<PAGE>

                          SECURITIES AND EXCHANGE COMMISSION
                                WASHINGTON, D.C. 20549

                                     FORM 10-QSB

               [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                      SECURITIES EXCHANGE ACT OF 1934

                  For the period ended November 30, 1999

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

For the transition period from _______________to ________________

Commission file number     0-21753

SERVICE SYSTEMS INTERNATIONAL, LTD.
Name of  Small Business Issuer in Its Charter

NEVADA                                           88-0263701
State of Incorporation                       I.R.S. Employer
                                            Identification No.

2800 INGLETON AVE.,
BURNABY, B.C., CANADA                               V5C 6G7
Address of Principal Executive Offices              Zip code

604-541-1069
Issuer's Telephone Number

Securities registered under Section 12(b) of the Act:

NONE

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

COMMON STOCK, PAR VALUE $0.001 PER SHARE
Title of class

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

Check whether the registrant filed all documents and reports required to be
filed by section 12, 13, or 15(d) of the .Exchange Act after the distribution of
securities under a plan confirmed by court.    Yes    No

APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date:  14,981,090 as of January
12, 2000

<PAGE>

                                      INDEX

<TABLE>

<S>                                                                               <C>
PART I   Financial Information

Item 1.  CONSOLIDATED FINANCIAL STATEMENTS................................................3

Consolidated Balance Sheets as of November 30, 1999
         and 1998 (unaudited) ............................................................4

Consolidated Statements of Operations for the three months ended
         November 30, 1999 and 1998 (unaudited)...........................................5

Consolidated Statements of Cash Flows for the three months ended
         November 30, 1999 and 1998 (unaudited)...........................................6

Notes to the Financial Statements...................................................7 to 11

Item 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS
            AND FINANCIAL CONDITIONS...............................................12 to 16

PART II           OTHER INFORMATION......................................................17

Item     1.       LEGAL PROCEEDINGS......................................................17

Item     2.       CHANGES IN SECURITIES..................................................17

Item     3.       DEFAULT UPON SENIOR SECURITIES.........................................17

Item     4.       SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS....................17

Item     5.       OTHER INFORMATION......................................................17

Item     6.       EXHIBITS AND REPORTS ON FORM 8-K.......................................17

Signatures...............................................................................18

</TABLE>

                                                                              2

<PAGE>

PART 1           FINANCIAL INFORMATION

Item 1   Financial Statements  (unaudited)


























                                                                             3


<PAGE>

Service Systems International, Ltd.
Consolidated Balance Sheet
As of November 30, 1999 and 1998
(Unaudited)

<TABLE>
<CAPTION>

                                                                                  November 30,        November 30,
                                                                                      1999                1998
<S>                                                                              <C>                 <C>
           Assets
Current Assets
       Cash and short-term investments                                               $28,646            $ 6,146
       Short-term investments - restricted (Note 3)                                  265,160            258,393
       Accounts receivable                                                            93,719            227,429
       Inventory and contract work in progress                                       309,938            267,798
       Prepaid expenses and deposits                                                  28,055             23,715
                                                                                ------------        -----------

Total Current Assets                                                                 725,518            783,481

Property, Plant and Equipment (Note 4)                                                84,418            107,780
Other Assets
       Goodwill (net of amortization of $1,455,243)                                  970,165          1,455,246
       Patents and trademarks (Note 5)                                               224,620             93,436
                                                                                ------------        -----------

Total Assets                                                                      $2,004,721         $2,439,943
                                                                                ============        ===========

           Liabilities and Stockholders' Equity
Current Liabilities
       Bank demand loan (Note 6)                                                     $22,640                 $0
       Accounts payable                                                              242,277            115,780
       Accrued liabilities                                                            34,564             42,503
       Vacation pay payable                                                           19,008              7,806
       Customer deposits                                                              17,356                  0
       Loan payable (Note 6)                                                         352,269                  0
       Amounts owing to related parties (Note 7)                                     260,031            115,357
                                                                                ------------        -----------

Total Current Liabilities                                                            948,144            281,446

Long-term debt (Note 8)                                                            2,550,008          2,347,998
                                                                                ------------        -----------

Total Liabilities                                                                  3,498,152          2,629,444
                                                                                ------------          ---------


Stockholders' Equity (Deficit)

Common stock, $.001 par value,
       50,000,000 shares authorized, 14,738,369
       and 12,662,988 issued and outstanding respectively                             14,738             12,663
       Additional paid-in capital                                                  3,488,646          3,073,619

Deficit                                                                           (4,996,815)        (3,275,783)
                                                                                -------------       ------------

Total Stockholders' Equity (Deficit)                                              (1,493,431)          (189,501)
                                                                                -------------       ------------

Total Liabilities and Stockholders' Equity                                        $2,004,721         $2,439,943
                                                                                ============        ===========

</TABLE>


                 See accompanying notes to financial statements

                                                                               4

<PAGE>

Service Systems International, Ltd.
Consolidated Statements of Operations and Deficit
For the three months ended November 30, 1999 and 1998
(Unaudited)

