of borrowing. The Company believes
        that it has reached a preliminary  oral  agreement in principal with the
        bank on a new six-month  note,  bearing  interest at prime plus one-half
        percent,  with payments as follows:  (a) no principal  payments  through
        February 28, 2002,  except that the Company will pay $125,000 out of the
        proceeds of its anticipated private placement, (b) approximately $40,000
        per  month  starting  on or about  March 1,  2002 and (c) an  additional
        $25,000  out of each $1  million in  additional  net  proceeds  above $1
        million that the Company raises in its anticipated private placement. In
        connection  with this six-month  note, the Company will provide the bank
        with a first  priority  lien on its  promissory  note  from  Serif  Inc.
        Additionally,  the Company's SPC subsidiary  will guaranty this note and
        grant a first priority lien on its U.S. Harvard trademark rights.  There
        can be no  assurance  that  the  Company  will be able to  finalize  any
        agreement  with the  bank,  or that any  agreement  will be on the terms
        described above.

        The Company  believes that over the next several  months it will need to
        raise  at  least  an   additional   $2,000,000  to  meet  its  currently
        anticipated liquidity and capital expenditure  requirements.  Management
        intends to seek additional  financing through one or more debt,  equity,
        or  convertible  securities  offerings,  through  the sale of  assets or
        through a merger or  acquisition.  There  can be no  assurance  that the
        Company will be successful in completing any such offering or offerings,
        sale of  assets  or merger or  acquisition,  or any other  offerings  or
        transactions,  or that  the  terms of any such  offering  or  offerings,
        transaction  or  transactions  will be  beneficial to the Company or its
        stockholders.  The financial  statements do not include any  adjustments
        that might result from the outcome of this uncertainty.

4.      LOSS PER SHARE

        Basic loss per share is computed based upon the weighted  average number
        of common shares outstanding during each period presented. Stock options
        and  warrants  did not have an  effect  on the  computation  of  diluted
        earnings per share in the three and nine-month  periods ended  September
        30, 2001 and 2000 since they were anti-dilutive.

5.      ACQUISITION AND BRIDGE LOAN TRANSACTIONS AND RELATED AGREEMENTS

        In September 2001, the Company  executed a letter of intent to acquire a
        privately-held   New  York  City   based   company,   SpaceLogix,   Inc.
        ("SpaceLogix").   SpaceLogix  is  a  facilities-based  managed  services
        provider  that  resells  co-location  and  network  management  services
        through  its  relationships  with  landlords,  major  telecommunications
        companies,  utilities,  and other third-party data center owners.  Under
        the terms of the  letter  of  intent,  SpaceLogix  is  extending  to the
        Company a series of secured bridge loans for a total of $650,000, and in
        connection therewith will receive 400,000 shares of the Company's common
        stock.  The  bridge  loan  bears  interest  at 9% and is  secured by the
        Company's  interest in its promissory note from Serif Inc. This security
        interest is  expected to be  subordinated  to the  anticipated  security
        interest  of the bank in this note.  See Notes 3 and 6. The  Company has
        agreed to utilize  approximately  $450,000 of the total bridge loans for
        working capital of its PWR Systems  subsidiary,  though no assurance can
        be given that this will be achieved.  On September 18, 2001, the



                                       8
<PAGE>

                                  VIZACOM INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

        Company received the first $250,000 installment of the bridge loan, and
        issued 200,000 shares of its common stock to SpaceLogix. On October 10,
        2001, the VIZACOM INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL
        STATEMENTS (Unaudited)

5.      ACQUISITION  AND  BRIDGE  LOAN   TRANSACTIONS  AND  RELATED   AGREEMENTS
        (CONTINUED)

        Company received the second $200,000 installment of the bridge loan, and
        issued  100,000  shares of its  common  stock to  SpaceLogix.  The final
        $200,000  installment  of the bridge  loan is expected to be received in
        November 2001.  SpaceLogix may satisfy part of the final  installment of
        the bridge loan  through the  arrangement  of a letter of credit for the
        benefit of the  Company.  The  bridge  loan is  payable  upon  demand in
        monthly payments of $40,000 upon termination of merger negotiations.  If
        the  merger  does not occur,  other  than as a result of any  actions or
        inactions by or on behalf of the Company,  upon retirement of the bridge
        loan,  all  400,000  shares  of the  Company's  common  stock  issued to
        SpaceLogix  will be returned to the  Company  for  cancellation.  If the
        merger does not occur as a result of any actions or  inactions  by or on
        behalf of the  Company,  including  the  failure  to obtain  stockholder
        approval,  upon  retirement  of the bridge loan,  200,000 of such shares
        will be returned by SpaceLogix.  Upon the closing of the  acquisition of
        SpaceLogix,  the Company expects to issue 1,950,000 shares of its common
        stock,  and  the  former  stockholders  of  SpaceLogix  will  own in the
        aggregate  approximately 49% of the issued and outstanding  common stock
        of the Company.  The Company also expects to issue  warrants to purchase
        600,000 shares of the Company's common stock, at an exercise price equal
        to  110% of the  market  price,  so  that  the  former  stockholders  of
        SpaceLogix will own approximately 45% of the common stock of the Company
        on a fully diluted basis.  Certain SpaceLogix  stockholders are to place
        an  aggregate  of 750,000 of the shares  they  receive in escrow,  to be
        released upon completion of a private placement to accredited  investors
        that raises no less than  aggregate net proceeds of  $1,000,000  for the
        Company  within  120  days  of the  closing  of  the  merger.  Upon  the
        completion of the acquisition, SpaceLogix will have the right to appoint
        one  director  to the  Company's  Board of  Directors.  The  Company and
        SpaceLogix  have  agreed  to  mutual  no shop  provisions  with a fee of
        $50,000 if violated by either party.

        The placement  agent for the private  placement  will receive an 8% cash
        commission, a 2% non accountable expense allowance, and warrants for 10%
        of the shares sold in the private  placement  exercisable at 150% of the
        offering price of the stock in the private placement.  In addition, upon
        the completion of the private placement,  the Company will enter into an
        investment  banking  agreement with the placement  agent. The investment
        banking  agreement  will  provide  as  compensation  for such  services,
        warrants  to purchase  400,000  shares of common  stock of the  Company,
        200,000 of which shall be exercisable at 120% and 200,000 of which shall
        be exercisable at 150% of the market price of the Company's common stock
        as  of  the  date  of  such  investment   banking   agreement.   Certain
        stockholders  of  SpaceLogix  are  affiliated  or  associated  with  the
        placement agent.

        As a condition to the execution of the SpaceLogix merger agreement,  the
        Company was required to restructure or satisfy approximately  $1,000,000
        of  current   liabilities   as  of  June  30,  2001  to  the  reasonable
        satisfaction of SpaceLogix.  Through a series of transactions  completed
        as of September 30, 2001, the Company has achieved this  objective.  The
        Company entered into an agreement with its corporate  counsel,  of which
        its  Chairman  of the  Board is a  member,  to  reduce  and  restructure
        outstanding liabilities totaling $739,655 as of September 30, 2001. This
        agreement  reduces the amount owed to this firm by $300,000 and provides
        for the  issuance  by the  Company to such firm of a secured  promissory
        note in the principal  amount of $439,655,  bearing interest at 6.6% per
        annum.  The  promissory  note  provides for monthly  payments of $25,000
        beginning  the  earlier  of the first  month  after the  closing  of the
        SpaceLogix  acquisition or January 1, 2002,  with a $150,000  prepayment
        upon  the  completion  of  the  private  placement  contemplated  by the
        SpaceLogix letter of intent. The note is collateralized by the Company's
        interest in the promissory  note from Serif Inc. This security  interest
        is subordinated to the security interest of SpaceLogix in this note, and
        is expected to be subordinated to the anticipated  security  interest of
        the bank in this note. The Company has reduced the recorded liability to
        its corporate  counsel from the previous  total of $739,655 in September
        30, 2001 to $506,259,  representing the total of the principal amount of
        the  note,  interest  thereon  over the term of the  note,  and  certain
        contingent payment amounts.  The resulting  reduction in indebtedness in
        the amount of $233,396 has been recorded as a contribution to capital.


                                       9
<PAGE>

                                  VIZACOM INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

5.      ACQUISITION  AND  BRIDGE  LOAN   TRANSACTIONS  AND  RELATED   AGREEMENTS
        (CONTINUED)

        The Company  entered into  amendments  to the PWR merger  agreement  and
        employment  agreements  with its  President  and its Vice  President and
        Chief  Technology  Officer,  each  of whom  is  also a  director  of the
        Company,  pursuant  to which their  annual  salaries  are  reduced  from
        $200,000  to  $125,000  each  effective  on October  1, 2001.  These two
        officers  will also  receive  payments of 17.5% each,  of net income (as
        defined) of the  Company's PWR  subsidiary  in excess of  pre-determined
        quarterly  targets,  through  the first  quarter of 2003.  Net income is
        defined  as  the  income  of PWR  before  amortization  of  intangibles,
        interest on the notes payable to these officers,  the bonuses payable to
        these officers,  and corporate  overhead (as defined).  These amendments
        will  automatically  terminate if: (i) the merger with SpaceLogix is not
        consummated  by April 1, 2002;  (ii) PWR does not receive  $1,000,000 of
        working  capital from either the bridge loan, the  contemplated  private
        placement, or other transactions by April 1, 2002, or (iii) PWR does not
        retain the  $1,000,000  of working  capital due to payments  made to the
        Company  or its  other  subsidiaries  other  than  normal  inter-company
        management fee payments. In addition,  the remaining $306,951 balance of
        the notes payable by the Company's PWR  subsidiary to these officers was
        restructured with aggregate  payments of $25,000 per month commencing on
        January 1, 2002. These notes are  collateralized  by the Company's Serif
        Inc.  promissory  note,  which security  interest is subordinated to the
        security interest therein held by SpaceLogix and the Company's corporate
        counsel  in  such  note,  and  is  expected  to be  subordinated  to the
        anticipated security interest of the bank in this note.

        On September 28, 2001,  the Company  settled,  for 130,000 shares of the
        Company's common stock, a pending arbitration  relating to an investment
        banking  agreement which it had  terminated.  $232,000 had been reserved
        for this  contingent  liability.  Also as of  September  28,  2001,  the
        Company  entered into an agreement to issue 10,000  shares of its common
        stock to settle  $14,119 of  outstanding  current  liabilities  to a law
        firm.

6.      PLAN OF RESTRUCTURING; DISCONTINUED OPERATIONS

        In early 2001, the Company  determined to restructure its operations and
        management team. The Company relocated its principal  executive offices.
        Certain  members of  management  and other  employees  resigned  or were
        terminated.  In addition,  the Company determined to divest its software
        and overseas operations so as to better focus on developing its internet
        and technology solutions business in the United States.  Accordingly, on
        January 9, 2001,  the Company  entered into an  agreement  with a German
        company for the sale of certain  assets and assumption of liabilities of
        the Company's Aachen,  Germany contact center operation.  On February 2,
        2001,  Junction 15 Limited and  interMETHODS  Limited,  two companies in
        England,  which the Company acquired in 2000, were placed into creditors
        voluntary liquidation in the United Kingdom. These software and overseas
        operations are reflected in discontinued operations.

        The  Company  entered  into an  agreement  dated as of March 27, 2001 to
        terminate its sublease for space in Teaneck,  New Jersey.  In accordance
        with the agreement,  the premises were vacated on March 31, 2001 with no
        further lease obligations for the premises.

