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Will Vegas go for Cryptologic?

Discussion in 'Casino Industry Discussion' started by mary, Apr 28, 2001.

    Apr 28, 2001
  1. mary

    mary Dormant account

    Sting at The Prescription (You must register/login in order to see the link.) has an interesting article aobut Cryptologic in which Crypto appears to think that the legalization of Internet gambling in Nevada may mean good news for Cryptologic.

    While it's true that Cryptologic is very well regarded in the online community and already has some land-based customers in regulated jurisdictions, I don't think any land operation licensed in Nevada will be using them. Period. Cryptologic, unlike Chartwell, has had an active hand in managing their own casinos and has consistently taken wagers from US citizens, and the Nevada Gaming Control Board is not going to like that for political reasons.

    Cryuptologic has a strong balance sheet and may well be an excellent investment. Just don't figure Nevada into those numbers.
     
  2. May 2, 2002
  3. mary

    mary Dormant account

    CryptoLogic Provides Further Detail Regarding Amicable Settlement of New Jersey Civil Action


    TORONTO--(BUSINESS WIRE)--May 1, 2002--CryptoLogic(NASDAQ:CRYP)
    (TSE:CRY.) In response to investors seeking additional information
    regarding this positive development, CryptoLogic Inc., a leading
    software supplier to the Internet gaming and e-commerce industries, is
    pleased to provide further detail of the settlement between
    CryptoLogic and WagerLogic, its wholly-owned subsidiary, and the New
    Jersey Divisions of Gaming Enforcement and Consumer Affairs with
    respect to the civil action filed on October 16, 2001.

    The following is the complete text of the settlement agreement.

    WHEREAS, as of the 23rd day of April, 2002, plaintiff, State of
    New Jersey and defendants, You must register/login in order to see the link. (as domain name only),
    Intertainet Overseas Licensing Limited (now known as WagerLogic
    Limited), Paris Lenas, Alex Specogna, and CryptoLogic, Inc., having
    agreed to amicably settle the litigation styled as State of New Jersey
    v. You must register/login in order to see the link., CCMH Ltd., Intertainet Overseas Licensing
    Limited, Paris Lenas, Alex Specogna, CryptoLogic, Inc., Docket No.
    MER-C-161-01;

    NOW, THEREFORE, for and in consideration of the mutual promises,
    covenants and detriments contained herein and for other good and
    valuable consideration, the receipt and sufficiency of which is hereby
    acknowledged, the parties agree as follows:

    1. The following terms shall be defined in the following manner in
    this Agreement:

    a. "State" refers to the State of New Jersey, the plaintiff
    herein.

    b. "WagerLogic" refers to WagerLogic, Ltd., the entity formerly
    known as Intertainet Overseas Licensing Limited, a defendant in this
    action.

    c. "Cryptologic" refers to defendant CryptoLogic, Inc.

    d. "Lenas" refers to defendant Paris Lenas.

    e. "Specogna" refers to defendant Alex Specogna.

    f. "Complaint" refers to the Complaint dated October 16, 2001 in
    the matter captioned above.

    g. "Settling Defendants" refers collectively to
    You must register/login in order to see the link. (as to domain name only), WagerLogic Limited
    (formerly Intertainet Overseas Licensing Limited), Paris Lenas, Alex
    Specogna and CryptoLogic, Inc.

    2. The Settling Defendants acknowledge that the Superior Court of
    New Jersey properly has jurisdiction over this matter and further
    acknowledge that service of the summons and Complaint upon the
    Settling Defendants was proper.

    3. CryptoLogic and WagerLogic represent that they do not presently
    own or operate any sports betting websites. CryptoLogic and WagerLogic
    further represent that they do not license or distribute any sports
    betting internet software.

    4. WagerLogic and CryptoLogic represent that they have caused the
    following entities, which are licensees of WagerLogic, to advise that
    they will not accept internet sports betting wagers from persons
    located within New Jersey:

    a. Caribbean Casino Management Holdings, Limited (websites under
    the URLs: intercasino.com; thesands.com; omnicasino.com;
    1on1casino.com; 49ercasino.com; and 3-diamonds-online-casino.com);

    b. Safari Casino N. V. (safaricasino.com);

    c. Fiestacasinos.com N.V. (blackjack.com); and

    d. William Hill Casino N.V. (williamhillcasino.com). 6 WagerLogic
    and CryptoLogic further represent that they will use their best
    efforts to prevent their current customers and/or licensees from
    accepting internet sports bets from persons located within New Jersey,
    unless and until it becomes legal to do so.

