INFOCAST CORP /NV, DEFM14A, 2000-07-20

INFOCAST CORP /NV
DEFM14A, 2000-07-20
BUSINESS SERVICES, NEC

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<PAGE> 1

SCHEDULE 14A INFORMATION

PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )

Filed by the Registrant [X]

Filed by a Party other than the Registrant [ ]

Check the appropriate box:

[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-12

INFOCAST CORPORATION
--------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

--------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than Registrant)

Payment of Filing Fee (Check the appropriate box):

[ ] No fee required.

[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

(1) Title of each class of securities to which transaction applies:

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

(2) Aggregate number of securities to which transaction applies:

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

(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):

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

(4) Proposed maximum aggregate value of transaction:

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

(5) Total fee paid:

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

[X] Fee paid previously with preliminary materials.

[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.

(1) Amount Previously Paid:

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

(2) Form, Schedule or Registration Statement No.:

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

(3) Filing Party:

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

(4) Date Filed:

------------------------------------------------------------------------
<PAGE> 2

INFOCAST CORPORATION

July 21, 2000

Dear Shareholders:

You are cordially invited to attend a Special Meeting of Shareholders (the
"Meeting") of InfoCast Corporation, a Nevada corporation (the "Company"), which
will be held at the offices of Olshan Grundman Frome Rosenzweig & Wolosky LLP,
located at 505 Park Avenue, New York, New York 10022, on August 14, 2000, at
10:00 a.m., local time.

Information about the Meeting, including a listing and discussion of the
matters on which shareholders will act, may be found in the enclosed Notice of
Special Meeting of Shareholders and Proxy Statement.

As described in the accompanying Notice of Special Meeting of Shareholders
and Proxy Statement, at this important meeting shareholders will be asked to
consider and vote upon a proposed merger (the "Merger") of i360 inc. ("i360")
with and into the Company, pursuant to an Agreement and Plan of Merger (the
"Merger Agreement"), dated May 3, 2000, as amended, by and between the Company
and i360. In addition, shareholders will also be asked to consider and vote upon
a proposal to approve the adoption of the Company's 2000 Stock Option Plan.

The Company's Board of Directors has carefully considered the terms and
conditions of the proposed Merger and believes that the Merger is in the best
interests of the Company's shareholders. The Board of Directors has approved the
Merger and the other proposals described in the Proxy Statement and recommends
that shareholders vote for the adoption and approval of the Merger Agreement and
the other proposals described in the Proxy Statement.

We hope that you will be able to attend the Meeting. However, whether or
not you anticipate attending in person, I urge you to complete, sign and return
the enclosed proxy card promptly to ensure that your shares will be represented
at the Meeting. If you do attend, you will, of course, be entitled to vote in
person, and if you vote in person such vote will nullify your proxy.

Sincerely,

/s/ James Leech
JAMES LEECH
President and Chief Executive Officer
<PAGE> 3

INFOCAST CORPORATION
1 RICHMOND STREET WEST, SUITE 902
TORONTO, ONTARIO M5H 3W4
CANADA
------------------------

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD AUGUST 14, 2000
------------------------

NOTICE IS HEREBY GIVEN that a Special Meeting of Shareholders of InfoCast
Corporation, a Nevada corporation (the "Company"), will be held at the offices
of Olshan Grundman Frome Rosenzweig & Wolosky LLP, located at 505 Park Avenue,
New York, New York 10022, on August 14, 2000 at 10:00 a.m., local time, for the
following purposes:

(a) To consider and vote upon a proposed merger (the "Merger") of i360
inc., a Utah corporation ("i360"), with and into the Company pursuant to an
Agreement and Plan of Merger, dated May 3, 2000 (the "Merger Agreement"),
as amended, by and between the Company and i360 (the "Merger Proposal"). As
a result of the Merger, each outstanding share of common stock of i360, no
par value per share (the "i360 Common Stock"), will be converted into the
right to receive from the Company 0.30 shares of the Company's common
stock, $.001 par value per share (the "Company Common Stock"). The
outstanding options to purchase shares of i360 Common Stock (the "i360
Options") will be converted into 4,416,000 warrants and 1,030,803 options
(the "i360 Employee Options") which warrants and i360 Employee Options will
entitle the holders thereof to purchase an aggregate of approximately
5,446,803 additional shares of Company Common Stock and the Company will
issue additional employee options to purchase 469,197 shares of Company
Common Stock to future employees of i360. Upon consummation of the Merger,
Mr. William G. Cochrane and Mr. S. Drexel Ridley (the "Director
Appointees") will be appointed to the Company Board;

THE MERGER IS CONTINGENT UPON THE APPROVAL OF THE MERGER PROPOSAL. THE
COMPANY AND I360 WILL NOT COMPLETE THE MERGER UNLESS THE COMPANY'S
SHAREHOLDERS ADOPT AND APPROVE THE MERGER AGREEMENT AND THE TRANSACTIONS
CONTEMPLATED BY IT.

(b) To approve the adoption of the Company's 2000 Stock Option Plan
(the "2000 Plan"); and

The Company's shareholders have the right to dissent from the Merger and
demand appraisal rights for their shares, provided that the Merger is
consummated and such shareholders comply with the requirements of the Nevada
Revised Statutes. See "Dissenter's Rights" in the accompanying Proxy Statement
and the relevant sections of the Nevada Revised Statutes attached hereto as
Annex C for a description of the rights of dissenting shareholders and a
discussion of the procedures which must be followed by the Company's
shareholders to obtain appraisal of their shares.

THE COMPANY BOARD HAS ADOPTED AND APPROVED THE MERGER PROPOSAL AND THE 2000
PLAN AND RECOMMENDS THAT THE COMPANY'S SHAREHOLDERS VOTE FOR THE MERGER PROPOSAL
AND THE 2000 PLAN.

ALL INFORMATION PERTAINING TO I360 INC. HAS BEEN FURNISHED BY I360 INC.
<PAGE> 4

Only shareholders of record at the close of business on July 5, 2000 will
be entitled to notice of and to vote at the Meeting or at any postponement or
adjournment thereof.

By Order of the Board of Directors,

/s/ Herve Seguin
HERVE SEGUIN
Chief Financial Officer and Secretary

Toronto, Ontario
July 21, 2000

TO ASSURE YOUR REPRESENTATION AT THE MEETING, WHETHER OR NOT YOU PLAN TO ATTEND,
PLEASE VOTE, SIGN AND DATE THE ENCLOSED PROXY AND RETURN IT IN THE ENCLOSED
ENVELOPE. THE GIVING OF A PROXY WILL NOT AFFECT YOUR RIGHT TO REVOKE SUCH PROXY
BY APPROPRIATE WRITTEN NOTICE OR BY VOTING IN PERSON AT THE MEETING. PLEASE NOTE
THAT IF YOUR SHARES ARE HELD OF RECORD BY A BROKER, BANK OR OTHER NOMINEE AND
YOU WISH TO VOTE AT THE MEETING, YOU MUST BRING TO THE MEETING A LETTER FROM THE
BROKER, BANK OR OTHER NOMINEE CONFIRMING YOUR BENEFICIAL OWNERSHIP OF THE SHARES
AND YOU MUST OBTAIN FROM THE RECORD HOLDER A PROXY ISSUED IN YOUR NAME.
<PAGE> 5

INFOCAST CORPORATION
1 RICHMOND STREET WEST, SUITE 902
TORONTO, ONTARIO M5H 3W4
CANADA
------------------------

PROXY STATEMENT
FOR A SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD AUGUST 14, 2000
------------------------

INTRODUCTION

This Proxy Statement is furnished to the shareholders of INFOCAST
CORPORATION, a Nevada corporation (together with its subsidiaries, collectively,
the "Company"), in connection with the solicitation by the Board of Directors of
the Company (the "Company Board") of proxies ("Proxies") for use at its special
meeting of shareholders (the "Meeting") to be held at the offices of Olshan
Grundman Frome Rosenzweig & Wolosky LLP, located at 505 Park Avenue, New York,
New York 10022, on August 14, 2000, at 10:00 a.m., local time, or at any
adjournment or postponement thereof. The approximate date on which this Proxy
Statement and the accompanying Proxy will be first sent or given to shareholders
is July 21, 2000. The purposes of the Meeting are as follows:

(a) To consider and vote upon a proposal to adopt and approve the
terms of a proposed merger (the "Merger") of i360 inc., a Utah corporation
("i360"), with and into the Company pursuant to an Agreement and Plan of
Merger, dated May 3, 2000 (the "Merger Agreement"), as amended, by and
between the Company and i360 (the "Merger Proposal"). As a result of the
Merger, each outstanding share of common stock of i360, no par value per
share (the "i360 Common Stock"), will be converted into 0.30 shares of the
Company's common stock, $.001 par value per share (the "Company Common
Stock"). The outstanding options to purchase shares of i360 Common Stock
(the "i360 Options") will be converted into 4,416,000 warrants and
1,030,803 options (the "i360 Employee Options") which warrants and i360
Employee Options will entitle the holders thereof to purchase an aggregate
of approximately 5,446,803 additional shares of Company Common Stock and
the Company will issue additional employee options to purchase 469,197
shares of Company Common Stock to future employees of i360. Upon
consummation of the Merger, Mr. William G. Cochrane and Mr. S. Drexel
Ridley (the "Director Appointees") will be appointed to the Company Board;

(b) To approve the adoption of the Company's 2000 Stock Option Plan
(the "2000 Plan"); and

THE COMPANY BOARD HAS ADOPTED AND APPROVED THE MERGER PROPOSAL AND THE 2000
PLAN AND RECOMMENDS THAT THE COMPANY'S SHAREHOLDERS VOTE FOR THE MERGER PROPOSAL
AND THE 2000 PLAN.

ALL INFORMATION PERTAINING TO I360 HAS BEEN FURNISHED BY I360.

THE DATE OF THIS PROXY STATEMENT
IS JULY 21, 2000
<PAGE> 6

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
SUMMARY..................................................... 1
WHERE YOU CAN FIND MORE INFORMATION......................... 5
QUESTIONS AND ANSWERS ABOUT THE MERGER...................... 6
CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING
STATEMENTS................................................ 8
SPECIAL MEETING............................................. 9
DATE, TIME, PLACE AND PURPOSE............................. 9
RECORD DATE, VOTING SECURITIES AND QUORUM................. 9
RECOMMENDATIONS OF THE BOARD OF DIRECTORS................. 9
PROXIES AND VOTING RIGHTS................................. 9
VOTE REQUIRED............................................. 9
SOLICITATION OF PROXIES................................... 10
PROPOSAL NO. 1
THE MERGER.................................................. 10
Background of the Merger.................................. 10
Recommendation of the Company Board....................... 11
Reasons for the Merger; Factors Considered by the Company
Board.................................................. 11
Opinion of Houlihan Lokey Howard & Zukin.................. 12
Material Financial Analyses Regarding i360................ 13
Pro Forma Accretion Analysis.............................. 14
Fairness of Consideration................................. 14
General................................................... 14
Federal Income Tax Considerations......................... 15
Dilution.................................................. 15
Management After the Merger............................... 15
Vote Required............................................. 16
Indemnification........................................... 16
Employment Agreements..................................... 16
THE MERGER AGREEMENT........................................ 16
Terms of the Merger; Merger Consideration................. 16
Effective Time of the Merger.............................. 17
Manner and Basis of Converting Shares..................... 17
Escrow of Shares.......................................... 17
Exchange of Certificates.................................. 18
Representations and Warranties............................ 18
Conduct of Business Prior to Closing...................... 18
Acquisition Proposals..................................... 18
Closing Conditions........................................ 19
Waiver of Conditions...................................... 19
Voting Agreement.......................................... 19
Registration Rights....................................... 19
</TABLE>

i
<PAGE> 7

<TABLE>
<CAPTION>
PAGE
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<S> <C>
Listing of Company Common Stock to Be Issued in the
Merger................................................. 20
Governmental and Regulatory Approvals..................... 20
Merger Expense Reimbursement; Breakup Fee................. 20
Termination............................................... 20
Dissenters' Rights........................................ 20
Certain Effects of the Merger on the Rights of InfoCast
and i360 Shareholders.................................. 21
LOAN TO i360 BY INFOCAST.................................... 21
BUSINESS OF i360............................................ 22
Industry Overview......................................... 22
Sources of Revenue........................................ 23
Products and Services..................................... 23
Membership/Premium Services............................... 24
Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure.................... 25
SELECTED CONSOLIDATED FINANCIAL DATA OF i360................ 26
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS OF i360......................... 27
Overview.................................................. 27
Purchase of Innovative Technology Solutions............... 28
Results of Operations..................................... 28
Liquidity and Capital Resources........................... 28
Year 2000 Compliance...................................... 28
SELECTED CONSOLIDATED FINANCIAL DATA OF THE COMPANY......... 30
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS OF THE COMPANY.................. 31
PRINCIPAL SHAREHOLDERS OF THE COMPANY....................... 36
HISTORICAL AND PRO FORMA COMPARATIVE PER SHARE DATA OF THE
COMPANY AND i360 (UNAUDITED).............................. 39
MARKET PRICE OF THE COMPANY'S COMMON STOCK AND RELATED
STOCKHOLDER MATTERS....................................... 40
DIVIDEND POLICY............................................. 40
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS OF THE
COMPANY................................................... 40
PROPOSAL NO. 2
APPROVAL OF ADOPTION OF THE 2000 STOCK OPTION PLAN.......... 41
Administration of the Plan................................ 42
Common Stock Subject to the 2000 Plan..................... 42
Participation............................................. 42
Option Price.............................................. 43
Terms of Options.......................................... 43
Restrictions on Grant and Exercise........................ 43
Registration of Shares.................................... 43
Rule 16b-3 Compliance..................................... 43
Tax Treatment of Incentive Stock Options.................. 43
</TABLE>

ii
<PAGE> 8

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Tax Treatment of Nonqualified Stock Options............... 44
Withholding of Tax........................................ 44
Option Grants............................................. 44
Required Vote............................................. 44
Recommendation of the Board of Directors.................. 44
OTHER BUSINESS.............................................. 44
INDEX TO FINANCIAL STATEMENTS............................... F-1
ANNEX A -- FAIRNESS OPINION OF MERGER
ANNEX B -- MERGER AGREEMENT, AS AMENDED
ANNEX C -- DISSENTERS' RIGHTS STATUTE
ANNEX D -- REGISTRATION RIGHTS AGREEMENT
ANNEX E -- 2000 STOCK OPTION PLAN
</TABLE>

iii
<PAGE> 9

SUMMARY

This summary highlights selected information from this document and may not
contain all of the information that is important to you. For a more complete
understanding of the merger and for a more complete description of the legal
terms of the merger, you should carefully read this entire document, the merger
agreement which is attached as Annex B and the other available information
referred to in "Where You Can Find More Information" on page 7. For convenience,
in this proxy statement, i360 inc. will be referred to as "i360" and InfoCast
Corporation will be referred to as "InfoCast," the "Company" or by the terms
"we", "us" or "our".

THE COMPANIES (See pages 22 and 27)

<TABLE>
<S> <C>
InfoCast Corporation Corporate Office
4343 Commerce Court InfoCast Corporation
Suite 610 1 Richmond Street West, Suite 902
Lisle, Illinois 60532 Toronto, Ontario M5H 3W4
(630) 955-2300 Canada
(416) 867-1681
</TABLE>

We are an e-enabling application service provider, providing secure,
scalable infrastructure-on-demand for enterprises to build offerings, including
virtual call centers and e-learning applications, coupled with related
best-of-breed offerings for customer care, data warehousing and e-commerce. We
are a Nevada corporation, with offices in Chicago, Illinois and Annapolis,
Maryland, and Toronto, Ontario, Calgary, Alberta and Halifax, Nova Scotia.

i360 inc.
407 W. Congress
Tucson, Arizona 85701
(520) 617-8344

i360 is a Utah corporation based in Tucson, Arizona, which provides
customized portals for virtual communities. i360 provides privately-branded
portal and virtual community systems and bundles Internet access with compelling
content, targeted business products, e-commerce and customer support, accessible
through personal computers or i360's netHomeTV Internet(TM) appliance.

i360 is not an affiliate of InfoCast.

OVERVIEW OF THE TRANSACTION

The merger agreement provides that i360 will be merged with and into
InfoCast. In order for the merger to happen, a majority of our shareholders must
approve the merger at this meeting.

THE SPECIAL MEETING (See page 9)

The special meeting of our shareholders is scheduled to be held at the
offices of Olshan Grundman Frome Rosenzweig & Wolosky LLP, located at 505 Park
Avenue, New York, New York 10022, on August 14, 2000, at 10:00 a.m., local time.

RECORD DATE; VOTING POWER (See page 9)

Our board of directors has fixed the close of business on July 5, 2000 as
the record date to determine holders of shares of our stock entitled to notice
of and to vote at the special meeting.

As of the record date, there were 21,423,174 shares of our common stock
issued and outstanding, held by approximately 248 record holders. If you held
common stock at the close of business on the record date, you are entitled to
one vote per share on any matter that may properly come before the special
meeting.

1
<PAGE> 10

VOTING SECURITIES AND VOTES REQUIRED (See page 9)

The merger requires the approval of holders of a majority of the shares of
our common stock outstanding on July 5, 2000. Our directors, executive officers
and their affiliates held a total of approximately 42.8% of the shares of our
common stock outstanding on the record date and have indicated their intention
to vote their shares "FOR" the adoption of the merger agreement.

i360 and its affiliates held no shares of our common stock on the record
date.

OPINION OF THE COMPANY'S FINANCIAL ADVISOR ON THE MERGER (See page 12)

The board of directors has received the opinion of Houlihan Lokey Howard &
Zukin, their financial advisor, dated June 13, 2000. The opinion states that as
of the date of the opinion, the consideration to be paid by the Company in
connection with the merger is fair, from a financial point of view.

For its services in connection with the merger, Houlihan Lokey Howard &
Zukin received a fee for rendering its opinion as to the fairness, from a
financial point of view, of the merger. The full text of the written opinion of
Houlihan Lokey Howard & Zukin is attached to this proxy statement as Annex A,
and you should read it carefully. THE OPINION OF HOULIHAN LOKEY HOWARD & ZUKIN
IS DIRECTED TO THE BOARD OF DIRECTORS AND IS NOT A RECOMMENDATION TO YOU AS TO
HOW YOU SHOULD VOTE AT THE SPECIAL MEETING.

THE MERGER AGREEMENT

The following is a brief summary of certain provisions of the merger
agreement. For more detail, see "The Merger Agreement" starting on page 16 and
the pages referred to below and the copy of the merger agreement annexed as
Annex B to this proxy statement.

Merger Consideration (See page 16)

Shareholders of i360 will receive in the merger 0.30 shares of our common
stock in exchange for each issued and outstanding share of i360's common stock.
The shares of our common stock received by shareholders of i360 pursuant to the
merger agreement are referred to herein as the "merger consideration."

Conversion of i360 Common Stock (See page 16)

Upon consummation of the merger, all outstanding shares of i360's common
stock will cease to be outstanding and will be converted into the right to
receive the merger consideration.

Effective Date and Time (See page 17)

Upon approval of the merger and the merger agreement by our shareholders at
this meeting and by the shareholders of i360, and the satisfaction or waiver
(where permissible) of the other merger conditions, the merger will be
consummated and become effective at the time at which Articles of Merger meeting
the requirements of the General Corporation Law of Nevada and Articles of Merger
meeting the requirements of the Utah Business Corporation Act shall be filed
with both the Secretary of State of Nevada and the Secretary of State of Utah
for filing, whichever is later. We expect the merger to become effective
promptly after this meeting.

Other Terms of the Merger Agreement (See pages 17 to 20)

The merger agreement is attached to this proxy statement as Annex B. You
should read the merger agreement. It is the legal document that governs the
merger.

Our Board of Directors and Executive Officers

Promptly after the effective time, our board of directors will take all
necessary actions to increase the size of our board of directors by two
directors and elect William G. Cochrane (President and director of i360)
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<PAGE> 11

and S. Drexel Ridley (director of i360) to our board of directors. We have also
agreed to use our best reasonable efforts to ensure that one of these directors
is appointed to serve on the nominating committee. At the next annual meeting of
our shareholders, the directors of i360 immediately prior to the merger will
nominate one-third of the non-independent members of our board for election. Mr.
Cochrane will be appointed as a Senior Vice President of InfoCast and as
President of our i360 division.

Closing Conditions (See page 19)

The completion of the merger depends upon the satisfaction of a number of
conditions, including:

- the approval of the merger by the holders of a majority of the
outstanding shares of our common stock and by the holders of a majority
of the outstanding shares of i360's common stock;

- the absence of any order or legal restraint of any court or governmental
entity preventing or prohibiting the merger;

- the continued accuracy of each party's representations and warranties and
the fulfillment of each party's agreements contained in the merger
agreement;

- the receipt of all necessary consents;

- the absence of a material adverse change or effect with respect to
InfoCast or i360 which would give i360 or InfoCast the right to terminate
the merger agreement;

- the delivery by each of our counsel and i360's counsel of a legal
opinion; and

- execution and delivery by the parties of an executed registration rights
agreement, escrow agreement and shareholder designee agreement.

In addition, InfoCast's obligation to consummate the merger is conditioned
on the foregoing:

- shareholders representing no more than 8% of i360's outstanding common
stock dissenting from the merger; and

- no more than 35 of i360's shareholders not being accredited investors.

The obligation of i360 to consummate the merger is also subject to the
approval by our board of directors of the issuance of options for a total of
469,197 shares of our common stock at an exercise price of $4.00 per share to be
awarded to future employees of InfoCast's i360 division.

Other than the condition requiring shareholder approval, which is a legal
requirement, each party to the merger may waive any condition that is intended
for its benefit. If either i360 or the Company elects to waive a condition and
complete the merger, we will evaluate the facts and circumstances giving rise to
the waiver at that time. If we determine that these facts and circumstances are
material to shareholders, we will disclose this information in a supplement to
this proxy statement before the meeting and will re-solicit your proxy. EVEN IF
THE HOLDERS OF OUR COMMON STOCK APPROVE THE MERGER, THERE CAN BE NO ASSURANCE
THAT THE MERGER WILL BE CONSUMMATED.

Termination (See page 25)

Either party may terminate the merger agreement under a number of
circumstances, including the following material circumstances:

- any governmental authority has issued a final and non-appealable order,
decree or ruling permanently restraining, enjoining or otherwise
prohibiting the merger; or

- the merger has not been completed by August 15, 2000; or

- any of the conditions to such party's obligation to consummate the merger
has not been met or waived at such time as such condition can no longer
be satisfied.

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<PAGE> 12

Termination Fees and Expenses (See page 20)

Each party will pay for its own expenses in the event the merger agreement
is terminated.

Material Federal Income Tax Consequences (See page 12)

The merger is expected to be a tax-free reorganization within the meaning
of Section 368(a) of the Internal Revenue Code of 1986. Assuming the merger so
qualifies, no gain or loss will be recognized for federal income tax purposes by
holders of our common stock. DUE TO THE INDIVIDUAL NATURE OF TAX CONSEQUENCES,
YOU ARE URGED TO CONSULT YOUR TAX ADVISOR AS TO THE SPECIFIC TAX CONSEQUENCES TO
YOU OF THE MERGER, INCLUDING THE EFFECTS OF STATE, LOCAL OR OTHER TAX LAWS.

Regulatory Approvals (See page 20)

Neither we nor i360 is required to make filings with or obtain approvals
from regulatory authorities in connection with the merger, other than to file
Articles of Merger with the State Departments of Nevada and Utah.

Dissenters' Appraisal Rights (See page 20)

You may be entitled to appraisal rights in connection with the merger under
the provisions of Nevada law. Any shareholder who desires to exercise his or her
statutory dissenter's rights must, before the vote is taken, submit a written
demand for the payment of his or her shares to us. Shareholders who vote in
favor of the merger may not exercise dissenter's rights. FAILURE TO STRICTLY
COMPLY WITH THE REQUIREMENTS OF NEVADA LAW WILL RESULT IN THE LOSS OF APPRAISAL
RIGHTS.

Voting Agreement (See page 19)

Certain shareholders of i360, who held a total of approximately 67.4% of
the shares of i360's common stock outstanding on the record date, have entered
into a voting agreement with us. This agreement requires that, subject to the
terms and conditions of the agreement, each such shareholder will vote all
shares of i360's common stock owned by that shareholder in favor of the merger.

Deposit of Shares into Escrow (See page 17)

The merger agreement provides that we will withhold and deposit into escrow
750,000 shares of our common stock and/or warrants to purchase an aggregate of
750,000 shares of our common stock that would otherwise be issued to certain
i360 shareholders in the merger. These escrowed shares and warrants are intended
to reimburse us for potential obligations of indemnification to the i360
directors and for any losses we incur if i360 has breached any of its
representations and warranties under the merger agreement.

LOAN TO I360 BY INFOCAST

On June 22, 2000, InfoCast entered into agreements with i360 under which
InfoCast agreed to loan to i360 an aggregate amount of up to $2,000,000, secured
by all of the assets of i360. The Company's obligation to make loans under those
agreements terminates and all loans made thereunder mature upon consummation of
the merger or earlier termination of the merger agreement in accordance with its
terms. The loans bear interest at the prime rate plus 2% payable upon maturity
or earlier payment of the loans. If the merger is consummated, the outstanding
loans will be effectively terminated. If the merger agreement is terminated, all
loans are due and payable six months after such termination.

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<PAGE> 13

WHERE YOU CAN FIND MORE INFORMATION

We file annual, quarterly and current reports, proxy statements and other
information with the Securities and Exchange Commission (the "SEC"). You may
read and copy any document we file at the SEC's public reference room at the
following locations:

- Main Public Reference Room
450 Fifth Street, N.W.
Washington, D.C. 20549

- Regional Public Reference Room
75 Park Place, 14th Floor
New York, New York 10007

- Regional Public Reference Room
Northwestern Atrium Center
500 West Madison Street, Suite 1400
Chicago, Illinois 60661-2511

You may obtain information on the operation of the SEC's public reference
rooms by calling the SEC at (800) SEC-0330.

We are required to file these documents with the SEC electronically. You
can access the electronic versions of these filings on the Internet at the SEC's
web site, located at http://www.sec.gov.

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<PAGE> 14

QUESTIONS AND ANSWERS ABOUT THE MERGER

Q: WHAT WILL HAPPEN IN THE MERGER?

A: In the merger, i360 will be merged with and into us. Upon consummation of the
merger, all of i360's common stock will be converted into approximately
7,584,000 shares of InfoCast's common stock and all options to purchase
shares of i360's common stock will become warrants to purchase approximately
4,416,000 shares of InfoCast's common stock and employee options to purchase
approximately 1,030,803 shares of InfoCast's common stock.

Q: WHEN DO YOU EXPECT THE MERGER TO BE COMPLETED?

A: We are working to complete the merger during the third calendar quarter of
2000.

Q: WHAT ARE SHAREHOLDERS BEING ASKED TO VOTE UPON?

A: Shareholders are being asked to approve the merger of i360 with and into
InfoCast. The proposal to adopt and approve the merger with i360 must be
approved by the holders of a majority of the shares of our common stock
present in person or represented by a properly executed proxy at the special
meeting.

Q: HOW DOES THE BOARD OF DIRECTORS RECOMMEND THAT I VOTE?

A: Our board of directors has approved and adopted the merger and the merger
agreement and recommends that shareholders vote FOR approval of the merger
and the related transactions. The board of directors believes that the merger
is fair to, and in the best interests of, our shareholders.

Q: WHAT HAPPENS IF I TRANSFER MY SHARES AFTER THE RECORD DATE?

A: The record date for the special meeting is earlier than the expected date of
the merger. Therefore, transferors of shares of common stock after the record
date but prior to the merger will retain their right to vote at the special
meeting.

Q: WHAT DO I NEED TO DO NOW?

A: If you are a shareholder of InfoCast, simply indicate on your proxy card how
you want to vote and sign, date and mail it in the enclosed envelope as soon
as possible.

Q: WHAT HAPPENS IF I DON'T RETURN A PROXY CARD?

A: If you are a shareholder, the failure to return your proxy card will have the
same effect as voting against the merger and the related transactions.

Q: MAY I VOTE IN PERSON?

A: Yes. If you are a shareholder, you may attend the special meeting and vote
your shares in person, rather than signing and mailing a proxy card.

Q: MAY I CHANGE MY VOTE AFTER I HAVE SUBMITTED MY PROXY?

A: Yes. If you are a shareholder, you may change your vote at any time before
your proxy is voted at the special meeting by following the instructions as
detailed in "Special Meeting -- Proxies and Voting Rights" on page 9. Before
your proxy is voted, you may submit a new proxy or you may attend the special
meeting and vote in person.

Q: IF MY SHARES ARE HELD IN "STREET NAME" BY MY BROKER, WILL MY BROKER VOTE MY
SHARES FOR ME?

A: Your broker will vote your shares of common stock only if you provide
instructions on how to vote. You should instruct your broker how to vote your
shares, following the directions your broker provides. If you
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<PAGE> 15

do not provide instructions to your broker, your shares will not be voted and
they will be counted as votes against the merger and the related
transactions.

Q: WHO CAN HELP ANSWER MY QUESTIONS?

A: If you have additional questions about the merger or the related
transactions, you should contact:

Herve Seguin, Chief Financial Officer
InfoCast Corporation, 1 Richmond Street West, Suite 902
Toronto, Ontario M5H 3W4
(416) 867-1681

Q: WHAT IF I DON'T AGREE WITH THE MERGER?

A: You may be entitled to appraisal rights in connection with the merger under
the provisions of Nevada law. Any shareholder who desires to exercise his or
her statutory dissenter's rights must, before the vote is taken, submit a
written demand for the payment of his or her shares to us. Shareholders who
vote in favor of the merger may not exercise dissenters' rights. The
procedure for exercising your appraisal rights is detailed in "The Merger
Agreement -- Dissenters' Rights." If you don't follow the exact procedure,
you will lose this right.

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CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

Certain matters discussed in this Proxy Statement constitute
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. The forward-looking statements relate to
anticipated financial performance, management's plans and objectives for future
operations, business prospects, market conditions and other matters. The Private
Securities Litigation Reform Act of 1995 provides a safe harbor for
forward-looking statements in certain circumstances. The following discussion is
intended to identify the forward-looking statements and certain factors that
could cause future outcomes to differ materially from those set forth in the
forward-looking statements.

Forward-looking statements include the information concerning possible or
assumed future results of operations of InfoCast Corporation, as the combined
company, and other future events set forth under "Summary -- Closing
Conditions," "Questions and Answers About The Merger," "The Merger -- Opinion of
Houlihan Lokey Howard & Zukin," "The Merger -- Reasons for the Merger; Factors
Considered by the Company Board," "The Merger -- Recommendation of the Company
Board," and other statements in this Proxy Statement identified by words such as
"anticipate," "estimate," "expect," "intend," "believe," and "objective."

Readers are cautioned not to place undue reliance on such forward-looking
statements, which involve known and unknown risks, uncertainties and other
factors that may cause the actual results, performance or achievements of the
Company to be materially different from any future results, performance or
achievements expressed or implied by such forward-looking statements. Such
factors may affect the Company's operations, markets, products, services and
prices. In addition to any assumptions and other factors referred to
specifically in connection with such forward-looking statements, factors that
could cause the Company's actual results to differ materially from those
contemplated in any forward-looking statement include, among others, the
following: general economic and business conditions; changes in technology;
changes in political, social and economic conditions; regulatory matters;
integration of the operations of the Company and i360; the actual costs required
to effect the Merger; the loss of any significant customers; changes in business
strategy or development plans; the speed and degree to which competition enters
the Company's industry; changes in the capital markets affecting the ability to
finance capital requirements and the factors listed in the other reports
previously or hereafter filed with the SEC. Other factors and assumptions not
identified above were also involved in the derivation of these forward-looking
statements, and the failure of such other assumptions to be realized, as well as
other factors, may also cause actual results to differ materially from those
projected. The Company assumes no obligation to update such forward-looking
statements to reflect actual results, changes in assumptions or changes in other
factors affecting such forward-looking statements.

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<PAGE> 17

SPECIAL MEETING

DATE, TIME, PLACE AND PURPOSE

The Meeting will be held on August 14, 2000 at 10:00 a.m., local time, at
the offices of Olshan Grundman Frome Rosenzweig & Wolosky LLP, 505 Park Avenue,
New York, New York 10022 or at any postponement or adjournment thereof, to
consider and vote upon the Merger Proposal and the 2000 Plan.

RECORD DATE, VOTING SECURITIES AND QUORUM

The voting securities of the Company outstanding on July 5, 2000 consisted
of 21,423,174 shares of Company Common Stock, entitling the holders thereof to
one vote per share. Only shareholders of record as of that date are entitled to
notice of and to vote at the Meeting or any postponement or adjournment thereof.
A majority of the voting power of outstanding shares of Company Common Stock
present in person or by proxy is required for a quorum.

RECOMMENDATIONS OF THE BOARD OF DIRECTORS

The Company Board believes that the Merger and the 2000 Plan are in the
best interests of the Company and the Company's shareholders and recommends that
the Company's shareholders vote FOR the Merger Proposal and FOR approval of the
adoption of the 2000 Plan.

PROXIES AND VOTING RIGHTS

Shares of Company Common Stock represented by Proxies, in the accompanying
form of Proxy, which are properly executed, duly returned and not revoked, will
be voted in accordance with the instructions contained therein. If no
specification is indicated on the Proxy, the shares represented thereby will be
voted (i) FOR the Merger Proposal, (ii) FOR approval of the adoption of the 2000
Plan and (iii) in the Proxy holders' discretion as to other matters that may
properly come before the Meeting.

The execution of a Proxy will in no way affect a shareholder's right to
attend the Meeting and vote in person. Any Proxy executed and returned by a
shareholder may be revoked at any time thereafter if written notice of
revocation is given to the Secretary of the Company prior to the vote to be
taken at the Meeting or by execution of a subsequent Proxy which is presented at
the Meeting, or if the shareholder attends the Meeting and votes by ballot,
except as to any matter or matters upon which a vote shall have been cast
pursuant to the authority conferred by such Proxy prior to such revocation.
Broker "non-votes" and the shares of Company Common Stock as to which a
shareholder abstains are included for purposes of determining the presence or
absence of a quorum for the transaction of business at the Meeting. A broker
"non-vote" occurs when a nominee holding shares for a beneficial owner does not
vote on a particular proposal because the nominee does not have discretionary
voting power with respect to that item and has not received instructions from
the beneficial owner. Broker "non-votes" and abstentions are not counted for
purposes of determining whether a proposal has been approved and, therefore,
will count as a vote against the Merger Proposal. Broker "non-votes" and
abstentions will not have the effect of votes in opposition in such tabulations
relating to the proposal to approve the 2000 Plan or any other proposal.

VOTE REQUIRED

In accordance with the Nevada General Corporation Law (the "NGCL") and the
Bylaws of the Company, the presence, in person or by proxy, of the holders of a
majority of the outstanding shares of Company Common Stock entitled to vote is
necessary to constitute a quorum to transact business at the Meeting.
Abstentions (and broker non-votes) are counted for purposes of determining the
presence or absence of a quorum for the transaction of business. Assuming the
presence of a quorum, the affirmative vote of the holders on the Record Date of
a majority of the outstanding voting power of Company Common Stock is necessary
for the approval of the Merger Proposal and the affirmative vote of the holders
of a majority of the

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<PAGE> 18

shares of Company Common Stock present and voting, in person or by proxy, at the
Meeting is necessary for approval of the adoption of the 2000 Plan. If a quorum
is not present or represented at the Meeting, the shareholders entitled to vote
thereat, present in person or represented by proxy, have the power to adjourn
the Meeting from time to time, without notice other than the announcement at the
meeting, until a quorum is present or represented. At any such adjournment
Meeting at which a quorum is present or represented, any business may be
transacted at the Meeting as originally notified.

Approval of the Merger Proposal by the holders of Company Common Stock is a
condition to the consummation of the Merger.

SOLICITATION OF PROXIES

All expenses in connection with this solicitation will be borne by the
Company. It is expected that solicitations will be made primarily by mail, but
officers, directors, employees or representatives of the Company may also
solicit Proxies by telephone, telegraph or in person, without additional
compensation. The Company will, upon request, reimburse brokerage houses and
persons holding shares in the names of their nominees for their reasonable
expenses in sending solicitation material to their principals.

PROPOSAL NO. 1

THE MERGER

Following the Merger, the business and operations of the reorganized
Company will be substantially similar to those of the Company before the
acquisition of i360.

BACKGROUND OF THE MERGER

The terms and conditions of the merger were determined through arm's length
negotiations between the senior managements of InfoCast and i360. In determining
the form of the transaction and the form and amount of the consideration, a
number of factors were reviewed by the senior management of InfoCast. For a
description of these factors see "Reasons for the Merger; Factors Considered by
the Company Board." The following is a brief discussion of the contacts and
negotiations between InfoCast and i360 leading up to the signing of the Merger
Agreement.

In October 1999, Mr. Don Jeffrey, a shareholder of InfoCast, identified
i360 as a potential customer for InfoCast's hosting operations and approached
InfoCast's President to assign management resources to explore this opportunity.
During November and December 1999, there were several meetings between InfoCast
and i360 management in Tucson, Philadelphia and Toronto to understand each
company's business model and explore ways in which InfoCast could provide
support to i360's business plan. During this period, it was apparent to
InfoCast's management that i360 was experiencing management upheaval and
required additional funding to meet its immediate obligations and execute its
business plan.

The discussions between InfoCast and i360 culminated in the execution of a
memorandum of understanding dated January 14, 2000 between InfoCast and i360
referred to as the "Teaming Agreement." The Teaming Agreement called for a joint
InfoCast/i360 sales and marketing effort aimed at identified affinity groups.
Each of the parties was to provide its products and services (InfoCast -
hosting, call center, eLearning; i360 -- custom portals) at "most-favored
nation" pricing, and net profits were to be shared on a 67%/33% basis in favor
of the party who identified the customer. In February 2000, the two companies
started working on i360's customer, Britt Worldwide, as well as several other
identified potential customers on that basis.

In February 2000, i360 completed its management and Board transition and
commenced discussions with third parties to invest in i360.

By early February 2000, it became evident to InfoCast's senior management
and its then financial advisor, N.M. Rothschild & Sons ("Rothschild") that the
Teaming Agreement with i360 would represent a significant percentage of
InfoCast's future revenue and thus impact InfoCast's financial forecasts.
Accord-

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<PAGE> 19

ingly, on February 8, 2000 a "due diligence" meeting to review i360's business
plan was held in Tucson among i360 management, InfoCast management and
Rothschild. Following that meeting, InfoCast management determined that an
acquisition of i360 by InfoCast could create value for InfoCast's shareholders.
As a guideline to valuing i360, InfoCast used publicly available information
regarding the trading values of companies in the Internet Service Provider
industry. From February 12 to February 15, 2000, Mr. Tom Griffis, Co-Chairman of
InfoCast, held exploratory telephone meetings with i360's management and
potential new investors in i360 to gauge their interest in a merger of InfoCast
and i360.

On February 16 and 17, 2000 a management team from InfoCast visited Tucson
to conduct additional due diligence and to negotiate a possible merger. These
discussions culminated in a letter agreement dated February 17, 2000 between
InfoCast, i360 and certain shareholders of i360 whereby InfoCast would acquire
i360. The signing of the letter agreement was publicly announced on February 23,
2000. The proposed merger was subject to a number of conditions, including the
negotiation of a definitive merger agreement, the approval of the InfoCast Board
and i360 raising additional equity capital to fund its operations until
mid-2000.

On March 8 and March 10, 2000, i360 consummated additional financings,
aggregating $3.5 million.

On April 12 and 13, 2000, Mr. Leech visited Tucson to complete the
negotiation of the definitive merger agreement and on May 2, 2000, the Board of
Directors of InfoCast and i360 approved the execution of the Merger Agreement.
The Merger Agreement was signed by the Companies on May 3, 2000.