<TABLE>
<CAPTION>

                                                                               Three Months         Three Months
                                                                                   ended                ended
                                                                               Nov. 30, 1999        Nov. 30, 1998

<S>                                                                           <C>                <C>
Project Revenue                                                                           $0           $106,811
Project Costs                                                                              0             82,430
                                                                                ------------        -----------

Gross Profit                                                                               0             24,381
Manufacturing Costs Not Applied                                                       35,340             22,634
                                                                                ------------        -----------

                                                                                     (35,340)             1,747
                                                                                ------------        -----------
 Expenses
       Selling                                                                        79,425             65,387
       General and administrative                                                    127,339             77,339
       Research and development                                                       36,075             28,003
       Amortization of goodwill                                                      121,270            121,270
       Interest, net of interest income                                               26,309             20,682
       Foreign exchange loss                                                          32,695             39,650
                                                                                ------------        -----------

                                                                                     423,113            352,331
                                                                                ------------        -----------

Net Loss for the period                                                              458,453            350,584

Deficit - Beginning of period                                                      4,538,362          2,925,199
                                                                                ------------        -----------

Deficit - End of period                                                           $4,996,815        $3,275,783
                                                                                ============        ==========


Net Loss per share                                                              $      (0.03)       $    (0.03)
                                                                                ============        ==========

Weighted average shares outstanding                                               14,672,669        12,662,988
                                                                                ============        ==========

</TABLE>

                        See accompanying notes to financial statements

                                                                               5

<PAGE>


Service Systems International, Ltd.
Consolidated Statements of Cash Flows
(Unaudited)

<TABLE>
<CAPTION>

                                                                                Three Months       Three Months
                                                                                    ended              ended
                                                                                Nov. 30, 1999      Nov. 30, 1998
<S>                                                                            <C>                <C>
Cash Flows to Operating Activities
       Net loss                                                                  $(458,452)          $(350,584)

Adjustments to reconcile net loss to cash
       Amortization of goodwill                                                    121,270             121,270
       Depreciation                                                                 11,445              10,684
       Foreign exchange loss                                                        32,695              39,650
       Common stock issued for expenses                                              6,972                   0
       Accrued interest on long-term debt                                           28,555                   0

Change in non-cash working capital items
       Decrease (Increase) in accounts receivable                                  216,406            (116,472)
       (Increase) in inventory and contract work in progress                       (35,346)            (29,517)
       Decrease in prepaid expenses and deposits                                     9,111              12,460
       (Decrease) Increase in accounts payable, accrued
           liabilities, vacation pay payable
           and customers' deposits                                                  (2,361)             40,960
                                                                             --------------      -------------

Net Cash Used in Operating Activities                                              (69,705)           (271,549)
                                                                             --------------      -------------

Cash Flows (to) from Investing Activities
       Acquisition of short-term investment - restricted                            (2,258)             (9,076)
       Additions to patents and trademarks                                         (41,232)               (952)
       (Acquisition) Disposal of Capital assets                                     (4,350)             22,933
                                                                             --------------       ------------

Net Cash (Used in) Provided by Investing Activities                                (47,840)             12,905
                                                                             --------------      -------------

Cash Flows from (to) Financing Activities
       (Decrease) in bank demand loan                                             (186,741)                  0
       Common stock issued                                                         350,880                   0
       (Decrease)  in loans payable                                                (78,265)                  0
       Increase in amounts owing to related parties                                 52,332              19,915
       Increase in borrowings from minority shareholders                                 0              37,823
                                                                             -------------       -------------

Net Cash Provided by Financing Activities                                          138,206              57,738
                                                                             -------------       -------------

Increase (Decrease) in Cash and Cash Equivalents                                    20,661            (200,906)

Cash and Cash Equivalents - Beginning of Period                                      7,985             207,052
                                                                             -------------       -------------

Cash and Cash Equivalents - End of Period                                          $28,646              $6,146
                                                                             =============       =============

</TABLE>

                        See accompanying notes to financial statements

                                                                               6

<PAGE>


Service Systems International, Ltd.

Notes to the Consolidated Financial Statements

1.   Nature of Operations and Continuance of Business
     The Company was incorporated in the State of Nevada in August, 1990 and
     remained inactive until September 1, 1995. The initiation of the Company's
     current business was accompanied by a change of ownership. See Note 4
     regarding acquisition of UV Systems Technology Inc. ("UVS") on December 1,
     1996, a Canadian company. Through UVS, the Company manufactures and markets
     its Ultra Guard-Registered Trademark- ultra violet based patented water
     treatment system.  These products and systems are sold primarily for
     municipal waste disinfection, treatment of process and industrial waste
     water, and for potable water, bottled products and agriculture and
     aquaculture water treatment.

     During fiscal 1998 the Company emerged from a development stage company
     to an operating company for accounting purposes. Even though its status
     has changed to an operating company, the operating activities have not
     yet produced significant revenue and the Company has experienced
     significant losses to date. The ability of the Company to continue
     operations is dependent upon its successful efforts to raise additional
     equity financing in the long term, continue developing the market for
     its products, and/or the attainment of profitable operations.

