SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 FORM 20-F
 o
    
    Registration statement pursuant to Section 12(b) or 12(g) of the Securities Exchange Act of
1934
 OR
 þ
    
    Annual report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For
the fiscal year ended September 30, 2008
 OR
 o
    
    Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the transition period from  to
 OR
 o
    
    Shell company report pursuant to Section 13 or 15 (d) of the Securities Exchange Act of 1934
 Date of event requiring this shell company report
 Commission file number 0-30082
 ENVOY CAPITAL GROUP INC.
  
 
  
  
    
  
   
  At September 30, 2008, there
were 8,585,636 common shares outstanding
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TABLE OF CONTENTS
 PART IItem 1.
    
    Identity of Directors, Senior Management and Advisers
    
    
    4Item 2.
    
    Offer Statistics and Expected Timetable
    
    
    4Item 3.
    
    Key Information
    
    
    4Item 4.
    
    Information on the Company
    
    
    11Item 4A.
    
    Unresolved Staff Comments
    
    
    15Item 5.
    
    Operating and Financial Review and Prospects
    
    
    15Item 6.
    
    Directors, Senior Management and Employees
    
    
    35Item 7.
    
    Major Shareholders and Related Party Transactions
    
    
    47Item 8.
    
    Financial Information
    
    
    50Item 9.
    
    The Offer and Listing
    
    
    50Item 10.
    
    Additional Information
    
    
    52Item 11.
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    62Item 12.
    
    Description of Securities Other than Equity Securities
    
    
    64PART IIItem 13.
    
    Defaults, Dividend Arrearages and Delinquencies
    
    
    64Item 14.
    
    Material Modifications to the Rights of Security Holders and Use of Proceeds
    
    
    64Item 15.
    
    Controls and Procedures
    
    
    64Item l6A
    
    Audit Committee Financial Expert
    
    
    65Item l6B
    
    Code of Ethics
    
    
    66Item l6C
    
    Principal Accountant Fees and Services
    
    
    67Item 16D
    
    Exemptions from the Listing Standards for Audit Committees
    
    
    67Item 16E
    
    Purchase of Equity Securities by the Issuer and Affiliated Purchases
    
    
    68PART IIIItem 17.
    
    Financial Statements
    
    
    69Item 18.
    
    Financial Statements
    
    
    69Item 19.
    
    Exhibits
    
    
    70Signatures
    
    
    
    
    71Certifications
    
    
    
    
    72Exhibit Index
    
    
    
    
    70
 2




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##### 



Special Note Regarding Forward-Looking Statements
  3




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##### 



PART I
 Item 1: Identity of Directors, Senior Management and Advisers
  Item 2: Offer Statistics and Expected Timetable
  Item 3: Key Information
 A. Selected Financial Data 1
  Fiscal Years EndedSeptember 30
    
    2008
    
    
    2007
    
    
    2006(2)
    
    
    2005(3)
    
    
    2004(4)(all amounts in thousands exceptper share data)Statement of Operations Data:Net Revenue
    
    $
    11,260
    
    
    $
    17,551
    
    
    $
    9,672
    
    
    $
    19,567
    
    
    $
    15,838(Loss) Earnings From Continuing
Operations(5)
    
    
    (10,158
    )
    
    
    2,641
    
    
    
    (5,392
    )
    
    
    3,074
    
    
    
    (4,781
    )Earnings From
Discontinued Operations
    
    
    
    
    
    
    375
    
    
    
    7,528
    
    
    
    2,868
    
    
    
    1,674(Loss) Earnings From
Continuing Operations Basic
Earnings Per Share
    
    
    (1.11
    )
    
    
    0.20
    
    
    
    (0.27
    )
    
    
    0.14
    
    
    
    (0.28
    )Earnings (Loss) From
Continuing Operations
Diluted Earnings Per Share
    
    
    (1.11
    )
    
    
    0.20
    
    
    
    (0.27
    )
    
    
    0.14
    
    
    
    (0.28
    )Net (Loss) Earnings(5)
    
    
    (10,158
    )
    
    
    3,017
    
    
    
    2,136
    
    
    
    5,942
    
    
    
    (3,106
    )Net (Loss) Earnings Per
Share Basic
    
    
    (1.11
    )
    
    
    0.23
    
    
    
    0.10
    
    
    
    0.27
    
    
    
    (0.18
    )Net Earnings (Loss) Earnings
Per Share Diluted(5)
    
    
    (1.11
    )
    
    
    0.23
    
    
    
    0.10
    
    
    
    0.27
    
    
    
    (0.18
    )
 4




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##### 



1
    
    The Consolidated Financial Statements of Envoy have been prepared by management in accordance with
Canadian Generally Accepted Accounting Principles (Canadian GAAP) which vary in certain
significant respects from U.S. Generally Accepted Accounting Principles (U.S. GAAP).
Reconciliation to U.S. GAAP for fiscal 2008, 2007 and 2006 is set forth in Note 22 to the Notes to
the Consolidated Financial Statements. The fol1owing would be the adjustments under U.S. GAAP to
the information provided above as an increase (decrease) to: Net Revenue 2008 $4,255, 2007
($5,148), 2006 $nil, 2005 $nil and 2004 $nil; Earnings (loss) from continuing operations 2008
$1,686, 2007 ($1,240), 2006 $nil, 2005 $344 and 2004 ($464); Earnings (loss) from continuing
operations earnings per share basic 2008 $0.18, 2007 ($0.09), 2006 $nil, 2005 $0.01 and 2004
($0.03); Earnings (loss) from continuing
operations earnings per share diluted 2008 $0.18, 2007 ($0.09), 2006 $nil, 2005 $0.01 and 2004
($0.03); Net earnings (loss) 2008 $4,490, 2007 ($1,240), 2006 ($2,700), 2005 $344 and 2004 $(464);
and Net earnings (loss) per share basic 2008 $0.49, 2007 ($0.09), 2006 ($0.13), 2005 $0.01 and 2004
$(0.03); Net earnings (loss) per share diluted 2008 $0.49, 2007 ($0.09), 2006 ($0.13), 2005 $0.01
and 2004 $(0.03).  As at September 30
    
