**Table of Contents**

| ****x**** | **QUARTERLY REPORT PURSUANT TO SECTION 13        OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934** |
|-----------|----------------------------------------------------------------------------------------------------|
| ****o**** | ********TRANSITION        REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT        OF 1934******** |
|-----------|------------------------------------------------------------------------------------------------------------------------|
| **Illinois**                 | **75-2375969**                                    |
|------------------------------|---------------------------------------------------|
| **(State of incorporation)** | **(I.R.S. employer identification          no.)** |

| **Large accelerated filer o**                            |   |   | **Accelerated filer o**         |   |
|----------------------------------------------------------|--------|--------|---------------------------------|--------|
|                                                     |   |   |                            |   |
| **Non-accelerated filer o**                              |   |   | **Smaller reporting company x** |   |
| **(Do not check if a smaller reporting        company)** |   |   |

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| **PART I**                                                                                 | **FINANCIAL INFORMATION**                                                                               | **Page No.** |
|--------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------|--------------|
|                                                                                       |                                                                                                    |         |
| **Item 1.**                                                                                | **Unaudited Consolidated Financial      Statements:**                                                   | ** **   |
| ****                                                                                       | ** **                                                                                              | ** **   |
| ****                                                                                       | **Consolidated Balance Sheets      at March 31, 2009 (unaudited) and December 31, 2008**                | **3**        |
| ****                                                                                       | ** **                                                                                              | ** **   |
| ****                                                                                       | **Unaudited Consolidated      Statements of Operations for Three Months Ended March 31, 2009 and 2008** | **4**        |
| ****                                                                                       | ** **                                                                                              | ** **   |
| ****                                                                                       | **Unaudited Consolidated Statements      of Cash Flows for Three Months Ended March 31, 2009 and 2008** | **5**        |
| ****                                                                                       | ** **                                                                                              | ** **   |
| ****                                                                                       | **Notes to Unaudited Consolidated      Financial Statements**                                           | **6**        |
| ****                                                                                       |                                                                                                    | ** **   |
| **Item 2.**                                                                                | **Management's Discussion and      Analysis of Financial Condition and Results of Operations**          | **15**       |
|                                                                                       |                                                                                                    |         |
| **Item 3.**                                                                                | **Quantitative and Qualitative      Disclosures about Market Risk**                                     | **24**       |
|                                                                                       |                                                                                                    |         |
| **Item 4T.**                                                                               | **Controls and Procedures**                                                                             | **24**       |
| ** **                                                                                 | ** **                                                                                              |         |
| **PART II**                                                                                | **OTHER INFORMATION**                                                                                   | ** **   |
|                                                                                       |                                                                                                    |         |
| **Item 1.**                                                                                | **Legal Proceedings**                                                                                   | **25**       |
|                                                                                       |                                                                                                    | ** **   |
| **Item 1A.**                                                                               | **Risk Factors**                                                                                        | **25**       |
|                                                                                       |                                                                                                    | ** **   |
| **Item 2.**                                                                                | **Unregistered Sales of Equity      Securities and Use of Proceeds**                                    | **25**       |
|                                                                                       |                                                                                                    | ** **   |
| **Item 3.**                                                                                | **Defaults in Senior Securities**                                                                       | **25**       |
|                                                                                       |                                                                                                    | ** **   |
| **Item 4.**                                                                                | **Submission of Matters to      a Vote of Security Holders**                                            | **25**       |
|                                                                                       |                                                                                                    | ** **   |
| **Item 5.**                                                                                | **Other Information**                                                                                   | **25**       |
|                                                                                       |                                                                                                    | ** **   |
| **Item 6.**                                                                                | **Exhibits**                                                                                            | **26**       |
|                                                                                       |                                                                                                    | ** **   |
| **Signatures**                                                                             | **27**                                                                                                  |
| **Exhibit      31.1 Certification of Chief Executive Officer**                             | **28**                                                                                                  |
| **Exhibit      31.2 Certification of Chief Financial Officer**                             | **29**                                                                                                  |
| **Exhibit      32.1 Certification of Chief Executive Officer and Chief Financial Officer** | **30**                                                                                                  |