    5. WagerLogic and CryptoLogic agree that any licensing or related
    agreements they may enter into in the future will contain a provision
    prohibiting the licensee or other entity or individual with which
    WagerLogic or CryptoLogic contracts, from accepting sports bets from
    persons located within New Jersey, unless and until it becomes legal
    to do so.

    6. By entering into this Agreement, defendants neither make nor
    imply any admission as to any liability with respect to any claim
    alleged by or on behalf of the State. Defendants do not concede and
    expressly deny that they have violated any law, statute, ordinance,
    contract, duty or obligation whatsoever. The State agrees not to
    prosecute any of the Settling Defendants in connection with any of the
    alleged violations set forth in the Complaint.

    7. The State represents that it has no other charge, claim or
    complaint of any kind pending against the Settling Defendants, or any
    of them. The State agrees that it will not bring any action or suit
    against the Settling Defendants, or any of them, concerning matters of
    the nature alleged in the Complaint, which are generally characterized
    as sports wagering transactions, based on any claims which arose prior
    to the date of this Agreement. However, any party may bring an action
    to enforce this Agreement.

    8. The parties agree to execute and file with the Court a
    Stipulation of Dismissal with prejudice in the action styled above.
    Simultaneously with the execution of this Settlement Agreement, the
    State will execute a Stipulation of Dismissal, with prejudice and
    without costs, in the form attached hereto as Exhibit A.

    9. The parties to this Agreement acknowledge that each party had
    counsel and that the Agreement has been mutually negotiated between
    the parties and was drafted by the Settling Defendants as a matter of
    convenience only. Therefore, no party shall be deemed to be the
    drafter of this Agreement if any issue is raised with respect to its
    interpretation.

    10. This Settlement Agreement contains the entire agreement
    between the parties, and supercedes any prior or other agreements,
    understandings or communications, written or oral.

    11. This Settlement Agreement may be executed in one or more
    counterparts, each of which shall be deemed to be an original, but all
    of which shall constitute one in the same Settlement Agreement.

    12. The parties to this Settlement Agreement agree that they shall
    execute, acknowledge and deliver any and all other instruments or
    documents which are reasonably necessary to effectuate the purposes of
    this Settlement Agreement.

    13. This Settlement Agreement shall be governed by the laws of the
    State of New Jersey.

    IN WITNESS WHEREOF, the parties have executed the Settlement

    Agreement as of the date set forth above.



    DAVID SAMSON, ESQ.

    Attorney General of New Jersey

    Per: Thomas N. Auriemma, Assistant Attorney General



    PARIS LENAS

    You must register/login in order to see the link.

    (as to domain name only)



    PARIS LENAS

    WagerLogic, Limited

    (formerly Intertainet Overseas Licensing Limited)



    PARIS LENAS



    ALEX SPECOGNA



    JAMES A. RYAN

    CryptoLogic, Inc.

    CryptoLogic Inc. is the leading software development company
    serving the Internet gaming market. The company's proprietary
    technologies enable secure, high-speed financial transactions over the
    Internet. CryptoLogic continues to innovate and develop state of the
    art Internet software applications for both the electronic commerce
    and Internet gaming industries. WagerLogic, a wholly-owned subsidiary
    of CryptoLogic, is responsible for the licensing of its gaming
    software and services to customers around the world.

    CryptoLogic's common shares trade on the Toronto Stock Exchange
    under symbol the CRY and on the Nasdaq National Market under the
    symbol CRYP. There are currently 12.0 million common shares
    outstanding (14.4 million shares fully diluted). For more information,
    visit You must register/login in order to see the link. and You must register/login in order to see the link..

    CRYPTOLOGIC FORWARD LOOKING STATEMENT DISCLAIMER:

    Statements in this press release which are not historical are
    forward-looking statements made pursuant to the safe harbor provisions
    of the Private Securities Litigation Reform Act of 1995. Investors are
    cautioned that all forward-looking statements involve risks and
    uncertainties including, without limitation, risks associated with the
    Company's financial condition and prospects, legal risks associated
    with Internet gaming and risks of governmental legislation and
    regulation, risks associated with market acceptance and technological
    changes, risks associated with dependence on licensees and key
    licensees, risks relating to international operations, risks
    associated with competition and other risks detailed in the Company's
    filings with securities regulatory authorities. These risks may cause
    results to differ materially from those projected in the
    forward-looking statements.