In connection with its approval of the Merger Agreement, the Company's
Board of Directors determined to seek an opinion from an investment banking firm
as to the fairness of the transaction to InfoCast from a financial point of
view. On May 31, 2000, the InfoCast Board of Directors engaged the firm of
Houlihan Lokey Howard & Zukin to review the transaction and issue their opinion
as to the fairness of the consideration to be paid by the Company in connection
with the merger from a financial point of view. On June 14, 2000, Houlihan Lokey
delivered to the Company's Board of Directors its letter dated June 13, 2000
that, in its opinion, the consideration to be paid by the Company in connection
with the Merger is fair to the Company from a financial point of view.

RECOMMENDATION OF THE COMPANY BOARD

The Company Board has approved the Merger Agreement and the transactions
contemplated thereby, and has determined that the Merger is fair to and in the
best interests of the Company and the Company's shareholders.

THE COMPANY BOARD RECOMMENDS THAT THE HOLDERS OF THE COMPANY'S COMMON STOCK
VOTE "FOR" THE ADOPTION AND APPROVAL OF THE MERGER AGREEMENT AND THE MERGER.

REASONS FOR THE MERGER; FACTORS CONSIDERED BY THE COMPANY BOARD

In approving the Merger Agreement and the Merger, the Company Board
considered a variety of factors, including:

1. The financial condition, results of operations, cash flows,
business opportunities, current strategies, business plans, competitive
position, and prospects of i360, and current economic and market conditions
in the Internet and e-commerce industries.

2. The Company's strategic plan and the Company Board's belief that
the Company's ability to pursue the plan would be enhanced by the Merger.

3. The arms-length negotiations between representatives of the Company
and i360 with respect to the consideration and other terms of the Merger,
and the InfoCast Board's belief that the terms of the Merger Agreement,
including the Merger Consideration and the exchange ratio, represents the
most favorable terms that could be negotiated with i360.

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<PAGE> 20

4. The customer base that i360 is developing provides a significant
market opportunity for InfoCast's e-learning products and potentially the
InfoCast call center product.

5. The i360 customer base represents an opportunity for InfoCast to
generate additional hosting revenue by more quickly employing the
unutilized capacity within its data centers with no significant operating
cost increase.

6. The i360 business model potentially provides fast revenue
generation in the short term which will potentially shorten the time until
InfoCast's operations are cash flow positive.

The Company Board also considered a variety of potentially negative factors
relating to the Merger, including (i) the dilutive effect of issuance of Company
Common Stock warrants and options to purchase Company Common Stock to the i360
stockholders and option holders, (ii) the uncertainty of i360's development and
the fact that i360 has limited historical operations, (iii) the transaction
costs and (iv) the risks that the anticipated benefits of the Merger might not
be obtained.

The foregoing discussion of the information and factors considered by the
Company Board is not intended to be exhaustive, but includes the material
factors considered by the Company Board. In view of the variety of factors
considered in connection with its evaluation of the Merger, the Company Board
did not find it practicable to, and did not, quantify or otherwise assign
relative weights to the specific factors considered in reaching its
determination and recommendation. Individual directors may have given differing
weights to different factors.

OPINION OF HOULIHAN LOKEY HOWARD & ZUKIN

InfoCast engaged Houlihan Lokey Howard & Zukin Financial Advisors, Inc.
("Houlihan Lokey") to render an opinion (the "Opinion") as to the fairness, from
a financial point of view, to InfoCast of the consideration to be paid by
InfoCast to the shareholders and optionholders of i360, based on the exchange
ratio specified in the Merger Agreement (the "Merger Consideration"). Houlihan
Lokey is a nationally recognized investment banking firm that provides financial
advisory services in connection with mergers and acquisitions, leveraged
buyouts, business valuations for a variety of regulatory and planning purposes,
recapitalizations, financial restructurings and private placements of debt and
equity securities.

THE FULL TEXT OF HOULIHAN LOKEY'S OPINION DATED JUNE 13, 2000, WHICH SETS
FORTH, AMONG OTHER THINGS, THE ASSUMPTIONS MADE, GENERAL PROCEDURES FOLLOWED,
MATTERS CONSIDERED AND LIMITATIONS ON THE REVIEW UNDERTAKEN BY HOULIHAN LOKEY IN
RENDERING THE OPINION IS ATTACHED AS ANNEX A TO THIS PROXY STATEMENT AND IS
INCORPORATED HEREIN BY REFERENCE. WE URGE YOU TO READ THE OPINION CAREFULLY AND
IN ITS ENTIRETY. THIS SUMMARY OF THE OPINION IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO THE FULL TEXT OF HOULIHAN LOKEY'S OPINION. THE OPINION ADDRESSES
ONLY THE FAIRNESS TO INFOCAST OF THE MERGER CONSIDERATION AND DOES NOT
CONSTITUTE A RECOMMENDATION TO ANY SHAREHOLDER AS TO HOW TO VOTE AT THE
SHAREHOLDER MEETING.

Houlihan Lokey relied upon the assurances of both InfoCast and i360 that
all of the information provided by InfoCast and i360, including the financial
projections and pro-forma financial statements and adjustments provided to
Houlihan Lokey, were reasonably prepared reflecting the best currently available
estimates and good faith judgments of InfoCast and i360, that it was reasonable
to rely upon such information and that there have been no material changes in
the information reviewed, or in the assets, financial condition, business or
prospects of InfoCast or i360, between the date the information was provided and
the date of the Opinion. Houlihan Lokey did not independently verify the
accuracy or completeness of the financial information supplied to it with
respect to InfoCast or i360 and does not assume responsibility for the accuracy
or completeness of such information. InfoCast also informed Houlihan Lokey, and
Houlihan Lokey has assumed, without independent verification, that the merger
will be treated as a tax-free reorganization for federal income tax purposes.
Additionally, Houlihan Lokey relied without independent verification upon the
accuracy and completeness of all accounting, legal, tax, operational, historical
and other information reviewed by it for purposes of the Opinion. Houlihan Lokey
did not make and did not assume responsibility for making any independent
valuation or appraisal of the assets or liabilities of InfoCast or i360, nor was
Houlihan Lokey furnished with any appraisals of those assets and liabilities.

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<PAGE> 21

Houlihan Lokey did not, and was not requested by InfoCast to, make any
recommendations as to the form or amount of consideration to be paid by
InfoCast, the public market values or realizable value of InfoCast's Common
Stock given as consideration in the Merger or the prices at which InfoCast's
Common Stock may trade in the future following the Merger, and does not express
any opinion as to the fairness of any aspect of the Merger not expressly
addressed in the Opinion.

Houlihan Lokey's opinion was necessarily based on the information made
available to it, and financial, stock market, and other conditions and
circumstances existing and disclosed to Houlihan Lokey as of the date of the
Opinion.

In arriving at its opinion, Houlihan Lokey, among other things, (i) held
discussions separately with certain members of the senior management and other
representatives of InfoCast and i360 regarding the operations, financial
condition, future prospects and projected operations and performance of
InfoCast, i360 and the combined company; (ii) reviewed InfoCast's audited
financial statements for the period from July 29, 1997 (inception) to December
31, 1997, the fiscal year ended December 31, 1998 and the three month period
ended March 31, 1999, unaudited financial statements for the three month period
ended March 31, 2000 and draft audited financial statements for the fiscal year
ended March 31, 2000, which InfoCast management has identified as being the most
current financial statements available; (iii) reviewed i360's audited financial
statements for the period July 14, 1999 (inception) through December 31, 1999
and unaudited interim financial statements for the three month period ended
March 31, 2000, which i360's management has identified as being the most current
financial statements available; (iv) reviewed the analyst report for InfoCast,
reflecting the proposed Merger, prepared by SmallCaps Online LLC, as of May 25,
2000; (v) reviewed projections prepared by i360's management with respect to
i360 for the three fiscal years ending March 31, 2002; (vi) reviewed pro-forma
projections prepared by InfoCast's management with respect to the combined
company for the two fiscal years ending March 31, 2002; (vii) visited i360's
headquarters in Tucson, Arizona; (viii) reviewed an executed copy of the
Agreement and Plan of Merger by and between InfoCast Corporation and i360 inc.,
dated May 3, 2000; (ix) reviewed copies of various documents, including InfoCast
Business Plan, dated 2000; i360 inc. Strategic Business Plan, dated January
2000; i360 inc. Executive Summary, dated January 2000; and i360 inc. Company
Summary, dated April 2000; (x) analyzed historical stock performance and trading
volume of InfoCast's common stock; (xi) reviewed certain other publicly
available financial data for certain companies that Houlihan Lokey deemed
comparable to InfoCast and i360; (xii) reviewed various industry and research
reports for the companies' respective industries; and (xiii) conducted such
other studies, analyses and inquiries Houlihan Lokey deemed appropriate.

As discussed below, Houlihan Lokey used various methodologies to assess the
fairness, from a financial point of view, to InfoCast of the Merger
Consideration.

MATERIAL FINANCIAL ANALYSES REGARDING I360

The primary methodologies utilized by Houlihan Lokey in analyzing i360 were
the Market Multiple approach and the Discounted Cash Flow approach. The Market
Multiple approach considers the trading multiples for certain revenue, gross
profit and subscribers of a peer group of companies. Based on a comparative
financial analysis of i360 and the peer group of companies, an appropriate
multiple was selected and applied to projected revenues, gross profit and
subscribers of i360. In this analysis, Houlihan Lokey analyzed the trading
statistics of (i) Internet Service Providers ("ISPs"), such as Earthlink
Network, Covad Communications, DSL.net, Internet America, OneMain.com, PSInet
and Prodigy Communications, and (ii) Business-to-Business vertical market
companies such as Ariba, Inc., Commerce One, Inc., Espeed, Inc., FreeMarkets,
Inc., Neoforma.com, Inc., PurchasePro.com, SciQuest.com, Inc., Ventro Corp.
(Chemdex) and VerticalNet. The Discounted Cash Flow analysis considered the
projected income stream of i360, as provided by InfoCast's management, and then
discounted that stream to the present using a market based, risk adjusted
discount rate. i360's terminal value, which represents the on-going value of the
entity past the time frame of the projected income stream, was determined by
utilizing the Gordon Growth model.

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PRO FORMA ACCRETION ANALYSIS

In addition to the financial analysis of i360 described above, Houlihan
Lokey performed a similar financial analysis of InfoCast on a pro-forma basis
reflecting the Merger. This pro-forma financial analysis consisted of a
Discounted Cash Flow approach, as described above, using the projected
performance of the combined entities, as projected by InfoCast's management as
the basis for the valuation. Houlihan Lokey also considered a Comparative Market
Multiple approach, which considers the trading multiples for certain revenues of
a peer group of companies. Based on a comparative financial analysis of InfoCast
and the peer group of companies, an appropriate multiple was selected and
applied to the projected revenues of InfoCast. In the comparable company
analysis, Houlihan Lokey analyzed the trading statistics of Application Service
Providers, such as Breakaway Solutions, Inc., Citrix Systems, Inc., Concentric
Network Corp., Exodus Comm., Inc., FutureLink Dist. Corp., Interliant, Inc.,
NaviSite, Inc., and Usinternetworking, Inc.

Houlihan Lokey also considered a Public Trading Price Value analysis of
InfoCast's Common Stock. The Common Stock price of InfoCast was $7.625 as of
February 22, 2000, the day prior to any public announcements regarding the
proposed Merger, and was $3.938 per share as of June 13, 2000, the date of
Houlihan Lokey's opinion. However, given that (i) InfoCast Common Stock is
generally traded in volumes lower than the comparable public companies; (ii)
there is limited investment analyst coverage for InfoCast; and (iii) there are
no material institutional shareholders of InfoCast, Houlihan Lokey did not rely
solely upon the public valuation of InfoCast.

FAIRNESS OF CONSIDERATION

On June 14, 2000, Houlihan Lokey delivered its written opinion to
InfoCast's Board of Directors to the effect that as of the date of such Opinion,
and based upon the various qualifications and assumptions made, general
procedures followed, factors considered and limitations on the review undertaken
as set forth below and in such Opinion, the Merger Consideration is fair, from a
financial point of view, to InfoCast.

GENERAL

The preparation of a fairness opinion is a complex analytical process
involving various determinations as to the most appropriate and relevant methods
of financial analysis and application of those methods to the particular
circumstances and is therefore not readily susceptible to summary description.
In arriving at its opinion, Houlihan Lokey has advised InfoCast's Board of
Directors that it did not attribute any particular weight to any analysis or
factor considered by it, but rather made the qualitative judgements as to the
significance and relevance of each analysis and factor. Accordingly, Houlihan
Lokey believes that its analyses and the summary set forth herein must be
considered as a whole and that selecting portions of its analyses, without
considering all analyses, or portions of this summary, without considering all
factors and analyses, could create an incomplete view of the processes
underlying the analyses undertaken by it in connection with the Opinion. No
company used in the analyses performed by Houlihan Lokey as a comparison is
identical to InfoCast or i360.

Houlihan Lokey has advised InfoCast's Board of Directors that in its
analyses, Houlihan Lokey made numerous assumptions with respect to InfoCast's
and i360's industry performance, general business, economic, market and
financial conditions and other matters, many of which are beyond InfoCast's and
i360's control. In addition, Houlihan Lokey may have given various analyses more
or less weight than other analyses, and may have deemed various assumptions more
or less probable than other assumptions. The estimates contained in such
analyses are not necessarily indicative of actual values or predictive of future
results or values, which may be more or less favorable than suggested by such
analyses. Additionally, analyses relating to the value of businesses or
securities are not appraisals. Accordingly, such analyses and estimates are
inherently subject to substantial uncertainty.

InfoCast agreed to pay Houlihan Lokey a fee of $100,000, plus reasonable
out-of-pocket expenses incurred by Houlihan Lokey, for its preparation and
delivery of the Opinion. No portion of Houlihan Lokey's fee is contingent upon
the successful completion of the Merger or the conclusions reached in the
Opinion. InfoCast retained Houlihan Lokey solely to deliver the Opinion.
InfoCast agreed to indemnify Houlihan
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<PAGE> 23

Lokey and its affiliates against certain liabilities, including liabilities
under federal securities laws that arise out of the engagement of Houlihan
Lokey. No limitations were imposed by InfoCast upon Houlihan Lokey with respect
to the investigations made or the procedures followed by it in rendering the
Opinion. Houlihan Lokey was not requested to, and did not, solicit third party
indications of interest in acquiring all or any part of InfoCast.

FEDERAL INCOME TAX CONSIDERATIONS

No gain or loss will be recognized by the Company or i360 or by the
Company's shareholders, as a result of the Merger, except with respect to those
shareholders who exercise dissenter's rights. Shareholders who exercise
dissenter's rights should consult with their own tax advisors as to the tax
consequences of the exercise of such dissenter's rights.

DILUTION

After the Merger, the present i360 shareholders will own approximately
26.2% of the Company's Common Stock (37.8% taking into consideration the effect
of outstanding options to purchase shares of i360 Common Stock which will be
converted into options and warrants to purchase shares of Company Common Stock
after the Merger).

MANAGEMENT AFTER THE MERGER

Directors

On the Record Date, the directors of the Company were Darcy Galvon, A.
Thomas Griffis, James Leech, Michael Sheehan, Glen Allmendinger, George Shafran
and Jeffrey S. Spindler. Upon consummation of the Merger, each of the current
directors will remain on the Company Board. Pursuant to the Merger Agreement,
i360 has designated William G. Cochrane and S. Drexel Ridley (the "Director
Appointees") to serve on the Board. The Company has agreed to increase the size
of the Company Board and to appoint Messrs. Cochrane and Ridley to the Board, to
serve until the next annual meeting of the Company's shareholders. The Company
has also agreed to use its best reasonable efforts to ensure that one of these
directors is appointed to serve on the nominating committee. At the next annual
meeting of the Company's shareholders, the current directors of i360 will
nominate one-third of the non-independent members of the Company Board for
election.

i360 has advised the Company that each of the Director Appointees has
consented to serve on the Company Board and that, to the best of its knowledge,
none of the Director Appointees (i) has a family relationship with any of the
directors or executive officers of the Company, (ii) beneficially owns any
securities (or rights to acquire securities) of the Company or (iii) has been
involved in any transactions, or has any business relationships with the Company
or any of its directors, executive officers or affiliates, of the type required
to be disclosed pursuant to Rule 14f-1 under the Exchange Act. The information
contained herein concerning i360 and its directors has been furnished by i360.
The Company assumes no responsibility for the accuracy or completeness of such
information.

The name, present principal occupation or employment and five-year
employment history of each Director Appointee and certain other information is
set forth below. Unless otherwise indicated, each occupation set forth opposite
an individual's name refers to employment with i360. Except as noted, none of
the persons listed below owns any shares of Company Common Stock or has engaged
in any transactions with respect to shares of Company Common Stock during the
past 60 days. During the last five years, neither i360, nor any Director
Appointee has been convicted in a criminal proceeding (excluding traffic
violations or similar misdemeanors) nor was such person a party to a civil
proceeding of a judicial or administrative body of competent jurisdiction, and
as a result of such proceeding was or is subject to a judgment, decree or final
order enjoining future violations of, or prohibiting activities subject to,
federal or state securities laws or finding any violation of such laws. Unless
otherwise indicated, all Director Appointees listed below are citizens of the
United States.

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<PAGE> 24

William G. Cochrane served as the President, Chief Executive Officer and
Chairman of i360 since July 1999. From 1988 to 1997, Mr. Cochrane held a variety
of executive positions at Motorola Incorporated, most recently as National Sales
Manager. From 1997 to 1998, Mr. Cochrane was Vice President of Sales at Paxar
Corporation. Mr. Cochrane also held positions with 3M (Minnesota Mining and
Manufacturing Corporation) and managed a private consulting firm. Mr. Cochrane
holds a B.A. in Health Administration & Education from Eastern Illinois
University.

Stephen D. Ridley served as General Counsel and a director of i360 since
November 1999. From 1980 to 1998, Mr. Ridley was General Counsel and a Director
of Industrial Relations for the Louisiana Association of Business and Industry.
He served as Finance Director for Reagan for President in 1980 for the First
Congressional District of Louisiana and acted as Labor Law Advisor to Governor
David Treen of Louisiana from 1980 to 1984. Mr. Ridley holds a B.S. in
Production Management from the University of New Orleans and a J.D. from
Louisiana State University. Mr. Ridley is also a director of Imark Corporation.

Executive Officers

The Merger Agreement provides that Mr. Cochrane will be named as a Senior
Vice President of the Company and as President of the Company's new i360
division. For a description of the terms of Mr. Cochrane's employment, see
"Employment Agreements" below.

VOTE REQUIRED

Approval of this proposal requires the affirmative vote of at least a
majority of the outstanding voting power of Company Common Stock.

INDEMNIFICATION

The Company has agreed that it will, following the Effective Time,
indemnify and exculpate the current directors of i360 against all losses,
expenses, claims, damages, or liabilities arising out of actions or omissions
occurring at or prior to the Effective Time to the fullest extent permitted
under Nevada law and by the Articles of Incorporation and the Bylaws of i360 as
in effect on the date of the Merger Agreement, including provisions relating to
advances of expenses incurred in defense of any litigation.

EMPLOYMENT AGREEMENTS

William G. Cochrane is currently employed by i360 as its President, Chief
Executive Officer and Chairman of its Board of Directors at an annual salary of
$240,000 plus an annual bonus to be determined by i360's Board, but which shall
not be less than $120,000 during the first year. He is also the beneficial owner
of 2,000,000 shares of i360 Common Stock, 6,250,000 options to purchase i360
common stock at an exercise price of $0.10 per share and 423,000 options to
purchase i360 common stock at an exercise price of $1.33 per share. Following
the Merger, Mr. Cochrane will be employed by the Company as a Senior Vice
President of the Company and as President of the Company's i360 division
pursuant to the terms of his existing employment agreement. Mr. Cochrane will
continue to receive certain benefits, including participation in the Company's
employee benefit plans. Mr. Cochrane has waived his rights under his initial
i360 employment agreement to receive a severance payment from i360 in connection
with the Merger.

THE MERGER AGREEMENT

The following summary of the Merger Agreement is not complete and is
qualified in its entirety by reference to the provisions of the Merger Agreement
which is annexed to this Proxy Statement as Annex B.

TERMS OF THE MERGER; MERGER CONSIDERATION

The Company and i360 have entered into the Merger Agreement, which provides
that i360 will be merged with and into the Company with the Company surviving
the Merger. i360's shareholders will receive an aggregate of approximately
7,584,000 shares of Company Common Stock (subject to adjustment) and
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<PAGE> 25

warrants and options to purchase approximately 5,446,803 shares of Company
Common Stock in consideration for the Merger. In addition, the Company has
agreed to issue options to purchase 469,197 additional shares of Company Common
Stock to future employees of the Company's i360 division.

The Company is presently authorized to issue up to 100,000,000 shares of
Company Common Stock. The holders of Company Common Stock are entitled to one
vote for each share held of record on each matter submitted to a vote of
stockholders. There is no cumulative voting for election of directors. Subject
to the prior rights of any series of preferred stock which may from time to time
be outstanding, holders of Company Common Stock are entitled to receive ratably
such dividends as may be declared by the Company Board out of funds legally
available therefor, and, upon the liquidation, dissolution or winding up of the
Company, are entitled to share ratably in all assets remaining after payment of
liabilities and payment of accrued dividends and liquidation preference on the
preferred stock, if any. Holders of Company Common Stock have no preemptive
rights and have no rights to convert their Company Common Stock into any other
securities.

EFFECTIVE TIME OF THE MERGER

The Merger will become effective when the Articles of Merger are filed with
the Secretaries of State of the States of Nevada and Utah, in accordance with
Nevada and Utah law, respectively. It is anticipated that, if the Merger is
approved at the Meeting and all other conditions to the Merger have been
fulfilled or waived, the Articles of Merger will be filed on or about August 16,
2000 (the "Effective Time").

MANNER AND BASIS OF CONVERTING SHARES

As of the Effective Time of the Merger, each issued and outstanding share
of i360 Common Stock will be converted into the right to receive 0.30 shares of
Company Common Stock (the "Exchange Ratio").

As of the date of this Proxy Statement, there were outstanding options to
purchase 14,720,000 shares of i360 Common Stock at an exercise price of $0.10
per share (the "$0.10 Options") and options to purchase 3,436,010 shares of i360
Common Stock at an exercise price of $1.33 per share (the "$1.33 Options" and,
together with the $0.10 Options, the "i360 Options"). All outstanding and
unexercised i360 Options will be assumed by the Company upon consummation of the
Merger. The i360 Options shall convert into (i) warrants to purchase 4,416,000
shares of Company Common Stock at an exercise price equal to $0.30 per share for
the $0.10 Options and (ii) options to purchase 1,030,803 shares of Company
Common Stock at an exercise price equal to $4.00 per share for the $1.33
Options. All other terms of the i360 Options assumed by the Company will remain
the same.

No fractional shares of Company Common Stock will be issued in connection
with the Merger. In lieu of fractional shares, each shareholder who would
otherwise be entitled to a fractional share will instead receive cash equal to
the value of such fractional interest based on the Closing Price of Company
Common Stock at the Closing Date of the Merger. As of the Record Date, there
were 21,423,174 shares of Company Common Stock and 25,280,000 shares of i360
Common Stock outstanding. Based upon the number of outstanding shares of Company
Common Stock and i360 Common Stock as of the Record Date, 29,007,174 shares of
Company Common Stock will be outstanding as of the Effective Time of the Merger
Agreement, of which approximately 7,584,000 shares (26.15% of the total) will be
issued or reserved for issuance to the former holders of i360 Common Stock.

ESCROW OF SHARES

Effective at the Effective Time, the Company and certain of the current
shareholders of i360 will enter into an Escrow Agreement (the "Escrow
Agreement"), pursuant to which 750,000 shares of Company Common Stock and/or
warrants to purchase Company Common Stock otherwise issuable to such
shareholders pursuant to the Merger Agreement will be held in escrow to
reimburse the Company for claims it is compelled to pay in respect of any
indemnification of the current i360 directors or any losses incurred by the
Company as a result of any breach by i360 of its representations and warranties
under the Merger Agreement.

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EXCHANGE OF CERTIFICATES

Promptly after the Effective Time of the Merger, the Company will arrange
for the holders of certificates of i360 Common Stock to receive in exchange
therefor certificates evidencing the number of shares of Company Common Stock
that such holders of i360 Common Stock are entitled based on the applicable
Exchange Ratio. Until an i360 stock certificate has been surrendered to the
Company, each such certificate shall be deemed at any time after the Effective
Time of the Merger to represent the right to receive, upon such surrender,
certificates for such number of shares of Company Common Stock and such cash
payment in lieu of fractional shares as the shareholder is entitled to under the
Merger Agreement.

REPRESENTATIONS AND WARRANTIES

In the Merger Agreement, i360 has made various representations and
warranties (subject in some cases to materiality and knowledge qualifiers)
relating to, among other things, i360's business and financial condition, i360's
requisite corporate authority to enter into and perform its obligations under
the Merger Agreement, the absence of a breach or violation of or default under
i360's charter or bylaws or internal rules as a result of the consummation of
the Merger, the capitalization of i360, that upon the transfer in connection
with the Merger of the issued and outstanding capital stock of i360 such shares
will be duly authorized, validly issued, fully paid and nonassessable, the
assets and liabilities of i360, the accuracy of i360's tax returns and other
filings with applicable taxing authorities, the satisfaction of certain legal
requirements, including the receipt of all governmental, regulatory and other
necessary consents or waivers for the Merger, the absence of litigation and the
absence of certain changes in i360's business having a material adverse affect
on i360's business.

The Company has made various representations and warranties (subject in
some cases to materiality and knowledge qualifiers) relating to, among other
things, its business, its requisite corporate authority to enter into and
perform its obligations under the Merger Agreement, the absence of a breach or
violation of or default under its charter or bylaws or internal rules or
regulations governing conduct of corporate actions as a result of the
consummation of the Merger, the accuracy and timeliness of its various filings
with the Securities and Exchange Commission ("SEC") (except as otherwise
disclosed to the i360 shareholders), the Company's business and financial
condition, the capitalization of the Company, the accuracy of the Company's tax
returns and other filings with applicable taxing authorities, the satisfaction
of certain legal requirements, including the receipt of all governmental,
regulatory and other necessary consents or waivers for the Merger, the accuracy
of the Company's financial statements delivered to i360 or contained in the
Company's filings with the SEC, the absence of litigation (except as disclosed
to the i360 shareholders) and the absence of certain changes in the Company's
business having a material adverse affect on the Company's business. In
addition, the Company has made representations and warranties that, upon
issuance pursuant to the terms of the Merger Agreement, the Company Common Stock
will be duly authorized, validly issued, fully paid and nonassessable.

All representations, warranties, covenants and agreements of the Company,
i360 and the i360 shareholders expire at the Effective Time, other than
covenants and agreements that by their terms contemplate performance after the
Effective Time.

CONDUCT OF BUSINESS PRIOR TO CLOSING

Pursuant to the Merger Agreement, i360 has agreed that, prior to the
Closing Date, it shall conduct its business in the ordinary course consistent
with past practice and, except as permitted by the Merger Agreement, shall not
alter its capital structure, increase its capitalization, or otherwise alter its
business operations.

ACQUISITION PROPOSALS

In the Merger Agreement, i360 agreed that it would not, nor would it permit
any of its affiliates to, enter into any agreements with a third party with
respect to the acquisition, directly or indirectly, of shares or other
securities of i360 or a material part of its assets or any merger, business
combination, consolidation or
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<PAGE> 27

reorganization; enter into any negotiations with a third party regarding such
agreement; or provide a third party with general access to i360's books, records
or employees for the purpose of enabling such third party to conduct a purchase
investigation of the legal, financial or business condition of i360.

CLOSING CONDITIONS

The obligations of the Company and i360 are subject to the satisfaction or
waiver of the conditions set forth below.

The respective obligations of the Company and i360 to consummate the Merger
are subject to:

- approval by the Company's and i360's shareholders, respectively, of the
Merger;

- the condition that there will be no judgment, injunction, order or decree
prohibiting or enjoining the consummation of the Merger;

- the parties having received all required third party consents and
approvals;

- the continued accuracy of each party's representations and warranties and
the fulfillment of each party's agreements contained in the Merger
Agreement;

- the absence of a material adverse change or effect with respect to the
Company or i360; and

- execution and delivery of the Merger Agreement, the Escrow Agreement (and
a related Shareholders Designee Agreement), the Registration Rights
Agreement and opinions of counsel.

The obligation of the Company to consummate the Merger is also subject to:

- shareholders representing no more than 8% of the outstanding i360 Common
Stock dissenting from the Merger;

- no more than 35 of i360's shareholders not being accredited investors;
and

- the Company shall have received certain investment-related
representations from the shareholders of i360.

The obligation of i360 to consummate the Merger is also subject to the
approval by the Company Board of the issuance of options for a total of 469,197
shares of Company Common Stock at an exercise price of $4.00 per share to be
awarded to future employees of the Company's i360 division.

WAIVER OF CONDITIONS

Each party to the Merger Agreement may, to the extent legally permitted,
extend the time for performance of any obligations of any other party to the
Merger Agreement, or waive compliance of any party with any terms or conditions
in the Merger Agreement.

VOTING AGREEMENT

In connection with the execution of the Merger Agreement, certain
shareholders of i360 have agreed to vote all shares of i360 Common Stock held by
them in favor of the Merger Agreement and the Merger. The shares covered by this
agreement currently equal 67.4% of the outstanding shares of i360 Common Stock.

REGISTRATION RIGHTS

The shares of Company Common Stock to be issued upon the effectiveness of
the Merger to the shareholders of i360 will not be registered under the
Securities Act of 1933, as amended (the "Securities Act"), in reliance upon the
exemption provided by Section 4(2) of the Securities Act as a transaction not
involving any public offering and Regulation D thereunder and under applicable
state securities laws. Such non-public offering is in part based upon the
investment representations of the recipients of such shares. The shares to be
issued upon the Merger will be "restricted securities" within the meaning of the
Securities Act and will not be transferrable without further compliance with the
registration requirements of the Securities
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<PAGE> 28

Act or compliance with an exemption from such requirements. Neither the Company
nor i360 has received an opinion of legal counsel with regard to the
availability of such exemption and no assurance can be given that the SEC and/or
the securities administrators of certain states would concur that the Section
4(2) exemption or Regulation D and equivalent state non-public offering/private
offering exemptions are available for the transaction.

Pursuant to a Registration Rights Agreement (the "Registration Rights
Agreement") to be executed at the Effective Time, the Company, at its expense,
within six months of the Effective Time, will file a Registration Statement
under the Securities Act to register for resale an aggregate of 2,061,480 shares
of Company Common Stock to be issued in the Merger to certain current
shareholders of i360 or to be issued upon the exercise of options to purchase
Company Common Stock to be issued in exchange for options to purchase i360
Common Stock pursuant to the Merger. A copy of the Registration Rights Agreement
is annexed hereto as Annex D.

LISTING OF COMPANY COMMON STOCK TO BE ISSUED IN THE MERGER

The Company has agreed that, after consummation of the Merger, the Company
Board will authorize the Company Common Stock to be listed or admitted for
trading on Nasdaq or a national securities exchange other than the
over-the-counter bulletin board.

GOVERNMENTAL AND REGULATORY APPROVALS

i360 and the Company are aware of no governmental or regulatory approvals
required for consummation of the Merger, other than compliance with applicable
securities and "blue sky" laws of various states and the filing of the Articles
of Merger under Nevada and Utah laws.

MERGER EXPENSE REIMBURSEMENT; BREAK-UP FEE

Whether or not the Merger is consummated, each of the Company and i360 will
be responsible for its own costs and expenses incurred in connection with the
Merger and the transactions contemplated thereby.

TERMINATION

The Merger Agreement may be terminated and cancelled at any time prior to
the Closing Date by mutual written consent of the Company and i360. The Merger
Agreement may be terminated by either the Company or i360 if: (i) any of the
conditions to such party's obligation to consummate the Merger has not been met
or waived at such time as such condition can no longer be satisfied; (ii) the
transactions contemplated by the Merger Agreement have not been consummated on
or before August 15, 2000; or (iii) a court of competent jurisdiction or other
governmental authority shall have issued a final non-appealable order, decree or
ruling permanently restraining, enjoining or otherwise prohibiting the
transactions contemplated by Merger Agreement.

DISSENTERS' RIGHTS

Under the NGCL, the Company's shareholders have certain dissenters' rights
in connection with the Merger. The following is a summary of the provisions of
the NGCL relating to these dissenters' rights. A copy of the applicable NGCL
provisions are attached hereto as Annex C. Shareholders are urged to read Annex
C in its entirety.

A Company shareholder who wishes to dissent from the proposed Merger and
obtain payment of the fair value of his or her shares of Company Common Stock:
(i) must deliver to the Company, before the vote is taken, written notice of his
or her intent to demand payment for his or her Company Common Stock if the
proposed action is effectuated (the "Shareholder's Notice"); and (ii) must NOT
vote his or her shares in favor of the proposed action. A COMPANY SHAREHOLDER
WHO DOES NOT SATISFY THE REQUIREMENTS OF SUBSECTIONS (i) AND (ii) WILL NOT BE
ENTITLED TO PAYMENT FOR HIS OR HER SHARES. A VOTE AGAINST THE PROPOSED MERGER
WILL NOT BE

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DEEMED TO SATISFY THE SHAREHOLDER NOTICE REQUIREMENT. THE FAILURE TO VOTE
AGAINST THE MERGER PROPOSAL WILL NOT CONSTITUTE A WAIVER OF DISSENTERS' RIGHT.
HOWEVER, A VOTE IN FAVOR OF THE MERGER PROPOSAL WILL CONSTITUTE A WAIVER OF SUCH
RIGHTS.

If the proposed Merger is thereafter approved by the required vote at the
Meeting, the Company shall, within ten (10) days after effectuation of the
action, mail a notice (the "Company Notice") to all Company Shareholders who
prior to the meeting delivered a Shareholder Notice which satisfies the above
requirements. The Company Notice shall:

(i) state where a demand for payment must be sent, and where and when
certificates for certificated shares must be deposited, in order to obtain
payment;

(ii) inform holders of uncertificated shares as to any restriction on
the transfer of shares from the time that demand for payment is received;

(iii) supply a form for demanding payment, which form includes a
request for certification of the date on which the shareholders acquired
beneficial ownership of the shares;

(iv) be accompanied by a copy of NGCL Sections 92A.300 to 92A.500,
inclusive, which set forth the rights of dissenters.

COMPANY SHAREHOLDERS WHO FAIL TO DEMAND PAYMENT, OR FAIL TO DEPOSIT
CERTIFICATES, IN THE MANNER REQUIRED BY THE COMPANY NOTICE PURSUANT TO THE NGCL,
WILL HAVE NO RIGHT TO RECEIVE PAYMENT FOR THEIR SHARES OF COMPANY COMMON STOCK.
A dissenter shall retain all other rights of a Company Shareholder until these
rights are modified by effectuation of the proposed corporate action.

Within thirty (30) days after receipt of demand for payment, the Company
shall remit to dissenters who have made demand and have deposited their
certificates, the amount which the Company estimates to be the fair value of the
shares, with interest, if any has accrued. If the Company fails to remit, of if
the dissenter believes that the amount remitted is less than the fair value of
the shares of Company Common Stock, a dissenter may send the Company its own
estimate of the value of the Company Common Stock and demand payment for the
deficiency. IF A DISSENTER DOES NOT FILE SUCH ESTIMATE WITHIN THIRTY (30) DAYS
AFTER THE COMPANY'S MAILING OF ITS REMITTANCE, SUCH DISSENTER SHALL BE ENTITLED
TO NO MORE THAN THE AMOUNT REMITTED. Within sixty (60) days of the receipt of a
demand payment for the deficiency, the Company shall commence a proceeding and
petition the court to determine the fair value of the Company Common Stock and
accrued interest. If the Company does not commence the proceeding within the
60-day period, it shall pay each dissenter whose demand remains unsettled the
amount demanded.

CERTAIN EFFECTS OF THE MERGER ON THE RIGHTS OF INFOCAST AND I360 SHAREHOLDERS

The rights of shareholders of InfoCast are presently governed by Nevada
law, and the rights of i360 shareholders are presently governed by Utah law. At
the Effective Time, the rights of the shareholders of InfoCast will continue to
be governed by Nevada law. The Articles of Incorporation and Bylaws of InfoCast
will be the Articles of Incorporation and Bylaws of the surviving corporation.

LOAN TO I360 BY INFOCAST

On June 22, 2000, InfoCast entered into a Loan Agreement and a Security
Agreement with i360 under which InfoCast agreed to loan to i360 an aggregate
amount of up to $2,000,000, secured by all of the assets of i360. The Company's
obligation to make Loans under the Loan Agreement terminates and all Loans made
thereunder mature upon consummation of the Merger or earlier termination of the
Merger Agreement in accordance with its terms. The Loans bear interest at the
prime rate plus 2% payable upon Maturity or earlier payment of the Loans. If the
Merger is consummated, the outstanding Loans will be effectively terminated. If

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the merger agreement is terminated, all loans are due and payable six months
after such termination. As at June 30, 2000, the total amount outstanding under
the Loan Agreement was $145,000.

BUSINESS OF I360

i360 is a Utah corporation which was created in July 1999 for the purpose
of using emerging technologies to change the way people communicate. i360
customizes portals and creates virtual communities for individual organizations
through its Portal and Virtual Community System. This gives organizations the
ability to operate and market themselves within the medium of the Internet. The
organizations are able to use i360's back-end architecture as a turnkey
solution. i360 acts as the architect and aggregator of each organization's
online community. i360's Portal and Virtual Community System bundles interactive
products and services, integrating content, commerce and community in a format
that is easy for members of these organizations to use.

i360 specifically targets affinity groups -- organizations that are
comprised of individuals who share a common purpose, interest, identity, or
mission, such as:

- Profit and Non-Profit Associations

- Religious Organizations

- Direct Sales Companies

- Network Marketing Companies

- Unions

- Co-ops & Buying Services

i360 earns revenues from each Internet access subscription, custom portal
design, netHomeTV(TM) sale, e-commerce transaction, advertisement and sale of
interactive tools. The organizations with which i360 executes contracts share in
the revenue generated by Internet subscription services, encouraging
self-marketing. In addition, using third party software and enhancements, i360
can create customized advertising and e-commerce solutions for customers.

i360 believes that its product and services give organizations more control
over content, lower churn rate, branding opportunities, improved group
communication and new revenue streams. i360 also believes that the members of
these organizations will benefit from easier access to the Internet for both
personal computer ("PC") and non-PC users, easier access to information
disseminated by the organization, low-cost interaction with other community
members and a on-line environment that is customized, secure and family
friendly.

INDUSTRY OVERVIEW

i360 is a part of the Internet services industry -- an industry
characterized by rapid change and vigorous competition. The industry is
fragmented and includes many different players who offer a variety of services.
The key industry players relevant to i360's strategy include:

- National and regional online services providers (e.g. AOL)

- National and regional Internet service (access) providers

- Computer manufacturers (vis-a-vis their practice of bundling client
software packages for online navigation and/or "free" service trials or
initial service packages)

- Software companies providing customizable templates to online content
carriers, businesses, and consumers

- Carriers such as local exchange carriers, competitive local exchange
carriers, and cable companies

- Niche providers of hardware, programming, and services (e.g. WebTV and
emerging set-top boxes)

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- Available for purchase/shareware browsers and next-generation browsers

- Search engines/agents and directory services

- Business-to-business and e-commerce providers who provide electronic
storefronts and associated back-end systems

- Media companies and ad agencies who are changing ad publishing rules via
the online medium

- Metric analyst companies such as Nielsen, Media Metrix, etc.

SOURCES OF REVENUE

The premise behind i360's business model is that by bundling compelling
products and services and delivering them through customized Portal and Virtual
Community Systems or ISP clients, i360 can cost effectively capture substantial
customer bases through single points of contact. With its strategy of targeting
affinity groups, i360 can earn additional revenues through highly focused
e-commerce and advertising plays.

i360 anticipates six distinct sources of revenue generation:

- Internet Subscriptions

i360 will sell both wholesale and retail Internet access. Subscribers will
include client organization members and ISP client subscribers.

- Membership/Premium Services

i360 will sell additional services to client organization members such as
the Virtual Community(TM), and training.

- Custom Portal Design

i360 will earn revenue for the design of customized portals for client
organizations.