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**Table of Contents**

| **TERRA NOVA FINANCIAL GROUP, INC. AND        SUBSIDIARIES         CONSOLIDATED BALANCE SHEETS         (UNAUDITED)**                                                                   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                        |   | **March 31,         2009** |  |  |  | December 31,         2008 |   |
| **ASSETS**                                                                                                                                                                             |
| Cash and cash equivalents                                                                                                                                                              | **$** | **6,244,079** |   |   | $ | 7,889,553 |   |
| Cash segregated in compliance with federal      regulations                                                                                                                            |   | **136,391,934** |   |   |   | 141,159,364 |   |
| Receivables from brokers,      dealers and clearing organizations                                                                                                                      |   | **14,613,008** |   |   |   | 13,568,459 |   |
| Receivables from customers and non-customers,      net                                                                                                                                 |   | **5,623,845** |   |   |   | 4,858,360 |   |
| Property and equipment, net                                                                                                                                                            |   | **1,218,325** |   |   |   | 1,221,066 |   |
| Capitalized software development costs, net                                                                                                                                            |   | **1,929,728** |   |   |   | 2,060,015 |   |
| Intangible assets, net                                                                                                                                                                 |   | **3,768,976** |   |   |   | 4,111,514 |   |
| Income tax receivables                                                                                                                                                                 |   | **716,264** |   |   |   | 1,446,264 |   |
| Goodwill                                                                                                                                                                               |   | **7,501,408** |   |   |   | 7,501,408 |   |
| Deferred income taxes, net                                                                                                                                                             |   | **1,994,761** |   |   |   | 1,784,761 |   |
| Other assets                                                                                                                                                                           |   | **1,162,681** |   |   |   | 1,346,764 |   |
|            Total      assets                                                                                                    | **$** | **181,165,009** |   |   | $ | 186,947,528 |   |
|                                                                                                                                                                                   |   |   |   |   |   |   |   |
| **LIABILITIES AND SHAREHOLDERS' EQUITY**                                                                                                                                               |
|                                                                                                                                                                                   |  | **** |   |   |   |  |   |
| Payables to brokers, dealers and clearing organizations                                                                                                                                |   | **670,152** |   |   |   | 913,621 |   |
| Payables to customers and      non-customers                                                                                                                                           |   | **146,588,408** |   |   |   | 151,970,566 |   |
| Accounts payable and accrued expenses                                                                                                                                                  |   | **2,668,444** |   |   |   | 2,525,692 |   |
|            Total      liabilities                                                                                               |   | **149,927,004** |   |   |   | 155,409,879 |   |
|                                                                                                                                                                                   |   |   |   |   |   |   |   |
| **Commitments and contingencies**                                                                                                                                                      |   |   |   |   |   |   |   |
|                                                                                                                                                                                   |   |   |   |   |   |   |   |
| **Shareholders' equity**                                                                                                                                                               |   |   |   |   |   |   |   |
| Common stock; $0.01 par value; 150,000,000      shares authorized; 25,482,942 shares           issued and outstanding at March 31, 2009 and December      31, 2008 |   | **254,829** |   |   |   | 254,829 |   |
| Additional paid-in capital                                                                                                                                                             |   | **52,035,583** |   |   |   | 52,005,418 |   |
| Accumulated deficit                                                                                                                                                                    |   | **(21,052,407** | **)** |   |   | (20,722,598 | ) |
|            Total      shareholders' equity                                                                                      |   | **31,238,005** |   |   |   | 31,537,649 |   |
|            Total      liabilities and shareholders' equity                                                                      | **$** | **181,165,009** |   |   | $ | 186,947,528 |   |
|                                                                                                                                                                                   |   |   |   |   |   |   |   |
|                                                                                                                                                                                   |   |   |   |   |   |   |   |
| See accompanying notes to unaudited consolidated        financial statements.                                                                                                          |