        On  March  31,  2001,   the  Company  sold  its  wholly  owned,   United
        Kingdom-based  subsidiary,  Serif (Europe)  Limited ("Serif Europe") and
        its  subsidiaries  to an English  company,  GW 313 Limited (the "Buyer")
        owned by the management  team of Serif Europe and Serif Europe's  wholly
        owned subsidiary, Serif Inc. The operations of Serif Europe, Serif Inc.,
        and Serif  Europe's  other  wholly  owned  subsidiaries,  Serif GmbH and
        Dialog 24  Limited,  together  with the  Company's  Software  Publishing
        Corporation ("SPC")  subsidiary,  comprised in all material respects its
        visual communications  operations. The Company received $150,000 in cash
        upon  closing,  the use of which has been  restricted.  See Note 15. The
        Company also received a promissory note from Serif Inc. in the aggregate
        principal amount of $987,500,  which bears interest at a rate of 10% per
        annum, and which is payable $40,000 per month, except for each April and
        November,  in  which  months  the  payments  are  $30,000  and  $50,000,
        respectively.  The Buyer has  guaranteed  this  promissory  note and has
        pledged the shares of Serif Europe as collateral therefor. The


                                       10
<PAGE>

                                  VIZACOM INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

6.      PLAN OF RESTRUCTURING; DISCONTINUED OPERATIONS (CONTINUED)

        Company or one of its subsidiaries remain responsible for some potential
        liabilities  which have been  recorded on the  Company's  books,  as set
        forth in the  bill of sale  and  assignment  and  assumption  agreement,
        executed at the time of the Share Acquisition Agreement.

        As part of the transaction,  Serif Europe received a 12-month  exclusive
        license in Europe and a  24-month  non-exclusive  license in the rest of
        the world with respect to the software of the Company's SPC  subsidiary.
        Serif  Europe  was also  granted a  non-exclusive  license  to use SPC's
        Harvard  Graphics(R)  brand name for the  purpose of selling  repackaged
        Serif products using such name.  These licenses were granted pursuant to
        the software license agreement,  dated as of March 31, 2001, between SPC
        and Serif Europe. Each of such licenses are renewable if minimum royalty
        and other conditions are met. In consideration therefor, Serif Europe is
        obligated  to pay a  royalty  fee of  12.5% in  respect  of sales of SPC
        software and 3% of sales of repackaged Serif software.  The Company also
        agreed that while it  continues  to own SPC,  it will not  compete  with
        Serif in the software business as long as the licenses are in effect.

        The Company has  recently  resolved  allegations  of Harvard  University
        ("Harvard")  that SPC was in  violation  of the terms of a 1989  Consent
        Agreement  entered  into  between the two  entities  with respect to the
        Harvard trademarks.  Harvard has preliminarily  indicated that it may be
        interested in acquiring SPC's Harvard trademarks. On September 30, 2001,
        the Company agreed to pay its corporate  counsel,  of which its Chairman
        is a member,  20% of any proceeds it receives  from Harvard with respect
        to the sale,  license,  or other acquisition by Harvard of SPC's Harvard
        trademarks, copyrights, or other rights.

7.      DEBT

        On September  18, 2001, in connection  with the  SpaceLogix  transaction
        (see Note 5), the Company  received the first  installment of the bridge
        loan in the amount of $250,000. The bridge loan bears interest at 9%. In
        conjunction  therewith,  the  Company  issued  200,000  shares of common
        stock,  valued at $330,000,  which was recorded by the Company as a debt
        discount. The excess of the debt discount above the amount of the bridge
        loan, or $80,000, is recorded as deduction from stockholders' equity. If
        the merger negotiations with SpaceLogix are terminated,  the bridge loan
        becomes  payable  at the rate of $40,000  per month  until paid in full.
        Until the completion of the merger, the debt discount is being amortized
        to interest  expense over the expected  life of the bridge loan assuming
        that it would be required to be repaid. On October 10, 2001, the Company
        received the second  installment  of the note,  or $200,000,  and issued
        100,000  shares of common  stock,  valued at $180,000  and recorded as a
        debt discount on the note.

        On July 21, 2000,  PWR terminated  its  relationship  with its inventory
        financing  lender and repaid the  outstanding  inventory loan balance of
        approximately  $925,000 with  existing  working  capital.  On August 25,
        2000, PWR entered into a temporary $500,000 inventory financing security
        agreement with a finance company. In May 2001, this facility was reduced
        to $300,000. On July 18, 2001, the inventory finance lender notified PWR
        that it was in default of its  obligations  under  this  facility.  This
        facility  was  subsequently  repaid in full by PWR. On October 10, 2001,
        the  inventory  lender  notified PWR that no further  financing  will be
        available until it receives an irrevocable  letter of credit of not less
        than $50,000 in its favor from an acceptable financial  institution.  If
        the foregoing is not received by January 11, 2002,  the credit  facility
        will be terminated.



                                       11
<PAGE>

                                  VIZACOM INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

7.      DEBT (CONTINUED)

        The bank note  payable  consisted of a  ninety-day  renewable  term note
        secured by the assets of PWR and guaranteed by the Company.  An event of
        default  occurred  under this bank loan  agreement  as a result of PWR's
        default to its  inventory  finance  lender.  Subsequent to this event of
        default,  the bank renewed the loan. On July 30, 2001, PWR issued to the
        bank a ninety-day  promissory note for $1,214,172  which expired October
        29, 2001.  The note bore interest at prime plus one-half  percent (6.50%
        at  September  30,  2001).   The  Company  believes  it  has  reached  a
        preliminary  oral agreement in principal to extend this note payable for
        six-months upon the terms described in Note 3.

        In  December  2000,  one of PWR's  major  suppliers  was granted a third
        priority lien on its assets.

        The related  party  notes  consist of notes in the  aggregate  principal
        amount of  $306,951,  with  interest  at 6.3% per annum,  payable by the
        Company's PWR subsidiary in monthly installments commencing January 2002
        to the two PWR selling stockholders and a collateralized promissory note
        in the  principal  amount of $439,655,  with interest at 6.6% per annum,
        payable to the Company's  corporate counsel.  The promissory note to the
        Company's  corporate  counsel  provides for monthly  payments of $25,000
        beginning  the  earlier  of the first  month  after the  closing  of the
        SpaceLogix  acquisition or January 1, 2002,  with a $150,000  prepayment
        upon  the  completion  of  the  private  placement  contemplated  by the
        SpaceLogix  letter of intent.  The  Company  has  reduced  the  recorded
        liability to its corporate  counsel from the previous  total of $739,655
        in  September  30,  2001 to  $506,259,  representing  the  total  of the
        principal  amount of the  note,  interest  thereon  over the term of the
        note, and certain contingent payment amounts. The resulting reduction in
        indebtedness   in  the  amount  of  $233,396  has  been  recorded  as  a
        contribution to capital. On April 13, 2001, the PWR selling shareholders
        entered into a waiver agreement with the Company and  subordination  and
        assignment  agreements  with the bank,  pursuant to which they  deferred
        payment of amounts due them under the remaining  notes due to them until
        January  2002.  See Note 5. As of September  30, 2001,  the repayment of
        these notes,  which are in the aggregate  principal  amount of $306,951,
        was  restructured  as secured  monthly  payments  of $25,000  commencing
        January 2002.

        On January 8, 2000,  the Company  entered into an  agreement,  which was
        amended as of March 15, 2000, for a maximum $1,000,000 unsecured line of
        credit  note  arrangement  with a foreign  company.  Advances  under the
        arrangement  bear  interest at 8%. The Company  borrowed  $1,000,000  on
        February 17, 2000. This borrowing was paid in full with accrued interest
        on March 20, 2000. In connection with this credit facility,  the Company
        issued seven-year  warrants to purchase an aggregate of 25,000 shares of
        its common stock  exercisable at $30 per share. The warrants were valued
        at $382,500 and are being charged to interest  expense over the two-year
        benefit period.

8.      STOCKHOLDERS' EQUITY

        On January 2, 2001, the Company retained an investment  banking firm for
        the purpose of  providing  financial  advisory  and  investment  banking
        advice for a one-year  term.  Pursuant  to this  agreement,  the Company
        agreed  to issue  45,000  shares  of its  common  stock  and  three-year
        warrants to purchase  60,000  shares of common  stock.  On February  28,
        2001,  this agreement was  terminated,  and the investment  banking firm
        returned all Company securities obtained pursuant to the agreement which
        were still owned by it.

        On January 15, 2001,  the Company  retained a consultant for the purpose
        of  providing  investor   relations,   public  relations  and  corporate
        communications and other services for a one-year term.  Pursuant to this
        agreement,  the  Company  agreed to issue  30,000  shares of its  common
        stock,  valued at  $168,750,  10,000 of which  shares were  subject to a
        lockup  agreement that prohibited their sale prior to July 15, 2001; and
        three- year warrants to purchase  20,000 shares of common stock;  10,000
        immediately exercisable at an exercise


                                       12
<PAGE>

                                  VIZACOM INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

8.      STOCKHOLDERS' EQUITY (CONTINUED)

        price of $2.50 per share,  valued at  $44,648,  and  10,000  exercisable
        commencing  July 15, 2001 at an exercise price of $10 per share,  valued
        at $1,243.

        On January 15,  2001,  the Company  issued  30,000  shares of its common
        stock,  valued at $168,750,  in connection  with the  resignation of its
        chief executive pursuant to a settlement and release agreement.

        On January 22,  2001,  and January 24,  2001,  the Company  entered into
        agreements  with  certain  outside  consultants  to satisfy  outstanding
        liabilities to them. Under their respective agreements, 3,200 and 14,600
        shares were issued,  valued at $24,998 and $109,500,  respectively.  The
        14,600 shares were subject to a six-month lockup  agreement  prohibiting
        their sale until July 2001,  except that an  aggregate  of 7,300  shares
        were allowed to be sold through  July 22,  2001,  provided  that no more
        than 1,000 shares per week could be sold.  The 3,200 shares were subject
        to a lock-up  agreement  restricting  the sale of certain of such shares
        through March 1, 2001.

        On January 26, 2001, the Company accepted  subscriptions  for a total of
        149,000  shares of common stock from 13  accredited  investors for gross
        proceeds of $372,500.  In connection  with this private  placement,  the
        Company  issued  three-year  warrants to purchase 2,300 shares of common
        stock at an exercise price of $2.50 per share as a finders fee.

        On  February  9,  2001,  the  Company  terminated  a December  27,  2000
        agreement  related to  consulting  services for  financial  advisory and
        other related  services,  pursuant to which the Company had issued 6,000
        shares of common stock. Under the terms of the original agreement, 3,000
        shares  held in  escrow,  valued at  $7,500,  were  cancelled  upon such
        termination.

        On May 17, 2001,  the  Company's  stockholders  approved the issuance of
        shares  to  the  Company's   President  and  Vice  President  and  Chief
        Information  Officer,  who were the former selling  shareholders of PWR,
        due under the March 27, 2000 merger  agreement with PWR, as amended.  In
        connection  therewith,  the Company  issued 45,645 shares to each of the
        former PWR selling shareholders.

        On May 23, 2001, the Company effected a one-for-ten (1:10) reverse stock
        split.

        On June 29,  2001,  the  Company  expanded  the scope of  services to be
        provided  by  one  of its  consultants  and  extended  the  term  of the
        agreement with such consultant.  Pursuant to this agreement, the Company
        issued 100,000 shares of its common stock, valued at $110,000.

        On September 14, 2001, the Company agreed to issue an aggregate  209,580
        shares of common  stock,  valued at  $350,000,  subject  to  stockholder
        approval,   to  the  PWR  selling   shareholders  as  additional  merger
        consideration  in accordance  with the  provisions of the March 27, 2000
        merger  agreement with PWR, as amended.  The  corresponding  amounts are
        shown as goodwill and other  related party  liabilities  as of September
        30, 2001.  The liability will be recorded as common stock and additional
        paid  in  capital  if  the   issuance  is  approved  by  the   Company's
        stockholders.

        On September 18, 2001 the Company  issued  200,000  shares of its common
        stock, valued at $330,000, in connection with a bridge loan arrangement.
        See Note 5.

        On September 28, 2001 the Company settled a pending  arbitration with an
        investment banking firm. Pursuant to the settlement,  the Company issued
        130,000 shares of its common stock, valued at $240,500. Additionally, on
        such  date,  the  Company  settled  a $14,119  payable  to a law firm by
        issuing 10,000 shares of its common stock, with a value of $18,500.


                                       13
<PAGE>

                                  VIZACOM INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

8.      STOCKHOLDERS' EQUITY (CONTINUED)

        On October 10, 2001, the Company issued an additional  100,000 shares of
        its common stock,  valued at $180,000,  in connection with a bridge loan
        arrangement. See Note 7.