- Independent Business Operator Page (IBO)

i360 will sell the IBO pages through affinity groups specializing in
network marketing.

- netHomeTV(TM) Internet Appliance (set-top boxes)

i360 will sell its netHomeTV(TM) Internet appliance to client organization
members and ISP client subscribers.

- E-commerce & Advertising Revenue Sharing

i360 will share with client organizations and ISP clients revenue earned
from e-commerce transactions and advertising.

PRODUCTS AND SERVICES

i360 bundles interactive products and services and delivers them through
client organizations such as affinity groups, ISP affiliates and vertical market
companies. The primary platform sold is our Portal and Virtual Community System
that serves as the client's foundation for providing i360's products and
services to their members.

- Custom Portal

This is a template driven tool to construct an information and content
aggregation system for each client. The portal is branded by the client and is
customized to their needs. Included within the Custom Portal is a

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NetGuide that contains links to information such as member information, news,
weather, shopping, sports, travel, health, real estate, stock market info,
classifieds and hobbies.

The actual number of categories and the composition of each category will
depend on each client's requirements. This also represents one of i360's
back-end revenue streams in that i360 will be compensated by each sub-category
provider based on how much traffic is driven to it.

The Custom Portal also includes e-commerce and shopping features, as well
as i360's Virtual Community System, a private intranet for client organizations.
Client organizations have the ability to authenticate each user to ensure that
only authorized end-users have access to the portal.

MEMBERSHIP/PREMIUM SERVICES

This includes i360's proprietary Virtual Community System and a mix of
value-added services. The Virtual Community System is based on over 5 years of
research, field testing and technical development. It is a stand-alone Internet
system that has been designed specifically to offer affinity groups the most
robust collection of business functions available today.

Linked to the client organization's Custom Portal, the Virtual Community
System makes constant communication possible -- by words, pictures, voice, and
even video. Organizations can supply their members with mission critical
information, the latest news updates, special offers, upcoming events,
training -- whatever is crucial for their online community.

Within the Virtual Community System, each member of an affinity group can
create their own customized Web site that is inter-linked with other members,
creating a powerful interactive community web. Like all i360 implementations,
each Virtual Community system will be customized and branded by the client.

Other value-added services offered as Membership/Premium Services include
chat rooms and marketing tools. Especially of interest to our multi-level
marketing clients are lead generation tools and live or Web-based Internet
marketing training programs.

- Client-Branded Internet Subscription Service

This is the connection to the Internet through a client organization's
Internet portal or other online system. Owners of PCs will access the Internet
using a standard browser, while non-PC owners will gain access by using i360's
netHomeTV(TM) appliance. This service satisfies the end-user's need for reliable
access to information and other resources on the Internet, whether or not they
have a PC.

i360 has developed an application -- meshed network -- that enables any
end-user employing dial-up, ISDN or DSL lines to connect to the client
organization's branded Internet service. The meshed network seamlessly
aggregates the dial-up connection, the backbone connection and i360's server
network to put users on the Web in the custom environment of the community of
their choice.

Not only is the meshed network attractive to client organizations such as
affinity groups who seek to connect their broadly dispersed members to the
Internet, but it is also sold to regional ISPs to enhance their capabilities.
The meshed network provides a national network of connections broader in scope
than any regional ISP can provide. It offers the lowest risk, lowest cost way
for branded ISP organizations to provide national coverage virtually overnight.

- netHomeTV(TM) Appliances (set-top boxes)

i360's innovative netHomeTV(TM) solution gives non-PC owners easy access to
i360's package of products and services. The netHomeTV(TM) solution satisfies
the need of non-PC owning end-users for access to Internet information and
services that would otherwise be unavailable to them.

The netHomeTV(TM) solution combines a set-top box with a standard TV and
software with unparalleled technical and user interface capabilities. The system
converges standard television broadcasts (video feed) and Web content
seamlessly.

24
<PAGE> 33

In most cases, each netHomeTV(TM) unit delivered to end-users is
pre-programmed to establish local Internet access as the system is installed.

- E-Commerce Services

i360 will offer client organization members access to a network of
retailers with whom i360 has established strategic relationships, enabling
members to purchase desired products and services through the Custom Portal. Our
portal system will provide a facility for the advertiser to develop and nurture
a permission-based marketing relationship with targeted consumer groups and
individual users.

For organizations that have special needs, i360 will use third party
software and enhancements to create customized e-commerce solutions. For
example, tracking and reporting software can be used to give organizations the
ability to view, verify, and audit any transaction that occurs in the Custom
Portal.

i360 intends to maintain a database containing information such as which
sites members visit and which TV channels netHomeTV(TM) users frequent. i360 can
then present usage/customer demographics and raw market research data to
advertising prospects and inform them about why advertising on our portals can
benefit their business.

- Independent Business Operator Page (IBO)

The IBO provides affinity group members with their own branded on-line Web
page. This page is a customized screen allowing the owner the opportunity to
share customer or business objectives, which expands the users' medium of
communication.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE

Ernst & Young LLP were appointed auditors of i360 on September 17, 1999 and
have audited the consolidated financial statements of i360 since its inception
on July 14, 1999 to December 31, 1999.

i360 believes, and has been advised by Ernst & Young LLP that it concurs in
such belief, that, during the year ended December 31, 1999 and subsequent
thereto, i360 and Ernst & Young LLP did not have any disagreement on any matter
of accounting principles or practice, financial statement disclosure or auditing
scope or procedure, which disagreement, if not resolved to the satisfaction of
Ernst & Young LLP, would have caused it to make reference to the subject matter
of the disagreement in connection with its report on i360's financial
statements.

i360's audited financial statements contained an explanatory paragraph with
the assumption that i360 will continue as a going concern. There were no
"reportable events" within the meaning of Item 304(a)(1) of Regulation S-K
promulgated under the Securities Act.

25
<PAGE> 34

SELECTED CONSOLIDATED FINANCIAL DATA OF I360

The selected financial data set forth below are derived from i360's
financial statements included elsewhere in this Proxy Statement and are
qualified by reference to and should be read in conjunction with such financial
statements, including the notes thereto, and "Management's Discussion and
Analysis of Financial Condition and Results of Operations of i360" included
elsewhere in this Proxy Statement. The financial statements as of and for the
period from July 14, 1999 (inception) through December 31, 1999 have been
audited. The information for the three months ended March 31, 2000 is unaudited
and, in the opinion of i360's management, contains all adjustments (consisting
only of normal recurring adjustments) necessary for a fair presentation of
i360's financial position and results of operations at such dates and for such
periods. The historical results are not necessarily indicative of the results of
operations to be expected in the future.

<TABLE>
<CAPTION>
INCEPTION (JULY 14, 1999) THREE MONTHS ENDED
THROUGH DEC. 31, 1999 MARCH 31, 2000
------------------------- ------------------
<S> <C> <C>
STATEMENT OF OPERATIONS DATA:
Revenues:
Set-top box sales.................................. $ 119,148 $ 73,204
Subscription services.............................. 7,175 217,001
Other.............................................. 29,759 47,145
----------- -----------
Total Revenues.................................. 156,082 337,350
Costs and expenses:
Cost of revenue.................................... 229,884 588,597
Sales and marketing................................ 572,288 306,424
General and administrative......................... 2,017,132 1,142,684
Product development................................ 699,636 296,151
Amortization of goodwill........................... 125,464 94,098
----------- -----------
Total operating costs........................... 3,644,404 2,427,954
----------- -----------
Operating loss....................................... (3,488,322) (2,090,604)
Other income (expense)............................... (558) 247
----------- -----------
Net loss before beneficial conversion................ (3,488,880) (2,090,357)
Deemed dividend for preferred stock.................. -- (3,500,000)
----------- -----------
Net loss attributable to common shareholders......... (3,488,880) (5,590,357)
=========== ===========
Basic and diluted net loss per share................. $ (0.16) $ (0.33)
=========== ===========
BALANCE SHEET DATA:
Total cash........................................... $ 103,471 $ 1,785,795
Total assets......................................... 2,820,168 4,589,395
Total liabilities.................................... 1,727,132 1,586,716
Accumulated deficit.................................. (3,488,880) (9,079,237)
Total stockholders' equity........................... 1,093,036 3,002,679
</TABLE>

26
<PAGE> 35

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF I360

OVERVIEW

On July 14, 1999, i360 was incorporated under the laws of the State of
Utah. i360 designs and develops web-based communities for businesses,
organizations and affinity groups. As a technology enabler, i360 brings a full
complement of Internet and communication solutions to its affinity group
customers. This technology enables these groups to compete with established
Internet portals by emulating a traditional internet service provider ("ISP")
and by recruiting and retaining customers through customized Virtual Community
Systems. i360's technology allows its organizational customers to set up chat
boards, e-commerce operations and news centers specifically tailored to the
individual missions and services of these organizations.

i360 is in its early states and has begun, on a limited basis, to market,
sell and operate Web-based communities. To date, i360 has generated modest
sales. While management believes there is a substantial market for i360's
products and services, there can be no assurance that any sales that are made by
i360 will be at volumes and prices sufficient for i360 to achieve significant
revenues and profitable operations. i360 has been unprofitable since inception
and expects to continue to incur losses for at least the next seven months.

i360's management believes revenues will be derived from a variety of
products in addition to sales of Internet subscription services and
set-top-boxes. These products include: (i) Virtual Communities; (ii) Independent
Business Operator pages ("IBO"); (iii) advertising and e-commerce; and (iv)
Custom Portal development.

Virtual Communities. The Virtual Community System makes constant
communication possible -- by words, pictures, voice and video. Organizations can
supply their members with mission critical information, the latest news updates,
special offers, upcoming events, training or whatever is crucial for their
online community. Within the Virtual Community System, each member of an
affinity group can create their own customized Web site that is inter-linked
with other members, creating a powerful interactive community web. Like all
Company products, each Virtual Community System is customized and branded by the
customer.

Independent Business Operator Page. The IBO provides affinity group
members with their own branded on-line web page. This page is a customized
screen allowing the owner the opportunity to share customer or business
objectives, which expands the users' medium of communication.

Advertising and E-Commerce. i360 will offer client organization members
access to a network of retailers with whom i360 has established strategic
relationships, enabling members to purchase desired products and services
through the Custom Portal. i360's portal system will provide a facility for the
advertiser to develop and nurture a permission-based marketing relationship with
targeted consumer groups and individual users. This information will afford i360
the opportunity to price its advertising rates so the advertiser will not only
increase reach and frequency at a lower-than-traditional cost, but also target
precisely the customer they want to engage.

Custom Portal Development. The Custom Portal is a template driven tool to
construct an information and content aggregation system for each customer. The
portal is branded by the customer and tailored to their specific needs. Included
within the Custom Portal is a NetGuide that contains links to sites which
provide member information, news, weather, shopping, sports, travel, health,
real estate, stock market information, classifieds and hobbies. The Custom
Portal also includes e-commerce and shopping features, as well as i360's Virtual
Community System, a private intranet for customer organizations. Customer
organizations have the ability to authenticate each user to ensure that only
authorized end-users have access to the portal.

27
<PAGE> 36

PURCHASE OF INNOVATIVE TECHNOLOGY SOLUTIONS

In September 1999, i360 acquired Innovative Technology Solutions ("ITS") in
exchange for 2,460,745 shares of i360's common stock. The ITS acquisition
enhanced i360's core technology. In the acquisition, i360 also received rights
to the customized Virtual Community Systems.

RESULTS OF OPERATIONS

Year Ended December 31, 1999. From the formation of i360 in July of 1999
to the end of the year, total revenues earned were $156,082. $119,148 of these
revenues were earned from the sales of set-top-boxes, $7,175 were derived from
ISP sales and $29,759 were earned from other sources. General, administrative
and selling expenses for the period were $2,017,132. These expenses consisted
primarily of costs associated with wages, travel entertainment and consulting
services. Many of these costs were one-time expenditures related to building an
administrative infrastructure in anticipation of increases in the numbers of
both customers and employees going forward. Also, i360 incurred significant
travel and entertainment expenses in recruiting key employees nationally.
Additionally, consultants were engaged to help i360 develop employee benefits
and incentive packages. Consultants were also retained to assist i360 with
defining its business and technical processes. For the period, product
development expenses, primarily related to the development of the CD content to
drive the ISP registration process, totaled $699,636.

Three Months Ended March 31, 2000. During the three months ended March 31,
2000, i360 earned total revenues of $337,350; $217,001 were derived from
internet subscription services, $73,204 were earned from set top box sales and
$47,145 were earned from other sources. For the same period, general,
administrative and selling expenses were $1,142,684. These expenses principally
consisted of wages, rent and professional services. An additional $588,597 in
cost of revenue expenses were incurred during the three months ended March 31,
2000 for third party ISP backbone providers, technical help desk support, and
set top box purchases.

LIQUIDITY AND CAPITAL RESOURCES

As of March 31, 2000, i360 had cash and cash equivalents of $1,785,795 and
working capital of $749,154. Since inception, i360's net cash utilized in
operating activities was approximately $4,800,000. Major components of cash flow
from operations included an increase in accounts payable, accrued liabilities
and other payables of $1,030,238, $290,000 for increases in deposits relating to
a building deposit, an increase in prepaid expenses and other of $282,972, and
the effects of a $5,579,237 loss from operations from inception to March 31,
2000. Since inception, i360 has purchased $515,923 of equipment, primarily
related to the purchase of a phone system and hardware and software for
employees. Additionally, from inception to March 31, 2000, i360 generated net
cash from financing activities of $6,975,217, of which $3,500,000 was from the
sale of preferred shares and $4,114,805 was from the sale of common shares.

Following the merger, InfoCast has agreed, subject to i360 substantially
achieving identified revenue targets, to fund as necessary the operational
budget of i360 for the balance of the year 2000. i360 believes that the funding
from InfoCast, together with other available cash, including any net cash flow
from operations, will be sufficient to meet i360's operating expenses for the
next 12 months. Absent such funding by InfoCast, i360 believes that available
cash, including any cash flow from operations, will be sufficient to meet i360's
operating expenses for only the next three months. i360's capital requirements
depend on numerous factors, including i360's ability to maintain and expand its
customer base, i360's research and development activities, the rate of market
acceptance of i360's products and other factors. Any inability to obtain funding
when needed and on terms favorable to i360 could have a material adverse effect
on i360.

YEAR 2000 COMPLIANCE

many systems. Most reports to date, however, are that computer systems are
functioning normally and the compliance and remediation work accomplished
leading up to 2000 was effective to prevent any problems.

To date, i360 has not experienced such problems. Computer experts have
warned, however, that there may still be residual consequences of the change in
centuries. For example, some software programs may have difficulty resolving the
so-call "century leap year" algorithm which will occur during the Year 2000. Any
such residual consequences could result in hardware failure, the corruption or
loss of data contained in i360's internal information system, and failures
affecting key vendors, suppliers or customers. This in turn may lead to legal
action, and any otherwise also have a material adverse effect on i360's
business, results of operations or financial condition.

29
<PAGE> 38

SELECTED CONSOLIDATED FINANCIAL DATA OF THE COMPANY

The selected financial data set forth below are derived from the Company's
financial statements included elsewhere in this Proxy Statement and are
qualified by reference to and should be read in conjunction with such financial
statements, including the notes thereto, and "Management's Discussion and
Analysis of Financial Condition and Results of Operations of the Company"
included elsewhere in this Proxy Statement. The financial statements as of and
for the year ended March 31, 2000, the three months ended March 31, 1999, the
year ended December 31, 1998 and the period from July 29, 1997 (inception) to
December 31, 1997 have been audited by Ernst & Young LLP, independent certified
public accountants. The information for the three months ended March 31, 1998 is
unaudited and, in the opinion of the Company's management, contains all
adjustments (consisting only of normal recurring adjustments) necessary for a
fair presentation of the Company's financial position and results of operations
at such dates and for such periods. The historical results for the periods ended
December 31, 1997 and 1998 and March 31, 1998 are those of Virtual Performance
Systems. The historical results are not necessarily indicative of the results of
operations to be expected in the future.

<TABLE>
<CAPTION>
THREE MONTHS ENDED PERIOD FROM
MARCH 31, JULY 29, 1997
YEAR ENDED --------------------- YEAR ENDED (INCEPTION) TO
MARCH 31, 2000 1999 1998 DECEMBER 31, 1998 DECEMBER 31, 1997
-------------- ---------- -------- ----------------- -----------------
<S> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS
DATA:
Revenues................ $ 305,754 $ -- $ 43,446 $ 43,446 $ 3,508
General, administrative
and selling expense... $ 7,391,128 $ 635,334 $ 42,494 $375,302 $47,954
Stock option
compensation
expense............... $13,351,908 $2,256,938 $ -- $ -- $ --
Research and development
expense............... $ 5,186,265 $ 162,914 $ 19,703 $ 88,180 $51,257
Interest and loan
fees.................. $ 1,913,482 $ 23,562 $ -- $ -- $ --
Amortization............ $ 4,315,180 $ 4,144 $ -- $ 3,836 $ --
Depreciation............ $ 495,401 $ 5,507 $ 870 $ -- $ 458
Total expenses.......... $32,653,364 $3,088,399 $ 63,067 $467,318 $99,669
Interest income......... $ 132,057 $ 4,478 $ -- $ -- $ --
Net loss for the
period................ $31,151,184 $3,083,921 $ 19,621 $423,872 $96,161
Net loss per share...... $ 1.37 $ 0.27 $ 478.56 $ 0.55 $ 2,345
</TABLE>

<TABLE>
<CAPTION>
AS OF MARCH 31, AS OF DECEMBER 31,
--------------------------------------- ---------------------
2000 1999 1998 1998 1997
-------------- ---------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
BALANCE SHEET DATA:
Cash and cash equivalents....... $ 3,637,931 $3,092,445 $ -- $ 25,595 $ 301
Working capital................. $ 5,823,306 $2,840,129 $(126,785) $(564,601) $(106,438)
Total assets.................... $34,569,481 $4,025,076 $ 47,510 $ 143,467 $ 28,604
Long term debt and obligations
under capital leases,
excluding current portion..... $ 4,302,836 $ -- $ -- $ -- $ --
Stockholders' equity............ $22,295,007 $3,493,112 $(115,376) $(496,667) $ (94,459)
</TABLE>

30
<PAGE> 39

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF THE COMPANY

The consolidated financial statements of the Company are the continuing
financial statements of Virtual Performance Systems, Inc., a development stage
company and an Ontario corporation incorporated on July 29, 1997. Virtual
Performance Systems had a 100% interest in, and subsequently merged with,
Cheltenham Technologies Corporation ("Cheltenham Technologies"), an Ontario
corporation. Virtual Performance Systems has a 100% interest in Cheltenham
Interactive Corporation ("Cheltenham Interactive"), an inactive Ontario
corporation, and Cheltenham Technologies (Bermuda) Corporation ("Cheltenham
Bermuda"), a Barbados corporation that owns certain intellectual property. On
January 29, 1999, Virtual Performance Systems acquired the net assets of the
Company (formerly known as Grant Reserve Corporation), a United States
non-operating company traded on the Nasdaq OTC Bulletin Board, which had a 100%
interest in InfoCast Canada Corporation ("InfoCast Canada"). After the
acquisition, the accounting entity continued under the name of InfoCast
Corporation. InfoCast Corporation, InfoCast Canada, Virtual Performance Systems,
Cheltenham Technologies, Cheltenham Interactive and Cheltenham Bermuda are
collectively referred to in this section as the "Company."

The following discussion should be read in conjunction with our historical
financial statements and notes thereto included elsewhere in this Proxy
Statement.

OVERVIEW

We are an emerging company that has developed the infrastructure to enable
us to host both our own customized and third-party software applications that
can be accessed remotely by businesses and their employees. This infrastructure
consists of: computer hardware purchased from third parties; software
applications; and communication connections over private and public networks,
including the Internet. We are now entering the commercialization phase and plan
to provide our customers with access to our infrastructure and hosted
applications on a per use basis. Companies providing such services have recently
come to be known as application service providers or "ASPs."

We have incurred operating losses since our inception in July 1997. We have
had limited sales of our products and services on a commercial basis. We have
sustained ourselves through the sale of Company Common Stock and warrants to
purchase Company Common Stock in a series of private placements, the issuance of
convertible debentures and shareholder loans. On a long term basis, we will need
to raise additional funds through private or public financings, strategic or
other relationships. There can be no assurance that such funds will be available
on commercially reasonable terms in the future.

We acquired HomeBase Work Solutions in May 1999 in exchange for 3,400,000
shares of InfoCast Canada, which shares are exchangeable into Company Common
Stock. The HomeBase Work Solutions acquisition provided us with the core
technology for our information hub strategy. The acquisition also introduced
third-party application hosting initiatives to the Company which will be hosted
on our information hubs. The virtual call center application and distance
learning library developed by us will also be hosted on the information hubs.

Effective for the period ended March 31, 1999 we changed our fiscal year
end from December 31 to March 31. Therefore, financial statements have been
prepared for the three month transition period ended March 31, 1999.

RESULTS OF OPERATIONS

Year ended March 31, 2000 vs. year ended March 31, 1999

Revenue increased from zero for the year ended March 31, 1999 to $305,754
for the year ended March 31, 2000 as we began to earn hosting and distance
learning revenues, received revenue from the sale of computer equipment and
performed miscellaneous consulting services during the period ended March 31,
2000.

31
<PAGE> 40

Interest income increased from $4,478 for the year ended March 31, 1999 to
$132,057 for the year ended March 31, 2000. The proceeds received from the
private placements in 1999 were invested in short term deposits which generated
interest income for us during the year ended March 31, 2000, consistent with our
investment policy.

General, administrative and selling expenses increased from $968,142 for
the year ended March 31, 1999 to $7,391,128 for the year ended March 31, 2000.
The consolidation of the operations of HomeBase Work Solutions for the period
May 13, 1999 to March 31, 2000 accounted for $382,000 of the increase. We had
seven more employees involved in general, administrative and selling functions
in the year ended March 31, 2000 than for the same period ended March 31, 1999,
contributing approximately $540,000 to the increase in expenses. We paid
consulting fees to three additional consultants during the year ended March 31,
2000 compared to the same period ended March 31, 1999 resulting in an increase
in consulting fees of approximately $1,214,000 for the year ended March 31,
2000. Investor relations costs of $1,143,465 were incurred for the year ended
March 31, 2000. Additional rent expenses of $127,000 were incurred for the two
U.S. offices that were not open in September 1998 and the expanded Toronto
office space. We expensed $644,000 for warrants issued for services during the
year ended March 31, 2000 and expensed an additional $439,800 related to common
stock issued for services during the year ended March 31, 2000. We incurred
sales and marketing expenses related to the Call Center Learning Solutions
On-Line Inc. joint venture of $198,000 during the year ended March 31, 2000.

Stock option compensation expense increased from $2,256,938 for the year
ended March 31, 1999 to $13,351,908 for the year ended March 31, 2000. This
increase is due to the amortization of the deferred compensation amount
resulting from the grant of stock options to various individuals involved in the
management and operations of the Company.

Research and development expenses increased from $231,391 for the year
ended March 31, 1999 to $5,186,265 for the year ended March 31, 2000. This
increase is primarily due to continued efforts to develop and expand our product
offerings. We incurred expenses of approximately $607,000 from the write off of
advances made to ACT which had been used to fund development expenses related to
the electronic conversion of courseware in the year ended March 31, 2000. We
also wrote off a $95,000 receivable from ACT to research and development expense
during the year ended March 31, 2000. We also expensed $1,337,500 which was the
value attributed to the 200,000 common shares issued to two ACT shareholders
during the year ended March 31, 2000. The consolidation of the operations of
HomeBase Work Solutions for the year ended March 31, 2000 accounted for
$1,639,000 of the increase. We had nine more employees involved in research and
development functions in the year ended March 31, 2000 than for the same period
ended March 31, 1999, contributing approximately $663,000 to the increase in
expenses. We paid consulting fees to the same number of consultants during the
year ended March 31, 2000 compared to the same period ended March 31, 1999 but
incurred approximately $71,000 in additional consulting fees for the year ended
March 31, 2000.

Interest and loan fees increased from $23,562 for the year ended March 31,
1999 to $1,913,482 for the year ended March 31, 2000. The convertible
subordinated debentures that were issued on March 30, 2000 have a conversion
feature that was in-the-money and exercisable at the date of issuance resulting
in the intrinsic value of the feature of $1,913,482 being charged to interest
expense at the time the debentures were issued.

Amortization expenses increased from $4,144 for the year ended March 31,
1999 to $4,315,180 for the year ended March 31, 2000. Amortization of the
acquired intellectual property and goodwill resulting from the acquisition of
HomeBase Work Solutions accounted for the majority of the increase in the
amortization expense for the year.

Depreciation expenses increased from $8,473 for the year ended March 31,
1999 to $495,401 for the year ended March 31, 2000. This increase is a result of
the acquisition of additional capital assets between April 1, 1999 and March 31,
2000.

Equity in loss of joint venture increased from zero for the year ended
March 31, 1999 to $164,736 for the year ended March 31, 2000. During the year
ended March 31, 2000, we became shareholders in a new

32
<PAGE> 41

company that is developing a web-enabled trading business model for crude oil
and natural gas liquids and other products. As at March 31, 2000, our ownership
in this company was 34.48% on a fully diluted basis.

Deferred income taxes increased from zero for the year ended March 31, 1999
to $1,229,105 for the year ended March 31, 2000 as a result of the draw down of
the deferred income tax liability created by the purchase of HomeBase Work
Solutions by the Company in respect of the difference in the tax and accounting
basis of various intellectual property assets.

Year ended December 31, 1998 compared to the 156 day period ended December 31,
1997

Revenue increased from $3,508 for the 156 day period ended December 31,
1997 to $43,446 for the year ended December 31, 1998. This increase is due to
the timing of the provision of one-time computer programming services, as we
began providing these services at the end of 1997 and continued to provided
these services in the first calendar quarter of 1998. In early 1998 we
discontinued providing these consulting services.

General, administrative and selling expenses increased from $47,954 for the
156 day period ended December 31, 1997 to $375,302 for the year ended December
31, 1998. This increase is due to the expenses being incurred for the full year
ended December 31, 1998 compared to a 156 day period ended December 31, 1997 and
the continuing expansion of business operations. Consulting fees were higher in
1998 as we engaged additional consultants to assist in building the management
team and enhancing the business model and infrastructure of the Company. We
incurred higher legal costs in 1998 as a result of legal services rendered
during 1998 for the reverse takeover transaction, as well as for the HomeBase
Work Solutions acquisition, both of which were completed in 1999.

Research and development expenses increased from $51,257 for the 156 day
period ended December 31, 1997 to $88,180 for the year ended December 31, 1998.
This increase is due to the expenses being incurred for the full year ended
December 31, 1998 compared to a 156 day period ended December 31, 1997 and the
continuing expansion of our research and development efforts.

Depreciation expenses increased from $458 for the 156 day period ended
December 31, 1997 to $3,836 for the year ended December 31, 1998. This increase
is a result of depreciation being incurred for the full year ended December 31,
1998 compared to a 156 day period ended December 31, 1997 and the acquisition of
additional capital assets during the year ended December 31, 1998.

LIQUIDITY AND CAPITAL RESOURCES

Inception to March 31, 2000

At March 31, 2000, we had cash and cash equivalents of $3,637,931 and
working capital of $5,823,306. Our cash and cash equivalent position has been
generated through a series of equity and debt offerings net of development stage
expenditures. To date, we have generated limited revenues.

From our inception on July 29, 1997 to January 29, 1999, Virtual
Performance Systems issued 3,624,100 shares of Common Stock for cash proceeds of
Cdn.$3,732 (or $2,586 in U.S. dollars as of December 31, 1999). Pursuant to the
reverse takeover transaction on January 29, 1999, the shareholders of Virtual
Performance Systems sold their 100% interest in Virtual Performance Systems to
the Company in consideration for 1,500,000 shares of InfoCast Canada, which
shares are exchangeable into Common Stock of the Company for no additional
consideration. Such exchangeable shares have been deemed as shares of Common
Stock of the Company because they are the economic equivalent of the Company's
Common Stock. At the time of the reverse takeover, the Company (formerly Grant
Reserve Corporation) had 13,580,000 shares of Common Stock outstanding which
continued as shares of Common Stock of the continuing entity. Subsequent to the
reverse takeover and up to March 31, 2000, we issued 3,023,333 shares of Common
Stock at $1.50 per share in a private placement in March 1999, 60,000 shares of
Common Stock in consideration for consulting services in March 1999, 420,000
shares of Common Stock at $5.00 per share in a private placement in June 1999,
1,879,000 shares of Common Stock at $5.50 per share in a private placement from
July 1999 to November 1999. We have raised cash proceeds of $15,478,400 from
these private placements, net of share issuance costs.

33
<PAGE> 42

In February 2000 we issued 500,000 shares of Common Stock in a private
placement for which we received 150,000 shares of restricted Common Stock of
another publicly traded company as consideration, of which we will retain
130,000 shares after commissions. At March 31, 2000, these 130,000 shares had a
market value of $3,900,000. At May 31, 2000, the market value of these shares
had decreased to $1,852,500.

In March 2000 we issued 3,500 units of convertible subordinated debentures
at $1,000 per unit for proceeds of $3,225,000, net of commissions. In April
2000, we issued an additional 2,500 units of convertible subordinated debentures
at $1,000 per unit for proceeds of $2,325,000, net of commissions.

From our inception, we have used $10,786,000 for operating activities
before changes in non-cash working capital balances mainly as a result of
general, administrative and selling and research and development expenditures,
net of incidental revenues. We used a further $2,142,000 for the purchase of
capital assets, $2,975,000 on the purchase of distribution rights and $323,000
on the placement of deposits.

We relied on term loans from shareholders, directors and officers during
the period from our inception to the completion of the March 1999 private
placement to fund our operations. These loans were repaid as at June 30, 1999
from the proceeds of the private placements. We expect to use our existing cash
and cash equivalents for the following:

- We plan to continue to invest in the research and development of our
information hub products and services and anticipate spending
approximately $5,800,000 on these efforts from April 1, 2000 to March 31,
2001. We believe that the revenue we expect to generate and related cash
collections from sales of information hub products and services will help
fund the cash requirements of this division, but there can be no
assurance that it will do so.

- We will use approximately $2,000,000 from April 1, 2000 to March 31, 2001
to deploy and enhance our virtual call center application. We believe
that the revenue we expect to generate and related cash collections from
sales of the virtual call center application will help fund the cash
requirements of this application, but there can be no assurance that it
will do so.

- We expect to use approximately $600,000 from April 1, 2000 to August 31,
2000 in the development, deployment and electronic conversion of
courseware for the distance learning application. We believe that the
revenue we expect to generate and related cash collections from sales of
the distance learning application will help fund the cash requirements of
this application, but there can be no assurance that it will do so.

- We will use approximately $6,000,000 to fund the post-acquisition
expenses of i360.

- We will use the remaining capital resources to fund possible
complementary acquisitions, develop new technologies and other corporate
working capital needs.

We believe that our existing cash, expected revenues as well as additional
proceeds we hope to receive from the completion of future potential financings
will be sufficient to support our growth for approximately the next twelve
months. In the event that additional financings are not completed and expected
revenues and cash flows are not achieved, the Company intends to curtail its
development plans and reduce expense levels significantly at the appropriate
time. In such event, the Company believes that its current cash reserves will
support limited activities until May 2001.

On a long term basis, we will need to raise additional funds through
private or public financing, strategic or other relationships. There can be no
assurance that we will be able to raise any additional funds.

Inflation has not been a major factor in our business. There can be no
assurances that this will continue.

YEAR 2000 COMPLIANCE

Prior to January 1, 2000, there was a great deal of concern regarding the
ability of computers to adequately distinguish 21st century dates from 20th
century dates due to the two-digit date fields used by many systems. Most
reports to date, however, are that computer systems are functioning normally and
the compliance and remediation work accomplished leading up to 2000 was
effective to prevent any problems.
34
<PAGE> 43

To date, we have not experienced such problems. Computer experts have
warned, however, that there may still be residual consequences of the change in
centuries. For example, some software programs may have difficulty resolving the
so-call "century leap year" algorithm which will also occur during the Year
2000. Any such residual consequences could result in hardware failure, the
corruption or loss of data contained in our internal information system, and
failures affecting our key vendors, suppliers or customers. This in turn may
lead to legal action, and may otherwise also have a material adverse effect on
our business, results of operations or financial condition.

35
<PAGE> 44

PRINCIPAL SHAREHOLDERS OF THE COMPANY

The following table sets forth information concerning ownership of Company
Common Stock, as of the Record Date, pre-merger and post-merger, by (i) each
person who is known by the Company to be the beneficial owner of more than five
percent of the Company Common Stock, (ii) each of the Company's directors and
i360's nominees for director, (iii) each of the Company's executive officers;
and (iv) all current directors and executive officers of the Company as a group.

<TABLE>
<CAPTION>
PRE-MERGER POST-MERGER
AMOUNT AND AMOUNT POST-
NATURE OF PRE-MERGER AND NATURE OF MERGER
BENEFICIAL PERCENT OF BENEFICIAL PERCENT OF
NAME AND ADDRESS(1) OWNERSHIP(2) CLASS(2) OWNERSHIP(2) CLASS(2)
------------------- ------------ ---------- ------------- ----------
<S> <C> <C> <C> <C>
Darcy Galvon................................ 617,910(3) 2.80% 617,910(3) 2.09%
A. Thomas Griffis........................... 9,179,997(4) 42.65% 9,179,997(4) 31.54%
James Leech................................. 9,257,500(5) 42.71% 9,257,500(5) 31.64%
Michael Sheehan............................. 9,305,000(6) 42.74% 9,305,000(6) 31.70%
Richard Shannon............................. 309,999(7) 1.43% 309,999(7) 1.06%
George Shafran.............................. 9,088,334(8) 42.23% 9,088,334(8) 31.22%
Alexander Walsh............................. 9,155,000(9) 42.39% 9,155,000(9) 31.35%
Herve Seguin................................ 116,667(10) * 116,667(10) *
Jennifer Scoffield.......................... 116,667(11) * 116,667(11) *
Carl Stevens................................ 83,334(12) * 83,334(12) *
Jeffrey Spindler............................ 15,000(13) * 15,000(13) *
Glen Allmendinger........................... 8,334(14) * 8,334(14) *
Treetop Capital Inc......................... 8,955,000(15) 41.80% 8,955,000(15) 30.87%
c/o Griffis International
1 Richmond Street West,
Suite 901, Toronto,
Ontario M5H3W4
Don Jeffrey................................. 9,880,749(16) 45.91% 9,880,749(16) 33.95%
William G. Cochrane......................... 0(17) 0% 2,601,900(17) 8.39%
S. Drexel Ridley............................ 0(18) 0% 2,586,900(18) 8.35%
All officers and directors as a group (12
persons pre-merger, 14 persons
post-merger).............................. 11,433,741 48.28% 16,622,541 47.15%
</TABLE>

---------------
* less than 1%

(1) Except as otherwise indicated, the address for each of the named
individuals is c/o InfoCast Corporation, 1 Richmond Street West, Suite 902,
Toronto, Ontario, Canada M5H 3W4.

(2) Except as otherwise indicated, the stockholders listed in the table have
sole voting and investment power with respect to all shares of Company
Common Stock beneficially owned by them. Pursuant to the rules and
regulations of the SEC, shares of Company Common Stock that an individual
or group has a right to acquire within sixty (60) days pursuant to the
exercise of warrants or options are deemed to be outstanding for the
purposes of computing the percentage ownership of such individual or group,
but are not deemed to be outstanding for the purpose of computing the
percentage ownership of any other person shown in the table.

(3) Represents (i) 517,000 shares to be issued in exchange for outstanding
exchangeable shares of InfoCast Canada Corporation, (ii) 100,000 shares
issuable upon exercise of options granted to Mr. Galvon under the 1998
Stock Option Plan and (iii) 910 shares of Common Stock held by Mr. Galvon's
spouse.

(4) Represents (i) 124,997 shares of Common Stock held by Griffis International
Limited, of which Mr. Griffis, the Chairman of the Board of the Company,
owns 100%, (ii) 100,000 shares issuable upon exercise of options granted to
Mr. Griffis under the 1998 Stock Option Plan and (iii) 8,955,000 shares
held by Treetop Capital Inc. ("Treetop"), of which Griffis International
Limited is a shareholder.

36
<PAGE> 45

Mr. Griffis and Griffis International Limited have no control over Treetop
or power to direct Treetop's voting or disposition of its interest in the
Company other than with respect to 1,020,000 shares of which Griffis
International Limited is the beneficial owner. Thus, Mr. Griffis disclaims
beneficial ownership with respect to 7,935,000 of the shares of the
Company's Common Stock owned by Treetop. Treetop expects to distribute in
the near future the shares it holds in the Company on a pro rata basis to
Treetop's shareholders.

(5) Represents (i) 52,500 shares of Company Common Stock held by Mr. Leech,
(ii) 250,000 shares issuable upon exercise of options granted to Mr. Leech
in June 1999 and (iii) 8,955,000 shares held by Treetop of which Mr. Leech
is an option holder and officer. Mr. Leech has no control over Treetop or
power to direct Treetop's voting or disposition of its interest in the
Company other than with respect to 300,000 shares of which he is the
beneficial owner. Thus, Mr. Leech disclaims beneficial ownership with
respect to 8,655,000 of the shares of the Company's Common Stock owned by
Treetop. Treetop expects to distribute in the near future the shares it
holds in the Company on a pro rata basis to Treetop's shareholders.

(6) Represents (i) 350,000 shares issuable upon exercise of options granted to
Mr. Sheehan under the 1998 Stock Option Plan and (ii) 8,955,000 shares held
by Treetop, of which Mr. Sheehan is a shareholder. Mr. Sheehan has no
control over Treetop or power to direct Treetop's voting or disposition of
its interest in the Company other than with respect to 175,000 shares of
which he is the beneficial owner. Thus, Mr. Sheehan disclaims beneficial
ownership with respect to 8,780,000 of the shares of the Company's Common
Stock owned by Treetop. Treetop expects to distribute in the near future
the shares it holds in the Company on a pro rata basis to Treetop's
shareholders.

(7) Includes (i) 219,999 shares to be issued in exchange for outstanding shares
of InfoCast Canada and (ii) 90,000 shares issuable upon exercise of options
granted to Mr. Shannon under the 1999 Stock Option Plan.

(8) Represents (i) 100,000 shares issuable upon exercise of options granted to
Mr. Shafran under the 1998 Stock Option Plan, (ii) 33,334 shares of Company
Common Stock held by Mr. Shafran and (iii) 8,955,000 shares held by
Treetop, of which Mr. Shafran is a shareholder. Mr. Shafran has no control
over Treetop or power to direct Treetop's voting or disposition of its
interest in the Company other than with respect to 225,000 shares of which
he is the beneficial owner. Thus, Mr. Shafran disclaims beneficial
ownership with respect to 8,730,000 of the shares of the Company's Common
Stock owned by Treetop. Treetop expects to distribute in the near future
the shares it holds in the Company on a pro rata basis to Treetop's
shareholders.

(9) Represents (i) 200,000 shares issuable upon exercise of options granted to
Mr. Walsh under the 1999 Stock Option Plan and (ii) 8,955,000 shares held
by Treetop, of which Mr. Walsh is a shareholder. Mr. Walsh has no control
over Treetop or power to direct Treetop's voting or disposition of its
interest in the Company other than with respect to 300,000 shares of which
he is the beneficial owner. Thus, Mr. Walsh disclaims beneficial ownership
with respect to 8,655,000 of the shares of the Company's Common Stock owned
by Treetop. Treetop expects to distribute in the near future the shares it
holds in the Company on a pro rata basis to Treetop's shareholders.

(10) Represents 116,667 shares issuable upon exercise of options granted to Mr.
Seguin under the 1999 Stock Option Plan.

(11) Represents 116,667 shares issuable upon exercise of options granted to Ms.
Scoffield under the 1999 Stock Option Plan.

(12) Represents 83,334 shares issuable upon exercise of options granted to Mr.
Stevens under the 1999 Stock Option Plan.

(13) Includes 5,000 shares issuable upon exercise of options granted to Mr.
Spindler under the 1999 Stock Option Plan.

