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

                                   FORM 10-KSB

(X)   ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE  SECURITIES EXCHANGE
      ACT OF 1934 For the fiscal year ended December 31, 1997.


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

               For the transition period from _______ to ________.

Commission File No.:  0-29098


                                  NAVIDEC, INC.
         ---------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)

         COLORADO                                         33-0502730
     (State or other                                    (IRS Employer
     jurisdiction of                                  Identification No.)
      incorporation)

              14 INVERNESS DRIVE, SUITE F-116, ENGLEWOOD, CO 80112
              ----------------------------------------------------
               (Address of principal executive offices) (Zip Code)

            Issuer's telephone number, incl. area code: 303-790-7565


Securities registered pursuant to Section 12(b) of the Act:
     None

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

     COMMON STOCK NO PAR VALUE
     Title of Class

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports),  and (2) has been
subject to such filing requirements for the past 90 days. Yes ( ) No (X)

Check if there is no disclosure of delinquent  filers in response to Item 405 of
Regulation  S-B is not  contained  in  this  form,  and no  disclosure  will  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. (X)

Revenues for the issuer's most recent fiscal year ended  December 31, 1997,  are
$6,008,000.

As of March 24,  1998,  there were  3,245,298  shares of Common Stock issued and
outstanding and the aggregate market value of the issued and outstanding  Common
Stock held by non-affiliates was approximately $10,900,000

<PAGE>

PART I

ITEM 1. DESCRIPTION OF BUSINESS

OVERVIEW

Navidec, Inc.(the "Company"),  based in Englewood,  Colo., is a leading provider
of  products  and  solutions  that use  Web-based  technologies  to achieve  its
customers'  business  objectives.  From  commercial Web site  development to the
design and  implementation of intranet and extranet  applications and tools, the
Company helps customers nationwide define,  develop and deploy successful online
solutions.  The Company  provides its services and  distributes  its products to
over 700  customers as of the date of this report.  The Company also serves as a
distributor of various high  technology and other products  through  traditional
and electronic channels.

The Company's core competencies in Internet/Intranet  technology and traditional
product marketing and distribution form its business model of providing complete
Internet/Intranet  Solutions.  These  solutions  include  computer  and  network
infrastructure  equipment,  software  and  services,  content  and  aggregation,
electronic  commerce and fulfillment of orders. The Company was organized as ACI
Systems,  Inc. in July 1993 and changed its name to NAVIDEC,  Inc. in July 1996.
The  Company's  principal  sources  of revenue  are from the resale of  computer
equipment, high technology peripherals and electronic components manufactured by
independent   vendors  (  Product   Distribution  )  and  services   related  to
Internet/Intranet  Solutions and license fees from  recurring  lead revenue from
the Wheels solution. The Company merged with Interactive Planet, Inc. ("IPI"), a
designer  and  developer  of Internet  World Wide Web sites,  in July 1996.  The
Company   issued  an  aggregate  of  678,877  shares  of  Common  Stock  to  the
shareholders  of IPI and a  promissory  note in the  amount  of  $75,000  to one
shareholder  of IPI in exchange for all of the issued and  outstanding  stock of
IPI. The Company acquired TouchSource,  Inc. ("TS"), a designer and developer of
interactive  Kiosks,  in July 1997.  The Company  issued an aggregate of 207,000
shares of Common  Stock to the  shareholders  of TS and TS was  merged  into the
Company  in  exchange  for all of the issued  and  outstanding  stock of TS. The
merger  and  acquisition  were  consummated  in order to  expand  the  Company's
business model of combined  expertise in traditional  marketing and distribution
and Internet/ Intranet technology.


Business Strategy

The  Company's  goal  is to  enhance  its  position  as a  leading  provider  of
comprehensive  networking and electronic marketing and distribution solutions to
regional,  national and international  clients.  To achieve this objective,  the
Company is pursuing the following strategies.


Leverage Expertise and Core Competencies


The Company  leverages its  expertise in two core  businesses,  high  technology
product distribution and Internet/Intranet  Solutions,  into complete electronic
marketing and networking solutions. The Company's solutions span all segments of
the commercial Internet industry,  including  networking  equipment and routers,
Internet software, Internet/Intranet design and implementation, content creation
and aggregation,  and promotion.  Management believes that the Company's ability
to offer this full range of  Internet/Intranet  products and services as well as
traditional distribution and marketing services is unique in its industry.


Exploit Recurring Revenue Streams

The  Company  emphasizes  ongoing  services to its  Internet/Intranet  Solutions
clients,  which services are a source of recurring revenues often well in excess
of the fees associated with initial Web site development.  The Company's primary
focus has been on its Wheels  solution.  Wheels which was  introduced in the 4th
quarter of  1997,provides  recurring  revenues from lead fees paid by Automotive
Dealers,  and hosting and maintenance  fees paid by its Media partner  (regional
news paper, television or radio station).

<PAGE>


Develop Strategic Relationships

The Company has developed technology,  marketing and distribution  relationships
with a number of leading companies.  Important  relationships include those with
Banc One, AT&T,  Silicon  Graphics,  Sybase,  and Netscape.  Wheels is currently
under  contract  in Denver  Colorado,  and in  Portland  Oregon.  The Company is
currently  deploying its Wheels solution through a strategic  relationship  with
Banc One  Credit  Company  which has  committed  to  launching  four  additional
regional Wheels sites. Banc One Credit has offices in 48 states. Banc One Credit
Company is a subsidiary of Banc One Corporation headquartered in Columbus, Ohio.
It is one of the largest finance companies in the United States and is a holding
company of eight units. Banc One chose the Company's "Wheels" solution after two
years of  reviewing  other  automotive  solutions.  The choice of the  Company's
solution was based on its  abilities  to sell cars for  dealers,  and Banc One's
belief that Wheels could increase its indirect  automotive  lending. As a result
of the  Company's  technical  expertise,  it has been  designated  as a Netscape
Commercial  Applications Products Provider Partner (NCAPP),  which is Netscape's
top reseller designation and which allows the Company to offer all of Netscape's
high-end commercial  Internet software products to its clients.  These and other
strategic  relationships  have fueled much of the recent  growth of the Company,
and  management  expects  them to continue to  generate  additional  clients and
revenue. Management believes that the primary growth that will be experienced in
1998 will come from its  Wheels  solution.  The  Wheels  solution  provides  the
Company  revenue from one times fees and recurring  monthly  fees.  The one time
fees come from license fees for each region,  one time setup fees from  dealers,
and  training  fees.  Recurring  fees come from  customer  lead and lookup fees,
monthly fees which come from dealers and monthly fees charged to regional  media
partners.


Emphasize Client Return on Investment.

The Company  furnishes  clients with  solutions  which are designed to provide a
return on their investment through generation of leads, increased sales, reduced
personnel  expenses and/or  improved  communications  within their company.  The
Company also intends to emphasize  hardware  solutions such as on - and off-site
free standing kiosks which include a computer  terminal linked to the Wheels Web
site of the client.  These  kiosks are  designed to expand the  audience for the
client's electronic marketing presence.

Promote Intranets

The Company  believes  that many  companies can benefit from the ease of use and
familiarity of a Web-style interface for their internal networks.  Intranets can
provide an open,  non-proprietary  enterprise interface to a closed, proprietary
legacy database  system,  thereby avoiding the need to replace the entire legacy
system  when an  updated  enterprise  interface  is  desired.  The  Company  has
implemented a major Intranet  system for KN Energy and Merrick  Engineering  and
intends to promote its  expertise in this area to other large  companies  with a
need for an easy to use internal network interface.


Expand Traditional Distribution Channels

To date,  distribution  of high  technology  products  and related  services has
accounted for the  substantial  majority of the Company's  revenue.  The Company
intends to expand its high technology product  distribution  business by through
solution  selling,  which will combine the Company's  software  development  and
hardware sales. The Company also plans to implement and promote its own Internet
Web site for direct sales of high technology products.

<PAGE>



INTERNET/INTRANET SOLUTIONS

Internet/Intranet Industry Overview

The Internet is a network of computer  networks that are both  commercially  and
publicly owned. The networks all use a common set of  nonproprietary  networking
protocols.  This commonality of protocols  provides what appears to the Internet
user  to  be  a  seamless,   integrated  virtual  network   notwithstanding  the
heterogeneity of the computer hardware and communications systems underlying the
Internet. Although the individual networks comprising the Internet are privately
owned, no one organization  owns or controls the Internet.  Any network may join
or remove  itself from the Internet at any time and this open access has allowed
the  Internet  to grow  exponentially  as a resource  in the  United  States and
world-wide.  Each new  network  (or  individual  connecting  through a  network)
becomes not only a consumer of information  available on the Internet but also a
potential  information  or  content  provider  to other  users of the  Internet.
Internet  networks are connected in a variety of ways,  including regular analog
phone  lines,  high-speed  digital  lines and fiber optic  links.  The  Internet
permits  users to  communicate  electronically,  share or  publish  information,
download  software and  participate  in commercial  transactions.  Internet data
packets are transferred  through flexible routing  protocols which allow signals
to reach their  destinations  even though portions of the network may be down or
overburdened.  Nonetheless,  because  of  the  rapidly  growing  traffic  on the
Internet,  users sometimes report  significant  delays in data transfer and some
loss of data.  There is a risk that as the  Internet  grows in  popularity,  its
infrastructure  will become  overwhelmed to the point where its functionality is
impaired,  perhaps  significantly.  Because connecting  directly to the Internet
requires expensive equipment and considerable technical expertise, most Internet
users connect to the Internet  through one of a rapidly  growing number of local
and national  Internet  Service  Providers  (ISPs),  including the major on-line
services such as America Online and CompuServe.  The Company is not one of these
ISPs.

The World Wide Web

Much of the recent growth in Internet use has been  attributable to a network of
servers and  information  available via open  protocols  known as the World Wide
Web.  The  Web can be  accessed  through  software  programs  such  as  Netscape
Navigator and Microsoft Explorer, which allow non-technical users to exploit the
capabilities of the Internet.  The Web enables users to find,  retrieve and link
to multimedia  content on the Internet  with easy to use  graphical  interfaces.
Electronic  documents  are  published on Web servers in a common  format  called
hypertext  markup  language  (HTML).  Web software  browsers can retrieve  these
documents   across  the   Internet  by  making   requests   through  a  standard
communications protocol called Uniform Resource Locators, or URLs.

The technical capabilities of the Web together with the increasing  availability
of  user-friendly  navigational  and utility  tools and search  engines  such as
Yahoo, Excite, Webcrawler, Magellan and Alta Vista are responsible for the rapid
growth in the  popularity of the Web as a distribution  channel.  In March 1997,
International Data Corporation estimated the number of
commercial  sites on the World Wide Web is doubling every six months and came to
more than 45,000 in 1996 and predicted  that the number of business  sties would
reach 100,000 by 2000.

The term Web site is commonly used to describe the computer  screen  layouts and
the file server computer that are accessible by users of the Web.  Typically,  a
Web site has a  collection  of Web  pages  which  may  contain  text,  graphics,
pictures,  sound,  animation,  video or other multimedia content.  One important
feature of the HTML format is that it allows a Web user to travel to other sites
simply by  selecting  with a mouse or other  pointing  device a text or  graphic
marker  on the  current  Web  page.  In  this  manner,  users  can  quickly  and
effortlessly  connect  to Web pages that are part of the same Web site or to Web
pages located on servers in another  continent.  Web sites vary significantly in
their  complexity  and  interactivity.  A simple  Web site may have only text in
outline form. More complex sites may have full multimedia content. Web sites may
also vary in their level of interactivity  with the user. Many Web sites are for
inquiry only  (informational),  while  others  allow the user to interact  with,
enter and process information (interactive).

<PAGE>


Commercial Uses of the Internet

Commercial   uses   of   the   Internet   include    business-to-business    and
business-to-consumer     transactions,     product    marketing,    advertising,
entertainment,  electronic publishing, electronic services and Internet support.
The  Company  views  the  Internet  and in  particular  the  Web  as  presenting
significant  opportunities  for electronic  marketing,  sale and distribution of
products.  In the Company's view, the Internet's benefits include:

-    Low cost in comparison to other  marketing  channels
-    Direct marketing of products and services
-    Audio/visual display and demonstration of products
-    Ability to capture orders  electronically at significantly  lower personnel
     costs than traditional order-taking
-    Provision of client  services such as order  tracking and  trouble-shooting
     Immediate  fulfillment and satisfaction of certain orders, such as software
     and information deliverable electronically
-    Customer convenience (24-hour, 7 days a week access)
-    Potential for narrowly-targeted marketing

A number of  companies  have  developed  systems to  maintain  the  security  of
transactions  on the Internet and the Company has developed its own  proprietary
merchandise engine which provides security for order-taking functions. There can
however be no assurance that breaches in  transaction  security will not have an
adverse effect on the growth and viability of on-line commerce.

