<PAGE>

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

                                   FORM 10-KSB

                  Annual Report Pursuant to Section 13 or 15(d)
                     of the Securities Exchange Act of 1934

For the fiscal year ended December 31, 2003     Commission File Number 000-23734

                              SCANVEC AMIABLE, LTD.
            (Exact name of small business registrant in its charter)

                        Israel                                      N/A
            (State or other jurisdiction of                   (I.R.S. Employer
         incorporation or organization)                      Identification No.)

         International Plaza Two, Suite 625
         Philadelphia, Pennsylvania                             19113-1518
         (Address of principal executive offices)               (Zip code)

Registrant's telephone number: (610) 521-6300

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

Securities registered under Section 12(g) of the Exchange Act:

                 Ordinary Shares, Nominal Value $1.00 per share
                              (Title of each class)

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

                                    Yes  __X__  No ____


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

Registrant's revenues for the fiscal year ended December 31, 2003 were
$13,470,000.





<PAGE>

The aggregate market value of the voting stock held by non-affiliates of the
Registrant based on the trading price of the Registrant's Ordinary Shares on
March 25, 2004 was $4,545,925.

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date. As of March 25, 2004 there were
6,770,000 Ordinary Shares outstanding.

Transitional Small Business Disclosures

Yes _______                No __X__























                                        2
<PAGE>

<TABLE>
<CAPTION>
                                       SCANVEC AMIABLE, LTD. AND SUBSIDIARIES
                                             FORM 10 KSB ANNUAL REPORT

                                                       INDEX
Part I                                                                                                         Page
<S>               <C>                                                                                          <C>
     Item 1.      Description of Business........................................................................4

     Item 2.      Description of Properties......................................................................8

     Item 3.      Legal Proceedings..............................................................................9

     Item 4.      Submission of Matters to a Vote of Security Holders...........................................10

Part II

     Item 5.      Market for Registrant's Common Equity and Related Stockholder Matters.........................11

     Item 6.      Management's Discussion and Analysis of Financial Condition And Results of Operations.........13

     Item 7.      Financial Statements..........................................................................18

     Item 8.      Changes in and Disagreements with Accountants on Accounting and Financial Disclosure..........42

     Item 8A.     Controls and Procedures.......................................................................43

Part III

     Item 9.      Directors and Executive Officers of the Registrant ...........................................44

     Item 10.     Executive Compensation........................................................................47

     Item 11.     Security Ownership of Certain Beneficial Owners and Management................................50

     Item 12.     Certain Relationships and Related Transactions................................................53

Part IV

     Item 13.     Exhibits, Financial Statement Schedules and Reports on Form 8-K...............................54

     Item 14      Principal Accountant Fees and Services........................................................57

Signatures
Exhibit Index

</TABLE>


                                                         3
<PAGE>



ITEM 1.  DESCRIPTION OF BUSINESS

General

This report on Form 10-KSB contains forward-looking statements that involve
risks and uncertainties. Actual results could differ materially from those
discussed in the forward-looking statements as a result of certain factors,
including but not limited to those set forth in Item 6 "Management's Discussion
and Analysis of Financial Condition and Results of Operations" below and
elsewhere in this report on Form 10-KSB. The following discussion should be read
in conjunction with Part II of this Form 10-KSB and the Consolidated Financial
Statements and notes to the Consolidated Financial Statements beginning on page
18. As used in this annual report on Form 10-KSB, unless the context otherwise
requires, "we," "us," "our," or "Company," refers to Scanvec Amiable, Ltd.

Scanvec Amiable, Ltd. was organized as an Israeli corporation in 1990. The
"Company" or "Scanvec" designs, manufactures, markets and supports
high-performance software for the sign making, digital printing and other
graphics-intensive industries. The Company's products for the sign making market
include their flagship design program FlexiSIGN as well as CASmate. The Company
also offers the PhotoPRINT product for the wide format color printing market,
EnRoute for the routing and machining markets and several other software
packages for the woodworking, metalworking and textile industries. The Company
is a market leader in the industry and believes that it is the largest supplier
of design and production software to the sign making and graphics-related
markets, with more than 90,000 software products installed worldwide. The
Company's strategy is to strengthen its position by expanding its current line
of products to include additional innovative products that compliment the
existing line.

Effective October 29, 1999, due to the Company's failure to meet certain
requirements of NASDAQ rules, the Company's Ordinary Shares were de-listed from
the NASDAQ National Market. Since that date, the securities of the Company have
been traded on the OTC Bulletin Board.

The Company utilizes independent distributors to market and sell its products
worldwide. There can be no assurance that these distributors will give a high
priority to the marketing of the Company's products or that they will continue
to sell the Company's products. The Company's results of operations could also
be materially adversely affected by changes in the financial position of a
distributor, which could occur rapidly, or by other changes in the distributor's
business or marketing strategy.

The Company sold its 63.8% ownership interest in Scanvec Garment Systems Ltd.
effective October 1, 2002 for $215,000. The Company received cash of $35,000 and
a Note Receivable of $180,000. The buyer has provided collateral and a personal
guarantee to secure repayment of the $180,000 Note Receivable. The Company may
realize future commissions in excess of the $180,000 if the buyer exceeds
certain revenue amounts or attracts additional capital investment in Scanvec
Garment Systems, Ltd. The Company realized a gain of $66,000 on this
transaction. The Company's Consolidated Statements of Operations in Item 7
include no activity of Scanvec Garment Systems Ltd.'s results in 2003 and
includes nine months of results in 2002.





                                        4
<PAGE>

The Company employed 64 full-time employees at December 31, 2003.

Research and Development expenses, net were $2.505 million and $2.976 million in
the years ended December 31, 2003 and 2002, respectively. These expenses are
further discussed in Item 6 of this document.

The Company does not believe that environmental matters have had a significant
effect on the Company's operations to date.

The Company manages its business on a basis of one reportable operational
segment. See Note 13 to the Company's Consolidated Financial Statements:
Segments, Customer and Geographic Information for data presented in accordance
with SFAS 131 "Disclosures about Segments of an Enterprise and Related
Information," which is part of the Consolidated Financial Statements in Item 7
of this document.

Industry Background

A variety of industries, including the sign making, graphic arts, textile,
woodworking and printing industries, can utilize computer technologies in the
design and production processes, including input and output devices, graphic
design software, optimization software and software which drives the output
devices and coordinates the production process. Many manufacturing companies in
these industries are small to medium-size businesses, which in the past may not
have been able to afford automated production devices. The Company believes that
several hundred thousand of these manufacturers exist worldwide. Through 2003,
the Company's products have been directed to the sign making industry, although
the Company also has introduced products directed to other graphics-intensive
industries described below.

Sign Making

The professional sign making industry designs and manufactures the various types
of signs that businesses require, including window signs and awnings,
illuminated signs, building/store identification signs, interior office signs,
nameplates, decals, trade show stands, banners, advertising promotions and
prototypes, retail displays, exterior displays, monuments and roadway and safety
signs. Sign makers utilize a variety of materials in the making of signs, such
as vinyl, glass, metal, plastics, wood and ceramics.

The sign making industry is often segmented according to the type and method of
sign production, including vinyl cutting (the most common type of sign making
and consequently the largest segment), screen printing (for mass-volume
production), wide-format printing (for short-run applications, including
posters), engraving (for cutting or etching small two- or three-dimensional
signs from glass, metal, plastic, and wood), routing (for production of larger
three-dimensional signs from glass, metal, plastic, and wood), neon and others.
Sign makers are generally small to medium-sized businesses. However, the recent
introduction of technologically advanced, lower-cost hardware devices and
easy-to-use, powerful computers has enabled corporations and other institutions
to create signs in-house.






                                        5
<PAGE>


In addition to the sign maker's traditional vinyl cutting business, new
opportunities are emerging in the wide format printing services market. Both
Scanvec and manufacturers of wide format printers are aggressively marketing
these capabilities to the sign making market. Large format printing enables the
sign maker to offer new services to existing clients and to expand into new
service areas such as point of purchase displays, exhibition graphics and
advertising posters. The Company positioned itself for growth in this segment by
including wide format printing capabilities in its FlexiFamily of products.

Computer technology has generally replaced the traditional hand production of
signs. The Company believes that computer-aided sign making, utilizing both
hardware and software, has been broadly implemented in the developed countries
of the world. The products used in this market include various computer hardware
devices, which are used in connection with both the design of signs (input
devices such as scanners, digitizing tablets and plotters) and the production of
signs (output devices such as printers, engravers, routers and cutting devices),
and software products which are used to design sign layouts and graphic
components and to drive output devices.

Computer-aided sign making requires the integration of these devices, to permit
a graphic design that is an image on a computer screen to be transformed into a
precisely cut and/or printed production item. CAS software permits the extensive
manipulation of design elements such as fonts, shapes, shadows and similar
items. It also enables the designer to generate instructions that will direct
cutting, plotting, printing, engraving or routing machinery to generate those
design elements on a variety of materials and drives the actual machinery that
produces the finished sign. Many output devices, which generally range in price
from $5,000 to $50,000, have CAS software integrated into them. By contrast,
open architecture software is compatible with other software packages, enabling
clear communication and creating easy transfers between products, as well as
with a variety of hardware input and output devices. This capability enables a
sign maker to participate in more than one segment of the industry without
purchasing additional software systems. The Company believes that PC-based, open
architecture systems can provide cost-efficient solutions compared to other
types of computer-aided and non-computer-aided devices.

In addition to sign making, several other graphics-intensive industries have
similar design and production requirements:







                                        6
<PAGE>

Graphic Arts

The graphic arts market worldwide is divided into several segments - independent
designers and graphic studios, advertising, in-house corporate graphics
departments and sign makers. Designers work with special purpose software to
design and manipulate images and graphic elements to produce a completed design
and they require another software solution to layout (prepare) and print the
image in large format. The Company's PhotoPRINT product utilizes Raster Image
Processing (RIP) technology and is aimed at this market.

Printing

Wide format printing is employed in short run applications such as the
production of billboards and posters, in the proofing process of gravure
printing and as an alternative to the traditional chemical process of single
print picture enlarging. Wide format printing is performed by machines designed
for specific technologies that generally cost between $5,000 and $150,000 and
which can cost up to $400,000 for the grand (large) format machines. These
machines require specialized software to address problems raised by large image
size, such as memory and communications problems, color matching and color
reproduction. In addition, screen-printing is used to print on a variety of
products made from plastic, fabrics and other materials. The screen-printing
process can utilize precision design software to overcome common problems in the
process, such as positioning of color layers, the need to print base layers of
"natural" colors and the need to enhance colors.

Woodworking

The home and office woodwork industry can utilize advanced design and carving
tools to permit the carpenter or architect to design sophisticated and artistic
decorations for door frames, kitchen and closet doors, tables and other wooden
objects. While hand-made wood ornaments have always been valued, labor costs
have increased the prices of such products to levels that are not affordable by
most people. The Company believes that modern output devices, combined with
easy-to-use software, can facilitate these applications and make the manufacture
of these products more cost-efficient.





                                        7
<PAGE>


ITEM 2.  DESCRIPTION OF PROPERTY

The Company does not own any real property. The Company currently leases
approximately 21,454 square feet in Philadelphia, Pennsylvania at a monthly
rental of approximately $37,000. The space is utilized for the Company's
corporate offices. The lease term expires on December 31, 2005. In addition the
Company leases approximately 95 square meters in Tel Aviv, Israel, at a monthly
rental of approximately $1,200. This space is utilized for operations in Israel.
The Company leases approximately 214 square meters in Zaventem, Belgium, at a
monthly rental of approximately $2,875. This lease is for a period of nine
years, which began in September 2000. This space is utilized for sales and
customer support of the Company's operations in Europe, Africa and the Middle
East. The Company leases approximately 400 square feet in Moscow, Russia at a
monthly rental of $3,560. The space is utilized for additional research and
development staff.

The Company also leases a small amount of office space in Orange County,
California and Hamburg, Germany at a monthly rental of approximately $300 and
$600 respectively. The Company believes that its current facilities are adequate
for development and production operations as currently conducted and are
adequately covered by insurance. In the event that additional facilities are
required, the Company believes that it could obtain such additional facilities
without difficulty and at commercially reasonable prices.