        On October 15, 2001,  the Company  entered into an engagement  agreement
        with an  investment  banking firm to provide the Company with a fairness
        opinion in connection with the proposed acquisition of SpaceLogix,  Inc.
        As partial payment of fees for services to this firm, the Company issued
        20,000 shares of common stock, valued at $36,000, to this firm.

9.      SEGMENT INFORMATION

        During 2000, the Company completed four  acquisitions.  The two domestic
        acquisitions  formed  the  foundation  for  the  Company's  professional
        internet and technology solutions business, which is referred to as Vizy
        Interactive and consists of Vizy Interactive New York, formerly known as
        Renaissance Multimedia,  and Vizy Interactive-PWR Systems, also known as
        PWR Systems. This constitutes our continuing  operations.  Revenues from
        this business segment consist  primarily of e-business  consulting,  web
        site  design,  network and systems  integration  services  and  computer
        hardware sales.

        In early  2001,  the  Company  determined  to divest  its  software  and
        overseas operations so as to better focus on developing its internet and
        technology  solutions  business in the U.S.  Accordingly,  on January 9,
        2001,  the Company  entered into an agreement  with a German company for
        the  sale  of  certain  assets  and  assumption  of  liabilities  of the
        Company's Aachen, Germany contact center operation. On February 2, 2001,
        Junction 15 Limited and interMETHODS  Limited,  two companies in London,
        England,  which the Company acquired in 2000, were placed into creditors
        voluntary  liquidation  in the United  Kingdom.  On March 31, 2001,  the
        Company sold its visual  communications  and  international  operations.
        These visual  communications and international  operations are reflected
        in discontinued operations.

        The Company's  historical  business prior to 2000 consisted primarily of
        its direct sale of software and digital cameras,  collectively  referred
        to as Visual  Communications  Products,  utilizing the Company's  direct
        mail  marketing  and  telemarketing   operations  at  its  Nashua,   New
        Hampshire,   Nottingham,   England  and  Aachen,   Germany  call  center
        locations.  The Company's  web-enabled call center business was referred
        to as Dialog24.  The results of the Company's  VisualCities.com  website
        business  and Dialog24  business are included in "Visual  Communications
        Products."



                                       14
<PAGE>

                                  VIZACOM INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

9.      SEGMENT INFORMATION (CONTINUED)

        Information  concerning the Company's  nine-month  segment operations is
        set forth below:

<TABLE>
<CAPTION>
                                                             Foreign      Visual
                                                           Operations in  Comm.          Vizy
                                                           Liquidation   Products    Interactive    Corporate   Consolidated
                                                           -------------------------------------------------------------------
NINE-MONTHS ENDED SEPTEMBER 30, 2001:

CONTINUING OPERATIONS
<S>                                                        <C>            <C>         <C>           <C>          <C>
Net sales                                                  $         -    $       -   $ 10,649,809  $        -   $ 10,649,809
Depreciation and amortization                                        -            -      1,014,444     817,496      1,831,940
Investment loss                                                      -            -              -     (85,226)       (85,226)
Loss from continuing operations                                      -            -     (1,742,529) (2,463,669)    (4,206,198)
Total assets                                                         -            -      6,579,953   2,233,756      8,813,709

DISCONTINUED OPERATIONS
Gain on sale of discontinued operations                              -    1,473,337              -           -      1,473,337
Income from operations of discontinued businesses                    -      139,384              -           -        139,384
Income from discontinued operations                                  -    1,612,721              -           -      1,612,721
Total assets                                                         -       60,404              -           -         60,404

NINE-MONTHS ENDED SEPTEMBER 30, 2000:

CONTINUING OPERATIONS
Net sales                                                  $         -    $       -   $  9,955,124  $        -   $  9,955,124
Depreciation and amortization                                        -            -      1,076,398     599,657      1,676,055
Investment gains                                                     -            -              -   1,095,348      1,095,348
Income (loss) from continuing operations                             -            -     (1,422,240) (1,681,388)    (3,103,628)
Total assets                                                         -            -     14,729,505   1,910,855     16,640,360

DISCONTINUED OPERATIONS
Loss from operations of discontinued businesses               (555,183)  (3,055,826)             -           -     (3,611,009)
Total assets                                                 2,743,836    3,631,795              -           -      6,375,631

</TABLE>


10.     RELATED PARTY TRANSACTIONS

        During the first nine-months of 2001, the Company incurred approximately
        $325,000  of legal  fees and  disbursements  to a law firm of which  the
        Company's  Chairman of the Board is a member. On September 30, 2001, the
        Company and this firm entered  into an agreement  pursuant to which this
        firm  agreed to reduce the amount  owed by the Company to it by $300,000
        and the Company issued to this firm a secured promissory note payable in
        the principal  amount of $439,655,  with interest at 6.6% per annum. The
        promissory note provides for monthly  payments of $25,000  beginning the
        earlier  of  the  first  month  after  the  closing  of  the  SpaceLogix
        acquisition  or  January 1, 2002,  with a $150,000  prepayment  upon the
        completion  of the  private  placement  contemplated  by the  SpaceLogix
        letter of intent. The collateral for this note is the Company's interest
        in the  promissory  note payable to the Company by Serif Inc.,  and this
        security  interest is subordinated to the security interest in this note
        held by SpaceLogix and is expected to be subordinated to the anticipated
        security  interest of the bank in this note.  The Company also agreed to
        pay this law firm 20% of the gross  proceeds  received by the Company or
        any  of  its  subsidiaries  in  any  future   transaction  with  Harvard
        University  with  respect  to the  Company's  SPC  subsidiary's  Harvard
        trademarks,   copyrights,   or  other   rights.   See  Notes  5  and  6.
        Additionally,  there was $16,114 outstanding of accounts payable to this
        law firm as of  September  30,  2001.  VIZACOM  INC.  NOTES TO CONDENSED
        CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)



                                       15
<PAGE>
                                  VIZACOM INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)


10.     RELATED PARTY TRANSACTIONS (CONTINUED)

        At September  30, 2001,  the Company had $306,951 of related party notes
        payable  outstanding  to its  President  and Vice  President  and  Chief
        Information   Officer,  the  two  former  selling  shareholders  of  the
        Company's PWR Systems  subsidiary.  These notes represent the balance of
        the  pre-acquisition  accumulated  retained  earnings of PWR due to such
        selling  shareholders  in connection  with the Company's  March 27, 2000
        acquisition  of PWR. The payment terms of these notes were  restructured
        in September 2001. See Note 5. Additionally,  such selling  shareholders
        are owed $350,000, payable in 209,580 shares of common stock, subject to
        shareholder  approval,  in connection  with  provisions  relating to the
        aforementioned  merger  agreement.  In September  2001,  these  officers
        agreed to amend the PWR merger agreement and their employment agreements
        with the Company. See Note 5.

11.     STATEMENTS OF CASH FLOWS

        Supplemental  disclosure of non-cash financing and investing  activities
        for the nine  months  ended  September  30,  2001 and 2000 is set  forth
        below:

<TABLE>
<CAPTION>
                                                                                   2001          2000
                                                                               ------------ --------------
<S>                                                                             <C>           <C>
Continuing operations:
Net assets acquired for common stock, stock options, and notes payable          $        -    $ 7,699,245
                                                                               ============ ==============
Warrants and common stock issued for deferred consulting costs                  $  323,398    $   382,500
                                                                               ============ ==============
Restricted cash recorded as subscription liability                              $        -    $    92,745
                                                                               ============ ==============
Note receivable for business disposition                                        $  987,500    $         -
                                                                               ============ ==============
Fixed asset purchased with capital lease                                        $    4,005    $         -
                                                                               ============ ==============
Liability for contingent purchase price                                         $  350,000    $         -
                                                                               ============ ==============
Payment of liabilities with common stock                                        $  389,117    $         -
                                                                               ============ ==============
Common stock issued in connection with bridge loan                              $  250,000    $         -
                                                                               ============ ==============
Accounts payable settled for related party note and
  capital contribution                                                          $  739,655    $         -
                                                                               ============ ==============
Comprehensive loss on decline in marketable securities                          $        -    $   727,877
                                                                               ============ ==============

Discontinued operations:
Fixed assets acquired with capital lease obligations                                   $ -       $ 28,725
                                                                               ============ ==============
Net assets acquired for common stock                                                   $ -    $ 2,350,000
                                                                               ============ ==============

</TABLE>


                                       16
<PAGE>

                                  VIZACOM INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

12.     SPC DUAL CONSOLIDATED LOSSES CLOSING AGREEMENT

        In  connection  with the purchase of SPC in December  1996,  the Company
        applied for a closing  agreement with the Internal  Revenue Service (the
        "IRS") in  September  1997  pursuant to which the Company  would  become
        jointly and severally  liable for SPC's tax obligations  upon occurrence
        of a "triggering event" requiring  recapture of dual consolidated losses
        ("DCLs")  previously utilized by SPC. Such closing agreement would avoid
        SPC's being required to recognize a tax of  approximately  $8 million on
        approximately  $24.5 million of SPC's  pre-acquisition  DCLs. On May 18,
        2001,  the Company  received  the closing  agreement  from the  Internal
        Revenue  Service.  An event  otherwise  constituting a triggering  event
        applicable to a DCL would not constitute a triggering event if it occurs
        in any taxable year after the fifteenth  taxable year following the year
        in  which  the DCL was  incurred.  In  certain  circumstances,  a future
        acquirer  of the  Company  may also be  required  to agree to a  similar
        closing  agreement  in  order to avoid  the same tax  liability,  to the
        extent  it is able to do so,  assuming  the  fifteen  year  period  with
        respect to the DCL had not expired.  The report of our auditors covering
        the  December  31, 2000  consolidated  financial  statements,  which was
        issued before the Company  received the closing  agreement from the IRS,
        contains a paragraph emphasizing these dual consolidated losses.

13.     NASDAQ LISTING REQUIREMENTS

        On March 1, 2001, the Company  received  correspondence  from The Nasdaq
        Stock  Market Inc.  ("Nasdaq")  stating  that its common  stock would be
        delisted from trading  because the bid price of its common stock did not
        equal or exceed  $1.00 for a minimum  of ten  consecutive  trading  days
        prior  to  March  1,  2001,  as  required  by  Nasdaq  Marketplace  Rule
        4310(c)(4).  The Company  appealed  this  determination  and requested a
        hearing before a Nasdaq Listing  Qualifications Panel (the "Panel").  At
        the hearing,  the Company presented its plan to achieve  compliance with
        all Nasdaq listing  maintenance  requirements,  including a plan to seek
        approval from  stockholders of a reverse stock split to satisfy Nasdaq's
        minimum  bid  price  requirement.   On  May  17,  2001,  at  its  annual
        stockholders' meeting, the Company's stockholders approved a proposal to
        authorize  the Board of Directors to effect a reverse stock split of the
        Company's  common  stock.  On May 23, 2001,  the Company  effectuated  a
        one-for-ten  reverse  stock  split  which  enabled  it to meet  Nasdaq's
        minimum  bid  requirement.  In a letter  dated June 5, 2001,  the Nasdaq
        Listing  Qualifications  Panel determined to allow the Company to remain
        listed on The Nasdaq SmallCap Market so long as the Company continued to
        meet all Nasdaq  listing  requirements,  including that at June 30, 2001
        the Company report  financial  results which reflect either net tangible
        assets above $2,000,000 or, in the alternative,  stockholders' equity of
        at  least  $2,500,000.  Both  of  these  alternative  requirements  were
        satisfied at June 30, 2001.  On August 27,  2001,  the Company  received
        further  correspondence  from Nasdaq  acknowledging that the Company had
        met the required  stockholders'  equity  requirement and requesting that
        the Company provide the Panel with certain information demonstrating the
        Company's   ability  to  sustain  long  term   compliance   with  Nasdaq
        Marketplace  Rule  maintenance  requirements.  On October  10,  2001 the
        Company received  correspondence  from Nasdaq notifying the Company that
        its common stock would  continue to be listed on Nasdaq,  subject to the
        Company  having  stockholders'  equity  of  at  least  $2,500,000  as of
        September 30, 2001, as reflected on its Quarterly Report on Form 10-QSB.
        The Panel also  required  that the Company  include in its Form 10-QSB a
        pro forma balance sheet  reflecting  significant  events or transactions
        after  September  30, 2001,  but occurring on or before the filing date.
        See Note 14. The Panel also reserved the right to modify their decision.
        In the event that the  Company's  common stock is delisted  from Nasdaq,
        the Company  expects that its common stock would trade on the NASD's OTC
        Bulletin Board.