2.   Significant Accounting Policies

     CONSOLIDATED FINANCIAL STATEMENTS

     These financial statements include the accounts of the Company, and its
     50.7% owned Canadian subsidiary, UVS.

     CASH AND CASH EQUIVALENTS

     Cash and cash equivalents include cash on hand, in banks and all highly
     liquid investments with a maturity of three months or less when purchased.
     Cash equivalents are stated at cost which approximates market.

     PROPERTY, PLANT, AND EQUIPMENT

     Property, Plant, and Equipment are recorded at cost. Depreciation is
     computed on a straight-line method using an estimated useful life of five
     years.

     GOODWILL

     Goodwill represents the excess of purchase consideration over fair market
     value of net identifiable assets acquired, and is amortized on a
     straight-line basis over five years. Goodwill is evaluated in each
     reporting period to determine if there were events or circumstances which
     would indicate inability to recover the carrying amount. This evaluation is
     based on various

                                                                               7

<PAGE>

     analyses including discounted cash flows and profitability projections
     which necessarily involve management judgement.

     PATENTS AND TRADEMARKS

     Patents and trademarks will be amortized to operations over their estimated
     useful lives of twenty years.

     REVENUE RECOGNITION

     Product sales will be recognized at the time goods are shipped. System and
     project revenue will be recognized utilizing the percentage of completion
     method which recognizes project revenue and profit during construction
     based on expected total profit and estimated progress towards completion
     during the reporting period. All related costs are recognized in the period
     in which they occur.

     ESTIMATES

     The preparation of the Company's consolidated financial statements requires
     management to make estimates and assumptions that affect the amounts
     reported in the financial statements and accompanying notes. Actual results
     could differ from these estimates.

     EARNINGS PER SHARE

     The earnings per share is computed by dividing the net income (loss) for
     the period by the weighted average number of common shares outstanding for
     the period. Common stock equivalents are excluded from the computation if
     their effect would be anti-dilutive.

     FOREIGN CURRENCY

     i)  Translation of foreign currency transactions and balances:

         Revenue, expenses and non-monetary balance sheet items in foreign
         currencies are translated into US dollars at the rate of exchange
         prevailing on the transaction dates. Monetary balance sheet items are
         translated at the rate prevailing at the balance sheet date. The
         resulting exchange gain or loss is included in general and
         administration expenses.

     ii) Translation of foreign subsidiary balances:

         Monetary balance sheet items of UVS are translated into US dollars at
         the rates of exchange on the balance sheet date. Non-monetary balance
         sheet items are translated into US. dollars at the rate of exchange
         prevailing on the transaction dates. The foreign subsidiary's operating

                                                                               8

<PAGE>

         results are translated into US dollars using the average exchange rate
         for the year with any translation gain or loss is included separately
         in operations.

3.   Restricted Cash

     In connection with a letter of credit, required under a long-term project
     to be completed in fiscal 2000, the Company purchased a C$393,000 face
     value Bankers' Acceptance to be held as a bond for the letter of credit of
     C$390,809.

4.     Property, Plant, and Equipment

      Property, Plant, and Equipment are stated at cost less accumulated
      depreciation.

<TABLE>
<CAPTION>

                                                                                               1999          1998
                                                                            Accumulated      Net Book      Net Book
                                                                Cost       Depreciation        Value         Value
                                                                  $              $               $             $
       <S>                                                   <C>          <C>               <C>           <C>
        Computer equipment                                      43,094         23,673          19,421         19,683
        Computer software                                        5,689          3,123           2,566          2,979
        Display equipment                                       33,016         23,995           9,021         14,326
        Office furniture and equipment                          30,468         21,038           9,430         14,143
        Plant jigs, dies, moulds, tools and equipment           99,648         60,122          39,526         46,852
        Leasehold improvements                                  26,724         22,270           4,454          9,797
                                                              --------       --------        --------      ---------
                                                               238,639        154,221          84,418        107,780
                                                              ========       ========        ========      =========

</TABLE>

        Depreciation per class of asset:

<TABLE>
<CAPTION>

                                                                                      $                    $
       <S>                                                                         <C>                 <C>
        Computer equipment                                                           2,067               1,762
        Computer software                                                              251                 255
        Display equipment                                                            1,592               1,592
        Office furniture and equipment                                               1,520               1,459
        Plant jigs, dies, moulds, tools and equipment                                4,679               4,278
        Leasehold improvements                                                       1,336               1,338
                                                                             -------------         -----------

                                                                                    11,445              10,684
                                                                             =============         ===========

</TABLE>

5.      Patents and Trademarks

        Patents and trademarks represent legal costs associated with designing,
        registering and protecting

                                                                               9

<PAGE>

        certain patents and trademarks associated with the Ultra Guard
        -Registered Trademark- System. These costs are amortized over twenty
        years. Components of the Ultra Guard-Registered Trademark- System were
        patented in the United States on April 12, 1996. Applications have been
        approved for patent protection under the International Patent Protection
        Treaty covering 13 European countries. Translations and other
        requirements to formalize these patents will continue through Year 2000.

