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CryptoLogic Inc.   RENEWAL ANNUAL INFORMATION FORM   For the year ended December 31, 2003   Dated May 6, 2004




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TABLE OF CONTENTS ITEM 1: INTRODUCTION
    
    
    1ITEM 2: CORPORATE STRUCTURE
    
    
    1Name and Incorporation
    
    
    1Intercorporate Relationships
    
    
    2ITEM 3: GENERAL DEVELOPMENT OF THE BUSINESS
    
    
    2Three-Year History
    
    
    3ITEM 4: NARRATIVE DESCRIPTION OF THE BUSINESS
    
    
    4General Description
    
    
    4Business and Marketing Strategies
    
    
    5Competition
    
    
    7New Products and Services
    
    
    7Intellectual Property
    
    
    7Seasonality
    
    
    8Employees
    
    
    8Risk Factors
    
    
    8Dividend
    
    
    13ITEM 5: SELECTED CONSOLIDATED FINANCIAL INFORMATION
    
    
    14Annual Financial Information
    
    
    14Quarterly Financial Information
    
    
    15Reporting Currency
    
    
    15ITEM 6: MANAGEMENTS DISCUSSION AND ANALYSIS
    
    
    16ITEM 7: MARKET FOR SECURITIES
    
    
    16ITEM 8: DIRECTORS AND OFFICERS
    
    
    16ITEM 9: ADDITIONAL INFORMATION
    
    
    19




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Item 1: INTRODUCTION All dollar amounts in this Annual Information Form are in United States
dollars, except where indicated otherwise. Effective January 1, 1998, the
Companys reporting is in United States dollars. Certain general information contained in this Annual Information Form
concerning the industry in which the Company operates has been obtained from
publicly available information from third party sources. The Company has not
verified the accuracy or completeness of any information contained in such
publicly available information. In addition, the Company has not determined if
there has been any omission by any such third party to disclose any facts,
information or events which may have occurred prior to or subsequent to the
date as of which any such information contained in such publicly available
information has been furnished or which may affect the significance or accuracy
of any information contained in any such information and summarized herein. Certain statements contained in this Annual Information Form constitute
forward-looking statements. When used in this document, the words may,
would, could, will, intend, plan, anticipate, believe,
estimate, expect and similar expressions, as they relate to the Company or
our management, are intended to identify forward-looking statements. Such
statements reflect the Companys current views with respect to future events
and are subject to certain risks, uncertainties and assumptions. Many factors
could cause the Companys actual results, performance or achievements that may
be expressed or implied by such forward-looking statements to vary from those
described herein. Should one or more of these risks or uncertainties
materialize, or should assumptions underlying forward-looking statements prove
incorrect, actual results may vary materially from those described herein as
intended, planned, anticipated, believed, estimated or expected. The Company
does not intend, and does not assume any obligation, to update these
forward-looking statements. Item 2: CORPORATE STRUCTURE Name and Incorporation CryptoLogic Inc. (CryptoLogic or the Company) was formed by articles of
amalgamation (the Amalgamation) under the Business Corporations Act(Ontario)
effective March 7, 1996 pursuant to an amalgamation agreement dated January 19,
1996 between Inter.tain.net Inc., a private corporation, and Biroco Kirkland
Mines Limited. Immediately prior to the Amalgamation, Biroco Kirkland Mines
Limited did not carry on active operations. The Companys registered office is located at 220 Bay Street, 7th Floor,
Toronto, Ontario, Canada, M5J 2W4. The Companys head office is located at 1867
Yonge Street, 7th Floor, Toronto, Ontario, Canada, M4S 1Y5. On June 28, 1996, the Company changed its name from Inter.tain.net Inc. to
its current name, CryptoLogic Inc.




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2

Intercorporate Relationships The organizational structure of the Company and our operating subsidiaries
(collectively, the Subsidiaries) as of December 31, 2003 is set forth below.
For the remainder of this document, the consolidated operations of the Company
and our Subsidiaries will be referred to collectively as we, our, the
Company or CryptoLogic, unless otherwise specifically noted. (ORGANISATION CHART) Note: In all cases in the above chart, the parent company owns directly or
indirectly, all of the issued and outstanding shares of the applicable
subsidiary.
 Item 3: GENERAL DEVELOPMENT OF THE BUSINESS CryptoLogic is a leading software and services provider to the worldwide
Internet gaming market. Our online gaming software and related proprietary
e-commerce technology and support services enable secure, high-speed financial
transactions over the Internet, and our leadership in regulatory compliance
makes us one of very few companies with gaming software that is certified to
strict standards similar to land-based gaming. As at December 31, 2003,
through our wholly-owned subsidiary, WagerLogic Limited (WagerLogic), we
license and support our Internet-based gaming software package to 11 licensees
located around the world including a number of brand name and land-based gaming
organizations in the United Kingdom, who hold Internet gaming licenses issued
by governments where the licensees online gaming operations are domiciled. Since inception in 1996, our software solutions have processed over $18 billion
in secure online wagers for more than 1.7 million players in 240 countries
worldwide.




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3

Three-Year History The global online gaming industry has grown from $3.0 billion in 2001 to $5.7
billion in revenues in 2003, and is forecast to rise to $7.5 billion in 2004.
We are mindful that while online gaming continues to grow rapidly, we continue
to operate in a challenging business environment faced with regulatory
uncertainty including US efforts aimed at banning online gaming, restrictions
by some US credit card processors, and heightened competition, which has
created margin pressures. Given the absence of legislative clarity in the US, international markets 
Europe and particularly the United Kingdom  have become a core focus for
CryptoLogic over the past three years. Our international strategy focuses on
investing in and capitalizing on our relationships with leading, international
brand name licensees in foreign markets that are embracing Internet gaming and
represent attractive growth potential. As the industry becomes increasingly competitive and sophisticated, we
emphasize product diversification to leverage our core competency in online
casino gaming to expand into large, emerging game segments such as poker and
bingo that will drive incremental revenue. CryptoLogic has long advocated a regulatory approach to foster a transparent,
credible and growing online gaming industry. We have sought and achieved
certification of our software in strictly regulated jurisdictions. It is
through this process that we maintain our reputation as the pioneer in online
gaming and a trusted provider for licensees and their customers. The introduction of new gaming products, heightened competition, restrictions
on US credit card facilities, the prospect of legislature prohibitions on
online gaming in the US, and the increasing sophistication of online customers,
has required CryptoLogic to deliver expanded and enhanced products to our
customer base in order to remain an industry leader. In order to accomplish
this, considerable time and financial resources have been invested in our
product development over the past three years. The following summarizes key milestones the Company has achieved over the past
three years that have been important to maintaining our stature as the leading
public software company in the online gaming industry:  1.
    
    International growth  CryptoLogic has achieved increasing
geographic diversification as reflected in licensees international
revenue growing to over 55% in 2003, up from approximately 40% in 2002
and approximately 30% in 2001. We work with some of the best
international names in online and land-based gaming including William
Hill, Littlewoods Gaming, InterCasino, The Ritz Club London Online,
ukbetting and Betfair. We have developed a strong presence in the UK,
where regulation of online gaming is expected to be legislated in the
next 24 months. During 2003, WagerLogic also rationalized and reduced
the number of licensees from 21 to 11 by our choice, in order to focus
on quality versus quantity of licensees that yield the greatest return
on effort.  2.
    