                                       17
<PAGE>

                                  VIZACOM INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

14.     PRO FORMA BALANCE SHEET

        In accordance with the Panel's requirement, the Company has provided the
        following  pro forma  balance  sheet,  which  reflects the effect of all
        significant  events or  transactions  occurring after September 30, 2001
        and on or before November 6, 2001.

        The following  unaudited pro forma condensed  balance sheet  information
        gives effect to the pro forma  adjustment  described in the accompanying
        notes  thereto.  The  Company  is  providing  this pro  forma  financial
        information  solely in  response to the  Panel's  requirement.  This pro
        forma  financial  information  is derived from the  unaudited  financial
        statements  of the Company as of September  30, 2001.  The unaudited pro
        forma condensed consolidated balance sheet information should be read in
        conjunction  with  the  accompanying   unaudited   historical  financial
        statements  and  notes  thereto.   The  unaudited  pro  forma  condensed
        consolidated  balance sheet gives effect to this adjustment as if it had
        occurred  on  September  30,  2001  and  combines  the  effect  of  this
        adjustment with the unaudited condensed consolidated  historical balance
        sheet of the Company as of September 30, 2001.  This unaudited pro forma
        condensed   consolidated   financial   information   is  presented   for
        illustrative  purposes only and does not purport to be indicative of the
        financial  position that would have actually occurred if this adjustment
        had been  effected on the date  indicated,  nor is it  indicative of our
        future  financial  position.  The pro forma  adjustment  is based on the
        information and assumptions available as of November 6, 2001.




                                       18
<PAGE>


                                  VIZACOM INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

14.     PRO FORMA BALANCE SHEET (CONTINUED)

<TABLE>
<CAPTION>
                                                                    HISTORICAL                       PRO FORMA
                                                                      September 30,     Pro Forma  September 30,
                                                                       2001      Note  Adjustment      2001
                                                                   ----------------------------------------------
ASSETS                                                              (UNAUDITED)                     (UNAUDITED)
Current assets:
<S>                                                                    <C>                <C>          <C>
   Cash and cash equivalents                                           $ 191,056  (A)  $   200,000   $   391,056
   Marketable securities                                                       -
   Receivables
      Trade,  less allowances                                          1,198,356                 -     1,198,356
      Other                                                               62,207                 -        62,207
      Notes, current portion                                             418,549                 -       418,549
    Inventories                                                          304,609                 -       304,609
    Restricted cash                                                      150,000                 -       150,000
    Prepaid expenses and other current assets                            143,719                 -       143,719
                                                                   --------------      --------------------------
           Total current assets                                        2,468,496           200,000     2,668,496
Property and equipment, net                                              221,931                 -       221,931
Goodwill, net of accumulated amortization                              1,767,420                       1,767,420
Business processes and methodologies, workforce, and customer lists,                             -
 net of accumulated amortization                                       3,046,097                 -     3,046,097
Deferred consulting costs                                                921,826                 -       921,826
Note receivable, long term                                               384,734                 -       384,734
Other assets                                                              63,609                 -        63,609
                                                                   --------------      --------------------------
           Total assets                                               $8,874,113       $   200,000   $ 9,074,113
                                                                   ==============      ==========================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
   Bank note payable                                                  $1,214,172       $         -   $ 1,214,172
   Related party notes and other related party liabilities             1,036,525                 -     1,036,525
   Bridge loan payable, $450,000 face amount,  net of
      unamortized discount of $430,000 (proforma)                              -  (A)       20,000        20,000
   Current portion of long-term debt and capital lease obligations       239,528                 -       239,528
   Accounts payable                                                    1,845,890                 -     1,845,890
   Accrued liabilities                                                 1,499,434                 -     1,499,434
   Sales and value-added taxes payable                                     3,837                 -         3,837
                                                                   --------------      --------------------------
           Total current liabilities                                   5,839,386            20,000     5,859,386
Related party notes, long term                                           126,685                         126,685
Long-term debt and capital lease obligations, less current maturities      4,623                           4,623
                                                                   --------------      --------------------------
           Total liabilities                                           5,970,694            20,000     5,990,694
                                                                   --------------      --------------------------
Commitments and contingencies
Stockholders' equity:
   Common stock, par value $.001 per share,
       60,000,000 shares authorized, 2,504,177 (proforma) outstanding      2,404  (A)          100         2,504
   Additional paid-in capital                                         72,635,550  (A)      179,900    72,815,450

   Accumulated deficit                                               (69,548,375)                    (69,548,375)
   Accumulated other comprehensive loss                                  (95,765)                        (95,765)
   Unamortized debt discount in excess of bridge loan                    (80,000)                        (80,000)
   Treasury stock, 310 shares, at cost                                   (10,395)                        (10,395)
                                                                   --------------      --------------------------
              Total stockholders' equity                               2,903,419           180,000     3,083,419
                                                                   --------------      --------------------------
              Total liabilities and stockholders' equity              $8,874,113        $  200,000   $  9,074,113
                                                                   ==============      ==========================
</TABLE>



                                       19
<PAGE>

                                  VIZACOM INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

14.     PRO FORMA BALANCE SHEET (CONTINUED)

        NOTE TO PRO FORMA BALANCE SHEET:

        (A) - Reflects issuance of 100,000 shares of common stock, recorded as a
        debt discount,  in connection  with a $200,000  bridge loan  installment
        received from SpaceLogix  Inc. The market price of the Company's  common
        stock  was  $1.80  per  share  on  October  10,  2001,  the date of this
        transaction.

15.     COMMITMENTS AND CONTINGENCIES

        Litigation

        In the fourth quarter of 1998, an action was commenced  against Software
        Publishing  Corporation  ("SPC") in  California  in which  plaintiff  is
        seeking  $300,000 in damages for SPC's alleged  violation of a lease for
        office space  located in San Jose,  California.  This is the location at
        which SPC had its  principal  place of business and at which the Company
        had its principal  executive  offices  during the period of January 1997
        through  January  1998.  Neither the Company nor SPC  currently  has any
        offices at this location. SPC has filed an answer in this action denying
        the  plaintiffs'  claims.  In October 2000,  the  plaintiff  amended its
        complaint to name Neil M. Kaufman,  the Company's chairman of the board,
        as a defendant.  A trial setting conference is set for January 15, 2002,
        and  this  action  is  expected  to go to  trial  in  2002.  While it is
        reasonably  possible that SPC may have some  liability to the plaintiff,
        the  Company  believes  this  action,  including  the claim  against Mr.
        Kaufman, is without merit and intends to vigorously defend this action.

        In February 2000,  the Company  received a demand for  arbitration  with
        respect to certain fees payable in connection with an investment banking
        agreement  which it terminated.  The claim called for payment of $45,000
        and  reinstatement  of the warrants to purchase  15,000 shares of common
        stock cancelled upon termination of the investment  banking agreement or
        payment of the value of such  warrants,  and legal and other expenses in
        connection  with  the  arbitration.   This  arbitration  proceeding  was
        subsequently  suspended.  The Company settled this claim as of September
        30, 2001 for 130,000 shares of its common stock, valued at $240,500.

        On January 9, 2001, the Company  entered into an agreement with a German
        company to sell certain assets and liabilities of the Company's  Aachen,
        Germany  contact  center  operation,  including  the  assumption  of the
        remaining  lease  obligation.  The agreement  calls for a payment to the
        Company of approximately  $100,000,  of which approximately  $50,000 was
        expected to be utilized to pay remaining tax  obligations.  The $100,000
        payment has not been received and is past due. The Company has commenced
        legal  proceedings  to collect this amount,  the collection of which the
        Company believes is unlikely.





                                       20
<PAGE>

                                  VIZACOM INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

15.     COMMITMENTS AND CONTINGENCIES (CONTINUED)

        Litigation (cont.)

        On  February  2,  2001,  the  Company  divested  Junction  15  Ltd.  and
        interMETHODS Ltd., its London-based  subsidiaries  acquired during 2000,
        through  creditors  voluntary  liquidation  in the United  Kingdom.  The
        Company  terminated  the employment of the two executives of Junction 15
        Limited, and it currently intends to pursue  indemnification  claims for
        breaches  of  representations  and  warranties  by the  sellers  of both
        Junction  15 Limited and  interMETHODS  Limited.  On April 2, 2001,  the
        Company received a "freezing injunction order" from the Supreme Court of
        England and Wales restricting its ability to remove any assets up to the
        value of  (pound)362,000,  or  approximately  $517,000,  from England or
        Wales.  The only assets  that the  Company  owned in England or Wales at
        such  time or as of the date  hereof  is the  $150,000  in cash  that it
        received upon the closing of the Serif transaction, which is held on its
        behalf by its lawyers in England.  The  applicants  with  respect to the
        injunction are two former executive  officers of Junction 15 Limited who
        are claiming payment under their  terminated  employment  agreements.  A
        third  claimant  is a former  officer  of  interMETHODS  Limited  and is
        claiming  a  deferred  payment  of  approximately   $100,000  under  the
        interMETHODS  acquisition  agreement.  The Company  believes that it has
        significant warranty,  breach of contract and other claims against these
        applicants,  and intends to prosecute its claims vigorously. The Company
        also believes that the injunction was issued  improperly and may attempt
        to have the injunction vacated;  however, there is no assurance that the
        Company will be successful in this regard. Further, the Company believes
        that this  injunction will not affect its ability to receive and utilize
        the monthly  payments  pursuant to the  promissory  note to be made from
        Serif Inc., a U.S.  incorporated  and domiciled  company.  The matter is
        scheduled for mediation in November 2001.

        In  addition  to the  aforementioned  litigation,  the Company has other
        litigation  matters in  progress  in the  ordinary  course of  business.
        Management  believes that all pending  litigation of the Company will be
        resolved  without a further  material effect on the Company's  financial
        position, results of operations or cash flows.

        Long Term Consulting Agreement

        In 1998,  the  Company  entered  into a five-year  financial  consulting
        agreement  pursuant  to which the  Company is required to pay .3% of its
        net revenue (subject to an annual minimum fee of $125,000, and an annual
        maximum fee of $250,000) to the  consultant.  The term of the  agreement
        was automatically  extendable by eighteen months if the Company reported
        annual net revenues of  $40,000,000,  and an additional  eighteen months
        should net revenues  exceed  $60,000,000.  In December 2000, the Company
        amended this  agreement to provide that  $269,861 of accrued  consulting
        fees were payable in 123,337 shares of the Company's common stock.  This
        agreement  was  further  amended  to  increase  the  revenue  thresholds
        required for extensions to $45,000,000  and  $65,000,000,  respectively.
        Any revenues of acquired companies not introduced directly or indirectly
        by the consultant are excluded from the amended revenue thresholds.

        Employment Agreement

        On January 15, 2001, the Company's chief executive resigned. Pursuant to
        a settlement  and release  agreement,  he received  $10,500  monthly for
        consulting services through April 15, 2001 and received 30,000 shares of
        the Company's common stock. Additionally,  he is to receive five percent
        of the  gross  proceeds  received  by the  Company  from the sale of its
        visual communications operations.




                                       21
<PAGE>



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

        Statements  contained in this Quarterly  Report on Form 10-QSB/A include
"forward-looking statements" within the meaning of Section 27A of the Securities
Act and Section 21E of the  Exchange  Act.  Forward-looking  statements  involve
known and unknown risks,  uncertainties  and other factors which could cause our
actual results,  performance and  achievements,  whether expressed or implied by
such   forward-looking   statements,   not  to  occur  or  be   realized.   Such
forward-looking statements generally are based upon our best estimates of future
results, performance or achievement,  based upon current conditions and the most
recent  results of operations.  Forward-looking  statements may be identified by
the  use  of  forward-looking  terminology  such  as  "may,"  "will,"  "expect,"
"believe," "estimate,"  "anticipate," "continue" or similar terms, variations of
those terms or the negative of those terms.