Intranets

Because of the ease of use and widespread acceptance of Internet protocols, HTML
and other scripting  languages and tools, a number of companies have implemented
internal  networks,  or  Intranets,  based on such  protocols.  The use of these
protocols allows employees using personal  computers and Web browser software to
access and  interact  with a broad range of  information  sources  within  their
company,  independent of physical location and underlying  computer and database
design, on the familiar platform of Web browser software.

The Company's Internet/Intranet Solutions

The Company provides its Internet/Intranet Solutions through six business units:
Business  Development  Services,  World Wide Web Services,  Marketing  Services,
Media Services,  Client Services and Channel Services. These units function as a
team  in  providing  solutions  for  clients.  The  Internet/Intranet  Solutions
provided  to  clients  often  also  involve  one  or  more  of  the  traditional
distribution services offered by the Company.

Business  Development  Services are delivered  through  consulting  engagements,
generally  billed on an hourly  basis,  in which Company  professionals  analyze
client  business  requirements  and  recommend  comprehensive  solutions for the
client's Internet or Intranet  requirements.  Proposed  solutions offered by the
Company include one or more of the following components:

-    Network solutions
-    Web site specifications
-    Private  Intranets - Web distribution strategies
-    Traditional channel strategies
-    Integrated marketing
-    Image development
-    Product introduction
-    Project management
-    Graphic design
-    Product distribution

<PAGE>


World Wide Web  Services  provide  the design and  implementation  of a Web site
based upon specifications developed by the Company and the client. The Company's
World Wide Web Services  also include the design and  implementation  of private
Intranets, including hardware and software implementation.

The Company  designs  many of its Web sites with  database  system  integration,
which  allows the Web site to act as an  interface  to selected  portions of the
client's internal legacy or enterprise systems.  Such integration allows the Web
site to reflect continuously the most current information concerning the client.

The Company has developed a set of proprietary software tools for implementation
on  client  Web  sites.  These  tools are  licensed  to  clients  for use on the
particular  site for so long as the site is maintained  by the Company.  A brief
description of each of the Company's proprietary tools follows.

Wheels

Wheels:  Navidec's Online Automotive Solution

Wheels provides the first comprehensive regional automotive Internet solution to
the television and newspaper publishing industries.  Wheels addresses the online
sales needs of media  organizations,  automotive  dealers and  consumers  in the
following ways:

Media

With the  growing  impact  of  online  media on  traditional  media,  television
stations and newspapers are looking to secure revenue from online activities and
gain a competitive advantage in their markets. Wheels offers media organizations
a new online revenue stream from their existing dealer advertiser relationships,
and proactively positions media organizations with these important advertisers.

Automotive Dealers

Wheels  offers  dealers a total online  automotive  solution that allows them to
integrate their complete new and pre-owned  inventory  across dealer  franchises
and multiple  legacy systems  automatically  updating that inventory on the Web,
touch-screen  kiosks and mobile  sales  laptops.  This  solution  complements  a
dealer's existing  traditional media advertising  strategy and is proven to help
them sell more vehicles.

Consumers

Consumers  can use Wheels to search both new and pre-owned  car  inventories  of
dealers in their region, view digital photographs and maintain personal interest
lists.  Wheels allows  consumers to search multiple dealer  inventories by make,
model,  year, price range and mileage.  It also allows consumers to request that
dealers assist them in their search for a specific vehicle.

Market opportunity

Navidec believes the market opportunity for Wheels is extremely  promising.  The
massive  automotive  market has quickly been impacted by Internet  technology as
consumers have adopted the Internet as an important  tool for making  automotive
purchase decisions. The Internet allows consumers to collect the large amount of
information necessary to choose an auto from the comfort and convenience of home
or work.  According to Toyota,  Internet  auto  shoppers buy within two to three
days of visiting a  dealership.  Prior to the  Internet,  consumers  bought only
after two to three weeks of  shopping.  Following  are  statistics  about online
buying and its potential impact on the automotive industry:

<PAGE>


Online Auto Buying

-    63 percent of all respondents to a recent study  would use the  Internet to
     obtain  information  about the vehicles they are  considering for purchase.
     The Dohring Co.

-    2.5  million people shopped for cars or parts over the Internet in the last
     half of 1996. CommerceNet/Nielson Media

-    Chrysler  believes  that 25 percent of its vehicle sales will happen online
     within four years. The Economist, March 8, 1997.

Automotive Market

-    The automotive market in the U.S.  generates in excess of $600 billion each
     year.

-    Auto dealers spend  approximately  $300 in advertising to sell each vehicle
     in their inventory. Reynolds & Reynolds

-    Wheels significantly lowers cost of sales for each participating dealer.


Growth potential of Wheels

Navidec  is  well-positioned  to  experience  significant  growth  from  Wheels.
Colorado Wheels,  Navidec's first Wheels implementation has far exceeded initial
expectations for participating  dealers,  customer leads and auto sales, as well
as for  consumer  acceptance.  In December  1997,  ColoradoWheels  included  the
inventory of 35 separate  dealer  franchises  in Denver and generated 84 percent
more leads to those dealers than  anticipated.  Navidec's  resulting revenue was
also 97 percent higher than budgeted.


Navidec  continues  to  license  Wheels  to media  partners  in the top  markets
nationwide and is currently  negotiating  final contracts in five major markets.
Navidec  currently  expects to license Wheels in 12 markets in 1998, and expects
to license up to 65 markets within 36 months.

Competitive positioning

Navidec's  Wheels has several  features  that make it unique in the  marketplace
today.  First, it is a regional solution.  Traditionally  consumers have shopped
for autos within five to 10 miles of their home,  and Navidec's  experience  has
shown that the Internet does not change a shopper's desire to purchase a vehicle
from a near by dealer.  Consumers  use the Internet as a tool to make a purchase
decision and generally want to see and drive the vehicle they are interested in.
Second,  Wheels was the first online automotive sales solution to be licensed to
media partners.  Wheels provides the sponsoring  media with a method to generate
ongoing  revenue from new media and secure a  competitive  position in a market.
Media  partnerships  ensure  that  Wheels is heavily  promoted  in each  market.
Navidec does not pay the advertising  costs to draw consumers to the Wheels site
in each market--all promotion is provided by its media partner.

Market Entry

Navidec  developed the software  framework of Wheels based on its experience and
the proven  solution it created for the Burt  Automotive  Group in Denver.  Burt
sells  more  than  46,000  automobiles  each year and its 1996  sales  were $813
million. Burt sells 100 cars each month from the Internet. Navidec's development
of Burt's online  solution  allowed Navidec to use its development for Burt as a
research  and  development  tool for  Wheels.  Wheels has now been  launched  in
Colorado with all of the functionality  required for future markets.  Wheels can
literally  be  launched  in  additional   markets  within  days,   limiting  the
time-to-market  issues that have traditionally  plagued software  launches.  The
ability to easily  roll out  markets  also  ensures  that  Navidec can enter new
markets quickly prior to other solutions.

<PAGE>


Products provided by Navidec to the auto industry

Navidec  provides the total online  automotive  solution that includes  regional
Wheels Web sites,  individual dealer Web sites,  touch-screen kiosks, and mobile
sales laptops. These tools use the same vehicle management technology to present
a dealer's  inventory  through  multiple  points of presence.  Once the dealer's
inventory is available on Wheels,  it can easily be channeled into unique dealer
websites,  kiosks or laptops.  The kiosks provide  dealers or Wheels partners an
avenue to reach  non-Internet users and consumers in high traffic locations such
as banks and malls. The mobile sales laptops create a portable inventory manager
for a dealer to take to fleet  sales  calls or trade  shows.  Both are  powerful
tools to leverage Wheels participation and drive more new vehicle sales.


Potential applications in other vertical markets

Wheels is an inventory  management  system and its framework could be adapted to
manage and sell a vast array of inventory  over the Web.  Though Navidec has not
begun selling its technology  into other vertical  markets,  it is examining its
potential applications.


Navidex

The Navidex tool is a dynamic, database driven table of contents that allows the
user to intuitively navigate the Web site.


Navimap

The Navimap tool is a graphical representation of site information with links to
other areas on the site.


Merchandise Engine

The Merchandise Engine creates an on-line catalog of products available for sale
through the Web site. The  Merchandise  Engine also contains a secure  algorithm
for transmitting credit card information and is capable of capturing contact and
marketing information from customers placing orders.


Calendar Tool

The Calendar Tool provides a visual  interface for searching  through a database
of date oriented activities, announcements, meetings or other events.


E-Mail Tool

The E-Mail Tool is an e-mail  engine which allows e-mail to be sent from the Web
site to e-mail addresses  designated by the client for purposes such as customer
feedback, customer information capture and customer service inquiries.

Administration Tools

Administration Tools provide clients with the means to maintain and update their
sites themselves.

<PAGE>


Creative Services

Creative  Services include digital image capture,  post-processing  services for
scanned images and graphic arts production. The Company offers these services to
assist clients in developing a uniform company image that spans both traditional
and electronic  media.  Actual output  services  provided by the Company include
photographic  quality  prints,  color  transparencies  and printed output in all
sizes. The Company typically bills Creative Services on a project basis.


Client Services

Client Services include  technical  support,  network  implementation,  Web site
maintenance and evolution,  hosting of Web sites on a Company  Internet  server,
database management,  product support and electronic  messaging  implementation.
The  Company  charges  a  variety  of fees for these  services,  ranging  from a
specific one time fee for change requests to a monthly fee for site maintenance.


Channel Services

Channel Services include all of the functions necessary to implement an Internet
marketing  and  distribution  plan,  including  on-line  sales  of  merchandise,
warehousing and order  fulfillment.  The Company  generates  revenues from these
services  principally  through sales  commissions  which vary depending upon the
level of Company involvement in the distribution plan.


Significant Clients

The Company's major Internet/Intranet Solutions clients include the following:

Account:            Colorado Wheels by The Denver Post / Navidec

Industry:           Retail Automobile Market

Description:        Navidec  developed  Colorado  Wheels to allow  consumers  to
                    search for new and pre-owned  cars from the  inventories  of
                    multiple auto dealers in the local Denver metropolitan area.

                    Navidec's vision was to develop a system that would generate
                    sales leads to enable automobile  dealers to sell cars using
                    the  Internet  as a new  distribution  channel.  The  vision
                    includes   working   with  media   partners   within   local
                    metropolitan  markets who create  awareness  of the Web site
                    through advertising.  Bank One is Navidec's national partner
                    to produce Wheels in markets nationwide.

                    The   first   regional   Wheels   site,   Colorado   Wheels,
                    coloradowheels.com,  was  unveiled  in  late  1997,  and  is
                    promoted by The Denver Post.  Northwest Wheels was announced
                    in February 1998, and will be promoted by  KOIN-Channel 6, a
                    CBS  affiliate,   to  consumers  in  Portland  and  southern
                    Washington.

                    Shoppers  who access  the site can search for autos  using a
                    variety of criteria,  including make, model, year and price.
                    The site  contains  an  inventory  of  thousands  of new and
                    pre-owned  vehicles,  representing  virtually all automobile
                    manufacturer  makes and models.  In addition to  determining
                    which dealers have desired  vehicles in inventory,  shoppers
                    may view digital  photos of the autos.  Inventory is updated
                    on a daily basis to reflect  additions and  subtractions due
                    to sales or the arrival of additional vehicles.

                    For auto  dealers,  the system  provides  a new  incremental
                    distribution channel, which generates highly qualified sales
                    leads.  The system  generates  recurring  revenues  for both
                    Navidec and The Denver Post.

<PAGE>


Architecture:       The  Colorado  Wheels site was  written in Java,  using high
                    performance Java servlets.  The servlet architecture enables
                    complex  query  functions to be handled on the server end of
                    the system.  Sybase is the underlying  database used for the
                    site.

Development
Features:
                - Locate a vehicle yourself or request an assisted search Search
                  by the following criteria:
                     - Range according to your zip code
                     - Year, make, model, type & price
                - Construct an interest list based on your search results
                - Search for dealers within your range based on your zip code
                - Java development allows vendor and system independence
                - Shared common code baseline and database with dealer Web sites
                    and
                           Navidec's   Interactive   Auto  Sales   Kiosks  allow
                  synchronized updates across multiple systems
                - Highly responsive query capabilities


Account:            Denver Metro Convention and Visitor's Bureau

Industry:           Conference Marketing and Reservations

Description:        The Denver Metro Convention and Visitor's  Bureau's (DMCVB),
                    primary  responsibility is to market and promote the city of
                    Denver, Colo., as a prime convention location to businesses,
                    organizations and individuals worldwide.