    2008
    
    
    2007
    
    
    2006(2)
    
    
    2005(3)
    
    
    2004(4)(all amounts in thousands)Balance Sheet Data:Current Assets
    
    $
    28,823
    
    
    $
    38,832
    
    
    $
    68,701
    
    
    $
    44,759
    
    
    $
    59,432Total Assets(7)
    
    
    36,482
    
    
    
    50,792
    
    
    
    81,274
    
    
    
    84,057
    
    
    
    88,880Total Debt(6)
    
    
    70
    
    
    
    157
    
    
    
    252
    
    
    
    361
    
    
    
    659Shareholders
Equity(7)
    
    
    32,159
    
    
    
    45,157
    
    
    
    75,047
    
    
    
    73,555
    
    
    
    76,891Retained (Deficit)
Earnings(8)
    
    
    (7,064
    )
    
    
    3,094
    
    
    
    (40,266
    )
    
    
    (42,403
    )
    
    
    (48,344
    )
 2
    
    The exchange rate utilized with respect to the Statement of Operations Data for the
fiscal year ended September 30, 2006 of Watt Gilchrist Limited (Gilchrist) and Parker Williams
Design Limited (PWD) is £1.00 to $2.0571 and with respect to the Balance Sheet Data of Gilchrist
and PWD is £1.00 to $2.1044. Except
as set forth in footnotes 5, 6 and 7, no other acquisitions by Envoy materially affect the
comparability of the information in the Selected Financial Data.3
    
    The exchange rate utilized with respect to the Statement of Operations Data for the
fiscal year ended September 30, 2005 of Watt Gilchrist Limited (Gilchrist) is £1.00 to $2.2641
and with respect to the Balance Sheet Data of Gilchrist is £1.00 to $2.0648. The exchange rate
utilized with respect to the Statements of Operations Data for the fiscal year ended September
 5




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##### 



30,
2005 of Parker Williams Design Limited (PWD) is £1.00 to $2.2428. The exchange rate utilized with
respect to the Balance Sheet Data of PWD is £1.00 to $2.0648. Except as set forth in footnotes 5, 6
and 7, no other acquisitions by Envoy materially affect the comparability of the information in the
Selected Financial Data.4
    
    The exchange rate utilized with respect to the Statement of Operations Data for the
fiscal year ended September 30, 2004 of Gilchrist is £1.00 to $2.3759 and with respect to the
Balance Sheet Data of Gilchrist is £1.00 to $2.2878. Except as set forth in footnotes 5, 6 and 7,
no other acquisitions by Envoy materially affect the comparability of the information in the
Selected Financial Data.5
    
    As reflected in Note 22 to the Consolidated Financial Statements, the net (loss)
earnings from continuing operations for the fiscal years ended September 30, 2008, 2007, 2006, 2005
and 2004 were ($8,472), $1,401, ($5,392), $3,418 and ($5,245), respectively under U.S. GAAP. The
net (loss) earnings for the fiscal years ended September 30, 2008, 2007, 2006, 2005 and 2004 were
($5,668), $1,777, ($564), $6,286 and ($3,571), respectively under U.S. GAAP. The diluted net (loss)
earnings per share for the years ended September 30, 2008, 2007, 2006, 2005 and 2004 were ($0.62),
$0.14, ($0.03), $0.28 and ($0.21), respectively under U.S. GAAP.As described above, on January 21, 2005, Envoy filed Articles of Amendment consolidating its common
shares on the basis of 1 new common share for every 5 common shares outstanding. Outstanding shares
and earnings per share figures for all periods presented have been adjusted to give effect to the
share consolidation.6
    
    Total debt includes both the current and long term portion of debt.7
    
    As reflected in Note 22 to the Consolidated Financial Statements, the shareholders
equity as at September 30, 2008, 2007, 2006, 2005 and 2004 was $32,589, $41,140, $72,589, $73,550
and $77,066, respectively under U.S. GAAP. Total assets as of September 30, 2008 under U.S. GAAP
would exclude fair value adjustments of $472. In addition, total assets as of September 30, 2007,
2006, 2005 and 2004 under U.S. GAAP would include the unrealized gain on private equities of
$1,147, $nil, $nil and $nil, respectively, include the unrealized gain (loss) on securities for
sale of $nil, $242, ($6) and $174, respectively, exclude capitalized incorporation costs of $66,
$nil, $nil, and $nil, respectively, and it would exclude cash held in escrow relating to the sale
of the UK operations of $2,803, $2,700, $nil and $nil, respectively.8
    
    Retained earnings as of September 30, 2008, 2007, 2006, 2005 and 2004,excludes the
cumulative foreign currency translation adjustment of $nil, ($77), ($51), ($2,153) and 74,
respectively. See Note 2(f) in the Notes to Consolidated Financial Statements of Envoy.  6




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##### 



Exchange Rates:
  Fiscal Year Ended September 30,
 2008
    
    2007
    
    2006
    
    2005
    
    2004Average *
    
    $
    1.0101
    
    
    $
    1.0885
    
    
    $
    1.1151
    
    
    $
    1.2171
    
    
    $
    1.2034
 
 *
    
    The Average rate means the average rates each period, calculated by using the average of the
exchange rates on the last day of each month during the fiscal period. For the Month Ended
 November
    