        Potential  risks and  uncertainties  include,  among other things,  such
factors as:

o    the market acceptance and amount of sales of our products and services;
o    the  success  of  our  professional   internet  and  technology   solutions
     offerings,  such as business strategy formation, web site interface design,
     and systems integration;
o    our ability to consummate our proposed acquisition of SpaceLogix;
o    our ability to complete  acquisitions of other complimentary  businesses on
     satisfactory terms;
o    our success in integrating the operations of acquired companies,  including
     Vizy  Interactive - New York (also known as Renaissance  Multimedia),  Vizy
     Interactive - PWR Systems (also known as PWR Systems),  SpaceLogix, and any
     other acquired companies into a coordinated and complementary operation;
o    our  ability to develop  long-lasting  relationships  with our  clients and
     attract new clients;
o    our  ability  to  develop  long-lasting  relationships  with  our  industry
     partners and vendors and attract new industry partners and vendors;
o    the competitive and economic  environment within the industries in which we
     operate;
o    our ability to raise additional capital;
o    our ability to maintain our existing debt facilities;
o    the extent to which we are successful in developing, acquiring or licensing
     technologies which are accepted by the market;
o    our ability to attract and retain qualified personnel;
o    business and consumer trends, and economic conditions; and
o    the other factors and information disclosed and discussed in other sections
     of this Quarterly Report on Form 10-QSB/A.

        You  should  carefully  consider  such  risks,  uncertainties  and other
information,  disclosures and discussions  which contain  cautionary  statements
identifying  important  factors  that  could  cause  actual  results  to  differ
materially from those provided in the forward-looking  statements.  We undertake
no  obligation  to  publicly  update or revise any  forward-looking  statements,
whether as a result of new information, future events or otherwise.


                                       22
<PAGE>


RESULTS OF OPERATIONS

General:

        In 2000, we became a provider of professional internet and technology
solutions in addition to continuing to operate our historical visual
communications business, which included our software operations. We became a
provider of professional internet and technology solutions through the
acquisition of four companies: Renaissance Multimedia and PWR Systems in the
United States, and Junction 15 and interMETHODS in England. In early 2001, we
determined to divest our software and international operations so as to better
focus on developing our internet and technology solutions business in the U.S.
Accordingly:

        o       in February 2001, we placed Junction 15 and interMETHODS into
                creditors voluntary liquidation in the United Kingdom, thereby
                divesting these assets; and
        o       in March 2001, we sold our visual communications operations.

        Our Serif software and international operations have been classified as
discontinued operations, and our statements of operations have been reclassified
accordingly. Our results of continuing operations reflect the results of our
professional internet and technology solutions business in the U.S., which
consists of Renaissance Multimedia, Inc., which we refer to as Vizy Interactive
New York ("Vizy NY") and PWR Systems, Inc., which we refer to as Vizy
Interactive-PWR Systems ("PWR"). These businesses are collectively referred to
as Vizy Interactive. The results of our discontinued software and international
operations are presented separately below. As a result of the changes in our
business described above, our historical financial statements for periods prior
to March 31, 2000 are of limited use.

Continuing Operations:

        General: Continuing operations are represented by the operations of our
Vizy NY and PWR subsidiaries, together with our corporate overhead. We acquired
Vizy NY and PWR on February 15 and March 27, 2000, respectively.

        In light of declining gross margins and inadequate capital to support
growth in our PWR computer hardware reseller business, we attempted in the 2001
third quarter to transition that business to selling less hardware and providing
more information technology and security services, which we expect to generate
higher gross margins. We intended to maximize our gross profits from our
continued hardware sales primarily by being more selective in our hardware
customers and pricing. We expected that during at least the first 90 days of
this transition our PWR subsidiary would not generate positive cash flow. We
experienced some success in this strategy during the 2001 third quarter, though
difficult economic, credit and social conditions had a significant negative
impact on our results of operations.

        Our business was adversely affected by the events surrounding the World
Trade Center on September 11, 2001. Our Vizy NY office, which is located a few
blocks from the World Trade Center, was closed for over a week. Telephone
service was absent for a longer period. Additionally, more than 80% of PWR's
customers are located in New York City, and we found that customers delayed
purchases for various reasons, including uncertainty and absence from their
offices. The aforementioned circumstances affected our sales, our ability to
purchase products, our ability to collect receivables, and our overall
performance. We believe the events of September 11, 2001 have led to further
weakness in the economy and we expect a continuing effect on our fourth quarter
2001 results.


                                       23
<PAGE>


Quarter Ended September 30, 2001 compared to the Quarter Ended September 30,
2000.

        The results of operations for our continuing operations for the quarters
ended September 30, 2001 and 2000 are set forth below:

<TABLE>
<CAPTION>
                                           Quarter ended September 30, 2001         Quarter ended September 30, 2000
                                        --------------------------------------   ---------------------------------------
                                            Vizy                                     Vizy
                                        Interactive   Corporate      Total       Interactive   Corporate      Total
                                        --------------------------------------   ---------------------------------------
<S>                                        <C>        <C>         <C>               <C>        <C>         <C>
Net sales
 Hardware                                $ 1,477,153                $1,477,153    $ 3,763,536                $3,763,536
 Website design and other services           435,621                   435,621        565,774                   565,774
                                        --------------------------------------   ---------------------------------------
                                           1,912,774           -     1,912,774      4,329,310           -     4,329,310
Cost of sales
 Hardware                                  1,222,285                 1,222,285      3,461,213                 3,461,213
 Website design and other services           268,039                   268,039        437,665                   437,665
                                        --------------------------------------   ---------------------------------------
                                           1,490,324           -     1,490,324      3,898,878           -     3,898,878

Gross profit                                 422,450           -       422,450        430,432           -       430,432
Gross profit %                                   22%                       22%            10%                       10%

SG&A                                         750,585     324,111     1,074,696        877,805     781,714     1,659,519
Depreciation and amortization                  8,631     313,025       321,656          5,684      60,868        66,552
Amortization - goodwill,
  business processes, etc.                   321,593           -       321,593        484,993           -       484,993
Interest and other expense, net               16,689      30,749        47,438         36,363      40,852        77,215
                                        --------------------------------------   ---------------------------------------
                                           1,097,498     667,885     1,765,383      1,404,845     883,434     2,288,279
                                        --------------------------------------   ---------------------------------------
Loss from continuing operations            $(675,048) $ (667,885) $ (1,342,933)     $(974,413) $ (883,434) $ (1,857,847)
                                        ======================================   =======================================
</TABLE>

        Net Sales. Net sales from continuing operations decreased in the 2001
third quarter by $2,416,536, or 56%, to $1,912,774 from $4,329,310 in the 2000
third quarter. $1,681,438, or 88%, of these net sales are attributable to PWR,
and $231,336, or 12%, of these net sales are attributable to Vizy NY. The
majority of the decline was in hardware sales of PWR which decreased $2,286,383,
or 61%, to $1,477,153 in 2001 from $3,763,536 in 2000. Service sales also
declined $130,153, or 23%, to $435,621 in 2001 from $565,774 in 2000.We believe
that our decline in net sales was primarily attributable to PWR's inability to
obtain sufficient trade and other credit or capital required to obtain inventory
to maximize its sales, weak economic conditions particularly in the technology
sector, weaknesses at our Vizy NY subsidiary resulting from a decline in the
website design industry, and the events of September 11 discussed above. A
certain level of the sales decline at PWR Systems was expected as PWR Systems
adjusted its focus to higher margin revenues.

        Gross Profit. Gross profit decreased by $7,982, or 2%, to $422,450 in
the 2001 third quarter, from $430,432 in the 2000 third quarter. $394,276, or
93%, of our 2001 third quarter gross profit was generated by PWR, and $28,174,
or 7%, of our 2001 third quarter gross profit was generated by Vizy NY. Gross
profit on hardware sales was $254,868, or 17%. Gross profit on service sales was
$167,582, or 38%. Overall gross profit percentages increased from 10% in the
2000 third quarter to 22% in the 2001 third quarter. The increased gross margin
was attributable to PWR's net sales consisting primarily of a higher proportion
of higher margin service revenues than lower margin hardware sales. This was
offset in part by PWR's inability to obtain sufficient credit to fill orders,
which impaired its ability to obtain optimal pricing from its suppliers, as well
as the declining performance of our Vizy NY subsidiary.

        Selling, General and Administrative Expenses. Selling, general and
administrative expenses ("SG&A") decreased by $584,823, or 35%, to $1,074,696 in
the 2001 third quarter from $1,659,519 in the 2000 third quarter. The decrease
in SG&A of $127,220 at our operating subsidiaries reflects lower recruitment and
advertising costs and a reduction in the number of employees. Corporate overhead
declined $457,603 due to reductions in corporate expenses resulting from our
2001 restructuring as well as other cost reduction efforts.



                                       24
<PAGE>

        Depreciation and Amortization. Depreciation and amortization increased
$255,104 to $321,656 in 2001 from $66,552 in 2000. Corporate depreciation and
amortization increased $252,157 to $313,025 in 2001 from $60,868 in 2000. The
increase is a result of increased amortization of deferred consulting costs in
connection with various financial advisory and investor relations that we
entered into. Many of the associated programs related to these equity
instruments had short lives, and we accelerated the amortization of certain of
these deferred costs based on our expectations of future benefit.

        Amortization of Goodwill, Business Processes and Methodologies,
Workforce, and Customer Lists. Amortization of Goodwill, Business Processes and
Methodologies, Workforce, and Customer Lists, decreased $163,400, or 34%, due to
a lower amortization base in 2001 caused by the impairment writedown of PWR's
goodwill in the fourth quarter of 2000.

        Interest and other expense, net. Interest and other expense, net,
decreased by $29,777, or 39%, to $47,438 in the 2001 third quarter from $77,215
in the 2000 third quarter. The decline reflects the impact of interest income in
connection with payments under a note issued to us by our former Serif Inc.
software subsidiary, which primarily offset PWR's interest expense which was
also lower due to lower interest rates during the 2001 third quarter.


Nine-Months Ended September 30, 2001 compared to Nine-Months Ended September 30,
2000.

The results of operations for our continuing operations for the nine-month
periods ended September 30, 2001 and 2000 are set forth below:

<TABLE>
<CAPTION>
                                              Nine-months ended September 30, 2001          Nine-months ended September 30, 2000
                                           ------------------------------------------    -------------------------------------------
                                               Vizy                                         Vizy
                                           Interactive       Corporate      Total        Interactive    Corporate        Total
                                           ------------------------------------------    -------------------------------------------
<S>                                           <C>           <C>           <C>             <C>          <C>             <C>
Net sales
 Hardware                                      $ 9,065,999  $          -   $9,065,999      $8,374,820  $          -     $ 8,374,820
 Website design and other services               1,583,810             -    1,583,810       1,580,304             -       1,580,304
                                           ------------------------------------------    -------------------------------------------
                                                10,649,809             -   10,649,809       9,955,124             -       9,955,124
Cost of sales
 Hardware                                        8,003,769             -    8,003,769       7,201,292                     7,201,292
 Website design and other services               1,009,674             -    1,009,674         953,014                       953,014
                                           ------------------------------------------    -------------------------------------------
                                                 9,013,443             -    9,013,443       8,154,306             -       8,154,306

Gross profit                                     1,636,366             -    1,636,366       1,800,818             -       1,800,818
Gross profit %                                         15%                        15%             18%                           18%

SG&A                                             2,340,031     1,267,647    3,607,678       2,086,880     2,041,455       4,128,335
Depreciation and amortization                       25,814       817,496      843,310          11,423       599,657         611,080
Restructuring expenses                                   -       187,584      187,584               -             -               -
Amortization - goodwill,
  business processes, etc.                         964,777             -      964,777       1,043,697             -       1,043,697
Loss (gain) on marketable securities                              85,226       85,226               -    (1,095,348)     (1,095,348)
Interest and other expense, net                     48,273       105,716      153,989          81,058       135,624         216,682
                                           ------------------------------------------    -------------------------------------------
                                                 3,378,895     2,463,669    5,842,564       3,223,058     1,681,388       4,904,446
                                           ------------------------------------------    -------------------------------------------
Loss from continuing operations               $ (1,742,529) $ (2,463,669) $(4,206,198)    $(1,422,240) $ (1,681,388)   $ (3,103,628)
                                           ==========================================    ===========================================
</TABLE>

        Net Sales. Net sales from continuing operations increased in the
nine-months ended September 30, 2001 ("2001 nine-month period") by $694,685, or
7%, to $10,649,809 from $9,955,124 in the nine-months ended September 30, 2000
("2000 nine-month period"). $9,446,073, or 89%, of these 2001 net sales were
attributable to PWR, and $1,203,736, or 11%, of these 2001 net sales were
attributable to Vizy NY. Hardware sales increased $691,179, or 8%, to $9,065,999
in 2001 from $8,374,820 in 2000. Website design and other service sales
increased $3,506 to $1,583,810 in 2001 from $1,580,304 in 2000. Net sales from
continuing operations for the 2000 nine-month period were comprised of net sales
of Vizy NY after February 15, 2000, and net sales of PWR after March 27, 2000,
the dates on which we acquired these entities. Net sales in the 2001 nine-month
period declined



                                       25
<PAGE>

$3,887,727, or 27%, from 2000 nine-month period pro forma net sales of
$14,537,536, assuming that our continuing operations had been acquired on
January 1, 2000. We believe that this decline is primarily attributable to PWR's
inability to obtain sufficient trade and other credit or capital required to
obtain inventory to maximize its sales, weak economic conditions particularly in
the technology sector, weaknesses at our Vizy NY subsidiary resulting from a
decline in the website design industry, the events of September 11 discussed
above, as well as a change in strategy by PWR in the third quarter to focus on
gross margin rather than sales volume.