    CONTACT:

    CryptoLogic Inc.

    Jean Noelting, 416/545-1455

    or

    James Ryan, 416/545-1455

    or

    Sean Stokes, 416/545-1455

    or

    Argyle Rowland

    416/968-7311

    or

    Argyle Rowland

    Daniel Tisch, 416/968-7311 ext. 223

    This email is not visible to you.

    or

    Aline Nalbandian, 416/968-7311 ext. 226

    This email is not visible to you.

    SOURCE: CryptoLogic Inc.

    Today's News On The Net - Business Wire's full file on the Internet
    with Hyperlinks to your home page.
    URL: You must register/login in order to see the link.


    05/01/2002 17:30 EASTERN
     
  4. May 2, 2002
  5. mary

    mary Dormant account

    New Licensees, Products Pave Way For European Growth; CryptoLogic Targets 50% Of Licensee Revenue From Non-U.S. Markets By Year-End


    TORONTO--(BUSINESS WIRE)--April 30, 2002--CryptoLogic Inc., (NASDAQ:CRYP)(TSE:CRY) a leading software supplier to the Internet gaming and e-commerce industries, is pleased to announce the following licensee- and product-related developments:

    -- Ritz Interactive Chooses CryptoLogic Software;

    -- Dukes Entertainment Chooses CryptoLogic Software And Enters

    Into Preferred Advertising Agreement With FreeLotto;

    -- Sports.com Casino Goes Live;

    -- Littlewoodscasino.com To Go Live In May; and,

    -- New CryptoLogic Bingo Product To Go Live In May.

    "CryptoLogic's strategy is to drive profitable growth by focusing on brand-name licensees operating in Tier-one regulated jurisdictions. Right now, this means Europe," said Jean Noelting, CryptoLogic's President and CEO, "and the signing of Ritz Interactive and Dukes Entertainment, the launch of Sports.com and the pending launch of Littlewoodscasino.com are prime examples of this strategy in action. As a result, we expect to return to growth in the second half of the year."

    "Our goal is for 50% of licensee revenue to be generated in non-U.S. markets by the end of 2002 through a combination of organic growth and the addition of four top-tier licensees," Noelting said. "I'm very pleased that, within the first half of the year, an already solid base of licensees has been further strengthened through the addition of three highly-regarded organizations which we expect will very quickly make an impact on the European Internet gaming marketplace."

    Ritz Interactive Chooses CryptoLogic Software

    Ritz Interactive Ltd. has chosen CryptoLogic software to bring The Ritz Club, one of the world's most exclusive privately-owned gaming clubs, on-line.

    An exclusive members-only club located in London's historic Ritz Hotel, The Ritz Club appeals to the true connoisseur of luxury and elegance. The Ritz Club's online casino will carry the same cachet, and a highly customized slate of games will mirror those offered to members in the London casino. Roulette, blackjack, punto banco and casino stud poker will all be available any time, online.

    Ritz Interactive, a wholly owned subsidiary of The Ritz Club established to pursue online, wireless and interactive television-related gaming activity, was recently awarded one of three online casino licenses in Alderney, a Tier-one regulatory environment with controls on par with those adhered to by land-based casinos.

    Dukes Entertainment Chooses CryptoLogic Software And Enters Into Preferred Advertising Agreement With FreeLotto

    Dukes Entertainment N.V., through its Dukesgaming.com website, will offer CryptoLogic's full slate of downloadable and Java casino games to players around the globe. Fully regulated and licensed in Curacao, Dukesgaming.com will provide players secure online gaming with a friendly and fun atmosphere. Dukesgaming.com is scheduled for launch in the second quarter.

    In support of its international strategy, Dukesgaming.com has entered into a long-term advertising agreement with PlasmaNet, Inc. PlasmaNet operates FreeLotto.com, the leading multilingual sweepstakes provider online. This agreement gives Dukesgaming.com access to FreeLotto.com's 24 million registered and qualified players worldwide. The most trusted sweepstakes site on the web, FreeLotto.com boasts over 5.7 million unique users and 1.6 billion page views per month.

    Dukes Entertainment N.V., incorporated in Curacao, Netherlands Antilles, is a wholly-owned subsidiary of The Dukes Partnership, an Isle of Man Partnership.