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**Table of Contents**

| **TERRA NOVA FINANCIAL GROUP, INC.          AND SUBSIDIARIES           CONSOLIDATED STATEMENTS OF OPERATIONS           (UNAUDITED)** |
|--------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                 | **Three Months Ended March 31,** |
|                                                                                                                                      |   | **2009** |   |   |   | 2008 |   |
| **REVENUES**                                                                                                                         |   |  |   |   |   |  |   |
| Commissions and fees                                                                                                                 | **$** | **6,720,234** |   |   | $ | 8,237,980 |   |
|                                                                                                                                 |   |   |   |   |   |   |   |
| Interest income                                                                                                                      |   | **420,276** |   |   |   | 2,070,884 |   |
| Interest expense on brokerage accounts                                                                                               |   | **284** |   |   |   | 608,743 |   |
|          Net        interest income                                                     |   | **419,992** |   |   |   | 1,462,141 |   |
|                                                                                                                                 |   | **** |   |   |   |  |   |
| Software fees, net                                                                                                                   |   | **257,518** |   |   |   | 159,003 |   |
| Other revenue                                                                                                                        |   | **461** |   |   |   | 84,781 |   |
|                                                                                                                                 |   | **** |   |   |   |  |   |
|          Net        revenues                                                            |   | **7,398,205** |   |   |   | 9,943,905 |   |
|                                                                                                                                 |   | **** |   |   |   |  |   |
| **EXPENSES**                                                                                                                         |   | **** |   |   |   |  |   |
| Commissions and clearing                                                                                                             |   | **2,534,779** |   |   |   | 2,608,227 |   |
| Compensation and benefits                                                                                                            |   | **2,365,888** |   |   |   | 3,022,051 |   |
| Software and market data                                                                                                             |   | **903,770** |   |   |   | 1,654,011 |   |
| Advertising and promotional                                                                                                          |   | **137,230** |   |   |   | 181,989 |   |
| Professional fees                                                                                                                    |   | **686,921** |   |   |   | 796,851 |   |
| Communications and information technology                                                                                            |   | **239,190** |   |   |   | 256,571 |   |
| Depreciation and amortization                                                                                                        |   | **563,267** |   |   |   | 557,563 |   |
| Other general and administrative expenses                                                                                            |   | **506,969** |   |   |   | 466,515 |   |
|                                                                                                                                 |   | **** |   |   |   |  |   |
|          Total        expenses                                                          |   | **7,938,014** |   |   |   | 9,543,778 |   |
|                                                                                                                                 |   | **** |   |   |   |  |   |
| Income (loss) before income taxes                                                                                                    |   | **(539,809** | **)** |   |   | 400,127 |   |
|                                                                                                                                 |   | **** |   |   |   |  |   |
| Income tax benefit (provision)                                                                                                       |   | **210,000** |   |   |   | (228,000 | ) |
|                                                                                                                                 |   | **** |   |   |   |  |   |
| Net income (loss)                                                                                                                    |   | **(329,809** | **)** |   |   | 172,127 |   |
|                                                                                                                                 |   | **** |   |   |   |  |   |
| Dividends on preferred stock                                                                                                         |   | **-** |   |   |   | (17,574 | ) |
|                                                                                                                                 |   | **** |   |   |   |  |   |
| Net income (loss) attributable to common        shareholders                                                                         | **$** | **(329,809** | **)** |   | $ | 154,553 |   |
|                                                                                                                                 |   |   |   |   |   |   |   |
| Net income (loss) per common share:                                                                                                  |   |   |   |   |   |   |   |
| Basic                                                                                                                                | **$** | **(0.01** | **)** |   | $ | 0.01 |   |
|                                                                                                                                 |   |   |   |   |   |   |   |
| Diluted                                                                                                                              | **$** | **(0.01** | **)** |   | $ | 0.01 |   |
|                                                                                                                                 |   |   |   |   |   |   |   |
| Weighted average common shares outstanding:                                                                                          |   |   |   |   |   |   |   |
| Basic                                                                                                                                |   | **25,482,942** |   |   |   | 26,421,079 |   |
|                                                                                                                                 |   |   |   |   |   |   |   |
| Diluted                                                                                                                              |   | **25,482,942** |   |   |   | 26,421,079 |   |
|                                                                                                                                 |   |   |   |   |   |   |   |
| See accompanying notes to unaudited          consolidated financial statements.                                                      |

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**Table of Contents**

| **TERRA NOVA FINANCIAL GROUP, INC.            AND SUBSIDIARIES             CONSOLIDATED STATEMENTS OF CASH FLOWS             (UNAUDITED)** |
|--------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                            | **Three Months Ended March 31,** |
|                                                                                                                                            |   | **2009** |   |   |   | 2008 |   |
| **OPERATING ACTIVITIES**                                                                                                                   |   |  |   |   |   |  |   |
| Net income (loss)                                                                                                                          | **$** | **(329,809** | **)** |   | $ | 172,127 |   |
| Adjustments to reconcile net income (loss)          to net cash provided by (used in) operating activities:                                |   |  |   |   |   |  |   |
| Share-based compensation                                                                                                                   |   | **30,165** |   |   |   | 42,484 |   |
| Depreciation and amortization                                                                                                              |   | **563,267** |   |   |   | 557,563 |   |
| Deferred income taxes                                                                                                                      |   | **(210,000** | **)** |   |   | 42,945 |   |
| Gain on extinguishment of liabilities                                                                                                      |   | **(60,626** | **)** |   |   | (354,000 | ) |
| Loss on write-off of          assets                                                                                                       |   | **-** |   |   |   | 29,857 |   |
| Change in operating assets and liabilities:                                                                                                |   |  |   |   |   |  |   |
| (Increase) decrease in          assets:                                                                                                    |   |  |   |   |   |  |   |
| Cash segregated in compliance with federal          regulations                                                                            |   | **4,767,430** |   |   |   | (20,618,626 | ) |
| Receivables from brokers,          dealers and clearing organizations                                                                      |   | **(1,044,549** | **)** |   |   | 5,310,627 |   |
| Receivables from customers and non-customers                                                                                               |   | **(765,485** | **)** |   |   | 25,904,283 |   |
| Income tax receivables                                                                                                                     |   | **730,000** |   |   |   | - |   |
| Other assets                                                                                                                               |   | **184,083** |   |   |   | (183,454 | ) |
| Increase (decrease) in          liabilities:                                                                                               |   |  |   |   |   |  |   |
| Payables to brokers, dealers and clearing          organizations                                                                           |   | **(243,469** | **)** |   |   | 181,340 |   |
| Payables to customers          and non-customers                                                                                           |   | **(5,382,158** | **)** |   |   | (1,759,879 | ) |
| Accounts payable and accrued expenses                                                                                                      |   | **203,378** |   |   |   | 1,286,042 |   |
| Income tax liability                                                                                                                       |   | **-** |   |   |   | (450,118 | ) |
|                                                                                                                                       |   |  |   |   |   |  |   |
| Net cash provided by          (used in) operating activities                                                                               |   | **(1,557,773** | **)** |   |   | 10,161,191 |   |
|                                                                                                                                       |   |  |   |   |   |  |   |
| **INVESTING ACTIVITIES**                                                                                                                   |   |  |   |   |   |  |   |
| Purchases of property and equipment                                                                                                        |   | **(87,701** | **)** |   |   | (161,103 | ) |
| Capitalization of software          development costs                                                                                      |   | **-** |   |   |   | (116,563 | ) |
|                                                                                                                                       |   |  |   |   |   |  |   |
| Net cash used in investing          activities                                                                                             |   | **(87,701** | **)** |   |   | (277,666 | ) |
|                                                                                                                                       |   |  |   |   |   |  |   |
| **FINANCING ACTIVITIES**                                                                                                                   |   |  |   |   |   |  |   |
| Repurchase and retirement of common stock                                                                                                  |   | **-** |   |   |   | (629,199 | ) |
| Preferred dividends paid                                                                                                                   |   | **-** |   |   |   | (38,737 | ) |
| Net payments on line of credit                                                                                                             |   | **-** |   |   |   | (10,848,000 | ) |
|                                                                                                                                       |   |  |   |   |   |  |   |
| Net cash used in financing activities                                                                                                      |   | **-** |   |   |   | (11,515,936 | ) |
|                                                                                                                                       |   |  |   |   |   |  |   |
| Net decrease in cash and cash equivalents                                                                                                  |   | **(1,645,474** | **)** |   |   | (1,632,411 | ) |
| Cash and cash equivalents          at beginning of period                                                                                  |   | **7,889,553** |   |   |   | 7,937,880 |   |
| Cash and cash equivalents at end of period                                                                                                 | **$** | **6,244,079** |   |   | $ | 6,305,469 |   |
|                                                                                                                                       |   |   |   |   |   |   |   |
| Supplemental Disclosure          of Cash Flow Information:                                                                                 |   |   |   |   |   |   |   |
| Cash paid for interest                                                                                                                     | **$** | **284** |   |   | $ | 608,743 |   |
|                                                                                                                                       |   |   |   |   |   |   |   |
| Cash received (paid)          for income taxes                                                                                             | **$** | **696,322** |   |   | $ | (110,000 | ) |
|                                                                                                                                       |   |   |   |   |   |   |   |
| Supplemental Disclosure          of Non-Cash Investing and Financing Activities:                                                           |   |   |   |   |   |   |   |
| Preferred stock dividends accrued                                                                                                          | **$** | **-** |   |   | $ | 17,574 |   |
|                                                                                                                                       |   |   |   |   |   |   |   |
| See accompanying notes to unaudited            consolidated financial statements.                                                          |