    October
    
    September
    
    August
    
    July
    
    June2008
    
    2008
    
    2008
    
    2008
    
    2008
    
    2008High
    
    $
    1.2952
    
    
    $
    1.2995
    
    
    $
    1.0821
    
    
    $
    1.0716
    
    
    $
    1.0274
    
    
    $
    1.0320Low
    
    $
    1.1477
    
    
    $
    1.0585
    
    
    $
    1.0298
    
    
    $
    1.0237
    
    
    $
    0.9975
    
    
    $
    0.9948
 B. Capitalization and Indebtedness
  C. Reasons for the Offer and Use of Proceeds
  D. Risk Factors
 Envoys business, financial condition and results of operations could be materially adversely
affected by any of the following risks. In addition, risk and uncertainties not currently known to
the Company or that the Company currently deems to be immaterial may also materially and adversely
affect its business.
 Risks Related to Envoys Business and Industry
 The Company has a limited number of large clients.
   7




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##### 



Fiscal Year Ended September 30, 2008
 Client
 The Great Atlantic and Pacific Company
    
    
    22
    %Dubai Maritime City Retail Development LLC
    
    
    19
    %McDonalds Restaurants of Canada Limited
    
    
    15
    %Meijer, Inc.
    
    
    12
    %Wal-Mart Canada Corp.
    
    
    10
    %
   The Company is dependent on its key personnel.
  The Company is exposed to the risks of doing business internationally.
  
    
    currency exchange rate fluctuations;
    
    restrictions on repatriation of earnings; and
    
    changes in the political or economic conditions of a specific country or region, particularly
in emerging markets.
  Currency exchange rate fluctuations could adversely affect the Companys results of operations.
  Market rate fluctuations could adversely affect the Companys results of operations.
  8




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##### 



The Company may be unsuccessful in evaluating material risks involved in completed and future
investments.
  The Company is subject to credit risk.
   The Company may need to raise additional capital to grow its business, which it may not be able to
do.
   9




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##### 



The Company is subject to recessionary economic cycles.
  The Company may be subject to certain regulations that could restrict the Companys activities.
 Government Regulations
 The Company competes for clients in a highly competitive industry, which may reduce market share
and decrease profits.
  Risks related to the Companys common shares
 Because the Company is a Canadian company, it may be difficult to enforce liabilities against the
Company based solely upon the federal securities laws of the United States.
  10




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##### 



The Company believes that it is a Passive Foreign Investment Company, which may have adverse tax
consequences for the Companys shareholders in the United States.
  Item 4: Information on the Company
        A. History and Development of the Company
  11




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##### 



B. Business Overview
 Services in the Envoy Group:
    Our Strategic Direction:
  12




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##### 



Industry Overview:
 Consumer and Retail Branding
     13




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##### 



Government Regulations:
  Merchant Banking
    Government Regulations:
  C. Organizational Structure
  14




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##### 



D. Property, Plants and Equipment
     Item 4A: Unresolved Staff Comments
  Item 5: Operating and Financial Review and Prospects
 The following discussion should be read in conjunction with, and is qualified in its entirety by,
the Consolidated Financial Statements of Envoy and the Notes relating thereto, included as item 17
in this Form 20-F . The information contained in this Item 5 refers to Financial Statements of
Envoy, which are presented in Canadian dollars and are prepared in accordance with Canadian GAAP.
 Canadian GAAP differs in certain significant respects from U.S. GAAP. Reconciliation to U.S. GAAP
is set forth in Note 22 of the Notes to Consolidated Financial Statements. Historical results of
operations, percentage relationships and any trends that may be inferred there from are not
necessarily indicative of the operating results of any future period.
 Overview
 Net Revenue
  (i)
    
    deferred revenue representing fees billed and collected in advance of such fees being earned;
 15




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(ii)
    
    unbilled accounts receivable representing fees earned but not yet billed as well as well as
reimbursable pass-through costs; and
 (iii)
    
    work in process represents costs incurred on projects for which revenue has not yet been
recognized for accounting purposes.
    Operating Expenses
  Tax Matters
  A. Operating Results
   16




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17




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SELECTED ANNUAL INFORMATION
 Fiscal 2008
    
    
    Fiscal 2007
    
    
    Fiscal 2006Net revenue
    
    $
    11.3 million
    
    
    $
    17.6 million
    
    
    $
    9.7 millionNet (loss) earnings:From continuing operations
    
    
    (10.2) million
    
    
    
    2.6 million
    
    
    
    (5.4) millionFrom discontinued operations
    
    
    
    
    
    
    0.4 million
    
    
    
    7.5 millionTotal
    
    
    (10.2) million
    
    
    
    3.0 million
    
    
    
    2.1 millionNet (loss) earnings per shareTotalBasic
    
    $
    (1.11
    )
    
    $
    0.23
    
    
    $
    0.10Diluted
    
    $
    (1.11
    )
    
    $
    0.23
    
    
    $
    0.10From continuing
operationsBasic
    
    $
    (1.11
    )
    
    $
    0.20
    
    
    $
    (0.27
    )Diluted
    
    $
    (1.11
    )
    
    $
    0.20
    
    
    $
    (0.27
    )From discontinued
operationsBasic
    
    $
    nil
    
    
    $
    0.03
    
    
    $
    0.37Diluted
    
    $
    nil
    
    
    $
    0.03
    
    
    $
    0.37
 As at:
    