    PlasmaNet, Inc. is a leader in the online data mining and product promotion industry. FreeLotto.com originated the online lottery format sweepstakes, and thus far has awarded over $34 million in prizes, including one $10 million winner and eleven $1 million winners.

    Sports.com Casino Goes Live

    CryptoLogic is pleased to announce that the Sports.com Casino is now fully-launched and ready for the start of football's World Cup in June.

    Sports.com is the first licensee site to initially go live with CryptoLogic's recently launched suite of Java-based casino games. A downloadable casino version is currently in development. Based in Curacao, the Sports.com Casino is fully functional for play and payouts in British pounds sterling.

    Sports.com is one of the largest Internet sports brands and sports content providers in the world. Published in five languages, Sports.com has the highest traffic digital network for sports information and betting in Europe with over 4 million audited unique users via the Internet and wireless devices. Regulated and operating in the U.K., Sports.com's sportsbook provides its global users an online sports wagering service as a natural complement to its real-time, live and comprehensive sports coverage.

    Sports.com is a primary sports content provider to some of the world's best-known online news sites in the U.K., France, Germany, Spain, Italy and Ireland including Yahoo, AOL, MSN and Lycos, and supplies news and results to more than 30 newspapers in the U.K. Strong financial partners such as Soros Private Equity Partners, IMG, Reuters and Goldman Sachs have supported Sports.com's broad reaching success.

    Littlewoodscasino.com To Go Live In May

    CryptoLogic is pleased to confirm that software compliance testing is now in its final phase, and that Littlewoodscasino.com will go live on the Isle of Man in May as one of the first Tier-one regulated gaming sites on the Internet.

    Littlewoods Leisure is one of the best-known gaming organizations in the U.K., providing football pools, sports betting and lotteries to more than 1.6 million households per week. Littlewoodscasino.com will offer 30 single- and multi-player casino games with British pound sterling play and payouts.

    With a highly trusted brand name and large customer base, and the added benefit of operating from the Isle of Man under some of the most stringent regulations currently in place for Internet gaming, Littlewoods has a tremendous opportunity to quickly become a leading player in the rapidly growing Internet gaming marketplace.

    Littlewoods Leisure is a wholly-owned subsidiary of Sportech Plc., a U.K. company listed on the London Stock Exchange. Founded in 1923 as Littlewoods Pools, Littlewoods gaming products are distributed via telephone, the Internet, 15,000 retail shops and 13,000 door-to-door collectors.

    New CryptoLogic Bingo Product To Go Live In May

    CryptoLogic's leading-edge downloadable Bingo product will go live with its first licensee, InterBingo, on May 23, 2002. Discussions with other well-known brand-name licensees are underway.

    Emulating the traditional 75-number Bingo game played in Bingo halls around the world, CryptoLogic Bingo offers five play-for-money halls and one play-for fun hall, with themes customizable to the preference of each licensee.

    Backed by the Company's proven technological excellence, CryptoLogic Bingo offers all the features of a live bingo hall and more, including a Card Minder option to help players keep track of their card strips, and AutoDab, which allows the computer to dab players' cards for them.

    The addition of bingo is the next phase in CryptoLogic's market driven product strategy designed to enable licensees to tap into a wide range of vertical gaming opportunities to create profitable Internet businesses with broad appeal.

    About CryptoLogic

    CryptoLogic Inc. is the leading software development company serving the Internet gaming market. The company's proprietary technologies enable secure, high-speed financial transactions over the Internet. CryptoLogic continues to innovate and develop state of the art Internet software applications for both the electronic commerce and Internet gaming industries. WagerLogic, a wholly-owned subsidiary of CryptoLogic, is responsible for the licensing of its gaming software and services to customers around the world.

    CryptoLogic's common shares trade on the Toronto Stock Exchange under symbol the CRY and on the Nasdaq National Market under the symbol CRYP. There are currently 12.0 million common shares outstanding (14.4 million shares fully diluted). For more information, visit You must register/login in order to see the link. and You must register/login in order to see the link..

    CRYPTOLOGIC FORWARD LOOKING STATEMENT DISCLAIMER:

    Statements in this press release which are not historical are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that all forward-looking statements involve risks and uncertainties, including without limitation risks associated with the Company's financial condition and prospects, legal risks associated with Internet gaming and risks of governmental legislation and regulation, risks associated with market acceptance and technological changes, risks associated with dependence on licensees and key licensees, risks relating to international operations, risks associated with competition and other risks detailed in the Company's filings with securities regulatory authorities. These risks may cause results to differ materially from those projected in the forward-looking statements.