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**Table of Contents**

| • | Securities and Exchange Commission ("SEC")      as a broker-dealer                  |
|--------|-------------------------------------------------------------------------------------|
| • | Financial Industry Regulatory Authority ("FINRA")      as a broker-dealer           |
| • | National Futures Association ("NFA") as a futures      commission merchant          |
| • | Commodity Futures Trading Commission ("CFTC")      as a futures commission merchant |

| • | The Depository Trust Company             |
|--------|------------------------------------------|
| • | National Securities Clearing Corporation |
| • | The Options Clearing Corporation         |

| • | Chicago Stock Exchange  |
|--------|-------------------------|
| • | CBOE Stock Exchange     |
| • | ISE Stock Exchange      |
| • | National Stock Exchange |
| • | NYSE Arca Equities      |
| • | NYSE Amex Equities      |
| • | NYSE Euronext           |
| • | NASDAQ Stock Market     |
| • | NASDAQ OMX BX           |

| • | Boston Options Exchange           |
|--------|-----------------------------------|
| • | NYSE Arca Options                 |
| • | NASDAQ OMX PHLX                   |
| • | NYSE Amex Options                 |
| • | International Securities Exchange |

| • | Securities Investor Protection Corporation |
|--------|--------------------------------------------|

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**Table of Contents**

| • | Market Wise Stock Trading School, LLC ("MW      School"), provides analysis tools to individuals and entities |
|--------|---------------------------------------------------------------------------------------------------------------|
| • | Market Wise Securities, LLC ("MW Securities"),      a FINRA broker-dealer                                     |

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**Table of Contents**

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**Tableof Contents**

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**Table of Contents**

|   |                                             |           |
|--------|--------------------------------------------------|----------------|
|   |                                                  | March 31, 2009 |   | March 31, 2008 |   |
|   | Weighted average shares outstanding      - Basic |           | 25,482,942 |   |   |   | 26,421,079 |   |   |
|   | Weighted average shares outstanding - Diluted    |           | 25,482,942 |   |   |   | 26,421,079 |   |   |
|   |                                             |           |