        Gross Profit. Gross profit decreased by $164,452, or 9%, to $1,636,366
in the 2001 nine-month period, from $1,800,818 in the 2000 nine-month period.
$1,208,355, or 74%, of our 2001 nine-month period gross profit was generated by
PWR. $428,011, or 26%, of our 2001 nine-month period gross profit was generated
by Vizy NY. Overall gross profit percentages declined from 18% in the 2000
nine-month period to 15% in the 2001 nine-month period. Hardware gross profit
was $1,062,230, or 12% compared to $1,173,528, or 14%. Service gross profit was
$574,136, or 36% compared to $627,290, or 40%. The overall lower gross margin
was attributable to PWR's net sales consisting primarily of lower margin
hardware and hardware-related components, despite the reversal of this trend in
the third quarter of 2001. 2001 nine-month period gross profit declined
$1,084,579, or 40%, from 2000 nine-month period pro forma gross profit of
$2,720,945, assuming that our continuing operations had been acquired on January
1, 2000. Gross margin as a percent of sales declined to 15% in the 2001
nine-month period from 19% (pro forma) in the 2000 nine-month period. The
decline is primarily attributable to our inability to obtain optimal pricing
from our suppliers due to our inability to obtain sufficient credit as well as
the declining performance of our Vizy NY subsidiary.

        Restructuring expenses. In the 2001 first quarter, we commenced a
restructuring initiative, pursuant to which we relocated our principal executive
offices, and certain members of management and other staff resigned or were
terminated. In addition, we divested our visual communications and international
operations. Restructuring expenses for the 2001 nine-month period primarily
consists of common stock valued at approximately $170,000 issued to our former
chief executive officer pursuant to a settlement and mutual release agreement.

        Selling, General and Administrative Expenses. Selling, general and
administrative expenses ("SG&A") decreased by $520,657, or 13%, to $3,607,678 in
the 2001 nine-month period from $4,128,335 in the 2000 nine-month period. An
increase in SG&A of $253,151 at our operating subsidiaries was offset by a
$773,808 decline in corporate overhead. The increase in SG&A is due to the
inclusion of a full nine-months of SG&A for our two operating subsidiaries for
the 2001 nine-month period compared to only eight months of Vizy NY SG&A for the
2000 nine-month period, and only six months of PWR SG&A in the 2000 nine-month
period. Corporate overhead declined due to reductions in corporate expenses
resulting from our 2001 restructuring as well as other cost reduction efforts.
2001 nine-month period SG&A decreased by $1,189,197, or 25%, from 2000
nine-month pro forma SG&A of $4,796,875, assuming that our continuing operations
had been acquired on January 1, 2000.

        Depreciation and Amortization. Depreciation and amortization increased
$232,230 to $843,310 in 2001 from $611,080 in 2000. Corporate depreciation and
amortization increased $217,839 to $817,496 in 2001 from $599,657 in 2000. The
increase is a result of increased amortization of deferred consulting costs in
connection with various financial advisory and investor relations that we
entered into. Many of the associated programs related to these equity
instruments had short lives, and we accelerated the amortization of certain of
these deferred costs based on our expectations of future benefit.

        Amortization of Goodwill, Business Processes and Methodologies,
Workforce, and Customer Lists. Amortization of Goodwill, Business Processes and
Methodologies, Workforce, and Customer Lists, decreased $78,920, or 8%. The
inclusion in the 2001 nine-month period of nine-months of amortization for our
two operating subsidiaries compared to eight months of Vizy NY amortization and
six-months of PWR amortization in the 2000 nine-month period, was more than
offset by the effect of lower 2001 amortization charges due to an impairment
reduction in PWR's goodwill in the fourth quarter of 2000.





                                       26
<PAGE>

        Realized Loss (Gain) on Marketable Securities. The realized loss of
$85,226 in the 2001 nine-month period represents the realization of an
investment loss in our marketable securities consisting of Xceed Inc. common
stock resulting from the bankruptcy of Xceed.

        The realized gain of $1,095,348 in the 2000 nine-month period represents
the gain recognized upon the transfer of 59,813 shares of Xceed Inc. common
stock to a finder in connection with an August 1999 agreement, based upon the
appreciation in the market value of such shares. The agreement set forth a
formula to determine the number of shares to be paid the finder upon the closing
of an acquisition target identified by such finder. The finder received 14,953
Xceed shares for the Renaissance acquisition and 44,860 Xceed shares for the PWR
acquisition, resulting in respective gains of $371,962 and $723,386.

        Interest and other expense, net. Interest and other expense, net,
decreased by $62,693, or 29%, to $153,989 in the 2001 nine-month period from
$216,682 in the 2000 nine-month period. The decline reflects the impact of
interest income received in connection with payments under a note issued to us
by our former Serif Inc. software subsidiary, which partially offset PWR's
interest expense, which also declined due to lower rates in 2001.

Discontinued Operations:

        General: Discontinued operations consist of our London internet
solutions business acquired in 2000, our historical visual communications
products segment, which included our software subsidiaries, Serif (Europe)
Limited and subsidiaries, Serif Inc., Software Publishing Corporation and
subsidiaries, our Dialog24 operations and our VisualCities.com operations.

        On January 9, 2001, we entered into an agreement with a German company
to purchase certain assets and assume certain liabilities of our Aachen, Germany
contact center operation, including the assumption of the remaining lease
obligations. The agreement calls for a payment of approximately $100,000, of
which we expected to utilize approximately $50,000 to pay remaining tax
obligations. The $100,000 payment has not been received and is past due. We have
commenced legal proceedings to collect this amount, the collection of which we
believe is unlikely.

        In February 2001, we divested through English law creditors voluntary
liquidation our two internet service firms in the United Kingdom, Junction 15
Limited and interMETHODS Limited. As of December 31, 2000, all of the assets and
liabilities of these entities were written-off, resulting in an impairment
charge of $4,511,063. We terminated the employment of the two executives of
Junction 15 Limited and interMETHODS Limited, and we currently intend to pursue
indemnification claims for breaches of representations and warranties by the
sellers of both Junction 15 Limited and interMETHODS Limited.

        On March 31, 2001, we sold our visual communications operations to the
management of our Serif subsidiaries. We received $150,000 in cash at closing
and a promissory note from Serif Inc. in the aggregate principal amount of
$987,500, which note bears interest at a rate of 10% per annum, and which is
payable $40,000 per month, except for April and November, in which months the
payments are $30,000 and $50,000, respectively. We, or one of our subsidiaries,
remain responsible for some potential liabilities. Serif (Europe) Limited
received a 12-month exclusive license in Europe and a 24-month non-exclusive
license in the rest of the world with respect to the software of our SPC
subsidiary. Serif (Europe) Limited was also granted a non-exclusive license to
use the Harvard Graphics(R) brand name for the purpose of selling repackaged
Serif products using such name. Each of such licenses shall be renewed if
minimum royalty and other conditions are met. In consideration therefor, Serif
(Europe) Limited will pay a royalty fee of 12.5% in respect of sales of SPC
software and 3% of sales of repackaged Serif software. While we continue to own
SPC, we agreed not to compete with Serif in the software business as long as the
licenses are in effect.

        Results of operations of discontinued businesses reflected income of
$139,384 for the 2001 nine-month period. Our software and overseas operations
were discontinued in the first quarter of 2001, and there was only residual
activity in the second quarter of 2001. We recognized a gain of $1,473,337 upon
the sale of our Serif software operations on March 31, 2001. LIQUIDITY AND
CAPITAL RESOURCES



                                       27
<PAGE>

        Our cash and cash equivalents decreased by $652,780 to $191,056 at
September 30, 2001 from $843,836 at December 31, 2000. We used $413,253 of cash
in our operations, and $346,214 of cash for investing activities as a result of
the disposition of cash held by our divested visual communication operations,
which was partially offset by the receipt of $57,346 in net proceeds from
financing activities.

        We had a working capital deficiency of $3,370,890 at September 30, 2001,
an improvement of $1,313,817 from our working capital deficiency of $4,684,707
at December 31, 2000. This change is primarily attributable to the sale of our
visual communications operations on March 31, 2001. See Note 6 to the
accompanying financial statements. In January 2001, we sold 149,000 shares of
common stock for aggregate gross proceeds of $372,500. The promissory note held
by us from our former visual communications subsidiary provides for us to
receive monthly installments aggregating $360,000 in 2001 and $480,000 in 2002.
In September 2001, we entered into a letter of intent to purchase a privately
held company. This privately held company agreed to lend $650,000 to us in
advance of the prospective deal. We received $250,000 in September 2001 and an
additional $200,000 in October 2001. The final $200,000 is expected in November
2001. Additionally, the letter of intent contemplates a private placement to
accredited investors raising a minimum of $1,000,000 of net proceeds for us
within 120 days of completion of the acquisition.

        As of September 30, 2001, we achieved liability and expense reductions
and restructurings of approximately $1,500,000. In that regard, we have taken
the following steps:

        o       Our President and Vice President and Chief Technology Officer
                have agreed to reductions in salary of $225,000 over eighteen
                months and to the restructuring of approximately $306,000 owed
                to them.
        o       Kaufman & Moomjian, our corporate counsel, have agreed to
                restructure $739,655 owed to them, by accepting a reduction of
                $300,000 and a secured 6.6% note for the remaining amount of
                $439,655.
        o       We have settled a pending arbitration proceeding relating to an
                investment banking agreement that we terminated.
        o       We have satisfied an outstanding liability to one of our
                vendors.

        We believe that over the next several months we will need to raise at
least an additional $2,000,000 to meet our currently anticipated liquidity and
capital expenditure requirements. We intend to seek additional financing through
one or more debt, equity, or convertible securities offerings, through the sale
of assets or through a merger or acquisition. Our letter of intent to acquire
SpaceLogix contemplates a private placement to accredited investors of at least
$1 million, and we anticipate that this private placement may raise $2 million
or more. There can be no assurance that we will be successful in completing any
such offering or offerings, sale of assets or merger or acquisition, or any
other offerings or transactions, or that the terms of any such offering or
offerings, transaction or transactions, will be beneficial to us or our
stockholders. We intend to consider all viable strategic alternatives, including
possible business combinations, to maximize stockholder value.

        We intend to utilize our available funds in 2001 to finance the working
capital requirements of our professional internet and technology solutions
business. Our cash requirements, however, may change depending upon numerous
factors, including, without limitation, the cost of integrating our businesses,
as well as personnel costs, and inventory and accounts receivable arising from
the sale and shipment of new or additional products. There can be no assurance
that we will be successful in attaining our sales or strategic goals, or that
attaining such goals will have the desired effect on our cash resources.