    Market-oriented solutions  Although CryptoLogic pioneered the
Internet gaming software industry, there has been increasing
competition over the past three years. In order to remain an industry
leader, we have invested significantly in research and development and
service enhancements. In the last few years, we have released new
poker and bingo products, and continued to expand and enhance our core
casino software. These product releases have included new choices of
popular slot and casino table games such as a potential million-dollar
progressive slot, an integrated bingo/slot offering, a non-downloadable
Java version of our casino product, and new currencies and new
languages to appeal to broader gaming audiences worldwide and to enable
our licensees to expand into new revenue and high-margin game segments.
We also continued to expand our payment solution including new
e-check/debit methods (Neteller, FirePay, TeleBuy, 900Pay, Citidel).




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4

3.
    
    Regulatory leadership  We are one of the few online gaming
providers in the world to have our software certified in highly
regulated jurisdictions comparable to land-based casino standards.
This was achieved in Alderney and the Isle of Man. In order to achieve
government approval in these jurisdictions, we were subject to
extensive probity to ensure the integrity of our Company and key
personnel, and our software was reviewed and certified by
government-accredited independent testing organizations that audited
our software to ensure fair and responsible gaming. In September 2003,
CryptoLogic also listed and commenced trading on the Main Market of the
London Stock Exchange to support our commitment to the highest level of
transparency and compliance. Trends In order to remain competitive, CryptoLogic has had to devote increasing
financial and human resources to meet the technological and regulatory
challenges associated with remaining an industry leader. We anticipate that as
product diversification and sophistication increases, our need to hire greater
numbers of software and marketing specialists will increase, which will
contribute to higher operating costs. Should prohibitions on online gaming legislation be introduced in the United
States, industry participants in this market may increasingly focus their
business on our primary market in the UK, which could place further competitive
pressures on our business. Given the trend to regulate online gaming in Europe, the costs associated with
carrying on business may increase as regulatory initiatives may require greater
resources to meet changing compliance standards. While we presently meet the
highest standards for compliance and certification in Alderney and the Isle of
Man, changes in regulatory requirements, including regulatory fees and
taxation, could impact on the costs of doing business. Not all changes in the industry are foreseeable, but the growth of the industry
and anticipated legislation will likely accelerate the need to offer
comprehensive player solutions at an increasing rate. Item 4: NARRATIVE DESCRIPTION OF THE BUSINESS General Description CryptoLogic is the largest public online gaming software company and a leader
in the global Internet gaming industry. We trade on the Toronto Stock Exchange
(symbol: CRY), Nasdaq National Market (symbol: CRYP) and the London Stock
Exchanges Main Market (symbol: CRP). Our software group is located in Canada,
which provides software development, upgrades and technical support for
WagerLogic Limited (WagerLogic), a wholly-owned subsidiary of CryptoLogic.
WagerLogic provides licensing, marketing, e-cash management and customer
support services for our Internet gaming software to third-party gaming
operators around the world and is located in Cyprus and the United Kingdom. As at December 31, 2003, we had 11 licensees located around the world including
a number of brand name and land-based gaming organizations in the United
Kingdom, who hold Internet gaming licenses issued by governments where the
licensees online gaming operations are domiciled, principally in the
Netherlands Antilles and Alderney, in the British Isles.




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5

Substantially all of our revenue is of a recurring nature in that WagerLogics
licensees pay an ongoing fee for the licensing and support of our software,
calculated as a percentage of each licensees level of activity. Additional
revenues are derived from the provision of software customization, e-cash
processing and advertising services. Historically, we experience seasonality
with slower sales in the third quarter, as the use of the Internet is not as
strong in the summer months when players tend to spend less time indoors and at
their computers. Typically, our first and fourth quarters (during the winter
and fall seasons) are our strongest revenue periods. WagerLogics Internet gaming software and related proprietary e-commerce
technology and services enable secure, reliable, efficient, and rapid financial
transactions over the Internet. Our gaming solution comprises a total suite of
more than 80 Internet-based slot and table casino games, multi-player bingo and
player-to-player poker games in multiple languages (English, Spanish, Japanese,
Chinese, French, German, Italian) and multiple currencies (US dollars, British
pound sterling and Euros) with an integrated e-cash management system and 24/7
customer support. Our Internet game software package is available in both
play-for-fun and play-for-cash mode. Our Internet-based software and proprietary electronic commerce software
products are used by licensees to create virtual casinos, bingo halls or poker
rooms. The downloadable software package transfers the front end information
(i.e., playing cards, roulette wheel, dice numbers) between users and remote
servers. The software package utilizes each users computer to generate the
graphics of the virtual casino, bingo hall or poker room, while the licensees
gaming servers perform the dealer function, generating the random numbers of
playing cards, roulette numbers and dice numbers, as applicable. Our most
popular casino games are also available on both the Java and Flash platforms,
which provide an entertaining gaming experience without the wait of a large
download. Among other things, our software contains proprietary encryption features,
which allow secure transmission of data, and permits our licensees to offer
multi-player games, a panoramic virtual casino floor populated by real players,
progressive jackpots, Internet browsing features and inter-player chatting. As part of our commitment to safe and responsible gaming, our gaming solution
provides personal options and security features including deposit and bet
limits, temporary and permanent account locks, personal identification
verification, and online tracking of a players gaming activity and e-cash
transactions in real-time. Our gaming solution is complemented by an integrated e-cash management system.
We provide Internet-based electronic commerce support and technology to our
licensee customers and maintain, through subsidiaries, electronic commerce
accounts for both merchants of our electronic commerce software and their
end-users. At present, we report and remit to our licensees the net
transaction revenues less licensing and support fees payable to the Company (as
outlined in the applicable licensing agreement). As the online gaming industry
matures, our licensees may utilize their own e-cash systems to enable an
integrated account of all their online offerings, which would have our
licensees remit payment to us. Utilizing our electronic commerce software, users can purchase electronic cash
through a wide range of payment options  by credit card, debit card,
electronic wallet, electronic check, transfer from their bank account, wire
transfer, or personal check, or have the balance in their account returned
through their credit card account, by check or their electronic wallet. Users
of our electronic commerce software products are charged nominal fees for using
this service. We also provide 24/7 customer support in the languages and currencies supported
by our software for enhanced convenience to our licensees global player base,
which is available to help players with technical questions or assistance with
the gaming software and e-cash accounts. It is our objective to continue to introduce innovative software products that
appeal to broad segments of gaming audiences worldwide. Business and Marketing Strategies We intend to capitalize on the vast growth potential of the global online
gaming industry  one of the fastest growing markets on the Internet. The
global online gaming market is forecast to grow to $7.5 billion in revenue in
2004, up from $5.7 billion in 2003, according to River City Group, a
consultancy group that provides independent research on
the interactive gaming industry. Yet this forecast will constitute just over
3% of the estimated global land-based gaming revenue, suggesting vast market
potential. We are mindful that while online gaming continues to grow rapidly,
regulatory uncertainty remains and heightened competition is creating margin
pressures. This is why we are and will continue to invest in our business to
support our strategy.