                    The bureau's  vision was to develop and implement a Web site
                    that would help market  Denver to  potential  conventioneers
                    and  visitors  as  well  as  to  provide  meeting  planners,
                    visitors  and  local  members  with  information   regarding
                    activities, restaurants,  accommodations, shopping and other
                    services  available  once  they  arrived.  The  goal  was to
                    provide  users  with a  single  comprehensive  resource  for
                    information.

                    Highlights of the site include  information about Denver and
                    the Rocky Mountain region. Detailed information is available
                    on Denver  shopping,  restaurants and menus,  accommodation,
                    attractions  and other  services of  interest to  convention
                    groups  and  visitors  to the city and  region.  A  database
                    driven event calendar provides local events listings.

Architecture:       The Web site is hosted  on a Unix  server  running  Netscape
                    Enterprise  server.  All of the software was developed using
                    HTML, CGI script, and Javascript.  Functionality was cutting
                    edge when the site was developed in 1996.

Development         The DMCVB Web site is comprehensive with a vast breadth of
Features:           information.  Key features of the site include:

                    -  Database driven events calendar
                    -  Database of convention bureau membership
                       -  Searchable by type of product or service
                       -  Searchable by name
                    -  Database driven directories for the following local
                        information:
                       -  Dining
                       -  Accommodations

<PAGE>

                       -  Transportation
                       -  Attractions
                       -  Art & Culture
                       -  Recreation
                       -  Services & Relocation
                       -  Kid Stuff
                       -  Shopping
                    -  Meeting planning assistance
                       -  Maps for convention sites
                       -  Online booking services
                    -  Rotating banner ads
                    -  Interactive map constrains database driven searches b
                        region

Account:            Primestar by TCI

Industry:           Broadcast/Entertainment

Description:        Primestar   by  TCI   is  a   division   of  TCI   Satellite
                    Entertainment,  Inc. Primestar markets satellite  television
                    services to  approximately  40 percent of the United States.
                    The  majority  of  its  customers   primarily  are  families
                    residing  in rural  parts of the country as opposed to major
                    metropolitan  areas.  Primestar's  current offerings include
                    160 video and audio viewing  channels,  equipment to receive
                    and  display  television  satellite  signals  which  may  be
                    purchased or rented,  high quality digital picture or sound,
                    in-home service, 24-hour customer service and support, and a
                    full line of accessory products.

                    Primestar  by TCI's vision was to build a Web site to market
                    its  products  to  new  markets,  particularly  metropolitan
                    markets.  The goal was to design a family oriented site that
                    presents  Primestar  systems and  programming as the premium
                    product on the market.

                    Navidec used state-of-the-art 3D rendered graphics to design
                    a colorful,  three-dimensional  Primestar Town. The Web site
                    created  a  typical  small  town  setting,   including  such
                    features  as the  town  hall,  schoolhouse,  newsstand,  and
                    shopping mall.

                    Web site users are able to navigate around the town and into
                    buildings to receive up-to-date information about Primestar.
                    The site also allows users to participate in events like the
                    Virtual  Town Meeting to address  family  issues and provide
                    information  feedback  to  Primestar  on such  issues  as TV
                    ratings and current program airings.

                    After perusing the most in-depth  information  available for
                    Primestar  products,  users can initiate their purchase with
                    an online order form or request a demo.

Architecture:       The  Primestar  Web site is  hosted on a Unix  system  using
                    Netscape Enterprise server. Navigation and mouse-over events
                    were designed  using Java  applets.  The zip code search and
                    validation functions are database driven.

                    3D rendered  artwork was used to maximize  the  adaptability
                    for changes and  updates.  For  example,  a holiday  'Layer'
                    could be created  for every scene and  scheduled  during the
                    holiday season. Or, Primestar could change a light source to
                    be driven by the time the user logs on.  For  example,  if a
                    user logs on in the A.M., the sun is in the east, and if the
                    user logs on at night, the town is moonlit.  The screen shot
                    on the  previous  page  shows an empty lot on the left side.
                    That lot is reserved  for a sports  complex  where users can
                    get the  latest  information  on  sports  programming.  When
                    ready, Navidec can plug the stadium module into the existing
                    artwork.

<PAGE>


Development
Features:
                    3D rendered graphics
                    Java pop-up mouse events
                    Java  content   driven  button  bar   navigation   Zip  code
                    validation   database   Zip  code  driven   marketing   data
                    collection  Online order form Demo request form Town meeting
                    forum

Account:            Live Entertainment

Industry:           Broadcast/Entertainment

Description:        Live Entertainment is a diversified company that specializes
                    in the marketing  and  distribution  of media  entertainment
                    both within the United  States and  internationally.  Live's
                    primary business focus is the selling of motion pictures and
                    related  movie  merchandise  used to promote  and  advertise
                    films.

                    Live  Entertainment's goal was to develop a site which would
                    enable Live to provide  information to the public as well as
                    enable users to purchase directly from the Live inventory of
                    videocassettes,    interactive    CDs   and    movie-related
                    merchandise.

                    Navidec  designed the Live Web site to appear as a 3D store.
                    Visitors  to the site  enter the store and are able to click
                    on a piece of  clothing  merchandise  to  determine  colors,
                    sizes and pricing  prior to ordering  online.  The site also
                    has a home theater, enabling visitors to view video clips of
                    Live  movies.  Users also have access to Club Live,  a video
                    club where site  visitors  can  register and join to get new
                    information   about   special  Live   Entertainment   movie,
                    merchandise and promotional offerings.

Architecture:       The Web site is  hosted on a  Silicon  Graphics  Challenge-S
                    running the Irix operating  system.  The Web server software
                    is  Netscape   Enterprise  Server  3.0.  The  animation  was
                    developed  using  Macromedia  Director  6.0. A Verity search
                    engine,  Quicktime  video  and an MSQL  Database  are  other
                    technologies used to develop and support the site.

Development
Features:
                    -  Registration database with a variety of client reporting
                        tools
                    -  Suite of page update tools
                       -  Career opportunities
                       -  Home page text
                       -  Financial form
                       -  International page(s)
                    -  Web site monitoring and statistics
                    -  Keyword search capability
                    -  Shockwave animation throughout the site
                       -  Awarded Shocked Site of the Day 3/16/97
                    -  Custom secure E-Commerce engine, developed by Navidec

<PAGE>


Account:            Destination Hotels & Resorts

Industry:           Travel

Description:        Destination  Hotels  and  Resorts  (DH&R) is the  management
                    corporation   for   world-class   luxury  hotel  and  resort
                    properties located  throughout the country.  The distinctive
                    properties are designed to restore your spirit and stir your
                    imagination.   The  properties  also  include  spacious  and
                    well-designed conference facilities for business meetings.

                    This service enables users to shop for gift shop merchandise
                    from DH&R resorts.

                    DH&R's  vision  was to develop a unique,  comprehensive  Web
                    site which would enable  potential  customers the ability to
                    obtain  the  latest  information   regarding  DH&R's  resort
                    properties  and provide them with tools for  planning  their
                    vacations  and business  travel.  In addition to providing a
                    trip planning  tool,  DH&R also wanted to give customers who
                    had  stayed  at  their   properties  as  well  as  potential
                    customers  the  ability  to  relive  or  dream  about  their
                    vacations through online purchases of resort merchandise.

Architecture:       The DH&R  E-Commerce  system is based on AT&T's  Secure Buy.
                    This was one of the first Secure Buy systems  implemented in
                    the  country.  In addition to  providing  access to the DH&R
                    Destination  Express  site  via the Web,  Navidec  developed
                    on-site kiosks, which were deployed throughout DH&R's resort
                    properties.

Development         Key information and features of the DH&R Web site include:
Features:
                    -  Resort properties
                    -  Offer  special  resort value  packages  (coming soon)
                    -  On line access to the DH&R site via kiosks located at
                        resorts On line store for purchasing merchandise
                       -  Navidec is also the fulfillment agent

Account:            Bryan Memorial Hospital

Industry:           Healthcare

Description:        Bryan Memorial Hospital is the largest  healthcare  provider
                    in  the  state  of   Nebraska.   In  addition  to  providing
                    healthcare  services  for its  customer  base,  the hospital
                    interfaces with numerous private and governmental  agencies.
                    Bryan Memorial processes  information and performs thousands
                    of data transactions in paper formats everyday.

                    Bryan's  vision is to  implement  a  state-of-the-art,  open
                    systems solution to provide an effective,  highly secure way
                    to perform all of its business transactions  electronically.
                    Its  goal  is  to   operate   much  more   efficiently   and
                    productively and save operating costs in the process.

                    Navidec  has  installed  a 700  seat  pilot  solution  using
                    Netscape   servers.   This  Netscape  pilot  replaced  Bryan
                    Memorial's previous proprietary Novell GroupWare system. The
                    pilot  program  enables  Bryan  Memorial  to  implement  new
                    e-mail,  calendar,  and Web  capabilities  for  internal and
                    external  communication.  Netscape  Directory  Services with
                    LDAP   and   the   Certificate   Server   provide   ease  of
                    administration and the security needed to perform electronic
                    data  transfers.  Annual overall  savings for Bryan Memorial
                    are expected to be in excess of $200,000.

<PAGE>


Architecture:       The 700 seat pilot  program  involved  the  installation  of
                    seven Netscape  servers on a DEC Alpha server running NT 4.0
                    SP3. The server was a two processor configuration with 512MB
                    of RAM  and  RAID 5  backup.  Desktop  clients  were  TCP/IP
                    enabled.

Development
Features:           Open  TCP/IP   E-Mail  (No   gateways  to   Internet)   Open
                    Calendaring  (Unified LDAP  Directory)  Open Web  Publishing
                    (Secure, controlled access) LDAP Directory Services (Single,
                    unified    resource    directory)   Proxy   Services   (User
                    authentication   &   secure   data   transactions)   Desktop
                    Management Services  (consistent desktop user interface with
                    remote administration capabilities)

Account:            Merrick & Company

Industry:           Engineering

Description:        Merrick  & Company  is a  multi-discipline  engineering  and
                    architectural  firm  headquartered in Denver,  Colo. Merrick
                    serves a variety of clients including Advanced Technologies,
                    Government,  Light  Industry  and  Heavy  Industry.  Merrick
                    employs a  professional  base of nearly 500 and has  offices
                    throughout the United States.

                    Merrick's   vision  for  its  corporate   intranet  was  the
                    comprehensive  integration  of  all  corporate  systems  and
                    organizations.  Key corporate information is integrated from
                    HR,   Marketing,    Project   Management,    Administration,
                    Accounting  and Project  Tracking  and  Information  Systems
                    organizations.

                    The goals and expected  benefits of the Merrick Intranet are
                    as follows:

                    -  Reduce operating costs
                    -  Improve the accuracy and distribution of critical
                        information
                    -  Improve service to employees Automate key processes
                    -  Migrate from paper to electronic management of vital
                        corporate information
                    -  Control increasing data synchronization, management and
                        security problems

 Architecture:      Navidec  developed a  completely  custom  intranet  solution
                    supported by a data  warehouse  integrating  data from seven
                    legacy  systems.  The intranet was developed using Microsoft
                    Web technology exclusively due to the client's requirements.
                    All  departments  and  information   driven   functions  are
                    integrated or impacted by the intranet.

Development
Features:           Developed on the  Microsoft  IIS Web server on an NT system.
                    Custom applications for complex, state driven, multiple user
                    functions  were  developed in Java.  The data  warehouse was
                    developed in MS-SQL and  integrates a total of seven Oracle,
                    MS  Access  and  proprietary   database  systems.  The  data
                    warehouse  will  ultimately  replace all of the minor legacy
                    systems  and   provides   the  quality   control   gate  for
                    synchronizing data between the primary databases.

                    Database driven, custom applications include:

                    -  Online organization charts
                    -  Function and role based 'Yellow  Pages'for the online
                        help desk
                    -  Bid and proposal generation and tracking
                    -  Project creation and tracking system

<PAGE>

                    -  Key  corporate  financial   information
                    -  Marketing and forecast  reports
                    -  Quality assurance procedure, including training and
                        tracking

Other  sites  developed  by  the  Company   include   Sunstrand  Fluid  Handling
(http://www.sfh.com)   Richmond  American  Homes   (http://richmondamerican.com)
currently  under   development,   Denver  Metro  Convention  &  Visitors  Bureau
(http://www.denver.org),  Christopher Dodge (http://www.cdodge.com), Plastiprint
(http://plastiprint.com),  On Sale Online  (http://onsaleoneline.com),  Lakewood
Hospitality  Association  (http://denverwesthotels.com),  Cohen Brame & Smith PC
(http://www.cbspc.com),  Kloppenberg  (http://kloppenber.com  ), Belmar Pharmacy
(http://www.belmarpharmacy.com),       Kimmon       Electric      Co.,      Ltd.
(http://www.kimmon.com),    KUSA-9News   (http://www.9news.com),    ,   Colorado
Recreation  (http://www.coloradorecreation.com) and the American Animal Hospital
Association (http:// www.healthypet.com).