                                       28
<PAGE>

        Our PWR subsidiary has approximately $1,200,000 of bank short-term
renewable notes payable, which matured on October 29, 2001. PWR's obligations to
the bank are secured by a first priority lien on its assets, and we have
guaranteed these obligations. We are dependent on the availability of this
short-term bank loan to finance our PWR operations. On April 13, 2001, PWR
borrowed an additional $600,000 from this bank, with payment including interest,
at prime plus 1 1/2 %, due by May 14, 2001. This additional loan was repaid on
May 7, 2001. In connection therewith, Vincent DiSpigno and David N. Salav, two
of our officers and directors who were the former stockholders of PWR, agreed to
waive any remaining payments on notes payable by PWR to them until January 2002.
As of September 28, 2001, we reached agreement with these persons to restructure
the repayment of these notes, which are in the aggregate principal amount of
$306,951, as secured monthly payments of $25,000 commencing January 2002. See
Note 5 to the accompanying financial statements. An event of default under the
bank loan agreement occurred as a result of PWR's default to its inventory
finance lender referred to below. Subsequently, the bank renewed the loan.
However, PWR is in default to the bank because its underlying collateral is
insufficient to support PWR's level of borrowing and the loan expired on October
29, 2001. We believe that we have reached a preliminary oral agreement in
principal with the bank on a new six-month note, bearing interest at prime plus
one-half percent, with payments as follows: (a) no principal payments through
February 28, 2002, except that we will pay $125,000 out of the proceeds of our
anticipated private placement, (b) approximately $40,000 per month starting on
or about March 1, 2002 and (c) an additional $25,000 out of each $1 million in
additional net proceeds above $1 million that we raise in our anticipated
private placement. In connection with this six-month note, we will provide the
bank with a first priority lien on our promissory note from Serif Inc.
Additionally, our SPC subsidiary will guaranty these notes and grant a first
priority lien on its U.S. Harvard trademark rights. There can be no assurance
that we will be able to finalize any agreement with our bank, or that any
agreement will be on the terms described above.

        PWR also has an interim inventory financing facility for up to $300,000,
which was reduced from $500,000 in May 2001. PWR's obligation to this lender is
collateralized by a second lien on all of PWR's assets, and we have guaranteed
these obligations. On July 18, 2001, the lender notified PWR that it was in
default of its obligations under this facility in the approximate amount of
$200,000, and demanded payment of such amount. This facility was subsequently
repaid in full. On October 10, 2001, the finance company advised PWR that no
further financing would be provided until such time as it receives an
irrevocable letter of credit of not less than $50,000 in its favor from an
acceptable financial institution. If the foregoing is not received by January
11, 2002, the credit facility will be permanently terminated. Accordingly, PWR
lost approximately $300,000 of credit capacity under this facility during the
third quarter, and this loss of credit capacity has adversely affected PWR's
revenue producing ability. Additionally, a major supplier of PWR has been
granted a third lien on PWR's assets.

        In the first quarter of 2000, we entered into an unsecured line of
credit agreement for maximum borrowings of $1,000,000, at an 8% interest rate,
with a foreign company. Under this agreement, we borrowed $1,000,000 in February
2000. This loan was repaid in full with accrued interest on March 20, 2000.

        Our exposure to foreign currency gains and losses has been partially
mitigated as we have incurred operating expenses in the principal foreign
currency in which we invoiced foreign customers. As of September 30, 2001, we
had no foreign exchange contracts outstanding. Our foreign exchange gains and
losses have been substantially reduced given the divestiture of our
international operations.

        In 1999, we entered into a five-year consulting agreement pursuant to
which we are required to pay 0.3% of our net revenue (subject to an annual
minimum fee of $125,000, and an annual maximum fee of $250,000) to the
consultant. The term of the agreement was automatically extendable by an
additional eighteen months if we reported annual net revenues of $40,000,000,
and an additional eighteen months should net revenues exceed $60,000,000. In
December 2000, we amended this agreement to provide that $269,861 of accrued
consulting fees were payable in 123,337 shares of our common stock. This
agreement was further amended to increase the revenue thresholds required for
extensions to $45,000,000 and $65,000,000, respectively. Any revenues of
acquired companies not introduced directly or indirectly by the consultant are
excluded from the amended revenue thresholds. At September 30, 2001, we had
accrued $52,086 of consulting fees owing in connection with this agreement.





                                       29
<PAGE>


NET OPERATING LOSS CARRYFORWARDS

        We estimate our consolidated tax net operating loss carryforwards to be
approximately $38 million at December 31, 2000, after consideration for
limitations on the use thereof, which expire in years 2003 through 2020. Under
Section 382 of the Internal Revenue Code of 1986, as amended (the "Code"),
changes in the ownership or the business of a corporation that has net operating
loss carryforwards can result in the inability to use, or the imposition of
significant restrictions on the use of, such net operating loss carryforwards to
offset future income and tax liability of such corporation. An "ownership
change" may be deemed to have occurred under Section 382 of the Code and the
regulations thereunder with respect to both the Company and SPC, and the use by
the Company of these net operating loss carryforwards will be limited.
Utilization of the net operating loss carryforwards of SPC may be limited
further by reason of the consolidated return/separate return limitation year
rules. We estimate the maximum utilization of such net operating loss
carryforwards to be approximately $1,200,000 per year for losses through
December 31, 1996. There can be no assurance that we will be able to utilize all
of our net operating loss carryforwards. In addition, the foreign losses
incurred by SPC may decrease or otherwise restrict our ability to claim U.S. tax
credits for foreign income taxes.

SPC DUAL CONSOLIDATED LOSSES CLOSING AGREEMENT

        On May 18, 2001 we received a closing agreement with the IRS pursuant to
which we become jointly and severally liable for SPC's tax obligations upon
occurrence of a "triggering event" requiring recapture of dual consolidated
losses ("DCLs") previously utilized by SPC. This closing agreement avoids SPC's
being required to recognize a tax of approximately $8 million on approximately
$24.5 million of SPC's pre-acquisition DCLs. An event otherwise constituting a
triggering event applicable to a DCL would not constitute a triggering event if
it occurs in any taxable year after the fifteenth taxable year following the
year in which the DCL was incurred. A future acquirer of our Company may also be
required to agree to a similar closing agreement in order to avoid the same tax
liability, to the extent it is able to do so, assuming the fifteen year period
with respect to the DCL hadn't expired. This could have a material adverse
effect on our future ability to sell SPC. The report of our auditors covering
the December 31, 2000 consolidated financial statements, which was issued before
the Company received the closing agreement from the IRS, contains a paragraph
emphasizing these dual consolidated losses.

SEASONALITY

        We believe that our professional internet and technology solutions
business is not characterized by significant fluctuations, though the fourth
quarter of each year may be our period of strongest financial performance as
corporations attempt to meet their budget allocations.

INFLATION

        We believe that inflation has generally not had a material impact on our
operations.





                                       30
<PAGE>


                           PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

              Reference is hereby made to Item 3 of our Annual Report on Form
        10-KSB, for the fiscal year ended December 31, 2000, filed April 2, 2001
        (Commission File No.: 1-14076), and to the references therein, for a
        discussion of all material pending legal proceedings to which we or any
        of our subsidiaries are parties.

              In the fourth quarter of 1998, an action was commenced against
        Software Publishing Corporation ("SPC") in California in which plaintiff
        is seeking $300,000 in damages for SPC's alleged violation of a lease
        for office space located in San Jose, California. This is the location
        at which SPC had its principal place of business and at which the
        Company had its principal executive offices during the period of January
        1997 through January 1998. Neither the Company nor SPC currently has any
        offices at this location. SPC has filed an answer in this action denying
        the plaintiffs' claims. In October 2000, the plaintiff amended its
        complaint to name Neil M. Kaufman, the Company's chairman of the board,
        as a defendant. A trial setting conference is set for January 15, 2002,
        and this action is expected to go to trial in 2002. While it is
        reasonably possible that SPC may have some liability to the plaintiff,
        the Company believes this action, including the claim against Mr.
        Kaufman, is without merit and intends to vigorously defend this action.

              In February 2000, we received a demand for arbitration with
        respect to certain fees payable in connection with an investment banking
        agreement which we terminated. The claim called for payment of $45,000
        and reinstatement of the warrants to purchase 15,000 shares of common
        stock cancelled upon termination of the investment banking agreement or
        payment of the value of such warrants, and legal and other expenses in
        connection with the arbitration. This arbitration proceeding was
        subsequently suspended. We settled this claim as of September 30, 2001
        for 130,000 shares of our common stock, valued at $240,500.

              On February 2, 2001, the Company divested Junction 15 Ltd. and
        interMETHODS Ltd., its London-based subsidiaries acquired during 2000,
        through creditors voluntary liquidation in the United Kingdom. The
        Company terminated the employment of the two executives of Junction 15
        Limited, and it currently intends to pursue indemnification claims for
        breaches of representations and warranties by the sellers of both
        Junction 15 Limited and interMETHODS Limited. On April 2, 2001, the
        Company received a "freezing injunction order" from the Supreme Court of
        England and Wales restricting its ability to remove any assets up to the
        value of (pound)362,000, or approximately $517,000, from England or
        Wales. The only assets that the Company owned in England or Wales at
        such time or as of the date hereof is the $150,000 in cash that it
        received upon the closing of the Serif transaction, which is held on its
        behalf by its lawyers in England. The applicants with respect to the
        injunction are two former executive officers of Junction 15 Limited who
        are claiming payment under their terminated employment agreements. A
        third claimant is a former officer of interMETHODS Limited and is
        claiming a deferred payment of approximately $100,000 under the
        interMETHODS acquisition agreement. The Company believes that it has
        significant warranty, breach of contract and other claims against these
        applicants, and intends to prosecute its claims vigorously. The Company
        also believes that the injunction was issued improperly and may attempt
        to have the injunction vacated; however, there is no assurance that the
        Company will be successful in this regard. Further, the Company believes
        that this injunction will not affect its ability to receive and utilize
        the monthly payments pursuant to the promissory note to be made from
        Serif Inc., a U.S. incorporated and domiciled company. The matter is
        scheduled for mediation in November 2001.

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS.

              On September 18, 2001, we issued 200,000 shares of our common
        stock in connection with a bridge loan arrangement. The issuance of
        these shares was a private transaction exempt from registration pursuant
        to Section 4(2) of the Securities Act.

              On September 14, 2001, we agreed to issue an aggregate 209,580
        shares of our common stock, valued at $350,000, subject to shareholder
        approval, to the PWR selling shareholders as additional merger
        consideration in accordance with the provisions of the March 27, 2000
        merger agreement with PWR, as



                                       31
<PAGE>

        amended. The issuance of these shares will be a private transaction
        exempt from registration pursuant to Section 4(2) of the Securities Act.

              As of September 28, 2001, we settled an outstanding dispute
        pending arbitration with an investment banking firm. Pursuant to the
        settlement, we issued 130,000 shares of our common stock. The issuances
        of these shares was a private transaction exempt from registration
        pursuant to Section 4(2) of the Securities Act.

              As of September 28, 2001, we settled a payable with a law firm by
        issuing 10,000 shares of our common stock. The issuances of these shares
        was a private transaction exempt from registration pursuant to Section
        4(2) of the Securities Act.

              On October 10, 2001, we issued an additional 100,000 shares of our
        common stock in connection with the bridge loan arrangement. The
        issuance of these shares was a private transaction exempt from
        registration pursuant to Section 4(2) of the Securities Act.

              On October 15, 2001, we entered into an engagement agreement with
        an investment banking firm to provide us with a fairness opinion in
        connection with our proposed acquisition of SpaceLogix Inc. As partial
        payment of fees for services to this firm, we issued 20,000 shares of
        our common stock. The issuance of these shares was a private transaction
        exempt from registration pursuant to Section 4(2) of the Securities Act.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

              On July 18, 2001, our PWR subsidiary was notified that it was in
        default of its obligations by a provider of a temporary inventory
        finance facility in the approximate amount of $200,000. This loan was
        subsequently repaid in full. On October 10, 2001, the inventory finance
        company advised PWR that no further financing would be provided until it
        receives an irrevocable letter of credit of not less than $50,000 in its
        favor from an acceptable financial institution. If the foregoing is not
        received by January 11, 2002, the credit facility will be terminated.