                                        8
<PAGE>

ITEM 3.  LEGAL PROCEEDINGS

         In August 2002, the Company filed a complaint, against several former
directors and employees and an entity, owned by such former directors and
employees, in the U.S. District Court for the Eastern District of Pennsylvania
(the "Federal Court"), charging the defendants with misappropriation of Company
intellectual property, misuse of confidential information, violation of the
Lanham Act and several other violations of U.S. law. The defendants include
former directors, Jim Chang and Yuan Chang, who currently own 17.3% and 8.6%
respectively of the Company's outstanding Ordinary Shares (see Item 11).

The U.S. Federal Court granted a preliminary injunction in December 2002
prohibiting the defendants from continuing their activities worldwide, effective
immediately. The injunction prohibits the defendants from carrying on business
in competition with the Company pending the outcome of a full trial. On October
13, 2003, the United States Court of Appeals for the Third Circuit upheld the
injunction.

The Company has posted a $390,000 Letter of Credit in accordance with the
Court's directive to provide a security bond (see Note 9 of the Consolidated
Financial Statements). The Letter of Credit will remain in place until the trial
and is designated to cover losses incurred by defendants due to the injunction
if they prevail at the trial. The Company seeks to collect damages and
reimbursement of legal expenses as a result of a successful outcome as well as
restrictions on the defendants' future business practices.



















                                        9
<PAGE>



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

         The Company held its Annual General Meeting of Shareholders on December
30, 2003 in Tel Aviv, Israel. At the meeting, the following persons were elected
as directors of the Company for a term of one year: Mr. Benjamin Givli, Dr.
Ramon Harel, Mr. Moti Dabi, Mr. Yoav Doppelt and Mr. Shmulik Aran. Ms. Aliza
Rotbard has been an independent director of the Company since August 1998. Her
current term expires in August 2004. Mr. Avi Heifetz was elected as an
independent director of the Company in December 2002 for a period of three
years. No vote was required regarding Ms. Rotbard or Mr. Heifetz.

         The following matters were voted upon at the Annual General Meeting of
Shareholders:

         1.   The election of five non-independent directors. 3,701,626 Ordinary
              Shares voted in favor of each nominee for directors and 289,903
              Ordinary Shares voted against the election of each nominee and
              1,000 Ordinary Shares abstained.


         2.   To approve the appointment of Grant Thornton LLP as independent
              auditors of the Company for the year ending December 31, 2003.
              3,992,529 Ordinary Shares voted in favor, zero Ordinary Shares
              voted against and zero Ordinary Shares abstained.
















                                       10
<PAGE>


Item 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

         In October 1995, the Company consummated an initial public offering
(the "Public Offering") of 1,610,000 Ordinary Shares. At such time, the Ordinary
Shares were listed on the NASDAQ National Market ("NASDAQ"). Effective October
29, 1999, due to the Company's failure to meet certain requirements of NASDAQ
rules, the Company's Ordinary Shares were de-listed from the NASDAQ Stock
Market. After such date, the securities of the Company commenced trading on the
OTC Bulletin Board.

         The following table illustrates the high and low bid prices for the
Company's common equity for each quarter within the last two fiscal years. Such
information was extracted from a NASDAQ internet quotation service. These
quotations reflect inter-dealer prices, without retail mark-up, markdown or
commission, and may not represent actual transactions.


---------------------------------------------------------------
                                                   QTR
2002                      HIGH        LOW          CLOSE
----                      ----        ---          -----
---------------------------------------------------------------

---------------------------------------------------------------
Qtr 1                     $ .600      $ .400       $ .420
---------------------------------------------------------------

---------------------------------------------------------------
Qtr 2                     $ .420      $ .420       $ .420
---------------------------------------------------------------

---------------------------------------------------------------
Qtr 3                     $ .550      $ .420       $ .550
---------------------------------------------------------------

---------------------------------------------------------------
Qtr 4                     $ .550      $ .420       $ .430
---------------------------------------------------------------

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

---------------------------------------------------------------
                                                   QTR
2003                      HIGH        LOW          CLOSE
----                      ----        ---          -----
---------------------------------------------------------------

---------------------------------------------------------------
Qtr 1                     $ .500      $ .370       $ .500
---------------------------------------------------------------

---------------------------------------------------------------
Qtr 2                     $ .500      $ .370       $ .370
---------------------------------------------------------------

---------------------------------------------------------------
Qtr 3                     $ .380      $ .370       $ .370
---------------------------------------------------------------

---------------------------------------------------------------
Qtr 4                     $ .750      $ .370       $ .630
---------------------------------------------------------------







                                       11
<PAGE>

Ordinary Shares

         The Company's Ordinary Shares, each having a nominal value of NIS (New
Israeli Shekel) 1.00, were listed on the NASDAQ National Market, under the
symbol SVECF, from October 18, 1995 until October 29, 1999. The Ordinary Shares
are not listed on any other stock exchange and have not been publicly traded
outside the United States.

         As of November 25, 2003, there were approximately 14 record holders of
Ordinary Shares.

         On June 1, 1999, the Company was advised by the NASDAQ Stock Market,
Inc. that the Company's Ordinary Shares were not in compliance with certain of
the "maintenance requirements" which must be satisfied in order to maintain the
listing of the Company's Ordinary Shares on the NASDAQ National Market,
including the requirement regarding the market value of the public float. The
Company was further advised that if the maintenance requirements were not
satisfied on or before August 31, 1999, the Company's Ordinary Shares would be
subject to immediate de-listing from the NASDAQ National Market. Effective
October 29, 1999, due to the Company's failure to meet certain requirements of
NASDAQ rules, the Company's Ordinary Shares were de-listed from the NASDAQ Stock
Market. Thereafter, the securities of the Company commenced trading on the OTC
Bulletin Board.

Dividends

         The Company has not declared or paid any cash dividends in the last
three fiscal years. Under Israeli law, the declaration of any final annual cash
dividends requires shareholder approval; shareholders may reduce but not
increase the amount of a dividend from the amount proposed by the Board. Cash
dividends may be paid by an Israeli company only out of unconsolidated retained
earnings of the Company as determined for statutory purposes. Under current
Israeli foreign currency regulations, any dividends or other distributions paid
in respect of Ordinary Shares may be freely repatriated in non-Israeli
currencies at the rate of exchange prevailing at the time of conversion,
provided that Israeli income tax has been paid on (or withheld from) such
payments.






                                       12
<PAGE>

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

                              Results of Operations


Revenues. In 2003, total revenues decreased approximately 12.2% to $13,470,000
from $15,345,000 in 2002. Comparable Sales declined $603,000 or 4% in 2003. The
activity in the various sales territories was: sales increased in North America
by $291,000; in Europe by $581,000 and Asia by $488,000. Economic problems in
South America caused a sales decrease of $85,000. Revenue from Original
Equipment Manufacturers (OEMs) decreased $1,878,000 in 2003, due to reductions
in printer sales. OEM revenue accounted for approximately 26% of revenues in
2003 compared to 35% of revenues in 2002. Approximately $1,272,000 or 67.8% of
the reduction in consolidated revenue resulted from the Company's sale of its
63.8% ownership in Scanvec Garment Systems Ltd. (SGS), which was effective
October 1, 2002. The 2002 consolidated sales contained nine months of SGS sales
while 2003 consolidated sales contain no SGS sales.

Gross Profit. Cost of revenues consists of component costs, logistics costs,
wages and benefits and overhead related to the production and assembly of the
Company's software products, as well as royalty payments to Israel's Office of
the Chief Scientist (the "OCS"), royalty payments to third parties and
amortization of capitalized product development costs. Gross margin (i.e., gross
profit as a percentage of sales) can be affected by a number of factors,
including sales volume, product sales mix and overhead expenses.

The Company's gross profit decreased to $10,213,000 for 2003, from a gross
profit of $11,580,000 in 2002. Approximately $893,000 or 65.3% of the reduction
in gross profit resulted from the Company's sale of its 63.8% ownership in
Scanvec Garment Systems Ltd. (SGS), which was effective October 1, 2002. The
remaining decline in the gross profit is attributable to the lower sales volume.
The 2003 consolidated gross profit as a percentage of sales increased in 2003 to
75.8% from 75.5% in 2002.

Research and Development. Gross research and development expenses consist
primarily of wages and benefits, and, to a lesser extent, costs of materials,
depreciation and other costs. Net research and development expenses reflect the
deduction from gross research and development expenses of the amounts related to
certain computer software development expenses capitalized by the Company.

Research and development expenses decreased by 15.8% from $2,976,000 in 2002 to
$2,505,000 in 2003. Approximately $335,000 or 71.1% of the reduction in research
and development expenses resulted from the Company's sale of its 63.8% ownership
in Scanvec Garment Systems Ltd. (SGS), which was effective October 1, 2002.

As a percentage of revenue, net research and development expenses decreased to
18.6% in 2003, compared to approximately 19.4% of revenue in 2002.





                                       13
<PAGE>

Selling and Marketing. Selling and marketing expenses consist primarily of costs
related to promotion, advertising and trade shows, wages and benefits (including
sales commissions), travel and related expenses and customer service. In 2003,
selling and marketing expenses decreased by 15.9% to $4,976,000 from $5,916,000
in 2002. Approximately $436,000 or 46.4% of the reduction in selling and
marketing expenses resulted from the Company's sale of its 63.8% ownership in
Scanvec Garment Systems Ltd. (SGS), which was effective October 1, 2002.

As a percentage of revenue, selling expenses decreased to 36.9% in 2003,
compared to approximately 38.6% of revenue in 2002.

General and Administrative. General and administrative expenses consist
primarily of wages and benefits for administration, finance and general
management personnel, as well as office maintenance, legal and accounting fees
and other costs. General and administrative expenses decreased approximately
23.4% to $2,294,000 in 2003, from $2,995,000 in 2002. Approximately $313,000 or
44.7% of the reduction in general and administrative expenses resulted from the
Company's sale of its 63.8% ownership in Scanvec Garment Systems Ltd. (SGS),
which was effective October 1, 2002.

As a percentage of revenue, general and administrative expenses represented
approximately 17.0% of revenue in 2003, compared to 19.5% of revenue in 2002.

Other Income/Expenses. Other income/expenses consists of interest on short-term
deposits and income from exchange rate fluctuations, less interest on short-term
debt and expenses from exchange rate fluctuations and gains/losses from
disposition of assets. Total other income was $76,000 in 2003 compared to
$202,000 in 2002. Interest contributed a net expense of $29,000 in 2003 compared
to a net expense of $66,000 in 2002. Exchange rate fluctuations contributed net
income of $105,000 in 2003 compared to net income of $202,000 in 2002. A $66,000
gain from the sale of a subsidiary's stock was realized in 2002. No such
transaction took place in 2003.

Income Taxes. The Company recorded a provision for income taxes of $22,000 in
2003. In 2002, the Company recorded a provision for income taxes of $13,000. The
Company has net loss carry-forward credits.

Net Income (Loss). As a result of the foregoing, net income for 2003 was
$492,000 compared to a net loss of $(118,000) in 2002. The net differences
between 2003 and 2002 are: a $2,112,000 reduction in operating expenses offset
by a $1,367,000 reduction in gross margin, a $60,000 decrease in financial
income, a $66,000 reduction in gain from the sale of an investment and a $9,000
increase in tax expense.







                                       14
<PAGE>

Liquidity and Sources of Capital
--------------------------------

At December 31, 2003, the Company had $1,261,000 in cash and cash equivalents.


The Company historically has met its financial requirements primarily through
cash provided by operations, which totaled $309,000 during 2003. Investing
activities used $370,000 of cash primarily for the capitalization of software
costs and purchase of property and equipment. Financing activities used $87,000
of cash for payments of obligations under capital leases. The effect of the
exchange rate between the Euro and the U.S. dollar resulted in a $12,000
increase to cash and cash equivalents at December 31, 2003. Total net cash and
cash equivalents decreased during 2003 by $136,000. Current assets have
increased to $4,685,000 at the end of 2003 from $4,640,000 at the end of 2002
with the increase due to trade accounts receivable. The Company believes that
the collectibility of receivables has not declined even though the total
outstanding value of the receivables has increased.

The Company has $116,000 in long-term capital lease obligations of which $78,000
is due in 2004. It is anticipated that these debts will be adequately funded
from operating cash flows.