(14) Represents 8,334 shares issuable upon exercise of options granted to Mr.
Allmendinger under the 1999 Stock Option Plan.

(15) Represents shares to be distributed to its shareholders on a pro rata basis
in the near future.

37
<PAGE> 46

(16) Represents (i) 825,749 shares of Company Common Stock held by Mr. Jeffrey,
(ii) 100,000 shares issuable upon exercise of options granted to Mr.
Jeffrey under the 1998 Stock Option Plan, and (iii) 8,955,000 shares held
by Treetop, of which Mr. Jeffrey or his wholly-owned company is a
shareholder. Mr. Jeffrey has no control over Treetop or power to direct
Treetop's voting or disposition of its interest in the Company other than
with respect to 1,103,680 shares of which he is the beneficial owner. Thus,
Mr. Jeffrey disclaims beneficial ownership with respect to 7,851,320 of the
shares of the Company's Common Stock owned by Treetop. Treetop expects to
distribute in the near future the shares it holds in the Company on a pro
rata basis to Treetop's shareholders.

(17) Mr. Cochrane will become an executive officer and director of the Company
upon consummation of the Merger. Represents (i)600,000 shares of Company
Common Stock held by Mr. Cochrane to be issued in exchange for his i360
Common Stock and (ii) 2,001,900 shares of Company Common Stock issuable
upon exercise of warrants and options granted to Mr. Cochrane to be issued
in exchange for options to purchase shares of i360 common stock.

(18) Mr. Ridley will become a director of the Company upon consummation of the
Merger. Represents (i)600,000 shares of Company Common Stock held by Mr.
Ridley to be issued in exchange for his i360 Common Stock and (ii)
1,986,900 shares of Company Common Stock issuable upon exercise of warrants
and options granted to Mr. Ridley to be issued in exchange for options to
purchase shares of i360 common stock.

38
<PAGE> 47

HISTORICAL AND PRO FORMA COMPARATIVE PER SHARE DATA OF
THE COMPANY AND I360 (UNAUDITED)

The following tables present comparative per share information for the
Company and i360 on a historical basis and on a pro forma basis assuming that
the acquisition had occurred at April 1, 1999 for cash dividends and earnings
per common share -- diluted and as of March 31, 2000 for book value per common
share.

The pro forma information was prepared using the purchase method of
accounting. The pro forma information presented reflects the results of pro
forma adjustments that are based on preliminary estimates of fair market value
and certain assumptions that the Company believes are reasonable under
circumstances. The actual allocation of the consideration paid by the Company
for i360 may differ from that reflected in this pro forma information after a
more extensive review of the fair market values of the assets acquired and
liabilities assumed has been completed. The unaudited pro forma information does
not purport to present the financial position or results of operations of the
Company had the transactions and events assumed therein occurred on the dates
specified, nor is it necessarily indicative of the results of operations that
may be achieved in the future. The unaudited pro forma information does not give
effect to any operating efficiencies or cost savings that may be realized as a
result of the merger, primarily related to reduction of duplicative operating,
general and administrative expenses.

The tables should be read in conjunction with the Company's consolidated
financial statements and notes incorporated by reference in this Proxy Statement
and the financial statements and notes of i360 included elsewhere in this Proxy
Statement.

PRO FORMA HISTORICAL

<TABLE>
<CAPTION>
HISTORICAL PRO FORMA
MARCH 31, MARCH 31,
2000 2000
---------- ---------
<S> <C> <C>
INFOCAST CORPORATION
Book value per common share................................. $ 0.91 $ 2.39
Dividends per common share.................................. 0 0
Earnings per common share -- diluted........................ (1.37) (1.81)
------ ------
</TABLE>

EQUIVALENT HISTORICAL PRO FORMA

<TABLE>
<CAPTION>
INCEPTION TO
INCEPTION TO MARCH 31,
MARCH 31, 2000
I360 INC. 2000 EQUIVALENT HISTORICAL
--------- ------------ ---------------------
<S> <C> <C>
Book value per common share(i).............................. $ 0.18 $ 0.61
Dividends per common share.................................. 0 0
Earnings per common share -- diluted(ii).................... (0.32) (1.05)
</TABLE>

---------------
(i) Based on common shares outstanding and excluding common shares issued upon
conversion of preferred shares.

(ii) Based on weighted average common shares plus 9,000,000 common shares
issuable upon conversion of preferred shares.

39
<PAGE> 48

MARKET PRICE OF THE COMPANY'S COMMON STOCK AND
RELATED STOCKHOLDER MATTERS

The Company's Common Stock is currently traded on the OTC Bulletin Board
under the symbol "IFCC." Prior to changing its name to InfoCast Corporation on
December 31, 1998, the Company's Common Stock traded on the OTC Bulletin Board
under the symbol "GNRS." The following table sets forth the high and low prices
on the OTC Bulletin Board for the periods indicated, as reported by the OTC
Bulletin Board (as adjusted to reflect a 2-for-1 stock split effected on October
20, 1998). The quotations are interdealer prices without adjustment for retail
markups, markdowns or commissions and do not necessarily represent actual
transactions. These prices may not necessarily be indicative of any reliable
market value.

<TABLE>
<CAPTION>
HIGH LOW
------ -----
<S> <C> <C>
1998
Third Quarter
(August 7, 1998 to September 31, 1998).................... $ 0.63 $0.25
Fourth Quarter
(October 1, 1998 to December 31, 1998).................... $ 5.25 $0.19
1999 (January 1, 1999 to March 31, 1999)
First Quarter............................................... $ 7.00 $4.25
2000 (April 1, 1999 to March 31, 2000)
First Quarter............................................... $10.12 $4.50
Second Quarter.............................................. $13.00 $7.00
Third Quarter............................................... $ 8.88 $5.56
Fourth Quarter.............................................. $10.25 $5.81
</TABLE>

On July 14, 2000, the last reported sale price of the Company Common Stock
on the OTC Bulletin Board was $3.0625 per share.

DIVIDEND POLICY

The Company has not paid cash dividends on its Common Stock since its
inception. The Company does not intend to pay cash dividends on Company Common
Stock in the foreseeable future. The Company currently intends to reinvest
earnings, if any, in the development and expansion of its business. The
declaration of dividends in the future will be at the election of the Company's
Board of Directors and will depend upon the Company's earnings, capital
requirements and financial position, general economic conditions and other
relevant factors.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS OF THE COMPANY

During the year ended March 31, 2000, the Company paid consulting fees to
A. Thomas Griffis, the Co-Chairman of the Board of the Company, who is the sole
owner of Griffis International Limited, in the amount of Cdn $210,000 (or
$142,740 in U.S. dollars as of March 31, 2000) and accrued an additional Cdn
$30,000 (or $20,392 in U.S. dollars as of March 31, 2000) for financial and
management consulting services rendered. The Company will continue to pay a
monthly consulting fee of Cdn $15,000 (or $10,195 in U.S. dollars as of March
31, 2000) while services are being rendered.

During the year ended March 31, 2000, the Company paid consulting fees to
Don Jeffrey, a shareholder beneficially owning greater than 5% of the
outstanding shares of the Company, in the amount of Cdn $105,000 (or $71,370 in
U.S. dollars as of March 31, 2000) for consulting services related to business
development and advice on potential acquisitions, including introducing the
Company to HomeBase Work Solutions Ltd. and identifying potential customers.

During the year ended March 31, 2000, the Company paid consulting fees
totaling $120,000 and accrued an additional $40,000 to George Shafran, a
director of the Company, for consulting services related to business

40
<PAGE> 49

development and advice on potential acquisitions, including introducing the
Company to an acquisition candidate and attending numerous sales calls with
potential customers. The Company will continue to pay a monthly consulting fee
while services are being rendered.

During the year ended March 31, 2000, the Company paid incentive
compensation fees to Darcy Galvon, its Co-Chairman of the Board, of Cdn $140,000
(or $95,160 in U.S. dollars as of March 31, 2000) in connection with the
Company's acquisition of HomeBase Work Solutions. During the year ended March
31, 2000 the Company paid consulting fees to 2Inc., a company owned 50% by Darcy
Galvon, in the amount of Cdn $86,000 (or $58,456 in U.S. dollars as of March 31,
2000) and accrued an additional Cdn $54,000 (or $36,705 in U.S. dollars as of
March 31, 2000) for consulting services rendered by Mr. Galvon. The Company will
continue to pay a monthly consulting fee while such services are being rendered.

From July 29, 1997 to March 31, 1999, the Company received cash advances
from View Media, a company controlled by Don Jeffrey, a shareholder beneficially
owning approximately 10.5% of the outstanding shares of the Company, totaling
approximately $109,000. The Company repaid such advances prior to June 30, 1999.

Darcy Galvon, Co-Chairman of the Board of the Company, is a Director of
Facet Petroleum Solutions, Inc. Pursuant to a licensing and distribution
agreement dated March 30, 1999 between HomeBase Work Solutions and Facet
Petroleum Solutions Inc., HomeBase Work Solutions acquired the exclusive right
in the telework market to distribute Facet Petroleum's Telework Operational Data
Store software for a period of two years in consideration for 6,910 common
shares of HomeBase valued at Cdn $200,678 (or $139,000 in U.S. dollars as of
December 31, 1999). Facet Petroleum received 25,000 shares of Company Common
Stock in exchange for the 6,910 HomeBase Work Solutions shares as a result of
the acquisition of HomeBase Work Solutions by the Company on May 13, 1998.

Jeffrey S. Spindler, a member of the Company Board and the audit committee
of the Company Board, is a partner of Olshan Grundman Frome Rosenzweig & Wolosky
LLP, counsel to the Company ("Company Counsel"). During the fiscal year ended
March 31, 2000, the Company paid legal fees totalling $304,876 and accrued an
additional $223,626 of legal fees to Company Counsel for legal services rendered
to the Company and paid $38,576 to Company Counsel with respect to disbursements
made and expenses incurred by Company Counsel in the course of its
representation of the Company.

CERTAIN CLAIMS AGAINST INFOCAST

N.M. Rothschild & Sons ("Rothschild"), formerly a financial consultant to
the Company, has verbally asserted that it is entitled to compensation in the
amount of 3% of the aggregate consideration paid by InfoCast to acquire i360
under an agreement with the Company in the event the Merger is consummated. The
Company does not believe that it is obligated to Rothschild for any compensation
in connection with the Merger. As of the date of this Proxy Statement, the
Company is not aware of any actions taken by Rothschild with respect to this
claim other than to advise the Company of its position with respect thereto.

PROPOSAL NO. 2

APPROVAL OF ADOPTION OF THE 2000 STOCK OPTION PLAN

The Company Board has unanimously approved for submission to a vote of the
shareholders a proposal to adopt the 2000 Stock Option Plan (the "2000 Plan").
The purpose of the 2000 Plan is to retain in the employ of and as directors,
consultants and advisors to the Company persons of training, experience and
ability, to attract new employees, directors, advisors and consultants whose
services are considered valuable, to encourage the sense of proprietorship and
to stimulate the active interest of such persons in the development and
financial success of the Company and its subsidiaries. As the Company continues
to develop, it believes that grants of options and other forms of equity
participation will become an increasingly important means to retain and
compensate employees, directors, advisors and consultants.

41
<PAGE> 50

Each option granted pursuant to the 2000 Plan shall be designated at the
time of grant as either an "incentive stock option" or as a "nonqualified stock
option." A summary of the significant provisions of the 2000 Plan is set forth
below. The full text of the 2000 Plan is set forth as Annex E to this Proxy
Statement. This discussion of the 2000 Plan is qualified in its entirety by
reference to Annex E.

ADMINISTRATION OF THE PLAN

The 2000 Plan will be administered by the Company Board or a committee
consisting of two or more directors who are "Non-Employee Directors" (as such
term is defined in Exchange Act Rule 16b-3) and "Outside Directors" (as such
term is defined in Section 162(m) of the Code) (the "Committee"). All references
to the term "Committee" herein shall be deemed references to the Company Board
or the Committee, whichever is administering the 2000 Plan. The Committee
determines to whom among those eligible, and the time or times at which, options
will be granted, the number of shares to be subject to options, the duration of
options, any conditions to the exercise of options, and the manner in and price
at which options may be exercised. In making such determinations, the Committee
may take into account the nature and period of service of eligible persons,
their level of compensation, their past, present and potential contributions to
the Company and such other factors as the Committee in its discretion deems
relevant.

The Committee is authorized to amend, suspend or terminate the 2000 Plan,
except that it is not authorized without shareholder approval (except with
regard to adjustments resulting from changes in capitalization) to (i)
materially increase the number of shares that may be issued under the 2000 Plan,
except as is provided in Section 8 of the 2000 Plan; (ii) materially increase
the benefits accruing to the option holders under the 2000 Plan; (iii)
materially modify the requirements as to eligibility for participation in the
2000 Plan; (iv) decrease the exercise price of an incentive stock option to less
than 100% of the Fair Market Value per share of Company Common Stock on the date
of grant thereof, or decrease the exercise price of a non-qualified stock option
to less than 80% of the Fair Market Value per share of Company Common Stock on
the date of grant thereof; or (v) extend the term of any option beyond that
provided for in Section 5 of the 2000 Plan.

Unless the 2000 Plan is terminated earlier by the Committee, it will
terminate on June 13, 2010.

COMMON STOCK SUBJECT TO THE 2000 PLAN

The 2000 Plan provides that options may be granted with respect to a total
of 2,000,000 shares of Company Common Stock. The maximum number of shares that
can be subject to options granted under the 2000 Plan to any individual in any
calendar year shall not exceed 800,000. Under certain circumstances involving a
change in the number of shares of Company Common Stock, such as a stock split,
stock consolidation or payment of a stock dividend, the class and aggregate
number of shares of Company Common Stock in respect of which options may be
granted under the 2000 Plan, the class and number of shares subject to each
outstanding option and the option price per share will be proportionately
adjusted. In addition, if the Company is involved in a merger, consolidation,
dissolution, liquidation or upon a transfer of substantially all of the assets
or more than 80% of the outstanding Company Common Stock, the options granted
under the 2000 Plan will be adjusted or, under certain conditions, will
terminate, subject to the right of the option holder to exercise his option or a
comparable option substituted at the discretion of the Company prior to such
event. If any option expires or terminates for any reason, without having been
exercised in full, the unpurchased shares subject to such option will be
available again for the purposes of the 2000 Plan.

PARTICIPATION

Any employee, officer or director of, and any consultant or advisor to, the
Company or any of its subsidiaries shall be eligible to receive stock options
under the 2000 Plan. Only employees of the Company or its subsidiaries shall be
eligible to receive incentive stock options.

42
<PAGE> 51

OPTION PRICE

The exercise price of each option is determined by the Committee, but may
not be less than 100% of the Fair Market Value (as defined in the 2000 Plan) of
the shares of Company Common Stock covered by the option on the date the option
is granted in the case of an incentive stock option, nor less than 80% of the
Fair Market Value of the shares of Company Common Stock covered by the option on
the date the option is granted in the case of a non-statutory stock option. If
an incentive stock option is to be granted to an employee who owns over 10% of
the total combined voting power of all classes of the Company's capital stock,
then the exercise price may not be less than 110% of the Fair Market Value of
the Company Common Stock covered by the option on the date the option is
granted.

TERMS OF OPTIONS

The Committee shall, in its discretion, fix the term of each option,
provided that the maximum term of each option shall be 10 years. Incentive stock
options granted to an employee who owns over 10% of the total combined voting
power of all classes of stock of the Company shall expire not more than five
years after the date of grant. The 2000 Plan provides for the earlier expiration
of options of a participant in the event of certain terminations of employment
or engagement. In the event of any merger, reorganization, consolidation,
recapitalization, stock dividend, or other change in corporate structure
affecting the common stock of the Company, the Compensation Committee shall make
an appropriate and equitable adjustment in the number and kind of shares
reserved for issuance under the 2000 Plan and in the number and option price of
shares subject to outstanding options granted under the 2000 Plan, to the end
that after such event each option holder's proportionate interest shall be
maintained as immediately before the occurrence of such event.

RESTRICTIONS ON GRANT AND EXERCISE

Generally, an option may not be transferred or assigned other than by will
or the laws of descent and distribution or pursuant to a qualified domestic
relations order and, during the lifetime of the option holder, may be exercised
solely by him. The aggregate Fair Market Value (determined at the time the
incentive stock option is granted) of the shares as to which an employee may
first exercise incentive stock options in any one calendar year under all
incentive stock option plans of the Company and its subsidiaries may not exceed
$100,000. The Committee may impose any other conditions to exercise as it deems
appropriate.

REGISTRATION OF SHARES

The Company may file a registration statement under the Securities Act,
with respect to the Common Stock issuable pursuant to the 2000 Plan subsequent
to the approval of the 2000 Plan by the Company's shareholders.

RULE 16B-3 COMPLIANCE

In all cases, the terms, provisions, conditions and limitations of the 2000
Plan shall be construed and interpreted consistent with the provisions of Rule
16b-3 of the Exchange Act.

TAX TREATMENT OF INCENTIVE STOCK OPTIONS

In general, no taxable income for Federal income tax purposes will be
recognized by an option holder upon receipt or exercise of an incentive stock
option and the Company will not then be entitled to any tax deduction. Assuming
that the option holder does not dispose of the option shares before the
expiration of the longer of (i) two years after the date of grant, or (ii) one
year after the transfer of the option shares, upon disposition, the option
holder will recognize capital gain equal to the difference between the sale
price on disposition and the exercise price.

If, however, the option holder disposes of his option shares prior to the
expiration of the required holding periods, he will recognize ordinary income
for Federal income tax purposes in the year of disposition equal to the lesser
of (i) the difference between the fair market value of the shares at date of
exercise and the exercise

43
<PAGE> 52

price, or (ii) the difference between the sale price upon disposition and the
exercise price. Any additional gain on such disqualifying disposition will be
treated as capital gain. In addition, if such a disqualifying disposition is
made by the option holder, the Company will be entitled to a deduction equal to
the amount of ordinary income recognized by the option holder provided such
amount constitutes an ordinary and reasonable expense of the Company.

TAX TREATMENT OF NONQUALIFIED STOCK OPTIONS

No taxable income will be recognized by an option holder upon receipt of a
non-statutory stock option, and the Company will not be entitled to a tax
deduction for such grant.

Upon the exercise of a nonqualified stock option, the option holder will
include in taxable income for Federal income tax purposes the excess in value on
the date of exercise of the shares acquired upon exercise of the nonqualified
stock option over the exercise price. Upon a subsequent sale of the shares, the
option holder will derive short-term or long-term gain or loss, depending upon
the option holder's holding period for the shares, commencing upon the exercise
of the option, and upon the subsequent appreciation or depreciation in the value
of the shares.

The Company generally will be entitled to a corresponding deduction at the
time that the participant is required to include the value of the shares in his
income.

WITHHOLDING OF TAX

The Company is permitted to deduct and withhold amounts required to satisfy
its withholding tax liabilities with respect to its employees.

OPTION GRANTS

Options to purchase 350,000 shares of Company Common Stock at an exercise
price of $4.00 per share have been granted pursuant to the 2000 Plan, subject to
shareholder approval of the 2000 Plan.

REQUIRED VOTE

The affirmative vote of the holders of a majority of the Company Common
Stock present, in person or by proxy, is required for approval of the adoption
of the 2000 Plan. An abstention, withholding of authority to vote or broker
non-vote, therefore, will not have the same legal effect as an "against" vote
and will not be counted in determining whether the proposal has received the
requisite shareholder vote.

RECOMMENDATION OF THE BOARD OF DIRECTORS

THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS A VOTE "FOR" THE APPROVAL
OF THE ADOPTION OF THE 2000 PLAN.

OTHER BUSINESS

So far as it is known, there is no business other than that described above
to be presented for action by the shareholders at the forthcoming Meeting, but
it is intended that Proxies will be voted upon any other matters and proposals
that may legally come before the Meeting, or any adjustments thereof, in
accordance with the discretion of the persons named therein.

By Order of the Board of Directors

/s/ Herve Seguin
HERVE SEGUIN
Chief Financial Officer and Secretary
July 21, 2000
44
<PAGE> 53

INDEX TO FINANCIAL STATEMENTS

<TABLE>
<S> <C>
INFOCAST CORPORATION
Report of Independent Auditors............................ F-2
Consolidated Balance Sheets............................... F-3
Consolidated Statements of Operations and Comprehensive
Loss................................................... F-4
Consolidated Statements of Cash Flows..................... F-5
Consolidated Statements of Changes in Stockholders'
Equity................................................. F-6
Notes to Consolidated Financial Statements................ F-8
HOMEBASE WORK SOLUTIONS LTD.
Report of Independent Auditors............................ F-28
Balance Sheets............................................ F-29
Statements of Loss and Accumulated Development Stage
Deficits............................................... F-30
Statements of Cash Flows.................................. F-31
Notes to Consolidated Financial Statements................ F-32
i360 INC.
Report of Independent Auditors............................ F-37
Consolidated Balance Sheet................................ F-38
Consolidated Statement of Operations...................... F-39
Consolidated Statement of Changes in Stockholders'
Equity................................................. F-40
Consolidated Statement of Cash Flows...................... F-41
Notes to Consolidated Financial Statements................ F-42
Pro Forma Consolidated Financial Statements of InfoCast
Corporation............................................... F-47
</TABLE>

F-1
<PAGE> 54

AUDITORS' REPORT

To the Stockholders of InfoCast Corporation

We have audited the consolidated balance sheets of InfoCast Corporation
[formerly Virtual Performance Systems Inc.] [a development stage company] as of
March 31, 2000 and March 31, 1999 and the related consolidated statements of
operations and comprehensive loss, cash flows and changes in stockholders'
equity for the year ended March 31, 2000, the three month period ended March 31,
1999, the year ended December 31, 1998, the 156 day period ended December 31,
1997 and the period from July 29, 1997 to March 31, 2000. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
an audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe our audits provide a reasonable basis for our
opinion.

In our opinion, based on our audits, the consolidated financial statements
referred to above present fairly, in all material respects, the financial
position of InfoCast Corporation as at March 31, 2000 and March 31, 1999 and the
results of its operations and its cash flows for the year ended March 31, 2000,
the three month period ended March 31, 1999, the year ended December 31, 1998,
the 156 day period ended December 31, 1997 and the period from July 29, 1997 to
March 31, 2000 in conformity with accounting principles generally accepted in
the United States.

/s/ ERNST & YOUNG LLP
--------------------------------------
Chartered Accountants

Toronto, Canada,
May 5, 2000.

F-2
<PAGE> 55

INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

CONSOLIDATED BALANCE SHEETS
[U.S. DOLLARS, U.S. GAAP]

<TABLE>
<CAPTION>
AS OF AS OF
MARCH 31, MARCH 31,
2000 1999
------------ -----------
<S> <C> <C>
ASSETS
Current
Cash and cash equivalents................................... $ 3,637,931 $ 3,092,445
Short-term equity investment [note 8]....................... 3,900,000 --
Accounts receivable......................................... 275,283 258,244
Prepaid expenses and other [note 11]........................ 324,835 21,404
------------ -----------
Total current assets.............................. 8,138,049 3,372,093
------------ -----------
Deferred agency fee [note 9]................................ 604,583 --
Capital assets, net [note 5]................................ 3,152,983 107,392
Goodwill, net............................................... 4,812,380 --
Distribution and licensing rights, net [note 4]............. 2,975,000 500,000
Intellectual property, net [note 3]......................... 14,886,486 45,591
------------ -----------
34,569,481 4,025,076
============ ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current
Accounts payable and accrued liabilities.................... 1,814,538 354,694
Current portion of obligations under capital leases [note
7]........................................................ 479,813 --
Due to related parties [note 6]............................. 20,392 177,270
------------ -----------
Total current liabilities......................... 2,314,743 531,964
------------ -----------
Long-term
Convertible debentures [note 9]............................. 3,500,000 --
Obligations under capital leases [note 7]................... 802,836 --
Deferred income taxes....................................... 5,656,895 --
------------ -----------
Total long-term liabilities....................... 9,959,731 --
------------ -----------
Total liabilities................................. 12,274,474 531,964
------------ -----------
Stockholders' equity
Common stock
[100,000,000 authorized and 24,571,336 issued and
outstanding at
March 31, 2000, 18,172,333 at March 31, 1999]............. 23,071 16,672
Additional paid-in capital.................................. 57,933,723 16,925,017
Deferred compensation....................................... (1,677,491) (9,858,932)
Warrants.................................................... 1,007,875 --
Accumulated other comprehensive income (loss)............... (237,033) 14,309
Accumulated development stage deficit....................... (34,755,138) (3,603,954)
------------ -----------
Total stockholders' equity........................ 22,295,007 3,493,112
------------ -----------
34,569,481 4,025,076
============ ===========
</TABLE>

See accompanying notes
F-3
<PAGE> 56

INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
[U.S. DOLLARS, U.S. GAAP]

<TABLE>
<CAPTION>
PERIOD FROM CUMULATIVE
THREE MONTHS THREE MONTHS JULY 29, 1997 FROM
YEAR ENDED ENDED ENDED YEAR ENDED (INCEPTION) TO INCEPTION TO
MARCH 31, MARCH 31, MARCH 31, DECEMBER 31, DECEMBER 31, MARCH 31,
2000 1999 1998 1998 1997 2000
------------ ------------ ------------ ------------ -------------- ------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
REVENUE....................... $ 305,754 $ -- $ 43,446 $ 43,446 $ 3,508 $ 352,708
EXPENSES
General, administrative and
selling, excluding stock
option compensation......... 7,391,128 635,334 42,494 375,302 47,954 8,449,718
Stock option compensation
[note 8].................... 13,351,908 2,256,938 -- -- -- 15,608,846
Research and development,
excluding stock option
compensation................ 5,186,265 162,914 19,703 88,180 51,257 5,488,616
Interest and loan fees [note
9].......................... 1,913,482 23,562 -- -- -- 1,937,044
Amortization.................. 4,315,180 4,144 -- -- -- 4,319,324
Depreciation.................. 495,401 5,507 870 3,836 458 505,202
------------ ----------- -------- --------- ---------- ------------
32,653,364 3,088,399 63,067 467,318 99,669 36,308,750
------------ ----------- -------- --------- ---------- ------------
Loss from operations before
the following............... (32,347,610) (3,088,399) (19,621) (423,872) (96,161) (35,956,042)
Interest income............... 132,057 4,478 -- -- -- 136,535
------------ ----------- -------- --------- ---------- ------------
Equity in loss of joint
venture [note 12]........... (164,736) -- -- -- -- (164,736)
------------ ----------- -------- --------- ---------- ------------
Loss before income taxes...... (32,380,289) (3,083,921) (19,621) (423,872) (96,161) (35,984,243)
Deferred income taxes......... (1,229,105) -- -- -- -- (1,229,105)
------------ ----------- -------- --------- ---------- ------------
Net loss for the period....... (31,151,184) (3,083,921) (19,621) (423,872) (96,161) (34,755,138)
Unrealized loss on short-term
equity investment........... (287,500) -- -- -- -- (287,500)
Translation adjustment........ 36,158 (6,614) (1,227) 19,291 1,632 50,467
------------ ----------- -------- --------- ---------- ------------
Comprehensive loss for the
period...................... (31,402,526) (3,090,535) (20,848) (404,581) (94,529) (34,992,171)
------------ ----------- -------- --------- ---------- ------------
Weighted average number of
shares outstanding.......... 22,655,810 11,583,995 41 768,301 41 9,974,536
------------ ----------- -------- --------- ---------- ------------
Basic and diluted loss per
share....................... (1.37) (0.27) (478.56) (0.55) (2,345.39) (3.48)
------------ ----------- -------- --------- ---------- ------------
Stock option compensation
expense related to General,
administrative and
selling..................... 9,594,046 1,452,549 -- -- -- 11,046,595
Research and development...... 3,757,861 804,389 -- -- -- 4,562,250
------------ ----------- -------- --------- ---------- ------------
</TABLE>

See accompanying notes
F-4
<PAGE> 57

INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

CONSOLIDATED STATEMENTS OF CASH FLOWS
[U.S. DOLLARS, U.S. GAAP]

<TABLE>
<CAPTION>
PERIOD FROM CUMULATIVE
THREE MONTHS THREE MONTHS JULY 29, 1997 FROM
YEAR ENDED ENDED ENDED YEAR ENDED [INCEPTION] TO INCEPTION TO
MARCH 31, MARCH 31, MARCH 31, DECEMBER 31, DECEMBER 31, MARCH 31,
2000 1999 1998 1998 1997 2000
------------ ------------ ------------ ------------ -------------- ------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
OPERATING ACTIVITIES
Net loss for the period............... $(31,151,184) $(3,083,921) $(19,621) $(423,872) $(96,161) $(34,755,138)
Add (deduct) items not affecting cash
Stock option compensation........... 13,351,908 2,256,938 -- -- -- 15,608,846
Common stock issued for services.... 439,820 10,180 -- -- -- 450,000
Warrants issued for services........ 781,075 -- -- -- -- 781,075
Common stock issued to Applied
Courseware Technology (A.C.T.)
Inc. ............................. 1,337,500 -- -- -- -- 1,337,500
Write-off of in-process research and
development....................... 19,000 -- -- -- -- 19,000
Write-off of Applied Courseware
Technology (A.C.T.) Inc. loan..... 98,685 -- -- -- -- 98,685
Non-cash interest expense........... 1,913,482 -- -- -- -- 1,913,482
Equity in loss of joint venture..... 164,736 -- -- -- -- 164,736
Deferred income taxes............... (1,229,105) -- -- -- -- (1,229,105)
Amortization........................ 4,315,180 4,144 -- -- -- 4,319,324
Depreciation........................ 495,401 5,507 870 3,836 458 505,202
------------ ----------- -------- --------- -------- ------------
(9,463,502) (807,152) (18,751) (420,036) (95,703) (10,786,393)
Changes in non-cash working capital
balances
Accounts receivable................. (197,371) (9,723) (19,501) 6,593 (16,286) (216,787)
Prepaid expenses and other.......... (301,964) (6,179) (61) (15,187) (38) (323,368)
Bank overdraft...................... -- -- 9,263 -- -- --
Accounts payable and accrued
liabilities....................... 1,298,048 173,306 10,999 103,591 13,518 1,588,463
Due from InfoCast [the acquired
entity] prior to acquisition...... -- -- -- (25,020) -- (25,020)
------------ ----------- -------- --------- -------- ------------
Cash used in operating activities..... (8,664,789) (649,748) (18,051) (350,059) (98,509) (9,763,105)
------------ ----------- -------- --------- -------- ------------
INVESTING ACTIVITIES
Purchase of capital assets............ (2,024,070) (93,659) (325) (11,644) (12,412) (2,141,785)
Distribution rights................... (2,475,000) (500,000) -- -- -- (2,975,000)
Due from Homebase Work Solutions
Ltd................................. -- (99,529) -- -- -- (99,529)
Acquisition of Homebase Work Solutions
Ltd................................. 50,667 -- -- -- -- 50,667
Investment in joint venture........... (171,720) -- -- -- -- (171,720)
Due from Applied Courseware Technology
(A.C.T.) Inc. ...................... -- (139,299) -- -- -- (139,299)
Acquisition of InfoCast Corporation... -- 87 -- -- -- 87
------------ ----------- -------- --------- -------- ------------
Cash used in investing activities..... (4,620,123) (832,400) (325) (11,644) (12,412) (5,476,579)
------------ ----------- -------- --------- -------- ------------
FINANCING ACTIVITIES
Increase in note payable to InfoCast
[the acquired entity]............... -- -- -- 250,000 -- 250,000
Increase (decrease) in due to related
parties............................. (177,270) (95,755) 19,346 114,476 109,545 (49,004)
Repayment of capital lease
obligations......................... (213,808) -- -- -- -- (213,808)
Receipt of short-term unsecured
loan................................ -- 400,000 -- 70,000 -- 470,000
Payment of short-term unsecured
loan................................ -- (400,000) -- (70,000) -- (470,000)
Cash advance from InfoCast [the
acquired entity] prior to
acquisition......................... -- 146,900 -- -- -- 146,900
Cash proceeds from convertible
debentures, net..................... 3,225,000 -- -- -- -- 3,225,000
Cash proceeds from issuance of share
capital, net........................ 10,970,537 4,505,508 -- 2,373 45 15,478,463
------------ ----------- -------- --------- -------- ------------
Cash provided by financing
activities.......................... 13,804,459 4,556,653 19,346 366,849 109,590 18,837,551
------------ ----------- -------- --------- -------- ------------
Net increase (decrease) in cash during
the period.......................... 519,547 3,074,505 970 5,146 (1,331) 3,597,867
Effects of foreign exchange rate
changes on cash balances............ 25,939 (7,655) (1,271) 20,148 1,632 40,064
Cash and cash equivalents, beginning
of period........................... 3,092,445 25,595 301 301 -- --
------------ ----------- -------- --------- -------- ------------
Cash and cash equivalents, end of
period.............................. 3,637,931 3,092,445 -- 25,595 301 3,637,931
============ =========== ======== ========= ======== ============
Supplemental cash flow information
Interest and lending fees paid during
the period.......................... -- 23,562 -- -- -- 23,562
Capital lease obligation assumed
during the period................... 1,496,466 -- -- -- -- 1,496,466
Fair value of acquisitions acquired
through share issuances during the
period.............................. 17,000,000 307,688 -- -- -- 17,307,688
============ =========== ======== ========= ======== ============
</TABLE>

F-5
<PAGE> 58

INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
[U.S. DOLLARS, U.S. GAAP]
<TABLE>
<CAPTION>
ACCUMULATED
COMMON COMMON STOCK ADDITIONAL OTHER ACCUMULATED
SHARES ISSUED AND PAID-IN DEFERRED COMPREHENSIVE DEVELOPMENT
# OUTSTANDING CAPITAL COMPENSATION WARRANTS LOSS STAGE DEFICIT
---------- ------------ ----------- ------------ ---------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Deemed common shares
issued for
intellectual
properties [note 1]... 14 $ -- $ 25 $ -- $ -- $ -- $ --
Deemed common shares
issued for cash [note
1].................... 27 -- 45 -- -- -- --
Net loss for the
period................ -- -- -- -- -- -- (96,161)
Translation
adjustment............ -- -- -- -- -- 1,632 --
---------- ------- ----------- ------------ ---------- ------------ ------------
Deemed balance as of
December 31, 1997..... 41 -- 70 -- -- 1,632 (96,161)
Deemed common shares
issued for cash [note
1].................... 1,499,959 -- 2,373 -- -- -- --
Net loss for the
period................ -- -- -- -- -- -- (423,872)
Translation
adjustment............ -- -- -- -- -- 19,291 --
---------- ------- ----------- ------------ ---------- ------------ ------------
Deemed balance as of
December 31, 1998..... 1,500,000 -- 2,443 -- -- 20,923 (520,033)
Acquisition of InfoCast
by VPS [note 1]....... 13,580,000 13,580 294,108 -- -- -- --
Common shares issued for
cash.................. 3,032,336 3,032 4,545,468 -- -- -- --
Share issuance costs.... -- -- (42,992) -- -- -- --
Common shares issued for
consulting services... 60,000 60 337,740 (337,800) -- -- --
Granting of stock
options............... -- -- 11,788,250 (11,788,250) -- -- --
Amortization of deferred
compensation.......... -- -- -- 2,267,118 -- -- --
Net loss for the
period................ -- -- -- -- -- -- (3,083,921)
Translation
adjustment............ -- -- -- -- -- (6,614) --
---------- ------- ----------- ------------ ---------- ------------ ------------
Balance as of March 31,
1999.................. 18,172,336 16,672 16,925,017 (9,858,932) -- 14,309 (3,603,954)
========== ======= =========== ============ ========== ============ ============

TOTAL
STOCKHOLDERS'
EQUITY
-------------
<S> <C>
Deemed common shares
issued for
intellectual
properties [note 1]... $ 25
Deemed common shares
issued for cash [note
1].................... 45
Net loss for the
period................ (96,161)
Translation
adjustment............ 1,632
-----------
Deemed balance as of
December 31, 1997..... (94,459)
Deemed common shares
issued for cash [note
1].................... 2,373
Net loss for the
period................ (423,872)
Translation
adjustment............ 19,291
-----------
Deemed balance as of
December 31, 1998..... (496,667)
Acquisition of InfoCast
by VPS [note 1]....... 307,688
Common shares issued for
cash.................. 4,548,500
Share issuance costs.... (42,992)
Common shares issued for
consulting services... --
Granting of stock
options............... --
Amortization of deferred
compensation.......... 2,267,118
Net loss for the
period................ (3,083,921)
Translation
adjustment............ (6,614)
-----------
Balance as of March 31,
1999.................. 3,493,112
===========
</TABLE>

F-6
<PAGE> 59
<TABLE>
<CAPTION>
ACCUMULATED
COMMON COMMON STOCK ADDITIONAL OTHER ACCUMULATED
SHARES ISSUED AND PAID-IN DEFERRED COMPREHENSIVE DEVELOPMENT
# OUTSTANDING CAPITAL COMPENSATION WARRANTS LOSS STAGE DEFICIT
---------- ------------ ----------- ------------ ---------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance as of March 31,
1999.................. 18,172,336 16,672 16,925,017 (9,858,932) -- 14,309 (3,603,954)
Deemed common shares
issued for acquisition
of Homebase Work
Solutions Ltd......... 3,400,000 3,400 16,996,600 -- -- -- --
Common shares issued for
cash and marketable
securities............ 2,999,000 2,999 17,956,501 -- -- -- --
Share issuance costs --
cash.................. -- -- (1,563,963) -- -- -- --
Share issuance costs --
warrants.............. -- -- (226,800) -- 226,800 -- --
Issuance of convertible
debentures with
warrants.............. -- -- 2,243,065 -- -- -- --
Warrants issued for
consulting services... -- -- -- -- 643,875 -- --
Warrants issued to
stockholders.......... -- -- -- -- 137,200 -- --
Adjustments resulting
from revaluation of
stock options granted
to consultants in
previous periods...... -- -- 963,557 -- -- -- --
Adjustments resulting
from revaluation of
common shares granted
to consultants in
previous periods...... -- $ -- $ 112,200 $ -- $ -- $ -- $ --
Adjustment to joint
venture investment to
reflect dilution of
ownership interest.... -- -- (6,984) -- -- -- --
Granting of stock
options............... -- -- 4,803,780 -- -- -- --
Cancellation of stock
options............... -- -- (269,250) -- -- -- --
Amortization of deferred
compensation.......... -- -- -- 8,181,441 -- -- --
Net loss for the
period................ -- -- -- -- -- -- (31,151,184)
Unrealized loss on
short-term equity
investment............ -- -- -- -- -- (287,500) --
Translation
adjustment............ -- -- -- -- -- 36,158 --
---------- ------- ----------- ------------ ---------- ------------ ------------
Balance as of March 31,
2000.................. 24,571,336 23,071 57,933,723 (1,677,491) 1,007,875 (237,033) (34,755,138)
========== ======= =========== ============ ========== ============ ============

TOTAL
STOCKHOLDERS'
EQUITY
-------------
<S> <C>
Balance as of March 31,
1999.................. 3,493,112
Deemed common shares
issued for acquisition
of Homebase Work
Solutions Ltd......... 17,000,000
Common shares issued for
cash and marketable
securities............ 17,959,500
Share issuance costs --
cash.................. (1,563,963)
Share issuance costs --
warrants.............. --
Issuance of convertible
debentures with
warrants.............. 2,243,065
Warrants issued for
consulting services... 643,875
Warrants issued to
stockholders.......... 137,200
Adjustments resulting
from revaluation of
stock options granted
to consultants in
previous periods...... 963,557
Adjustments resulting
from revaluation of
common shares granted
to consultants in
previous periods...... $ 112,200
Adjustment to joint
venture investment to
reflect dilution of
ownership interest.... (6,984)
Granting of stock
options............... 4,803,780
Cancellation of stock
options............... (269,250)
Amortization of deferred
compensation.......... 8,181,441
Net loss for the
period................ (31,151,184)
Unrealized loss on
short-term equity
investment............ (287,500)
Translation
adjustment............ 36,158
-----------
Balance as of March 31,
2000.................. 22,295,007
===========
</TABLE>

The accumulated other comprehensive loss balance as of March 31, 2000
includes a net accumulated translation adjustment gain of $50,467 and an
accumulated unrealized loss on short-term equity securities of $287,500.