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6

We remain focused on product diversification in order to leverage our core
competency in online casino gaming to expand into large, emerging lucrative
game segments such as poker and bingo that will drive incremental revenue.
The online poker market, in particular, is exhibiting dramatic growth, and
offers excellent prospects for WagerLogic. Online poker has grown almost
ten-fold in the past year with a current estimated annual run rate in revenue
of over $900 million, up from $100 million in 2002 according to PokerPulse, an
independent research group, which tracks the online poker industry. Given the absence of legislative clarity in the US, near-term opportunities for
online gaming continue to be largely outside North America. Our international
strategy will continue to focus on investing in and capitalizing on our
relationships with leading, international brand name licensees in foreign
markets that are embracing Internet gaming and representing attractive growth
potential. CryptoLogics management has outlined a focused strategy of global market and
product expansion to advance our long term growth. As a result, we are growing
revenues, building long term customer relationships with some of the most
trusted gaming companies in the world, and producing cash earnings in light of
a developing and challenging business environment. Our strategy is based on three core imperatives:  1.
    
    International Diversification  by sustaining key sources of revenue and
maximizing profitability through international growth with existing and
new customers;2.
    
    Market-Oriented Solutions  by enhancing our product offering to create
value for customers and drive incremental revenue; and3.
    
    Regulatory Leadership  through our commitment to the highest standards
of transparency and regulatory compliance. As well, we evaluate from time to time strategic alliances and acquisitions
that would accelerate our development and entry into new games, channels and
markets that will strongly position us for future growth. We currently market our technology and services through a select marketing
strategy whereby a senior sales team based in London, England, identifies key
potential customers that meet our licensee profile, and then contacts such
prospects directly. We also participate in industry trade shows around the
world to generate new sales prospects, and respond to referrals from existing
customers and other industry participants. We do not limit our marketing and advertising efforts to particular
jurisdictions. However, the US market continues to face challenges, given
legislative uncertainty arising from prohibition initiatives. Therefore, we
are leveraging our strong international presence in the UK to expand our sales
and marketing efforts into high-potential markets, particularly Europe and Asia
 regions that are experiencing a growing Internet population and more
favourable attitudes towards gaming as well as pursuing opportunities in large,
emerging game segments such as poker and bingo. Our plans in Europe and Asia include multi-language and multi-currency versions
 both actively marketing current languages and currencies and introducing new
ones with existing and new customers, as well as exploring foreign payment
options that increase the ability of our customers to attract a broader,
international player base. While Asia offers large market potential, fragmented legislation and no single
popular payment form mean higher barriers to entry. We are attending
Asian-Pacific trade shows and identifying local partners that can help us
establish meaningful contacts with governments and major, brand name gaming
organizations. We will continue to pursue opportunities in this market that
will generate an appropriate return.




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7

Competition Although online gaming is a fast-growing industry, it is becoming increasingly
competitive and sophisticated. River City Group, a consulting firm focused on
the online interactive gaming industry, suggests that the global market for
online gaming, which comprises casino games, sports betting, bingo, poker and
lotteries, will rise to $7.5 billion in annual gaming revenue in 2004, up from
$5.7 billion in 2003. Equally dramatic is the number of Internet gaming sites,
now up to more than 1,800 according to Bear Stearns. Licensees of our software compete with existing and more established
recreational services and products, in addition to other forms of
entertainment. Our success will depend, in part, upon our ability to enhance
our products and services to keep pace with technological developments, respond
to evolving customer requirements and achieve continued market acceptance. We compete with a number of public and private companies, which provide
electronic commerce and/or Internet gaming software. Given the emerging
development of the industry and the multitude of private organizations
operating in the industry, information about the nature of our competitors,
their operations and their resources is difficult to compile. In addition to
current known competitors, traditional land-based gaming operators and other
entities, many of which have significant financial resources and name brand
recognition, may provide Internet gaming services in the future, and thus
become competitors of CryptoLogic. Increased competition from current and
future competitors and increased expenditures has and will result in the
reduction of margins, or could result in the loss of market share. The global nature of Internet makes most Internet markets, including the online
gaming industry, relatively accessible to a wide number of entities and
individuals. We believe the principal competitive factors in our industry that
create certain barriers to entry include reputation, technology, financial
stability and resources, proven track record, regulatory compliance,
independent oversight and transparency of business practices. New Products and Services In 2003, we capitalized further on our most recent poker and bingo products,
with both existing and new licensees adding these new product offerings, which
enable them to participate in these emerging and high-growth game areas.
Bingos social and entertaining experience appeals to the casual player and
potentially to a larger mainstream audience than traditional casino products.
Poker is the worlds most popular card game and a large high-growth market for
the Internet. We have seen growth in both our bingo and poker, but more
particularly in poker. In just over one year, fees from these two products
together rose to over 10% of 2003 revenue. This compares with under 1% in
2002. Today, seven major licensees use our solution and are benefiting from
increased player traffic and revenue growth. We continue to expand our game suite and introduce new casino product themes
and variations. New games help re-energize players and drive increased revenue
for our licensees. During 2003, we released more than 10 new choices of the
popular casino games including Single Deck and Multi-Split Blackjack, an
enhanced European Roulette, a new series of 9-Line slots, a multi-currency
Blackjack jackpot game, a new potential million-dollar progressive slot and an
integrated bingo/slot offering. We continue to enhance our payment solution toward our goal of offering our
customers players the broadest range of payment options for increased choice
and convenience and to help our licensees grow profitable Internet businesses.
In 2003, we launched new e-check and debit methods (Neteller InstaCash,
Citadel), easier integration with our Web Ecash, expanded fraud controls
including third-party address and credit card verifications and negative
databases as well as enhanced player usability. Intellectual Property As a leading software developer in the Internet gaming industry, our business
is based on licensing our gaming software and related proprietary e-commerce
technology and support services through WagerLogic. Licensing contracts
generally extend from 3 to 5 years and have renewal provisions, which provides
us with a long term recurring revenue stream. We rely on a combination of laws
and contractual provisions to establish and protect our
rights in our software and proprietary technology. We believe that much of our
competitive position is dependent upon our ability to protect our proprietary
information. We generally enter into non-disclosure and invention agreements
with employees, licensees, consultants and customers, and historically have
restricted access to our software products source codes. Our source codes are
proprietary to us and we protect the source code versions of our products as
trade secrets and unpublished copyrighted works. Our source code is deposited
with a third party escrow agent in the UK. Despite our precautions and
measures implemented to protect against such attempts, unauthorized parties may
have copied or otherwise obtained and used information that we regard as
proprietary or could also in the future.