    Sep 30, 2008
    
    
    Sep 30, 2007
    
    
    Sep 30, 2006Total assets
    
    $
   36.5 million
    
   
    $
    50.8 million
    
    
    $
    81.3 millionTotal long-term financial liabilities
    
    $
    nil
    
    
    $
    0.1 million
    
    
    $
    0.2 millionCash dividends declared
    
    $

    nil
    
    
    $

    nil
    
    
    $

    nil
 18




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##### 



FISCAL YEAR ENDED SEPTEMBER 30, 2008, COMPARED TO FISCAL YEAR ENDED SEPTEMBER 30, 2007
   Consumer and Retail Branding Segment
   Net revenue for the year ended September 30(in millions)2008
    
    
    % of total
    
    
    2007
    
    
    % of totalBy customer location:USA and South America
    
    $
    6.4
    
    
    
    41
    %
    
    $
    6.4
    
    
    
    52
    %Canada
    
    
    5.3
    
    
    
    34
    %
    
    
    4.1
    
    
    
    33
    %Middle East and Asia
    
    
    3.8
    
    
    
    25
    %
    
    
    1.9
    
    
    
    15
    %$
    15.5
    
    
    
    100
    %
    
    $
    12.4
    
    
    
    100
    %
    19




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##### 



Merchant Banking Segment
   20




---



##### 



Corporate
   21




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##### 



Income Taxes
  Income from discontinued operations
   Fiscal year:
    
    2008
    
    
    2007
    
    
    2006Net revenue
    
    $
    
    
    
    $
    
    
    
    $
    21,432,172Operating expenses
    
    
    
    
    
    
    
    
    
    
    17,460,973Interest income
    
    
    
    
    
    
    
    
    
    
    (60,327
    )Depreciation
    
    
    
    
    
    
    
    
    
    
    1,294,822Income tax expense
    
    
    
    
    
    
    
    
    
    
    582,122Earnings from discontinued operations
(excluding gain on sale)
    
    
    
    
    
    
    
    
    
    
    2,154,582Minority interest
    
    
    
    
    
    
    
    
    
    
    347,599Gain on sale of discontinued operations
    
    
    
    
    
    
    375,514
    
    
    
    5,721,229Earnings from discontinued operations
    
    $
    
    
    
    $
    375,514
    
    
    $
    7,528,212
 Net earnings (loss)
   22




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##### 



THREE MONTHS ENDED SEPTEMBER 30, 2008, COMPARED TO THREE MONTHS ENDED SEPTEMBER 30, 2007
   Consumer and Retail Branding Segment
   Net revenue for the three months ended September 30(in millions)2008
    
    
    % of total
    
    
    2007
    
    
    % of totalBy customer location:USA and South America
    
    $
    1.5
    
    
    
    44
    %
    
    $
    2.2
    
    
    
    65
    %Canada
    
    
    1.3
    
    
    
    37
    %
    
    
    0.9
    
    
    
    26
    %Middle East and Asia
    
    
    0.7
    
    
    
    19
    %
    
    
    0.3
    
    
    
    9
    %$
    3.5
    
    
    
    100
    %
    
    $
    3.4
    
    
    
    100
    %
     23




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##### 



Merchant Banking Segment
    Corporate
  24




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##### 



Income Taxes
  Income from discontinued operations
  Net (loss) earnings
  25




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##### 



SUMMARY OF QUARTERLY RESULTS
 Q4 2008
    
    
    Q3 2008
    
    
    Q2 2008
    
    
    Q1 2008Net revenue
    
    
    ($0.3) million
    
    
   $
    3.5 million
    

    
    $

    3.3 million
    

    
    $
    4.7 millionNet earnings (loss):From continuing
operations
    
    
    ($8.25) million
    
    
    
    ($1.28) million
    
    
    
    ($0.98) million
    
    
    
    $0.36 millionIncluding
discontinued
operations
    
    
    ($8.25) million
    
    
    
    ($1.28) million
    
    
    
    ($0.98) million
    
    
    
    $0.36 millionNet earnings per shareFrom continuing
operationsBasic
    
    
    ($0.95
    )
    
    
    ($0.14
    )
    
    
    ($0.10
    )
    
    $
    0.04Diluted
    
    
    ($0.95
    )
    
    
    ($0.14
    )
    
    
    ($0.10
    )
    
    $
    0.04Including
discontinued
operationsBasic
    
    
    ($0.95
    )
    
    
    ($0.14
    )
    
    
    ($0.10
    )
    
    $
    0.04Diluted
    
    
    ($0.95
    )
    
    
    ($0.14
    )
    
    
    ($0.10
    )
    
    $
    0.04
 Q4 2007
    
    
    Q3 2007
    
    
    Q2 2007
    
    
    Q1 2007Net revenue
    
    $
    4.5 million
    
    
    $
    4.3 million
    

    
    $
    3.8 million
    

    
    $
    5.0 millionNet earnings (loss):From continuing
operations
    
    
    ($0.01) million
    
    
    $
    0.20 million
    
    
    $
    0.86 million
    
    
    $
    1.59 millionIncluding
discontinued
operations
    
    $
    0.36 million
    
    
    $
    0.20 million
    

    
    $
    0.86 million
    

    
    $
    1.59 millionNet earnings (loss)
per shareFrom
continuing
operationsBasic
    
    $
    0.00
    
    
    $
    0.02
    
    
    $
    0.07
    
    
    $
    0.08Diluted
    
    $
    0.00
    
    
    $
    0.02
    
    
    $
    0.07
    
    
    $
    0.08Including
discontinued
operationsBasic
    
    $
    0.04
    
    
    $
    0.02
    
    
    $
    0.07
    
    
    $
    0.08Diluted
    
    $
    0.04
    
    
    $
    0.02
    
    
    $
    0.07
    
    
    $
    0.08
 26




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##### 



RECONCILIATION TO U.S. GENERALLY ACCEPTED ACCOUNTING PRINCIPLES
  2008
    
    
    2007
    
    
    2006Net (loss) earnings  Canadian GAAP
    
    $
    (10,158,145
    )
    