DISTRIBUTION AND RELATED SERVICES

The Company  distributes high technology systems and components  manufactured by
third  parties and provides  related  services  such as system  integration  and
installation.  Product  distribution  clients  range  from small  businesses  to
Fortune 100 companies. Significant product distribution clients include Lockheed
Martin,  Johnson Controls,  Hughes Aircraft and US West. The Company serves both
as  a  national  manufacturer's  representative  for  the  products  of  certain
international  manufacturers  and as a reseller of selected computer products in
the Rocky Mountain region. The Company focuses its distribution  efforts towards
selling specialized,  higher margin products.  The Company intends to expand its
product distribution  activities into electronic channels,  including sales over
the Internet on the Company's Web site.

Distribution activities usually involve the receipt by the Company of orders for
equipment from  prospective  purchasers and the delivery and/or  installation of
the equipment by the Company.
The Company purchases the equipment directly from the manufacturer or vendor and
resells it to the purchaser at a price which  includes the Company's  cost and a
profit  margin.  With the  exception of graphics  supplies and certain  imported
components,  the Company does not generally maintain an inventory of products it
distributes. The Company specializes in components,  lasers, graphics, supplies,
and systems integration.

Components

The Company represents and distributes  component products from several Japanese
manufacturers,   principally  Hayashi  Denko  and  Sunmoulon.  Products  include
temperature  sensors,   push-button  switches  and  numerous  other  specialized
components.  These  products are sold  primarily  through phone sales as well as
through a national network of manufacturer's representatives.
Most of these components are sold to original  equipment  manufactures  ("OEMs")
which  incorporate  these components into their product designs.  Key industries
for the  Company's  component  products  include:  industrial  process  control,
heating,  ventilation  and air  conditioning  (HVAC),  energy  management,  food
processing, consumer appliances and medical monitoring.

Graphics

The  Company  sells  graphics  products  focused  in the  areas of data  capture
(scanning, digital cameras and X-terminals) and color output (color printers and
LCD  projection  devices).  The  sale of  many  of  these  products  is  through
territorial  authorizations  granted to the  Company by the  manufacturers.  The
Company has  significant  manufacturer  alliances with Xerox,  Tektronix,  Sony,
InFocus and Hewlett  Packard.  Graphics  products are sold primarily to end-user
customers by a direct sales team  operating both in the field as well as through
an inside sales group which takes orders from existing customers.

<PAGE>


Supplies

The Company sells  consumable  supplies for color graphic  output  devices.  The
Company  stocks an inventory of popular  consumables  in order to provide prompt
response  for  customer  orders.  In  addition,   the  supplies  division  sells
third-party extended warranty agreements for all hardware products.


Systems Integration

The Company  offers  network  design and  implementation  services to  corporate
customers  in the Rocky  Mountain  region,  which  services  often  include  the
acquisition  and location of network  equipment and servers.  These services are
performed by a direct sales team. The primary manufacturers of network equipment
and servers distributed by the Company are Compaq, IBM and Hewlett Packard.


EMPLOYEES

There are currently 51 full-time employees of the Company. These include nine in
Client Services, five in creative services, thirteen in World Wide Web Services,
two in  Marketing  Services,  fourteen  in sales,  and eight in  management  and
administration.


The Company  expects to hire ten  additional  full-time  employees in the twelve
months following this report. The Company currently  anticipates three new hires
dedicated to sales,  four new hires  dedicated to client  services and three new
technical employees.


COMPETITION

Existing competitors to the Internet/Internet  Solutions business include Online
Systems Services, Inc., Eagle River Interactive, Inc. and Open Market, Inc., all
public companies  traded on NASDAQ,  as well as a large number of regional firms
providing  similar  services to those of the Company.  Potential  competitors in
this business include browser software vendors, PC and UNIX software vendors and
on-line  service   providers.   Additional   competition   comes  from  numerous
client/server companies, database companies,  multimedia companies,  advertising
agencies, document management companies,  networking software companies, network
management companies and educational software companies. In a broader sense, the
Company may  compete  with the more  traditional  advertising  and  distribution
mediums, such as radio, television and mail order outlets.

Potential competition also comes from the Company's clients, who could choose to
address their  Internet/Intranet  needs through in-house personnel.  Some of the
Company's  current and many of the Company's  potential  competitors have longer
operating histories,  greater name recognition,  larger installed customer bases
and  significantly  greater  financial,  technical and marketing  resources than
those of the Company.  Competitive  factors in the  Internet/Intranet  Solutions
business  include core  technology,  breadth of services  offered,  creative and
artistic  ability,  marketing and distribution  resources,  customer service and
support and price.

A large number of companies act as re-marketers of computer  networks,  graphics
equipment and components,  and the Company's  competition in the high technology
product distribution business is therefore also intense. In some instances,  the
Company, in acting as a re-marketer, may compete with the original manufacturer.
In addition, a large number of companies offer the reprographic services offered
by the  Company  and  competition  in this  area is  also  intense.  Many of the
Company's  competitors in the high technology product distribution business have
longer operating histories, greater name recognition,  larger installed customer
bases,  larger sales staffs and substantially  greater financial,  technical and
marketing resources than those of the Company.

<PAGE>


Competitive  factors in the distribution  business include technical  expertise,
breadth of products  offered,  product  quality,  performance  and  reliability,
price, name recognition, customer service and support and access to distribution
channels.


Competitors in the automotive market

There are numerous online  automotive sales Web sites on the Internet today, but
none that employ the same total solution  strategy as Wheels.  Other online auto
sales products include Carpoint,  Auto-by-Tel,  AutoConnect,  and AutoVantage. A
few Internet  developers  are also  attempting to sell online sales  products to
media, but none offer the total sales solution that Wheels offers to ensure that
dealers sell vehicles,  including  important add-ons such as touch-screen kiosks
and  mobile  sales  laptops.  Another  important  distinction  is  that  Navidec
understands  the auto sales  process and even  trains  dealers to help them sell
more autos from the leads  generated by Wheels.  Navidec  employees have over 40
years of  experience in the  automotive  industry and have expended over 190,000
hours into the development of the Wheels solution.

Navidec has hired a team of experts well versed in the automotive business,  and
has the president of Denver's largest independently owned dealership group (Burt
Automotive) on its board of directors.  These experts enable Navidec's access to
the latest  industry  information  and a deep  understanding  of the  automotive
business and its processes.  This team has enabled Navidec to develop a solution
which primary focus is on enabling  automotive  dealers the ability to sell more
cars.

Both the  Internet/Intranet  Solutions  business and the high technology product
distribution  business are characterized by low financial  barriers to entry and
frequent   introductions  of  new  products.   The  Company   therefore  expects
competition in each of its businesses to increase in the future. There can be no
assurance  that  the  Company  will  be  able  to  successfully  compete  in its
businesses.  Although the Company believes that it has the requisite management,
technical and creative abilities to successfully  compete,  the intense level of
competition  in each of the  Company's  businesses  could  materially  adversely
affect the Company's future operating results and financial condition.


ITEM 2.   DESCRIPTION OF PROPERTY

The Company's  headquarters are located at 14 Inverness Drive, Building F, Suite
116,  Englewood,  Colorado,  in a 8,900  square foot  facility,  which  includes
approximately  1,500  square feet in warehouse  space.  The facility is occupied
under a lease with an unaffiliated party expiring in June 2001 and providing for
a current  monthly  lease rate of $8,150.  The Company also leases space at 1300
Plaza North, Suite 101, Lafayette, CO, this is a 1,500 square foot facility. The
facility is occupied under a lease with an  unaffiliated  party expiring in June
1999 and  providing  for a monthly  lease rate of $2,180.  The Company may lease
additional  warehouse  and  office  space if needed  to  support  the  growth in
traditional and on-line product distribution.

ITEM 3.  LEGAL PROCEEDINGS

The Company is currently not involved in any material legal proceedings.

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

No  matters  were  submitted  to a vote of  security  holders  during the fourth
quarter of the fiscal year ended December 31, 1997.

<PAGE>


PART II.

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

The Company's Common Stock commenced trading on the Nasdaq SmallCap Market under
the symbol  "NVDC" on February 11, 1997.  The Company also has a class of common
stock purchase warrants  ("Warrants") listed on the Nasdaq SmallCap market under
the symbol "NVDCW." The Warrants also commenced trading on February 11, 1997.

                                Common Stock                   Warrants
                            --------------------          --------------------
Quarter Ended                High          Low             High          Low
March 31, 1997              $5.625        $5.125          $0.750        $0.625
June 30, 1997               $6.000        $3.250          $0.875        $0.375
September 30, 1997          $7.000        $5.250          $1.031        $0.625
December 31, 1997           $7.000        $4.063          $1.031        $0.025


The  closing  price as of March 30,  1998 was $6.375 and  $0.6875 for the common
stock and warrants respectively.

As of March 30,  1998,  the  Company  had 78 common  shareholders  of record and
believes  that   approximately   1,400  persons  beneficial  owns  street  named
positions.

The Company has not  declared any cash  dividends  on its common  shares for the
last two fiscal  years.  The  Company  currently  intends  to retain  funds from
earnings, if any, from future grow and therefore does not intend to pay any cash
dividends  in the  foreseeable  future on its Common  Stock.  The Company is not
currently a party to any agreement restricting the payment of dividends.


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

Cautionary Statement Regarding Forward Looking Statements. The matters discussed
here and  elsewhere in this report,  when not  historical  matters,  are forward
looking  statements that involve a number of risks and uncertainties  that could
cause actual results to differ materially from projected  results.  Such factors
include,  among other things, the rapidly developing and unpredictable nature of
the Internet, intense competition in all of the Company's markets,  obsolescence
of products and technological changes, the need for management of growth and the
dependence on relationships of the Company with its customers and suppliers,  as
well as other risk factors  described from time to time in the Company's filings
with the Securities and Exchange Commission.

Overview

The Company was organized as ACI Systems, Inc. in July 1993 and changed its name
to NAVIDEC,  Inc. in July 1996 when it acquired IPI, a designer and developer of
Internet World Wide Web sites.  The Company's  principal  sources of revenue are
from  the  resale  of  computer  equipment,   high  technology  peripherals  and
electronic components manufactured by independent vendors (Product Distribution)
and services related to Internet/Intranet Solutions, license fees from recurring
lead  revenue  from the Wheels  solution.  The Company  issued an  aggregate  of
678,877 shares of Common Stock to the  shareholders of IPI and a promissory note
in the amount of $75,000 to one  shareholder  of IPI in exchange  for all of the
issued and outstanding stock of IPI. The Company acquired  TouchSource,  Inc., a
designer and developer of interactive  Kiosks,  in July 1997. The Company issued
an aggregate of 207,000 shares of Common Stock to the  shareholders of TS and TS
was merged into the Company in  exchange  for all of the issued and  outstanding
stock of TS. The merger and acquisition  were consummated in order to expand the
Company's  business  model of combined  expertise in  traditional  marketing and
distribution and Internet/ Intranet technology.

<PAGE>

The  Company's  strategy  is to  increase  revenue  generated  by its  two  core
competencies:  (1) Internet/Intranet  Solutions, which are focused in five major
market areas, including computer and network infrastructure equipment,  software
and services,  content  aggregation,  electronic commerce and order fulfillment,
and (2) Product  Distribution.  The Company has built and intends to continue to
build an  infrastructure  that assumes this strategy  will  succeed.  Management
believes  that,  based on the current  product  mix,  the  Company's  new Wheels
solution will  provided for the majority of its  increased  revenues in 1998 and
years  to  follows.   The  Wheels  solution  combines  the  companies  two  core
competencies of Internet/Intranet solutions and product distribution.  Wheels is
designed on a state of the art platform that allows it to distribute  electronic
information  out to  consumers  through  regional  wheels web sites,  individual
dealer web sites, remote automotive kiosks and also in mobile sales laptops. The
failure of the Company to achieve this  strategy  could have a material  adverse
effect on the Company's business, financial condition and results of operations.

The Company recognizes revenue upon delivery of its Internet/Intranet  Solutions
and Product Distribution goods. Internet/Intranet Solutions generally begin with
consulting arrangements that are billed on an hourly basis and progress to a bid
for a proposed project. Deposits are then taken upon acceptance of the bid. Most
of  the  Company's  customers  elect  to  update  and  expand  their  Web  sites
frequently,  and clients are billed  monthly on a time and  materials  basis for
these  services.  Additional  sources of ongoing  revenue  include  revenue from
advertising  sold by the  Company on clients  Web sites,  revenue  from sales of
merchandise and services over clients Web sites and revenue from maintenance and
hosting of client Web sites.