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8

At the present time, we do not possess any patent or copyright registrations in
Canada, the United States or any other jurisdiction. However, our Company and
subsidiaries have trademarks in certain jurisdictions and are in the process of
applying for further trademark registrations, which would provide such
protection in relevant jurisdictions. Certain provisions of our license
agreements, including provisions protecting against unauthorized use, transfer
and disclosure, may be unenforceable under the laws of certain jurisdictions. We believe that patent, trademark, copyright and other legal protections are
less significant to our success than other factors such as the knowledge,
ability and experience of our personnel, new product and service developments,
frequent product enhancements, customer service and ongoing product support. We also have a proprietary interest in our name. The names CryptoLogic and
WagerLogic have become well known in the Internet gaming industry.
Accordingly, our competitive position could be affected if our name was
misappropriated and our reputation in any way compromised. There can be no assurance that the steps we have taken to protect our
proprietary rights will be adequate to deter misappropriation of our technology
or independent development by others of technologies that are substantially
equivalent or superior to our technology. Any misappropriation of our name,
technology or development of competitive technologies could have a material
adverse effect on our business, revenues, operating results and financial
condition. Seasonality Historically, we have experienced slower sales in the third quarter, as the use
of the Internet is not as strong in the summer months, when players tend to
spend less time indoors and at their computers. Typically, our first and
fourth quarters (during the winter and fall seasons) are our strongest revenue
periods. Employees As at December 31, 2003, our Company, including our subsidiaries, employed 175
people, with 135 employees located in Canada and 40 located internationally.
More than 80% of our staff is dedicated to development, compliance, sales,
marketing and customer support. Our ability to attract and retain highly skilled technical, sales and marketing
and management personnel and a multi-lingual customer support staff is one of
the key factors in our success. We anticipate that as the demand for gaming options and the quality of products
increases, additional staffing requirements will need to be met to remain
competitive. Risk Factors CryptoLogic operates in a rapidly changing environment that involves numerous
risks and uncertainties, many of which are beyond our control and which could
have a material adverse effect on our business, revenues, operating results and
financial condition. The following discussion highlights some of these risks
and uncertainties. In addition, readers should carefully review the risk
factors described in the Annual Report the Company files with various
Securities Commissions.




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9

Industry Risks Government Regulation The Company and our licensees are subject to applicable laws in the
jurisdictions in which they operate. At the present time, our licensees operate
under online gaming licenses issued by governments in two jurisdictions,
Alderney and Netherlands Antilles. Some jurisdictions have introduced
regulations attempting to restrict or prohibit Internet gaming, while other
jurisdictions have taken the position that Internet gaming is legal and/or have
adopted or are in the process of considering legislation to regulate Internet
gaming. Currently, the UK is establishing a regulated market for online gaming. The
Isle of Man and Alderney  both in the British Isles  are already fully
regulated environments for Internet gaming, based on high standards consistent
with land-based gaming. The British government is currently drafting
legislation to create a regulated and licensed jurisdiction for Internet
gaming. Opposing views are developing in Europe. Some European countries, including
Italy, Germany and Holland where there are state-owned monopolies, are taking
action aimed at banning foreign online gaming operators. Such actions by
these member states are in contrast with a recent favourably-viewed ruling from
the European Court of Justice that challenged member state monopolies and have
prompted the European Commission to look at creating new legislation that could
harmonize online gaming within the EU, in line with the ECs goal to encourage
a free and open cross-border market. As companies and consumers involved in Internet gaming, including our licensees
and their players, are located around the globe, there is uncertainty regarding
which government has authority to regulate or legislate the industry. However,
legislation and legal action designed to restrict or prohibit Internet gaming
may be adopted in the future in the United States or other jurisdictions. Future decisions may have a material impact on our operations and financial
results. Existing legislation, including US federal and state statutes, have
been and could continue to be construed to prohibit or restrict gaming through
the use of the Internet, and there is a risk governmental authorities may view
us or our licensees as having violated such statutes. Therefore, there is a
risk that legal proceedings could be initiated against us, our licensees,
Internet service providers, credit card processors and others involved in the
Internet gaming industry. This could involve substantial litigation expense,
penalties, fines, injunctions or other remedies or restrictions being imposed
upon us or our licensees or others while diverting the attention of key
executives. Such proceedings could have a material adverse effect on our
business, revenues, operating results and financial condition. Given the legislative uncertainty particularly in the US, we are focused on
increasing our international diversification in global markets that embrace
online gaming. Nevertheless, there can be no assurances that additional
legislation or the burdens associated with complying with them will not be
proposed and passed in the United States or in other potentially relevant
jurisdictions to legislate or regulate various aspects of the Internet or the
Internet gaming industry. Credit Card Processing Since December 2001, certain financial institutions in the US ceased to accept
online gaming transactions through their credit cards due to the uncertainty
regarding the legislation of Internet gaming in that country. This event has
had a negative impact on the Internet gaming industry as a whole, on our
licensees, and on the Company, as evidenced in lower revenues in 2002. There
can be no assurance that other financial institutions or credit card issuers in
the US and/or other countries will not enact additional restrictions. Such
developments would have a material adverse effect on our business, revenues,
operating results and financial condition. However, this risk may be mitigated
with ongoing expansion of our alternate payment solutions and our strategy to
expand in Europe. E-commerce Law In addition to regulations pertaining specifically to online gaming, we may
become subject to any number of laws and regulations that may be adopted with
respect to the Internet and electronic commerce. As well, current laws,
which predate or are incompatible with Internet commerce, may be enforced in a
manner that restricts the electronic commerce market. However, the
application of such pre-existing Canadian, US and international laws regulating
communications or commerce in the context of the Internet and electronic
commerce is uncertain.




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10

Moreover, it may take years to determine the extent to which existing laws
relating to issues such as intellectual property ownership and infringement,
libel and personal privacy are applicable to the Internet. New laws and regulations that address issues such as user privacy, pricing,
online content regulation, taxation, advertising, intellectual property,
information security, and the characteristics and quality of online products
and services may be enacted. The adoption of new laws or regulations relating to the Internet, or particular
applications or interpretations of existing laws, could decrease the growth in
the use of the Internet, decrease the demand for our products and services,
increase our cost of doing business or could otherwise have a material adverse
affect on our business, revenues, operating results and financial condition. Business Risks E-commerce Adoption The success of our electronic commerce services will depend in large part on
the widespread adoption of the Internet for commercial transactions. The
marketplace for electronic commerce is in the development stage, and is subject
to frequent and rapid technological changes. It is not possible to fully
predict any trend and therefore any eventual impact on our operations and
financial results. Internet Viability and Infrastructure The growth of Internet usage has caused frequent interruptions and delays in
processing and transmitting data over the Internet. There can be no assurance
that the Internet infrastructure or the Companys own network systems will
continue to be able to support the demands placed on us by the continued growth
of the Internet, the overall online gaming industry or that of our customers. The Internet could lose its viability due to delays in the development or
adoption of new standards and protocols to handle increased levels of Internet
activity or due to increased government regulation. If critical issues
concerning the commercial use of the Internet are not favorably resolved
(including security, reliability, cost, ease of use, accessibility and quality
of service), if the necessary infrastructure is not developed, if the Internet
is no longer a viable commercial marketplace, or if other technologies and
technological devices eclipse the Internet as a viable channel, this may
negatively affect the growth of Internet usage, and our business, revenues,
financial condition and operating results will be materially adversely
affected, and we may be forced to cease operations. End-users of our software depend on Internet service providers, online service
providers and gaming site operators for access to the Internet gaming sites
operated by our licensees and their competitors. Many of these services have
experienced service outages in the past and could experience service outages,
delays and other difficulties due to system failures unrelated to our systems
or our licensees. Our licensees may lose customers as a result of delays or
interruption in service, including delays or interruptions relating to high
volumes of traffic or technological problems, which could materially adversely
affect our business, revenues, operating results and financial condition. Also, the increasing presence of viruses and cyber attacks may affect the
viability and infrastructure of the Internet. Market Demand Both the Internet and Internet gaming industries are relatively new industries
that continue to rapidly evolve and are characterized by an increasing number
of market entrants. The demand and acceptance for new products and services
are subject to a high level of uncertainty. There can be no assurance that
gaming on the Internet will become widespread.