F-7
<PAGE> 60

INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
[U.S. DOLLARS EXCEPT WHERE OTHERWISE NOTED]

MARCH 31, 2000

1. BASIS OF ACCOUNTING

NATURE OF OPERATIONS AND CONTINUING ENTITY

These consolidated financial statements are the continuing financial
statements of Virtual Performance Systems Inc. ["VPS"] [a development stage
company], an Ontario corporation which was incorporated on July 29, 1997. VPS
had a 100% interest in, and subsequently amalgamated with, Cheltenham
Technologies Corporation, an Ontario corporation. VPS has a 100% interest in
Cheltenham Interactive Corporation ["Cheltenham Interactive"], an inactive
Ontario corporation, and Cheltenham Technologies (Bermuda) Corporation
["Cheltenham Bermuda"], a Barbados corporation which owns certain intellectual
properties. On January 29, 1999, VPS acquired the net assets of InfoCast
Corporation [formerly Grant Reserve Corporation] ["InfoCast"], a United States
non-operating company traded on the NASDAQ OTC Bulletin Board which had a 100%
interest in InfoCast Canada Corporation ["InfoCast Canada"]. After the
acquisition, VPS continued under the name of InfoCast Corporation.

InfoCast, InfoCast Canada, VPS, Cheltenham Interactive and Cheltenham
Bermuda are collectively referred to as the "Company". The Company is a
development stage technology company that has developed the infrastructure to
enable the Company to host both their own customized and third-party software
applications that can be accessed remotely by businesses and their employees.

The Company's primary operational focus as outlined in its business plan
entails significant investment in developing, deploying and marketing electronic
commerce enabling application solutions.

The aggregate future capital requirements to support this investment are
expected to be substantially funded from external resources including issuing
equity and or debt. There can be no assurance that any financing will be
available on terms acceptable to the Company or at all.

The Company believes that its working capital position as well as the
additional net convertible debenture proceeds of $2,325,000 received in April
2000 will be sufficient to support the Company's growth for approximately the
next six to nine months. In the event that additional financings are not
completed and expected revenues and cash flows are not achieved, the Company
intends to curtail its development plans and reduce expense levels significantly
at the appropriate time. In such event the Company believes that its current
cash reserves will support limited activities until May 2001.

The Company is currently seeking to raise additional funds through private
or public financing, strategic or other relationships.

The functional currency of VPS, Cheltenham Interactive, Cheltenham Bermuda
and InfoCast Canada is the Canadian dollar. However, for reporting purposes, the
Company has adopted the United States dollar as its reporting currency.
Accordingly, the Canadian dollar balance sheets of these companies have been
translated into United States dollars at the rates of exchange at the respective
period ends, while transactions during the periods and share capital amounts
have been translated at the weighted average rates of exchange for the
respective periods and the exchange rate at the date of the transaction
respectively. Gains and losses arising from these translation adjustments are
included in comprehensive loss.

REVERSE ACQUISITION OF INFOCAST CORPORATION

Pursuant to a share purchase agreement dated January 29, 1999, the
shareholders of VPS sold their 100% interest in VPS to InfoCast in consideration
for 1,500,000 exchangeable shares of InfoCast Canada, a wholly-

F-8
<PAGE> 61
INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

owned subsidiary of InfoCast. The InfoCast Canada exchangeable shares are
convertible into common shares of InfoCast at no additional consideration. In
addition, the shareholders of VPS also purchased a further 9 million common
shares of InfoCast from InfoCast's former controlling shareholder, Sheridan
Reserve Incorporated, in consideration for a nominal cash amount. As a result of
these two transactions, the shareholders of VPS effectively acquired 10,500,000
common shares of InfoCast which represents a controlling interest of
approximately 70% [60% excluding the exchangeable shares]. This transaction is
considered an acquisition of InfoCast [the accounting subsidiary/legal parent]
by VPS [the accounting parent/legal subsidiary] and has been accounted for as a
purchase of the net assets of InfoCast by VPS in these consolidated financial
statements because InfoCast had no business operations or operating assets at
the time of the acquisition.

These consolidated financial statements are issued under the name of
InfoCast, but are a continuation of the financial statements of the accounting
acquirer, VPS. VPS's assets and liabilities are included in the consolidated
financial statements at their historical carrying amounts. Figures presented to
January 29, 1999 are those of VPS. For purposes of the acquisition, the fair
value of the net assets of InfoCast of $307,688 is ascribed to the 13,580,000
previously outstanding common shares of InfoCast deemed to be issued in the
acquisition as follows:

<TABLE>
<S> <C>
Cash........................................................ $ 87
Note receivable from VPS.................................... 396,900
Payable to VPS.............................................. (25,020)
Accounts payable............................................ (64,279)
--------
Purchase price.............................................. $307,688
========
</TABLE>

Prior to the acquisition on January 29, 1999, the deemed number of
outstanding shares of InfoCast is equal to the 1,500,000 exchangeable shares of
InfoCast Canada that were issued to the shareholders of VPS in the acquisition.
These shares have been allocated to the changes in the combined issued and
outstanding and additional paid-in-capital common stock of VPS to January 29,
1999 as follows:

<TABLE>
<CAPTION>
DEEMED
INFOCAST VPS
SHARES SHARES
# # AMOUNT
--------- --------- ------
<S> <C> <C> <C>
Issued for intellectual properties [note 3]......... 14 35 $ 25
Issued for cash..................................... 27 65 45
--------- --------- -----
Outstanding as of December 31, 1997................. 41 100 70
Issued for cash..................................... 1,499,959 3,624,000 2,373
--------- --------- -----
Outstanding as of December 31, 1998 and January 29,
1999 prior to acquisition......................... 1,500,000 3,624,100 2,443
--------- --------- -----
</TABLE>

The combined issued and outstanding and additional paid-in-capital common
stock of the continuing consolidated entity as of January 29, 1999 is computed
as follows:

<TABLE>
<S> <C>
Existing share capital of VPS as of January 29, 1999 prior
to acquisition............................................ $ 2,443
Ascribed value of the acquired common shares of InfoCast.... 307,688
--------
Share capital of InfoCast [formerly VPS] as of January 29,
1999...................................................... 310,131
--------
</TABLE>

F-9
<PAGE> 62
INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

The number of outstanding shares of InfoCast [formerly VPS] as of January
29, 1999 is computed as follows:

<TABLE>
<CAPTION>
NUMBER
OF SHARES
#
----------
<S> <C>
Deemed share capital of InfoCast [formerly VPS] as of
January 29, 1999 prior to acquisition..................... 1,500,000
Shares of InfoCast deemed issued by VPS..................... 13,580,000
----------
Shares of InfoCast [formerly VPS] as of January 29, 1999.... 15,080,000
----------
</TABLE>

ACQUISITION OF HOMEBASE WORK SOLUTIONS LTD.

Pursuant to a share purchase agreement dated May 13, 1999, Homebase Work
Solutions Ltd. ["Homebase"] was acquired by the Company in consideration for
3,400,000 exchangeable shares of InfoCast Canada. The InfoCast Canada
exchangeable shares are convertible into InfoCast common stock on a one-for-one
basis at no additional consideration.

As a condition of the closing of the share purchase agreement, the Company
paid $285,480 [Cdn.$420,000] to officers of Homebase during the fiscal year
ended March 31, 2000.

The acquisition has been accounted for using the purchase method. The value
of the acquisition was $17,077,000, which included $77,000 of expenses directly
attributable to the acquisition. For accounting purposes the exchangeable shares
of InfoCast Canada have been valued at $5.00, which is equal to the price per
share received from the June 1999 private placement of the Company's common
stock. The total purchase price of $17,077,000 has been allocated as follows:

<TABLE>
<S> <C>
Cash........................................................ $ 127,667
Other current assets........................................ 13,565
Capital assets.............................................. 20,465
Completed technology........................................ 17,015,000
In-process research and development......................... 19,000
Trademarks.................................................. 853,000
Workforce-in-place.......................................... 253,000
Goodwill.................................................... 5,846,293
Deferred income taxes....................................... (6,886,000)
Accounts payable and accrued liabilities.................... (82,145)
Due to the Company.......................................... (102,845)
-----------
Purchase price.............................................. 17,077,000
-----------
</TABLE>

The completed technology, trademarks, workforce-in-place and goodwill will
be amortized over their respective useful lives of 5 years, 5 years, 3 years and
5 years. The in-process research and development was charged to income
immediately subsequent to the acquisition. The completed technology, trademarks
and workforce-in-place have been classified as intellectual property on the
consolidated balance sheets. The deferred income tax liability was created in
respect of the difference between the accounting and tax basis of the completed
technology, trademarks and workforce-in-place. The identification and the fair
values of the completed technology, in-process research and development,
trademarks and workforce-in-place were determined by management with the
assistance of an independent valuator.

F-10
<PAGE> 63
INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

The completed technology is comprised of Homebase's information hub,
telework and web-enabling technologies, together with the benefits of Homebase's
association with the National Environmental Policy Institute ["NEPI"]. NEPI is a
United States based non-profit environmental lobbyist group that promotes
telework policies in the United States.

The results of operations of Homebase during the post-acquisition 324-day
period ended March 31, 2000 have been consolidated with those of the Company.

The following pro-forma consolidated financial information presents certain
statement of operations data of the Company as if the Company had acquired
Homebase as of April 1, 1998. This pro-forma financial information is not
necessarily indicative of the results that actually would have occurred had the
Company acquired Homebase on the date indicated or which would be obtained in
the future.

<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
MARCH 31, MARCH 31,
2000 1999
------------ -----------
(UNAUDITED) (UNAUDITED)
<S> <C> <C>
Revenue..................................................... $ 305,754 $ 5,153
Net loss for the period..................................... (31,622,119) (7,253,830)
Basic and diluted loss per share............................ (1.37) (1.03)
</TABLE>

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The Company's significant accounting policies are summarized as follows:

Principles of consolidation

These consolidated financial statements include the accounts of InfoCast
and its subsidiaries, all of which are wholly-owned. Intercompany accounts and
transactions have been eliminated upon consolidation.

Cash and cash equivalents

Cash and cash equivalents represent cash and short-term investments with a
maturity date of less than three months when acquired.

Change in year end

Effective for the period ended March 31, 1999, the Company changed its year
end from December 31 to March 31.

Capital assets

Capital assets are recorded at cost less accumulated depreciation. If it is
determined that a capital asset is not recoverable over its estimated useful
life, the capital asset will be written down to its fair value. Maintenance and
repairs are charged to expenses as incurred. Gains and losses on the disposition
of capital

F-11
<PAGE> 64
INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

assets are included in income. Depreciation is provided using the following
annual rates and bases which are expected to amortize the cost of the capital
assets over their estimated useful lives:

<TABLE>
<S> <C>
Computer hardware and software................. 30% declining balance
Furniture and equipment........................ 20% declining balance
Leasehold improvements......................... 20% declining balance
Virtual Call Center solution................... 5 years straight-line
Assets under capital lease..................... straight-line over the term of the lease
</TABLE>

Intellectual property

Acquired intellectual property is recorded at cost and represents
proprietary rights to certain information delivery technologies. The capitalized
costs of the intellectual property is amortized on a straight-line basis over
its estimated useful life. If it is determined that an investment in
intellectual property is not recoverable over its estimated useful life, the
intellectual property will be written down to its fair value.

Distribution and licensing rights

Acquired distribution and licensing rights are recorded at cost. The
capitalized costs of the distribution and licensing rights will be amortized
each period, commencing when the electronically converted products and
educational material are available for distribution and license, at the greater
of [i] the amount calculated based on the straight-line method over the
estimated useful life of 5 years or [ii] the amount calculated based on the
ratio of current gross revenues received from the licensing of the
electronically converted products and the hosting and delivery of educational
material over the sum of the current and future gross revenues anticipated to be
received by licensing the electronically converted products and hosting and
delivering the educational material. If it is determined that the investment in
distribution and licensing rights is not recoverable from estimated sales, the
distribution and licensing rights will be written down to their fair value.

Goodwill

Goodwill is being amortized over its estimated useful life of five years.
The Company assesses each quarter whether there is an other than temporary
impairment of the carrying value of the goodwill based on undiscounted expected
future cash flows. If the Company determines that there is a permanent
impairment of the carrying value of the goodwill, a write-down will occur in
that period.

Revenue recognition

The Company generated revenue from hosting services, consulting services
and the resale of computer hardware. Revenue from hosting services is recognized
when the service is delivered, or over the term of the applicable hosting
services contract. Consulting revenue is recognized at the time such consulting
services are rendered. Revenue generated from the resale of computer hardware is
recognized upon shipment.

Research and development costs

Research and development costs are expensed in the year incurred.

Foreign currency measurement

In preparing the Company's Canadian dollar functional currency financial
statements, United States dollar monetary assets and liabilities are remeasured
in the Company's Canadian dollar functional currency at

F-12
<PAGE> 65
INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

the period end rate of exchange. The statements are then translated into the
Company's United States dollar reporting currency. Transactions in foreign
currency are remeasured at the dollar actual rates of exchange. Foreign currency
remeasurement differences are included in general and administrative expenses.

Stock options

As permitted by FASB Statement No. 123 ["FASB 123"], "Accounting for
Stock-Based Compensation", the Company has adopted the intrinsic value method of
APB 25, "Accounting for Stock Issued to Employees" in respect of stock options
granted to its employees and directors and FASB 123 in respect of stock options
granted to its consultants. The measurement date of options granted to
consultants will be the date the services are completed. For purposes of
recognition of the cost of the options prior to the measurement date such
options are measured at their then current fair value at each interim financial
reporting date.

Income taxes

The Company follows the liability method of providing for income taxes in
accordance with FASB Statement No. 109, "Accounting for Income Taxes".

Basic and diluted loss per common share

Per share amounts have been computed based on the weighted average number
of common shares outstanding each period. The weighted average number of common
shares outstanding prior to the acquisition on January 29, 1999 are based on the
number of VPS common shares outstanding during that period. Diluted loss per
share is calculated by adjusting outstanding shares, assuming any dilutive
effects of options, warrants and convertible securities. For all of the periods
presented, the effect of stock options, warrants, and convertible securities
were not included as the results would be anti-dilutive. Consequently, there is
no difference between the basic and dilutive net loss per share. The weighted
average number potential of common shares from options, warrants and convertible
securities for the year ended March 31, 2000 was 4,042,217 [three months ended
March 31, 1999 -- 1,175,833; three months ended March 31, 1998 -- nil; year
ended December 31, 1998 -- nil; 156 day period ended December 31, 1997 -- nil].

Use of estimates

Management uses estimates and assumptions in preparing consolidated
financial statements in accordance with accounting principles generally accepted
in the United States. Those estimates and assumptions affect the reported
amounts of assets and liabilities, the disclosure of contingent assets and
liabilities and the reported amounts of revenue and expenses. Actual results
could vary from the estimates that are used.

3. INTELLECTUAL PROPERTY

The Company executed a Memorandum of Agreement dated July 31, 1997, whereby
the Company acquired certain intellectual property owned by an officer of the
Company, in consideration for 35 VPS common shares issued at Cdn.$1 per share.
The fair value of the intellectual property is $23 based on the fair value of
the 35 VPS shares issued in consideration thereof. The fair value per share in
respect of the 35 VPS shares issued for the intellectual property is consistent
with the cash proceeds received per share in respect of the other 65 VPS common
shares issued during 1997. The intellectual property purchased pursuant to this
agreement is completed technology and is related to electronic information
delivery algorithms. The Company is not using this electronic information
delivery algorithm and does not plan to use it in the future, therefore, this
intellectual property was written down to nil during the year ended March 31,
2000.

F-13
<PAGE> 66
INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

On November 17, 1998, the Company entered into a Purchase and Sale
Agreement with Advanced Systems Computer Consultants Inc., a company owned by
the officer of the Company noted above, pursuant to which the Company acquired
certain additional intellectual property rights. The intellectual property
purchased pursuant to this agreement is completed technology and relates to
remote banking software. The Company purchased the intellectual property rights
for consideration as follows:

[i] $51,601 [Cdn.$75,000] if the Company becomes a public corporation
and has completed a minimum financing of $2,000,000; and

[ii] $223,600 [Cdn.$325,000] if the purchased remote banking software
generates revenue.

The Company accrued the first installment in its accounts as at March 31,
1999 [$49,712 less accumulated amortization of $4,144] and paid this amount
during the year ended March 31, 2000. The Company is not using this remote
banking software and does not plan to use it in the future, therefore, this
intellectual property was written down to nil during the year ended March 31,
2000.

Acquired intellectual property consists of the following:

<TABLE>
<CAPTION>
2000
---------------------------------------------
ACCUMULATED NET
AMORTIZATION BOOK
COST AND WRITE-DOWNS VALUE
----------- --------------- -----------
<S> <C> <C> <C>
Completed technology...................... $17,066,624 $3,060,715 $14,005,909
Trademarks................................ 853,000 150,853 702,147
Workforce-in-place........................ 253,000 74,570 178,430
----------- ---------- -----------
18,172,624 3,286,138 14,886,486
----------- ---------- -----------
</TABLE>

<TABLE>
<CAPTION>
1999
----------------------------------
NET
ACCUMULATED BOOK
COST AMORTIZATION VALUE
------- ------------ -------
<S> <C> <C> <C>
Completed technology................................ $49,735 $4,144 $45,591
------- ------ -------
</TABLE>

4. ACQUIRED DISTRIBUTION AND LICENSING RIGHTS

Pursuant to a license agreement dated June 29, 1999, between the Company
and ITC Learning Corporation ["ITC"], the Company will become, for an unlimited
term, ITC's exclusive distance learning technology partner for the hosting and
delivery of educational material utilizing the A-STAR component within ITC's
Workforce Initiative Program for total consideration of $2,000,000, which was
paid by the Company during the year ended March 31, 2000.

The Company also entered into a separate distribution agreement with ITC in
March 1999. This distribution agreement provided the Company with the perpetual
non-exclusive right to market, sell and electronically convert all existing and
future ITC products in consideration for $1,000,000 in respect of electronic
distribution to the first 150,000 licensed purchasers. In the event that the
Company effects distribution to more than 150,000 licensed purchasers, the
Company and ITC will share the revenue generated therefrom based on a revenue
sharing formula. The total consideration was subsequently reduced to $975,000
and was paid by the Company in two installments in March and May 1999.

F-14
<PAGE> 67
INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

5. CAPITAL ASSETS

Capital assets consist of the following:

<TABLE>
<CAPTION>
2000
----------------------------------------
NET
ACCUMULATED BOOK
COST AMORTIZATION VALUE
---------- ------------ ----------
<S> <C> <C> <C>
Computer equipment and software................ $ 568,301 $140,789 $ 427,512
Office equipment............................... 266,439 52,685 213,754
Leasehold improvements......................... 17,285 3,569 13,716
Virtual Call Centre solution................... 858,711 -- 858,711
Computer equipment under capital lease......... 1,923,911 312,763 1,611,148
Other assets under capital lease............... 30,700 2,558 28,142
---------- -------- ----------
3,665,347 512,364 3,152,983
========== ======== ==========
</TABLE>

<TABLE>
<CAPTION>
1999
------------------------------------
NET
ACCUMULATED BOOK
COST AMORTIZATION VALUE
-------- ------------ --------
<S> <C> <C> <C>
Computer equipment and software................... $ 64,899 $7,684 $ 57,215
Office equipment.................................. 49,220 1,887 47,333
Leasehold improvements............................ 2,979 135 2,844
-------- ------ --------
117,098 9,706 107,392
======== ====== ========
</TABLE>

6. RELATED PARTY TRANSACTIONS

The amount due to related parties consists of amounts due to current and
past officers of the Company. The amounts are non-interest bearing and payable
on demand. The balances relate to expenditures incurred and services performed
on behalf of the Company, except for Cdn.$25,000 of the amount due as at March
31, 1999 and December 31, 1998 which relates to cash advances provided to the
Company, and $49,710 [Cdn.$75,000] of the amount due as of March 31, 1999 and
December 31, 1998 which relates to the intellectual property described in note
3.

During the year ended March 31, 2000, the Company incurred expenses of nil
[March 31, 1999 -- nil, December 31, 1998 -- $59,319; December 31,
1997 -- $42,119] for managerial and consulting services from Advanced Systems
Computer Consultants and nil [March 31, 1999 -- nil; December 31,
1998 -- $30,526; December 31, 1997 -- nil] for consulting services provided by a
company controlled by a shareholder and former director of the Company.

During the year ended March 31, 2000, the Company incurred expenses of
$142,740 [Cdn. $210,000] [March 31, 1999 -- $26,981; December 31,
1998 -- $16,178; December 31, 1997 -- nil] for consulting services provided by a
company owned by a shareholder and the Co-Chairman of the Company. The Company
will continue to pay a monthly consulting fee of $10,195 [Cdn.$15,000] while
services are being rendered.

During the year ended March 31, 2000, the Company paid consulting fees to a
shareholder beneficially owning greater than 5% of the outstanding shares of the
Company, in the amount of $71,370 [Cdn.$105,000]

F-15
<PAGE> 68
INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

[March 31, 1999 -- nil] for consulting services related to business development
and advice on potential acquisitions.

During the year ended March 31, 2000, general, administration and selling
expenses include $214,110 from the above related party transactions [March 31,
1999 -- $26,981; December 31, 1998 -- $106,023; December 31, 1997 -- $42,119].

Revenues for the year ended March 31, 2000 include $15,633 of hosting
services provided to a company that has a director that is an officer of the
Company [March 31, 1999 -- nil; December 31, 1998 -- nil; December 31,
1997 -- nil].

7. OBLIGATIONS UNDER CAPITAL LEASES

The Company entered into a lease agreement on June 25, 1999 for the lease
of a Sun Microsystems Enterprise 10000 computer and paid a deposit of $481,600
[Cdn.$700,000] at the time of execution. Future minimum annual lease payments
under this and other smaller capital leases expiring at various dates to March
2003 are as follows:

<TABLE>
<S> <C>
2001........................................................ $ 579,167
2002........................................................ 566,259
2003........................................................ 294,156
----------
Total minimum lease payments................................ 1,439,582
Less amount representing interest at 9.75% to 10.75%........ 156,933
----------
Balance of obligations...................................... 1,282,649
Less current portion........................................ 479,813
----------
802,836
==========
</TABLE>

The computers and equipment acquired pursuant to the capital leases have
been included in capital assets [note 5] and the depreciation on the computers
and equipment has been charged to the consolidated statements of operations and
comprehensive loss.

8. SHARE CAPITAL

AUTHORIZED

The Company has 100,000,000 shares of preferred stock authorized at a par
value of $0.001 per share and has 100,000,000 shares of common stock authorized
at a par value of $0.001 per share.

F-16
<PAGE> 69
INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

ISSUED AND OUTSTANDING COMMON STOCK

<TABLE>
<CAPTION>
COMMON STOCK ISSUED AND
OUTSTANDING AND ADDITIONAL
PAID-IN-CAPITAL
---------------------------
SHARES
# AMOUNT
----------- ------------
<S> <C> <C>
Outstanding as of January 29, 1999 [note 1]................. 15,080,000 $ 310,131
Private placement at $1.50 per share........................ 3,032,336 4,548,500
Issuance of shares in consideration for consulting
services.................................................. 60,000 337,800
Share issuance costs........................................ -- (42,992)
---------- -----------
Outstanding as of March 31, 1999............................ 18,172,336 5,153,439
Acquisition of Homebase Work Solutions Ltd. [note 1]........ 3,400,000 17,000,000
Private placement at $5.00 per share........................ 420,000 2,100,000
Private placement at $5.50 per share........................ 1,879,000 10,334,500
Private placement, other.................................... 500,000 4,187,500
ACT settlement [note 15].................................... 200,000 1,337,500
Share issuance costs........................................ -- (1,790,763)
---------- -----------
Outstanding as of March 31, 2000............................ 24,571,336 38,322,176
========== ===========
</TABLE>

EXCHANGEABLE SHARES

The number of shares of common stock outstanding as of March 31, 2000
includes 3,327,208 exchangeable shares of InfoCast Canada which have been deemed
as shares of common stock of the Company for accounting purposes and in respect
of the loss per share calculations because the exchangeable shares are the
economic equivalent of shares of common stock of the Company.

SECURITIES PURCHASE AGREEMENT

Pursuant to a Securities Purchase Agreement dated June 24, 1999, the
Company issued, by way of a private placement, 420,000 shares of common stock to
the agent at $5.00 per share for gross proceeds of $2,100,000, net of
commissions of $210,000.

Also pursuant to the Securities Purchase Agreement, the Company issued
warrants to purchase 70,000 shares of common stock on June 24, 1999 to the
placement agent. Each warrant has an exercise price of $7.00, expires June 23,
2001 and has been valued at $3.24 in the accounts based on an expected
volatility factor of 0.715 and a risk-free interest rate of 5.1%. As a result,
$226,800 was charged to share issuance costs during the year ended March 31,
2000.

PRIVATE PLACEMENTS

From July to November 1999, the Company completed the private placement of
1,879,000 shares of common stock at $5.50 per share for gross proceeds of
$10,334,500 excluding an agent's fee of $1,033,329.

In February 2000 the Company received 150,000 shares of common stock of
another publicly traded corporation in consideration for 500,000 shares of
common stock of the Company issued by way of private placement. The Company
recorded the issuance of its shares of common stock at the $8.375 per share fair
value of the Company's common stock on the date of the transaction. The shares
of common stock of the other public company received as consideration, net of
20,000 of the shares payable as a commission to the

F-17
<PAGE> 70
INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

agents, have been recorded as a short-term equity investment and classified as
"available for sale". The carrying value of the short-term investment was
adjusted to its market value as at March 31, 2000, resulting in an unrealized
loss of $287,500 included in the comprehensive loss for the period. In addition
to the transfer of ownership of 20,000 shares of common stock of the short-term
investment to the agents, the Company has accrued a $100,000 cash commission to
the agents of this private placement.

As of May 5, 2000, the market value of the short-term investment decreased
to approximately $2,200,000.

STOCK OPTIONS

1998 Stock Option Plan

As of March 31, 2000, 2,250,000 shares of common stock were reserved for
the exercise of stock options granted to various individuals involved in the
management of VPS, including 375,000 options originally granted to consultants,
pursuant to the Company's 1998 Stock Option Plan as amended on January 29, 1999.
The options were granted as follows: 2,075,000 on February 8, 1999 and 175,000
on February 1, 2000 and are exercisable at a price of $1.00 per share. Effective
April 1, 1999, an individual initially classified as an employee and who had
been granted 250,000 options became a consultant, while on May 13, 1999 an
individual initially classified as a consultant and who had been granted 100,000
options became an employee. As a result, as at March 31, 2000, 700,000 of the
options are held by consultants, while 1,550,000 are held by employees and
directors.

The options granted on February 8, 1999 expire three years from the date of
grant and were fully vested as of March 31, 2000. Of the 275,000 stock options
that were originally granted to individuals still classified as consultants that
were originally determined based on the fair market value of the options on the
date of grant, $5.87 per option, were revalued as of the August 8, 1999 vesting
date to the then current fair value of $9.06 per stock option [based on a
revised volatility of 1.019 and the August 8, 1999 closing market price of
$10.00 per share of common stock]. This revaluation resulted in a charge to
stock option compensation expense of $2,109,537 during the year ended March 31,
2000. Stock option compensation expense of $1,116,205 was charged to income
during the year in respect of the 250,000 options granted to the individual that
became a consultant during the year, while stock option compensation expense of
$503,033 was charged to income during the year in respect of the 100,000 options
granted to the individual that became a director during the year. Stock
compensation expense of $6,586,544 was charged to income during the year ended
March 31, 2000 in respect of the remaining 1,450,000 stock options originally
granted to individuals still classified as employees and directors that are
accounted for utilizing the intrinsic value method.

The 175,000 options granted on February 1, 2000 expire two years from the
date of grant, vest on July 12, 2000 and were granted to a consultant of the
Company. The deferred compensation attributable to these stock options granted
to a consultant was revalued as of March 31, 2000 to the then current fair value
of $6.07 per stock option [based on an expected dividend rate of 0%, an expected
life of one year, a risk-free rate of 6.18%, an expected volatility factor of
0.873 and the March 31, 2000 closing market price of $7.00 per share of common
stock]. These options have been valued at $1,062,250 of which $386,273 has been
recognized as a stock option compensation expense during the year ended March
31, 2000 and of which the balance of $675,977 has been recorded as deferred
compensation in stockholders' equity.

1999 Stock Option Plan

The directors and stockholders of the Company approved the 1999 Stock
Option Plan under which an additional 2,000,000 stock options are eligible for
grant. As of March 31, 2000, the Company had 1,805,000

F-18
<PAGE> 71
INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

shares of common stock reserved for the exercise of stock options granted to
various employees, officers, consultants and advisors pursuant to the 1999 Stock
Option Plan as follows:

<TABLE>
<CAPTION>
OPTIONS OPTION PRICE
GRANT DATE # PER SHARE EXPIRY DATE
---------- --------- ------------ -----------------
<S> <C> <C> <C>
June 1, 1999.......................... 910,000 $7.00 June 1, 2004
November 19, 1999..................... 400,000 7.00 November 19, 2004
December 8, 1999...................... 375,000 7.05 December 8, 2004
February 18, 2000..................... 20,000 7.00 February 8, 2005
February 29, 2000..................... 100,000 8.625 February 29, 2005
---------
1,805,000
=========
</TABLE>

The options granted on June 1, 1999 were 100% vested as of March 31, 2000.
The options granted on November 19, 1999 and December 8, 1999 are subject to a
vesting period from immediate to two years. The options granted on February 18,
2000 vest as follows: 5,000 on the date of grant and 5,000 on each of February
18, 2001, February 18, 2002 and February 18, 2003. The options granted on
February 29, 2000 vest as follows: 33,333 upon the employee assuming their
position at the Company, 33,333 on March 1, 2001 and 33,334 on March 1, 2002.

Of 1,180,500 options originally granted on June 1, 1999 pursuant to the
1999 Stock Option Plan, 270,500 were cancelled in November 1999 leaving a
balance of 910,000 outstanding as of March 31, 2000. Of the 910,000 stock
options outstanding as of March 31, 2000, 700,000 were granted to employees and
210,000 were granted to consultants and advisors. The 210,000 outstanding stock
options granted to consultants and advisors have been valued at $527,100 [based
on a weighted average expected dividend rate of 0%, weighted average expected
life of 1 year, weighted average risk-free interest rate 5.46% and a weighted
average expected volatility factor of 0.805] which has been recognized as a
stock option compensation expense during the year ended March 31, 2000. The
deferred compensation in respect of the 700,000 stock options granted to
employees and directors was nil because the exercise price of the options was
equal to the market price of the shares of common stock on the date of grant. Of
the 270,500 stock options that were cancelled, 195,500 had been granted to
consultants and had vested at the time of cancellation which resulted in stock
option compensation expense of $422,280 being recorded in the year ended March
31, 2000.

The deferred compensation in respect of the stock options granted to
employees on November 19, 1999, February 18, 2000, February 29, 2000 and 25,000
of the stock options granted on December 8, 1999 was nil because the exercise
price of the options was equal to the market price of the shares of common stock
on the date of grant. The remaining 350,000 stock options granted on December 8,
1999 have been valued at $113,750 of which $52,136 has been recognized as a
stock option compensation expense during the year ended March 31, 2000, and of
which the balance of $61,614 has been recorded as deferred compensation in
stockholders' equity. The measurement date of the 350,000 stock options granted
on December 8, 1999 was January 4, 2000, the date when the employee commenced
employment.

OTHER STOCK OPTIONS

On June 1, 1999, the directors of the Company approved the grant of 750,000
stock options outside of the 1999 Stock Option Plan to an individual who became
an officer of the Company on September 4, 1999. The stock options are
exercisable at a price of $7.00 per share, expire five years from the date of
grant and vest as follows: 250,000 on September 4, 1999 upon the acceptance by
the individual of formal employment with the Company, 250,000 on September 4,
2000 and 250,000 on September 4, 2001. These outstanding options have

F-19
<PAGE> 72
INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

been valued at $2,437,500 of which $1,523,437 has been recognized as a stock
option compensation expense during the year ended March 31, 2000, and of which
the balance of $914,063 has been recorded as deferred compensation in
stockholders' equity. The measurement date in respect of these stock options was
September 4, 1999.

On October 18, 1999, the directors of the Company approved the grant of
60,000 stock options outside of the 1999 Stock Option Plan to an individual who
is to provide financial and investor relations consulting services to the
Company. The stock options are exercisable at a price of $8.25 per share, expire
two years from the date of grant and vest as follows: 15,000 on January 14,
2000, 15,000 on March 15, 2000, 15,000 on June 15, 2000 and 15,000 on September
15, 2000. These outstanding options have been valued at $151,200 [based on an
expected dividend rate of 0%, an expected life of one year, a risk-free rate
ranging from 5.83% to 6.18% and an expected volatility factor of 0.873] of which
$125,363 has been recognized as a stock option compensation expense during the
year ended March 31, 2000, and of which the balance of $25,837 has been recorded
as deferred compensation in stockholders' equity. The deferred compensation for
the then current fair value at each interim reporting financial reporting date
will be amortized over the remaining vesting periods of the options. The
agreement with this individual was terminated in May 2000 resulting in the
cancellation of unvested options to purchase 30,000 shares of common stock
previously granted.

A summary of the Company's stock option activity is as follows:

<TABLE>
<CAPTION>
WEIGHTED
NUMBER OF AVERAGE
OPTIONS EXERCISE
# PRICE
--------- --------
<S> <C> <C>
Outstanding as of January 1, 1999........................... -- $ --
Granted..................................................... 2,250,000 1.00
Exercised................................................... -- --
Forfeited................................................... -- --
Cancelled................................................... (175,000) 1.00
--------- ------
Outstanding as of March 31, 1999............................ 2,075,000 1.00
Granted..................................................... 3,060,500 6.74
Exercised................................................... -- --
Cancelled -- not vested..................................... (75,000) 7.00
Cancelled -- vested......................................... (195,500) 7.00
--------- ------
Outstanding as of March 31, 2000............................ 4,865,000 4.28
--------- ------
Exercisable as of March 31, 2000............................ 3,628,336 3.60
========= ======
</TABLE>

In April 2000, 300,000 of the options granted under the 1998 Stock Option
Plan and 100,000 of the options granted under the 1999 Stock Option Plan were
cancelled.

PRO FORMA NET LOSS

If the Company had been following FASB Statement No. 123 ["FASB 123"] in
respect of stock options granted to its employees and directors, the Company
would have recorded a higher stock option compensation expense for the year
ended March 31, 2000 of $2,990,493 in respect of the amortization of the
estimated value of the Company's stock options to employees over the vesting
periods of the options, which results in a pro-forma net loss of $34,141,677 and
a pro-forma basic and diluted loss per share of $1.51 in respect of the year
ended March 31, 2000.

F-20
<PAGE> 73
INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

The Company assumed the following expected dividend rates, expected lives,
risk-free interest rate and expected volatility factors in respect of the
valuation of stock options granted to employees and directors in accordance with
FASB 123:

<TABLE>
<CAPTION>
WEIGHTED
AVERAGE
---------
<S> <C>
Expected dividend rate...................................... 0%
Expected life............................................... 1.5 years
Risk-free interest rate..................................... 5.30%
Expected volatility......................................... 0.8087
=========
</TABLE>

ISSUANCE OF SHARES IN CONSIDERATION FOR CONSULTING SERVICES

Pursuant to an agreement dated March 22, 1999, the Company issued 60,000
shares of common stock to a financial investment-consulting firm on March 22,
1999 in consideration for assistance in securing additional financing over the
following year. The measurement date for these shares of common stock was March
22, 2000, at which time the market value of the common shares was $7.50, which
resulted in a charge to general and administrative expenses of $439,820 during
the year ended March 31, 2000.

OTHER WARRANTS

Pursuant to a letter agreement dated May 20, 1999 with an investor
relations company and subsequent negotiations in October 1999, the Company was
obligated to pay a total of $75,000 and issue warrants to purchase 75,000 shares
of common stock in consideration for consulting services during the period from
June 1, 1999 to May 31, 2000. The payments were to be made and warrants issued
for services in advance. The following payments have been made and the following
warrants have been issued: $25,000 and 25,000 warrants on June 1, 1999 and
$12,500 and 12,500 warrants on each of October 6, 1999 and January 1, 2000. The
Company terminated the agreement in March 2000 and does not intend to make any
additional payments nor issue additional warrants. Based on an expected dividend
rate of 0%, a volatility factor of 0.963 and a risk-free interest rate of 5.10%,
the Company valued the 25,000 warrants issued on June 1, 1999 with a purchase
price of $7.00 per share, at $149,750 which is the fair market value as of the
August 31, 1999 measurement date. Based on a volatility factor of 0.914, an
expected dividend rate of 0% and a risk-free interest rate of 6.10%, the Company
valued the 12,500 warrants issued on October 6, 1999 with a purchase price of
$8.75 per share, at $33,250 which is the fair market value as of the November
30, 1999 measurement date. Based on an expected dividend rate of 0%, a
volatility factor of 0.873 and a risk-free interest rate of 6.18%, the Company
valued the 12,500 warrants issued on January 1, 2000 with a purchase price of
$7.62 per share, at $28,875 which is the fair market value as of the March 31,
2000 measurement date. All warrants issued under this agreement will be
exercisable on or after June 1, 2000 and expire May 31, 2001. The Company
charged $211,875 to general and administrative expenses in respect of these
warrants during the year ended March 31, 2000.

On June 1, 1999, the Company issued warrants to purchase 200,000 shares of
common stock to parties in consideration for past consulting services to the
Company. These warrants have a purchase price of $7.00, are exercisable on or
after June 1, 2000 and expire May 31, 2001. These warrants have been valued at
$432,000 in the accounts based on a volatility factor of 0.744, an expected
dividend rate of 0% and a risk-free interest rate of 5.10% and have been charged
to general and administrative expenses.

On February 11, 2000, the Company issued warrants to purchase 56,000 shares
of common stock to a shareholder of the Company for no consideration. These
warrants have a purchase price of $5.00, are exercisable on or after February
11, 2000 and expire February 10, 2002. These warrants have been valued at

F-21
<PAGE> 74
INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

$137,200 in the accounts based on a volatility factor of 0.840 and a risk-free
interest rate of 5.95% and have been charged to general and administrative
expenses.

9. CONVERTIBLE DEBENTURES

On March 30, 2000, the Company issued 3,500 units by way of a private
placement at $1,000 per unit for gross proceeds of $3,500,000. Each unit
consists of $1,000 principal of convertible subordinated debentures and 111.111
warrants. The convertible debentures bear interest accruing from the date of
issue at 7% per annum, payable semi-annually on September 30 and March 31 and
mature on March 31, 2005. The debentures are convertible at the option of the
holders at a conversion price of $6.00 per share. The conversion price is
subject to adjustment under certain events pursuant to the agreement. The
Company has the right to require the holder to convert all or a portion of these
debentures if [i] at any time after March 31, 2003 the closing bid price of the
Company's common stock exceeds $18.00 for 15 consecutive trading days or [ii]
the Company completes a $50 million financing within one year at a price in
excess of $12 per share. Each of the 388,889 warrants are exercisable at $7.50
per share, expire on March 31, 2003 and cannot be exercised within the first
year without also converting the convertible debentures.

The intrinsic value of the beneficial conversion option has been valued at
$1,913,482 and has been included in interest expense as the option was
exercisable upon issuance.

Cash commission costs of $275,000 were paid relating to the issuance of
these debentures and were recorded as a deferred charge as of March 31, 2000. In
addition, the Company issued agent common stock purchase warrants to purchase
97,222 shares of common stock at $7.50 per share to the agents as a placement
fee. These warrants have been valued at $329,583, based on a Black-Scholes
valuation utilizing a volatility factor of 0.864, an expected life of 2 years
and a risk-free interest rate of 5.95%, and have been recorded as a deferred
charge. The deferred charges related to this placement will be amortized on a
straight-line basis over the 5-year life of the debentures.