From  August  through  October,   1996,  the  Company  raised  net  proceeds  of
approximately $1,233,000 from the sale of 10% Unsecured Subordinated Convertible
Promissory  Notes (the "Bridge  Promissory  Notes") in a private  placement (the
"Bridge Private  Placement").  These notes were converted by their terms into an
aggregate of 349,126 Units upon  consummation  of the Company's  public offering
described  below.  The Units were  identical to the Units  offered in the public
offering.

On February 14, 1997,  the Company  consummated  a public  offering of 1,000,000
Units  consisting  of one share of Common  Stock and one Common  Stock  purchase
warrant  ("Warrant").  Each Warrant entitles the holder to purchase one share of
Common Stock at a price of $7.20 per share until February 10, 2002. The Warrants
are redeemable at the option of the Company, at $.05 per Warrant, at any time on
or after  February 10, 1998 or such earlier date as may be  determined by Joseph
Charles & Associates,  the managing  underwriter in the public offering.  Of the
1,000,000  shares  of  Common  Stock  and  1,000,000  Warrants  included  in the
offering,  755,000 shares of Common Stoc and 1,000,000  Warrants were sol by the
Company,  for net proceeds of approximately  $3,436,000  (after  subtracting the
underwriting discount and other expenses of the offering). The remaining 255,000
shares  of  Common  Stock  were  sold by the  investors  in the  Bridge  Private
Placement.

From  November  1997  to  March  1998,   the  Company  raised  net  proceeds  of
approximately  $888,000 from the issuance of 233,577 shares of commons stock and
warrants from a private placement.  Each Warrant entitles the holder to purchase
one share of Common Stock at a price of $7.20 per share until February 10, 2002.
The Warrants are  redeemable at the option of the Company,  at $.05 per Warrant,
at any time on or after February 10, 1998.

No holder of the public offering or private placement Warrants, as such, will be
entitled  to vote or  receive  dividends  or be deemed  the  holder of shares of
Common  Stock for any purpose  what so ever until such  Warrants  have been duly
exercised  and the  purchase  price  has been  paid in full.  The  Warrants  are
redeemable at the option of the Company,  at $.05 per Warrant, at any time on or
after February 10, 1998 upon thirty days' prior written notice, at any time when
the closing price per share of Common Stock for twenty consecutive  trading days
within the  thirty-day  period prior to the date notice of  redemption  is given
equals  or  exceeds  $8.40  and  at  such  time  there  is a  current  effective
registration  statement  covering  the  shares of Common  Stock  underlying  the
Warrants.

<PAGE>


Results of Operations

The following tables sets forth for the periods  indicated the percentage of net
sales  represented by certain line items included in the Company's  statement of
operations.


                               Year Ended
                               December 31
                                  1997                       1996

Net Sales                    100%     $6,008,000       100%     $5,470,000
Cost of Sales                 70       4,219,000        81       4,425,000
Gross Margin                  30       1,789,000        19       1,045,000
Operating Expense             73       4,367,000        40       2,259,000
Other Income (Expense)       (25)     (1,529,000)       (3)      ( 201,000)
Net Income (Loss)            (68)     (4,107,000)      (24)     (1,415,000)


Net sales for fiscal 1997 were  $6,008,000  which  represents an increase of 10%
over  net  sales of  $5,470,000  in  fiscal  1996.  The  increase  is  primarily
attributed to sales of  Internet/Intranet  Solutions,  which were  $1,519,000 an
increase  of 290% over net sales of $389,000 in fiscal  1996.  Wheels  which was
introduced  in the fourth  quarter of 1997  accounted for $232,000 or 56% of the
$413,000 in Internet  revenue  during the  quarter.  In  addition,  net sales of
Computer  Infrastructure  were  $1,819,000  an increase of 49% over net sales of
$1,221,000.  The  increase  in net  sales in all two  categories  was  primarily
attributable to increased marketing activities and greater market penetration.

Net sales in product  distribution  were  $2,662,000  a decrease of 31% from net
sales of $3,860,000  in fiscal 1996.  The decrease in sales is attributed to the
discontinuation  of  distribution  products that didn't have strong gross profit
and or recurring sales. In 1997 Kimmon Electric, Inc., the Company's supplier of
laser products, began marketing its lasers directly in the United States through
Kimmon Electric USA, Inc. This resulted in a decrease in sales of $863,000.  The
decrease  affected  the  Company's  net sales but due to the  lower  margins  of
distribution did not materially adversely effect the gross margin for 1997.

Gross margin was 30% during  fiscal 1997, an increase of 11% over a gross margin
of 19% in fiscal 1996. The increase in the Company's gross margin was attributed
to management's  elimination of several  distribution  products that carried low
gross margin and the strong gross margin on  Internet/Intranet  Solutions  which
were at 57%.

Operating expenses for fiscal 1997 were $4,367,000  compared with $2,259,000 for
fiscal 1996.  The increase in operating  expenses was primarily the result of an
increase  in staff  and  marketing  activity  and  legal  and  consulting  fees.
Operating  expenses  are expected to remain  stable as the Company  continues to
invest in the development of high end Internet/Intranet Solutions.

Net interest  expense for fiscal 1997 was $236,000  compared  with  $204,000 for
fiscal  1996.  The  increase was a result of the Bridge  Promissory  Notes.  The
company expects interest expense to decrease in 1998.

In 1998 the company  experienced  $1,305,000  in expense for the  impairment  of
goodwill.  The  goodwill  was the result of the merger  with IPI in 1996 and the
acquisition of TS (see  additional  discussion on impairment,  which follows) in
1997.


<PAGE>


Liquidity and Capital Resources

Through December 31, 1997, the Company funded its operations  primarily  through
equity investments, through the companies IPO and subsequent Private Placements,
and revenues  generated from operations,  loans from principal  shareholders and
employees,  lines of credit and factoring  arrangements  made available to it by
banks.  On December  31,  1997,  the Company  had cash and cash  equivalents  of
$369,000 and a net working capital of $678,000. This compares with cash and cash
equivalents  of $231,000 and a working  capital  deficit of $711,000 on December
31, 1996.

Cash  used in  operating  activities  for the  Company  totaled  $3,359,000  and
$631,000  for  fiscal  1997  and  1996,  respectively.  Cash  used in  investing
activities  consisted of expenditures for property and equipment and cost of the
acquisition of TouchSource. Capital expenditures increased to $475,000 in fiscal
1997 from $472,000 during fiscal 1996.

Cash from  financing  activities  in fiscal  1997  consisted  of  advances  from
factoring arrangements of $634,000 net of repayments of $444,000,  proceeds from
the  issuance of common  stock of  $,4,153,000,  borrowings  of $333,000  net of
payments of $369,000.  This compares to 1996  borrowings of $1,435,000  from the
Bridge Private Placement,  $256,000 in loans from shareholders and employees and
$4,196,000  in advances  through the  factoring  arrangement  with the Company's
bank, net of $226,000 in repayments of shareholder/employee loans and $4,382,000
in factoring and line of credit payments.

The Company has not recorded a deferred tax asset as it cannot  conclude to date
that it is more likely than not that the deferred tax asset will be realized.


Impairment of Long-Lived Assets

Effective July 1, 1996 the Company acquired 100% of the stock of IPI for 679,000
shares of common  stock of the Company and a $75,000  note payable in a purchase
transaction.  The acquisition was valued at approximately  $750,000 and resulted
in goodwill of approximately  $850,000 being recorded.  The expected future cash
flows associated with the technology previously developed by IPI declined due to
rapidly changing  technologies and increased  competition for products developed
with the IPI technology.  In addition,  during the fourth quarter of 1997, after
the introduction of new Internet solutions by the Company, management decided to
focus the Company on its automotive  solution.  As such, the Company reevaluated
the goodwill related to this  acquisition and recorded an impairment  expense of
$598,000,  resulting in a remaining net balance of $20,000.  This amount will be
amortized over the next year.

Effective July 31, 1997,  the Company  acquired 100% of the stock of TouchSource
for 207,000 shares of common stock of the Company in a purchase transaction. The
acquisition  was valued at  approximately  $776,000  and resulted in goodwill of
approximately  $859,000  being  recorded.  Subsequent to the  acquisition,  Java
technologies  developed far more rapidly than  expected,  causing the company to
replace a large  portion of the  software  developed  by  TouchSource  which has
reduced the expected future cash flows  associated the  TouchSource  technology.
Furthermore,  the Company intends to integrate the  TouchSource  technology with
its other products and market it primarily to the automotive industry, which was
not a market focus of  TouchSource.  As such, the Company also  reevaluated  the
related goodwill,  and recorded an impairment expense of $707,000 resulting in a
remaining net balance of $80,000.  This amount is being  amortized over the next
year.


Inflation

The Company does not believe that inflation  will have a material  impact on the
Company's future operations.

Year 2000

Management  has  initiated an  enterprise-wide  program to prepare the Company's
computer  systems and  applications  for the year 2000.  The Company  expects to
incur internal  staff cost as well as consulting  and other expenses  related to
the year 2000 project.  At this point,  the Company is not able to determine the
estimated  cost for its year 2000 project and, if  unresolved,  whether the year
2000 issue will have a material impact on the operations of the Company.



<PAGE>



ITEM 7.   FINANCIAL STATEMENTS








<PAGE>


                                  NAVIDEC, INC.

                          INDEX TO FINANCIAL STATEMENTS



                                                                     PAGE
                                                                     ----


Independent Auditor's Report.......................................  F-2

Balance Sheet - December 31, 1997..................................  F-3

Statements of Operations - For the Years Ended
        December 31, 1997 and 1996.................................  F-4

Statement of Changes in Stockholders' Equity (Deficit) -
        For the Years Ended December 31, 1996 and 1997.............  F-5

Statements of Cash Flows - For the Years
        Ended December 31, 1997 and 1996...........................  F-6

Notes to Financial Statements......................................  F-7



                                       F-1

<PAGE>






                          INDEPENDENT AUDITOR'S REPORT




Board of Directors
NAVIDEC, Inc.
Englewood, Colorado


We have audited the accompanying  balance sheet of NAVIDEC,  Inc. as of December
31, 1997 and the related  statements  of  operations,  changes in  stockholders'
equity (deficit), and cash flows for the years ended December 31, 1997 and 1996.
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 audits.

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

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects,  the financial position of the Company as of December 31,
1997,  and the results of its  operations and its cash flows for the years ended
December 31, 1997 and 1996, in conformity  with  generally  accepted  accounting
principles.




HEIN + ASSOCIATES LLP

Denver, Colorado
March 5, 1998


                                       F-2

<PAGE>



                                  NAVIDEC, INC.

                                  BALANCE SHEET
                                DECEMBER 31, 1997



                                     ASSETS
                                     ------



CURRENT ASSETS:
    Cash and cash equivalents                                       $   369,000
    Accounts receivable:
         Trade, net of $50,000 allowance for doubtful accounts          726,000
         Retainage                                                       21,000
    Costs and estimated earnings in excess of billings                  106,000
    Note receivable, related party                                       60,000
    Inventories                                                         549,000
    Prepaid expenses and other current assets                            86,000
                                                                    -----------
             Total current assets                                     1,917,000

PROPERTY AND EQUIPMENT, net                                             713,000

OTHER ASSETS:
    Intangibles, net                                                    169,000
    Restricted certificate of deposit                                   300,000
                                                                    -----------

TOTAL ASSETS                                                        $ 3,099,000
                                                                    ===========


                      LIABILITIES AND STOCKHOLDERS' EQUITY
                      ------------------------------------

CURRENT LIABILITIES:

    Current portion of capital lease obligations                    $    37,000
    Notes payable                                                        63,000
    Accounts payable                                                    778,000
    Accrued liabilities                                                 171,000
    Payable to factor                                                   190,000
                                                                    -----------
             Total current liabilities                                1,239,000
                                                                    -----------

CAPITAL LEASE OBLIGATIONS, net of current portion                        95,000

NOTES PAYABLE, net of current portion                                   215,000

COMMITMENTS AND CONTINGENCIES (Notes 2 and 8)

STOCKHOLDERS' EQUITY:
    Common stock, no par value; 20,000,000 share
         authorized; 3,201,000 shares issued and outstanding          6,768,000
    Accumulated deficit                                              (5,218,000)
                                                                    -----------
             Total stockholders' equity                               1,550,000
                                                                    -----------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                          $ 3,099,000
                                                                    ===========

















              See accompanying notes to these financial statements.

                                       F-3

<PAGE>

                                  NAVIDEC, INC.