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##### 



11

Substantially all of our revenues to date have been derived from the licensing
of our Internet gaming software and the support of our associated services
through our licensing subsidiary. If the market fails to develop, develops
more slowly than expected, or becomes saturated with competitors or competitive
products or if our services do not achieve market acceptance, our business,
revenues, operating results and financial condition could be materially
adversely affected. Security Our Internet gaming software and electronic commerce services are reliant on
technologies and network systems to securely handle transactions and user
information over the Internet, which may be vulnerable to system intrusions,
unauthorized access or manipulation. As users become increasingly sophisticated
and devise new ways to commit fraud, our security and network systems may be
tested and subject to attack. We have experienced such system attacks in the
past and implemented measures to protect against these intrusions. However,
there is no assurance that all such intrusions/attacks will or can be prevented
in the future, and any system intrusion/attack may cause a delay, interruption
or financial loss, which could have a material effect on our business, revenue,
operating results and financial condition. Reliance on Other Parties Our electronic commerce product relies on Internet Service Providers (ISPs) to
allow our licensees customers and servers to communicate with each other. If
all of the ISPs experienced service interruptions, it would prevent
communication over the Internet and would impair our ability to carry on
business. Our ability to process e-commerce transactions depends on bank processing and
credit card systems. In order to prepare for system problems, we have developed
and tested a formal disaster recovery plan. Nevertheless, any system failure,
including network, software or hardware failure, which causes a delay or
interruption in our e-commerce services could have a material adverse effect on
our business, revenues, operating results and financial condition. Dependence on Licensees In fiscal 2003, our top 5 licensees accounted for approximately 93% of our
total revenue, a similar concentration to 2002, although representing a
different mix of licensees. In addition, a large majority of key licensees
operate from one licensing jurisdiction. The loss of one or more of these key
licensees or their license in their respective jurisdiction or a material
change in the terms of their license agreements could have a material adverse
effect on our business, revenues, operating results and financial condition. Chargebacks As a result of increasing player deposit levels, we are subject to higher
exposure to chargebacks. Chargebacks are any deposit transaction credited to a
users account that is later reversed or repudiated by that end user. While
the Company has a provision for chargebacks, this factor could have a material
adverse effect on our business, revenues, operating results and financial
conditions and our relationship with credit card providers. Foreign Operations A significant portion of our revenues is derived from licensing and support
fees in foreign countries. The Company and our licensees are subject to local
laws and regulations in those jurisdictions in which they operate. While some
jurisdictions have introduced regulations designed to restrict Internet gaming,
others have demonstrated acceptance of such activities. Currently, more than
70 jurisdictions worldwide regulate or are in the process of legalizing some
form of Internet gaming according to the River City Group.




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##### 



12

As companies and consumers involved in Internet gaming, including the players
of our licensees, are located around the globe, there is uncertainty regarding
exactly which government has jurisdiction or authority to regulate or legislate
with respect to various aspects of the industry. The uncertainty surrounding
the regulation of Internet gaming in the various jurisdictions in which we
operate could have a material adverse effect on our business, revenues,
operating results and financial condition. In addition, there are certain difficulties and risks inherent in doing
business internationally, including the burden of complying with multiple and
conflicting regulatory requirements, foreign exchange controls, potential
restrictions or tariffs on gaming activities that may be imposed, potentially
adverse tax consequences and tax risks. Changes in the political and economic
stability, regulatory and taxation structures, and the interpretation thereof,
of jurisdictions in which we or our subsidiaries operate, and in which our
licensees customers are located could have a material adverse effect on our
business, revenues, operating results and financial condition. Our ability to expand our business in certain countries will require
modification of our products, particularly domestic language and currency
support. Once a licensee has posted its gaming site on the Internet, the site
is available to users around the world. However, there can be no assurance that we will be able to sustain or increase
revenue derived from international operations or that we will be able to
penetrate linguistic, cultural or other barriers to new foreign markets. Foreign Exchange Our financial results are reported in US currency, which is subject to
fluctuations in respect of the currencies of the countries in which we operate,
including US dollars, British pound sterling, Euros, and Canadian dollars.
Accordingly, fluctuations in the exchange rate of world currencies could have a
positive or negative effect on our reported results. We utilize a hedging
program to mitigate our currency risks, but there can be no assurance that we
will not experience currency losses in the future, which could have a material
adverse effect on our business, revenues, operating results and financial
condition. Hiring and Retaining Employees Our future success is dependent on certain key management and technical
personnel. The loss of them or the inability to attract and retain highly
qualified staff and advisors could have a material adverse effect on our
business, revenues, operating results and financial condition. Managing Growth We have a history of growth. The expansion of our business and the increasing
complexity of our product offerings, coupled with the rapid evolution of our
markets, and increasing competition that puts pressure on margins have placed,
and are expected to continue to place, a significant strain on our management
and operational resources and to increase demands on our internal systems,
procedures and controls. Our future operating results will depend on
managements ability to develop and manage growth, enhance our products and
services to respond to market demand, deal with competition and evolving
customer requirements, hire and retain significant numbers of qualified
employees, accurately forecast revenues and control expenses. A decline in the
growth rate of our revenues without a corresponding and timely slowdown in our
expenses or our inability to manage or build future growth efficiently could
have a material adverse effect on our business, revenues, operating results and
financial condition. Future Acquisitions and Investments As part of our business strategy, we may make acquisitions of or significant
investments in businesses or technology that offer complementary products,
services, and technologies. Any acquisition or investment will be accompanied
by common risks, including the difficulty of assimilating the operations and
personnel of the acquired businesses; the potential disruption of management
from our business; the inability of management to maximize the financial and
strategic position of our company or returns from the investment or acquired
businesses; the maintenance of uniform standards, controls, procedures and
policies; and the impairment of relationships with employees and clients as a
result of and integration of the investment, acquisition or new management
personnel.




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##### 



13

Stock Volatility The market price of our common shares has experienced significant fluctuations
and may continue to fluctuate significantly. The market price of our common
shares may be adversely affected by various factors affecting us and our
competitors, such as proposed Internet gaming legislation or enforcement of
existing laws, the announcement of new products or enhancements, innovation,
quarterly variations in revenue and results of operations, changes in earnings
estimates by financial analysts, speculation in the press or analyst community
and general market conditions or market conditions specific to particular
industries, including the Internet and gaming. In addition, the stock market has from time to time experienced extreme price
and volume fluctuations. These company-specific or broad market fluctuations
may adversely affect the market price for our common shares. Anti-online
gaming legislation could also impact our ability to remain listed. Although our common shares are listed and traded on the Toronto Stock Exchange,
the Nasdaq National Market and the London Stock Exchanges Main Market, this
should not imply that there will always be a liquid market in our common shares
and an investment in our common shares may be difficult to realize. In
addition, the availability of three markets in which our shares may trade may
cause liquidity to become fragmented. Dividend On September 11, 2003, CryptoLogics Board of Directors adopted a quarterly
dividend policy, the first ever in our history. The Board declared our
inaugural quarterly dividend of $0.03 per common share, paid on November 24,
2003 to shareholders. A quarterly dividend of $0.03 per common share was paid
to shareholders on March 15, 2004. On May 6, 2004, our Board declared the next
quarterly dividend of $0.03 per share, payable June 15, 2004 to shareholders of
record as at June 8, 2004. Each future quarterly dividend will be subject to
Board approval based on the Companys financial results.