 The Company has a $500,000 line of credit agreement that expires in December
2004. As of December 31, 2003, there were no borrowings under this facility.
Borrowings under the agreement bear interest based on the then-current prime
rate of the bank, plus one percentage point. The rate at year-end was 5.0%. The
agreement is secured by $200,000 in restricted cash, as well as the other assets
of the Company. The credit agreement contains financial and other covenants,
including maintenance of certain financial ratios and a minimum level of net
worth. Events of default under the credit agreement include failure to perform
covenants, material adverse change, and change of control of the Company. Under
the terms of the credit agreement, all amounts borrowed under it are immediately
due and payable. The Company has issued a $390,000 letter of credit against the
agreement in connection with the outstanding litigation described in Item 3 of
this report. At December 31, 2003, the Company has met all covenants and
conditions under its various lending and funding agreements.

Inflation and Seasonality
-------------------------

The Company does not believe that inflation or seasonality has had a significant
effect on the Company's operations to date.

Environmental Matters
---------------------

The Company does not believe that environmental matters have had a significant
effect on the Company's operations to date.





                                       15
<PAGE>

Critical Accounting Policies
----------------------------

Management's Discussion and Analysis of Financial Condition and Results of
Operations discusses the Company's consolidated financial statements, which have
been prepared in accordance with accounting principles generally accepted in the
United States. The preparation of these financial statements requires management
to make estimates that affect the amounts reported in the financial statements
and accompanying notes. On an on-going basis, management evaluates its estimates
and judgments, including those related to bad debts, intangible assets
(including capitalized software), income taxes, financing operations, and
contingencies and litigation. Management bases its estimates and judgments on
historical experience and on various other factors that are believed to be
reasonable under the circumstances, the results of which form the basis for
making judgments about the carrying values of assets and liabilities that are
not readily apparent from other sources. Actual results may differ from these
estimates under different assumptions or conditions.

The following accounting policies are the most critical and could impact our
results of operations:

Revenue Recognition - The Company recognizes revenue from software sales in
accordance with Statement of Position (SOP) 97-2, "Software Revenue
Recognition," as amended. This pronouncement requires among other things, that
the Company make judgments regarding when persuasive evidence of an agreement
exists, when delivery of the products has occurred, when no significant
obligations with regard to implementation remain, and when the fee is fixed or
determinable and collectibility is probable. Management reviews the contractual
terms of its agreements as well as the substance of the individual transactions
in making these judgments.

Deferred Taxes - The Company maintains a valuation allowance with regard to its
deferred tax assets due to its history of losses and the uncertainty with regard
to the Company's ability to generate sufficient taxable income in the future to
realize the deferred tax assets.

Capitalized Software Development Costs - The Company capitalizes software
development costs after technological feasibility of the software is established
and through the product's availability for general release to the Company's
customers. Technological feasibility of the Company's software development costs
is determined when the planning, designing, coding, and testing activities are
completed and the Company has established that the product can be produced to
meet its design specifications. All costs incurred in the research and
development of new software products and costs incurred prior to the
establishment of technological feasibility are expensed as incurred. All costs
incurred after the product is released to the Company's customers are expensed
as incurred.







                                       16
<PAGE>

Amortization of software development costs is calculated as the greater of the
amount computed using (i) the ratio that current gross revenues for a product
bear to the total of current and anticipated future gross revenues of that
product or (ii) the straight-line method over the remaining estimated economic
life of the product, which is estimated to be two years. Amortization of such
costs commenced in November 2002 and resulted in $46,000 being charged to
operations in 2002 resulting in un-amortized capitalized software development
costs of $486,000 on the December 31, 2002 Balance Sheet. An additional $292,000
of software development costs were capitalized during 2003 and $285,000 of
amortization expense was charged to operations in 2003. There were $493,000 of
un-amortized capitalized software development costs on the December 31, 2003
Balance Sheet.

Management's Discussion and Analysis of Financial Condition and Results of
Operations should be read in conjunction with the Company's consolidated
financial statements set forth below under Item 7.

Statements that are not historical facts, including statements about the
Company's confidence, strategies, expectations about new or existing products,
technologies, opportunities, market demand or acceptance of new or existing
products are forward-looking statements that involve risks and uncertainties.
These uncertainties include, but are not limited to product demand and market
acceptance risk, impact of competitive products and prices, product development,
commercialization or technological delays or difficulties, and trade, legal,
social, financial and economic risks.













                                       17
<PAGE>

Item 7.               Scanvec Amiable Ltd. and Subsidiaries

                        Consolidated Financial Statements


                 For the years ended December 31, 2003 and 2002


                                    Contents


Report of Independent Certified Public Accountants...........................19

Audited Consolidated Financial Statements

Consolidated Balance Sheets..................................................21
Consolidated Statements of Income............................................22
Consolidated Statements of Shareholders' Equity..............................23
Consolidated Statements of Cash Flows........................................24
Notes to the Consolidated Financial Statements...............................26






























                                       18
<PAGE>

               Report of Independent Certified Public Accountants

To the Shareholders and Board of Directors
Scanvec Amiable Ltd. and Subsidiaries

We have audited the accompanying consolidated balance sheet of Scanvec Amiable
Ltd. and subsidiaries as of December 31, 2003, and the related consolidated
statements of income, shareholders' equity, and cash flows for the year then
ended. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audit.

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

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Scanvec Amiable Ltd.
and subsidiaries as of December 31, 2003, and the results of their operations
and their cash flows for the year then ended, in conformity with accounting
principles generally accepted in the United States.

/s/ Grant Thornton LLP

Philadelphia, Pennsylvania
March 12, 2004







                                       19
<PAGE>



                         Report of Independent Auditors

To the Shareholders and Board of Directors
Scanvec Amiable Ltd. and Subsidiaries

We have audited the accompanying consolidated balance sheet of Scanvec Amiable
Ltd. and subsidiaries as of December 31, 2002, and the related consolidated
statements of operations, shareholders' equity, and cash flows for the year then
ended. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audit.

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

In our opinion, the financial statements referred to above present fairly, in
all material respects, the consolidated financial position of Scanvec Amiable
Ltd. and subsidiaries at December 31, 2002, and the consolidated results of
their operations and their cash flows for the year then ended, in conformity
with accounting principles generally accepted in the United States.

                                                            /s/Ernst & Young LLP


Philadelphia, Pennsylvania
March 7, 2003



                                       20
<PAGE>




                             Scanvec Amiable Ltd. and Subsidiaries

                                  Consolidated Balance Sheets

                   (Amounts in thousands except share and per share amounts)
<TABLE>
<CAPTION>
                                                                            December 31
                                                                        2003            2002
                                                                      -------         -------
<S>                                                                   <C>             <C>
Assets
Current assets:
   Cash and cash equivalents                                          $ 1,261         $ 1,397
   Accounts receivables, net of allowance for doubtful
     accounts of $182 and $149 in 2003 and 2002,
     respectively                                                       2,605           2,468
   Other current assets                                                   647             584
   Inventory                                                              172             191
                                                                      -------         -------
Total current assets                                                    4,685           4,640

Property and equipment, net                                               309             413
Deferred tax asset, net                                                   425             425
Intangibles and other assets                                              565             627
                                                                      -------         -------
Total assets                                                          $ 5,984         $ 6,105
                                                                      =======         =======

Liabilities and shareholders' equity
Current liabilities:
   Accounts payable                                                   $   703         $   919
   Accrued expenses                                                     1,849           2,169
   Current maturities of capital lease obligations                         78             126
                                                                      -------         -------
Total current liabilities                                               2,630           3,214

Capital lease obligations, net of current maturities                       38              77
Other long-term liabilities                                                59              61
                                                                      -------         -------
                                                                           97             138
Shareholders' equity:
   Share capital:
     Ordinary shares of NIS 1 par value:
      Authorized: 10,000,000 shares; issued and outstanding:
       6,770,000 shares                                                 1,523           1,523
   Additional paid-in capital                                           8,531           8,531
   Accumulated other comprehensive income                                  27              15
   Accumulated deficit                                                 (6,824)         (7,316)
                                                                      -------         -------
Total shareholders' equity                                              3,257           2,753
                                                                      -------         -------
Total liabilities and shareholders' equity                            $ 5,984         $ 6,105
                                                                      =======         =======
</TABLE>

See accompanying notes.






                                              21
<PAGE>

                              Scanvec Amiable Ltd. and Subsidiaries

                                Consolidated Statements of Income


                    (Amounts in thousands except share and per share amounts)

<TABLE>
<CAPTION>
                                                                      Year ended December 31
                                                                      2003               2002
                                                                   ----------         ----------
<S>                                                                <C>                <C>
Revenues:
   Software licenses and other                                     $   10,649         $   11,126
   Royalties                                                            2,821              4,219
                                                                   ----------         ----------
Total revenues                                                         13,470             15,345

Cost of revenues                                                        3,257              3,765
                                                                   ----------         ----------
Gross profit                                                           10,213             11,580
                                                                   ----------         ----------

Operating costs and expenses:
   Research and development                                             2,505              2,976
   Selling and marketing                                                4,976              5,916
   General and administrative                                           2,294              2,995
                                                                   ----------         ----------
Total operating costs and expenses                                      9,775             11,887
                                                                   ----------         ----------
Income (loss) from operations                                             438               (307)

Other income (expense):
   Interest income                                                          2                  8
   Interest expense                                                       (31)               (74)
   Foreign currency gain                                                  105                202
   Gain from sale of subsidiary stock                                       -                 66
                                                                   ----------         ----------
Total other income                                                         76                202
                                                                   ----------         ----------
Income (loss) before provision for income taxes                           514               (105)

Provision for income taxes                                                (22)               (13)
                                                                   ----------         ----------
Net income (loss)                                                  $      492         $     (118)
                                                                   ==========         ==========

Net income (loss) per share--basic and diluted                     $      .07         $    (0.02)
                                                                   ==========         ==========
Weighted average shares outstanding--basic and diluted              6,770,000          6,770,000
                                                                   ==========         ==========
</TABLE>



See accompanying notes.



                                              22
<PAGE>

<TABLE>
<CAPTION>
                                                          Scanvec Amiable Ltd. and Subsidiaries

                                                     Consolidated Statements of Shareholders' Equity

                                                                 (Amounts in thousands)

                                                                                  Accumulated
                                                                  Additional         Other                             Total
                                                      Share        Paid-in       Comprehensive      Accumulated     Shareholders'
                                                     Capital       Capital          Income            Deficit          Equity
                                                     -------      ----------     -------------      -----------     -------------
<S>                                                  <C>          <C>            <C>                 <C>            <C>
Balance as of December 31, 2001                       $1,523        $8,531       $    -              $(7,198)          $2,856
Comprehensive income:
   Net (loss)                                              -             -            -                 (118)            (118)
   Foreign currency translation adjustments                -             -           15                    -               15
                                                                                                                       ------
   Comprehensive loss--total                                                                                             (103)
                                                     -------        ------       -------------       ----------        ------
Balance as of December 31, 2002                        1,523         8,531           15               (7,316)           2,753
Comprehensive loss:
   Net income                                              -             -            -                  492              492
   Foreign currency translation adjustments                -             -           12                    -               12
                                                                                                                       ------
   Comprehensive income--total                                                                                            504
                                                     -------        ------       -------------       ----------        ------
Balance as of December 31, 2003                       $1,523        $8,531       $   27              $(6,824)          $3,257
                                                     =======        ======       =============       ==========        ======
</TABLE>


See accompanying notes.