6.         Demand Loans

        a) The bank demand loan of $22,640 is from Toronto Dominion Bank of
        Canada and bears interest at Toronto Dominion Bank prime plus 2%.

        b) At August 31, 1999, the company had loans payable to "the Elco
        Bank Group", located in Nassau, Bahamas, of $341,940. During the
        first quarter period, the company repaid $289,256 of this loan with
        proceeds from the exercise of Class "E" warrants for the issuance of
        1,446,281 shares of $0.20 per share and through the issuance of
        1,446,281 Class "E" warrants, exercisable at $0.40 each and expiring
        on September 13, 2002. During the period, the company received
        additional loan proceeds of $258,753, resulting in a loans payable
        balance of $311,436 owing to "the Elco Bank Group". The loans payable
        is unsecured, non-interst bearing, and due on demand.

        c) Loans payable of $14,268 are unsecured, non-interest bearing and were
        repaid subsequent to November 30, 1999 by issuance of 34,470 shares at
        prices between $0.35 and $0.48 and the issuance of 34,470 Class "A"
        warrants exercisable at prices between $0.35 and $.70 expiring between
        April 8, 2002 and September 27, 2002.

        d) A minority shareholder of UVS loaned it $23,450 (C$35,000) bearing
        interest at 10% per annum, unsecured and due on demand.

7.      Amounts Owing to Related Parties

<TABLE>
<CAPTION>

                                                                                      1999               1998
                                                                                        $                  $
<S>                                                                          <C>                 <C>
             (a)Amounts owing to a company owned by a director
             are due on demand, unsecured and bear interest at
             12% per annum compounded monthly.  The creditor
             has the option to demand repayment in shares
             and warrants at the bid price on settlement day for the
             shares and 10% above the bid price for the warrants;                    53,801                   -

        (b)  Amounts owing to two directors, due on demand,
             unsecured and non-interest bearing                                     206,230             115,357
                                                                             --------------        ------------

                                                                                    206,031             115,357
                                                                             ==============        ============

</TABLE>

8.      Long-term Debt

        Prior to fiscal 1998, UV Systems Technology Inc. (UVS) issued 2,000
        Class "A" preferred shares at C$1,000 per share for proceeds of
        C$2,000,000 (US$1,356,392). The holders of these shares

                                                                             10

<PAGE>

        also own 49.3% of the common shares of UVS ("minority shareholders").
        Class "A" Preferred Shares are retractable once sales reach
        C$10,000,000 and net income reaches C$1,000,000, and are to be
        redeemed by June 30, 2000.

        During fiscal 1998, minority shareholders advanced C$631,000 to UVS.
        Interest accrued to June 29, 1998, at 20% per annum, totalled C$280,000.
        Pursuant to an interim refinancing agreement ("the Agreement"), dated
        June 29, 1998, all accrued interest was waived. The principal repayment
        of C$631,000 has been deferred to June 29, 2003, and interest at 10%
        accrues until December 29, 2000, after which is paid monthly. The
        Company waived interest of C$217,000 accrued on its loan to UVS of
        C$1,287,000.

        Under the Agreement one of the minority shareholders advanced C$909,000
        to UVS. This advance is secured by a subordinated debenture on all of
        UVS' assets, bears interest at 10%, payable monthly, is due in 2003, and
        ranks ahead of the minority shareholder loans and Class "A" Preferred
        Shares.

        The Company's subsidiary, UVS, completed its debt and share
        restructuring subject to completion of documentation and regulatory
        approval. Class "X" Preferred Shares will be a new class of shares added
        to the authorized capital stock of UVS. 500 Class "A" Preferred Shares,
        representing 50% of the Class "A" preferred shares held by one of UVS'
        minority shareholders will be replaced with 500,000 Class "X" Preferred
        Shares retractable at C$1.00 per share. The Company's loan to UVS of
        C$1,287,000 will be transferred into 1,287,379 Class "X" Preferred
        Shares retractable at C$1.00 per share. These Class "X" Preferred Shares
        will be retractable by the holders only if there is a sale of UVS or an
        initial public offering of its securities which values UVS, excluding
        Class X Preferred Shares, at C$20 million. If not retracted by June 29,
        2002, the Class X Preferred Shares will be redeemable by UVS for C$1 in
        total.

                                                                             11

<PAGE>


Item  2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS AND FINANCIAL CONDITION

Our company was incorporated in the State of Nevada in August 1990, and
remained inactive until September 1995. The initiation of the current
business was accompanied by a change of ownership (see "Company Background").
Through UVS, Service Systems manufactures and markets its Ultra
Guard-Registered Trademark- ultra violet-based patented water treatment
system. These products are sold primarily for municipal wastewater
disinfection; however, the system can also be adapted for treatment of
process and industrial wastewater ( where it is currently being applied
through UVS's Japanese agent) and for potable water, bottled products and
agriculture and aquaculture water treatment.