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##### 



14

Item 5: SELECTED CONSOLIDATED FINANCIAL INFORMATION Annual Financial Information The following selected consolidated financial information is qualified by
reference to and should be read in conjunction with the section entitled
Managements Discussion and Analysis and the consolidated financial
statements contained in our Annual Report for the year ended December 31, 2003.
The following table presents selected financial information for each of our
three most recent financial years of on a consolidated basis: (In thousands of US dollars, except per share data)
    
    AuditedFor the years ended December 31
    
    2003
    
    2002
    
    2001Financial DataRevenue
    
    $
    44,211
    
    
    $
    34,427
    
    
    $
    43,550Interest and other income
    
    
    691
    
    
    
    672
    
    
    
    2,215Earnings before special charge
    
    
    9,441
    
    
    
    7,728
    
    
    
    18,078Earnings (loss)
    
    
    9,441
    
    
    
    (2,129
    )
    
    
    18,078EBITDA(1)
    
    
    11,496
    
    
    
    8,609
    
    
    
    17,422Operating cash flow
    
    
    38,700
    
    
    
    9,431
    
    
    
    18,123Cash, equivalents and short term investments
    
    
    60,757
    
    
    
    24,517
    
    
    
    39,559Working capital
    
    
    44,733
    
    
    
    35,812
    
    
    
    54,283Total assets
    
    
    86,066
    
    
    
    52,530
    
    
    
    68,445Long term debt
    
    Nil
    
    
    Nil
    
    
    NilShareholders equity
    
    
    50,546
    
    
    
    41,096
    
    
    
    61,089Per Share DataBefore special charge, net of tax:Earnings per share (basic)
    
    $
    0.77
    
    
    $
    0.63
    
    
    $
    1.33Earnings per share (diluted)
    
    $
    0.75
    
    
    $
    0.60
    
    
    $
    1.21After special charge, net of tax:Earnings (loss) per share (basic)
    
    $
    0.77
    
    
    $
    (0.17
    )
    
    $
    1.33Earnings (loss) per share (diluted)
    
    $
    0.75
    
    
    $
    (0.17
    )
    
    $
    1.21Basic weighted average number of shares (000s)
    
    
    12,245
    
    
    
    12,257
    
    
    
    13,567Diluted weighted average number of shares (000s)
    
    
    12,604
    
    
    
    12,879
    
    
    
    14,944Quarterly dividend per share
    
    $
    0.03
    
    
    Nil
    
    
    Nil
  (1)
    
    Management believes that EBITDA (earnings before interest, taxes,
depreciation and amortization) is a useful supplemental measure of
performance. However, EBITDA is not a recognized earnings measure under
generally accepted accounting principles (GAAP) and does not have a
standardized meaning. Therefore, EBITDA may not be comparable to similar
measures presented by other companies.EBITDA is reconciled to earnings as follows:   (In thousands of US dollars)
    
    2003
    
    2002
    
    2001Earnings (loss)
    
    $
    9,441
    
    
    $
    (2,129
    )
    
    $
    18,078Income taxes (recovery)
    
    
    1,213
    
    
    
    (82
    )
    
    
    1,206Special charge
    
    
    
    
    
    
    10,506
    
    
    
    Interest and other income
    
    
    (691
    )
    
    
    (672
    )
    
    
    (2,215
    )Amortization
    
    
    1,533
    
    
    
    986
    
    
    
    353EBITDA
    
    $
    11,496
    
    
    $
    8,609
    
    
    $
    17,422




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##### 



15

Quarterly Financial Information The following tables set out selected unaudited financial information of our
Company on a consolidated basis for the last eight quarters. Summary of Quarterly Results Fiscal 2003 Quarters(2)
    
    First
    
    Second
    
    Third
    
    Fourth
    
    Annual(In thousands of US dollars, except per share data)Revenue
    
    $
    8,901
    
    
    $
    10,826
    
    
    $
    10,944
    
    
    $
    13,540
    
    
    $
    44,211Stock option expense
    
    
    58
    
    
    
    105
    
    
    
    127
    
    
    
    148
    
    
    
    438Interest income
    
    
    161
    
    
    
    174
    
    
    
    196
    
    
    
    160
    
    
    
    691Earnings
    
    
    1,773
    
    
    
    2,478
    
    
    
    2,157
    
    
    
    3,033
    
    
    
    9,441Before stock option expense:Basic earnings per share
    
    $
    0.15
    
    
    $
    0.21
    
    
    $
    0.19
    
    
    $
    0.26
    
    
    $
    0.81Diluted earnings per share
    
    $
    0.15
    
    
    $
    0.21
    
    
    $
    0.18
    
    
    $
    0.25
    
    
    $
    0.78After stock option expense:Basic earnings per share
    
    $
    0.15
    
    
    $
    0.20
    
    
    $
    0.18
    
    
    $
    0.25
    
    
    $
    0.77Diluted earnings per share
    
    $
    0.15
    
    
    $
    0.20
    
    
    $
    0.17
    
    
    $
    0.23
    
    
    $
    0.75Basic weighted average number of shares (000s)
    
    
    12,206
    
    
    
    12,237
    
    
    
    12,256
    
    
    
    12,280
    
    
    
    12,245Diluted weighted average number of shares (000s)
    
    
    12,216
    
    
    
    12,395
    
    
    
    12,696
    
    
    
    12,972
    
    
    
    12,604
  (2)
    
    Fiscal 2003 results have been restated for the retroactive adoption of
the stock option expense. Fiscal 2002 Quarters
    
    First
    
    Second
    
    Third
    
    Fourth
    
    Annual(In thousands of US dollars, except per share data)Revenue
    
    $
    8,664
    
    
    $
    8,890
    
    
    $
    8,004
    
    
    $
    8,869
    
    
    $
    34,427Interest and other income
    
    
    175
    
    
    
    151
    
    
    
    164
    
    
    
    182
    
    
    
    672Net income before special charge
    
    
    2,204
    
    
    
    2,031
    
    
    
    1,302
    
    
    
    2,191
    
    
    
    7,728Earnings (loss)
    
    
    2,204
    
    
    
    (7,826
    )
    
    
    1,302
    
    
    
    2,191
    
    
    
    (2,129
    )Before special charge, net of tax:Basic earnings per share
    
    $
    0.18
    
    
    $
    0.17
    
    
    $
    0.11
    
    
    $
    0.18
    
    
    $
    0.63Diluted earnings per share
    
    $
    0.16
    
    
    $
    0.16
    
    
    $
    0.11
    
    
    $
    0.18
    
    
    $
    0.60After special charge, net of tax:Basic earnings (loss) per share
    
    $
    0.18
    
    
    $
    (0.65
    )
    
    $
    0.11
    
    
    $
    0.18
    
    
    $
    (0.17
    )Diluted earnings (loss) per share
    
    $
    0.16
    
    
    $
    (0.65
    )
    
    $
    0.11
    
    
    $
    0.18
    
    
    $
    (0.17
    )Basic weighted average number of shares (000s)
    
    
    12,210
    
    
    
    12,092
    
    
    
    12,317
    
    
    
    12,211
    
    
    
    12,257Diluted weighted average number of shares (000s)
    
    
    13,569
    
    
    
    13,100
    
    
    
    12,338
    
    
    
    12,211
    
    
    
    12,879
 Reporting Currency On February 9, 1999, we announced we would be reporting all future financial
information in US dollars, including the financial information contained in our
1998, 1999 and 2000 annual reports.