    CONTACT:

    CryptoLogic Inc.

    Jean Noelting, 416/545-1455

    or

    James Ryan, 416/545-1455

    or

    Sean Stokes, 416/545-1455

    Fax: 416/545-1454

    or

    Media Inquiries: Argyle Rowland Worldwide

    Daniel Tisch, 416/968-7311, ext. 223

    This email is not visible to you.

    or

    Aline Nalbandian, 416/968-7311, ext. 226

    This email is not visible to you.

    SOURCE: CryptoLogic Inc.

    Today's News On The Net - Business Wire's full file on the Internet with Hyperlinks to your home page. URL: You must register/login in order to see the link.
    04/30/2002 07:03 EASTERN
     
  6. May 2, 2002
  7. mary

    mary Dormant account

    CryptoLogic Remains Solidly Profitable In First Quarter Of 2002; Profitable Targets Established For Balance Of Year


    TORONTO--(BUSINESS WIRE)--April 30, 2002--CryptoLogic Inc.,
    (NASDAQ:CRYP) (TSE:CRY) a leading software supplier to the Internet
    gaming and e-commerce industries, is pleased to announce financial
    results for the first quarter of 2002 and profitable targets for the
    balance of the year.

    In the quarter ended March 31, 2002, the Company generated net
    income of $2.2 million on revenue of $8.7 million. Total cash at the
    end of the quarter was $34.4 million.

    "CryptoLogic remained solidly profitable and in line with guidance
    in what was a transitional quarter for the industry," said Jean
    Noelting, President and CEO. "This is a testimony to the strength of
    our international business base, and an endorsement of the Company's
    strategy to remain focused on growing the business globally in markets
    that embrace on-line gaming."

    "We continue to maintain that the toughest quarter is behind us,"
    Noelting added. "While the impact of the U.S. credit card issue will
    continue to be felt, we expect the Sports.com Casino and the launches
    of Littlewoods Casino, Ritz Casino, Dukes Casino and our new Bingo
    product will help bring about a return to earnings growth in the
    second half of the year."

    As such, the Company is providing the following updated guidance
    for 2002:

    Second Quarter 2002 projections:

    -- Revenue between $9.5 million and $10.5 million;

    -- Net Income between $2.5 million and $3.0 million; and,

    -- Diluted EPS between $0.19 and $0.22.

    Fiscal 2002 projections:

    -- Revenue between $44.0 million and $46.0 million;

    -- Net income between $13.5 million and $15.0 million; and,

    -- Diluted EPS between $1.01 and $1.12.

    Financial Highlights

    As expected, first quarter revenue decreased year-over-year to
    $8.7 million, compared with $10.9 million in the first quarter of
    2001. The decrease was principally due to the decision in the fourth
    quarter of 2001 by certain U.S.-based banks to limit the use of their
    credit cards for Internet gaming transactions and the resulting delay
    in the realization of revenue as U.S. players moved to alternate forms
    of payment.

    "Lower revenue in the quarter reflects the short-term challenge
    being faced by the entire industry as it adjusts to the impact of the
    U.S. credit card situation. This pressure was anticipated, and has
    been factored in to our projections for the year," Noelting added.
    "That said, by the end of the quarter approximately 50% of the revenue
    decrease experienced in December 2001 had been recovered."

    Net income in the quarter was $2.2 million, or $0.18 per share

    ($0.16 per diluted share), compared with net income of $5.2 million,
    or $0.37 per share ($0.34 per diluted share), in the first quarter of
    the prior year. Net margin for the first quarter was 25%.

    Net income was affected in part by a 78% decrease in interest
    income to $0.2 million from $0.8 million in the first quarter of 2001,
    due to lower prevailing interest rates and decreased cash reserves
    than in the corresponding period of the previous year.

    The Company remained well funded, with $34.4 million in total cash
    on the balance sheet at March 31. Significant uses of cash during the
    quarter included the utilization of both Substantial and Normal Course
    Issuer Bids to buy back common shares as a means of enhancing
    shareholder value, and an investment in Sports.com to further the
    Company's international growth strategy.