On April 4, 2000, the Company completed the sale of an additional 2,500
units for gross proceeds of $2,500,000 with identical terms as the debentures
issued on March 30, 2000.

10. COMMITMENTS

[a] Lease commitments

The Company leased premises and equipment under non-cancellable operating
leases, which require future minimum annual lease payments as follows:

The rental payments for the premises are exclusive of taxes and operating
costs.

During the year ended March 31, 2000, the Company incurred rent expense of
$384,334 [March 31, 1999 -- $38,382; March 31, 1998 -- $4,044; December 31,
1998 -- $16,701; December 31, 1997 -- $5,711].

F-22
<PAGE> 75
INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

[b] CosmoCom, Inc.

Pursuant to a summary of terms and conditions for a definitive agreement
between the Company and CosmoCom, Inc. dated April 1999, the Company intended to
purchase licenses for CosmoCom, Inc.'s CosmoCall software. Under this summary,
the Company placed an initial order for 300 licenses for total consideration of
$754,500. The Company has taken delivery of the 300 licenses and paid license
fees of $475,650 in the year ended March 31, 2000. The balance of $278,850 is to
be paid in three monthly installments beginning April 1, 2000. The Company
capitalized the $754,500 to the Virtual Call Centre [note 5] during the year
ended March 31, 2000 as the licenses represent completed software that will be
incorporated into the Company's virtual call centre solution currently in
development.

11. PREPAID ROYALTIES

On February 24, 2000, InfoCast and Innatrex Inc. ["Innatrex"] entered into
an Application Service Provider Agreement ["ASP Agreement"] which allows
InfoCast, among other things, to incorporate Innatrex's software product into
its product offerings and license the Innatrex software product to third
parties. In consideration, InfoCast will pay royalties to Innatrex, of which the
Company has prepaid $207,857 [Cdn.$300,000]. The Company has recorded this
prepayment as a prepaid expense and will amortize the balance as it sublicenses
Innatrex's software product.

12. JOINT VENTURE INVESTMENT

Pursuant to a shareholder agreement executed on November 25, 1999 between
the Company, 813040 Alberta Ltd. ["Newco"] and Canpet Energy Group Inc.
["Canpet"], the Company and Canpet agreed to become shareholders of Newco, with
each party initially becoming a 50% owner of Newco. Newco is to develop a
web-enabled trading business model for crude oil and natural gas liquids and
other products. Initial funding for Newco will be by way of loans from the
shareholders. Under the agreement, the Company is required to provide the
following: [i] $258,000 [Cdn.$375,000] as required by cash calls approved by the
Board of Directors of Newco, [ii] development, marketing and technical expertise
for the development and sales of products and services marketed by Newco, [iii]
temporary office space at the Company's existing Calgary office location at a
cost to be mutually agreed to by the Company and Newco, and [iv] accounting and
administrative support services until such time as Newco's business develops to
an adequate size to support a dedicated staff.

As of March 31, 2000, the Company had advanced a total of $171,721
[Cdn.$249,595] to Newco; $3,440 [Cdn.$5,000] for the initial purchase of common
shares and $168,281 in the form of shareholder loans which have a conversion
feature attached allowing the Company to convert the advances into additional
shares of Newco.

Newco issued additional common shares in the three-month period ended March
31, 2000 resulting in the dilution of the Company's ownership in Newco from 50%
to 2.13% [34.48% on a fully diluted basis] as of March 31, 2000.

A further $86,278 [Cdn.$125,405] was advanced by the Company to Newco in
April 2000, also in the form of a shareholder loan which has the same conversion
feature, that had the effect of increasing the Company's fully diluted ownership
interest to approximately 34%. The Company has accounted for this investment
using the equity method.

F-23
<PAGE> 76
INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

13. INCOME TAXES

As of March 31, 2000, the Company has accumulated non-capital losses of
approximately Cdn. $10,030,000 [approximately $7,100,000] for Canadian income
tax purposes which are available to reduce future years' taxable income. Of
these carryforward amounts, approximately Cdn. $319,000 [approximately $219,000]
resulted from the acquisition of Homebase [note 1] and if realized the tax
benefit of the unrecognized loss carryforward will be applied to reduce the
goodwill related to the acquisition of Homebase. The future income tax benefits
associated with these non-capital losses have not yet been recognized in the
accounts. These non-capital losses will expire as follows:

The Company has recorded no United States current federal income tax
expense or benefit. As of March 31, 2000, the Company has accumulated net
operating losses of approximately $3,939,000 for United States income tax
purposes which are available to reduce future years' taxable income. The future
income tax benefits associated with these net operating losses have not yet been
recognized in the accounts. These net operating losses will expire as follows:

The Company has a United States capital loss carryforward of approximately
$5,939,000. A capital loss carryforward may only be used to reduce capital gains
and cannot be applied against taxable ordinary income that might be earned by
the Company. These capital loss carryforwards will expire as follows:

Utilization of the United States net operating loss carryforwards and the
capital loss carryforwards are subject to the loss limitations rules which may
substantially limit the annualization of these losses due to the ownership
change that occurred on January 29, 1999 [note 1]. Such annual limitations may
result in the expiration of all or a portion of the loss carryovers before
utilization.

A deferred tax asset has been established relating to the operating and
capital loss carryforwards and the timing differences between the Company's tax
and financial reporting basis. A valuation allowance equal to the entire amount
of the deferred tax asset has been established due to the uncertainty of the
future utilization of the operating and capital loss carryforwards.

F-24
<PAGE> 77
INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Following are the components of the Company's deferred tax liability
balances:

<TABLE>
<CAPTION>
MARCH 31, MARCH 31,
2000 1999
----------- -----------
<S> <C> <C>
Homebase acquisition [note 1]............................. $(5,656,895) $ --
Future tax benefit of Canadian loss carryforwards......... 3,082,986 559,887
Canadian book depreciation in excess of tax
depreciation............................................ 63,092 (559,887)
Canadian valuation allowance.............................. (3,146,078) --
Future tax benefit of United States net operating loss
carryforwards........................................... 1,354,000 386,000
Future tax benefit of United States capital loss
carryforwards........................................... 2,257,000 2,029,000
Other United States amounts............................... 1,711,000 2,000
United States valuation allowance......................... (5,322,000) (2,417,000)
----------- -----------
(5,656,895) --
=========== ===========
</TABLE>

The deferred income tax recovery recorded on the consolidated statements of
operations and comprehensive loss for the year ended March 31, 2000 is in
respect of the decrease in the difference between the accounting and tax basis
of the completed technology, trademarks and workforce-in-place created upon the
acquisition of Homebase [note 1] from the May 13, 1999 acquisition date to March
31, 2000.

14. CONTINGENCIES

FAIR VALUE OF FINANCIAL INSTRUMENTS

The following disclosure of the estimated fair value of financial
instruments is made in accordance with the requirements of SFAS No. 107,
"Disclosures about Fair Value of Financial Instruments". The estimated fair
value amounts have been determined by the Company using available market
information and appropriate valuation methodologies.

The fair values of financial instruments classified as current assets or
liabilities including cash and cash equivalents, accounts receivable and
accounts payable and accrued liabilities as of March 31, 2000 approximate their
carrying values due to the short-term maturity of the instruments. The fair
values of the convertible debentures as of March 31, 2000 approximate its
carrying value.

CONCENTRATION OF CREDIT RISK

The Company invests its cash and cash equivalents primarily with a major
Canadian chartered bank. Certain deposits, at times, are in excess of limits
insured by the Canadian government. The Company believes the financial
institutions holding the Company's deposits are financially sound. Accordingly,
minimal credit risk exists.

NOTE RECEIVABLE FROM CHEROKEE MINING COMPANY INC.

Pursuant to an agreement dated November 23, 1998, as amended April 20,
1999, and effective December 18, 1998, InfoCast [the acquired entity] sold its
equity interest in its two subsidiaries, Gold King Mines Corporation ["Gold
King"] and Madison Mining Corporation ["Madison Mining"] to Cherokee Mining
Company Inc. ["Cherokee"], a company controlled by a former director of
InfoCast, for [i] a non-interest bearing note of $600,000 due November 25, 1999
and [ii] the entitlement to 80% of the net proceeds received by Madison Mining
and Gold King in excess of $681,175 from the sale of their mining properties and
assets.

F-25
<PAGE> 78
INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

InfoCast did not record a value on the $600,000 note receivable because of
the uncertainty of whether the management of Cherokee, Gold King and Madison
Mining would be able to sell the capital assets of Gold King and Madison Mining
for sufficient proceeds to enable the note to be repaid to InfoCast. As a
result, VPS did not reflect the note in the purchase equation upon the
acquisition of InfoCast in January 1999.

Pursuant to a Termination Agreement executed during the year ended March
31, 2000, [i] the agreement dated November 23, 1998 was terminated, [ii] the
non-interest bearing note of $600,000 due November 25, 1999 was cancelled, [iii]
Cherokee entered into a purchase and sale agreement with another company
pursuant to which Cherokee will sell the equity interest in Gold King and
Madison Mining to the other company in consideration for, amongst other things,
a promissory note for the principal sum of $250,000 plus interest at a rate per
annum equal to the prime rate, due on July 29, 2004, [iv] Cherokee assigned to
InfoCast the $250,000 promissory note from the other company and [v] Cherokee
agreed to pay InfoCast $22,670. InfoCast received payment of the $22,670 in
December 1999 and credited this amount to income. InfoCast did not record a
value on the $250,000 promissory note receivable because of the uncertainty of
collection. In the event the promissory note is repaid, the amount will be
credited to income.

15. SETTLEMENT WITH APPLIED COURSEWARE TECHNOLOGY (A.C.T.) INC.

Pursuant to a Letter of Intent dated February 10, 1999, as amended, between
the Company and Applied Courseware Technology (A.C.T.) Inc. ["ACT"], the Company
intended to purchase a 100% interest in ACT.

In September 1999 the Company made the decision not to proceed with the
acquisition of ACT, which ACT contested. On January 7, 2000, the Company reached
a final settlement with the shareholders of ACT whereby the Company paid $68,800
[Cdn.$100,000] in consideration for certain capital assets and the reimbursement
of expenses incurred by ACT relating to the purchase agreement, which amount is
included in the accounts as of March 31, 2000. In addition, the Company forgave
a note for $95,242 [Cdn.$140,000], including interest of $3,443 and as a result
wrote the amount receivable down to nil. The Company also issued 200,000 shares
of common stock of the Company to two shareholders of ACT and recorded an
expense in the accounts at the fair value of the common shares issued at the
date of the settlement.

During the year ended March 31, 2000, the Company made cash advances to ACT
totalling $559,873 [Cdn.$823,629] to fund certain development expenditures
incurred by ACT on behalf of the Company. These advances, in addition to $47,390
[Cdn.$70,000] that was outstanding as of March 31, 1999, have been charged to
research and development expenses during the year ended March 31, 2000.

16. SUBSEQUENT EVENTS

INVESTOR RELATIONS AGREEMENT

Pursuant to a letter agreement dated April 7, 2000, the Company will pay
$9,000 per month plus expenses, and issued warrants to purchase 200,000 common
shares [at an exercise price of $6.50 and expiring in 5 years] to a financial
advisor in consideration for general corporate financial advisory and investor
and media relations consulting services over the one year term of the agreement.
In addition, the financial advisor will be entitled to a commission on certain
corporate financing transactions in which the financial advisor is involved.

MERGER WITH I360, INC.

On February 17, 2000, the Company entered into a letter of agreement with
i360, Inc. ["i360"] and the shareholders of i360, whereby the parties agreed for
the Company and i360 to merge. On May 3, 2000, the Company and i360 executed a
definitive Agreement and Plan of Merger providing for the acquisition by the

F-26
<PAGE> 79
INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Company of all of the outstanding shares of common stock of i360. The Agreement
and Plan of Merger amended the terms agreed to in the letter of agreement and
provides for a statutory merger of i360 into InfoCast, pursuant to which the
holders of i360's issued and outstanding common stock will be entitled to
receive 0.30 shares of InfoCast common stock per share of i360 common stock,
which will result in an aggregate of 7,584,000 shares of InfoCast common stock
being issued. In addition, all outstanding warrants and stock options to
purchase shares of i360 common stock will convert into merger warrants and stock
options to purchase shares of the Company's common stock at a 1:0.3 exchange
ratio which will result in an aggregate of 4,416,000 merger warrants of the
Company with an exercise price of $0.33 per share and 1,030,803 stock options
with an exercise price of $4.00 per share being issued. The transaction, which
has been approved by the Boards of Directors of InfoCast and i360, is subject to
approval by the stockholders of i360 and InfoCast, successful completion of any
regulatory approvals and certain other conditions. The merger warrants will vest
as follows: 25% on February 21, 2000, 25% on September 21, 2000, 25% on January
21, 2001 and 25% on January 21, 2002. The stock options will vest as follows:
33.3% on May 2, 2001, 33.3% on May 2, 2002 and 33.3% on May 2, 2003.

F-27
<PAGE> 80

AUDITORS' REPORT

To the Directors of
Homebase Work Solutions Ltd.

We have audited the balance sheets of Homebase Work Solutions Ltd. [a
development stage company] as at March 31, 1999 and December 31, 1998 and the
statements of loss and accumulated development stage deficit and cash flows for
the three-month period ended March 31, 1999, the 101-day period ended December
31, 1998 and the cumulative period from inception, September 22, 1998, to March
31, 1999. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.

We conducted our audits in accordance with auditing standards generally
accepted in Canada. Those standards require that we plan and perform an audit to
obtain reasonable assurance whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation.

In our opinion, these financial statements present fairly, in all material
respects, the financial position of the Company as at March 31, 1999 and
December 31, 1998 and the results of its operations and its cash flows for the
three-month period ended March 31, 1999, the 101-day period ended December 31,
1998 and the cumulative period from inception, September 22, 1998, to March 31,
1999 in accordance with accounting principles generally accepted in Canada.

/s/ ERNST & YOUNG LLP
--------------------------------------
Chartered Accountants

Toronto, Canada,
June 11, 1999.

F-28
<PAGE> 81

HOMEBASE WORK SOLUTIONS LTD.
[A DEVELOPMENT STAGE COMPANY]

BALANCE SHEETS
[EXPRESSED IN CANADIAN DOLLARS]

<TABLE>
<CAPTION>
AS AT AS AT
MARCH 31, DECEMBER 31,
1999 1998
--------- ------------
<S> <C> <C>
ASSETS
Current
Cash........................................................ $ 332,198 $ 66,716
Prepaid expenses............................................ 2,140 2,140
Accounts receivable......................................... 9,719 41,455
--------- ---------
Total current assets.............................. 344,057 110,311
--------- ---------
Fixed assets, net [note 3].................................. 9,643 1,900
Software distribution rights, net [note 4].................. 389,244 --
--------- ---------
742,944 112,211
--------- ---------
LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIENCY)
Current
Accounts payable and accrued liabilities.................... 134,378 6,920
Promissory note payable to InfoCast Corporation [note 6].... 150,000 --
Due to shareholders [note 7]................................ 283 1,117
First preferred series A shares [note 5].................... 258,639 236,683
Dividends payable on first preferred series A shares [note
5]........................................................ 28,125 --
--------- ---------
Total current liabilities......................... 571,425 244,720
--------- ---------
Shareholders' equity (deficiency)
Common shares [note 5]...................................... 727,275 8,212
Accumulated development stage deficit....................... (555,756) (140,721)
--------- ---------
Total shareholders' equity (deficiency)........... 171,519 (132,509)
--------- ---------
742,944 112,211
--------- ---------
</TABLE>

See accompanying notes

F-29
<PAGE> 82

HOMEBASE WORK SOLUTIONS LTD.
[A DEVELOPMENT STAGE COMPANY]

STATEMENTS OF LOSS AND ACCUMULATED
DEVELOPMENT STAGE DEFICIT
[EXPRESSED IN CANADIAN DOLLARS]

<TABLE>
<CAPTION>
CUMULATIVE PERIOD
FROM INCEPTION,
THREE-MONTH 101-DAY PERIOD SEPTEMBER 22,
PERIOD ENDED ENDED 1998, TO
MARCH 31, DECEMBER 31, MARCH 31,
1999 1998 1999
------------ -------------- -----------------
<S> <C> <C> <C>
REVENUE
Interest......................................... $ 288 $ 719 $ 1,007
--------- --------- ---------
EXPENSES
Professional fees................................ 46,460 78,545 125,005
Wages and benefits............................... 81,733 29,511 111,244
National Environmental Policy Institute funding
[note 9]....................................... 143,884 -- 143,884
Bank charges and interest........................ 234 193 427
First preferred series A share interest accretion
[note 5]....................................... 21,956 11,683 33,639
First preferred series A share dividend expense
[note 5]....................................... 28,125 -- 28,125
Other............................................ 62,605 21,508 84,113
Depreciation and amortization.................... 30,326 -- 30,326
--------- --------- ---------
415,323 141,440 556,763
--------- --------- ---------
Net loss for the period.......................... (415,035) (140,721) (555,756)
Accumulated development stage deficit, beginning
of period...................................... (140,721) -- --
--------- --------- ---------
Accumulated development stage deficit, end of
period......................................... (555,756) (140,721) (555,756)
--------- --------- ---------
</TABLE>

See accompanying notes

F-30
<PAGE> 83

HOMEBASE WORK SOLUTIONS LTD.
[A DEVELOPMENT STAGE COMPANY]

STATEMENTS OF CASH FLOWS
[EXPRESSED IN CANADIAN DOLLARS]

<TABLE>
<CAPTION>
CUMULATIVE PERIOD
THREE-MONTH 101-DAY PERIOD FROM INCEPTION,
PERIOD ENDED ENDED SEPTEMBER 22, 1998,
MARCH 31, 1999 DECEMBER 31, 1998 TO MARCH 31, 1999
-------------- ----------------- -------------------
<S> <C> <C> <C>
OPERATING ACTIVITIES
Net loss for the period........................ $(415,035) $(140,721) $(555,756)
Add items not affecting cash Depreciation and
amortization................................. 30,326 -- 30,326
First preferred series A share interest
accretion [note 5]........................ 21,956 11,683 33,639
First preferred series A share dividend
expense [note 5].......................... 28,125 -- 28,125
--------- --------- ---------
(334,628) (129,038) (463,666)
Net change in non-cash working capital balances
related to operations........................ 158,360 (35,558) 122,802
--------- --------- ---------
Cash used in operating activities.............. (176,268) (164,596) (340,864)
--------- --------- ---------
INVESTING ACTIVITIES
Purchase of fixed assets....................... (8,250) (1,900) (10,150)
--------- --------- ---------
Cash used in investing activities.............. (8,250) (1,900) (10,150)
--------- --------- ---------
FINANCING ACTIVITIES
Proceeds from issuance of preferred shares..... -- 225,000 225,000
Proceeds from issuance of common shares........ 300,000 8,212 308,212
Promissory note payable to InfoCast
Corporation.................................. 150,000 -- 150,000
--------- --------- ---------
Cash provided by financing activities.......... 450,000 233,212 683,212
--------- --------- ---------
Net increase in cash during the period......... 265,482 66,716 332,198
Cash, beginning of period...................... 66,716 -- --
--------- --------- ---------
Cash, end of period............................ 332,198 66,716 332,198
--------- --------- ---------
SUPPLEMENTAL CASH FLOW INFORMATION
Income taxes paid during the period.......... -- -- --
</TABLE>

See accompanying notes

F-31
<PAGE> 84

HOMEBASE WORK SOLUTIONS LTD.
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS
[EXPRESSED IN CANADIAN DOLLARS]

MARCH 31, 1999

1. NATURE OF OPERATIONS

INCORPORATION

Homebase Work Solutions Ltd. [the "Company"] was incorporated on September
22, 1998 under the Alberta Corporations Act. The Company is in the development
stage and is engaged in the development of information delivery technologies.

ECONOMIC DEPENDENCE

In May 1999, the Company was acquired by InfoCast Corporation ["InfoCast"],
a company also in the development stage [note 8]. As a result of the Company's
limited financial resources, the Company is economically dependent upon
InfoCast.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

These financial statements have been prepared in accordance with accounting
principles generally accepted in Canada which conform in all material respects
with accounting principles generally accepted in the United States ["US GAAP"],
except as outlined in note 12. The preparation of financial statements in
accordance with such principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenue and expenses during the reporting
periods. Actual results could vary from the estimates that were used.

The Company's significant accounting policies are summarized as follows:

FISCAL PERIODS PRESENTED

The Company has not yet chosen a year end. The financial periods reported
in these financial statements conform with those of the Company's acquirer,
InfoCast [note 8].

FIXED ASSETS

Fixed assets are recorded at cost less accumulated depreciation. If it is
determined that a fixed asset is not recoverable over its estimated useful life,
the fixed asset will be written down to its net recoverable value. Maintenance
and repairs are charged to expenses as incurred. Gains and losses on disposition
of fixed assets are included in income. Depreciation is provided for at the
following annual rate and method:

<TABLE>
<S> <C>
Office furniture and
equipment 30% declining balance
</TABLE>

SOFTWARE DISTRIBUTION RIGHTS

Software distribution rights are recorded at cost less accumulated
amortization. If it is determined that a software distribution right is not
recoverable over its estimated useful life, the software distribution right will
be written down to its net recoverable value. Amortization is provided on a
straight-line basis over two years.

RESEARCH AND DEVELOPMENT

Software development costs are expensed as incurred unless they meet
generally accepted accounting criteria for deferral and amortization. Software
development costs incurred prior to the establishment of

F-32
<PAGE> 85
HOMEBASE WORK SOLUTIONS LTD.
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

technological feasibility do not meet these criteria and are expensed as
incurred. Research costs are expensed as incurred.

INCOME TAXES

The Company follows the tax liability method of income tax allocation.

3. FIXED ASSETS

Fixed assets consist of the following:

<TABLE>
<CAPTION>
MARCH 31, 1999
-----------------------------------
ACCUMULATED NET BOOK
COST DEPRECIATION VALUE
------- ------------ --------
<S> <C> <C> <C>
Office furniture and equipment...................... $10,150 $507 $9,643
------- ---- ------
</TABLE>

<TABLE>
<CAPTION>
DECEMBER 31, 1998
----------------------------------
ACCUMULATED NET BOOK
COST DEPRECIATION VALUE
------ ------------ --------
<S> <C> <C> <C>
Office furniture and equipment....................... $1,900 $-- $1,900
------ -- ------
</TABLE>

4. SOFTWARE DISTRIBUTION RIGHTS

Software distribution rights consist of the following:

<TABLE>
<CAPTION>
MARCH 31, 1999
------------------------------------
ACCUMULATED NET BOOK
COST AMORTIZATION VALUE
-------- ------------ --------
<S> <C> <C> <C>
Facet Decisions software distribution rights...... $218,385 $28,719 $189,666
Facet Petroleum software distribution rights...... 200,678 1,100 199,578
-------- ------- --------
419,063 29,819 389,244
======== ======= ========
</TABLE>

Pursuant to a licensing and distribution agreement dated March 7, 1999
between the Company and Facet Decisions Inc. ["Facet Decisions"], a private
British Columbia company, the Company acquired the exclusive right in the
telework market to distribute Facet Decisions' computer software for a period of
two years in consideration for 6,910 common shares of the Company valued at
$218,385. The software subject to the agreement includes Cause&Effect Complex
Decision Support Software and optional modules, HeadsUp Business Intelligence
Software and optional modules, FastTracks Methodology and Decision Frameworks
Industry Applications ["Facet Decisions' Software"]. In addition, all sales of
Facet Decisions' Software to the Company will be discounted by 30% from Facet
Decisions' published prices.

Pursuant to a licensing and distribution agreement dated March 30, 1999
between the Company and Facet Petroleum Solutions Inc. ["Facet Petroleum"], a
private British Columbia company, the Company acquired the exclusive right in
the telework market to distribute Facet Petroleum's Telework Operational Data
Store ["TODS"] software for a period of two years in consideration for 6,910
common shares of the Company valued at $200,678. In addition, all sales of the
TODS software to the Company will be discounted by 50% from Facet Petroleum's
published prices.

The ascribed value of the shares issued to Facet Decisions and Facet
Petroleum is based on the 50,000 total InfoCast shares received by Facet
Decisions and Facet Petroleum upon the acquisition of the Company by InfoCast
[note 8] and the market price of the InfoCast shares on the effective dates of
the respective licensing and distribution agreements with Facet Decisions and
Facet Petroleum.

F-33
<PAGE> 86
HOMEBASE WORK SOLUTIONS LTD.
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

A principal shareholder, director and officer of the Company is a director
of Facet Decisions and Facet Petroleum.

5. CAPITAL STOCK

AUTHORIZED

The Company is authorized to issue an unlimited number of common shares and
an unlimited number of first and second preferred shares.

First and second preferred shares may be issued in series and the directors
of the Company may fix, before issuance, the rights, privileges, restrictions
and conditions attached thereto.

ISSUED AND OUTSTANDING

<TABLE>
<CAPTION>
SHARES
# AMOUNT
------- --------
<S> <C> <C>
Common shares
On incorporation, issued for cash........................... 1,000 $ 1
Issued pursuant to a private placement...................... 820,180 8,211
------- --------
Outstanding as at December 31, 1998......................... 821,180 8,212
Issued pursuant to a private placement...................... 120,000 300,000
Issued for acquisition of software distribution rights [note
4]........................................................ 13,820 419,063
------- --------
Outstanding as at March 31, 1999............................ 955,000 727,275
------- --------
</TABLE>

<TABLE>
<CAPTION>
SHARES
# AMOUNT
------ --------
<S> <C> <C>
First preferred series A shares
Issued for cash, pursuant to a private placement dated
November 10, 1998......................................... 45,000 225,000
Interest accretion to redemption price...................... -- 11,683
------ --------
Outstanding as at December 31, 1998......................... 45,000 236,683
Interest accretion to redemption price...................... -- 21,956
------ --------
Outstanding as at March 31, 1999............................ 45,000 258,639
------ --------
</TABLE>

FIRST PREFERRED SERIES A UNITS

Series A of the first preferred shares were issued in units. Each unit
consisted of 2,000 redeemable first preferred series A shares, 3,000 common
share purchase warrants, and 1,500 penalty common share purchase warrants. Each
first preferred series A share was required to be redeemed by the Company by
December 31, 1999 at $7.50 per share and commanded 50% cumulative dividends
commencing January 1, 1999. The Company has recorded first preferred series A
share interest expenses of $21,956 for the three-month period ended March 31,
1999 and $11,683 for the 101-day period ended December 31, 1998 based on the
accretion of the first preferred series A shares from the $5.00 issuance price
to the December 31, 1999 $7.50 redemption price using the effective yield
method. In addition, the Company has recorded first preferred Series A share
dividend expenses of $28,125 in respect of the three-month period ended March
31, 1999. The first preferred series A shares were acquired by InfoCast [note
8].

Each common share purchase warrant entitled the holder thereof to purchase
one common share of the Company at $5.00 per share. The common share purchase
warrants would have expired 30 days subsequent to the redemption of the first
preferred series A shares in proportion to such redemption. Each penalty common

F-34
<PAGE> 87
HOMEBASE WORK SOLUTIONS LTD.
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

share purchase warrant entitled the holder to purchase one common share of the
Company at $5.00 per share. The penalty common share purchase warrants would
have vested three years after the issuance of the first preferred series A units
in proportion to the number of first preferred series A shares that had not been
redeemed at that time, and would have expired 30 days subsequent to the
redemption of the first preferred series A shares in proportion to such
redemption. The outstanding 67,500 common share purchase warrants and 33,750
penalty common share purchase warrants of the Company were acquired by InfoCast
[note 8].

6. PROMISSORY NOTE PAYABLE TO INFOCAST CORPORATION

The promissory note payable to InfoCast [note 8] bears interest at prime
plus 1%, is secured by a general security agreement covering all assets of the
Company and is due on demand. No interest was paid by the Company on the note
during the three-month period ended March 31, 1999. The note was repaid during
May 1999.

7. DUE TO SHAREHOLDERS

Amounts due to shareholders are payable on demand and are non-interest
bearing.

8. ACQUISITION BY INFOCAST CORPORATION

Pursuant to a share purchase agreement dated May 13, 1999, all of the
Company's outstanding common shares, first preferred series A shares, common
share purchase warrants and penalty common share purchase warrants were acquired
by InfoCast in consideration for 3.4 million exchangeable shares of InfoCast
Canada Corporation ["InfoCast Canada"], a 100% owned subsidiary of InfoCast. The
InfoCast Canada exchangeable shares are convertible into InfoCast common shares
on a one-for-one basis at no additional consideration. InfoCast is a development
stage technology company traded on the NASDAQ OTC Bulletin Board and is engaged
in the research and development of information delivery technologies.

As a condition of the closing of the share purchase agreement, InfoCast
will pay $210,000 to officers of the Company and must pay an additional $210,000
to the officers of the Company if InfoCast completes a private placement
financing for gross proceeds of at least US$1,000,000 or completes a letter of
credit financing of at least US$500,000.

9. NATIONAL ENVIRONMENTAL POLICY INSTITUTE FUNDING

During the three-month period ended March 31, 1999, the Company paid
US$25,000 to the National Environmental Policy Institute ["NEPI"], a United
States based non-profit environmental lobbyist group, to assist NEPI's efforts
in promoting telework policies in the United States. In addition, as at March
31, 1999, the Company has committed an additional US$70,000 in funding to NEPI
which has been provided for in the accounts.

10. INCOME TAX LOSS CARRYFORWARDS

As at March 31, 1999, the Company has accumulated non-capital losses for
Canadian income tax purposes of approximately $319,000 which are available to
reduce future years' taxable income. The future income tax benefits associated
with these non-capital losses have not yet been recognized in the accounts.

F-35
<PAGE> 88
HOMEBASE WORK SOLUTIONS LTD.
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

The loss carryforwards will expire as follows:

11. UNCERTAINTY DUE TO THE YEAR 2000 ISSUE

The Year 2000 Issue arises because many computerized systems use two digits
rather than four to identify a year. Date-sensitive systems may recognize the
year 2000 as 1900 or some other date, resulting in errors when information using
year 2000 dates is processed. In addition, similar problems may arise in some
systems which use certain dates in 1999 to represent something other than a
date. The effects of the Year 2000 Issue may be experienced before, on, or after
January 1, 2000, and, if not addressed, the impact on operations and financial
reporting may range from minor errors to significant systems failure which could
affect an entity's ability to conduct normal business operations. It is not
possible to be certain that all aspects of the Year 2000 Issue affecting the
Company, including those related to the efforts of customers, suppliers, or
other third parties, will be fully resolved.

12. RECONCILIATION TO ACCOUNTING PRINCIPLES GENERALLY ACCEPTED IN THE UNITED
STATES

These financial statements have been prepared in accordance with accounting
principles generally accepted in Canada which conform in all material respects
with US GAAP except as follows:

INTEREST ACCRETION AND DIVIDENDS ON FIRST PREFERRED SHARES

Under US GAAP, first preferred share interest accretion and dividends
payable are charged directly to shareholders' equity. Accordingly, the net loss
would have decreased by $50,081 in respect of the three-month period ended March
31, 1999 [101-day period ended December 31, 1998 -- $11,683].

F-36
<PAGE> 89

REPORT OF INDEPENDENT AUDITORS

Board of Directors
i360 inc.

We have audited the accompanying consolidated balance sheet of i360 inc. as
of December 31, 1999, and the related consolidated statements of operations,
changes in stockholders' equity, and cash flows for the period from July 14,
1999 (inception) through December 31, 1999. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audit.

We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial all material respects, the consolidated
financial position of i360 inc. as of statements referred to above present
fairly, in December 31, 1999 and the results of its operations and its cash
flows for the period from July 14, 1999 (inception) through December 31, 1999 in
conformity with generally accepted accounting principles.

The accompanying financial statements have been prepared assuming that i360
inc. will continue as a going concern. As more fully described in Note 1, the
Company has incurred an operating loss and has a working capital deficiency.
These conditions raise substantial doubt about the Company's ability to continue
as a going concern. Management's plans with respect to obtaining financial
resources they believe are necessary to move toward profitable operations are
also described in Note 1. The financial statements do not include any
adjustments to reflect the possible future effects on the recoverability and
classification of assets or the amounts and classification of liabilities that
may result from the outcome of this uncertainty.

/s/ ERNST & YOUNG LLP
--------------------------------------
Ernst & Young LLP

Tucson, Arizona
February 16, 2000

F-37
<PAGE> 90

I360 INC.

CONSOLIDATED BALANCE SHEET

<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31,
1999 2000
------------ -----------
(UNAUDITED)
<S> <C> <C>
ASSETS
Current assets:
Cash...................................................... $ 103,471 $ 1,785,795
Accounts receivable, net of allowance of $95,278 in 2000
and $98,769 in 1999.................................... 69,478 72,721
Stock subscriptions receivable............................ 25,000 --
Prepaid expenses and other................................ 122,272 300,554
----------- -----------
Total current assets........................................ 320,221 2,159,070
Property and equipment:
Computer hardware......................................... 206,091 272,175
Office equipment.......................................... 165,635 166,407
Software.................................................. 5,517 12,669
----------- -----------
377,243 451,251
Accumulated depreciation.................................. 18,170 49,664
----------- -----------
359,073 401,587
Goodwill, net of amortization of $219,562 in 2000 and
$125,464 and 1999...................................... 1,756,499 1,662,401
Deposits.................................................. 300,000 290,000
Other assets.............................................. 84,375 76,337
----------- -----------
$ 2,820,168 $ 4,589,395
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable.......................................... $ 656,360 $ 552,677
Accrued stock repurchase obligation....................... 760,600 250,000
Accrued expenses.......................................... 162,122 561,985
Deferred revenue.......................................... 4,050 45,254
----------- -----------
Total current liabilities................................... 1,583,132 1,409,916
Accrued building lease expense.............................. 144,000 176,800
Commitments and contingencies
Stockholders' equity:
Series A Convertible Preferred stock, no par value,
authorized 5,000,000 shares, issued and outstanding 300
shares................................................. -- 3,500,000
Common stock, $0.0001 par value, authorized 75,000,000
shares, issued and outstanding 16,280,000 in 2000 and
19,864,904 shares in 1999.............................. 1,987 1,627
Paid in capital........................................... 4,579,929 8,580,289
Accumulated deficit....................................... (3,488,880) (9,079,237)
----------- -----------
Total stockholders' equity.................................. 1,093,036 3,002,679
=========== ===========
$ 2,820,168 $ 4,589,395
=========== ===========
</TABLE>

See accompanying notes.

F-38
<PAGE> 91

I360 INC.

CONSOLIDATED STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
PERIOD FROM
JULY 14, 1999
(INCEPTION) THREE MONTHS
THROUGH ENDED
DECEMBER 31, MARCH 31,
1999 2000
------------- ------------
(UNAUDITED)
<S> <C> <C>
Revenues:
Set-top box sales......................................... $ 119,148 $ 73,204
Subscription services..................................... 7,175 217,001
Other..................................................... 29,759 47,145
----------- -----------
Total revenue............................................... 156,082 337,350
Costs and expenses:
Cost of revenue........................................... 229,884 588,597
Sales and marketing....................................... 572,288 306,424
General and administrative................................ 2,017,132 1,142,684
Product development....................................... 699,636 296,151
Amortization of goodwill.................................. 125,464 94,098
----------- -----------
Total costs and expenses.................................... 3,644,404 2,427,954
----------- -----------
Operating loss.............................................. (3,488,322) (2,090,604)
Other income (expense), net................................. (558) 247
----------- -----------
Loss before income taxes.................................... (3,488,880) (2,090,357)
Provision for income taxes.................................. -- --
----------- -----------
Net loss before beneficial conversion....................... (3,488,880) (2,090,357)
Deemed dividend for preferred stock......................... -- (3,500,000)
=========== ===========
Net loss attributable to common shareholders................ $(3,488,880) $(5,590,357)
=========== ===========
Basic and diluted net loss per share........................ $ (0.16) $ (0.33)
=========== ===========
Basic and diluted weighted average common shares............ 21,211,905 17,189,464
=========== ===========
</TABLE>

See accompanying notes.

F-39
<PAGE> 92

i360 inc.

Consolidated Statement of Changes in Stockholders' Equity
Period from July 14, 1999 (inception) through March 31, 2000

<TABLE>
<CAPTION>
SERIES A CONVERTIBLE
PREFERRED STOCK COMMON STOCK
--------------------- -------------------- PAID IN ACCUMULATED
SHARES DOLLARS SHARES DOLLARS CAPITAL DEFICIT TOTAL
------- ----------- ---------- ------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Issuance of stock to founders............ -- $ -- 26,560,000 $2,656 $ 84,550 $ -- $ 87,206
Sales of stock for cash.................. -- 3,344,159 335 3,614,470 -- 3,614,805
Issuance of stock -- ITS acquisition..... -- 5,000,000 500 3,332,850 -- 3,333,350
Return of shares:
ITS acquisition........................ -- (2,539,255) (254) (1,692,591) -- (1,692,845)
Other shareholders..................... -- (9,200,000) (920) 920 -- --
Repurchase and cancellation of stock..... -- (3,300,000) (330) (760,270) -- (760,600)
Net loss for the period.................. -- -- -- -- (3,488,880) (3,488,880)
--- ---------- ---------- ------ ----------- ----------- -----------
Balance at December 31, 1999............. -- 19,864,904 1,987 4,579,929 (3,488,880) 1,093,036
Sales of common stock for cash
(unaudited)............................ -- -- 285,714 28 499,972 -- 500,000
Sale of convertible preferred stock for
cash (unaudited)....................... 300 3,500,000 -- -- -- -- 3,500,000
Deemed dividend on convertible preferred
stock (unaudited)...................... -- -- -- -- 3,500,000 (3,500,000) --
Return of shares from shareholders
(unaudited)............................ -- -- (3,966,618) (397) 397 -- --
Shares issued under fair value provision
(unaudited)............................ -- -- 96,000 9 (9) -- --
Net loss for period (unaudited).......... -- -- -- -- -- (2,090,357) (2,090,357)
--- ---------- ---------- ------ ----------- ----------- -----------
Balance at March 31, 2000 (unaudited).... 300 $3,500,000 16,280,000 $1,627 $ 8,580,289 $(9,079,237) $ 3,002,679
=== ========== ========== ====== =========== =========== ===========
</TABLE>

See accompanying notes.

F-40
<PAGE> 93

I360 INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

<TABLE>
<CAPTION>
PERIOD FROM
JULY 14, 1999
(INCEPTION) THREE MONTHS
THROUGH ENDED
DECEMBER 31, MARCH 31,
1999 2000
------------- ------------
(UNAUDITED)
<S> <C> <C>
Operating activities
Net loss.................................................... $(3,488,880) $(2,090,357)
Adjustments to reconcile net loss to net cash used in
operating activities:
Depreciation and amortization............................. 149,841 125,929
Loss on sale of assets.................................... 77,925 2,389
Changes in operating assets and liabilities:
Accounts receivable.................................... (38,944) (3,243)
Prepaid expenses and other............................. (112,728) (170,244)
Accounts payable....................................... 388,682 (103,683)
Accrued expenses....................................... 312,576 432,663
Deposits............................................... (300,000) 10,000
Deferred revenue....................................... 4,050 41,204
----------- -----------
Net cash used in operating activities....................... (3,007,478) (1,755,342)
Investing activities
Purchases of property and equipment......................... (439,189) (76,734)
Proceeds from sale of property and equipment................ 89,321 --
----------- -----------
Net cash used in investing activities....................... (349,868) (76,734)
Financing activities
Proceeds from issuance of stock............................. 3,614,805 4,000,000
Repayment of ITS shareholder loans.......................... (153,988) --
Payments of stock repurchase obligation..................... -- (510,600)
Stock subscription payment.................................. -- 25,000
----------- -----------
Net cash provided by financing activities................... 3,460,817 3,514,400
----------- -----------
Increase in cash............................................ 103,471 1,682,324
Cash, beginning of period................................... -- 103,471
=========== ===========
Cash, end of period......................................... $ 103,471 $ 1,785,795
=========== ===========
Noncash activities
Common stock issued for assets.............................. $ 87,206 $ --
=========== ===========
</TABLE>

See accompanying notes.