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##### 



16

Item 6: MANAGEMENTS DISCUSSION AND ANALYSIS The Companys Managements Discussion and Analysis is contained in our Annual
Report for the year ended December 31, 2003 on pages 16 to 31 and is
incorporated by reference in this Annual Information Form. Item 7: MARKET FOR SECURITIES Our common shares have been listed and posted for trading on The Toronto Stock
Exchange since September 30, 1998 under the symbol CRY, on the Nasdaq
National Market since March 20, 2000 under the symbol CRYP, and on the Main
Market of the London Stock Exchange since September 15, 2003 under the symbol
CRP. For additional information regarding our common shares, refer to Note
7, Capital Stock, and on page 47 of the 2003 Annual Report. Description of Share Capital Our authorized capital consists of an unlimited number of common shares. As of
December 31, 2003, there were 12,300,397 common shares issued and outstanding. The common shares entitle holders to one vote per share at all shareholder
meetings. Common shareholders are also entitled to receive any dividends
declared by the Board of Directors. Item 8: DIRECTORS AND OFFICERS The names of the directors and senior officers of our Company at May 6, 2004,
their municipalities of residence, their respective positions with our Company
and the date upon which they were first elected as a director or officer of
CryptoLogic are set out in the below tables: CommonDate of First
    
    Shares HeldName and Municipality
    
    
    
    Election as
    
    as at May 6,of Residence
    
    Principal Occupation
    
    Director(5)/Officer
    
    2004(6)Robert
H. Stikeman(2)(4)
Toronto, Ontario
    
     Chairman of the Board and Director
of the Company Partner, Stikeman, Graham, Keeley &
Spiegel LLP  (a law firm)
    
    March 7, 1996
    
    
    5,000Lorne Abony(1)(2)(4)
Toronto, Ontario
    
     Director of the Company
 CEO, CES Software plc (a technology
company)
    
    May 1, 2003
    
    
    36Randall Abramson(1)(3)(4)
Toronto, Ontario
    
     Director of the Company
 Vice President, Strategic Capital
Partners Inc.,  and CEO of its
affiliate, Strategic Advisors Corp.  (portfolio investment firms)
    
    May 1, 2003
    
    
    8,350Stephen
H. Freedhoff, CA, CFP(1)(3)(4)
Toronto, Ontario
    
     Director of the Company
 Self-employed consultant
    
    May 1, 2003
    
    
    2,000Edward L. Greenspan, Q.C.(2)(3)(4)
Toronto, Ontario
    
     Director of the Company
 Senior partner, Greenspan, White
(a law firm)
    
    May 1, 2003
    
    Nil




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##### 



17

CommonDate of First
    
    Shares HeldName and Municipality
    
    
    
    Election as
    
    as at May 6,of Residence
    
    Principal Occupation
    
    Director(5)/Officer
    
    2004(6)Lewis N. Rose(4)(7)
Toronto, Ontario
    
     Director of the Company
 President and CEO of the Company
    
    July 15, 2002
    
    
    25,000James A. Ryan
Toronto, Ontario
    
     CFO of the Company
    
    January 22, 2002
    
    
    12,100Michael Starzynski
Toronto, Ontario
    
     CTO of the Company
    
    March 17, 2003
    
    NilSerguei Bourenkov(8)
Toronto, Ontario
    
     VP, Research & Systems Architecture
    
    January 14, 2003
    
    
    34,379A. J. Slivinski
Toronto, Ontario
    
     VP, Business Development
    
    January 14, 2003
    
    NilMarilyn Shabot
Toronto, Ontario
    
     VP, Human Resources
    
    January 14, 2003
    
    
    869John FitzGerald
Toronto, Ontario
    
     General Counsel
    
    May 1, 2003
    
    NilKarim Virjee
Toronto, Ontario
    
     Director, Systems, Security &
Network
    
    August 26, 2003
    
    
    869Jenifer Cua
Toronto, Ontario
    
     Director, Treasury
    
    November 4, 2003
    
    
    1,869
 Notes: (1)
    
    Member of audit committee. (2)
    
    Member of corporate governance & compliance committee. (3)
    
    Member of compensation committee. (4)
    
    Member of nominating committee. (5)
    
    Each director is elected annually to hold office until the next annual
meeting of shareholders. (6)
    
    Common shares beneficially owned, directly or indirectly, or exercised
control or direction over by director or officer. (7)
    
    Lewis Rose was appointed Interim President and CEO of the Company on July
15, 2002 and appointed President and CEO on March 7, 2003. (8)
    
    Serguei Bourenkov was Director, Product Development in 2002, having
joined CryptoLogic as one of the founding employees in 1996. He was
appointed Vice President, Research & System Architecture on January 14,
2003. As of May 6, 2004, the directors and officers of the Company, as a group,
beneficially owned, directly or indirectly, or exercised control or direction
over, approximately 1% of the issued and outstanding Common Shares of the
Company. Descriptions of each of the directors and officers set out in the above table
and their respective positions held for the last five years are noted below. Robert H. Stikemanwas named Chairman of the Board in May 2003, has been a
Director since May 2002 and also serves as the Companys Secretary. He has
been a partner for the past 16 years in Stikeman, Graham, Keeley & Spiegel LLP,
a law firm he was instrumental in establishing. His firm acts as outside
counsel to the Company. Mr. Stikeman plays a key role in guiding CryptoLogics
legal and compliance strategies since 1996. He is also Chairman of the
Companys Compliance and Nominating Committees. Lorne Abonyis Chief Executive Officer of CES Software plc since July 2002, an
AIM listed company on the London Stock Exchange. Prior to CES, Mr. Abony was a
venture partner at Elucid Technology Ventures, a private equity and venture
capital firm based in New York, from 2000 to 2002. Before joining Elucid, Mr.
Abony was the founder and President of Petopia from 1998 to 2000, which was an
online pet food and supplies company that raised in excess of $100 million in
venture capital. Petopia was sold to Petco in November 2000. Mr. Abony is a
member of the Law Society of Upper Canada and formerly practiced corporate and
securities law at a large Toronto law firm.