                            STATEMENTS OF OPERATIONS



                                                        FOR THE YEARS ENDED
                                                            DECEMBER 31,
                                                   ----------------------------
                                                      1997              1996
                                                   -----------      -----------

NET SALES                                          $ 6,008,000      $ 5,470,000

    Cost of sales                                    4,219,000        4,425,000
                                                   -----------      -----------

GROSS MARGIN                                         1,789,000        1,045,000

    Operating expense                                4,367,000        2,259,000
                                                   -----------      -----------

OPERATING LOSS                                      (2,578,000)      (1,214,000)

OTHER INCOME (EXPENSE):
    Interest expense, net                             (236,000)        (204,000)
    Other                                               12,000            3,000
    Impairment of goodwill                          (1,305,000)            --
                                                   -----------      -----------
         Other, Net                                 (1,529,000)        (201,000)
                                                   -----------      -----------
NET LOSS                                           $(4,107,000)     $(1,415,000)
                                                   ===========      ===========

NET LOSS PER SHARE (Basic and Diluted)             $     (1.47)     $      (.73)
                                                   ===========      ===========

WEIGHTED AVERAGE COMMON SHARES AND
  EQUIVALENTS OUTSTANDING                            2,799,526        1,948,000
                                                   ===========      ===========
















              See accompanying notes to these financial statements.

                                       F-4

<PAGE>
<TABLE>
<CAPTION>

                                                       NAVIDEC, INC.

                                  STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)
                                        FOR THE YEARS ENDED DECEMBER 31, 1996 AND 1997

                                                              COMMON STOCK
                                                     -----------------------------        ACCUMULATED
                                                       SHARES            Amount             Deficit             Total
                                                     -----------       -----------        -----------        ----------
<S>                                                  <C>              <C>                <C>                <C>
BALANCES, January 1, 1996                                217,000       $    63,000        $  (118,000)       $   (55,000)

    Exercise of stock options                            805,000             2,000               --                2,000
    Compensation recognized related to
         transfers of common stock to
         employees                                          --              83,000               --               83,000
    Shares issued in acquisition of IPI                  679,000           675,000               --              675,000
    Reclassification of accumulated
         deficit in connection with
         termination of tax status as a
         Subchapter S-Corporation                           --            (422,000)           422,000               --
    Net loss                                                --                --           (1,415,000)        (1,415,000)
                                                     -----------       -----------        -----------        -----------

BALANCES, December 31, 1996                            1,701,000           401,000         (1,111,000)          (710,000)

    Conversion of unsecured promissory
         notes to common stock                           104,000         1,438,000               --            1,438,000
    Issuance of common stock and
         warrants in a public offering, net
         of offering costs                             1,000,000         3,436,000               --            3,436,000
    Issuance of common stock for
         acquisition of TouchSource                      207,000           776,000               --              776,000
    Issuance of common stock and
         warrants in a private placement,
         net of offering costs                           189,000           717,000               --              717,000
    Net loss                                                --                --           (4,107,000)        (4,107,000)
                                                     -----------       -----------        -----------        -----------

BALANCES, December 31, 1997                            3,201,000       $ 6,768,000        $(5,218,000)       $ 1,550,000
                                                     ===========       ===========        ===========        ===========










                                    See accompanying notes to these financial statements.

                                                              F-5
</TABLE>

<PAGE>
<TABLE>
<CAPTION>

                                                        NAVIDEC, INC.

                                                  STATEMENTS OF CASH FLOWS

                                                                                   FOR THE YEARS ENDED
                                                                                        DECEMBER 31,
                                                                              ----------------------------------
                                                                                 1997                   1996
                                                                              -----------            -----------
<S>                                                                           <C>                    <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
    Net loss                                                                  $(4,107,000)           $(1,415,000)
    Adjustments to reconcile net loss to net
     cash used in operating activities:
          Depreciation and amortization                                           865,000                173,000
          Impairment of goodwill                                                1,305,000                   --
          Stock based compensation                                                   --                   83,000
          Provision for bad debt                                                   41,000                 59,000
          Changes in operating assets and liabilities:
             (Increase) decrease in:
                Accounts receivable                                              (627,000)               (56,000)
                Costs and estimated earnings in excess of billings               (106,000)
                Inventories                                                      (315,000)                 8,000
                Other assets                                                      (52,000)               (33,000)
             Increase (decrease) in:
                Accounts payable and accrued liabilities                          (92,000)               352,000
                Other liabilities                                                (271,000)               198,000
                                                                              -----------            -----------
      Net cash used in operating activities                                    (3,359,000)              (631,000)

CASH FLOWS FROM INVESTING ACTIVITIES:
    Capital expenditures for property and equipment                              (475,000)              (472,000)
    Cash acquired in mergers                                                        7,000                  5,000
    Acquisition costs incurred                                                    (32,000)               (38,000)
                                                                              -----------            -----------
      Net cash used in investing activities                                      (500,000)              (505,000)

CASH FLOWS FROM FINANCING ACTIVITIES:
    Proceeds from factoring of accounts receivable                                634,000                491,000
    Payments to factor                                                           (444,000)                  --
    Proceeds from issuance of common stock                                      4,153,000                  2,000
    Proceeds from issuance of notes payable                                       333,000              5,887,000
    Payment on notes payable and capital leases                                  (369,000)            (4,608,000)
    Payment for deferred financing and offering costs                             (10,000)              (405,000)
                                                                              -----------            -----------
       Net cash provided by financing activities                                4,297,000              1,367,000

INCREASE IN CASH AND CASH EQUIVALENTS                                             438,000                231,000

CASH AND CASH EQUIVALENTS, beginning of period                                    231,000                   --
                                                                              -----------            -----------
CASH AND CASH EQUIVALENTS, end of period                                      $   669,000            $   231,000
                                                                              ===========            ===========

SUPPLEMENTAL SCHEDULE OF CASH FLOW INFORMATION:
    Cash payments for interest                                                $    79,000            $   155,000
                                                                              ===========            ===========

    Net assets, net of cash assumed, acquired in merger of
       NAVIDEC with IPI and TouchSource                                       $   769,000            $   670,000
                                                                              ===========            ===========












                                   See accompanying notes to these financial statements.

                                                          F-6
</TABLE>

<PAGE>


                                  NAVIDEC, INC.

                          NOTES TO FINANCIAL STATEMENTS



1.   ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES:
     ------------------------------------------------

     Organization and Nature of Operations - The Company was incorporated in the
     State of Colorado in 1993 and distributes various high technology and other
     products through traditional and electronic channels.  Effective on July 1,
     1996,  the Company  merged with  Interactive  Planet,  Inc.  (IPI) and as a
     result,  the Company  also  provides  comprehensive  Internet  and Intranet
     solutions,  including  design  and  development  of World  Wide Web  sites,
     marketing,   database   integration,    electronic   commerce   and   order
     fulfillments.  Effective July 31, 1997, the Company  acquired  TouchSource,
     and as a result,  the Company  designs and markets  touch  screen  computer
     kiosks.

     Cash Equivalents - For purposes of the statement of cash flows, the Company
     considers all highly liquid debt  instruments  with original  maturities of
     three months or less to be cash equivalents.

     Inventories  -  Inventories  are  stated  at the  lower of cost or  market,
     determined  by the  first--in,  first-out  method and consist  primarily of
     products held for resale.

     Property  and  Equipment  -  Property  and  equipment  is  stated  at cost.
     Depreciation  is computed  over the  estimated  useful  lives of the assets
     using the 200%  declining  balance  method  generally over a three to seven
     year period.  Leasehold  improvements  are  amortized on the  straight-line
     method over the lesser of the lease term or the useful  life.  Expenditures
     for  ordinary  maintenance  and repairs are charged to expense as incurred.
     Upon   retirement  or  disposal  of  assets,   the  cost  and   accumulated
     depreciation  are  eliminated  from  the  account  and any  gain or loss is
     reflected in the statements of operations.

     Intangibles - Intangibles  represents  organization costs and the excess of
     the purchase  price paid over the net  liabilities  acquired in the IPI and
     the TouchSource acquisition, net of amortization costs and impairment loss.
     The remaining balance in intangibles will be amortized during 1998.

     Impairment  of  Long-Lived  Assets - In fiscal  1997,  the Company  adopted
     Financial  Accounting  Standards  Board  Statement No. 121,  Accounting for
     Impairment  of  Long-Lived  Assets  (FAS 121).  In the event that facts and
     circumstances  indicate  that the cost of  assets  or other  assets  may be
     impaired,  an  evaluation  of  recoverability  would  be  performed.  If an
     evaluation  is  required,  the  estimated  future  undiscounted  cash flows
     associated with the asset would be compared to the asset's  carrying amount
     to determine if a write-down to market value or discounted  cash flow value
     is  required.  Adoption of FAS 121 had no effect on the  December  31, 1997
     financial  statements other than the impairment of goodwill associated with
     IPI  and  TouchSource  to the  value  of the  expected  future  cash  flows
     associated with the acquired assets.

     Fair  Value of  Financial  Instruments  - The  estimated  fair  values  for
     financial  instruments  are determined at discrete  points in time based on
     relevant market  information.  These estimates  involve  uncertainties  and
     cannot be determined with precision.  The carrying  amounts of cash,  trade
     accounts receivable,  accounts payable, and accrued liabilities approximate
     fair value.

     Revenue  Recognition - The Company  recognizes revenue upon delivery of its
     Internet/Intranet  and Kiosk  Solutions  and  Product  Distribution  goods.
     Internet/Intranet  and Kiosk  Solutions  generally  begin  with  consulting


                                       F-7

<PAGE>


                                  NAVIDEC, INC.

                          NOTES TO FINANCIAL STATEMENTS



     arrangements, which are billed on an hourly basis and/or on a percentage of
     completion  method on fixed bid projects.  Most of the Company's  customers
     elect to update and  expand  their Web site  frequently,  and  clients  are
     billed monthly on a time and materials basis for these services. Additional
     sources of ongoing  revenue include  revenue from  advertising  sold by the
     Company on  clients'  Web sites,  revenue  from  sales of  merchandise  and
     services over clients' Web sites and revenue from maintenance of client Web
     sites.  The Company  receives and records a percentage of the gross revenue
     from advertising and merchandise sales immediately upon completion of these
     sales.

     Revenues    from    long-term    contracts    are    recognized    on   the
     percentage-of-completion  method for individual contracts,  commencing when
     progress  reaches a point where  experience is sufficient to estimate final
     results with reasonable accuracy. Revenues are recognized in the ratio that
     costs incurred bear to total estimated  costs.  Changes in job performance,
     estimated  profitability  and  final  contract  settlements  may  result in
     revisions to costs and income,  and are  recognized  in the period in which
     the revisions are determined.

     Contract  costs include all labor costs and those indirect costs related to
     contract  performance.  General  and  administrative  costs are  charged to
     expense as incurred.

     Profits on short-term contracts are recorded upon substantial completion of
     each  contract.  Revenues from time and material  contracts are  recognized
     currently as the work is performed.

     At the time a loss on a contract  becomes  known,  the entire amount of the
     estimated ultimate loss on both short and long-term contracts is accrued.

     Costs  and  estimated   earnings  in  excess  of  billings  on  uncompleted
     contracts," represents revenues recognized in excess of amounts billed. The
     liability,   "billings  in  excess  of  costs  and  estimated  earnings  on
     uncompleted   contracts,"   represents   billings  in  excess  of  revenues
     recognized.

     Loss  Per  Share - Loss per  share  is  presented  in  accordance  with the
     provisions of Statement of Financial  Accounting Standards No. 128 Earnings
     Per Share (FAS 128). FAS 128 replaced the presentation of primary and fully
     diluted  earnings  (loss) per share (EPS) with a presentation  of basic EPS
     and diluted  EPS.  Basic EPS is  calculated  by dividing the income or loss
     available to common  stockholders by the weighted  average number of common
     shares  outstanding  for the period.  Diluted EPS  reflects  the  potential
     dilution that could occur is securities or other  contracts to issue common
     stock were exercised or converted into common stock.  Basic and diluted EPS
     were  the  same for 1997 and 1996  because  the  Company  had  losses  from
     operations  and  therefore,  the effect of all potential  common stocks was
     anti-dilutive.

     Options  to  purchase  297,000  shares of common  stock,  and  warrants  to
     purchase  1,642,417 shares of common stock were outstanding at December 31,
     1997. See Note 9, Stockholders'  Equity,  for a detailed  discussion of the
     options and warrants issued by the Company.

     Income Taxes - During 1996, the Company  converted to a "C Corporation" and
     adopted Statement of Financial Accounting Standards No. 109, which requires
     recognition of deferred tax assets and liabilities for the  expected future

                                       F-8

<PAGE>


                                  NAVIDEC, INC.

                          NOTES TO FINANCIAL STATEMENTS



     tax  consequences  of  events  that  have been  included  in the  financial
     statements  or tax  returns.  Under this  method,  deferred  tax assets and
     liabilities are determined,  based on the difference  between the financial
     statements and tax bases of asset and  liabilities  using enacted tax rates
     in effect for the year in which the  differences  are  expected to reverse.
     Pro forma income tax expense  prior to the adoption of the "C  Corporation"
     status  is not  presented  due to  losses  for  the  year  and a  valuation
     allowance for the loss carryovers which would have been recorded under FASB
     109 after the Company's proposed public offering and the termination of the
     "S" corporate election.