In September 1995 Service Systems initiated a marketing distribution
agreement with UV Systems Technology Inc., a manufacturer of equipment using
proprietary ultraviolet light technology for the microbiological disinfection
of industrial and municipal wastewater. In July 1996 Service Systems entered
into a funding agreement with UV Systems Technology Inc., (UVS) whereby
Service Systems provided 50% of UVS's operating cash needs for a six-month
period. On December 1, 1996, Service Systems acquired 50.69% of the common
stock of UVS from two principals and the minority stockholders. On December
6, 1996, Service Systems entered into an agreement with the remaining two
minority stockholders, Working Opportunity Fund (EVCC) Ltd. (WOF) and MDS
Ventures Pacific Inc.(MDS), to acquire the remaining 49.31% common stock and
their preferred stock (Purchase Agreement). Any funds advanced under this
Purchase Agreement would be forfeit should Service Systems be unsuccessful in
raising C$2.0 million. In June 1998 this Purchase Agreement was not renewed
as Service Systems was unable to raise the C$2.0 million required to complete
the transaction, and WOF agreed to loan UVS additional funds (see details
following) and agreed to allow conversion of the funds advanced under the
Purchase Agreement.

In June 1998, UVS entered an interim agreement with WOF (Agreement) to
provide $579,535 of additional funding and reduced debt by requiring MDS and
Service Systems to convert their loans receivable into Class "X" Preferred
shares, retractable by the holder only if there is a sale or IPO which values
the equity of UVS, including the Class "A" preferred shares, but excluding
the Class "X" Preferred shares, at C$20.0 million. If not retracted within 4
years from the closing date of this Agreement, the Class "X" Preferred shares
will be redeemable by UVS for C$1.00.

During the period from December 1, 1996 to September 30, 1997, Service
Systems continued with UVS's system development and testing programs. These
programs included the development of both a mechanical and electronic
automatic quartz sheath cleaning system, to remove the fouling build-up due
to suspended solids and chemical prevalent in wastewater. The program of
development on the mechanical cleaner determined that the method chosen was
viable and performs the function desired.

Field testing of the mechanical wiper cleaning system was concluded during
October and November, 1997, at a PDU test site at Ville de Repentigney near
Montreal, Quebec. The test results concluded that the cleaning system did
perform above anticipated levels, and the system has now been incorporated
into current products sold. The temperature control system for the UVS System
was also tested at the Ville de Repentigney test site during temperatures
ranging down to minus 8 degrees Celsius and up to plus 8 degrees Celsius. The
test showed that with temperature control, infinite variable lamp UV output
intensity was stable and controllable. This feature is now included on all
product sales. The benefits of the temperature control are, instant response
to changes in power settings, consistent UV output, infinite controllability
through a full range of UV settings, and expected longer lamp-in-service
life. To our knowledge, no other UV equipment supplier can offer this degree
of control of a UV lamp. Development of the electronic ultrasonic cleaning
system has been discussed with a designer of such devices in anticipation of
further research in this regard.

Negotiations continue on finalizing a project delivered to New Zealand in
1995 by UVS and release of hold back funds. Testing of the system is ongoing
to determine if the equipment is in compliance at times of correct effluent
flow conditions. During the 1999 fiscal year, the client ordered changes to
his UV system amounting to C$31,200, all of which was prepaid. Fifty percent
of the work had been completed by August 31, 1999. The balance of the work is
continuing.

A 6-lamp Ultra Guard-Registered Trademark- UV system capable of disinfecting
a wastewater flow of 3.5 million gallons per day was sold to Hamilton,
Alabama and was installed in March, 1999. Successful final performance
testing was conducted in July 1999.

                                                                           12

<PAGE>

This UV project is the first full scale operating Ultra Guard-Registered
Trademark- UV system installed in North America. We expect that the Ultra
Guard-Registered Trademark- UV system in Hamilton will provide significant
equipment exposure to others contemplating upgrading their Wastewater
Treatment Plant discharges by replacing chlorine as the disinfecting means
with environmentally friendly ultraviolet disinfection.

In June 1998, UVS received a letter of intent for a UV system valued at
C$605,000 for a project in Toronto, Canada. In September 1999, the formal
order was secured for about C$ 685,000. The project is scheduled for delivery
in June 2000. This project is currently in the design and approval phase.
Manufacturing will commence in February 2000. The UV system to be delivered
to Toronto is part of a C$50 million combined storm overflows (CSO) project
(the world's largest submersible CSO pumping station) and will be used for
disinfection of CSO.

After successful PDU testing in September & October, 1998 at the City of
Peterborough wastewater treatment plant, and subsequent response to the
request for proposal in August 1999, in September the Company received an
order valued at over C$1,100,000. Design approval is currently ongoing and
manufacturing will commence in late January 2000 with delivery scheduled for
August 2000. The UV system will disinfect effluent flow in excess of 36
million gallons per day. The Wastewater Plant is scheduled to be operational
by the end of December 2000.

Purchase orders for two additional UV systems valued at approximately
C$150,000 were received in the 1999 fiscal year. The systems will be produced
during the 2000 fiscal year and will be delivered into the Province of
Ontario. Drawing review is currently ongoing as well as manufacturing. One
project will be delivered in February 2000, the other in June 2000.