    Under the Substantial Issuer Bid that expired on January 11, 2002,
    the Company repurchased 1,004,934 common shares at a total cost of
    $17.8 million, including fees. CryptoLogic also continued to make use
    of its Normal Course Issuer Bid, which expires on May 17, 2002,
    repurchasing 165,500 common shares during the quarter at a cost of
    approximately $2.0 million. The Company intends to renew its Normal
    Course Issuer Bid for the May 2002-May 2003 period.

    In February, the Company expanded its presence in the European
    market by securing a long-term licensing and purchase option agreement
    with Sports.com, Europe's leading digital sports channel, through an
    investment of approximately $6.0 million. With over 4.0 million unique
    audited users of its sports content and U.K.-regulated sports wagering
    services per month, Sports.com boasts tremendous European coverage.
    The Sports.com Casino is the first licensee site to initially go live
    with CryptoLogic's suite of Java casino games, launched in February.

    Outlook

    Despite the short-term impact of the U.S. credit card situation,
    Management is confident in its projections for 2002, in the long-term
    vitality of the Internet gaming industry and in the fundamental
    strength of the Company and its business model. The Company remains
    focused on profitable growth by expanding its presence worldwide,
    primarily in Europe and Asia, with brand-name licensees; by remaining
    a leader in regulatory compliance; and, by adding products through
    development or acquisition to drive organic growth of licensee sites
    and enter new vertical gaming markets.

    The above forward-looking statements are based on the Company's
    current expectations, and are subject to risks and uncertainties.
    Actual results may differ materially.

    Conference Call and Webcast

    A conference call and webcast to discuss these results and the
    Company's outlook will be held at 8:30 a.m. Toronto time on Tuesday
    April 30, 2002. Interested parties should call 416-695-5801 or
    1-800-478-9326, or visit You must register/login in order to see the link. and click on Investor
    Info. A replay of the call can be accessed by calling 416-695-5800 or
    1-800-408-3053 and entering passcode 1135626, or at You must register/login in order to see the link..

    About CryptoLogic

    CryptoLogic Inc. is the leading software development company
    serving the Internet gaming market. The company's proprietary
    technologies enable secure, high-speed financial transactions over the
    Internet. CryptoLogic continues to innovate and develop state of the
    art Internet software applications for both the electronic commerce
    and Internet gaming industries. WagerLogic, a wholly owned subsidiary
    of CryptoLogic, is responsible for the licensing of its gaming
    software and services to customers around the world.

    CryptoLogic's common shares trade on the Toronto Stock Exchange
    under symbol the CRY and on the Nasdaq National Market under the
    symbol CRYP. There are currently 12.0 million common shares
    outstanding (14.4 million shares diluted). For more information, visit
    You must register/login in order to see the link. and You must register/login in order to see the link..

    CRYPTOLOGIC FORWARD LOOKING STATEMENT DISCLAIMER:

    Statements in this press release which are not historical are
    forward-looking statements made pursuant to the safe harbor provisions
    of the Private Securities Litigation Reform Act of 1995. Investors are
    cautioned that all forward-looking statements involve risks and
    uncertainties, including without limitation risks associated with the
    Company's financial condition and prospects, legal risks associated
    with Internet gaming and risks of governmental legislation and
    regulation, risks associated with market acceptance and technological
    changes, risks associated with dependence on licensees and key
    licensees, risks relating to international operations, risks
    associated with competition and other risks detailed in the Company's
    filings with securities regulatory authorities. These risks may cause
    results to differ materially from those projected in the
    forward-looking statements.

    CRYPTOLOGIC INC.

    CONSOLIDATED BALANCE SHEETS

    (In thousands of U.S. Dollars)

    (Unaudited)

    As at As at

    March 31, 2002 December 31, 2001

    ASSETS



    Current assets:

    Cash and cash equivalents $ 19,815 $ 42,822

    Restricted cash 14,540 16,800

    Reserve with processors 981 144

    Accounts receivable 1,658 697

    Income taxes recoverable - 408

    Prepaid expenses and other 1,212 768

    --------- ---------

    38,206 61,639



    Investments 8,413 2,480



    Capital assets 3,063 2,949



    Intangible assets 310 337



    Goodwill 1,040 1,040



    --------- ---------

    $ 51,032 $ 68,445

    --------- ---------

    --------- ---------



    LIABILITIES AND

    SHAREHOLDERS' EQUITY



    Current liabilities:

    Accounts payable $ 2,038 $ 2,704

    Accrued liabilities 1,119 1,389

    Income taxes payable 98 -

    Funds held on deposit 4,043 3,263

    --------- ---------

    7,298 7,356

    --------- ---------



    Shareholders' Equity:

    Capital stock 8,590 8,720

    Retained earnings 35,144 52,369

    --------- ---------

    43,734 61,089

    --------- ---------

    $ 51,032 $ 68,445

    --------- ---------

    --------- ---------





    CRYPTOLOGIC INC.