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**Table of Contents**

|   |                                                                                                                              | **Three Months Ended March 31,** |            |
|--------|------------------------------------------------------------------------------------------------------------------------------|----------------------------------|-----------------|
|   |                                                                                                                              |                             | **2009**        |   |   |   | 2008 |   |   |
|   | **Revenues:**                                                                                                                |                             | **(Unaudited)** |   |   |   | (Unaudited) |   |   |
|   | **Brokerage Services**                                                                                                       |                             |            |   |   |   |   |   |   |
|   | Revenues, excluding interest                                                                                                 | **$**                            | **6,720,239**   |   |   | $ | 8,313,755 |   |   |
|   | Interest revenue                                                                                                             |                             | **420,271**     |   |   |   | 2,070,876 |   |   |
|   | Interest expense                                                                                                             |                             | **(284**        | **)** |   |   | (608,743 | ) |   |
|   | Totals                                                                                                                       |                             | **7,140,226**   |   |   |   | 9,775,888 |   |   |
|   |                                                                                                                         |                             |                 |   |   |   |  |   |   |
|   | **Software Services**                                                                                                        |                             |                 |   |   |   |  |   |   |
|   | Revenues                                                                                                                     |                             | **568,356**     |   |   |   | 555,722 |   |   |
|   |                                                                                                                         |                             |                 |   |   |   |  |   |   |
|   | Elimination of intercompany charges from             the Software segment to Brokerage segment |                             | **(310,838**    | **)** |   |   | (396,719 | ) |   |
|   | Totals                                                                                                                       |                             | **257,518**     |   |   |   | 159,003 |   |   |
|   |                                                                                                                         |                             |                 |   |   |   |  |   |   |
|   | **Corporate and Unallocated**                                                                                                |                             |                 |   |   |   |  |   |   |
|   | Revenues                                                                                                                     |                             | **461**         |   |   |   | 9,014 |   |   |
|   |       Net      revenues                                                                        | **$**                            | **7,398,205**   |   |   | $ | 9,943,905 |   |   |
|   |                                                                                                                         |                             |            |   |   |   |   |   |   |
|   | **Depreciation and amortization:**                                                                                           |                             |            |   |   |   |   |   |   |
|   | Brokerage Services                                                                                                           | **$**                            | **390,006**     |   |   | $ | 384,837 |   |   |
|   | Software Services                                                                                                            |                             | **75,067**      |   |   |   | 73,355 |   |   |
|   | Corporate and Unallocated                                                                                                    |                             | **98,194**      |   |   |   | 99,371 |   |   |
|   | Totals                                                                                                                       | **$**                            | **563,267**     |   |   | $ | 557,563 |   |   |
|   |                                                                                                                         |                             |            |   |   |   |   |   |   |
|   | **Income (loss) before      income taxes:**                                                                                  |                             |            |   |   |   |   |   |   |
|   | Brokerage Services                                                                                                           | **$**                            | **327,042**     |   |   | $ | 1,095,149 |   |   |
|   | Software Services                                                                                                            |                             | **(77,054**     | **)** |   |   | (303,441 | ) |   |
|   | Corporate and Unallocated                                                                                                    |                             | **(789,797**    | **)** |   |   | (391,581 | ) |   |
|   | Totals                                                                                                                       | **$**                            | **(539,809**    | **)** |   | $ | 400,127 |   |   |
|   |                                                                                                                         |                             |            |   |   |   |   |   |   |
|   |                                                                                                                              |                             | **March 31,**   |   |   |   | December 31, |   |   |
|   | **Total Assets:**                                                                                                            |                             | **2009**        |   |   |   | 2008 |   |   |
|   | Brokerage Services                                                                                                           | **$**                            | **176,260,788** |   |   | $ | 181,868,725 |   |   |
|   | Software Services                                                                                                            |                             | **755,978**     |   |   |   | 733,125 |   |   |
|   | Corporate and Unallocated                                                                                                    |                             | **4,148,243**   |   |   |   | 4,345,678 |   |   |
|   | Total assets                                                                                                                 | **$**                            | **181,165,009** |   |   | $ | 186,947,528 |   |   |
|   |                                                                                                                         |                             |            |   |   |   |   |   |   |

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**Table of Contents**

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**Table of Contents**

|                        |
|-----------------------------|
|                             |   |   |   |   | Net capital requirement |   | Excess net capital |
|                             |   | Net Capital |   |   |   | FINRA |   |   |   | CFTC |   |   |   | FINRA |   |   |   | CFTC |   |
| Terra Nova Financial, LLC   | $ | 11,990,454 |   |   | $ | 1,500,000 |   |   | $ | 500,000 |   |   | $ | 10,490,454 |   |   | $ | 11,490,454 |   |
| Market Wise Securities, LLC | $ | 29,823 |   |   | $ | 5,000 |   |   | $ | - |   |   | $ | 24,823 |   |   | $ | - |   |
|                        |

|   |                                          |   |
|--------|-----------------------------------------------|--------|
|   | Employee      Stock Option and Warrant Plans  |   | Authorized |   |   |   | Outstanding |   |   |   | Available |   |   |
|   | 2005 Long-Term Incentive      Plan ("LTIP")   |   | 1,314,767 |   |   |   | 533,024 |   |   |   | 781,743 |   |   |
|   | 2006 Warrant Incentive      Plan ("2006 WIP") |   | 3,500,000 |   |   |   | 3,027,500 |   |   |   | 472,500 |   |   |
|   | Balance at March 31, 2009                     |   | 4,814,767 |   |   |   | 3,560,524 |   |   |   | 1,254,243 |   |   |
|   |                                          |   |