     Use of Estimates - The preparation of the Company's financial statements in
     conformity  with  generally  accepted  accounting  principles  requires the
     Company's  management  to make  estimates and  assumptions  that affect the
     amounts  reported in these  financial  statements and  accompanying  notes.
     Actual  results  could  differ  from those  estimates.  The  Company  makes
     significant  estimates,  including the allowance for doubtful  accounts and
     the  life  of the  excess  of  purchase  price  over  net  assets  acquired
     (goodwill) in both the IPI merger and the TouchSource  acquisition.  Due to
     the  uncertainties  inherent  in the  estimation  process,  it is at  least
     reasonably  possible  that the life of goodwill  could be revised  over the
     next year and such revisions could be material.

     New  Pronouncements  - Statement  of  Financial  Accounting  Standards  130
     Reporting  Comprehensive  Income  and  Statement  of  Financial  Accounting
     Standards  131  Disclosures  About  Segments of an  Enterprise  and Related
     Information were recently issued.  Statement 130 establishes  standards for
     reporting  and  display  of  comprehensive   income,   its  components  and
     accumulated  balances.  Comprehensive  income is  defined  to  include  all
     changes in equity except those  resulting  from  investments  by owners and
     distributions to owners.  Among other  disclosures,  Statement 130 requires
     that all components of  comprehensive  income shall be classified  based on
     their  nature and shall be  reported  in the  financial  statements  in the
     period in which  they are  recognized.  A total  amount  for  comprehensive
     income shall be displayed in the financial  statements where the components
     of other  comprehensive  income  are  reported.  Statement  131  supersedes
     Statement of Financial  Accounting  Standards  14 Financial  Reporting  for
     Segments of a Business Enterprise.  Statement 131 establishes  standards on
     the way that public companies report financial  information about operating
     segments in annual financial  statements and requires reporting of selected
     information about operating segments in interim financial statements issued
     to the public.  It also  establishes  standards for  disclosures  regarding
     products and services, geographic areas, and major customers. Statement 131
     defines operating  segments as components of a company about which separate
     financial information is available that is evaluated regularly by the chief
     operating  decisionmaker  in  deciding  how to  allocate  resources  and in
     assessing performance.

     Statements  130 and 131 are effective for financial  statements for periods
     beginning after December 15, 1997 and require  comparative  information for
     earlier  years to be  restated.  Because  of the recent  issuance  of these
     standards, management has been unable to fully evaluate the impact, if any,
     the  standards  may have on the  future  financial  statement  disclosures.
     Results of operations and financial position,  however,  will be unaffected
     by implementation of these standards.



                                       F-9

<PAGE>


                                  NAVIDEC, INC.

                          NOTES TO FINANCIAL STATEMENTS



2.   LIQUIDITY:
     ---------

     The  Company  has  incurred  net  losses  for the  past two  years  and has
     experienced  negative cash flows from  operations.  As described in Note 9,
     management  has taken the following  actions to improve the Company's  cash
     flow and operating results.

          o    In  February  1997,  the  Company  completed  an  initial  public
               offering  for the sale of its  common  stock and  warrants  which
               resulted in gross proceeds of approximately $4,555,000.

          o    The  Company  is  currently  in the  process  raising  additional
               capital in a private placement.

     The Company is also  aggressively  working to increase revenues and improve
     operating results to ultimately achieve profitability. No assurances can be
     given  that the  Company  will be  successful  in  completing  its  private
     offering or ultimately achieving profitability.


3.   ACQUISITION AND IMPAIRMENT OF IPI AND TOUCHSOURCE TECHNOLOGIES:
     --------------------------------------------------------------

     Effective July 1, 1996,  the Company  acquired 100% of the stock of IPI for
     679,000 shares of common stock of the Company and a $75,000 note payable in
     a  purchase  transaction.  The  acquisition  was  valued  at  approximately
     $750,000 and resulted in goodwill of approximately $850,000 being recorded.
     Projected  future  cash flows  associated  with the  technology  previously
     developed  by  IPI  declined  due  to  rapidly  changing  technologies  and
     increased  competition for products  developed with the IPI technology.  In
     addition,  during the fourth quarter of 1997, after the introduction of new
     Internet solutions by the Company,  management decided to focus the Company
     on its automotive  solution.  As such, the Company reevaluated the goodwill
     related to this acquisition and recorded an impairment expense of $598,000,
     resulting  in a  remaining  net  balance of  $20,000.  This  amount will be
     amortized over the next year.

     Effective  July  31,  1997,  the  Company  acquired  100% of the  stock  of
     TouchSource for 207,000 shares of common stock of the Company in a purchase
     transaction.  The  acquisition  was valued at  approximately  $776,000  and
     resulted in goodwill of approximately  $859,000 being recorded.  Subsequent
     to the  acquisition,  technologies  developed  more rapidly than  expected,
     which has  reduced  the  expected  future  cash flows  associated  with the
     TouchSource technology.  Furthermore,  the Company intends to integrate the
     TouchSource  technology  with its other products and market it primarily to
     the automotive  industry,  which was not a market focus of TouchSource.  As
     such, the Company also  reevaluated the related  goodwill,  and recorded an
     impairment  expense of $707,000,  resulting  in a remaining  net balance of
     $80,000. This amount is being amortized over the next year.


                                      F-10

<PAGE>


                                  NAVIDEC, INC.

                          NOTES TO FINANCIAL STATEMENTS



     The unaudited  following pro forma  information  presents the effect of the
     TouchSource merger as if it occurred on January 1, 1996.

                                                      For the Years Ended
                                                         December 31,
                                                 ------------------------------
                                                    1997               1996
                                                 -----------        -----------

            Revenue                              $ 6,362,000        $ 6,046,000
                                                 ===========        ===========

            Net loss                             $(4,377,000)       $(1,541,000)
                                                 ===========        ===========

            Loss per share                       $     (1.50)       $      (.72)
                                                 ===========        ===========

            Common share and
               equivalents outstanding             2,920,000          2,155,000
                                                 ===========        ===========



     The  above pro  forma  information  is not  necessarily  indicative  of the
     financial  results which would have occurred if such  acquisition had taken
     place at the earlier date, nor of future operating results.


4.   CONCENTRATION OF CREDIT RISK:
     ----------------------------

     Credit risk  represents the accounting loss that would be recognized at the
     reporting  date  if   counterparties   failed   completely  to  perform  as
     contracted. Concentrations of credit risk (whether on or off balance sheet)
     that arise from  financial  instruments  exist for groups of  customers  or
     counterparties when they have similar economic  characteristics  that would
     cause  their  ability  to  meet  contractual  obligations  to be  similarly
     effected by changes in economic or other  conditions  described  below. The
     Company  intends to market a  significant  portion of its  products  to the
     automotive  industry  in the  forthcoming  year.  This may  create a market
     concentration  in  future  years.  Sales  to this  industry  have  not been
     significant in the past.

     A geographic concentration exists because the Company has historically sold
     approximately  40% of its  products  and  services in the State of Colorado
     with  remaining  revenue  derived from sales  throughout the United States.
     Financial  instruments  that  subject the  Company to credit  risk  consist
     principally of accounts  receivable.  The Company performs  periodic credit
     evaluations on its customers' financial condition to reduce its exposure to
     credit risks.

     At  December  31,  1997,  the  Company  maintained  cash  balances  with  a
     commercial  bank,  which  were  approximately  $414,000  in  excess of FDIC
     insurance limits.

     The Company is dependent on four key  suppliers.  The Company has contracts
     with these suppliers, however, they are not exclusive and can be terminated
     at any time.  Management  believes  that  while the  Company  may  suffer a
     short-term  adverse  impact,  it would be able to  replace  anyone of these
     suppliers.



                                      F-11

<PAGE>


                                  NAVIDEC, INC.

                          NOTES TO FINANCIAL STATEMENTS



5.   CONTRACTS IN PROGRESS:
     ---------------------

     The following applies to contracts in progress as of December 31, 1997:

        Costs incurred on contracts in progress                      $   30,000
        Estimated earnings                                               76,000
                                                                     ----------
                                                                        106,000
        Less progress billings                                             --
                                                                     ----------

        Costs and estimated earnings in excess of billings           $  106,000
                                                                     ==========


6.   PROPERTY AND EQUIPMENT:
     ----------------------

     Property and equipment at December 31, 1997 consists of the following:

        Furniture, fixtures and equipment                            $1,036,000
        Leasehold improvements                                           41,000
                                                                     ----------
                                                                      1,077,000
        Less accumulated depreciation                                  (364,000)
                                                                     ----------
                                                                     $  713,000
                                                                     ==========


7.   NOTES PAYABLE:
     -------------

     Notes payable at December 31, 1997, consists of the following:

     Note payable,  financial institution,  due in
     monthly principal installments of $5,000 plus
     interest   at  prime  plus  1/4%   (8.75%  at
     December  31,  1997),   due  July  15,  2002,
     collateralized  by a certificate  of deposit.
     The loan agreement contains covenants, which,
     among other items, restricts the Company from
     incurring  certain  debt.  As of December 31,
     1997, the Company is in compliance with these
     covenants.                                                      $  275,000

     Other.                                                               3,000
                                                                     ----------
                                                                        278,000

     Less current portion                                               (63,000)
                                                                     ----------
                                                                     $  215,000
                                                                     ==========




                                      F-12

<PAGE>


                                  NAVIDEC, INC.

                          NOTES TO FINANCIAL STATEMENTS



8. COMMITMENTS AND CONTINGENCIES:

     Capital Lease  Obligations - The Company  leases  certain  equipment  under
     agreements  classified as capital leases.  Equipment under the leases has a
     cost  of   approximately   $174,000   and   accumulated   amortization   of
     approximately  $43,000. The following is a schedule of future minimum lease
     payments under capital leases at December 31, 1997.

        Future minimum lease payments                                 $ 177,000
        Less amount representing interest                               (45,000)
                                                                      ---------

        Present value of net minimum lease payments                     132,000

        Less current portion                                            (37,000)
                                                                      ---------
                                                                      $  95,000
                                                                      =========


     Office Leases - The Company leases its office space under operating  leases
     for a term expiring 2001. The lease calls for monthly  payments of $10,000.
     The aggregate minimum annual lease payments are as follows:

                                                                   Operating
        Year Ending December 31,                                     Leases
        ------------------------                                   ---------

                1998                                               $ 121,000
                1999                                                 111,000
                2000                                                 101,000
                2001                                                  42,000
                                                                   ---------

        Total minimum lease payments                               $ 375,000
                                                                   =========


     Receivables  Factored With Recourse - In 1997, the Company  entered into an
     agreement with a bank to factor,  with full  recourse,  existing and future
     accounts  receivable to a maximum of $750,000.  The Company must maintain a
     cash  reserve  account  with the bank of up to 20% of the  face  amount  of
     receivables sold to the bank. The Company's recourse  obligation is secured
     by all of the  Company's  assets and is  guaranteed by two of the Company's
     shareholders.  As of December  31,  1997,  the face  amount of  receivables
     factored was $249,000 resulting in a recourse  obligation of $190,000.  For
     financial  presentation  purposes,  the related  receivable and outstanding
     recourse   liability   have  been  included  as  an  asset  and  liability,
     respectively, on the balance sheet.


                                      F-13

<PAGE>


                                  NAVIDEC, INC.

                          NOTES TO FINANCIAL STATEMENTS



     Employment  Agreements - In July 1996, the Company  entered into employment
     agreements  with two  shareholders.  The  agreements  provide for  payments
     totaling  $165,000 per year through June 30, 1998 and include covenants not
     to compete during the term of employment and for one year thereafter.

     The Company  entered  into a service  agreement  with a  shareholder  which
     commenced on August 1, 1996, and was subsequently extended through February
     1999. The agreement provides for payments of approximately $5,000 per month
     plus options to purchase  212,500  shares of the Company's  common stock at
     $4.12 per share.  The  options are  exercisable  from April 1999 to October
     2001. The agreement also contains a covenant not to compete during the term
     of the service  agreement  and for one year  thereafter.  During 1997,  the
     Company  loaned  $60,000  to  this  shareholder  at 5.5%  interest,  due in
     semi-monthly   installments   of  $2,300   beginning   January   1,   1998,
     collateralized by the options discussed above.

     In April 1997,  the Company  entered into an additional  service  agreement
     with this shareholder.  This agreement provides for additional  payments of
     $5,000  per  month  plus 2 1/2% of any  capital  raised  as a result of the
     shareholder's efforts in the form of options and warrants for the Company's
     stock.  These  options  shall be  exercisable  at the closing  price of the
     Company's  stock on the date of  closing  of any  transaction,  exercisable
     commencing  six months after each grant and expire five years from the date
     of each grant.  The  agreement  expired on October 1, 1997.  As a result of
     this agreement, 4,717 warrants are outstanding at December 31, 1997.