F-41
<PAGE> 94

I360 INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
PERIOD FROM JULY 14, 1999 (INCEPTION) THROUGH DECEMBER 31, 1999
(THE INFORMATION FOR THE THREE MONTHS ENDED MARCH 31, 2000 IS UNAUDITED.)

1. ACCOUNTING POLICIES

ORGANIZATION

i360 inc. (the Company) is an internet solutions company. The Company was
founded on July 14, 1999.

INTERIM FINANCIAL INFORMATION

The consolidated financial statements for the three months ended March 31,
2000 are unaudited but include all adjustments (consisting only of normal
recurring adjustments) that the Company considers necessary for a fair
presentation of financial position and results of operations. Operating results
for the three months ended March 31, 2000 are not necessarily indicative of the
results that may be expected for any future period.

BASIS OF PRESENTATION

The accompanying consolidated financial statements have been prepared
assuming the Company is a going concern. As disclosed in the financial
statements, the Company has incurred a net loss through December 31, 1999 of
approximately $3.5 million and has a working capital deficiency. Management's
plan with respect to this matter is to raise sufficient additional financial
resources to enable the Company to increase the volume of its customers to a
level that will generate net income and positive operating cash flows. In this
regard, management has negotiated an agreement to be acquired by Infocast
Corporation (Infocast) (see Note 7). Management believes that if the transaction
is completed Infocast will have the financial resources necessary to enable it
to meet its financial obligations. Should the transaction not occur, the Company
intends to seek alternative investments to generate operating capital. However,
the Company is not currently in discussions with potential financial resources
other than Infocast. The financial statements do not include any adjustments
that might be necessary should the Company be unable to continue as a going
concern.

CONCENTRATION OF CREDIT RISK

Sales to two customers accounted for a total of 33% of the Company's
revenue in the period from July 14, 1999 (inception) through December 31, 1999,
and 72% for the three months ended March 31, 2000. One of these customers is
owned by a shareholder in the Company.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The Company's accounts receivable and accounts payable represent financial
instruments as defined by Statement of Financial Accounting Standards (SFAS) No.
107, Disclosures About Fair Value of Financial Instruments. The carrying value
of these financial instruments is a reasonable approximation of fair value, due
to their current maturities.

USE OF ESTIMATES

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.

F-42
<PAGE> 95
I360 INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

PRINCIPLES OF CONSOLIDATION

The consolidated financial statements include the accounts of the Company
and its wholly-owned subsidiary, Innovative Technology Solutions, Inc. (ITS).
All significant intercompany accounts and transactions are eliminated.

STOCK SUBSCRIPTION RECEIVABLE

The Company records stock subscriptions receivable as current assets to the
extent they are paid in a short time frame after year-end.

PROPERTY AND EQUIPMENT

Property and equipment are stated at cost, except for items acquired from
ITS which were recorded at their fair value on the acquisition date.
Depreciation is computed by the straight-line method over the estimated useful
lives ranging from three to five years.

GOODWILL

Goodwill incurred in connection with the ITS acquisition is amortized on a
straight-line basis over the estimated useful life of 5 years.

REVENUE RECOGNITION

Revenue from the sale of set-top boxes is recognized when the items are
shipped. Subscription services are recognized when the service is provided.

INCOME TAXES

Income taxes are determined utilizing the liability method. This method
gives consideration to the future tax consequences associated with temporary
differences between the carrying amounts of assets and liabilities for financial
statement purposes and the amounts used for income tax purposes.

LOSS PER SHARE COMPUTATION

Loss per share is computed in accordance with SFAS No. 128, "Earnings per
Share." Basic loss per share is computed using the weighted average number of
common shares. Diluted loss per share is computed using the weighted average
number of common share equivalents outstanding during the period. Dilutive
common share equivalents consist of stock options and warrants using the
treasury method and dilutive convertible securities using the if-converted
method, if the effect would be dilutive. Given the net loss of the Company,
there are no dilutive shares.

2. INCOME TAXES

Significant components of Company's deferred tax assets at December 31,
1999 are as follows:

<TABLE>
<S> <C>
Net operating losses........................................ $ 1,235,000
Other....................................................... 165,000
Valuation allowance......................................... (1,400,000)
-----------
$ --
===========
</TABLE>

At December 31, 1999, the Company has net operating loss carryforwards for
federal and state income tax purposes of approximately $2.9 million. These
federal and state carryforwards will begin to expire in 2020

F-43
<PAGE> 96
I360 INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

and 2005, respectively, if not previously utilized. No income taxes were paid in
the period ended December 31, 1999.

3. COMMITMENTS AND CONTINGENCIES

Litigation: The Company is involved from time to time in various litigation
matters. Management believes that the resolution of such matters will not have a
material adverse impact on the Company's financial position, results of
operations or cash flows.

Operating Leases: The Company leases various equipment and office space
under operating leases. Aggregate future commitments under noncancelable
operating leases are as follows at December 31, 1999:

Rent expense was $204,659 in the period ended December 31, 1999 and was
$209,843 for the three month period ended March 31, 2000. The Company is
obligated to reimburse the landlord $200,000 for leasehold improvements in
twenty equal monthly installments of $10,000 beginning October 1, 2000. The
landlord or affiliates thereof received 45,000 common shares in exchange for a
commitment to make $84,375 in leasehold improvements in the future. Such amount
is included in long-term other assets until such expenditures are made.

Other contractual obligations: ITS is obligated to pay certain per-user
activation (one-time) and technical support (monthly) fees to Liberate
Technologies (Liberate) as new internet service customers are obtained. The
rights to certain Liberate-owned technology have been licensed by ITS from
Liberate under an agreement which expires in July 7, 2001. At December 31, 1999,
the Company had prepaid license fees of $71,250, net of amortization of $23,750.
Under the arrangement, the original prepayment is reduced by $95 per new
subscriber. The Company records amortization at the greater of straight line or
the per subscriber amounts.

4. ACQUISITION OF ITS

The Company acquired ITS on September 1, 1999. Total consideration of
$1,881,963 paid by the Company consisted of (i) 2,460,745 shares of common stock
and (ii) the assumption of a deficiency in net assets of $241,458, and was
allocated to goodwill. Included in the deficiency in net assets assumed by the
Company was $153,988 in loans payable to certain ITS shareholders, which were
paid off by the Company in 1999. The original purchase called for the issuance
of 5,000,000 shares of the Company's common stock. Subsequent to the acquisition
the parties amended the share issuance agreement and the sellers returned
2,539,255 shares for no consideration. The acquisition has been accounted for as
a purchase. The results of ITS are included in the accompanying consolidated
financial statements from the date of acquisition.

5. STOCK ISSUANCES

One of the Company's founding shareholders and former chief executive
officer entered into an agreement with the Company to end his employment status
with the Company. Under the terms of the arrangement the former executive agreed
to return 9,200,000 of his 11,000,000 shares of common stock issued at the
formation of the Company for no consideration.

F-44
<PAGE> 97
I360 INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

During 1999, the Company agreed to repurchase and cancel 3,300,000 shares
of common stock from its former chief executive officer and another former
employee for a total of $760,600 payable in the year 2000.

On February 15, 2000, the Company sold 285,714 shares of common stock to
two current shareholders for $500,000 in cash.

On March 8 and March 10, 2000, the Company sold 300 shares of Series A
convertible preferred shares to new investors for $3,500,000. The 300 shares are
convertible into the greater of 9,000,000 shares of common stock or 22.5% of the
outstanding common stock on a fully diluted basis (9,052,258 shares at March 31,
2000) at the discretion of the shareholders at any time. No stated dividends
accrue on the convertible preferred shares and the holders are entitled to
voting rights based upon the number of common shares into which the preferred
shares convert. Given the beneficial conversion feature the Company recorded the
$3,500,000 of proceeds as zero for preferred stock and recorded a $3,500,000
deemed preferred stock dividend given that the fair value of the common shares
into which the preferred stock converts was in excess of the preferred stock
proceeds by an amount in excess of the proceeds as is required by EITF 98-5.
Such amount is also reflected as a deemed preferred stock dividend in the
statement of operations.

During the three months ended March 31, 2000, the Company received a return
of 3,966,618 common shares from founding shareholders. The Company also issued
96,000 common shares to certain investors who initially purchased shares at
$2.50 per share and had the right to receive additional shares for no additional
consideration given that in February 2000 common shares were sold for cash at
$1.75 per share.

6. YEAR 2000

The Company has experienced no issues to date with respect to the Year 2000
date change.

7. SUBSEQUENT EVENTS

Certain shareholders of the Company who as a group maintain a controlling
interest in the Company have entered into an agreement with Infocast to vote in
favor of a sale of the shares of the Company to Infocast in exchange for
Infocast common shares. There is no assurance that such a transaction will occur
given that it is subject to certain due diligence matters as well as voting
requirements.

The Company had no employee stock option plan in place at December 31,
1999, although commitments to issue stock options to certain employees in the
future had been made as of that date. On January 21, 2000, the Company adopted
the i360 Stock Incentive Plan (the Plan) under which a total of 14,900,000
shares of common stock were issued. Both incentive and non-qualified stock
options may be granted under the Plan and such options generally vest as
follows: 25% after one month, 25% after 8 months, 25% after 12 months and 25%
after 24 months. All outstanding options shall become fully exercisable upon a
change in control.

The Company has elected to follow APB 25 in accounting for its employee
stock options. Under APB 25, as long as the exercise price of the Company's
employee stock options equals or exceeds the fair value of the underlying stock
on the date of the grant, no compensation expense is recognized. All of the
Company's employee stock option grants have been made at fair value for
accounting purposes. At the time of the January 21, 2000 grants the Company was
without financial resources and on the verge of discontinuing operations.
Accordingly, management believes the $0.10 grant price was not less than fair
value.

Pro forma information regarding net loss and net loss per share is required
by Statement 123, which also requires that the information be determined as if
the Company has accounted for all its employee stock

F-45
<PAGE> 98
I360 INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

options grants under the fair value method of that Statement. The fair value for
these options was estimated at the date of grant using a minimum value pricing
model with the following weighted-average assumptions:

<TABLE>
<S> <C>
Expected life of the award.................................. 5 years
Dividend yield.............................................. 0 percent
Risk-free interest rate..................................... 5 percent
</TABLE>

The impact of such pro forma amounts was not material to the Company.

Option activity under the stock option plan is as follows:

<TABLE>
<CAPTION>
WEIGHTED
AVERAGE
EXERCISE EXERCISE
SHARES PRICE PRICE
---------- -------- --------
<S> <C> <C> <C>
Outstanding at December 31, 1999.................... -- $ -- $ --
Granted............................................. 14,900,000 0.10 0.10
Exercised........................................... -- --
Expired or canceled................................. -- -- --
---------- ----- -----
Outstanding at March 31, 2000....................... 14,900,000 $0.10 $0.10
========== ===== =====
</TABLE>

The weighted average fair value of options granted in 2000 was $0.02. The
weighted average remaining contractual life at March 31, 2000 was approximately
ten years.

On May 2, 2000, the Company issued 3,436,010 additional options to purchase
common stock at $1.33 per share.

F-46
<PAGE> 99

INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
[EXPRESSED IN UNITED STATES DOLLARS UNLESS OTHERWISE STATED]
PREPARED WITHOUT AUDIT OR REVIEW

MARCH 31, 2000

1. BASIS OF PRESENTATION

The unaudited pro forma consolidated financial information of InfoCast
Corporation (formerly Virtual Performance Systems Inc.) (a development stage
company) (the "Company") set forth below gives effect to the acquisitions of
Homebase Work Solutions Ltd, ("Homebase") and i360 Inc. ("i360") as if the
Company had acquired i360 on March 31, 2000 for the purpose of the pro forma
consolidated balance sheet and as if the Company had acquired Homebase and i360
as of April 1, 1999 for purposes of the pro forma consolidated statement of
operations for the year ended March 31, 2000. Homebase was acquired by the
Company on May 13, 1999, and the acquisition of i360 is expected to close before
August 31, 2000.

The pro forma consolidated financial statements are not necessarily
indicative of the results that actually would have occurred had the Company
acquired Homebase and i360 on the dates indicated or which would be obtained in
the future.

The unaudited pro forma consolidated information should be read in
conjunction with the audited consolidated financial statements of the Company,
the audited financial statements of Homebase and the audited and unaudited
financial statements of i360 appearing elsewhere in this proxy statement.

The unaudited pro forma consolidated balance sheet as of March 31, 2000 has
been prepared from the audited consolidated balance sheet of the Company as of
March 31, 2000 and the unaudited balance sheet of i360 as of March 31, 2000.

The unaudited pro forma statement of operations for the year ended March
31, 2000 has been prepared from the audited consolidated statement of operations
of the Company for the year ended March 31, 2000, the unaudited pre-acquisition
statement of operations of Homebase for the 43 day period ended May 13, 1999
after translation of the statement of operations from Canadian dollars to United
States dollars, and the audited and unaudited statements of operations of i360
for the 171-day period ended December 31, 1999 and the three months ended March
31, 2000, respectively. The unaudited statement of operations of Homebase has
been prepared in accordance with Canadian GAAP ("Canadian GAAP").

The pro forma adjustments do not reflect any operating efficiencies or
potential synergies that may be achievable with respect to the combined
companies.

The pro forma adjustments reflecting the acquisition of i360 using the
purchase method of accounting are tentative and are based on available financial
information and certain estimates and assumptions. The actual adjustments to the
Company's consolidated financial statements upon consummation of the acquisition
of i360 will depend on a number of factors, including additional financial
information at such time, changes in values and changes in i360's operating
results between the date of preparation of the unaudited pro forma consolidated
information and the consummation of the acquisition. Therefore, it is likely
that the actual adjustments will differ from the pro forma adjustments.
Management of the Company believes that such assumptions provide a reasonable
basis for presenting all of the significant effects of the transactions
contemplated and that the pro forma adjustments give appropriate effect to those
assumptions and are properly applied in the pro forma combined financial
statements.

F-47
<PAGE> 100

INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
[EXPRESSED IN UNITED STATES DOLLARS UNLESS OTHERWISE STATED]
PREPARED WITHOUT AUDIT OR REVIEW

MARCH 31, 2000

PRO FORMA CONSOLIDATED BALANCE SHEET
[EXPRESSED IN UNITED STATES DOLLARS]
PREPARED WITHOUT AUDIT OR REVIEW

<TABLE>
<CAPTION>
AS AT MARCH 31, 2000
--------------------------------------------------------------
INFOCAST PRO FORMA PRO FORMA
CORPORATION I360 INC. NOTE ADJUSTMENTS CONSOLIDATED
------------ ----------- ---- ----------- ------------
<S> <C> <C> <C> <C> <C>
ASSETS
Current
Cash and cash equivalents........... $ 3,637,931 $ 1,785,795 $ -- $ 5,423,726
Short-term equity investment........ 3,900,000 -- -- 3,900,000
Accounts receivable................. 275,283 72,721 -- 348,004
Prepaid expenses and other.......... 324,835 300,554 -- 625,389
------------ ----------- --- ----------- ------------
8,138,049 2,159,070 -- 10,297,119
Deferred agency fee................. 604,583 -- -- 604,583
Capital assets, net................. 3,152,983 401,587 -- 3,554,570
Distribution and licensing rights... 2,975,000 -- -- 2,975,000
Intellectual property............... 14,886,486 -- (c) 60,000,000 74,886,486
Goodwill, net....................... 4,812,380 1,662,401 (c) 15,443,017 21,917,798
Deposits............................ -- 290,000 -- 290,000
Other assets........................ -- 76,337 -- 76,337
------------ ----------- --- ----------- ------------
34,569,481 4,589,395 75,443,017 114,601,893
------------ ----------- --- ----------- ------------
LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIENCY)
Current liabilities
Accounts payable and accrued
liabilities....................... 1,814,538 1,541,462 (c) -- 3,356,000
Current portion of obligations under
capital leases.................... 479,813 -- -- 479,813
Due to related parties.............. 20,392 -- -- 20,392
Deferred revenue.................... -- 45,254 -- 45,254
------------ ----------- --- ----------- ------------
Total current liabilities........... 2,314,743 1,586,716 -- 3,901,459
------------ ----------- --- ----------- ------------
Convertible debenture............... 3,500,000 -- -- 3,500,000
Obligation under capital lease...... 802,836 -- -- 802,836
Deferred income taxes............... 5,656,895 -- (c) 24,000,000 29,656,895
------------ ----------- --- ----------- ------------
Total liabilities................... 12,274,474 1,586,716 24,000,000 37,861,190
------------ ----------- --- ----------- ------------
Shareholders' equity
Common stock........................ 23,071 1,627 -- --
-- -- (c) 7,584 --
-- -- (c) (1,627) 30,655
Preferred stock, Class A............ -- 3,500,000 (c) (3,500,000) --
Additional paid-in-capital.......... 57,933,723 8,580,289 (c) 25,894,679 --
-- -- (c) 19,963,144 --
-- -- (d) 1,693,911 114,065,746
Deferred compensation............... (1,677,491) -- (d) (1,693,911) (3,371,402)
Warrants............................ 1,007,875 -- -- 1,007,875
Accumulated other comprehensive
loss.............................. (237,033) -- -- (237,033)
Accumulated development stage
deficit........................... (34,755,138) (9,079,237) (c) 9,079,237 (34,755,138)
------------ ----------- --- ----------- ------------
Total shareholders' equity.......... 22,295,007 3,002,679 51,443,017 76,740,703
------------ ----------- --- ----------- ------------
34,569,481 4,589,395 75,443,017 114,601,893
============ =========== === =========== ============
</TABLE>

F-48
<PAGE> 101

INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
[EXPRESSED IN UNITED STATES DOLLARS UNLESS OTHERWISE STATED]
PREPARED WITHOUT AUDIT OR REVIEW

MARCH 31, 2000

PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
[EXPRESSED IN UNITED STATES DOLLARS]
PREPARED WITHOUT AUDIT OR REVIEW

<TABLE>
<CAPTION>
YEAR ENDED MARCH 31, 2000
----------------------------------------------------------------------------------
HOMEBASE
WORK
SOLUTIONS LTD. I360 INC.
(43-DAY PERIOD (262-DAY PERIOD
INFOCAST ENDED ENDED PRO FORMA PRO FORMA
CORPORATION MAY 13, 1999) MARCH 31, 2000) NOTE ADJUSTMENT CONSOLIDATED
----------- -------------- --------------- ---- ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
REVENUE............................... $ 305,754 $ -- $ 493,432 $ -- $ 799,186
EXPENSES
General, administrative and selling... 7,391,128 68,130 4,857,567 -- 12,316,825
Stock option compensation............. 13,351,908 -- -- [f] 1,363,439 14,715,347
Research and development.............. 5,186,265 -- 995,787 -- 6,182,052
Interest and loan fees................ 1,913,482 -- -- -- 1,913,482
First preferred series A interest
accretion........................... -- 7,518 -- [a] (7,518) --
First preferred series A share
dividend expense.................... -- 8,813 -- [a] (8,813) --
Amortization and depreciation......... 4,810,581 16,872 219,562 [b] 546,351 --
[e] 15,421,084 21,014,450
----------- -------- ---------- --- ----------- ------------
32,653,364 101,333 6,072,916 17,314,543 56,142,156
----------- -------- ---------- ----------- ------------
Loss from operations before the
following........................... (32,347,610) (101,333) (5,579,484) (17,314,543) (55,342,970)
Interest income....................... 132,057 473 247 132,777
Equity in loss of joint venture....... (164,736) -- -- -- (164,736)
----------- -------- ---------- ----------- ------------
Loss before income taxes.............. (32,380,289) (100,860) (5,579,237) (17,314,543) (55,374,929)
Deferred income taxes................. (1,229,105) -- -- [b] (159,945) --
-- -- -- [e] (4,800,000) (6,189,050)
----------- -------- ---------- --- ----------- ------------
Loss before beneficial conversion..... (31,151,184) (100,860) (5,579,237) (12,354,598) (49,185,879)
Deemed dividend for preferred stock... -- -- 3,500,000 [g] (3,500,000) --
----------- -------- ---------- --- ----------- ------------
Net loss for the period............... (31,151,184) (100,860) (9,079,237) (8,854,598) (49,185,879)
=========== ======== ========== === =========== ============
Weighted average number of shares
outstanding......................... 22,655,810 399,454 7,584,000 -- 30,639,264
=========== ======== ========== === =========== ============
Basic and diluted loss per share...... (1.37) (0.25) (1.20) (1.81)
=========== ======== ========== === =========== ============
</TABLE>

F-49
<PAGE> 102

INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
[EXPRESSED IN UNITED STATES DOLLARS UNLESS OTHERWISE STATED]
PREPARED WITHOUT AUDIT OR REVIEW

MARCH 31, 2000

2. PRO FORMA ADJUSTMENTS

The unaudited pro-forma consolidated financial statements give effect to
the following pro forma adjustments:

[a] Homebase's first preferred Series A shares were purchased by the
Company on May 13, 1999. Accordingly, Homebase's first preferred Series A
interest accretion of $7,518 and first preferred Series A share dividend
expense of $8,813 each recorded in Homebase's statement of operations for
the 43-day period ended May 13, 1999 prepared in accordance with Canadian
GAAP have been eliminated because these items would be charged directly to
shareholders' equity under accounting principles generally accepted in the
United States.

[b] The amortization of the $17,015,000 of completed technology,
$853,000 of trademarks, $253,000 of workforce-in-place and $5,846,293 of
goodwill created by the purchase of Homebase by the Company over the
pre-acquisition 43-day period ended May 13, 1999 on a straight-line basis
utilizing amortization periods of five years in respect of the completed
technology, trademarks and goodwill and three years in respect of the
workforce-in-place. In addition, the amortization of the $6,886,000
deferred income tax liability [created by the purchase of Homebase by the
Company in respect of the difference between the tax and accounting basis
of the completed technology, trademarks and workforce-in-place] over the
periods of the underlying assets.

[c] The acquisition of i360 by the Company. On February 17, 2000, the
Company entered into a letter of agreement with i360 and the shareholders
of i360 whereby the parties agreed for the Company and i360 to merge. On
May 3, 2000, the Company and i360 executed a definitive Agreement and Plan
of Merger providing for the acquisition by the Company of all of the
outstanding shares of common stock of i360. The Agreement and Plan of
Merger amended the terms originally agreed to in the letter of agreement
and provides for a statutory merger of i360 into the Company, pursuant to
which the holders of i360's issued and outstanding common stock will be
entitled to receive 0.30 shares of the Company's common stock per share of
i360 common stock which will result in an aggregate of 7,584,000 shares of
the Company's common stock being issued. In addition, all outstanding
warrants and stock options to purchase shares of i360 common stock will
convert into stock options and merger warrants to purchase shares of the
Company's common stock at a 1:0.3 exchange ratio which based on i360's
options outstanding as of May 3, 2000 will result in an aggregate of
4,416,000 merger warrants of the Company with an exercise price of $0.30
per share and 1,030,803 stock options of the Company with an exercise price
of $4.00 per share being issued. The transaction, which has been approved
by the Boards of Directors of InfoCast and i360, is subject to approval by
the stockholders of i360 and InfoCast, successful completion of any
regulatory approvals and certain other conditions.

The pro forma acquisition has been accounted for by the purchase
method whereby the pro-forma purchase price is equal to the sum of [i] the
fair value of the 7,584,000 common shares of the Company on the date the
revised terms of the acquisition were announced; [ii] the fair value of the
4,416,000 merger warrants of the Company; and [iii] the fair value of the
1,030,803 stock options of the Company; less [iv] the portion of the
intrinsic value of the unvested merger warrants and stock options of the
Company related to the vesting periods remaining after the pro forma May 3,
2000 acquisition date for those merger warrants and stock options granted
to individuals that are required to continue providing service to the
Company after the acquisition in consideration for the merger warrants and
stock options.

F-50
<PAGE> 103
INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

The fair value of common shares of the Company is assumed to be equal to
the average of the closing share price of the Company's common shares from
May 2, 2000 to May 5, 2000. The fair value of the merger warrants is $4.33
per merger warrant and the fair value of the stock options are $2.46 per
stock option using a Black Scholes valuation model based on a May 3, 2000
assumed grant date, a volatility factor of 0.873, a risk-free interest rate
of 5.95% and an expected life of 2 years. As a result, the total pro forma
purchase price is $54,445,696 and has been allocated as follows:

<TABLE>
<S> <C>
Cash........................................................ $ 1,785,795
Accounts receivable......................................... 72,721
Prepaid expenses and other.................................. 300,554
Capital assets.............................................. 401,587
Deposits and other assets................................... 366,337
Completed technology........................................ 60,000,000
Goodwill.................................................... 17,105,418
Accounts payable and accrued liabilities.................... (1,541,462)
Deferred revenue............................................ (45,254)
Deferred tax liability...................................... (24,000,000)
------------
54,445,696
============
</TABLE>

A former investment advisor of the Company has verbally asserted that
it is entitled to compensation in the amount of 3% of the aggregate
consideration paid by the Company to acquire i360 under an agreement with
the Company in the event that the acquisition of i360 is consummated. The
Company does not believe that it is obligated to the former investment
advisor for any compensation in connection with the acquisition. As of the
date of this pro forma financial statement, the Company is not aware of any
actions taken by the former investment advisor with respect to this claim
other than to advise the Company of its position with respect thereto. The
pro forma financial statements do not include any adjustment to reflect the
payment of this amount.

[d] The creation of deferred compensation of $1,693,911 as at the pro
forma May 3, 2000 acquisition date related to the portion of the intrinsic
value of the 438,750 unvested merger warrants and 462,975 unvested stock
options, that were granted to individuals that are required to continue
providing service to the Company after the acquisition in consideration for
the merger warrants and stock options, related to the remaining vesting
periods of the merger warrants and stock options. The merger warrants will
vest as follows: 25% on February 21, 2000, 25% on September 21, 2000, 25%
on January 21, 2001 and 25% on January 21, 2002. The stock options will
vest as follows: 33% on May 2, 2001, 33% on May 2, 2002, and 33% on May 2,
2003.

[e] The amortization of the $60,000,000 of completed technology and
$17,105,418 of goodwill created by the purchase of i360 by the Company, as
described in [c] above, over the year ended March 31, 2000 on a
straight-line basis utilizing an amortization period of five years. In
addition, the amortization of the $24,000,000 deferred income tax liability
[created by the pro forma purchase of i360 by the Company in respect of the
difference between the tax and accounting basis of the completed
technology] over the period of the underlying asset.

[f] The amortization of the deferred compensation created in [d] above
over the year ended March 31, 2000.

F-51
<PAGE> 104
INFOCAST CORPORATION
[FORMERLY VIRTUAL PERFORMANCE SYSTEMS INC.]
[A DEVELOPMENT STAGE COMPANY]

PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

[g] Deemed preferred stock dividend recorded by i360. On March 8 and
10, 2000, i360 sold 300 shares of Series A convertible preferred shares for
$3,500,000. The 300 shares were convertible into the greater of 9,000,000
shares of common stock or 22.5% of the outstanding stock common stock of
i360 on a fully diluted basis at the discretion of the shareholders at any
time. No stated dividends accrue on the convertible preferred shares and
the holders were entitled to voting rights based upon the number of common
shares into which the preferred shares converted. As a result of the
beneficial conversion feature and given that the fair value of the common
shares into which the preferred stock converts was in excess of the
preferred stock proceeds by an amount in excess of the proceeds as is
required by EITF 98-5, i360 recorded a $3,500,000 deemed preferred stock
dividend. Immediately prior to the merger with the Company, the preferred
stock automatically converted into common shares of i360. As the pro-forma
consolidated statement of operations for the year ended March 31, 2000
assumes that the Company acquired all of the common shares of i360 at the
beginning of the year, the deemed preferred stock dividend has been
eliminated.

F-52
<PAGE> 105

ANNEX A

FAIRNESS OPINION OF MERGER

HOULIHAN LOKEY HOWARD & ZUKIN

June 13, 2000

Board of Directors
c/o Mr. Herve Seguin
Chief Financial Officer
InfoCast Corporation
One Richmond Street West
Suite 902
Toronto, Ontario MSH 3W4
CANADA

Dear Mr. Seguin:

We understand that InfoCast Corporation ("InfoCast" or the "Company") has
entered into an Agreement and Plan of Merger, dated May 3, 2000, with i360 inc.
("i360"), a privately held corporation headquartered in Tucson Arizona, pursuant
to which InfoCast will acquire i360 through a merger of i360 with and into
InfoCast. We further understand that upon the consummation of the merger all of
the outstanding shares of stock of i360 will be converted into an aggregate of
7,584,000 shares of common stock of InfoCast and all outstanding i360 stock
options will be converted into warrants to purchase an aggregate of 4,416,000
shares of InfoCast common stock at an exercise price of $0.30 per share and
options to purchase an aggregate of 1,030,803 shares of InfoCast common stock at
an exercise price of $4.00 per share. Such merger and other related transactions
disclosed to Houlihan Lokey are referred to collectively herein as the
"Transaction."

You have requested our opinion (the "Opinion") as to the matter set forth
below. The Opinion does not address the Company's underlying business decision
to effect the Transaction and does not constitute a recommendation to the Board
of Directors or stockholders of InfoCast as to whether to support or vote in
favor of the Transaction. Furthermore, at your request, we have not negotiated
the Transaction or advised you with respect to alternatives to it.

In connection with this Opinion, we have made such reviews, analyses and
inquiries as we have deemed necessary and appropriate under the circumstances.
Among other things, we have:

1. reviewed InfoCast's audited financial statements for the two fiscal
years ended December 31, 1998 and the three month period ended March 31,
1999, draft audited financial statements for the restated fiscal year ended
March 31, 2000, and unaudited financial statements for the fiscal year
ended December 31, 1999 and three month period ended March 31, 2000, which
InfoCast's management has identified as being the most current financial
statements available;

2. reviewed i360's audited financial statements for the period July
14, 1999 (inception) through December 31, 1999 and unaudited interim
financial statements for the three month period ended March 31, 2000, which
i360's management has identified as being the most current financial
statements available;

3. reviewed copies of various documents including: executed copy of
the Agreement and Plan of Merger by and between InfoCast Corporation and
i360 inc., dated May 3, 2000; InfoCast Business Plan, dated 2000; Amended
and Restated Articles of Incorporation of i360 inc., dated October 14,
1999; i360 inc. Strategic Business Plan, dated January 2000; i360 inc.
Executive Summary, dated January 2000; and i360 inc. Company Summary, dated
April 2000;

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4. had independent meetings with certain members of the senior
management of the Company and i360 to discuss the operations, financial
condition, future prospects and projected operations and performance of the
Company, i360, and the combined company;

5. visited i360's headquarters in Tucson, Arizona;

6. reviewed the analyst report, including projections, for InfoCast,
as a combined company with i360, prepared by SmallCaps Online LLC, dated as
of May 25, 2000;

7. reviewed projections prepared by i360's management with respect to
i360 for the three fiscal years ending March 31, 2002;

8. reviewed pro-forma projections prepared by InfoCast's management
with respect to the consolidated company for the two fiscal years ending
March 31, 2002

9. analyzed the historical market prices and trading volume for the
Company's publicly traded securities;

10. reviewed certain other publicly available financial data for
certain companies that we deem comparable to the Company and i360, and
publicly available prices and premiums paid in other transactions that we
consider similar to the InfoCast/i360 merger;

11. reviewed various industry and research reports for the respective
industries of the Company and i360; and

12. conducted such other studies, analyses and inquiries as we have
deemed appropriate.

We have relied upon and assumed, without independent verification, that all
the financial information, including the financial forecasts and projections,
provided to us have been reasonably prepared and reflect the best currently
available estimates of the future financial results and condition of i360, the
Company, and the combined company and that there has been no material change in
the assets, financial condition, business or prospects of i360, the Company or
the combined company since the date of the most recent financial statements made
available to us.

We have not independently verified the accuracy and completeness of the
information supplied to us with respect to the Company, i360 or the combined
company and do not assume any responsibility with respect to it. We have not
made any physical inspection or independent appraisal of any of the properties,
assets or liabilities of i360 or the Company. You also have informed us, and we
have assumed, that the Transaction will be treated as a tax-free reorganization
for federal income tax purposes Our opinion is necessarily based on business,
economic, market and other conditions as they exist and can be evaluated by us
at the date of this letter. Houlihan Lokey assumes no obligation to update,
revise or reaffirm this Opinion.

The Company and i360, like other companies and any business entities
analyzed by Houlihan Lokey or which are otherwise involved in any manner in
connection with this Opinion, could be materially affected by complications that
may occur, or may be anticipated to occur, in computer-related applications as a
result of the year change from 1999 to 2000 (the "Y2K Issue"). In accordance
with long-standing practice and procedure, Houlihan Lokey's services are not
designed to detect the likelihood and extent of the effect of the Y2K Issue,
directly or indirectly, on the financial condition and/or operations of a
business. Further, Houlihan Lokey has no responsibility with regard to the
Company's and i360's efforts to make its systems, or any other systems
(including its vendors and service providers), Year 2000 compliant on a timely
basis. Accordingly, Houlihan Lokey shall not be responsible for any effect of
the Y2K Issue on the matters set forth in this Opinion.

This opinion has been prepared for the use and benefit of the Board of
Directors of the Company and many not be used for any other purpose without the
written consent of Houlihan Lokey. We are not expressing any opinion as to the
actual value of the InfoCast common stock when issued to the stockholders of
i360

A-2
<PAGE> 107

pursuant to the Transaction, or the prices at which the InfoCast common stock
will trade subsequent to the Transaction.

Based upon the foregoing, and in reliance thereon, it is our opinion that,
as of the date hereof, the consideration to be paid by the Company in connection
with the Transaction is fair to it from a financial point of view.

HOULIHAN LOKEY HOWARD & ZUKIN FINANCIAL ADVISORS, INC.

A-3
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ANNEX B

AGREEMENT AND PLAN OF MERGER

BY AND BETWEEN

INFOCAST CORPORATION

AND

I360 INC.

DATED

MAY 3, 2000

B-1
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TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
ARTICLE I TRANSACTIONS AND TERMS OF THE MERGER................................. 7
Section 1.1 Merger...................................................... 7
Section 1.2 Time and Place of Closing................................... 7
Section 1.3 Effective Time.............................................. 7
Section 1.4 Effects of the Merger....................................... 7
Section 1.5 Certificate of Incorporation................................ 8
Section 1.6 Bylaws...................................................... 8
Section 1.7 Directors and Officers...................................... 8
Section 1.8 Surviving Corporation's Headquarters........................ 8
ARTICLE II EXCHANGE OF SHARES.................................................. 8
Section 2.1 Effect on Capital Stock..................................... 8
Section 2.2 Fractional Shares........................................... 9
Section 2.3 Rights of Former Shareholders of i360....................... 9
Section 2.4 Exchange Procedures......................................... 9
Section 2.5 No Liability................................................ 10
Section 2.6 Lost Certificates........................................... 11
Section 2.7 Dissenting Shares........................................... 11
ARTICLE III REPRESENTATIONS AND WARRANTIES OF i360............................. 11
Section 3.1 Corporate Organization; Requisite Authority to Conduct
Business; Articles of Incorporation and Bylaws.............. 11
Section 3.2 Capitalization and Shareholdings............................ 11
Section 3.3 Subsidiaries, etc........................................... 12
Section 3.4 Authority Relative to and Validity of Agreement............. 12
Section 3.5 Required Filings and Consents; No Conflict.................. 12
Section 3.6 Financial Statements........................................ 12
Section 3.7 No Undisclosed Liabilities.................................. 12
Section 3.8 Absence of Certain Changes and Events....................... 12
Section 3.9 Taxes and Tax Returns....................................... 13
Section 3.10 Employee Benefit Plans...................................... 13
Section 3.11 Title to Property........................................... 14
Section 3.12 Trademarks, Patents and Copyrights.......................... 14
Section 3.13 Legal Proceedings, Claims, Investigations, etc.............. 14
Section 3.14 Insurance................................................... 15
Section 3.15 Material Contracts.......................................... 15
Section 3.16 Certain Transactions........................................ 15
Section 3.17 Broker...................................................... 15
Section 3.18 Environmental Matters....................................... 15
Section 3.19 Illegal Payments............................................ 16
Section 3.20 Compliance with Law......................................... 16
Section 3.21 Receivables................................................. 16
</TABLE>

B-2
<PAGE> 110

<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
Section 3.22 Labor....................................................... 16
Section 3.23 Banks; Safe Deposit Boxes................................... 17
Section 3.24 Books of Account; Records................................... 17
Section 3.25 Reorganization and Regulatory Matters....................... 17
Section 3.26 Employment Agreements....................................... 17
Section 3.27 Stock Option Agreements..................................... 17
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF INFOCAST.......................... 17
Section 4.1 Corporate Organization; Requisite Authority to Conduct
Business.................................................... 17
Section 4.2 Capitalization.............................................. 17
Section 4.3 Subsidiaries, etc........................................... 18
Section 4.4 Authority Relative to and Validity of Agreement............. 18
Section 4.5 Required Filings and Consents; No Conflict.................. 18
Section 4.6 SEC Reports and Financial Statements........................ 18
Section 4.7 No Undisclosed Liabilities.................................. 19
Section 4.8 Absence of Certain Changes and Events....................... 19
Section 4.9 Taxes and Tax Returns....................................... 19
Section 4.10 Employee Benefit Plans...................................... 19
Section 4.11 Title to Property........................................... 20
Section 4.12 Trademarks, Patents and Copyrights.......................... 20
Section 4.13 Legal Proceedings, Claims, Investigations, etc.............. 21
Section 4.14 Insurance................................................... 21
Section 4.15 Material Contracts.......................................... 21
Section 4.16 Certain Transactions........................................ 21
Section 4.17 Broker...................................................... 22
Section 4.18 Environmental Matters....................................... 22
Section 4.19 Illegal Payments............................................ 22
Section 4.20 Compliance with Law......................................... 22
Section 4.21 Receivables................................................. 22
Section 4.22 Labor....................................................... 23
Section 4.23 Books of Account; Records................................... 23
Section 4.24 Reorganization and Regulatory Matters....................... 23
ARTICLE V COVENANTS OF i360.................................................... 23
Section 5.1 Covenants of i360 Regarding Conduct of Business Operations
Pending the Closing......................................... 23
Section 5.2 No Other Negotiations....................................... 24
ARTICLE VI COVENANTS OF INFOCAST............................................... 24
Section 6.1 Conversion of i360 Stock Options............................ 24
Section 6.2 i360 Employee Benefit Plans................................. 25
Section 6.3 Certain Employee Matters.................................... 25
Section 6.4 Indemnification, Exculpation and Insurance.................. 25
</TABLE>

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<PAGE> 111

<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
Section 6.5 Listing on a National Securities Exchange................... 26
Section 6.6 2000 Operational Budget of i360............................. 26
ARTICLE VII ADDITIONAL COVENANTS............................................... 26
Section 7.1 Covenants of All Parties.................................... 26
Section 7.2 Best Efforts................................................ 26
Section 7.3 Compliance.................................................. 26
Section 7.4 Notice...................................................... 26
Section 7.5 Access...................................................... 26
Section 7.6 Confidentiality............................................. 27
Section 7.7 Announcements............................................... 27
Section 7.8 Covenants of Certain i360 Shareholders...................... 27
ARTICLE VIII CONDITIONS PRECEDENT TO OBLIGATIONS OF i360....................... 27
Section 8.1 Representations and Warranties True......................... 27
Section 8.2 Performance of Covenants.................................... 27
Section 8.3 Shareholder Approval........................................ 27
Section 8.4 No Proceedings.............................................. 27
Section 8.5 Consents and Approvals...................................... 27
Section 8.6 Opinion of InfoCast Counsel................................. 28
Section 8.7 Material Changes............................................ 28
Section 8.8 Registration Rights Agreement............................... 28
Section 8.9 Employee Stock Options After Merger......................... 28
Section 8.10 Escrow Agreement............................................ 28
Section 8.11 Shareholder Designee Agreement.............................. 28
ARTICLE IX CONDITIONS PRECEDENT TO OBLIGATIONS OF INFOCAST..................... 29
Section 9.1 Representation and Warranties True.......................... 29
Section 9.2 Performance of Covenants.................................... 29
Section 9.3 Shareholder Approval........................................ 29
Section 9.4 No Proceedings.............................................. 29
Section 9.5 Consents and Approvals...................................... 29
Section 9.6 Opinion of i360's Counsel................................... 29
Section 9.7 Material Changes............................................ 30
Section 9.8 Financial Statements........................................ 30
Section 9.9 Registration Rights Agreement............................... 30
Section 9.10 Dissenting Shares........................................... 30
Section 9.11 Delivery of Questionnaires and Representation Letters....... 30
Section 9.12 Accredited Investors........................................ 30
Section 9.13 Escrow Agreement............................................ 30
Section 9.14 Shareholder Designee Agreement.............................. 30
ARTICLE X INDEMNIFICATION...................................................... 30
Section 10.1 Survival of Representations, Warranties, Covenants and
Agreements.................................................. 30
Section 10.2 Indemnification by i360..................................... 30
</TABLE>

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<PAGE> 112

<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
Section 10.3 Indemnification by InfoCast................................. 30
Section 10.4 Procedures for Indemnification.............................. 31
Section 10.5 Limitations on Indemnification by i360...................... 31
Section 10.6 Mitigation of Losses........................................ 31
Section 10.7 Exclusivity................................................. 31
Section 10.8 Cooperation in Defense...................................... 32
Section 10.9 Escrow Account.............................................. 32
ARTICLE XI CLOSING DOCUMENTS................................................... 32
Section 11.1 Documents to be Delivered by the Parties.................... 32
Section 11.2 Documents to be Delivered by InfoCast....................... 32
Section 11.3 Documents to be Delivered by i360........................... 32
ARTICLE XII TERMINATION, AMENDMENT AND WAIVER.................................. 33
Section 12.1 Termination................................................. 33
Section 12.2 Effect of Termination....................................... 33
ARTICLE XIII MISCELLANEOUS..................................................... 33
Section 13.1 Expenses.................................................... 33
Section 13.2 Notices..................................................... 33
Section 13.3 Entire Agreement; Amendments................................ 34
Section 13.4 Binding Effect, Benefits, Assignments....................... 34
Section 13.5 Applicable Law.............................................. 34
Section 13.6 Arbitration................................................. 34
Section 13.7 Headings.................................................... 34
Section 13.8 Counterparts................................................ 35
Section 13.9 Costs and Fees of Dispute................................... 35
Section 13.10 Definition of Material Adverse Effect....................... 35
</TABLE>

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SCHEDULES

<TABLE>
<S> <C>
Schedule 3.2 Capitalization and Shareholdings
Schedule 3.3 Subsidiaries
Schedule 3.8 Absence of Certain Changes and Events
Schedule 3.10 Employee Benefit Plans
Schedule 3.11 Owned and Leased Property
Schedule 3.12 Trademarks, Patents and Copyrights
Schedule 3.13 Legal Proceedings, Claims and Investigations, Etc.
Schedule 3.14 Insurance
Schedule 3.15 Material Contracts
Schedule 3.16 Certain Transactions
Schedule 3.17 Broker
Schedule 3.23 Banks; Safe Deposit Boxes
Schedule 3.26 Employment Agreements
Schedule 3.27 Stock Option Agreements
Schedule 4.3 Subsidiaries
Schedule 4.7 No Undisclosed Liabilities of InfoCast
Schedule 4.8 Absence of Certain Changes and Events
Schedule 4.9 Taxes and Tax Returns
Schedule 4.10 Employee Benefit Plans
Schedule 4.11 Owned and Leased Property
Schedule 4.14 Insurance
Schedule 4.15 Material Contracts
Schedule 4.17 Broker
</TABLE>

EXHIBITS

<TABLE>
<S> <C>
Exhibit A Escrow Agreement
Exhibit B Shareholders Voting Agreement
Exhibit C Registration Rights Agreement
Exhibit D Investor Questionnaire
Exhibit E Articles of Merger
Exhibit F Shareholder Designee Agreement
Exhibit G i360 Year 2000 Operational Budget
</TABLE>

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AGREEMENT AND PLAN OF MERGER

AGREEMENT AND PLAN OF MERGER (the "Agreement"), dated May 3, 2000, by and
among i360 Inc., a Utah corporation ("i360") and InfoCast Corporation, a Nevada
corporation ("InfoCast").