|   |                                  |   |
|--------|---------------------------------------|--------|
|   | Employee      Stock Options           |   | Employee         Stock Options        Outstanding |   | Weighted         Average         Exercise Price |   | Weighted         Average         Remaining         Contract Term         (in years) |   |   | Aggregate        Intrinsic Value |   |   |
|   | Balance at December 31, 2008          |   |   | 589,274 |   |   | $ | 1.71 |   |   |   | 3.7 |   |   | $ | - |   |   |
|   | Granted                               |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |
|   | Exercised                             |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |
|   | Cancelled                             |   |   | (56,250 | ) |   |   | 1.65 |   |   |   | - |   |   |   | - |   |   |
|   | Balance at March 31, 2009             |   |   | 533,024 |   |   | $ | 1.71 |   |   |   | 3.4 |   |   | $ | - |   |   |
|   | Options exercisable at March 31, 2009 |   |   | 235,512 |   |   | $ | 1.84 |   |   |   | 3.3 |   |   | $ | - |   |   |
|   |                                  |   |

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|   |                                   |   |
|--------|----------------------------------------|--------|
|   | Employee      Warrants                 |   | Employee         Warrants        Outstanding |   | Weighted         Average         Exercise Price |   | Weighted         Average         Remaining         Contract Term         (in years) |   |   | Aggregate        Intrinsic Value |   |   |
|   | Balance at December 31, 2008           |   |   | 3,027,500 |   |   | $ | 2.56 |   |   |   | 2.6 |   |   | $ | - |   |   |
|   | Granted                                |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |
|   | Exercised                              |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |
|   | Cancelled                              |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |
|   | Balance at March 31, 2009              |   |   | 3,027,500 |   |   | $ | 2.56 |   |   |   | 2.3 |   |   | $ | - |   |   |
|   | Warrants exercisable at March 31, 2009 |   |   | 1,701,250 |   |   | $ | 2.58 |   |   |   | 2.3 |   |   | $ | - |   |   |
|   |                                   |   |

|                                      |
|-------------------------------------------|
|                                           |   |   |   | March 31, 2009 |   | December 31, 2008 |
|                                           |   | Estimated         Useful Life in         Years |   | Property and        equipment |   | Capitalized         software        development         costs |   | Property and        equipment |   | Capitalized         software        development         costs |
| Computer and software                     |   | 3-5 |   | $ | 550,228 |   |   | $ | 2,780,628 |   |   | $ | 668,531 |   |   | $ | 2,780,628 |   |
| Furniture, fixtures and equipment         |   | 3-7 |   |   | 1,187,548 |   |   |   | - |   |   |   | 1,185,672 |   |   |   | - |   |
| Leasehold improvements                    |   | 5-10 |   |   | 119,589 |   |   |   | - |   |   |   | 119,590 |   |   |   | - |   |
|                                      |   |   |   |   | 1,857,365 |   |   |   | 2,780,628 |   |   |   | 1,973,793 |   |   |   | 2,780,628 |   |
|                                      |   |   |   |   |  |   |   |   |  |   |   |   |  |   |   |   |  |   |
| Accumulated depreciation and amortization |   |   |   |   | (639,040 | ) |   |   | (850,900 | ) |   |   | (752,727 | ) |   |   | (720,613 | ) |
| Net balance                               |   |   |   | $ | 1,218,325 |   |   | $ | 1,929,728 |   |   | $ | 1,221,066 |   |   | $ | 2,060,015 |   |
|                                      |

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**Table of Contents**

|   |                                                      |           |
|--------|-----------------------------------------------------------|----------------|
|   | Financial instruments owned, at fair      value:          | March 31, 2009 |   |
|   | Money market funds      held in cash and cash equivalents | $              | 4,906,764 |   |   |
|   | U.S. Treasury securities held as clearing      deposits   |           | 5,147,939 |   |   |
|   | Total                                                     | $              | 10,054,703 |   |   |
|   |                                                      |           |

|                                                      |
|-----------------------------------------------------------|
|                                                      |   | Quoted Prices        in Active         Markets for         Identical         Assets |   | Significant         Other         Observable        Inputs |   | Significant        Unobservable        Inputs |   |   |   |   |
| Financial      instruments owned, at fair value:          |   |   | Level 1 |   |   |   | Level 2 |   |   |   | Level 3 |   |   |   | Total |   |
| Money market funds held in      cash and cash equivalents |   | $ | 4,906,764 |   |   | $ | - |   |   | $ | - |   |   | $ | 4,906,764 |   |
| U.S. Treasury securities held as clearing deposits        |   |   | 5,147,939 |   |   |   | - |   |   |   | - |   |   |   | 5,147,939 |   |
| Total                                                     |   | $ | 10,054,703 |   |   | $ | - |   |   | $ | - |   |   | $ | 10,054,703 |   |
|                                                      |