9.   STOCKHOLDERS' EQUITY (DEFICIT):
     ------------------------------

     Termination of  S-Corporation  Status - Effective July 1, 1996, the Company
     terminated  its  S-Corporation  status  and  became a  C-Corporation.  As a
     result, the Company  reclassified its accumulated  deficit  attributable to
     the  S-Corporation  as a  reduction  in common  stock upon  termination  of
     S-Corporation status.

     Public Stock Offering - In February 1997, the Company  completed an initial
     public stock offering of 1,000,000 Units  (comprised of 1,000,000 shares of
     common stock and  warrants  for the purchase of 1,000,000  shares of common
     stock)  which  provided  gross  proceeds  to the  Company of  approximately
     $4,555,000. Included in the 1,000,000 shares were 245,000 shares offered by
     the holders of unsecured  subordinated  convertible  promissory notes. Each
     warrant  allows  the  holder to  purchase  one share of common  stock at an
     exercise price of $7.20 through  February 2002. The warrants are redeemable
     by the Company at $.05 per warrant  upon 30 days notice if the market price
     of the  common  stock for 20  consecutive  trading  days  within the 30-day
     period  preceding the date the notice is given equals or exceeds $8.40. The
     Company also sold to the  underwriter  at the close of the public  offering
     underwriters  warrants,  at a price of  $0.001  per  warrant,  to  purchase
     100,000 shares of common stock. The  underwriters  warrants are exercisable
     for 4 years beginning in February 1998 at $7.38 per share.


                                      F-14

<PAGE>


                                  NAVIDEC, INC.

                          NOTES TO FINANCIAL STATEMENTS



     Private Placement - The Company is raising  additional capital in a private
     placement. The offering provides for a maximum amount of $2,500,000 with no
     minimum,  consisting of a maximum of 555,555 units  (comprised of one share
     of common stock and one warrant) at $4.50 per unit. Each warrant allows the
     holder to purchase one share of common stock at an exercise  price of $7.20
     for a  period  extending  through  February  10,  2002.  The  warrants  are
     redeemable  by the Company at $.05 per  warrant  upon 30 days notice if the
     market  price for 20  consecutive  trading  days  within the 30-day  period
     preceding the date the notice is given equals or exceeds $8.40. The Company
     is required by the terms of the placement  agreement to register the common
     shares and the common  shares  underlying  the  warrants  within 45 days of
     filing the Company's  10-KSB.  Offering costs  associated  with the private
     placement  include  underwriter  commissions  and  non-accountable  expense
     allowances totaling 13% of proceeds, as well as placement agent warrants to
     purchase  10% of the units  sold for 5 years  from the date of  closing  at
     $4.50 per unit. In addition,  the Company has agreed to issue any broker or
     registered  agent who places four or more  placement  units  (consisting of
     6,000  units or  $27,000  each) one broker  warrant  for each $20 sold at a
     price of $4.50.  As of December 31,  1997,  the Company had closings on the
     private  placement  of  $717,000  net of  offering  costs of  $132,000.  No
     warrants  had been issued to brokers or  registered  representatives  as of
     December 31, 1997.

     Through March 5, 1998, the Company completed two additional closings on the
     private  placement  for a total of  45,000  units,  receiving  proceeds  of
     $176,000 net of offering costs of $27,000.

     Stock Split - During  1996,  the Company  declared a 1 for 2 reverse  stock
     split and 510.2041 for 1 stock split. The Company also declared a .85 for 1
     reverse stock split to be effective immediately prior to the initial public
     offering.   Accordingly,  all  common  stock  reflected  in  the  financial
     statements  and  accompanying  notes  reflect  the  effect of the split and
     reverse splits.

     Common  Stock  Transfers  and  Options - In June  1996,  an  officer  and a
     shareholder  transferred  83,725  shares of common stock to employees at no
     cost. The Company  recognized  $83,000 in  compensation  expense related to
     this transfer.

     During 1994 and 1993,  the Company  issued stock  options to an officer and
     shareholder  to purchase  804,881  shares of common  stock at an  aggregate
     exercise price of $1,745. During June 1996, these options were exercised.

     Pro Forma  Stock-Based  Compensation  Disclosures - The Company applies APB
     Opinion 25 and related  interpretations  in  accounting  for stock  options
     granted to employees and directors.  Accordingly,  no compensation cost has
     been recorded for grants of options to employees  and  directors  where the
     exercise  price is not less  than the fair  market  value of the  Company's


                                      F-15

<PAGE>


                                  NAVIDEC, INC.

                          NOTES TO FINANCIAL STATEMENTS


     common stock on the measurement date. Had compensation cost been determined
     using the fair value method pursuant to FAS 123, the Company's net loss and
     net loss per share would have increased to the pro forma amounts  indicated
     in the following table:

                                                      Year Ended June 30,
                                                  ----------------------------
                                                      1997             1996
                                                  ------------     -----------
        Net loss
         As reported                              $(4,107,000)     $(1,415,000)
         Pro forma                                 (2,721,000)      (1,415,000)


        Net loss per common share
         As reported                              $     (1.47)     $      (.73)
         Pro forma                                      (1.51)            (.73)



     The fair value of all options granted was estimated as of the date of grant
     using the Black-Scholes  option pricing model using the following  weighted
     average assumptions:

                                                       Year Ended June 30,
                                                  ----------------------------
                                                      1997             1996
                                                  -----------      -----------

        Estimated fair value per option               $4.33           $ -
        Expected volatility                            104%             - %
        Risk-free interest rate                        5.5%            6.5%
        Expected dividends                              -               -
        Expected term (in years)                       4.4             3.5



10.  INCOME TAXES:
     ------------

     As of  December  31,  1997,  the  Company  has a net  operating  loss (NOL)
     carryforward for tax reporting purposes of approximately  $3,750,000.  This
     NOL expires in the years 2011 through 2017.

     Deferred income taxes are provided for differences between the tax and book
     basis of assets and liabilities as a result of temporary differences in the
     recognition  of  revenues  or  expenses  for  tax and  financial  reporting
     purposes, which relates primarily to certain items not currently deductible
     for tax purposes until paid.


                                      F-16

<PAGE>


                                  NAVIDEC, INC.

                          NOTES TO FINANCIAL STATEMENTS



     Deferred tax assets (liabilities)  resulting from these differences consist
     of the following:

        Net operating loss carryforward                            $ 1,398,000
        Other                                                          (30,000)
                                                                   -----------
             Total                                                   1,368,000
        Less valuation allowance                                    (1,368,000)
                                                                   -----------

        Net deferred tax asset                                     $      --
                                                                   ===========

     The valuation  allowance for deferred tax assets increased from $236,000 at
     December 31, 1996 to $1,330,000  at December 31, 1997,  due primarily to an
     increase in the Company NOL carryforwards.


11.   DEFINED CONTRIBUTION PLAN:
      -------------------------

     The Company has a 401(k) profit sharing plan (the Plan). Eligible employees
     may make  voluntary  contributions  to the Plan.  The  amount  of  employee
     contributions  is limited as specified in the Plan. The Company may, at its
     discretion,  make additional contributions to the Plan. The Company made no
     contributions in 1997 and 1996.





                                      F-17





<PAGE>


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

None.

ITEM 9.   MANAGEMENT

The information required by this Item is incorporated herein by reference to the
Company's 1998 Annual Meeting Proxy Statement under the caption ".

ITEM 10.  EXECUTIVE COMPENSATION

The  information  required by this Item is  incorporated  by reference  from the
Company's Proxy Statement.

ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The  information  required by this Item is  incorporated  by reference  from the
Company's Proxy Statement.

ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The  information  required by this Item is  incorporated  by reference  from the
Company's Proxy Statement.

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

Exhibit
Number    Description
------    -----------


 1.1       Form of Underwriting Agreement                                  *
 1.2       Form of Selected Dealers Agreement                              *
 1.3       Warrant Exercise Fee Agreement                                  *
 3.1       Amended and Restated Articles of Incorporation of ACI           *
           Systems, Inc.
 3.2       Amended and Restated Bylaws of ACI Systems, Inc.                *
 3.3       Articles of Merger and Agreement and Plan of Merger             *
           Between ACI Systems, Inc.
           and Interactive Planet, Inc.
 4.1       Form of Certificate for Common Stock of NAVIDEC, Inc.           *
 4.2       Form of Warrant                                                 *
 4.3       Form of Warrant Agreement                                       *
 4.4       Form of Representative's Option Agreement                       *
 4.5       Form of Private Placement Financing Converted Units             *
           Registration Rights Agreement
 4.6       Form of 10% Unsecured Subordinated Convertible                  *
           Promissory Note
 4.7       Form of Placement Agent's Warrant Registration Rights           *
           Agreement [Rescinded]
 4.8       Form of Placement Agent's Warrant for the Purchase of           *
           Shares of Common Stock and Warrants [Rescinded]
 5.1       Opinion, with Consent, of Cohen Brame & Smith                   *
           Professional Corporation
<PAGE>




10.1       Form of "Lock Up" Letter to be entered into by the              *
           Company's current shareholders
10.2       Form of Shareholders' Agreement dated July 12, 1996,            *
           among NAVIDEC, Inc. and its shareholders on such date.
10.3       Form of Confidentiality and Non-Disclosure Agreement            *
           between the Company and its significant technical
           employees
10.4       Employment Agreement dated July 3, 1996 between                 *
           NAVIDEC, Inc. and Ralph Armijo
10.5       Employment Agreement between NAVIDEC, Inc. and                  *
           John R. McKowen
10.6       Lease Agreement dated February 23, 1996 for the                 *
           premises located at 14 Inverness Dr., Building F, Suite
           116, Englewood, Colorado  80112
10.7       Lease Agreement dated October 27, 1993 for the premises         *
           located at 7002 S. Revere Parkway, Suite 40, Englewood,
           Colorado  80112 [Terminated in December 1996]
10.8       Promissory Note as of October 1, 1993, in the principal         *
           amount of $119,199, from ACI Systems, Inc. payable to
           Arthur Armijo
10.9       Promissory Note as of March 31, 1996, in the principal          *
           amount of $45,110 from Interactive Planet, Inc. payable
           to Patrick Mawhinney
 10.10     Promissory Note as of July 9, 1996, in the principal            *
           amount of $75,000 from NAVIDEC, Inc. payable to Cynthia
           Simmons
10.11      Business/Manager Agreement and Commercial Security              *
           Agreement, each dated February 27, 1996, between
           NAVIDEC, Inc. and Colorado State Bank of Denver
10.12      Form of Commercial Guarantee of Ralph Armijo and Arthur         *
           Armijo in favor of Colorado State Bank of Denver in
           connection with February 27, 1996 Promissory Note
10.13      Form of Commercial Continuing Guarantee of Ralph Armijo         *
           and Arthur Armijo dated November 17, 1993 in favor of
           Vectra Bank in connection with line of credit
           terminated in February 1996
10.14      Promissory Note as of August 6, 1996, in the principal          *
           amount of $70,000 from NAVIDEC, INC. payable to Ralph
           Armijo
10.15      Promissory Note as of July 26, 1996 in the principal            *
           amount of $30,000 from NAVIDEC, INC. payable to Patrick
           Mawhinney
10.16      Promissory Note as of July 25, 1996, in the principal           *
           amount of $182,500 from NAVIDEC, INC. payable to Little
           Land Company
10.17      Netscape Commercial Applications Partner Program                *
           (NCAPP) Guidelines
10.18      Form of Restated Agreement Not to Sell with Bridge              *
           Financing Selling Stockholders
10.19      Form of Insider's Lock-up Agreement to be entered into          *
           by the Company's officers, directors and 5%
           shareholders
10.20      Form of Promissory Note in the principal amount of              *
           $70,000 from NAVIDEC, Inc. payable to Trust Company of
           America FBO Michael Hendricks SEP IRA and guaranteed by
           Ralph Armijo and Patrick Mawhinney

<PAGE>

10.21      Wheels licence agreement with the Denver Post        Filled Here With
10.22      Wheels licence agreement with KOIN TV                Filled Here With
21.1       Subsidiaries of the Registrant                                  *
23.1       Consent of Hein + Associates LLP                                *
23.2       Consent of Cohen Brame & Smith Professional Corporation         *
           (included in Exhibit 5.1)
23.3       Consent of Lloyd G. Chavez, Jr.                                 *
24.1       Power of Attorney with respect to certain signatures
           in the Registration statement (see signature page to
           Registration Statement)
27         Financial Data Schedule                                         *


*    All exhibits are incorporated by reference to like numbered exhibits to the
     Company's  Registration  Statement on Form SB-2 declared effective February
     10, 1997 (SEC File Number 333-14497).