                                       23
<PAGE>

                               Scanvec Amiable Ltd. and Subsidiaries

                               Consolidated Statements of Cash Flows

                                      (Amounts in thousands)
<TABLE>
<CAPTION>
                                                                            Year ended December 31
                                                                              2003          2002
                                                                             -----          -----
<S>                                                                          <C>            <C>
Cash flows from operating activities
Net income (loss)                                                            $ 492          $(118)
Adjustments to reconcile net income (loss) to net cash provided by
  operating activities:
   Depreciation and amortization                                               536            535
   (Loss) on sale of property and equipment                                      -              5
   Gain on sale of S.G.S.                                                        -            (66)
   Changes in operating assets and liabilities:
    (Increase) decrease in accounts receivables                               (137)           262
    (Increase) in other current assets                                         (63)           (84)
     Decrease (increase) in inventories                                         19             (2)
    (Decrease) increase in accounts payable                                   (216)           205
    (Decrease) in accrued expenses                                            (320)          (354)
    (Decrease) in other long-term liabilities                                   (2)             -
                                                                             -----          -----
Net cash provided by operating activities                                      309            383

Cash flows from investing activities
Purchase of property and equipment                                            (147)          (120)
Capitalization of software costs                                              (292)          (285)
Cost of patents and trademarks                                                   -            (22)
Proceeds from sale of stock, net                                                 -            (58)
Long-term receivables from sale of S.G.S.                                       69           (133)
                                                                             -----          -----
Net cash used in investing activities                                         (370)          (618)
</TABLE>





                                                24
<PAGE>

                               Scanvec Amiable Ltd. and Subsidiaries

                         Consolidated Statements of Cash Flows (continued)

                                       (Amounts in thousands)
<TABLE>
<CAPTION>
                                                                             Year ended December 31
                                                                              2003           2002
                                                                             ------         ------
<S>                                                                          <C>            <C>
Cash flows from financing activities
Repayment of capital lease obligations                                       $  (87)        $ (145)
Principal payments on notes payable                                               -            (42)
                                                                             ------         ------
Net cash used in financing activities                                           (87)          (187)

Effect of exchange rate on cash and cash equivalents                             12             70
                                                                             ------         ------
Decrease in cash and cash equivalents                                          (136)          (352)
Cash and cash equivalents at beginning of the year                            1,397          1,749
                                                                             ------         ------
Cash and cash equivalents at end of the year                                 $1,261         $1,397
                                                                             ======         ======

Supplementary disclosure of cash flows activities
Cash paid during the year for interest                                       $   30         $   59
                                                                             ======         ======
Supplementary schedule of non-cash and financing activities
Acquisition of equipment through capital lease obligations                   $   47         $   15
                                                                             ======         ======
</TABLE>


See accompanying notes.








                                                 25
<PAGE>

                      Scanvec Amiable Ltd. and Subsidiaries
                   Notes to Consolidated Financial Statements

                           December 31, 2003 and 2002

            (Amounts in thousands except share and per share amounts)

1. Description of Business

Scanvec Amiable Ltd. and subsidiaries (the Company or Scanvec Ltd.) is an
Israeli corporation. The Company designs, manufactures, markets, and supports a
family of high-performance software products for the sign-making, graphic arts
industries, and for the machining industry. The principal markets of the Company
and its subsidiaries are in North America, Europe, and the Far East. The Company
sells its products primarily to the computer-aided sign industry through a
network of distributors, and also receives fees for the modification of its
existing software.

2. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying consolidated financial statements of the Company include the
accounts of Scanvec Amiable Ltd. and its wholly owned subsidiaries, Scanvec
Amiable Inc.; Scanvec Germany GmbH; and Scanvec Amiable Europe S.A. All
significant inter-company accounts and transactions have been eliminated in
consolidation.

Use of Estimates

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

Translation of Foreign Currency

The local currency is the functional currency for most of the Company's
international subsidiaries, and as such, assets and liabilities are translated
into U.S. dollars at year-end exchange rates. Income and expense items are
translated at average exchange rates during the year. Translation adjustments
resulting from changes in exchange rates are reported in other comprehensive
income. Exchange gains and losses on inter-company balances of a long-term
investment nature are reported in other comprehensive income.



                                       26
<PAGE>



2. Summary of Significant Accounting Policies (continued)

Translation of Foreign Currency (continued)

All other exchange gains and losses on inter-company balances are reported in
other income (expense), net.

Cash and Cash Equivalents

Cash and cash equivalents consist of cash balances and highly liquid investments
with original maturities of three months or less, including time deposits and
certificates of deposit. Included in other current assets is $200 of restricted
cash at December 31, 2003 and at December 31, 2002. The restricted cash
collateralizes the Company's line of credit (Note 9) and such amount is
restricted through December 2004.

Inventory

Inventory primarily consists of supplies used in the production and distribution
of the Company's software, as well as hardware. It is stated at the lower of
cost or market determined on the first-in, first-out (FIFO) basis. Inventory
allowances amounting to $80 at December 31, 2003 are provided to cover risks
arising from slow-moving items or technological obsolescence.

Property and Equipment

Property and equipment are stated at cost, net of accumulated depreciation.
Depreciation is calculated using the straight-line method over the following
estimated useful lives:

           Computers and peripheral equipment         3 to 5 years
           Motor vehicles                             7 years
           Office furniture and equipment             7 to 15 years
           Leasehold improvements                     Over the term of the lease


Intangible Assets

Intangible assets are stated at amortized cost. Amortization is calculated using
the straight-line method over the following estimated useful lives:

        Patents                                                      10 years
        Trademarks                                                    2 years





                                       27
<PAGE>

2. Summary of Significant Accounting Policies (continued)

Capitalized Software Costs

The Company capitalizes software development costs after technological
feasibility of the software is established and through the product's
availability for general release to the Company's customers. Technological
feasibility of the Company's software development costs is determined when the
planning, designing, coding, and testing activities are completed and the
Company has established that the product can be produced to meet its design
specifications. All costs incurred in the research and development of new
software products and costs incurred prior to the establishment of technological
feasibility are expensed as incurred. During the years ended December 31, 2003
and 2002, $292 and $285, respectively, were capitalized as software development
costs in connection with a new product.

Amortization of software development costs is calculated as the greater of the
amount computed using (i) the ratio that current gross revenues for a product
bear to the total of current and anticipated future gross revenues of that
product or (ii) the straight-line method over the remaining estimated economic
life of the product, which is estimated to be two years. Amortization of such
costs commenced in November 2002 and resulted in $46 being charged to operations
in 2002 and $285 in 2003.

Impairment of Long-Lived and Intangible Assets

The Company reviews long-lived assets and intangible assets for impairment
whenever events or changes in business circumstances indicate that the carrying
amount of the assets may not be fully recoverable. If the estimated undiscounted
future cash flows are less than the carrying amounts of the assets, impairment
exists and an impairment loss would be calculated and recorded. An impairment
loss is calculated based on the excess of the carrying amount over the asset's
fair value. Fair value is determined based on current market value or discounted
future cash flows.

The Company estimates the future cash flows expected to result from the use of
its property and equipment. There was no such impairment in 2003 or 2002.

Accounting for Stock-Based Compensation

The Company has a stock-based employee compensation plan, which is described
more fully in Note 10. The Company applies the recognition and measurement
principles of APB Opinion No. 25, Accounting for Stock Issued to Employees, and
related interpretations in accounting for those plans. For stock options, no
compensation expense is reflected in net income as all stock options granted had
an exercise price equal to or greater than the market value of the underlying
common stock on the date of grant. Pro forma information regarding net income







                                       28
<PAGE>

2. Summary of Significant Accounting Policies (continued)

Accounting for Stock-Based Compensation (continued)


and earnings per share is required by Statement of Financial Accounting
Standards ("SFAS") No. 123, Accounting for Stock-Based Compensation, and has
been determined as if the Company had accounted for its stock plans under the
fair value method of SFAS No. 123. For purposes of the pro forma disclosures,
the estimated fair value of the options is amortized to expense over the
options' vesting period.

The following table illustrates the effect on net income (loss) and earnings
(loss) per share if the Company had applied the fair value recognition
provisions of SFAS No. 123.

                                                     December 31
                                                   2003        2002
                                                  -----       ------

         Net income (loss) as reported            $ 492       $ (118)
                                                  =====       ======
         Pro forma net income (loss)              $ 492       $ (142)
                                                  =====       ======
         Pro forma net income (loss) per share--
          basic                                   $0.07       $(0.02)
         Pro forma net income (loss) per share--
          diluted                                 $0.07       $(0.02)
                                                  =====       ======

Revenue Recognition

The Company derives its revenue from license fees and sub-license fees for its
products. The Company sells its products primarily through its distributors and
resellers, both of whom are considered end users. The Company and its
subsidiaries are also entitled to royalties from Original Equipment
Manufacturers (OEM) upon the sub-licensing to end-users.

The Company accounts for software sales in accordance with Statement of Position
97-2, Software Revenue Recognition (SOP 97-2), as amended. Revenues from
licensing software products that do not require significant production,
modification, or customization is recognized when persuasive evidence of an
agreement exists, delivery of the product has occurred, no significant
obligations with regard to implementation remain, the fee is fixed or
determinable, and collectibility is probable.

Revenues from the sale of software products that require customization are
recognized as nonrecurring engineering service fees on the
percentage-of-completion method of accounting using the cost-to-cost method. For
contracts accounted for on the percentage-of-completion basis, revenue and
profit recognized in any given accounting period are based on estimates of total
projected contract costs; the estimates are continually re-evaluated and
revised, when necessary, throughout the life of a contract. Any adjustments to
revenue and profit due to changes in estimates are accounted for in the period
of the change in estimate. When estimates indicate that a loss will be incurred






                                       29
<PAGE>

on a contract upon completion, a provision for the expected loss is recorded in
the period in which the loss becomes evident. Royalties from sub-licensing of
the Company's software are recognized when the sub-licensee's related sales are
completed and reported to the Company. The Company determines such sales by
receiving confirmation of sales subject to royalties from licensees.

The Company does not grant its customers a right of return. However, in
practice, in some cases, sales returns are accepted. The Company's provision for
returns is provided in accordance with SFAS No. 48, Revenue Recognition When
Right of Return Exists, based on the Company's past experience.


Concentrations of Credit Risk

Financial instruments, which potentially subject the Company to concentrations
of credit risk, are primarily cash equivalents, accounts receivables, and other
current assets. The Company places its excess available funds in dollar and
dollar-linked instruments with major banks in Israel, Europe, and the United
States and by policy, seeks to ensure both liquidity and security in principal.
The policy also limits investments to certain types of instruments issued by
institutions with strong investment grade credit ratings and places restrictions
on their terms, geographic origin, and concentrations by type and issuer.

The Company's accounts receivable are unsecured and the Company is at risk to
the extent such amounts become uncollectible. The Company has historically not
experienced significant losses related to individual customers or groups of
customers. Management carefully monitors its client relationships in order to
minimize the Company's credit risk and maintains a reserve for potential
collection losses when such losses are deemed to be probable. The Company
generally does not require collateral and it does not charge finance fees on
outstanding trade receivables. Trade accounts receivable are written off to the
allowance for doubtful accounts when collection appears highly unlikely.

The Company had revenues amounting to 19% of total revenues from two OEMs during
the year ended December 31, 2003. At December 31, 2003, 20% of the Company's
total accounts receivable were due from these OEMs. The Company had revenues
amounting to 35% of total revenues from two OEMs during the year ended December
31, 2002. At December 31, 2002, 24% of the Company's total accounts receivable
were due from these OEMs.









                                       30
<PAGE>


2. Summary of Significant Accounting Policies (continued)

Concentrations of Credit Risk (continued)

The Company has no off-balance-sheet concentration of credit risk such as
foreign exchange contracts, option contracts, or other foreign hedging
arrangements.

Income Taxes

The Company accounts for income taxes under the liability method and,
accordingly, deferred tax assets and liabilities are recognized for the future
tax consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
bases and net operating loss and tax credit carry forwards. Deferred tax assets
and liabilities are measured using enacted tax rates expected to apply to
taxable income in the years in which those temporary differences are expected to
be recovered or settled. The effect on deferred tax assets and liabilities of a
change in tax rates is recognized in operations in the period that includes the
enactment date.

Earnings per Share

Basic earnings per share (EPS) are computed by dividing consolidated net
earnings by the weighted average number of common shares outstanding. Diluted
EPS is computed by dividing consolidated net earnings by the sum of the weighted
average number of common shares outstanding and the weighted average number of
potential common shares outstanding, assuming conversion of all potentially
dilutive stock options outstanding under the Company's share option plan.

Advertising Costs

The Company expenses advertising costs as incurred. Advertising costs expensed
for the years ended December 31, 2003 and 2002 were approximately $336 and $520,
respectively. Approximately $23 of the decrease in advertising costs resulted
from the Company's sale of its 63.8% ownership in Scanvec Garment Systems Ltd.
(SGS), which was effective October 1, 2002.

Fair Value of Financial Instruments

The Company used the following methods and assumptions in preparing its fair
value disclosures for financial instruments: The carrying amounts of cash and
cash equivalents, accounts receivable and accounts payable, reported in the
consolidated balance sheets approximate their fair values due to the short-term
nature of the instruments.








                                       31
<PAGE>

2. Summary of Significant Accounting Policies (continued)


Fair Value of Financial Instruments (continued)

The long-term capital lease obligations reported in the consolidated balance
sheets approximate their fair values due to the fact that their interest rates
approximate market rates of interest.