    CONSOLIDATED STATEMENTS OF INCOME

    (In thousands of U.S. Dollars)

    (Unaudited)

    For the three months ended

    -----------------------------------

    March 31, 2002 March 31, 2001



    Revenue $ 8,664 $ 10,865

    --------- ---------



    Expenses

    Software development and support 4,791 4,963

    General and administrative 1,224 783

    Finance 137 75

    Amortization 197 63

    --------- ---------

    6,349 5,884

    --------- ---------



    Income from operations 2,315 4,981



    Interest income 175 790

    --------- ---------



    Net income before taxes 2,490 5,771



    Provision for income taxes 286 589

    --------- ---------



    Net income $ 2,204 $ 5,182

    --------- ---------

    --------- ---------



    Earnings per share

    Basic $ 0.18 $ 0.37

    Diluted $ 0.16 $ 0.34



    Weighted Average Number of

    Shares ('000s)

    Basic 12,210 14,038

    Diluted 13,569 15,252





    Cryptologic Inc.

    Consolidated Statements of Changes in Shareholders' Equity

    (In thousands of U.S. Dollars)

    (Unaudited)

    Three Months Ended Three Months Ended

    March 31, 2002 March 31, 2001

    ------------------------------------------

    Number of Stated Number of Stated

    Shares Value Shares Value

    ('000s) ($) ('000s) ($)

    Common shares:

    Balance, beginning

    of period 13,137 8,448 14,079 6,455

    Repurchase of shares (1,170) (367) (119) (40)

    Exercise of stock

    options 25 237 87 420

    ------------------ ------------------

    11,992 8,318 14,047 6,835

    ------------------ ------------------

    Series c warrants:

    Balance, beginning

    of period - - 160 22

    ------------------ ------------------

    Balance, end of

    period - - 160 22



    Series f warrants:

    Balance, beginning

    of period 30 272 - -

    ------------------ ------------------

    Balance, end of

    period 30 272 - -

    ------------------ ------------------



    Total capital stock 12,022 8,590 14,207 6,857

    ------------------ ------------------





    Retained earnings,

    beginning of period 52,369 51,133

    Net income 2,204 5,182

    Excess of purchase price

    of treasury shares

    over stated value (19,429) (1,175)

    --------- ---------

    Retained earnings, end

    of period 35,144 55,140

    --------- ---------



    Total shareholders'

    equity 43,734 61,997

    --------- ---------

    --------- ---------





    Cryptologic Inc.

    Statement of Cash Flows

    (In thousands of U.S. Dollars)

    (Unaudited)

    Three Months Ended

    March 31, 2002 March 31, 2001

    -----------------------------------

    Cash provided by (used in):



    Operating activities:

    Net income $ 2,204 $ 5,182

    Adjustments to reconcile

    income to

    Cash provided by (used in)

    operating activities:

    Amortization 197 63

    Changes in operating

    assets and liabilities:

    Restricted cash 2,260 (500)

    Reserves with processors (837) (206)

    Accounts receivable (961) 979

    Prepaid expenses and other (444) (380)

    Income taxes 506 625

    Accounts payable (666) (616)

    Accrued liabilities (270) 207

    Funds held on deposit 780 395

    --------- ---------

    2,769 5,749

    --------- ---------





    Financing activities:

    Issue of capital stock for

    cash 237 420

    Repurchase of common

    shares (19,796) (1,215)

    --------- ---------

    (19,559) (795)

    --------- ---------





    Investing activities:

    Additions to capital

    assets (284) (65)

    Investments (5,933) (921)



    --------- ---------

    (6,217) (986)

    --------- ---------



    Increase in cash and cash

    equivalents (23,007) 3,968



    Cash and cash equivalents,

    beginning of period 42,822 42,696

    --------- ---------



    Cash and cash equivalents,

    end of period $ 19,815 $ 46,664

    --------- ---------

    --------- ---------



    NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS

    As at March 31, 2002

    (Unaudited)

    Inc. ("the Company") have been prepared in accordance with Canadian
    generally accepted accounting principles using the same accounting
    policies as were used for the consolidated financial statements for
    the year ended December 31, 2001, except as described below in a
    change in accounting policy (note 1). These consolidated interim
    financial statements should be read in conjunction with the
    consolidated financial statements for the year ended December 31,
    2001, as set out in the 2001 Annual Report.