|   |                                     |   |
|--------|------------------------------------------|--------|
|   |                                          |   | March 31, 2009 |   | December 31, 2008 |   |
|   |                                          |   |   | Receivables |   |   |   | Payables |   |   |   | Receivables |   |   |   | Payables |   |   |
|   | Securities borrowed/loaned               |   | $ | 7,090,614 |   |   | $ | - |   |   | $ | 4,332,350 |   |   | $ | - |   |   |
|   | Clearing deposits & receivables/payables |   |   | 7,522,394 |   |   |   | 670,152 |   |   |   | 9,236,109 |   |   |   | 913,621 |   |   |
|   |                                     |   |   |  |   |   |   |  |   |   |   |  |   |   |   |  |   |   |
|   | Total                                    |   | $ | 14,613,008 |   |   | $ | 670,152 |   |   | $ | 13,568,459 |   |   | $ | 913,621 |   |   |
|   |                                     |   |

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| • | Attract the most sophisticated traders by providing      access to algorithmic trading, "black box" and non-click trading strategies; |
|--------|---------------------------------------------------------------------------------------------------------------------------------------|
| • | Attract international active trading clients      to the U.S. markets;                                                                |

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**Table of Contents**

| • | Attract displaced institutional trading professionals      who may turn to independent trading or trade group participation; and |
|--------|----------------------------------------------------------------------------------------------------------------------------------|
| • | Capture new prime brokerage clients by attracting      underserved small to mid-sized hedge funds.                               |

| • | Enhance the Tradient platforms and API;                                      |
|--------|------------------------------------------------------------------------------|
| • | Broaden the set of platforms from which to      choose;                      |
| • | Refine complex options strategy offerings across      all trading platforms; |
| • | Grow international trading activity; and                                     |
| • | Enhance prime brokerage capital introduction      program.                   |

| • | Enhance the lead pipeline through increased      web-based marketing and advertising programs targeted at highly active traders; |
|--------|----------------------------------------------------------------------------------------------------------------------------------|
| • | Increase the sales team personnel; and                                                                                           |
| • | Enable the sales team with increased tools      and support.                                                                     |

| • | Optimize order-flow costs;                                                                             |
|--------|--------------------------------------------------------------------------------------------------------|
| • | Continue to align costs of routing with third-party      platforms; and                                |
| • | Continue to reduce cost structure by optimizing      a variety of management and IT systems processes. |

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|   |                                      |   | Three Months Ended March 31, |            |
|--------|-------------------------------------------|--------|------------------------------|-----------------|
|   |                                           |   |                         | **2009**        |   |   | **% Net         Revenues** |   |   | 2008 |   |   | % Net        Revenues |   |
|   |                                      |   |                         | **(Unaudited)** |   |   |   |   |   |   |   | (Unaudited) |   |   |   |   |   |   |
|   | Commissions and fees                      |   | **$**                        | **6,720,234**   |   |   |   | **90.8%** |   |   | $ | 8,237,980 |   |   |   | 82.8% |   |   |
|   |                                      |   |                         | ****            |   |   |   | **** |   |   |   |  |   |   |   |  |   |   |
|   | Interest income                           |   |                         | **420,276**     |   |   |   | **5.7%** |   |   |   | 2,070,884 |   |   |   | 20.8% |   |   |
|   | Interest expense on brokerage accounts    |   |                         | **284**         |   |   |   | **0.0%** |   |   |   | 608,743 |   |   |   | 6.1% |   |   |
|   | Net interest income                       |   |                         | **419,992**     |   |   |   | **5.7%** |   |   |   | 1,462,141 |   |   |   | 14.7% |   |   |
|   |                                      |   |                         | ****            |   |   |   | **** |   |   |   |  |   |   |   |  |   |   |
|   | Software fees, net                        |   |                         | **257,518**     |   |   |   | **3.5%** |   |   |   | 159,003 |   |   |   | 1.6% |   |   |
|   | Other revenue                             |   |                         | **461**         |   |   |   | **0.0%** |   |   |   | 84,781 |   |   |   | 0.9% |   |   |
|   | **Net revenues**                          |   |                         | **7,398,205**   |   |   |   | **100.0%** |   |   |   | 9,943,905 |   |   |   | 100.0% |   |   |
|   |                                      |   |                         | ****            |   |   |   | **** |   |   |   |  |   |   |   |  |   |   |
|   | Commissions and clearing                  |   |                         | **2,534,779**   |   |   |   | **34.3%** |   |   |   | 2,608,227 |   |   |   | 26.2% |   |   |
|   | Compensation and benefits                 |   |                         | **2,365,888**   |   |   |   | **32.0%** |   |   |   | 3,022,051 |   |   |   | 30.4% |   |   |
|   | Software and market data                  |   |                         | **903,770**     |   |   |   | **12.2%** |   |   |   | 1,654,011 |   |   |   | 16.6% |   |   |
|   | Advertising and promotional               |   |                         | **137,230**     |   |   |   | **1.9%** |   |   |   | 181,989 |   |   |   | 1.8% |   |   |
|   | Professional fees                         |   |                         | **686,921**     |   |   |   | **9.3%** |   |   |   | 796,851 |   |   |   | 8.0% |   |   |
|   | Communications and information technology |   |                         | **239,190**     |   |   |   | **3.2%** |   |   |   | 256,571 |   |   |   | 2.6% |   |   |
|   | Depreciation and amortization             |   |                         | **563,267**     |   |   |   | **7.6%** |   |   |   | 557,563 |   |   |   | 5.6% |   |   |
|   | Other general and administrative expenses |   |                         | **506,969**     |   |   |   | **6.9%** |   |   |   | 466,515 |   |   |   | 4.7% |   |   |
|   | **Total expenses**                        |   |                         | **7,938,014**   |   |   |   | **107.3%** |   |   |   | 9,543,778 |   |   |   | 96.0% |   |   |
|   |                                      |   |                         | ****            |   |   |   | **** |   |   |   |  |   |   |   |  |   |   |
|   | Income (loss) before income      taxes    |   |                         | **(539,809**    | **)** |   |   | **-7.3%** |   |   |   | 400,127 |   |   |   | 4.0% |   |   |
|   |                                      |   |                         | ****            |   |   |   | **** |   |   |   |  |   |   |   |  |   |   |
|   | Income tax benefit (provision)            |   |                         | **210,000**     |   |   |   | **2.8%** |   |   |   | (228,000 | ) |   |   | -2.3% |   |   |
|   |                                      |   |                         | ****            |   |   |   | **** |   |   |   |  |   |   |   |  |   |   |
|   | **Net income (loss)**                     |   | **$**                        | **(329,809**    | **)** |   |   | **-4.5%** |   |   | $ | 172,127 |   |   |   | 1.7% |   |   |
|   |                                      |   |                         |            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| • | Net loss for the quarter ended March 31, 2009      of $329,809 includes the following non-cash expenses among other non-cash      items: |
|--------|------------------------------------------------------------------------------------------------------------------------------------------|