Shipping and Handling Costs

Shipping and handling costs include all costs to warehouse and deliver inventory
to customers. These costs were $271 and $475 for the years ended December 31,
2003 and 2002, respectively, and are included in costs of revenues.
Approximately $138 of the decrease in shipping and handling costs resulted from
the Company's sale of its 63.8% ownership in Scanvec Garment Systems Ltd. (SGS),
which was effective October 1, 2002.


3. Other Current Assets

Other current assets consist of the following:

                                                      December 31
                                                  2003           2002
                                                  -------------------

           Employee receivables                   $  -           $  9
           Prepaid expenses                        314            102
           Restricted cash                         200            200
           Other                                   133            273
                                                  ----           ----
                                                  $647           $584
                                                  ====           ====











                                       32
<PAGE>



4. Property and Equipment

Property and equipment consists of the following:

                                                          December 31
                                                   2003               2002
                                                  --------------------------

           Computers and peripheral equipment     $ 2,116            $ 2,056
           Office furniture and equipment             673                611
           Leasehold improvements                     162                121
           Motor vehicles                              37                 37
                                                  -------            -------
                                                    2,988              2,825
           Accumulated depreciation                (2,679)            (2,412)
                                                  -------            -------
           Property and equipment, net            $   309            $   413
                                                  =======            =======

Depreciation expense charged to operations was $251 and $399 for the years ended
December 31, 2003 and 2002, respectively. Approximately $22 of the decrease in
depreciation expense resulted from the Company's sale of its 63.8% ownership in
Scanvec Garment Systems Ltd. (SGS), which was effective October 1, 2002.


Property and equipment includes equipment under capital leases, which are
primarily computers (Note 8), for which the net book value was $116 and $159 at
December 31, 2003 and 2002, respectively.


5. Intangibles and Other Assets

Intangibles and other assets consists of the following:

                                                          December 31
                                                    2003              2002
                                                  --------------------------

           Capitalized software costs             $   824            $   532
           Long-term receivable (a)                    64                133
           Trademark                                    8                  8
                                                  -------            -------
                                                      896                673
           Accumulated amortization                  (331)               (46)
                                                  -------            -------
           Intangibles and other assets, net      $   565            $   627
                                                  =======            =======

(a) See Note 14 regarding sale of Scanvec Garment Systems.







                                       33
<PAGE>




5. Intangibles and Other Assets (continued)

Amortization expense was $285 and $136 for the years ended December 31, 2003 and
2002, respectively. The following represents the Company's expected amortization
expense from the intangible assets included in these other assets:


              2004                                         $   359
              2005                                             134


6. Accrued Expenses

Accrued expenses consist of the following:


                                                         December 31
                                                   2003               2002
                                                  -------------------------

           Accrued Royalties                      $  665             $  782
           Accrued Payroll                           320                408
           Accrued Royalties due to government
            authorities (Note 8)                     441                495
           Accrued Legal                              14                213
           Other accrued expenses                    409                271
                                                  ------             ------
                                                  $1,849             $2,169
                                                  ======             ======


7. Related-Party Transactions

The Company paid salaries and related benefits of $182 and $389 during the years
ended December 31, 2003 and 2002, respectively, to shareholders and their
relatives, who are employed by the Company and its subsidiaries.




                                       34
<PAGE>



8. Commitments and Contingencies

The Company leases certain office space under non-cancelable operating leases.
In addition, certain equipment leases are classified as capital leases. The
following is a schedule by year of the future minimum lease payments for leases
with initial terms in excess of one year at December 31, 2003:


                                               Capital Leases  Operating Leases
                                               --------------------------------

          2004                                       86               500
          2005                                       25               487
          2006                                       15                34
          2007                                        -                34
          2008                                        -                34
                                                  -----           -------
          Thereafter                                  -                26
                                                  -----           -------
          Total minimum lease payments              126           $ 1,115
                                                                  =======
          Less amount representing interest         (10)
                                                  -----
          Present value of net minimum
            lease payments                        $ 116
                                                  =====

Rent expense was $535 and $590 for the years ended December 31, 2003 and 2002,
respectively. Approximately $34 of the decrease in rent expense resulted from
the Company's sale of its 63.8% ownership in Scanvec Garment Systems Ltd. (SGS),
which was effective October 1, 2002.

The Company entered into various agreements with the Chief Scientist of the
Government of Israel. The Company has an obligation to pay royalties at the
rates of 3%-5% of the sales of products developed in the framework of the funded
research and development projects. The aggregate royalties payable are 100%-150%
of the grant received, linked to the exchange rate of the U.S. dollar. As of
December 31, 2003, the Company has no obligation to pay royalties on sales
derived from successful research and development projects. The Company is
obligated to repay the Government for the grants received only to the extent
that there are sales of the funded product. Royalties paid or accrued amounted
to $49 and $48 for the years ended December 31, 2003 and 2002, respectively.

The Company is required to pay royalties to the Fund for the Encouragement of
Marketing Activity at the rate of 3% with respect to increase in export sales of
products for which the Company received participation for its marketing
activities. As of December 31, 2003, the Company has an obligation to pay
royalties in the amount of $441.




                                       35
<PAGE>

8. Commitments and Contingencies (continued)

The Company is obligated to repay the Israeli Government for the grants received
only to the extent that there is an increase in export sales from Israel of the
products funded. The Company has ceased sales of the related products and has
moved operations from Israel to the United States and Belgium. The Company
asserts that its obligation is less than the $441 but maintains the liability on
its Balance Sheet until an agreement is reached with the Fund for the
Encouragement of Marketing Activity.

In August 2002, the Company filed a complaint, against several former directors
and employees and the company they formed, in the U.S. District Court for the
Eastern District of Pennsylvania, charging the defendants with misappropriation
of Company intellectual property, misuse of confidential information, violation
of the Lanham Act and several other violations of U.S. law. The defendants
include former directors, Jim Chang and Yuan Chang, who currently own 17.3% and
8.6%, respectively, of the Company's outstanding Ordinary Shares.

The U.S. Federal Court granted a preliminary injunction in December 2002
prohibiting the defendants from continuing their activities worldwide, effective
immediately. The injunction prohibits the defendants from carrying on business
in competition with the Company pending the outcome of a full trial. On October
13, 2003, the United States Court of Appeals for the Third Circuit upheld the
injunction.

The Company has posted a $390 Letter of Credit in accordance with the Court's
directive to provide a security bond (Note 9). The Letter of Credit will remain
in place until the trial and is designated to cover losses incurred by
defendants due to the injunction if they prevail at the trial. The Company seeks
to collect damages and reimbursement of legal expenses as a result of a
successful outcome as well as restrictions on the defendant's future business
practices.

9. Credit Agreements

The Company has a $500 line of credit agreement that expires in December 2004.
As of December 31, 2003, there were no borrowings under this facility.
Borrowings under the agreement bear interest based on the then-current prime
rate of the bank, plus one percentage point. The rate at year-end was 5.0%. The
agreement is secured by $200 in restricted cash, as well as the other assets of
the Company. The credit agreement contains financial and other covenants,
including maintenance of certain financial ratios and a minimum level of net
worth.

Events of default under the credit agreement include failure to perform in
accordance with the covenants, material adverse change, and change of control of
the Company. Under the terms of the credit agreement, all amounts borrowed under
it are immediately due and payable. The Company has issued a $390 letter of
credit against the agreement in connection with the outstanding litigation
described in Note 8 above and in Item 3 of this report. At December 31, 2003,
the Company has met all covenants and conditions under its various lending and
funding agreements.




                                       36
<PAGE>


10. Share Capital

The Company's Ordinary Shares, which have a nominal value of NIS (New Israeli
Shekel) 1.00, are traded on the Over The Counter Bulletin Board market in the
United States. The Ordinary Shares entitle their holders to vote and participate
in meetings, as well as the right to a pro rata share in the Company's profits
and a right to a pro rata share in the excess of assets over liabilities of the
Company in the event of liquidation.

In 1994, 1997, 1998, and 1999, the Board of Directors of the Company adopted
Share Option Plans pursuant to which 300,000; 150,000; 300,000; and 350,000
Ordinary Shares, respectively, were reserved for issuance upon the exercise of
options to be granted to employees of the Company. In October 2000, the Company
established another Share Option Plan, which ratified the 1999 plan.

The exercise price of these options may not be less than 100% of the market
price of the Company's Ordinary Shares on the date of grant. Any options that
are cancelled or forfeited before expiration become available for future grants.
The options granted vest over a 3-year period and expire 10 years after the date
of grant.

Following are the details of such plans:
<TABLE>
<CAPTION>
                                                      Options Outstanding
                                                                                         Weighted
                                                                                          Average
                                     Available           Number         Exercise          Exercise
                                     for Grant         of Options        Price             Price
                                    ------------------------------------------------------------
<S>                                  <C>               <C>              <C>              <C>
     Balance as of
       December 31, 2001              569,900           502,100        $1.00-$6.67         $2.28

     Options forfeited                 51,000           (51,000)        1.38-3.00           1.86
                                      -------           -------        -----------         -----
     Balance as of
       December 31, 2002              620,900           451,100         1.00-6.67          $2.30

     Options forfeited                 25,000           (25,000)          1.38              1.38
                                      -------           -------        -----------         -----
     Balance as of
       December 31, 2003              645,900           426,100       $1.00-$6.67          $2.34
                                      =======           =======       ===========          =====
</TABLE>
The weighted average exercise price of options exercisable as of December 31,
2003 and 2002 is $2.34 and $2.30 respectively.





                                       37
<PAGE>



10. Share Capital (continued)

The options outstanding as of December 31, 2003, have been separated into ranges
of exercise price, as follows:
<TABLE>
<CAPTION>
                                                                                      Weighted Average
                                                                  Weighted            Exercise Price of
                             Options Outstanding and         Average Remaining            Options
      Exercise                  Exercisable as of               Contractual           Outstanding and
       Price                    December 31, 2003               Life (Years)            Exercisable
-----------------------------------------------------------------------------------------------------------
<S>                          <C>                             <C>                      <C>
       $6.67                       30,000                           0.3                    $0.47
        3.63                       20,000                           0.2                     0.17
        3.00                       25,500                           0.3                     0.18
        2.75                       37,600                           0.4                     0.24
        2.63                       30,000                           0.3                     0.19
        2.50                      100,000                           0.9                     0.59
        1.38                       83,000                           1.4                     0.27
        1.00                      100,000                           1.5                     0.23
                                  -------                           ---                    -----
                                  426,100                           5.3                    $2.34
                                  =======                           ===                    =====
</TABLE>

There were no stock options granted during the year ended December 31, 2003.

The Black-Scholes option valuation model was used in estimating the fair value
of traded options that have no vesting restrictions and are fully transferable.
In addition, option valuation models require the input of highly subjective
assumptions, including the expected stock price volatility. Because the
Company's employee share options have characteristics significantly different
from those of traded options, and because changes in the subjective input
assumptions can materially affect the fair value estimate, in management's
opinion, the existing models do not necessarily provide a reliable single
measure of the value of its employee share options.

11. Retirement Plans

Scanvec Amiable Inc., a wholly owned subsidiary, has a defined contribution
retirement plan (401(k) Plan) for the benefit of eligible employees. The plan
provides for matching contributions by Scanvec Amiable Inc. up to a maximum of
30% of 6% of the employee's compensation. Retirement plan expenses for the years
ended December 31, 2003 and 2002 were $42 and $47, respectively.




                                       38
<PAGE>



12. Income Taxes

A reconciliation of the theoretical tax expense (benefit) assuming all income
tax is taxed at the statutory rate and the actual expense (benefit) is as
follows:
<TABLE>
<CAPTION>
                                                                        Year ended December 31
                                                                        2003            2002
                                                                       -----------------------
<S>                                                                    <C>             <C>
Theoretical tax expense (benefit) computed at the                                      $   (36)
statutory rate of 34%                                                  $   175
State taxes (net of federal benefit)                                         -               7
Nondeductible expenses, net                                                 14              14
Carry forward losses for which valuation allowances
  were (reduced) provided                                                 (119)             93
Research & development (credit)                                            (89)              -
Change in federal rate                                                       -             (49)
Foreign taxes rate differential                                             41             (16)
                                                                       -------         -------
Actual tax expense                                                     $    22         $    13
                                                                       =======         =======
</TABLE>

Income (loss) before income taxes consisted of the following:
<TABLE>
<CAPTION>
                                                                        Year ended December 31
                                                                         2003           2002
                                                                       -----------------------
<S>                                                                    <C>             <C>
Domestic                                                               $   592         $   170
Foreign                                                                    (78)           (275)
                                                                       -------         -------
                                                                       $   514         $  (105)
                                                                       =======         =======
</TABLE>

Deferred income tax balances consist of the following:
<TABLE>
<CAPTION>
                                                                             December 31
                                                                        2003            2002
                                                                       -----------------------
<S>                                                                    <C>             <C>
Net operating loss carry forward                                       $ 1,675         $ 1,693
Reserves and allowances                                                    613             626
                                                                       -------         -------
Gross deferred tax assets                                                2,288           2,319
Accumulated amortization of computer software costs
  and property and equipment                                              (278)           (190)
                                                                       -------         -------
Net deferred tax assets before valuation allowance                       2,010           2,129
Valuation allowance                                                     (1,585)         (1,704)
                                                                       -------         -------
Net deferred tax assets                                                $   425         $   425
                                                                       =======         =======
</TABLE>





                                       39
<PAGE>

12. Income Taxes (continued)

Due to a history of losses, the Company has provided valuation allowances
against the deferred tax assets resulting from tax loss carry forwards and other
temporary differences; management currently believes that it is more likely than
not that the deferred taxes related to these items will not be realized.