In January 1999, a PDU was installed at the County Sanitation Districts of
Los Angeles County (the County). The testing program was presented at the
Energy Efficiency Forum held in San Diego on August 30-31, 1999. Testing was
completed in July 1999 and was conducted and paid for by the County. The
purpose of the test was to determine the Ultra Guard-Registered Trademark- UV
system's ability to disinfect wastewater to Title 22 Guidelines, a stringent
test protocol required as a precursor to the use of a company's UV product in
reuse of wastewater for agriculture and other purposes. The County reported
that the findings of the five-month testing program confirmed the ability of
the Ultra Guard-Registered Trademark- UV system to achieve Title 22 design
objectives at fifty percent of the dose required by low pressure, low
intensity technology previously tested. A substantial saving in energy usage,
12.7%, was achieved by using the Ultra Guard-Registered Trademark- system.
The same safeties are applied to both types of lamps. Based on discussions
with the Approval Authority, Title 22 acceptance is expected in February 2000.

In October 1999, the Company signed an agreement with a leading Australian UV
equipment manufacturer to market its product in North America. The products
provided through this agreement would permit the Company to sell into market
areas not currently serviced. These products will service small to
intermediate scale projects for municipal and industrial clients in the area
of potable water, food processing and recreational services. In addition, the
product is used by clients requiring treatment solutions beyond disinfection
such as oxidation of chemical and organic by-products occurring in nature as
well as those occurring as a result of production processes.

RESULTS OF OPERATIONS

Three Months Ended November 30, 1999 compared to the three months ended
November 30, 1998.

         REVENUES. During the first quarter of fiscal 2000, we reported no
revenues, a decrease of $106,811 or 100%, from the $106,811 reported in the
first quarter of fiscal 1999. This decrease resulted from delayed completion
of projects in process, which did not provide for payment during that period.
Revenues from the additional projects awarded will be realized in the
remaining 3 quarters of fiscal 2000.

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<PAGE>

         DIRECT PROJECT COSTS. For the first quarter of fiscal 2000, we reported
no direct project costs, a decrease of $82,430 or 100%, from the $82,430
reported in the first quarter of fiscal 1999. This decrease resulted from
non-completion of contract work by sub-contractors. We expect the
sub-contractor to complete its work in our third quarter.

         GROSS PROFIT. For the first quarter of fiscal 2000, we reported no
gross profit, a decrease of $24,371, or 100%, from the $24,381 reported in the
first quarter of fiscal 1999. This decrease resulted from delayed completion of
projects.

         MANUFACTURING COSTS NOT APPLIED. Manufacturing costs not applied are
annual plant overhead costs not being charged against specific contracts. For
the first quarter of fiscal 2000, we reported manufacturing costs not applied
of $35,340, an increase of $12,706, or 56 %, from $22,634 reported in the
comparable period of the prior year. This increase resulted from the decrease
in sales and resultant decrease in manufacturing activities.

         SELLING EXPENSES. For the first quarter of fiscal 2000, we reported
selling expenses of $79,425, an increase of $14,038, or 21%, from the $65,387
reported in the comparable period of the prior year. This increase primarily
resulted from increase in sales engineering costs of $7,000, increase in
exhibition expenses of $4,000 and increase of $4,000 for temporary office
staff.

         GENERAL AND ADMINISTRATIVE EXPENSE. For the first quarter of fiscal
2000, we reported general and administrative expense of $127,339, an increase
of $50,000, or 65%, from the $77,339 reported in the comparable period of the
prior year. This increase resulted primarily from increases in expenses
relating to investor relations, legal fees, and consulting fees due to
securing of new projects. Part of the increase is also due to accounting
office help for the audit work.

          RESEARCH AND DEVELOPMENT. For the first quarter of fiscal 2000, we
reported general and administrative expense of $36,075, an increase of
$8,072, or 29%, from the $28,003 reported in the comparable period of the
prior year. This increase was due to expenses incurred to redesign components
of the UV system.

         AMORTIZATION OF GOODWILL. For the first quarter of fiscal 2000, we
reported amortization of goodwill of $121,270, the same figure for the
comparable period of the prior year. The goodwill resulted from our
acquisition of a majority interest in our subsidiary, UVS. The goodwill will
be completely amortized in 2002.

          INTEREST, NET OF INTEREST INCOME. For the first quarter of fiscal
2000, we reported interest, net of interest income, of $26,309, an increase
of $5,627, or 27%, over the $20,682 reported in the comparable period of the
prior year. The increase in interest, net of interest income, resulted from a
decrease of $1,500 in interest income and an increase in interest expense
amounting to $1,600 due to the accumulated interest in long-term debt.

         FOREIGN EXCHANGE TRANSLATION LOSS. For the first quarter of fiscal
2000, we reported foreign exchange translation loss of $32,695, a decrease of
$6,955, or 18%, from the $39,650 reported in the comparable period of the
prior year. This decrease resulted from the decrease in the value of the
Canadian dollar as compared to the first quarter of the prior year.