|   | ° | Depreciation expense on property and equipment      of $90,442 |
|--------|--------|----------------------------------------------------------------|
|   | ° | Amortization expense on capitalized software      of $130,287  |
|   | ° | Amortization expense on intangible assets of      $342,538     |
|   | ° | Share-based compensation of $30,165                            |

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| • | Decrease of 34% in number of tickets executed      on third-party software trading platforms during the first quarter of 2009      compared to the same period in 2008. We also experienced a decrease in the      number of tickets executed on the Tradient platform by 6% during the three      months ended March 31, 2009 compared to the same period in 2008.                                                                                                                                                               |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Higher net software fees of $100,000 from Tradient      platform subscriptions for the three months ended March 31, 2009 versus      the same period last year. The number of Tradient platform users increased      from 2,327 as of March 31, 2008 to 2,535 as of March 31, 2009.                                                                                                                                                                                                                                               |
| • | Posted average revenue per employee of approximately      $83,000 based on eighty-nine full-time employees for the three months ended      March 31, 2009 compared to $113,000 based on eighty-eight full-time employees      for the same period in 2008. Revenue per employee was down for the three      months ended March 31,2009 compared to three months ended March 31, 2008      as a result of lower overall revenue resulting from reduced average commission      rates and volume and declining net interest income. |

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| Exhibit No.       | Description                                                                                                                                                                                                                       |
|-------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Exhibit      31.1 | Certification      of Chief Executive Officer Pursuant to Rule 13a-14(a) or Rule 15d-14(a)                                                                                                                                        |
| Exhibit      31.2 | Certification      of Chief Financial Officer Pursuant to Rule 13a-14(a) or Rule 15d-14(a)                                                                                                                                        |
| Exhibit      32.1 | Certification      of Chief Executive Officer and Chief Financial Officer Pursuant to Rule      13a-14(b) or Rule 15d-14(b) and 18 U.S.C. Section 1350, as Adopted Pursuant      to Section 906 of the Sarbanes-Oxley Act of 2002 |
|              |                                                                                                                                                                                                                              |

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|   |               | Terra Nova Financial Group, Inc.       (Registrant)                                                                       |
|--------|--------------------|---------------------------------------------------------------------------------------------------------------------------|
|   |               |                                                                                                                      |
|   | Date: May 13, 2009 | /s/ Michael G. Nolan                                                                                                      |
|   |               | Michael G. Nolan                                                                                                          |
|   |               | President and Chief Executive Officer      (Principal Executive Officer)                                                  |
|   |               |                                                                                                                      |
|   | Date: May 13, 2009 | /s/ Murrey Wanstrath                                                                                                      |
|   |               | Murrey Wanstrath       Chief Financial Officer       (Principal Financial Officer and       Principal Accounting Officer) |
|   |               |                                                                                                                      |
|   |               |                                                                                                                      |
|   |               |                                                                                                                      |

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