As of December 31, 2003, the Company has available in the United States net
operating loss carry forwards of $4.2 million expiring between 2015 and 2021. As
of December 31, 2003, Scanvec, Ltd. has available in Israel net operating loss
carry forwards and deductions of $7.2 million, which may be carried forward and
offset against taxable income in the future for an indefinite period.

13. Segments, Customer and Geographic Information

The Company manages its business on a basis of one reportable operational
segment. Total revenues are attributed to geographical areas based on location
of the selling company.

The following presents total revenues and long-lived assets for the years ended
December 31:
<TABLE>
<CAPTION>
                                               2003                       2002
                                     -------------------------------------------------
                                                     Long-                      Long-
                                      Total          Lived       Total          Lived
                                     Revenues        Assets     Revenues        Assets
                                     -------------------------------------------------
       <S>                           <C>             <C>        <C>             <C>
       North America                 $10,226         $1,163     $11,410         $1,242
       Asia                              140             93       1,468            179
       Europe                          3,104             43       2,467             44
                                     -------         ------     -------         ------
                                     $13,470         $1,299     $15,345         $1,465
                                     =======         ======     =======         ======
</TABLE>

Revenues classified by geographical destinations of the end customers:

                                                        Year ended December 31
                                                          2003          2002
                                                        ----------------------

           Israel                                       $   140        $   240
           U.S.A.                                         5,482          6,200
           Far East                                       3,251          4,385
           North America (excluding U.S.A.)                 790            730
           Europe                                         3,807          3,790
                                                        -------        -------
                                                        $13,470        $15,345
                                                        =======        =======






                                       40
<PAGE>

14. Sale of Scanvec Garment Systems (S.G.S)

On October 1, 2002, the Company sold its 63.8% ownership interest in S.G.S. to a
minority shareholder in S.G.S. for $35 in cash and a long-term note receivable
with a minimum value of $180. The net assets of S.G.S. primarily consisted of
acquired plotter technology and other intangibles. The Company recognized a gain
of $66 on the sale in 2002.

No such transaction took place in 2003.

15. Recent Accounting Pronouncements

On January 1, 2003, the company adopted SFAS No. 143, Accounting for Asset
Retirement Obligations, which addresses financial accounting and reporting for
obligations associated with the retirement of tangible long-lived assets and the
associated asset retirement costs. The adoption of SFAS No. 143 did not have any
material impact on the company's financial position or results of operations.

On January 1, 2003, the company adopted Financial Accounting Standards Board
(FASB) Interpretation No. 45, Guarantor's Accounting and Disclosure Requirements
for Guarantors, Including Indirect Guarantees of Indebtedness of Others, which
requires that upon issuance of a guarantee, the guarantor must recognize a
liability for the fair value of the obligation that it assumes under the
guarantee. Guarantors are also required to meet expanded disclosure obligations.
The adoption of Interpretation No. 45 did not have a material impact on the
company's financial position or results of operations.

In January 2003, the FASB issued Interpretation No. 46, Consolidation of
Variable Interest Entities. Interpretation No. 46 addresses consolidation by
business enterprises of variable interest entities, which are entities that
either (a) do not have equity investors with vesting rights or (b) have equity
investors that do not provide sufficient financial resources for the entity to
support its activities. The interpretation is effective immediately for variable
interest entities created after February 1, 2003. In December 2003, the FASB
published FASB Interpretation No. 46 (revised December 2003), Consolidation of
Variable Interest Entities (FIN 46(R)). FIN 46(R), among other things, defers
the effective date of implementation for certain entities. The revised
interpretation is effective for the first interim or annual reporting period
ending after March 15, 2004, with the exception of structures that are commonly
referred to as special-purpose entities, for which the statement is effective
for periods ending after December 15, 2003. The adoption of Interpretation No.
46 is not expected to have a material impact on the company's financial position
or results of operations.

In April 2003, the FASB issued SFAS No. 149, Amendment of Statement No. 133 on
Derivative Instruments and Hedging Activities. This statement amends and
clarifies financial accounting and reporting for derivative instruments,
including certain derivative instruments embedded in other contracts and for
hedging activities under SFAS No. 133. SFAS No. 149 requires that contracts with
comparable characteristics be accounted for similarly. The statement is
effective for contracts entered into or modified after June 30, 2003 and for
hedging relationships designated after June 30, 2003. The provisions of SFAS No.
149 generally are to be applied prospectively only. The adoption of SFAS No. 149
did not have a material impact on the company's financial position or results of
operations.

In May 2003, the FASB issued SFAS No. 150, Accounting for Certain Financial
Instruments with Characteristics of both Liabilities and Equity. SFAS No. 150
establishes standards for classification and measurement by an issuer of certain
financial instruments with characteristics of both liabilities and equity. The
statement requires that an issuer classify a financial instrument that is within
the scope as a liability (or asset in some circumstances). This statement is
effective for financial instruments entered into or modified after May 31, 2003,
and otherwise is effective at the beginning of the first interim period
beginning after June 15, 2003, except as it relates to consolidated limited-life
subsidiaries. The FASB indefinitely deferred the effective date of this
statement as it relates to certain mandatorily redeemable non-controlling
interests in consolidated limited-life subsidiaries. The company does not have
any interest in limited-life entities as of December 31, 2003. The adoption of
the effective provisions of SFAS No. 150 did not have a material impact on the
company's financial position or results of operations.

In December 2003, the FASB issued SFAS No. 132 (revised 2003), Employer's
Disclosures about Pensions and Other Postretirement Benefits. This statement
revises employers' disclosures about pension plans and other postretirement
benefit plans; however it does not change the measurement or recognition of
those plans required by SFAS No. 87, Employers' Accounting for Pensions, SFAS
No. 88, Employers' Accounting for Settlements and Curtailments of Defined
Benefit Pension Plans and for Termination Benefits, and SFAS No. 106, Employers'
Accounting for Postretirement Benefits Other Than Pensions. The revised
statement retains the disclosure requirements contained in the original SFAS No.
132 and requires additional disclosures to those in the original statement about
the assets, obligations, cash flows, and net periodic benefit cost of defined
benefit pension plans and other defined benefit postretirement plans. The
revised statement is effective for fiscal years ending after December 15, 2003.
The adoption of the effective provisions of SFAS No. 132 did not have a material
impact on the company's financial position or results of operations.

                                       41
<PAGE>



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

On December 1, 2003, the Company dismissed Ernst & Young LLP ("E&Y") as its
independent public accountants. The decision to dismiss Ernst & Young LLP was
approved by the Company's Audit Committee and Board of Directors.

On January 12, 2004, the Company retained Grant Thornton LLP ("Grant Thornton")
as its new independent public accountants to perform the audit of the 2003
financial statements. The decision to retain Grant Thornton was approved by the
Company's Audit Committee and Board of Directors as well as its shareholders in
their annual meeting on December 30, 2003.

These events were previously reported on Current Reports on Form 8-K, filed on
December 8, 2003 and January 15, 2004, respectively.






















                                       42
<PAGE>



ITEM 8A. CONTROLS AND PROCEDURES


         Quarterly evaluation of our Disclosure Controls and Internal Controls.
Within the 90 days prior to the date of this Annual Report on Form 10-KSB, we
evaluated the effectiveness of the design and operation of our "disclosure
controls and procedures" ("Disclosure Controls"). This evaluation ("Controls
Evaluation") was done under the supervision and with the participation of
management, including the Chief Executive Officer ("CEO") and Chief Financial
Officer ("CFO").

         Limitations on the Effectiveness of Controls. Our management, including
the CEO and CFO, does not expect that our Disclosure Controls or our "internal
controls and procedures for financial reporting" ("Internal Controls") will
prevent all error and all fraud. A control system, no matter how well conceived,
could provide only reasonable, not absolute, assurance that the objectives of
the control system are met. Further, the design of a control system must reflect
the fact that there are resource constraints, and the benefits of controls must
be considered relative to their costs. Because of the inherent limitations in
all control systems, no evaluation of controls can provide absolute assurance
that all control issues and instances of fraud, if any, within the Company have
been detected. These inherent limitations include the realities that judgments
in decision-making can be faulty, and that breakdowns can occur because of
simple error or mistake. Additionally, controls can be circumvented by the
individual acts of some persons, by collusion of two or more people, or by
management override of the control. The design of any system of controls also is
based in part upon certain assumptions about the likelihood of future events,
and there can be no assurance that any design will succeed in achieving its
stated goals under all potential future conditions; over time, controls may
become inadequate because of changes in conditions, or the degree of compliance
with the policies or procedures may deteriorate. Because of the inherent
limitations in a cost-effective control system, misstatements due to error or
fraud may occur and not be detected.

         Conclusions. Based upon the Controls Evaluation, the CEO and CFO have
concluded that, to the best of their knowledge and subject to the limitations
noted above, the Disclosure Controls are effective to timely alert management to
material information relating to us during the period when our periodic reports
are being prepared.

         In accordance with SEC requirements, the CEO and CFO note that, to the
best of their knowledge, since the date of the Controls Evaluation to the date
of this Annual Report, there have been no significant changes in Internal
Controls or in other factors that could significantly affect Internal Controls,
including any corrective actions with regard to significant deficiencies and
material weaknesses.





                                       43
<PAGE>






ITEM 9.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
<TABLE>
<CAPTION>
Nominee                      Age                                    Principal Occupation
-------                      ---                                    ---------------------
<S>                          <C>           <C>
Benjamin Givli               83            Mr. Givli has served as the Chairman of the Company since June 1998. Mr.
                                           Givli is currently serving as Chairman of OpusDent Ltd. (a subsidiary of
                                           Lumenis Ltd.). Mr. Givli was chairman of the board of directors of Laser
                                           Industries Ltd. from December 1989 until February 1998. He was Chief
                                           Executive Officer of Laser Industries Ltd. from September 1992 through March
                                           1994 and from March 1995 to February 1998. From 1987 to 1989, Mr. Givli was
                                           the chairman of Israel Electric Corporation. From 1970 to 1987, he was
                                           Chairman of Koor Foods Ltd. and a member of the management of Koor Industries
                                           Ltd. From 1987 to February 1995, he was a director of Haifa Chemicals Ltd.

Dr. Ramon Harel              74            Dr. Harel currently serves as CEO of the Company and has been a director of
                                           the Company since its inception in 1990 and served as the Chairman of the
                                           Company from 1990 through the middle of 1998. He also served as President of
                                           the Company from March 2000 until February 2002. He served as Chief Executive
                                           Officer from 1995 to 1997 and as Chief Financial Officer from inception to
                                           1995. Dr. Harel was the Director General of Israel's Transport Ministry from
                                           1969 to 1972 and served as Executive Vice President of the Israel Discount
                                           Bank from 1972 to 1975. From 1978 to 1983, Dr. Harel was the Director General
                                           of the Israel Airports Authority. Dr. Harel holds a Ph.D. in Economics from
                                           Harvard University.