         NET LOSS FOR THE PERIOD. For the first quarter of fiscal 2000, we
reported a net loss for the period of $423,113, an increase of $107,869, or
31% over the $350,584 reported in the comparable period of the prior year.
The increase in net loss was due to the increased expenses and lack of
revenue described above.

         NET LOSS PER SHARE. For the first quarter of fiscal 2000, we
reported a net loss per share for the period of $.03, the same net loss per
share reported for the comparable period of the prior year. The net loss per
share remained the same because the increased net loss was allocated over an
increased number of outstanding shares and share equivalents.

                                                                            14

<PAGE>

LIQUIDITY

The nature of our business may be expected to include a normal lag time
between the incurring of operating expenses and the collection of contract
receivables, which may be expected to be due largely from governments, if and
when sales are made. In addition, we are dependent on sales to a licensee,
which is obligated to purchase agreed upon system components, and on awards
of water treatment system contracts for non-recurring projects. Many of our
contracts may be expected to include provision for hold back, entitling the
other party to the contract to withhold a specified portion of the payment
for a given period of time until after completion of a project. For these and
other reasons, we may experience periods of limited working capital and may
be expected to require financing for working capital during those periods.
During the current quarter we have received C$28,052 in payments from partial
completion of subcontractor work.

Our sales of Ultra Guard-Registered Trademark-systems to governmental
entities may be expected to occur on an intermittent rather than consistent
basis as requests for proposal ("RFP") are issued and awards made. Sales on
both an annual and quarterly basis are subject to fluctuations which are
often beyond our control.

In addition, we will require financing over and above our current resources
to sustain our operations and expand our marketing efforts. We cannot assure
that the additional financing can be obtained on a timely basis, on terms
which are acceptable or if at all.

We financed our operations during the first quarter of the fiscal 2000, in
part, from sales of restricted common stock, loans from Elco Bank, and loans
from related parties.

We expect that during fiscal 2000, as and if sales at UVS increase, we will
continue to depend on receipt of additional funds through public or private
equity or debt sales or other lender financing to fund the manufacturing of
products sold and general operational and sales expenses. Except as
previously indicated, no arrangements are currently in place to raise funds,
although we actively continue to seek sources. Failure to receive these funds
may be expected to have a material adverse effect on our company.

YEAR 2000 ISSUE

DESCRIPTION OF THE ISSUE. The Y2K issue refers to the inability of certain
date-sensitive computer chips, software, and systems to recognise a two-digit
date field as belonging to the 21st century. Mistaking "00" for 1900 or any
other incorrect year could result in a system failure or miscalculations
causing disruptions to operations, including manufacturing, a temporary
inability to process transactions, or send invoices, or engage in other
normal business activities. This is a significant issue for most, if not all
companies, with far reaching implications, some of which cannot be
anticipated or predicted with any degree of certainty. The Y2K issue may
create unforeseen risks to our from its internal computer systems as well as
from computer systems of third parties with which it deals. Failures of our
computers, and/or third parties computer systems could have a material
adverse impact on our ability to conduct its business.

YEAR 2000 TASK FORCE. We have set up an internal task force comprised of our
Director of Manufacturing and Engineering managers to review our products,
business and engineering applications and suppliers and develop contingency
plans for Y2K readiness. This was completed as of Dec 15, 1999. The goal of
the task force was to minimize the effect that Y2K issues will have on the
Company and its customers. The Director of Manufacturing has advised the CEO
that to the best of the task force's ability, the Company is Y2K ready.

INTERNAL BUSINESS AND ENGINEERING SYSTEMS. The task force has completed a
review of all internal business and engineering computer systems to ensure
that their systems either will be Y2K ready, or have been modified or
replaced by Y2K ready systems. All computer systems have been modified, we
have completed the readiness of the internal business and engineering
systems. We have already been assured that our accounting information system
installed in 1995 is Y2K ready as long as we adhere to the supplier's Y2K
readiness guidelines. As a precaution we purchased an upgrade model of the
accounting information system to be assured that the system is fully

                                                                         15

<PAGE>

compliant. We reviewed, simulated and tested, in a Y2K environment, our
engineering, business information systems, internal telephone equipment,
local networks, and security and sprinkler systems to verify their Y2K
readiness. As of January 12, 2000, we had experienced no significant system
problems related to Y2K.

SUPPLIERS. Our major suppliers are component parts distributors and contract
manufacturers. Often the Company sources its products and manufacturing
services from multiple and/or competing vendors. We have formally canvassed
our suppliers and received written responses to our Y2K questionnaires, which
have determined to the best of our ability to what extent we may be
vulnerable due to their failure to be Y2K ready. We cannot assure that the
systems of other companies on which we rely will be Y2K ready on a timely
basis and will not have an adverse effect on our operations. In instances
where we are unable to determine that our vendors have taken appropriate
steps to minimize disruption due to non-Y2K readiness, we have contingency
plans, including moving to identified alternate sources, or developing new
alternate sources. As of January 12, 2000, we had experienced no significant
disruptions related to Y2K.