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##### 



18

Randall Abramsonis co-founder and Vice President of Strategic Capital Partners
Inc. and co-founder and Chief Executive Officer of its affiliate, Strategic
Advisors Corp., both Toronto-based portfolio management firms for high net
worth individuals and institutions. Prior to founding Strategic Capital and
Strategic Advisors, Mr. Abramson was a portfolio manager and analyst at wealth
management firm, Connor Clark & Company Ltd. from 1996 to 1998, and prior
thereto, was a portfolio manager and analyst at institutional money manager,
Hodgson Roberton Laing Limited from 1991 to 1996. Stephen H. Freedhoff, CA, CFPhas been a self-employed consultant since July
1999. Previously, he was a partner of a Canadian national accounting firm for
30 years. Mr. Freedhoff is also Chairman of the Companys Audit Committee. Edward L. Greenspan, Q.C., L.L.D., D.C.L.,is the senior partner of the Toronto
law firm of Greenspan, White. He has been practicing in Toronto since 1970, and
received his Queens Counsel in 1982. Mr. Greenspan taught law at the
University of Toronto Law School for approximately 28 years. He has been
involved in some of the most high profile cases in Canada. Mr. Greenspan was a
Director of Alliance Communications Corp. from June 1993 to September 1998.
Mr. Greenspan is also Chairman of the Companys Compensation Committee. Lewis N. Rose, CAwas appointed Interim President and Chief Executive Officer
on July 15, 2002, and was appointed President and Chief Executive Officer on
March 7, 2003. Mr. Rose was also appointed to the Board on May 1, 2003. He
has two decades of experience in the consumer products, entertainment and
financial services sectors in leadership roles at some of North Americas
best-known companies. From 2000 to 2002, he was CEO of E-TV Interactive
Technologies Inc., a private interactive technology company. From 1998 to 2000,
he was President and a Director of Alliance Atlantis Communications Inc., one
of the largest publicly traded television and film entertainment companies in
Canada, and President and a Director of its predecessor, Atlantis
Communications Inc., from 1997 to 1998. Mr. Rose was previously Chief Financial
Officer and a Director of Maple Leaf Foods Inc., the largest publicly traded
food-processing company in Canada, and President of Maple Leafs Grocery
Products Division. Before that, Mr. Rose was Assistant Vice President in the
Merger and Acquisition Group of Wood Gundy Inc., now CIBC World Markets. James A. Ryan, CAwas appointed Chief Financial Officer on January 22, 2002.
A Chartered Accountant with more than 17 years of operational and financial
management experience, Mr. Ryan brings experience in acquisitions,
divestitures, debt and equity financing, financial intermediation, corporate
restructuring and investor relations. Prior to joining CryptoLogic, he was
Chief Financial Officer and Secretary of Procuron Inc., an Internet
business-to-business marketplace company, from 2000 to 2002. From 1996 to
2000, he was Chief Financial Officer, Secretary and Director of Systems
Xcellence, a publicly traded software development company in the healthcare
transaction processing market. Mr. Ryan also was previously Vice President of
Business Development of MetCan Information Technologies Inc., and Vice
President and Chief Financial Officer of Epson Canada Limited, the Canadian
affiliate of global technology company, Seiko Epson Corporation. Michael Starzynskiwas appointed Chief Technology Officer on March 17, 2003,
and has more than 20 years of global information technology experience in both
the telecommunication and financial services sectors at some of North Americas
largest companies as well as leading entrepreneurial organizations. From 2000
to 2003, he was Chief Technology Officer of Financial Models Company, a leading
provider of investment management systems and services. From 1998 to 2000, he
was Chief Technology Officer of SRG Software Inc., a software and consulting
services company. Previous positions included Chief Technology Architect at
CGI Canada and a 13-year career at Bell Canada, Canadas leading
telecommunication service provider. Serguei Bourenkovwas appointed Vice President, Research & Systems Architecture
on January 14, 2003 and has more than a decade of software development and
technical expertise. He joined CryptoLogic in 1996 after moving to Canada from
Moscow, Russia. His career has spanned development of an equity fund
management system, medical 3D visualization software and computer games as well
as a currency trading system for Russias major bank. He also worked at the
Institute of Acoustics in Russia modeling long-range underwater sound
propagation, signal processing and 3D-graphics. A.J. Slivinskiwas appointed Vice President of Business Development on January
14, 2003, and brings more than 15 years of North American and international
experience in sales and marketing. From 1998 to 2002, he has held senior
business development positions at Maple Leaf Consumer Foods Inc., the largest
publicly traded food-processing company in Canada. Most recently, he was Director of Emerging
Markets at Maple Leaf Consumer Foods. As Vice President of International Sales
and Marketing at Luiginos Inc. from 1996 to 1998, Mr. Slivinski managed a
multi-million dollar business unit and developed new international
opportunities.




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19

Marilyn Shabotwas appointed Vice President, Human Resources on January 14,
2003, having joined CryptoLogic in March 2002 as Director, Human Resources.
Ms. Shabot brings more than 15 years in human resources with extensive
experience in recruiting at all levels, department set-up, policy development,
group benefit design, training assessment and implementation, and employee
relations. From 2000 to 2002, she was Manager of Human Resources with
Documentum Canada (The Bulldog Group Inc.), a leading provider of content
management solutions. From 1997 to 2000, Ms. Shabot was Manager of Human
Resources with Simcoe Parts Service Inc., an affiliate of Honda Canada
Manufacturing. John FitzGeraldwas appointed General Counsel on May 1 2003. Prior to joining
CryptoLogic, Mr. FitzGerald held the positions of Chief Operating Officer and
General Counsel at Ball Brewing Company Limited from 2001 to 2002. In 1998, he
began his legal career with the law firm Fasken Campbell Godfrey, now Fasken
Martineau, focusing primarily on mergers and acquisitions and public finance.
In 1998 while at Fasken Martineau, Mr. FitzGerald was seconded to the Ontario
Securities Commission. Karim Virjeeis Director, Systems, Security and Networks. He joined
CryptoLogic in October 2001 as Director of Security and Systems Design, and
assumed increasing responsibilities to include Network Infrastructure and
Operations as well appointed Security Officer in August 2003. Mr. Virjee
brings more than 18 years in IT systems, security and network design and
management experience. Prior to joining CryptoLogic, Mr. Virjee was Senior
Director, Engineering and Senior Security Architect at Datawire Communications
Network. From 2000 to 2001, he was Senior Manager and Security Architect for
E-Business at Nortel Networks, a leading Canadian provider of communications
technology and infrastructure. Mr. Virjee has lectured on network security and
data communication from 1999 to 2000 at Seneca College, concurrent with his
position as Architect and Manager of Network Security for Intria-HP Inc. Jenifer Cua, CGAis Director, Treasury and was appointed as an officer of
CryptoLogic on November 4, 2003. She joined CryptoLogic in May 1998 as Senior
Accountant and held the position of Corporate Controller from 2000 to 2002.
Ms. Cua has 10 years of accounting and controller experience and is responsible
for the Companys treasury management, budgeting, forecasting and fraud
management functions. Item 9: ADDITIONAL INFORMATION Additional information regarding the Company, including directors and
officers remuneration and indebtedness, principal holders of the Companys
securities, options to purchase securities and interests of insiders in
material transactions, if applicable, is contained in the Companys information
circular dated April 13, 2004 in respect of the Companys annual and special
meeting of shareholders to be held on May 11, 2004. Additional financial
information is provided in the Companys comparative consolidated financial
statements and notes thereto for the fiscal year ended December 31, 2003 is
provided in the Companys 2003 Annual Report. Copies of the above documents and additional copies of this Annual Information
Form may be obtained upon request by contacting the Companys Investor
Relations Department at head office located at 1867 Yonge St., 7th Floor,
Toronto, Ontario, Canada, M4S 1Y5, telephone: 416-545-1455, fax: 416-545-1454,
e-mail: investor.relations@cryptologic.com and have been filed and are
available on SEDAR (www.sedar.com).