    $
    3,016,719
    
    
    $
    2,136,186Cash held in escrow 22(a)
    
    
    2,803,549
    
    
    
    (103,549
    )
    
    
    (2,700,000
    )Capitalized incorporation costs 22(f)
    
    
    66,339
    
    
    
    (66,339
    )
    
    
    Income recognized on reclassification
of investments 22(g)
    
    
    
    
    
    
    77,416
    
    
    
    Gains on privately-held securities 22(g)
    
    
    
    
    
    
    (1,147,500
    )
    
    
    Fair value adjustment on restricted
securities 22(g)
    
    
    1,619,615
    
    
    
    
    
    
    
    Net (loss) earnings based on
U.S. GAAP
    
    $
    (5,668,642
    )
    
    $
    1,776,747
    
    
    $
    (563,814
    )Net (loss) earnings from continuing
operations
    
    $
    (8,472,191
    )
    
    $
    1,401,233
    
    
    $
    (5,392,026
    )Net earnings from discontinued
operations (Notes 21)
    
    $
    2,803,549
    
    
    $
    375,514
    
    
    $
    4,828,212
  2008
    
    
    2007Total assets based on Canadian GAAP
    
    $
    36,482,044
    
    
    $
    50,792,314Cash held in escrow 22(a)
    
    
    
    
    
    
    (2,803,549
    )Capitalized incorporation costs 22(f)
    
    
    
    
    
    
    (66,339
    )Investments held for trading 22(g)
    
    
    
    
    
    
    (1,147,500
    )Fair value adjustment on restricted
securities 22(g)
    
    
    472,115
    
    
    
    Total assets based on U.S. GAAP
    
    $
    36,954,159
    
    
    $
    46,774,926
  2008
    
    
    2007Shareholders equity based on Canadian GAAP
    
    $
    32,159,321
    
    
    $
    45,157,001Cash held in escrow 22(a)
    
    
    
    
    
    
    (2,803,549
    )Capitalized incorporation costs 22(f)
    
    
    
    
    
    
    (66,339
    )Gains on privately-held securities 22(g)
    
    
    
    
    
    
    (1,147,500
    )Fair value adjustment on restricted
securities 22(g)
    
    
    472,115
    
    
    
    Shareholders equity based on U.S. GAAP
    
    $
    32,631,436
    
    
    $
    41,139,613
 27




---



##### 



2008
    
    
    2007
    
    
    2006Net (loss) earnings for the year in
accordance with U.S. GAAP
    
    $
    (5,668,642
    )
    
    $
    1,776,747
    
    
    $
    (563,814
    )Unrealized gain (loss) on available
for sale securities arising during
the year
    
    
    
    
    
    
    
    
    
    
    242,378Less: reclassification adjustment
for gains realized in net income
    
    
    
    
    
    
    (242,378
    )
    
    
    5,859Change in cumulative translation
adjustment account
    
    
    76,519
    
    
    
    (25,514
    )
    
    
    2,101,995$
    (5,592,123
    )
    
    $
    1,508,855
    
    
    $
    1,786,418
 B. Liquidity and Capital Resources
      28




---



##### 



CRITICAL ACCOUNTING POLICIES AND ESTIMATES
    Goodwill
    Income Taxes
  29




---



##### 



Revenue Recognition  Branding segment
  (i)
    
    deferred revenue representing fees billed and collected in advance of such fees being
earned;(ii)
    
    unbilled accounts receivable representing fees earned but not yet billed as well as
well as reimbursable pass-through costs; and(iii)
    
    work in process represents costs incurred on projects for which revenue has not yet
been recognized for accounting purposes.
    Revenue Recognition  Merchant banking segment
  Financial Instruments
  30




---



##### 



31




---



##### 



Discontinued operations
  Recently Adopted Accounting Policies
     10. IMPACT OF RECENTLY ISSUED ACCOUNTING STANDARDS
 Goodwill and Intangible Assets
  32




---



##### 



International Financial Reporting Standards (IFRS)
  Fair Value Measurements (SFAS 157)
  Fair Value Option for Financial Assets and Financial Liabilities (SFAS 159)
  FIN 141(R), Business Combinations and FAS 160, Noncontrolling Interests in Consolidated Financial
Statements
  33




---



##### 



FAS 161, Disclosures about Derivative Instruments and Hedging Activities.
  FORWARD LOOKING STATEMENTS
  C. Research and Development, Patents and Licenses, etc.
  D. Trend Information
  E. Off-Balance Sheet Arrangements
  34




---



##### 



F. Commitments and Contractual Commitments
  Total
    
    
    Due in year 1
    
    
    Due in year 2
    
    
    Due in year 3Operating leases
    
    $
    1,088,837
    
    
    $
    769,670
    
    
    $
    317,647
    
    
    $
    1,520Long term debt
    
    
    69,599
    
    
    
    69,599
    
    
    
    
    
    
    
    Total contractual
cash obligations
    
    $
    1,158,436
    
    
    $
    839,269
    
    
    $
    317,647
    
    
    $
    1,520
 G. Safe Harbor
  Item 6: Directors and Senior Management and Employees
 A. Directors and Senior Management
  NameAge
    
    Positions Held with EnvoyGeoffrey B. Genovese
    
    President, Chairman and Chief54
    
    Executive Officer and DirectorJ. Joseph Leeder
    
    Executive Vice President Mergers54
    
    & Acquisitions and Chief Financial OfficerJohn H. Bailey
    
    Executive Vice President,63
    
    Corporate Secretary and DirectorDavid Hull 123
    
    Director52Hugh Aird 123
    
    Director52David Parkes 123
    
    Director52
 
 1
    
    Member of the Audit Committee2
    
    Member of the Compensation Committee3
    
    Member of the Nominating and Corporate Governance Committee 35




---



##### 



Geoffrey B. Genovese :
 J. Joseph Leeder , CA :
 John H. Bailey:
 David Hull :
 Hugh Aird :
 David Parkes :
 36