PRODUCTS. The task force has assessed the ability of outside sourced,
computer based control systems used within our product to handle the year
2000. Certain of our computer processor board level products and integrated
computer systems utilise computer chips that include built in operating
systems ("BIOS") allowing the computer to initialise and load software. All
current built for delivery computer systems have been assessed for readiness
before purchase. As of January 12, 2000, we had experienced no significant
problems arising from Y2K in our outside sourced, computer based contract
systems.

COSTS. The cost of our Y2K assessment, including both incremental spending
and re-deployed resources, has not been material. The current assessment does
not include potential costs related to any customer or other claims, or the
cost of internal software and hardware replaced in the normal course of
business. This assessment is subject to change. Since there is no uniform
definition of Y2K readiness and since all customer situations cannot be
anticipated, particularly those involving third party products, we may see
claims as a result of the Y2K transition. Such claims, if successful, could
have a material adverse impact on future results. As of January 12, 2000, no
such claims had been presented to us.

CUSTOMERS. Since our customers all purchase built to order systems and our
computer based control systems will be manufactured to be compliant, we
believe that Y2K will not effect our customers' decisions to purchase our
Ultra Guard-Registered Trademark- UV system. However, we can not predict the
impact on us of our customers' lack of Y2K compliance and any disruption
caused to treatment systems we have installed because of their
non-compliance. Costs and damages related to or arising from non-compliance
could materially adversely effect our revenues or our business, even though
we believe our systems themselves to be compliant. As of January 12, 2000, to
our knowledge, none of our customers had experienced treatment system
disruptions arising from Y2K non-compliance.

COST ESTIMATES. We have not been required to incur costs of Y2K remedial work
and have not set aside any contingency fund to deal with any contingencies
which may arise. The cost for Y2K compliance based on our best estimates,
which were derived from numerous assumptions about future events, including
third-party modification plans and other factors. However, we cannot
guarantee that those estimates will be accurate and actual results may differ
materially from those plans. Specific factors that might cause material
differences include, but are not limited to, the availability and the cost of
personnel trained in this area and the ability to identify and correct all
relevant computer codes.

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<PAGE>

PART II           OTHER INFORMATION

Item 1.  Legal Proceedings

On October 20, 1998 a suit was filed in the Supreme Court of British Columbia by
Thomas O'Flynn against the Company, Kenneth Fielding (the Company's President
and Director), and Charles P Nield (a former Director and Vice President of the
Company). O'Flynn alleges that in April of 1996, he purchased shares of the
Common Stock based on a representation that they would be free trading in 40
days of "the filing of a prospectus". He further alleges that in September of
1996 he purchased additional shares of Common Stock based on the representation
that the shares would be free trading within 40 days of the Common Stock
becoming free trading. O'Flynn alleges that the representation was a warranty
and was incorrect. He further alleges that he suffered a loss because the share
price decreased while he was holding the shares. He seeks damages for breach of
warranty, negligence, misrepresentation and breach of fiduciary duty. The amount
claimed is not specified. The Company filed an answer denying the claims and
continues to actively defend the suit. Examination for discovery of Charles P
Nield was conducted in June 1999, since then there has been no further activity.

Item 2.  Changes in Securities

     On September 19, 1999 the Company issued 1,446,281 shares of restricted
common stock to The Elco Bank Group for cash upon the exercise of Class "E"
warrants. These shares were valued at $289,256.20.

     The Company issued to 5 Canadian investors, all previous
investors in the Company, 197,100 shares of restricted common stock in
repayment of debt. In addition to the common stock issued for this debt, the
Company issued a total of 324,000 Class A warrants exercisable at prices
between $0.60 and $0.70 per share between March and August 2002.

     The Company issued 35,100 shares of restricted to employees of the
Company for services valued at a total of $6,474,000.

     All of those shares were issued pursuant to Rule 4(2) of the Securities
Act of 1933. All investors were informed of the risks involved in an
investment in the Company and had all information about the Company that they
needed to make an informed investment in the Company. All investors executed
representation letters, and all issued shares bear restrictive legends.

Item 3.  Defaults upon Senior Securities

              None

Item 4.  Submissions of Matters to a Vote of Security Holders

              None

Item 5.  Other Information

              None

Item 6.  Exhibits and Reports on Form 8-K

              (a) Exhibits (exhibit reference numbers refer to Item 601 of
                  Regulation SB)

              Exhibit Number           Description

              (3)(i)                   Articles of Incorporation(1)

              (3)(ii)                  Bylaws(2)

              (11)                     Statement re: computation of per share
                                       earnings

              (27)                     Financial Data Schedule

________________________

1    Incorporated by reference to the Registrant's Form 10-SB effective 1/17/97.

2    Incorporated by reference to the Registrant's Form S-8 effective 10/6/97


                                                                           17

<PAGE>

                                   Signatures

In accordance with the requirements of the Exchange Act, the Registrant caused
this report to be signed on its behalf by the undersigned, hereunto duly
authorized.

            SERVICE SYSTEMS INTERNATIONAL, LTD.



                  /s/Kenneth R. Fielding                    January 14, 2000
                  Kenneth R. Fielding, President



                  /s/  John  R. Gaetz
                  John R. Gaetz, Chief Financial Officer    January 14, 2000


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