Moti Dabi                    66            Mr. Dabi was elected to the Board of Directors on December 30, 2003 to serve
                                           for a period of one year. Mr. Dabi currently serves as the President and CEO
                                           of Gaon Agro Industries, Ltd. He served as Chairman of Hamashbir Holdings,
                                           Ltd. from 1999 to 2001. Mr. Dabi served as Director General of the Israel
                                           Airport Authority from 1993 to 1997. He held several senior positions within
                                           the Israel Airport Authority from 1978 until 1993. Mr. Dabi holds a B.A. and
                                           M.A. in Political Science from Haifa University.
</TABLE>






                                                           44
<PAGE>


<TABLE>
<CAPTION>
Nominee                      Age                                    Principal Occupation
-------                      ---                                    ---------------------
<S>                          <C>           <C>
Yoav Doppelt                 35            Mr. Doppelt has been a director of the Company since the second quarter of
                                           2000. Mr. Doppelt currently serves as the CEO of Ofer Brothers Hi-Tech Ltd..
                                           Previously, he was the Vice President of Business Development of the
                                           Technological Division of Ofer Brothers Group. Since 1996, Mr. Doppelt has
                                           held various positions in the Ofer Brothers Group such as Investment Manager
                                           and assistant to the CFO. Mr. Doppelt serves as a Director in several
                                           enterprises such as Tower Semiconductor, IMI and Israel Chemicals R&D. Mr.
                                           Doppelt holds a B.Sc. in industrial management from the Technion Institute of
                                           Technology and a MBA from Haifa University.

Shmulik Aran                 42            Mr. Aran has been a director of the Company since December 2002. Mr. Aran is
                                           currently the Chief Technology Officer and Investment Manager for Ofer
                                           Brothers Hitech Investments Ltd. where he has served in this capacity since
                                           2001. From 1998 to 2000, he served as Vice President and Sales Development
                                           Director at Natural Speech Communication. Mr. Aran was the Sales Development
                                           Director and Product and Project Manager at Comverse Network Systems from
                                           1996 to 1997. Mr. Aran has a BSc in Mathematics and Physics from Hebrew
                                           University and an MSc in Electric Engineering from Tel Aviv University.

Aliza Rotbard                56            Ms. Rotbard has been an independent director of the Company since August
                                           1998. Ms. Rotbard is the founder of DOORS Information Systems, Inc. and has
                                           been its Chief Executive Officer since its formation in the US in 1990. From
                                           1985 to 1989, she was President and Chief Executive Officer of Quality
                                           Computers Ltd. From 1980 to 1985, Ms. Rotbard served as Deputy General
                                           Manager, Computer Department and Operations, of the Tel-Aviv Stock Exchange.
                                           Ms. Rotbard holds a BSc. in mathematics and physics from Hebrew University,
                                           Jerusalem.

Avi Heifetz                  60            Mr. Heifetz has been an independent director of the Company since December
                                           2002. Mr. Heifetz is the founder and CEO of A. Heifetz and Co., which he
                                           founded in 1988. The company is an Israeli based investment and financial
                                           management-consulting firm. A. Heifetz and Co. is the managing company of A.
                                           Heifetz Technologies Ltd., an investment company with a portfolio of over
                                           thirty diverse hi-tech companies. Mr. Heifetz served as senior vice president
                                           of Leumi & Co. from 1980 to 1988. Mr. Heifetz was the managing director of
                                           Economics and Planning Department of the Ministry of Transportation in Israel
                                           from 1975 to 1980. Prior to 1975, Mr. Heifetz served as a project manager for
                                           the World Bank and financial consultant to the Israel Discount Bank. Mr.
                                           Heifetz holds a MA in Economics and MBA from Hebrew University.
</TABLE>




                                                           45
<PAGE>
<TABLE>
<CAPTION>
Nominee                      Age                                    Principal Occupation
-------                      ---                                    ---------------------
<S>                          <C>           <C>
Gerald J. Kochanski          50            Mr. Kochanski currently serves as the CFO and Vice President of Finance of
                                           the Company. He has been CFO of the Company since April 2000 and a Vice
                                           President of the Company since January 1999. He was the Chief Financial
                                           Officer of Marketing Technologies, Inc. from 1991 to 1998. From 1988 to 1991,
                                           Mr. Kochanski was the U.S. Corporate Controller of Gist-brocades Food
                                           Ingredients Inc. He is a Certified Public Accountant and holds a MBA with a
                                           Finance concentration and a B.S. in Accounting from LaSalle University in
                                           Philadelphia.

Dan Harel                    36            Mr. Harel currently serves as Vice President Marketing and Business
                                           Development. Mr. Harel rejoined the Company in October 2003, while he
                                           previously served in different roles for Scanvec Amiable, from 1991 to 1996.
                                           From 1997 to 1999, he held the position of Vice President of Operations of
                                           Full Print, a large screen-printing, digital printing and sign-making
                                           manufacturer. From 2000 to 2002, Mr. Harel was the Director of Sales, Western
                                           Region, for Orsus Solutions. Mr. Harel holds a BA in Business Administration
                                           and Accounting from the College of Management in Tel Aviv.
</TABLE>
Audit Committee:
Mr. Avi Heifetz, Ms Aliza Rotbard and Mr. Shmulik Aran serve on the Company's
Audit Committee. The Board of Directors has determined that Mr. Avi Heifetz and
Ms. Aliza Rotbard, qualify as "audit committee financial experts," as defined in
item 401(e) of Regulation S-B. Both of these individuals are independent members
of the Company's Board of Directors.

Code of Ethics:
The Company has not adopted a code of ethics that applies to its Chief Executive
Officer and Chief Financial Officer as of this time. The Company's Board of
Directors is currently in the process of adopting such a code and expects to
complete this process promptly.


Section 16(a) Beneficial Ownership Reporting Compliance

During the last fiscal year, none of the directors, officers or beneficial
owners of more than 10 percent of the Company's Ordinary Shares filed reports
required by Section 16(a) of the Exchange Act.












                                       46
<PAGE>


ITEM 10. EXECUTIVE COMPENSATION
         SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------
                                                   Annual Compensation                Awards             Payouts
                                     ----------------------------------------- ----------------------    -------
            (a)                (b)         (c)          (d)          (e)          (f)         (g)          (h)       (I)
          Name and                                                   Other       Stock     Securities      LTIP       All
          Position            Year       Salary         Bonus     Compensation   Awards    Option/SAR     Payouts    Other
-----------------------------------------------------------------------------------------------------------------------------
<S>                           <C>    <C>             <C>          <C>          <C>         <C>            <C>        <C>
Mr. Benjamin Givli            2003   $      52,478   $      0
Chairman                      2002   $      55,000   $      0
                              2001   $      24,500   $      0

Dr. Ramon Harel (1)(6)        2003   $    150,000    $      0       $23,000(4)
CEO                           2002   $    150,000    $ 30,000       $23,000(4)
                              2001   $    150,000    $      0

Mr. David Daffner (2)(3)      2003   $    100,735    $      0       $1,070 (4)
President                     2002   $    140,000    $ 14,000       $1,170 (4)
                              2001   $          0    $      0

Mr. Gerald Kochanski(3)       2003   $    120,000    $      0       $5,880 (4)
Vice President/CFO            2002   $    120,000    $ 20,000       $5,880 (4)
                              2001   $    112,115    $      0

Mr. Dan Harel (5)(6)          2003   $     23,078    $      0
Vice President Marketing &
Business Development
-----------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1)  Dr. Harel resigned his position as the President of the Company in February
     2002.
(2)  Mr. Daffner served as the Company's President from February 2002 until
     April 2003. His employment was terminated in April 2003 by the Company
     without cause. He was paid five month's salary per his employment
     agreement.
(3)  Messrs. Harel, Daffner and Kochanski received bonuses in 2002. The Company
     does not have a formal Bonus plan. Discretionary bonuses for performance
     may be proposed by the Chief Executive Officer with approval by the Board
     of Directors.
(4)  These amounts represent living and automobile allowances.
(5)  Mr. Harel  became an employee on October 1, 2003.
(6)  Dr. Harel and Mr. Dan Harel are father and son.










                                       47
<PAGE>

Remuneration of Directors
-------------------------

In 2003, the non-employee directors, Aliza Rotbard and Avi Heifetz received a
stipend of $1,000 per quarter and $290 for each Board of Directors or committee
meeting the director attended in person. In addition, the Company reimbursed
non-employee directors for reasonable travel expenses for attending Board of
Directors or committee meetings.

Employment Agreement with Dr. Ramon Harel
-----------------------------------------
On September 5, 2000, Scanvec Amiable, Inc. ("Amiable"), a wholly owned
subsidiary of the Company, entered into an Employment Agreement with Dr. Ramon
Harel. The agreement terminates on December 31, 2001 and was extended to be
terminated on Dec 31, 2002. The term of the agreement specifies that Dr. Harel
will be employed as the President and CEO of Amiable. Under the agreement, Dr.
Harel is entitled to a base salary of $150,000 per year. The Board of Directors
has the discretion to grant Dr. Harel a performance bonus in addition to his
base salary. The contract is terminable by either Dr. Harel or Amiable for any
reason upon 60 days' notice. However, if Amiable terminates Dr. Harel's
employment with the Company without cause, it must pay him his regular salary
during the 60-day notice period and in addition pay him severance equal to three
months' salary. If the Company dismisses Dr. Harel for cause, it will not be
obligated to pay him any severance. The contract also contains provisions
relating to assignment of inventions, non-disclosure of proprietary information
and non-competition and non-solicitation of customers for a period of 12 months
following termination of his employment contract.

Employment Agreement with Gerald J. Kochanski
---------------------------------------------

On October 26, 1999, Amiable Technologies, Inc., the successor to Amiable,
entered into an employment agreement with Gerald J. Kochanski for Mr. Kochanski
to serve as the Vice President of Operations of Amiable Technologies. The term
of the agreement commenced on September 1, 1999 and has no specified termination
date. On April 1, 2000 the Company amended Mr. Kochanski's employment agreement
for Mr. Kochanski to serve as the Chief Financial Officer and the Vice President
of Operations of the Company. Under the agreement, Mr. Kochanski is entitled to
a base salary of $110,000. The CEO has the discretion to grant Mr. Kochanski a
performance bonus subject to the approval of the Board of Directors. The
contract is terminable by either party upon 60 days' notice for any reason, but
the Company must continue to pay him his regular salary during such 60-day
period. However, if the Company terminates Mr. Kochanski's employment with the
Company without notice, for cause, it will not be obligated to pay him his
regular salary during such 60-day period nor any severance. The contract states
that if Mr. Kochanski is forced to leave or changes his position in the Company
due to change in control of the shareholders or restructuring of the Company,
Mr. Kochanski will be entitled to receive three months of severance pay, in
addition to his regular salary during the 60 day notice period. The contract
also contains provisions relating to assignment of inventions, non-disclosure of
proprietary information and non-competition and non-solicitation of customers
for a period of 12 months following termination of his employment contract.







                                       48
<PAGE>

Employment Agreement with  Dan Harel
------------------------------------

On October 6, 2003 the Company entered into an employment agreement with Dan
Harel for Mr. Harel to serve as Vice President Marketing and Business
Development. The term of the agreement commenced on October 1, 2003 and has no
specified termination date. Under the agreement, Mr. Dan Harel is entitled to a
base salary of $100,000 and a commission of 1% of sales in excess of annual
sales of $14 million. The CEO has the discretion to grant Mr. Harel a
performance bonus subject to the approval of the Board of Directors. The
contract is terminable by either party upon 60 days' notice for any reason, but
the Company must continue to pay him his regular salary during such 60-day
period. The Company will pay Mr. Harel two additional months' salary as
severance pay if the Company terminates Mr. Harel's employment without cause.
However, if the Company terminates Mr. Harel's employment with the Company
without notice, for cause, it will not be obligated to pay him his regular
salary during such 60-day period nor any severance. The contract also contains
provisions relating to assignment of inventions, non-disclosure of proprietary
information and non-competition and non-solicitation of customers for a period
of 12 months following termination of his employment contract.


