---



##### 



Business Corporations Act
  B. Compensation
  Annual Compensation
    
    
    Long-Term CompensationAwards
    
    
    PayoutsSecurities
    
    
    RestrictedUnder
    
    
    Shares orName and
    
    
    
    
    
    
    
    
    
    Other
    
    
    Option/SARs
    
    
    Restricted
    
    
    LTIP
    
    
    All OtherPrincipal
    
    Salary
    
    
    
    
    
    
    Annual
    
    
    Granted
    
    
    Share Units
    
    
    Payouts
    
    
    CompensationPosition
    
    ($)
    
    
    Bonus
    
    
    ($)
    
    
    (#)
    
    
    ($)
    
    
    ($)
    
    
    ($)Geoffrey B. Genovese,
    
    $
    550,000
    
    
    
    
    
    
    $
    321,086
    1
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    162,617 2Chairman, President
and Chief Executive
OfficerJ. Joseph Leeder,
    
    $
    400,000
    
    
    
    
    
    
    $
    20,603
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Vice President,
Mergers and
Acquisitions and Chief
Financial OfficerJohn H. Bailey,
    
    $
    300,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Executive Vice
President, and
SecretaryColin Beaton
    
    $
    260,691
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Managing Director,
Watt Retail Design
PracticePatrick Rodmell,
    
    $
    331,923
    
    
    $
    75,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Managing Director,
Watt International Inc.
 
 1
    
    Included in this amount is $300,000 which was paid to a corporation
related to Mr. Genovese as an annual management fee.2
    
    Mr. Genovese received taxable benefits for life insurance premiums paid
by the Corporation and a car allowance. 37




---



##### 



Stock Options Exercised During 2008 Fiscal Year
 Unexercised Options
    
    Value of Unexercised InNumber of
    
    
    
    
    
    at
    
    the Money Options atShares
    
    Aggregate
    
    FY-End Exercisable/
    
    FY-EndAcquired on
    
    Value Realized
    
    Unexercisable
    
    Exercisable/UnexercisableName
    
    Exercise
    
    ($)
    
    (#)
    
    ($)Geoff Genovese
    
    Nil
    
    Nil
    
    80,000/nil
    
    nil/nilJoseph Leeder
    
    Nil
    
    Nil
    
    nil/nil
    
    nil/nilJohn H. Bailey
    
    Nil
    
    Nil
    
    40,000/nil
    
    nil/nilPatrick Rodmell
    
    
    13,333
    
    
    $
    23,466
    
    
    15,000/nil
    
    nil/nilColin Beaton
    
    Nil
    
    Nil
    
    nil/nil
    
    nil/nil
  Employment Contracts and Termination Agreements:
    38




---



##### 



Compensation of Directors:
  39




---



##### 



Directors and Officers Liability Insurance:
  C. Board Practices
 Corporate Governance:
 Disclosure Corporate Governance Practices Corporate Governance Guidelines Audit Committees
   Board of Directors:
  40




---



##### 



Director
    
    Board Meetings Attended 1Hugh Aird
    
    8 of 8John Bailey
    
    8 of 8Geoff Genovese
    
    8 of 8David Hull
    
    8 of 8David Parkes
    
    7 of 8
 
 Note: 1 In addition, Messrs. Aird, Hull and Parkes attended six meetings of the independent
directors, at which Messrs. Genovese and Bailey were not eligible to attend. Messrs. Aird, Hull and
Parkes also attended nine meetings of the audit committee and five meetings of the compensation
committee. 41




---



##### 



Mandate of the Board:
    Board Committees:
  (a) Audit Committee
  (b) Compensation Committee
  42




---



##### 



Nominating and Corporate Governance Committee
  Position Descriptions:
   Orientation and Continuing Education:
  43




---



##### 



Nomination of Directors:
    Other Board Committees:
  44




---



##### 



Assessments:
   Shareholder Communication:
  D. Employees
      45




---



##### 



E. Share Ownership
  Options
     Number of CommonShares Under
    
    ExerciseClass of Optionee
    
    Options Granted
    
    Price
    
    Date of ExpiryGeoffrey Genovese
    
    
    80,000
    
    
    $
    4.00
    
    
    May 24, 2009John H. Bailey
    
    
    40,000
    
    
    $
    4.00
    
    
    May 24, 2009Joseph Leeder
    
    

    nil
    

    
    
    n/a
    
    
    
    

    n/aPatrick Rodmell
    
    
    15,000
    
    
    $
    4.00
    
    
    May 24, 2009Other
    
    
    90,000
    
    
    $
    4.00
    
    
    May 24, 2009Total
    
    
    225,000
 46




---



##### 



Number of Common
    
    Percent ofIdentity of Person
    
    Shares Owned
    
    Outstanding ClassGeoffrey Genovese
    
    
    419,221
    
    
    
    4.9
    %Joseph Leeder
    
    

    nil
    

    
    

    nilColin Beaton
    
    

    nil
    

    
    nilPatrick Rodmell
    
    
    13,333
    
    
    
    0.2
    %John H. Bailey
    
    
    25,000
    
    
    
    0.3
    %Hugh Aird
    
    
    250
    
    
    
    0.0
    %David Hull
    
    
    55,700
    
    
    
    0.7
    %David Parkes
    
    
    10,000
    
    
    