    1. Change in Accounting Policy

    Effective January 1, 2002, the Company adopted the new
    Recommendations of the Canadian Institute of Chartered Accountants
    with respect to the accounting for stock-based compensation and other
    stock-based payments. The new Recommendations are applied
    prospectively to all stock-based payments to non-employees, and to
    employee awards that are direct awards of stock, call for settlement
    in cash or other assets, or are stock appreciation rights that call
    for settlement by the issuance of equity instruments, granted on or
    after January 1, 2002. Outstanding grants as at January 1, 2002 that
    call for settlement in cash or other assets or stock appreciation
    rights that call for settlement in equity instruments are applied
    retroactively, without restatement. The Company does not have any such
    grants as at January 1, 2002 and as such will apply the new
    recommendations prospectively.

    In accordance with the new standard, the Company will continue its
    existing policy that no compensation cost is recorded on the grant of
    stock options to employees. Consideration paid by employees on the
    exercise of stock options is recorded as share capital. However, under
    the new standard the Company is required to provide additional pro
    forma disclosures for options granted to employees as if the fair
    value based accounting method had been used to account for employee
    stock options.

    The fair value of the options granted were made using the
    Black-Scholes option pricing model using a dividend yield of 0% and
    the following weighted assumptions.

    Risk-free rate 2.0%

    Expected volatility 100.0%

    Expected life of options in years 5.0

    of the employee stock option awards granted on or after January 1,
    2002, in accordance with the new recommendations, the Company's net
    income and earnings per share would have been changed to the following
    amounts:

    As reported Pro forma

    ('000) ('000)

    Net income $ 2,204 $ 2,134



    Net income per share

    Basic $ 0.18 $ 0.18

    Diluted $ 0.16 $ 0.16

    In February 2002 the company acquired an option to purchase 100%
    of the shares of SCG Enterprises Limited (SCGE) an Internet gaming
    operator, for $5,933,000. The exercise price for the shares is 1 Pound
    Sterling, and the option expires February 2005.

    3. Substantial Issuer Bid

    On January 11, 2002 the Company purchased 1,004,934 CryptoLogic
    common shares at a price of CDN$28.00 per share for a total cost,
    including transaction costs, of CDN$28,353,000 (US$17,763,000).

    4. Normal Course Issuer Bid

    In May 2001, the Board of Directors approved the repurchase and
    cancellation of up to 656,000 of the Company's outstanding common
    shares for the period commencing May 18, 2001 and ending May 17, 2002.
    As at March 31, 2002, the Company under this plan has cumulatively
    repurchased and cancelled 440,500 common shares, of which 165,500
    common shares were repurchased and canceled during the period January
    1, 2002 to March 31, 2002 at a cost of $2,033,000.

    5. Contingencies

    The Company has been named in several lawsuits incurred in the
    ordinary course of business. In the opinion of Management, the claims
    are without merit and no provision has been made in the accounts.

    6. Subsequent Events

    On April 8, 2002, the Company sold 100% of its investment in Dot
    Com Entertainment Group Inc. (DCEG-OTCBB), representing 1,055,700
    common shares for $1,056,000.

    CONTACT:

    CryptoLogic Inc.

    Jean Noelting, 416/545-1455

    or

    James Ryan, 416/545-1455

    or

    Sean Stokes, 416/545-1455

    Fax: 416/545-1454

    or

    Media Inquiries: Argyle Rowland Worldwide

    Daniel Tisch, 416/968-7311, ext. 223

    This email is not visible to you.

    or

    Aline Nalbandian, 416/968-7311, ext. 226

    This email is not visible to you.

    SOURCE: CryptoLogic Inc.

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    04/30/2002 07:03 EASTERN
     
  8. Oct 15, 2002
  9. tjoe

    tjoe Guest

    So is it alright to play at Dukesgaming? Has anyone ever complained about them. The casino seems to have all in order. Even a phone number!
    It advertises it's software.
    Forgive me but I am a little gun shy now. I had a bad experience.
    So does anyone out there have an opinion?
     

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