                                       49
<PAGE>





ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         The following table sets forth, as of November 25, 2003, the number of
Ordinary Shares beneficially owned by (a) all shareholders known to the Company
to own more than 5.0% of the Company's Ordinary Shares, (b) each director and
executive officer of the company, and (c) all directors and executive officers
of the Company as a group.
<TABLE>
<CAPTION>
          Name and Address                         Number of Shares Owned          Percent of Shares (%)
          ----------------                         ----------------------          ---------------------
          <S>                                      <C>                             <C>
          Jim Chang (1)(2)                                1,171,000                       17.3%
          12 Runningbrook
          Irvine, California
          92620

          Dr. Ramon Harel(2)(3)                           1,102,000                       16.3%
          1530 Locust Street
          Philadelphia, Pennsylvania
          19102 (2)

          Yuan Chang (1)(2)                                 585,500                        8.6%
          824 Hunt Rd.
          Newton Square, Pennsylvania
          19073

          Yu-Chung Chu(2)                                   585,500                        8.6%
          11526 Seneca Woods Ct.
          Great Falls, Virginia
          22066

          Yozma Venture Capital Ltd.(4)(5)(6)             1,182,858                       17.5%
          2 Hanamal Street
          Haifa, Israel

          Benjamin Givli (4) (6) (7)                        201,623                        2.9%
          c/o Scanvec Amiable
          Atidim  Industrial Park POB
          58159
          Tel Aviv, Israel(1)(2)
</TABLE>




                                       50
<PAGE>
<TABLE>
          <S>                                      <C>                             <C>
          Yacha Sutton                               171,623                        2.5%
          6 Oppenheimer Street
          Tel Aviv, Israel(1)

          Moti Dabi                                   -0-                             0%
          c/o Scanvec Amiable Ltd.
          Atidim Industrial Park
          POB 58159
          Tel Aviv, Israel

          Shmulik Aran (5)                            -0-                             0%
          c/o Scanvec Amiable Ltd.
          Atidim Industrial Park
          POB 58159
          Tel Aviv, Israel

          Yoav Doppelt (5)                            -0-                             0%
          c/o Scanvec Amiable Ltd.
          Atidim Industrial Park
          POB 58159
          Tel Aviv, Israel

          Avi Heifetz                                 -0-                             0%
          c/o Scanvec Amiable Ltd.
          Atidim Industrial Park
          POB 58159
          Tel Aviv, Israel

          Aliza Rotbard                               -0-                             0%
          c/o Scanvec Amiable Inc.
          International Plaza Two
          Suite 625
          Philadelphia, PA 19113

          Gerald J. Kochanski (7)                     30,000                         .1%
          c/o Scanvec Amiable Inc.
          International Plaza Two
          Suite 625
          Philadelphia, PA 19113(2)

          All directors and executive officers     2,516,481                       37.2%
          as a group (eight persons)
</TABLE>




                                       51
<PAGE>


(1) Messrs. Jim Chang and Yuan Chang are brothers.
(2) Number of ordinary shares owned obtained from Company's Stock Transfer
    Agent.
(3) Number of shares includes vested options to purchase 100,000 ordinary
    shares.
(4) Yozma Venture Capital Ltd., Fertoza LLC (Whitehall Investment Co. and Abbey
    Investment Ltd., subsidiaries of Fertoza LLC, currently hold Fertoza's
    shares) and Messrs. Benjamin Givli and Yacha Sutton (together, the "Givli
    Group"), acquired their shares together from a former principal shareholder
    of the Company in June 1998. The members of the Givli Group have entered
    into an agreement, which, among other things, provides that the parties will
    vote their Ordinary Shares together on all matters coming before the
    Company's shareholders
(5) Yozma Venture Capital Ltd. has a contractual right to nominate two
    representatives to the Company's Board of Directors. Mr. Yoav Doppelt and
    Mr. Shmulik Aran serve on the Company's Board of Directors on behalf of
    Yozma Venture Capital Ltd.
(6) Number of shares confirmed with shareholder.
(7) Number of shares includes vested options to purchase 30,000 ordinary shares.


The table below provides aggregate information relating to the Company's
employee option plans, all of which were approved by the shareholders of the
Company. Additional information concerning such employee option plans is
provided in footnote 12 to the financial statements set forth in Item 7.

<TABLE>
<CAPTION>
 ------------------------------ ------------------------------- ------------------------------- ----------------------------
                                           (a)                             (b)                            (c)

                                                                                                 Number of securities
                                                                                                 remaining available
                                                                                                 for future issuance
                                 Number of securities to         Weighted-average                under equity
                                 be issued upon exercise         exercise price of               compensation plans
                                 of outstanding options,         outstanding options,            (excluding securities
         Plan Category           warrants and rights             warrants and rights             reflected in column (a))
  ------------------------------ ------------------------------- ------------------------------- ----------------------------
  <S>                            <C>                             <C>                             <C>
  Equity compensation            426,100                         $2.34                           645,900
  plans approved by
  security holders
  ------------------------------ ------------------------------- ------------------------------- ----------------------------
  Equity compensation            -0-                             Not applicable                  -0-
  plans not approved by
  security holders
  ------------------------------ ------------------------------- ------------------------------- ----------------------------
  Total                          426,100                         $2.34                           645,900
  ------------------------------ ------------------------------- ------------------------------- ----------------------------
</TABLE>





                                       52
<PAGE>




ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         Dr. Ramon Harel, Chief Executive Officer and Dan Harel, Vice President
         Marketing and Business Development are father and son.






























                                       53
<PAGE>



ITEM 13(a).       Exhibits
<TABLE>
<S>      <C>
  3.1    Certificate of Incorporation (1)
  3.2    Articles of Association (1)
 10.1    Employment Contract of Dr. Ramon Harel, President/CEO dated September 5, 2000 (1)
 10.2    Employment Contract of G.J. Kochanski, Vice President/CFO dated October 26, 1999 (1)
 10.3    Lease for Office of Scanvec Amiable Inc. (formerly Amiable Technologies)
                  with K/B FUND II dated January 27, 1998 (1)
 10.4    Asset Purchase Agreement between Hasmark, Inc., Ivan N. Markowitz, Peter Hasiuk,
                  Scanvec Garment Systems, Ltd. and Scanvec Amiable, Ltd. dated September 1, 2000 (1)
 10.5    Configurable Postscript Interpreter OEM License Agreement between Scanvec Amiable Inc.
                  (formerly Amiable Technologies Inc.) and Adobe Systems Incorporated dated
                  February 7, 1997 (1)
 10.6    Appendix No. 1 to the Adobe Agreement dated February 7, 1997 (1)
 10.7    Appendix No. 2 to the Adobe Agreement dated February 7, 1997 (1)
 10.8    Amendment No. 1, dated March 15, 1998, to Appendix No. 1 to the Adobe Agreement.(1)
 10.9    Amendment No.2, dated March 15, 1999, to Appendix No. 1 to the Adobe Agreement.(1)
10.10    Letter extending Adobe agreement from February 7, 1999 to February 7, 2000 (1)
10.11    Letter extending Adobe agreement from February 7, 2000 to February 7, 2001 (1)
10.12    Letter extending Adobe agreement from February 7, 2001 to February 7, 2002 (1)
10.13    Amendment No. 3, dated February 26, 2001, to Appendix No. 1 to the Adobe Agreement.(1)
10.14    Agreement to Develop OEM Products for ColorCAMM PC600 between Scanvec Amiable Inc.
                  (formerly Amiable Technologies Inc.) and Roland DG Corporation dated May 14, 1999 (1)
10.15    OEM Agreement with Great Computer Corporation and Scanvec Amiable Inc.
                  (formerly Amiable Technologies Inc.) dated March 10, 2000 (1)
10.16    Distributor Agreement between Scanvec Amiable Inc (formerly Amiable Technologies Inc.)
                  and Mutoh Industries, Ltd. dated June 15, 2000 (1)
10.17    Agreement to Develop OEM Products between Scanvec Amiable Inc (formerly Amiable
                  Technologies Inc.) and Alps Electric Co., Ltd. dated March 31, 2000 (1)
10.18    OEM Software Development and License Agreement between Hewlett Packard Company
                  and Scanvec Amiable Inc. dated March 1, 2000 (1)
10.19    OEM Software Development and License Agreement between Hewlett Packard Company
                  and Scanvec Amiable Inc. dated September 1, 2000 (1)
10.20    Agreement to Develop OEM Products between Scanvec Amiable Inc. (formerly Amiable
                  Technologies Inc.) and Mimaki Engineering Co., Ltd. dated July 10, 1999
                  and Addendum #1 dated October 12, 2000 (1)
10.21    Agreement to Develop OEM Products between Scanvec Amiable Inc, (formerly Amiable
                  Technologies Inc.) and Roland DG Corporation dated April 20, 1998 with
                  Addendums #1 and #2 dated April 3, 2000 (1)
14.1     Code of Ethics
21.1     Subsidiaries of the registrant
24.1     Form of Power of Attorney
</TABLE>





                                       54
<PAGE>

ITEM 13(a).       Exhibits (continued)
<TABLE>
<S>      <C>
31.1     Certification of Principal Executive Officer pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002
31.2     Certification of Principal Financial Officer pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002
32.1     Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to
                  Section 906 of the Sarbanes-Oxley Act of 2002
32.2     Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to
                  Section 906 of the Sarbanes-Oxley Act of 2002
</TABLE>

(1) Incorporated by reference to Scanvec Amiable Ltd.'s Form 10-KSB for the
year ended December 31, 2000, filed with the Commission on April 17, 2001.

































                                       55
<PAGE>



ITEM 13(b).       Reports on Form 8-K.

Reports on Form 8-K.

During the last quarter of the period covered by this report, the following
reports on Form 8-K were filed:

December 8, 2003, Form 8-K reporting under "Item 4. Changes in Registrant's
Certifying Accountant" disclosing the dismissal of Ernst & Young LLP as the
Company's independent public accountants and the appointment of Grant Thornton
LLP as the Company's new independent public accountants.

December 12, 2003, Form 8-K/A reporting under "Item 4. Changes in Registrant's
Certifying Accountant" correcting the information included in the December 8,
2003 Form 8-K with regard to Grant Thornton LLP to disclose that the appointment
of Grant Thornton LLP is subject to completion of their engagement acceptance
process.



































                                       56
<PAGE>



ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES


Audit Fees
----------
These are the aggregate fees billed for professional services by the Company's
independent accountants for the audit of the annual financial statements and
quarterly review of financial statements included in the Company's Form
10-QSB(s) as well as services provided in connection with statutory or
regulatory filings.

         2002              $138,000
         2003              $139,000

Audit-Related Fees
------------------
These are the aggregate fees billed for professional services by the Company's
independent accountants for assurance and related services that are reasonably
related to the performance of the audit of the Company's financial statements
and are not reported under Audit Fees.

         2002              $ 0
         2003              $ 0

Tax Fees
--------
These are the aggregate fees billed for professional services by the Company's
independent accountants for tax compliance, tax advice and tax planning.

         2002              $ 55,000
         2003              $ 34,000

All Other Fees
--------------
These are the aggregate fees billed for products and services by the Company's
independent accountants and are not reported in any of the other categories in
this section.

         2002              $ 0
         2003              $ 0


The Company's Audit Committee pre-approved the 2003 Audit Fees in accordance
with Rule2-01 of Regulation S-X. The 2002 Audit Fees and Tax Fees for 2002 and
2003 were not pre-approved by the Company's Audit Committee since the work was
performed prior to the current requirements prescribed by Rule2-01 of Regulation
S-X.



                                       57
<PAGE>

                                   SIGNATURES


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




                                  Scanvec Amiable, Ltd.

                                  By: /s/ Dr. Ramon Harel
                                      -------------------------------
                                  Dr. Ramon Harel, Chief Executive Officer



                                  /s/ Dr. Ramon Harel
                                  ---------------------
                                  Dr. Ramon Harel on behalf of himself as
                                  Chief Executive Officer and Director,
                                  and as attorney-in-fact for Aliza
                                  Rotbard, Moti Dabi, Benjamin S. Givli,
                                  Shmulik Aran, Avi Heifetz and Yoav
                                  Doppelt, Directors



                                  /s/ Gerald J. Kochanski
                                  ----------------------------------------
                                  Gerald J. Kochanski, Chief Financial Officer
















                                       58
<PAGE>



                                  Exhibit Index

Exhibit Number                     Description
--------------------------------------------------------------------------------
    21.1          Subsidiaries of the registrant
    24.2          Form of Power of Attorney
    31.1          Certification of Principal Executive Officer pursuant to
                       Section 302(a) of the Sarbanes-Oxley Act of 2002
    31.2          Certification of Principal Financial Officer pursuant to
                       Section 302(a) of the Sarbanes-Oxley Act of 2002
    32.1          Certification of Principal Executive Officer pursuant to
                       18 U.S.C. Section 1350 as adopted pursuant to Section 906
                       of the Sarbanes-Oxley Act of 2002
    32.2          Certification of Principal Financial Officer pursuant to
                       18 U.S.C. Section 1350 as adopted pursuant to Section 906
                       of the Sarbanes-Oxley Act of 2002
























                                       59