    0.1
    %
 Item 7: Major Shareholders And Related Party Transactions
 A. Major Shareholders
      47




---



##### 



Number ofIdentity of
    
    Common Shares
    
    Percent ofPerson or Group
    
    Beneficially Owned
    
    Outstanding ClassGeoffrey B. Genovese
    
    
    419,221
    
    
    
    4.9
    %
   B. Related Party Transactions
    48




---



##### 



Discontinued Operations.
     49




---



##### 



C. Interests of Experts and Counsel
  Item 8: Financial Information
  Item 9: The Offer and Listing
 A. Price History
    High
    
    LowFiscal 2004
    
    $
    10.75
    
    
    $
    2.45Fiscal 2005
    
    
    4.50
    
    
    
    2.30Fiscal 2006
    
    
    2.70
    
    
    
    1.50Fiscal 2007
    
    
    4.71
    
    
    
    2.35Fiscal 2008
    
    
    3.24
    
    
    
    2.00Quarterly 2008First Quarter
    
    
    3.24
    
    
    
    2.72Second Quarter
    
    
    3.05
    
    
    
    2.00Third Quarter
    
    
    3.14
    
    
    
    2.37Fourth Quarter
    
    
    2.60
    
    
    
    2.00
 50




---



##### 



High
    
    LowQuarterly 2007First Quarter
    
    
    3.10
    
    
    
    2.35Second Quarter
    
    
    4.71
    
    
    
    2.60Third Quarter
    
    
    4.42
    
    
    
    3.05Fourth Quarter
    
    
    3.61
    
    
    
    2.76For the month endingNovember 30, 2008
    
    
    1.89
    
    
    
    1.29October 31, 2008
    
    
    2.15
    
    
    
    1.10September 30, 2008
    
    
    2.36
    
    
    
    2.00August 31, 2008
    
    
    2.52
    
    
    
    2.16July 31, 2008
    
    
    2.60
    
    
    
    2.29June 30, 2008
    
    
    2.97
    
    
    
    2.64
  High
    
    LowFiscal 2004
    
    
    U.S. $8.05
    
    
    
    U.S. $1.85Fiscal 2005
    
    
    3.75
    
    
    
    1.80Fiscal 2006
    
    
    2.36
    
    
    
    1.31Fiscal 2007
    
    
    4.07
    
    
    
    2.13Fiscal 2008
    
    
    3.39
    
    
    
    1.90Quarterly 2008First Quarter
    
    
    3.39
    
    
    
    2.71Second Quarter
    
    
    3.04
    
    
    
    2.23Third Quarter
    
    
    3.22
    
    
    
    2.37Fourth Quarter
    
    
    2.66
    
    
    
    1.90Quarterly 2007First Quarter
    
    
    2.69
    
    
    
    2.13Second Quarter
    
    
    4.04
    
    
    
    2.50Third Quarter
    
    
    4.07
    
    
    
    2.81Fourth Quarter
    
    
    3.45
    
    
    
    2.81
 51




---



##### 



High
    
    LowFor the month endingNovember 30, 2008
    
    
    1.59
    
    
    
    1.08October 31, 2008
    
    
    2.04
    
    
    
    0.82September 30, 2008
    
    
    2.20
    
    
    
    1.90August 31, 2008
    
    
    2.62
    
    
    
    2.11July 31, 2008
    
    
    2.66
    
    
    
    2.22June 30, 2008
    
    
    3.00
    
    
    
    2.58
   B. Plan of Distribution
  C. Markets
  D. Selling Shareholders
  E. Dilution
  F. Expenses of the Issue
  Item 10: Additional Information
 A. Share Capital
  B. Memorandum and Articles of Association
  52




---



##### 



C. Material Contracts
  D. Exchange Controls and Other Limitations Affecting Security Holders
       53




---



##### 



E. Taxation
     54




---



##### 



55




---



##### 



Passive Foreign Investment Company Rules
   56




---



##### 



QEF Election
    57




---



##### 



58




---



##### 



Mark-to-Market Election
   59




---



##### 



U.S. Holders are urged to consult their tax advisors concerning the United States federal income
tax consequences of holding and disposing of stock of a PFIC.
 Ownership and Disposition of Common Shares if Envoy is Not a PFIC
    60




---



##### 



Backup Withholding and Information Reporting
   F. Dividend and Paying Agents
  G. Statement by Experts
  H. Documents on Display
  http://www.sec.gov
 61




---



##### 



I. Subsidiary Information
  Item 11: Quantitative and Qualitative Disclosures about Market Risk
          62




---



##### 



63




---



##### 



Item 12: Description of Securities Other Than Equity Securities
  PART II
 Item 13: Defaults, Dividends Arrearages and Delinquencies
 A.
 B.
 Item 14: Material Modifications to the Rights of Security Holders and Use of Proceeds
 A.
 B.
 C.
 D.
 E.
 Item 15: Controls and Procedures
   64




---



##### 



Item 16A: Audit Committee Financial Expert
  65




---



##### 



Item 16B: Code of Business Conduct
       66




---



##### 



Item 16C: Principal Accountant Fees and Services
 (a)
    
    AUDIT FEESwere $250,000 in 2008 and $250,000 in 2007. These fees include year end audit
work, consents, reviews and assistance with regulatory filings.
 (b)
    
    AUDIT-RELATED FEESwere $15,650 in 2008 and $10,000 in 2007. These fees include assistance
with due diligence and accounting research.
 (c)
    
    TAX FEESwere $42,500 in 2008 and $25,000 in 2007. These fees include tax compliance services
and tax advice.
 (d)
    
    All OTHER FEESwere $nil in 2008, and $nil in 2007.
 (e)
    