              An event of default under our PWR bank loan agreement occurred as
        a result of its default to its inventory finance lender. Subsequent to
        this event of default, the bank renewed the loan on July 30, 2001.
        Additionally, PWR is also in default to the bank because its underlying
        collateral is insufficient to support PWR's level of borrowing and this
        note has expired. We believe that we have reached a preliminary oral
        agreement in principal with the bank on a new six-month note, bearing
        interest at prime plus one-half percent, with payments as follows: (a)
        no principal payments through February 28, 2002, except that we will pay
        $125,000 out of the proceeds of our anticipated private placement, (b)
        approximately $40,000 per month starting on or about March 1, 2002 and
        (c) an additional $25,000 out of each $1 million in additional net
        proceeds above $1 million that we raise in our anticipated private
        placement. In connection with this six-month note, we will provide the
        bank with a first priority lien on our promissory note from Serif Inc.
        Additionally, our SPC subsidiary will guaranty this note and grant a
        first priority lien on its U.S. Harvard trademark rights. There can be
        no assurance that we will be able to finalize any agreement with our
        bank, or that any agreement will be on the terms described above.

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

              None

ITEM 5. OTHER INFORMATION.

              None

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.

        (a)   Exhibits.



                                       32
<PAGE>

              Set forth below are all exhibits to this Quarterly Report on Form
        10-QSB.

        Number  Description

        10.1    Letter of Intent between Vizacom Inc. and Spacelogix, Inc, dated
                as of September 7, 2001. (Incorporated by reference to Exhibit
                10.1 to the Company's Current Report on Form 8-K (Date of Report
                October 10, 2001) (Commission File No. 1-14076) filed with the
                Commission on October 19, 2001.)

        10.2    Settlement and General Release Agreement, dated as of September
                28, 2001, between Vizacom and EarlyBirdCapital.com, Inc.
                (Incorporated by reference to Exhibit 10.2 to the Company's
                Current Report on Form 8-K (Date of Report October 10, 2001)
                (Commission File No. 1-14076) filed with the Commission on
                October 19, 2001.)

        10.3    Agreement, dated as of September 30, 2001, between Vizacom and
                Kaufman & Moomjian, LLC. (Incorporated by reference to Exhibit
                10.3 to the Company's Current Report on Form 8-K (Date of Report
                October 10, 2001) (Commission File No. 1-14076) filed with the
                Commission on October 19, 2001.)

        10.4    Letter agreement, dated September 30, 2001, between Vizacom and
                Kaufman & Moomjian, LLC. (Incorporated by reference to Exhibit
                10.4 to the Company's Current Report on Form 8-K (Date of Report
                October 10, 2001) (Commission File No. 1-14076) filed with the
                Commission on October 19, 2001.)

        10.5    Promissory Note, dated September 30, 2001, payable to Kaufman &
                Moomjian,LLC. (Incorporated by reference to Exhibit 10.5 to the
                Company's Current Report on Form 8-K (Date of Report October 10,
                2001) (Commission File No. 1-14076) filed with the Commission on
                October 19, 2001.)

        10.6    Security Agreement, dated as of September 30, 2001, between
                Vizacom and Kaufman & Moomjian, LLC. (Incorporated by reference
                to Exhibit 10.6 to the Company's Current Report on Form 8-K
                (Date of Report October 10, 2001) (Commission File No. 1-14076)
                filed with the Commission on October 19, 2001.)

        10.7    Amendment No. 3, dated as of September 28, 2001, to the
                Agreement and Plan of Merger, dated as of February 28, 2000,
                among Vizacom, PWR Acquisition Corp., PC Workstation Rentals,
                Inc., d/b/a PWR Systems, David N. Salav and Vincent DiSpigno.
                (Incorporated by reference to Exhibit 10.7 to the Company's
                Current Report on Form 8-K (Date of Report October 10, 2001)
                (Commission File No. 1-14076) filed with the Commission on
                October 19, 2001.)

        10.8    Amendment No. 1, dated as of September 28, 2001, to Employment
                Agreement, dated as of March 27, 2000, between Vizacom and David
                N. Salav. (Incorporated by reference to Exhibit 10.8 to the
                Company's Current Report on Form 8-K (Date of Report October 10,
                2001) (Commission File No. 1-14076) filed with the Commission on
                October 19, 2001.)

        10.9    Amendment No. 1, dated as of September 28, 2001, to Employment
                Agreement, dated as of March 27, 2000, between Vizacom and
                Vincent DiSpigno. (Incorporated by reference to Exhibit 10.9 to
                the Company's Current Report on Form 8-K (Date of Report October
                10, 2001) (Commission File No. 1-14076) filed with the
                Commission on October 19, 2001.)

        10.10   Security Agreement, dated as of September 28, 2001, between
                Vizacom and David N. Salav and Vincent DiSpigno. (Incorporated
                by reference to Exhibit 10.10 to the Company's Current Report on
                Form 8-K (Date of Report October 10, 2001) (Commission File No.
                1-14076) filed with the Commission on October 19, 2001.)

        10.11   Promissory Note, dated as of September 28, 2001, payable by PWR
                Systems, Inc. to Vincent DiSpigno. (Incorporated by reference to
                Exhibit 10.11 to the Company's Current Report on Form



                                       33
<PAGE>

                8-K (Date of Report October 10, 2001) (Commission File No.
                1-14076) filed with the Commission on October 19, 2001.)

        10.12   Promissory Note, dated as of September 28, 2001, payable by PWR
                Systems, Inc. to David N. Salav. (Incorporated by reference to
                Exhibit 10.12 to the Company's Current Report on Form 8-K (Date
                of Report October 10, 2001) (Commission File No. 1-14076) filed
                with the Commission on October 19, 2001.)

        10.13   Loan Agreement dated September 14, 2001 between Vizacom and
                SpaceLogix Inc.

        10.14   Promissory Note in the aggregate principal amount of $650,000
                payable by Vizacom to SpaceLogix, Inc.

        10.15   Security Agreement dated September 14, 2001 between Vizacom and
                SpaceLogix, Inc.

        10.16   Amendment No. 1 dated October 15, 2001 to SpaceLogix Loan
                Agreement.

        10.17   Amendment No. 1 dated October 15, 2001 to SpaceLogix Security
                Agreement.


              (b) Reports on Form 8-K.

              On October 19, 2001 we filed a Current Report on Form 8-K (Date of
        Report: October 10, 2001) with the Commission, reporting as an Item 5
        disclosure, (i) the continuance of our Nasdaq listing; (ii) the receipt
        of $450,000 of bridge loan installments from SpaceLogix, Inc., and the
        issuance of 300,000 shares of our common stock in connection therewith;
        (iii) our restructuring of over $1,000,000 of our current liabilities,
        and (iv) our obligation to issue an additional 209,580 shares of our
        common stock, subject to stockholder approval, to the PWR selling
        stockholders as additional PWR merger consideration.


                                       34
<PAGE>

                                   SIGNATURES

        In accordance with the requirements of the Exchange Act, the registrant
has caused this amendment to the report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                                                        VIZACOM INC.


Dated:  August 23, 2002                By:         /s/ Alan W. Schoenbart
                                           -------------------------------------
                                                     Alan W. Schoenbart
                                             Vice President - Finance, Treasurer
                                                 and Chief Financial Officer
                                                (Principal Financial Officer)




                                       35
<PAGE>

                                  VIZACOM INC.
                                INDEX TO EXHIBITS

        Exhibit No.       Description

        10.1    Letter of Intent between Vizacom Inc. and Spacelogix, Inc, dated
                as of September 7, 2001. (Incorporated by reference to Exhibit
                10.1 to the Company's Current Report on Form 8-K (Date of Report
                October 10, 2001) (Commission File No. 1-14076) filed with the
                Commission on October 19, 2001.)

        10.2    Settlement and General Release Agreement, dated as of September
                28, 2001, between Vizacom and EarlyBirdCapital.com, Inc.
                (Incorporated by reference to Exhibit 10.2 to the Company's
                Current Report on Form 8-K (Date of Report October 10, 2001)
                (Commission File No. 1-14076) filed with the Commission on
                October 19, 2001.)

        10.3    Agreement, dated as of September 30, 2001, between Vizacom and
                Kaufman & Moomjian, LLC. (Incorporated by reference to Exhibit
                10.3 to the Company's Current Report on Form 8-K (Date of Report
                October 10, 2001) (Commission File No. 1-14076) filed with the
                Commission on October 19, 2001.)

        10.4    Letter agreement, dated September 30, 2001, between Vizacom and
                Kaufman & Moomjian, LLC. (Incorporated by reference to Exhibit
                10.4 to the Company's Current Report on Form 8-K (Date of Report
                October 10, 2001) (Commission File No. 1-14076) filed with the
                Commission on October 19, 2001.)

        10.5    Promissory Note, dated September 30, 2001, payable to Kaufman &
                Moomjian,LLC. (Incorporated by reference to Exhibit 10.5 to the
                Company's Current Report on Form 8-K (Date of Report October 10,
                2001) (Commission File No. 1-14076) filed with the Commission on
                October 19, 2001.)

        10.6    Security Agreement, dated as of September 30, 2001, between
                Vizacom and Kaufman & Moomjian, LLC. (Incorporated by reference
                to Exhibit 10.6 to the Company's Current Report on Form 8-K
                (Date of Report October 10, 2001) (Commission File No. 1-14076)
                filed with the Commission on October 19, 2001.)

        10.7    Amendment No. 3, dated as of September 28, 2001, to the
                Agreement and Plan of Merger, dated as of February 28, 2000,
                among Vizacom, PWR Acquisition Corp., PC Workstation Rentals,
                Inc., d/b/a PWR Systems, David N. Salav and Vincent DiSpigno.
                (Incorporated by reference to Exhibit 10.7 to the Company's
                Current Report on Form 8-K (Date of Report October 10, 2001)
                (Commission File No. 1-14076) filed with the Commission on
                October 19, 2001.)

        10.8    Amendment No. 1, dated as of September 28, 2001, to Employment
                Agreement, dated as of March 27, 2000, between Vizacom and David
                N. Salav. (Incorporated by reference to Exhibit 10.8 to the
                Company's Current Report on Form 8-K (Date of Report October 10,
                2001) (Commission File No. 1-14076) filed with the Commission on
                October 19, 2001.)

        10.9    Amendment No. 1, dated as of September 28, 2001, to Employment
                Agreement, dated as of March 27, 2000, between Vizacom and
                Vincent DiSpigno. (Incorporated by reference to Exhibit 10.9 to
                the Company's Current Report on Form 8-K (Date of Report October
                10, 2001) (Commission File No. 1-14076) filed with the
                Commission on October 19, 2001.)

        10.10   Security Agreement, dated as of September 28, 2001, between
                Vizacom and David N. Salav and Vincent DiSpigno. (Incorporated
                by reference to Exhibit 10.10 to the Company's Current Report on
                Form 8-K (Date of Report October 10, 2001) (Commission File No.
                1-14076) filed with the Commission on October 19, 2001.)


                                       36
<PAGE>

        10.11   Promissory Note, dated as of September 28, 2001, payable by PWR
                Systems, Inc. to Vincent DiSpigno. (Incorporated by reference to
                Exhibit 10.11 to the Company's Current Report on Form 8-K (Date
                of Report October 10, 2001) (Commission File No. 1-14076) filed
                with the Commission on October 19, 2001.)

        10.12   Promissory Note, dated as of September 28, 2001, payable by PWR
                Systems, Inc. to David N. Salav. (Incorporated by reference to
                Exhibit 10.12 to the Company's Current Report on Form 8-K (Date
                of Report October 10, 2001) (Commission File No. 1-14076) filed
                with the Commission on October 19, 2001.)

        10.13   Loan Agreement dated September 14, 2001 between Vizacom and
                SpaceLogix Inc.

        10.14   Promissory Note in the aggregate principal amount of $650,000
                payable by Vizacom to SpaceLogix, Inc.

        10.15   Security Agreement dated September 14, 2001 between Vizacom and
                SpaceLogix, Inc.

        10.16   Amendment No. 1 dated October 15, 2001 to SpaceLogix Loan
                Agreement.

        10.17   Amendment No. 1 dated October 15, 2001 to SpaceLogix Security
                Agreement.


                                       37