    In accordance with the Companys Audit Committee Charter, the Audit Committee ensures the
independent auditor submits a formal written statement delineating all relationships between
the independent auditor and the Company and pre-approves all audit fees and non-audit services
to be provided to the Company or any subsidiary by the independent auditor. All services
provided to the Company after the adoption of the Audit Committee Charter were pre-approved by
the Audit Committee.
 Item 16D: Exemptions from the Listing Standards for Audit Committees
  67




---



##### 



Item 16E: Purchases of Equity Securities by the Issuer and Affiliated Purchasers
  (d) Maximum Number(c) Total Number
    
    (or Approximate(b) Average
    
    of Shares (or Units)
    
    Dollar Value) of Shares(a) Total Number
    
    Price Paid
    
    Purchased as Part
    
    (or Units) that May Yetof Shares (or
    
    per Share
    
    of Publicly Announced
    
    Be Purchased Under thePeriod
    
    Units) Purchased
    
    (or Units)
    
    Plans or Programs
    
    Plans or ProgramsOctober 1, to
October 31, 2007
    
    
    93,740
    
    
    $
    3.08
    
    
    
    93,740
    
    
    
    94,612November 1, to
November 19, 2007
    
    
    94,569
    
    
    $
    3.01
    
    
    
    94,569
    
    
    nilFebruary 7, to
February 29, 2008
    
    
    30,000
    
    
    $
    2.61
    
    
    
    30,000
    
    
    
    873,880March 1, to
March 31, 2008
    
    
    211,755
    
    
    $
    2.63
    
    
    
    211,755
    
    
    
    662,125April 1, to
April 30, 2008
    
    
    353,570
    
    
    $
    2.65
    
    
    
    353,570
    
    
    
    308,555May 1, to
May 31, 2008
    
    
    79,800
    
    
    $
    2.81
    
    
    
    79,800
    
    
    
    228,755June 1, to
June 30, 2008
    
    
    40,400
    
    
    $
    2.85
    
    
    
    40,400
    
    
    
    188,355July 1, to
July 31, 2008
    
    
    43,673
    
    
    $
    2.52
    
    
    
    43,673
    
    
    
    144,682August 1, to
August 31, 2008
    
    
    13,800
    
    
    $
    2.37
    
    
    
    13,800
    
    
    
    130,882September 1, to
September 30, 2008
    
    
    103,623
    
    
    $
    2.21
    
    
    
    103,623
    
    
    
    27,259October 1, to
October 3, 2008
    
    
    27,259
    
    
    $
    2.02
    
    
    
    27,259
    
    
    nilTotal
    
    
    1,092,189
    
    
    
    
    
    
    
    1,092,189
 68




---



##### 



PART III
 Item 17: Financial Statements
 (a)
    
    Envoy Capital Group Inc.(i)
    
    Auditors Report on the financial statements for the year ended
September 30, 2008
    
    F-1Comments by Auditor for U.S. Readers on Canada-U.S. Reporting
DifferencesAuditors Report on the financial statements for the year ended
September 30, 2008 and 2007(ii)
    
    Consolidated Balance Sheets as at September 30, 2008 and 2007
    
    F-2(iii)
    
    Consolidated Statements of Operations for the years ended September
30, 2008, 2007 and 2006
    
    F-3(iv)
    
    Consolidated Statements of (Deficit) Retained Earnings for the years
ended September 30, 2008, 2007 and 2006
    
    F-4(v)
    
    Consolidated Statements of Cash Flows for the years ended September
30, 2008, 2007 and 2006
    
    F-5(vi)
    
    Notes to Consolidated Financial Statements
    
    F-6
 Item 18: Financial Statements
  69




---



##### 



Item 19: Exhibits
 EXHIBIT INDEX
 Exhibit No.
    
    Description1.1*
    
    Articles of Incorporation and By-Law No. 1 (as amended on May 2, 2000) of Envoy
Communications Group Inc.1.2**
    
    Articles of Amendment (as amended on January 9, 2004) and By-Law No. 1 of Envoy
Communications Group Inc.1.3**
    
    Articles of Amendment (as amended on January 21, 2005) and By-Law No. 1 of Envoy
Communications Group Inc.1.4
    
    Articles of Amendment (as amended on March 30, 2007) and By-Law No. 1 of Envoy Capital Group
Inc.8.1
    
    List of Significant Subsidiaries (contained in Item 4.C hereof)11.1***
    
    Code of Business Conduct11.2***
    
    Complaint Procedures for Accounting and Auditing Matters11.3***
    
    Board Mandate12.1
    
    Certification of CEO Pursuant to Section 302 of the Sarbanes-Oxley Act of 200212.2
    
    Certification of CFO Pursuant to Section 302 of the Sarbanes-Oxley Act of 200213.1
    
    Certifications of CEO and CFO Pursuant to Section 906 of the Sarbanes-Oxley Act of 200215.1***
    
    Audit Committee Charter15.2***
    
    Compensation Committee Charter15.3***
    
    Nominating and Corporate Governance Committee Charter17
    
    Financial Statements
 
 *
    
    Incorporated by reference to the Companys Annual Report on Form 20-F, filed on May 15, 2000
(Commission File No. 000-30082)**
    
    Incorporated by reference to the Companys Annual Report on Form 20-F, filed on December 29,
2006 (Commission File No. 000-30082).***
    
    Incorporated by reference to the Companys Annual Report on Form 20-F, filed on December 29,
2005 (Commission File No. 000-30082). 70




---



##### 



SIGNATURES
  ENVOY CAPITAL GROUP INC.Date: December 22, 2008
    /s/ GEOFFREY B. GENOVESEName:
    Geoffrey B. GenoveseTitle:
    Chairman, President and
Chief Executive Officer 71