W I T N E S S E T H:

PREAMBLE

A. The respective Boards of Directors of i360 and InfoCast have approved
the merger of i360 with and into InfoCast (the "Merger"), upon the terms and
subject to the conditions set forth in this Agreement, whereby each issued and
outstanding share of common stock, no par value per share, of i360 ("i360 Common
Stock") will be converted into the right to receive the Merger Consideration (as
defined in Section 2.1).

B. The respective Boards of Directors of InfoCast and i360 have each
determined that the Merger and the other transactions contemplated by this
Agreement are consistent with, and in furtherance of, their respective business
strategies and goals.

C. InfoCast and i360 desire to make certain representations, warranties,
covenants and agreements in connection with the Merger and also to prescribe
various conditions to the Merger.

D. For federal income tax purposes, it is intended that the Merger will
qualify as a reorganization under the provisions of Section 368(a) of the
Internal Revenue Code of 1986, as amended (the "Code").

NOW, THEREFORE, in consideration of the premises and the representations,
warranties, and mutual covenants and agreements herein contained, the parties
hereby agree as follows:

ARTICLE I

TRANSACTIONS AND TERMS OF THE MERGER

Section 1.1 Merger. Subject to the terms and conditions of this
Agreement, at the Effective Time, i360 shall be merged with and into InfoCast
(the "Merger"), in accordance with the provisions of Section 92A.190 of the
General Corporation Law of the State of Nevada (the "Nevada Act") and Section
16-10a-1107 of the Utah Business Corporation Act (the "UBCA"). InfoCast shall be
the surviving corporation of the Merger (the "Surviving Corporation") and shall
succeed to and assume all the rights and obligations of i360 in accordance with
Section 92A.250 of the Nevada Act.

Section 1.2 Time and Place of Closing. The closing of the Merger (the
"Closing") will take place at 10:00 a.m. on a date to be specified by the
parties (the "Closing Date"), which (subject to satisfaction or waiver of the
conditions set forth in Articles VIII and IX) shall be no later than the second
business day after satisfaction of the conditions set forth in Sections 8.4 and
9.4, unless another time or date is agreed to by the parties. The Closing shall
be held at the office of InfoCast's counsel, Olshan Grundman Frome Rosenzweig &
Wolosky LLP, 505 Park Avenue, New York, New York or at such other place as
InfoCast and i360 shall mutually agree.

Section 1.3 Effective Time. Subject to the provisions of this Agreement,
as soon as practicable on or after the Closing Date, the parties shall file
articles of merger or other appropriate documents (the "Articles of Merger"),
executed in accordance with the relevant provisions of the Nevada Act and the
UBCA, and shall make all other filings or recordings required under the Nevada
Act and the UBCA. The Merger and other transactions contemplated by this
Agreement shall become effective on the date and at the time the Articles of
Merger shall become effective with the Secretaries of State of the States of
Nevada and Utah (the "Effective Time").

Section 1.4 Effects of the Merger. The Merger shall have the effects set
forth in Section 92A.250 of the Nevada Act.

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<PAGE> 115

Section 1.5 Certificate of Incorporation. The certificate of
incorporation of InfoCast, as in effect immediately prior to the Effective Time
shall be the certificate of incorporation of the Surviving Corporation until
thereafter changed or amended as provided therein or by applicable law.

Section 1.6 Bylaws. The Bylaws of InfoCast as in effect immediately prior
to the Effective Time shall be the Bylaws of the Surviving Corporation until
otherwise amended or repealed.

Section 1.7 Directors and Officers.

(a) Directors. At the Effective Time, the Board of Directors of InfoCast
shall appoint William G. Cochrane ("Cochrane") and S. Drexel Ridley ("Ridley")
to the Board of Directors of InfoCast, to serve until the next annual meeting of
the shareholders of InfoCast or until the earlier of their resignation or
removal or until their respective successors are duly elected and qualified, as
the case may be, it being agreed that if either Cochrane or Ridley shall be
unable to serve as a director at the Effective Time, i360 shall designate
another individual to serve in such individual's place. At the first annual
meeting of shareholders of InfoCast following the Effective Time, the former
directors of i360 immediately prior to the Effective Time shall nominate for
election to the Board of Directors of InfoCast nominees equaling one-third
( 1/3) of the non-independent members of the Board of Directors of InfoCast and
InfoCast shall recommend that the shareholders of InfoCast elect such nominees
to the Board of Directors of InfoCast. Notwithstanding the provisions of this
Section 1.7(a), the parties agree that the Board of Directors of InfoCast shall
consist of such number of independent directors as is necessary or desirable to
comply with any listing rule of a national exchange or Nasdaq in connection with
the listing of the InfoCast Common Stock on such national exchange or Nasdaq.
The committees of the Board of Directors of the Surviving Corporation will be
elected by the Board of Directors in accordance with the Bylaws, provided that,
if not prohibited by the Securities and Exchange Commission and any listing rule
of any national exchange or Nasdaq as they may apply to InfoCast at that time,
at least one member of the Board of Directors representing the former i360
shareholders shall be appointed to the Nominating Committee and the Compensation
Committee, which obligation terminates simultaneously with the second annual
meeting of shareholders of InfoCast following the Effective Time.

(b) Officers. Cochrane shall serve as a Senior Vice President of InfoCast
and President of its i360 division until the earlier of his resignation or
removal. If Cochrane ceases to be a full-time employee of i360 prior to the
Effective Time, the parties will agree upon another person to serve in his
place.

Section 1.8 Surviving Corporation's Headquarters. The Surviving
Corporation intends to maintain an office in Tucson, Arizona for the continued
operation of the business of i360 after the Merger until at least September 30,
2001 and, thereafter, shall provide the employees in the Tucson office six (6)
months prior written notice of any relocation of the Tucson office outside of
Tucson or closing of the Tucson office by InfoCast.

ARTICLE II

EXCHANGE OF SHARES

Section 2.1 Effect on Capital Stock. Subject to the provisions of this
Article II, at the Effective Time, by virtue of the Merger and without any
action on the part of i360 or the holder of any shares of i360 Common Stock or
on the part of any holder of any shares of the issued and outstanding common
stock of InfoCast, $0.001 par value per share (the "InfoCast Common Stock"):

(a) Shares Held in Treasury. Each of the shares of common stock of
i360 held by i360 as treasury stock shall be canceled and retired at the
Effective Time and no consideration shall be issued in exchange therefor.We
cannot use the definition of i360 Common Stock as it is defined as the
"issued and outstanding" stock of i360.

(b) Conversion of i360 Common Stock. Subject to Section 2.2 hereof and
other than shares to be canceled in accordance with Section 2.1(a) above,
each share of i360 Common Stock issued and outstanding at the Effective
Time shall cease to be outstanding and shall be converted into the right to
receive 0.30 of a fully paid and nonassessable share of InfoCast Common
Stock (the "Merger
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<PAGE> 116

Consideration"). As of the Effective Time, all such shares of i360 Common
Stock shall no longer be outstanding and shall automatically be canceled
and retired and shall cease to exist, and each holder of a certificate
representing any such shares of i360 Common Stock shall cease to have any
rights with respect thereto, except the right to receive the Merger
Consideration and any cash in lieu of fractional shares of InfoCast Common
Stock to be issued or paid in consideration therefor upon surrender of such
certificate in accordance with Section 2.2, without interest. Each
shareholder of i360 shall be required to represent and warrant as a
condition of receiving shares of InfoCast Common Stock that he or she is
acquiring such shares solely for his or her own account for investment
purposes and not with a view to distribution or resale; he or she
understands that upon issuance hereunder none of the InfoCast Common Stock
will be registered under the Securities Act of 1933 (the "Securities Act")
and such shares may not be transferred, assigned or negotiated except
pursuant to an applicable exemption under the Securities Act; that stop
transfer instructions will be issued against all such shares and that the
certificates evidencing the InfoCast Common Stock shall bear the following
legend:

"THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933 (THE "ACT") OR ANY STATE SECURITIES LAWS. THESE SECURITIES MAY NOT
BE SOLD EXCEPT AS PERMITTED UNDER THE ACT AND APPLICABLE STATE
SECURITIES LAWS, PURSUANT TO REGISTRATION OR AN EXEMPTION THEREFROM."

Section 2.2 Fractional Shares. Anything set forth in this Agreement to
the contrary notwithstanding, each holder of shares of i360 Common Stock
exchanged pursuant to the Merger who would otherwise have been entitled to
receive a fraction of a share of InfoCast Common Stock (after taking into
account all certificates delivered by such holder) shall receive, in lieu
thereof, cash (without interest) in an amount equal to the product obtained by
multiplying (A) the fractional share interest to which such holder (after taking
into account all shares of i360 Common Stock held at the Effective Time by such
holder) would otherwise be entitled by (B) the closing price for a share of
InfoCast Common Stock as reported on the OTCBB (as reported in the Wall Street
Journal, or, if not reported therein, any other authoritative source) on the
Closing Date. As soon as practicable after the determination of the amount of
cash, if any, to be paid to holders of i360 Common Stock with respect to any
fractional share interest, the Exchange Agent will make available such amounts
to such holders of i360 Common Stock subject to and in accordance with the terms
of Section 2.4(b). No such holder will be entitled to dividends, voting rights,
or any other rights as a shareholder in respect of any fractional shares.

Section 2.3 Rights of Former Shareholders of i360. At the Effective Time,
the stock transfer book of i360 shall be closed as to holders of i360 Common
Stock immediately prior to the Effective Time and no transfer of i360 Common
Stock by any such holder shall thereafter be made or recognized. Until
surrendered for exchange pursuant to Section 2.4(b) hereof, each certificate
theretofore representing shares of i360 Common Stock shall from and after the
Effective Time represent for all purposes only the right to receive the Merger
Consideration and other cash, if any, which the holder thereof has the right to
receive upon in respect of such certificate pursuant to the provisions of this
Article II, subject, however, to i360's obligation to pay any dividends or make
any other distributions with a record date prior to the Effective Time which
have been declared or made by i360 in respect of such shares of i360 Common
Stock in accordance with the terms of this Agreement and which remain unpaid at
the Effective Time. Whenever a dividend or other distribution is declared by
InfoCast on the shares of InfoCast Common Stock, the record date for which is at
or after the Effective Time, the declaration shall include dividends or other
distributions on all shares of i360 Common Stock issuable pursuant to this
Agreement, but no dividend or other distribution payable to the holders of
record of shares of i360 Common Stock as of any time subsequent to the Effective
Time shall be delivered to the holder of any certificate representing shares of
i360 Common Stock issued and outstanding at the Effective Time unless such
certificate is surrendered pursuant to Section 2.4(b) hereof.

Section 2.4 Exchange Procedures.

(a) Exchange Agent. As of the Effective Time, InfoCast shall enter into an
agreement with such bank or trust company as may be designated by InfoCast and
i360 (the "Exchange Agent"), which shall provide

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that InfoCast shall deposit with the Exchange Agent as of the Effective Time,
for the benefit of the holders of shares of i360 Common Stock and for exchange
in accordance with this Article II, through the Exchange Agent, the Merger
Consideration, together with any dividends or distributions with respect thereto
with a record date after the Effective Time and any cash payable in lieu of any
fractional shares of InfoCast Common Stock issuable pursuant to Section 2.2 in
exchange for issued and outstanding shares of i360 Common Stock.

(b) Exchange Procedures. As soon as reasonably practicable after the
Effective Time, the Exchange Agent shall mail to each holder of record of a
certificate or certificates which immediately prior to the Effective Time
represented outstanding shares of i360 Common Stock (the "Certificates") whose
shares were converted into the right to receive the Merger Consideration
pursuant to Section 2.1(b), (i) a letter of transmittal (which shall specify
that delivery shall be effected, and risk of loss and title to the Certificates
shall pass, only upon delivery of the Certificates to the Exchange Agent and
shall be in such form and have such other provisions as InfoCast and i360 may
reasonably specify) and (ii) instructions for use in effecting the surrender of
the Certificates in exchange for the Merger Consideration. Upon surrender of a
Certificate for cancellation to the Exchange Agent, together with such letter of
transmittal, duly executed, and such other documents as reasonably may be
required by the Exchange Agent, the holder of such Certificate shall be entitled
to receive in exchange therefor a certificate representing that number of whole
shares of InfoCast Common Stock and cash which such holder has the right to
receive pursuant to the provisions of this Article II, and the Certificate so
surrendered shall forthwith be canceled, less the amount of InfoCast Common
Stock subject to the escrow set forth in Section 2.4(c) of this Agreement. In
the event of a transfer of ownership of i360 Common Stock which is not
registered in the transfer records of i360, a certificate representing the
proper number of shares of InfoCast Common Stock may be issued to a person other
than the person in whose name the Certificate so surrendered is registered if
such Certificate shall be properly endorsed or otherwise be in proper form for
transfer and the person requesting such issuance shall pay any transfer or other
taxes required by reason of the issuance of shares of InfoCast Common Stock to a
person other than the registered holder of such Certificate or establish to the
satisfaction of InfoCast that such tax has been paid or is not applicable. Until
surrendered as contemplated by this Section 2.4, each Certificate shall be
deemed at any time after the Effective Time to represent only the right to
receive upon such surrender the Merger Consideration and other cash, if any,
which the holder thereof has the right to receive in respect of such Certificate
pursuant to the provisions of this Article II. No interest will be paid or will
accrue on any cash payable to holders of Certificates pursuant to the provisions
of this Article II.

(c) Escrow Shares. On the Closing Date, InfoCast, i360, Cochrane, Ridley,
LeRoy Hucke and an escrow agent reasonably acceptable to the parties ("Escrow
Agent") shall each execute and deliver the escrow agreement in a form
substantially as set forth on Exhibit A (the "Escrow Agreement"). As soon as
practicable after the Effective Date, InfoCast shall deliver to the Escrow Agent
pursuant to the terms of the Escrow Agreement, either options for the purchase
shares or shares of InfoCast Common Stock which in the aggregate total of
750,000 shares of InfoCast Common Stock (the "Escrow Account"). The options or
shares held in the Escrow Account shall be held to reimburse InfoCast for any
claims it is compelled to pay as a result of the indemnity of former directors
of i360 pursuant to Section 6.4 of this Agreement or to satisfy the claims of
InfoCast pursuant to Section 10.2 of this Agreement for any breach of the
representations and warranties of i360 contained in Article III of this
Agreement.

Section 2.5 No Liability. None of InfoCast, i360 or the Exchange Agent
shall be liable to any person in respect of any shares of InfoCast Common Stock
(or dividends or distributions with respect thereto) delivered to a public
official pursuant to any applicable abandoned property, escheat or similar law.
If any Certificate shall not have been surrendered prior to seven years after
the Effective Time (or immediately prior to such earlier date on which any
Merger Consideration, any cash payable to the holder of such Certificate
representing i360 Common Stock pursuant to this Article II or any dividends or
distributions payable to the holder of such Certificate would otherwise escheat
to or become the property of any Governmental Authority (as defined in Section
3.4), any such Merger Consideration or cash, dividends or distributions in
respect of such Certificate shall, to the extent permitted by applicable law,
become the property of the Surviving Corporation, free and clear of all claims
or interest of any person previously entitled thereto.

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Section 2.6 Lost Certificates. If any Certificate shall have been lost,
stolen or destroyed, upon the making of an affidavit of that fact by the person
claiming such Certificate to be lost, stolen or destroyed and, if required by
the Surviving Corporation, the posting by such person of a bond in such
reasonable amount as the Surviving Corporation may direct as indemnity against
any claim that may be made against it with respect to such Certificate, the
Exchange Agent will issue in exchange for such lost, stolen or destroyed
Certificate the Merger Consideration and, if applicable, any cash in lieu of
fractional shares, and unpaid dividends and distributions on shares of InfoCast
Common Stock deliverable in respect thereof, pursuant to this Agreement.

Section 2.7 Dissenting Shares. Notwithstanding anything in this Agreement
to the contrary, shares of i360 Common Stock outstanding immediately prior to
the Effective Time held by a holder (if any) who is entitled to demand, and who
properly demands, appraisal for such shares in accordance with Section
16-10a-1301 of the UBCA ("Dissenting Shares") shall not be converted into a
right to receive Merger Consideration unless such holder fails to perfect or
otherwise loses such holder's right to appraisal, if any. If after the Effective
Time such holder fails to perfect or loses any such right to appraisal, such
Dissenting Shares shall be treated as if they had been converted as of the
Effective Time into a right to receive Merger Consideration pursuant to Section
2.1(b). i360 shall give prompt written notice to InfoCast of any demands
received by i360 for appraisal of shares of i360 Common Stock and InfoCast shall
have the right to participate in negotiations and proceedings with respect to
such demands. Prior to the Effective Time, i360 shall not, except with the prior
written consent of InfoCast, which consent shall not be unreasonably withheld,
make any payment with respect to, or settle or offer to settle, any such
demands. Any Merger Consideration that would otherwise have been allocated to
the Dissenting Shares if the holders thereof had not properly perfected their
appraisal rights will not be paid under Section 2.1(b).

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF i360

i360 hereby represents and warrants to InfoCast, as of the date of this
Agreement, as follows:

Section 3.1 Corporate Organization; Requisite Authority to Conduct
Business; Articles of Incorporation and Bylaws. i360 is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Utah. i360 has provided InfoCast with true and complete copies of its articles
of incorporation (certified by the Secretary of State of the State of Utah) and
Bylaws (certified by the Secretary of i360) in effect on the date hereof. Prior
to the Closing, the minute books of i360 will be made available to InfoCast for
inspection, and will contain true and complete records of all meetings and
consents in lieu of meeting of i360's Board of Directors and of i360's
stockholders since the incorporation of i360, which accurately reflect all
transactions referred to in such minutes and consents in lieu of meeting. i360
has all corporate power and authority to own, operate and lease its properties
and to carry on its business as the same is now being conducted. i360 is duly
qualified or licensed to do business and is in good standing as a foreign
corporation in every jurisdiction in which the conduct of its business or the
ownership or leasing of its properties requires it to be so qualified or
licensed except where the failure to be so duly qualified or licensed will not
have a material adverse effect on i360's business.

Section 3.2 Capitalization and Shareholdings. The authorized capital
stock of i360 consists of (i) 75,000,000 shares of common stock, 16,280,000 of
which are issued and outstanding; (ii) 5,000,000 shares of preferred stock, 300
of which are issued and outstanding and convertible into 9,000,000 shares of
common stock of i360, (iii) options to purchase an additional 14,720,000 shares
of i360 Common Stock at an exercise price of $0.10 per share, and (iv) options
to purchase an additional 3,436,010 shares of i360 Common Stock at an exercise
price of $1.33 per share. The capital stock of i360 is duly authorized and all
issued capital stock has been duly and validly issued and is fully paid and
non-assessable and free of preemptive rights. Except as disclosed on SCHEDULE
3.2, there is not outstanding, and i360 is not bound by or subject to, any
subscription, option, warrant, call, right, contract, commitment, agreement,
understanding or arrangement to issue any additional shares of capital stock of
i360, including any right of conversion or exchange under any outstanding
security or other instrument, and no shares are reserved for issuance for any
purpose.

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Section 3.3 Subsidiaries, etc. Except as set forth on SCHEDULE 3.3, i360
does not own (directly or indirectly) any equity interest in any corporation,
partnership, limited liability company, joint venture, association or other
entity.

Section 3.4 Authority Relative to and Validity of Agreement. i360 has the
requisite corporate power and authority to execute and deliver this Agreement
and to assume and perform all of its obligations hereunder. The execution and
delivery of this Agreement by i360 and the performance by i360 of its
obligations hereunder has been duly authorized by its Board of Directors and,
subject to the approval of the stockholders of i360, no further authorization on
the part of i360 is necessary to authorize the execution and delivery by it of,
and the performance of its obligations under, this Agreement. There are no
corporate, contractual, statutory or other restrictions of any kind upon the
power and authority of i360 to execute and deliver this Agreement and to
consummate the transactions contemplated hereunder and no action, waiver or
consent by any foreign, federal, state, municipal or other governmental
department, commission or agency ("Governmental Authority") is necessary to make
this Agreement a valid instrument binding upon i360 in accordance with its
terms. This Agreement has been duly executed and delivered by i360 and
constitutes, legal, valid and binding obligations of i360 enforceable in
accordance with their terms, except (i) as such enforceability may be limited
subject to any bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting creditors' rights generally, (ii) as such obligations are
subject to general principles of equity and (iii) as rights to indemnity may be
limited by federal or state securities laws or by public policy.

Section 3.5 Required Filings and Consents; No Conflict. i360 is not
required to submit any notice, report or other filing with any Governmental
Authority in connection with the execution, delivery or performance of this
Agreement by i360. The consummation of the transactions contemplated hereby do
not and will not (a) conflict with or violate any law, regulation, judgment,
order or decree binding upon i360, (b) conflict with or violate any provision of
its certificate of incorporation charter or bylaws, or (c) conflict with or
result in a breach of any condition or provision of, or constitute a default (or
an event which with notice or lapse of time or both would become a default)
under, or result in the creation or imposition of any lien, charge or
encumbrance upon any properties or assets of i360 pursuant to, or cause or
permit the acceleration prior to maturity of any amounts owing under, any
indenture, loan agreement, mortgage, deed of trust, lease, contract, license,
franchise or other agreement or instrument to which i360 is a party or which is
or purports to be binding upon i360 or by which any of its properties are bound.
The execution, delivery and performance of this Agreement by i360 and the
consummation of the transactions contemplated hereby will not result in the loss
of any license, franchise, legal privilege or permit possessed by i360 or give a
right of termination to any party to any agreement or other instrument to which
i360 is a party or by which any of its properties are bound.

Section 3.6 Financial Statements. i360 has heretofore delivered to
InfoCast a true and complete copy of its audited balance sheet, income statement
and statement of operations covering the period from i360's date of inception
through for the fiscal year ended December 31, 1999 and will deliver within
seven (7) days following the date of this Agreement the quarterly unaudited
balance sheet, statement of operations, and statement of cash flow of i360 for
the period ended March 31, 2000 (together with the related notes, such financial
statements are referred to in this Agreement as the "Financial Statements"). The
Financial Statements have in all material respects been prepared in accordance
with United States generally accepted accounting principles ("U.S. GAAP")
applied on a consistent basis throughout the periods involved (except as may be
indicated therein or in the notes thereto) and fairly present the financial
position of i360 as of the date thereof and the results of operations of i360
for the periods indicated.

Section 3.7 No Undisclosed Liabilities. i360 has no debts, liabilities or
obligations of any kind, whether accrued, absolute, contingent or other, whether
due or to become due in excess of $25,000 in the aggregate, except as (i) shown
in the Financial Statements, or (ii) incurred in the ordinary course of business
since March 31, 2000.

Section 3.8 Absence of Certain Changes and Events. Except as set forth on
SCHEDULE 3.8, since March 31, 2000, there has not been, with respect to i360,
(i) any Material Adverse Effect; (ii) any strike, picketing, work slowdown or
labor disturbance; (iii) any material damage, destruction or loss (whether or
not

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covered by insurance) with respect to any assets or properties; (iv) any
redemption or other acquisition by it of i360 Common Stock or any declaration or
payment of any dividend or other distribution in cash, stock or property with
respect thereto; (v) except in connection with or as contemplated by this
Agreement, any entry into any commitment or transaction (including, without
limitation, any borrowing or capital expenditure) other than in the ordinary
course of business; (vi) any transfer of, or rights granted under, any leases,
licenses, agreements, patents, trademarks, trade names, or copyrights other than
those transferred or granted in the ordinary course of business and consistent
with past practice; (vii) any mortgage, pledge, security interest or imposition
of any other encumbrance on any assets or properties except in the ordinary
course of business; any payment of any debts, liabilities or obligations
("Liabilities") of any kind other than Liabilities currently due; any
cancellation of any debts or claims or forgiveness of amounts owed to i360; or
(viii) any change in accounting principles or methods (except insofar as may
have been required by a change in U.S. GAAP). Since March 31, 2000, i360 has
conducted its business only in the ordinary course and in a manner consistent
with past practice and has not made any material change in the conduct of its
business or operations. Without limiting the generality of the foregoing, since
March 31, 2000, i360 has not made any payments (except in the ordinary course of
business and in amounts and in a manner consistent with past practice) under any
i360 Employee Plan (as defined in Section 3.10) or to any employee, independent
contractor or consultant, entered into any new i360 Employee Plan or any new
consulting agreement, granted or established any awards under any such i360
Employee Plan or agreement, in any such case providing for payments of more than
$25,000 or adopted or otherwise amended any of the foregoing.

Section 3.9 Taxes and Tax Returns.

(a) For purposes of this Agreement, (i) the term "Taxes" shall mean all
taxes, charges, fees, levies or other assessments, including, without
limitation, income, gross receipts, excise, property, sales, license, payroll
and franchise taxes, imposed by any Governmental Authority whether computed on a
unitary, combined or any other basis; and such term shall include any interest
and penalties or additions to tax; and (ii) the term "Tax Return" shall mean any
report, return or other information required to be filed with, supplied to or
otherwise made available to a taxing authority for any Governmental Authority in
connection with Taxes.

(b) i360 has (i) duly filed with the appropriate taxing authorities for any
Governmental Authority all Tax Returns required to be filed by or with respect
to i360, or are properly on extension and all such duly filed Tax Returns are
true, correct and complete in all respects, and (ii) paid in full or made
adequate provisions for on its balance sheet (in accordance with U.S. GAAP) all
Taxes shown to be due on such Tax Returns. There are no liens for Taxes upon the
assets of i360 except for statutory liens for current Taxes not yet due and
payable or which may thereafter be paid without penalty or are being contested
in good faith. i360 has not received any notice of audit, is not undergoing any
audit of its Tax Returns, and has not received any notice of deficiency or
assessment from any taxing authority with respect to liability for Taxes of i360
which has not been fully paid or finally settled. There have been no waivers of
statutes of limitations by i360 with respect to any Tax Returns which relate to
i360. i360 has not filed a request with the Internal Revenue Service for changes
in accounting methods within the last two years which change would effect the
accounting for tax purposes, directly or indirectly, of i360.

Section 3.10 Employee Benefit Plans. SCHEDULE 3.10 hereto comprises a
listing of each bonus, stock option, stock purchase, benefit, profit sharing,
savings, retirement, liability, insurance, incentive, deferred compensation, and
other similar fringe or employee benefit plans, programs or arrangements for the
benefit of or relating to, any employee of, or independent contractor or
consultant to, and all other compensation practices, policies, terms or
conditions, whether written or unwritten (the "i360 Employee Plans") which i360
presently maintains, to which i360 presently contributes or under which i360 has
any liability and which relate to employees or independent contractors of i360.
The i360 Employee Plans administered by i360 have been administered in all
respects in accordance with all requirements of applicable law and terms of each
such plan. Each i360 Employee Plan that is required or intended to be qualified
under applicable law or registered or approved by a Governmental Authority, has
been so qualified, registered or approved by the appropriate Governmental
Authority and nothing has occurred since the date of the last qualification,
registration or approval to adversely affect, or cause, the appropriate
Governmental Authority to revoke such qualification, registration or approval.
All contributions (including premiums) required by law or contract to have been
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made or approved by i360 under or with respect to i360 Employee Plans have been
paid or accrued by i360. Without limiting the foregoing, there are no unfunded
liabilities under any i360 Employee Plan. i360 has not received notice of any
investigations, litigation or other enforcement actions against i360 with
respect to any of i360 Employee Plans. There are no pending actions, suits or
claims by former or present employees of i360 (or their beneficiaries) with
respect to i360 Employee Plans or the assets or fiduciaries thereof (other than
routine claims for benefits).

Section 3.11 Title to Property. i360 has good and marketable title, or
valid leasehold rights (in the case of leased property), to all real property
and all personal property purported to be owned or leased by it or used in the
operation of its business, free and clear of all encumbrances, excluding (i)
liens for taxes, fees, levies, imposts, duties or governmental charges of any
kind which are not yet delinquent or are being contested in good faith by
appropriate proceedings which suspend the collection thereof; (ii) liens for
mechanics, materialmen, laborers, employees, suppliers or others which are not
yet delinquent or are being contested in good faith by appropriate proceedings;
(iii) liens created in the ordinary course of business in connection with the
leasing or financing of office, computer and related equipment and supplies;
(iv) easements and similar encumbrances ordinarily created for fuller
utilization and enjoyment of property; and (v) liens or defects in title or
leasehold rights that either individually or in the aggregate do not and will
not have a Material Adverse Effect. All of such owned or leased property with a
value in excess of $5,000 is listed on SCHEDULE 3.11 hereto.

Section 3.12 Trademarks, Patents and Copyrights.

(a) For purposes of this Agreement, the term "i360 Rights" shall mean all
worldwide intellectual property rights, including, without limitation, each
patent, patent right, license, patent application, trade name, trademark,
trademark registration, copyright, copyright registration, copyright
application, service mark, brand mark, brand name and trade secrets relating to
or arising from any proprietary process, formula, source or object code, owned
or possessed by i360. i360 owns or has the right to use, sell or license all
i360 Rights and such i360 Rights are sufficient for the conduct of i360's
businesses as being conducted as of the date hereof. SCHEDULE 3.12(A) hereto
lists each of the i360 Rights owned or possessed by i360;

(b) The execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated hereby will not constitute a
breach of any instrument or agreement governing any of the i360 Rights, will not
cause the forfeiture or termination or give rise to a right of forfeiture or
termination of any of the i360 Rights or impair the right of i360 to use, sell
or license any of the i360 Rights or any portion thereof;

(c) Except as disclosed on SCHEDULE 3.12(C), neither the manufacture,
marketing, license, sale or intended use of any product or service currently
licensed or sold by i360 or currently under development by i360 violates any
license or agreement between i360 and any third party relating to such product
or service or infringes any intellectual property right of any other party, and
there is no pending or, to the knowledge of i360, threatened claim or litigation
contesting the validity, ownership or right to use, sell, license or dispose of
any of the i360 Rights nor, to the knowledge of i360 is there any basis for any
such claim, nor has i360 received any notice asserting that any of the i360
Rights or the proposed use, sale, license or disposition thereof conflicts or
will conflict with the rights of any other party, nor, to the best knowledge of
i360, is there any basis for any such assertion; and

(d) Except as disclosed on SCHEDULE 3.12(D), no current or prior officers,
employees or consultants of i360 claim an ownership interest in any of the i360
Rights as a result of having been involved in the development of such property
while employed by or consulting to i360 or otherwise.

Section 3.13 Legal Proceedings, Claims, Investigations, etc. Except as
set forth on SCHEDULE 3.13, here is no legal, administrative, arbitration or
other action or proceeding or governmental investigation pending or to the
knowledge of i360, threatened, against i360, any director, officer or employee
thereof relating to i360's business. i360 has not been informed of any violation
of or default under, any laws, ordinances, regulations, judgments, injunctions,
orders or decrees (including without limitation, any immigration laws or
regulations) of any Governmental Authority or arbitrator applicable to the
business of i360. i360 is not currently subject to

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any judgment, order, injunction or decree of any court, arbitral authority,
administrative agency or other Governmental Authority.

Section 3.14 Insurance. SCHEDULE 3.14 hereto sets forth a list and brief
description of all existing insurance policies maintained by i360 pertaining to
its business properties, personnel or assets. i360 is not in default with
respect to any material provision contained in any insurance policy, and has not
failed to give any notice or present any claim under any insurance policy in due
and timely fashion. Prior to the Closing, all such policies shall have been
delivered to InfoCast and are in full force and effect. All payments with
respect to such policies are current and i360 has not received any notice
threatening a suspension, revocation, modification or cancellation of any such
policy.

Section 3.15 Material Contracts.

(a) Except as set forth on SCHEDULE 3.15 hereto, i360 is not a party to and
is not bound by any contract or has any commitment, whether written or oral
which has a term in excess of one year and will result in payments in excess of
$25,000 other than (i) contracts or commitments entered into in the ordinary
course of business with vendors and customers and (ii) contracts or commitments
cancelable upon not more than 30 days' notice. Each of the contracts and
commitments set forth on SCHEDULE 3.15 hereto and each of the other contracts
and commitments to which i360 is a party, is valid and existing, in full force
and effect and enforceable in accordance with its terms, subject to any
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally, general equitable principles and
limitations on rights to indemnity by federal or state securities laws or by
public policy, and to the knowledge of i360, there is no material default or
claim of default against i360 or any notice of termination with respect thereto.
i360 has complied in all material respects with all requirements of, and
performed all of its obligations under, such contracts and commitments. In
addition, no other party to any such contract or commitment is, to the knowledge
of i360, in default under or in breach of any material term or provision
thereof, and to the knowledge of i360, there exists no condition or event which,
after notice or lapse of time or both, would constitute a material default by
any party to any such contract or commitment. Copies of all the written
documents and a synopsis of all oral contracts and commitments described on
SCHEDULE 3.15 hereto have heretofore been made available to InfoCast and are
true and complete and include all amendments and supplements thereto and
modifications thereof to and including the date hereof.

(b) Except as set forth on SCHEDULE 3.15, i360 is not a party to any oral
or written (i) agreement with any consultant, executive officer or other key
employee the benefits of which are contingent, or the terms of which are
materially altered, upon the occurrence of the transactions contemplated by this
Agreement, or (ii) agreement or plan, including any stock option plan and the
like, any of the benefits of which will be increased, or the vesting of the
benefits of which will be accelerated, by the occurrence of the transactions
contemplated by this Agreement.

Section 3.16 Certain Transactions. Except as set forth on SCHEDULE 3.16,
no officer, director or any employee of i360, or any member of any such person's
immediate family is presently a party to any contract, arrangement or
understanding with i360 (i) providing for the furnishing of services by, (ii)
providing for the rental of real or personal property from, or (iii) otherwise
requiring payments to (other than for services as officers, directors or
employees of i360), any such person or any corporation, partnership, trust or
other entity in which any such person has a substantial interest as a
stockholder, officer, director, trustee or partner.

Section 3.17 Broker. Except as set forth on SCHEDULE 3.17, no broker,
finder or investment banker is entitled to any brokerage or finder's fee or
other commission in connection with the transactions contemplated hereby based
on the arrangements made by or on behalf of i360.

Section 3.18 Environmental Matters.

(a) i360 is not the subject of, or to the knowledge of i360, being
threatened to be the subject of (i) any enforcement proceeding, or (ii) any
investigation, brought in either case under any federal, state or local
environmental law, rule, regulation, or ordinance at any time in effect or (iii)
any third party claim relating to environmental conditions on or off the
properties of i360. i360 has not been notified that it must obtain any permits
and licenses or file documents for the operation of its business under federal,
state and local laws
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relating to pollution protection of the environment. i360 has not been notified
of any conditions on or off the properties of i360 which will give rise to any
liabilities, known or unknown, under any federal, state or local environmental
law, rule, regulation or ordinance, or as the result of any claim of any third
party. For the purposes of this Section 3.18, an investigation shall include,
but is not limited to, any written notice received by i360 which relates to the
onsite or offsite disposal, release, discharge or spill of any waste, waste
water, pollutant or contaminants.

(b) There are no toxic wastes or other toxic or hazardous substances or
materials, pollutants or contaminants which i360 (or, to the knowledge of i360,
any previous occupant of i360's facilities) has used, stored or otherwise held
in or on any of the facilities of i360, which, are present at or have migrated
from the facilities, whether contained in ambient air, surface water,
groundwater, land surface strata. The facilities have been maintained by i360 in
compliance with all environmental protection, ordinances, restrictions,
licenses, and regulations. i360 has not disposed of or arranged (by contract,
agreement or otherwise) for the disposal of any materials that was generated or
used by i360 at any off-site location that has been or is listed or proposed for
inclusion on any list promulgated by any Governmental Authority for the purpose
of identifying sites which pose a danger to health and safety. There have been
no environmental studies, reports and analyses made or prepared in the last year
relating to the facilities of i360. i360 has not installed any underground
storage tanks in any of its facilities and none of such facilities contain any
underground storage tanks.

Section 3.19 Illegal Payments. i360 has not, directly or indirectly, paid
or delivered any fee, commission or other sum of money or item of property,
however characterized, to any finder, agent, government official or other party,
in the United States or any other country, which is in any manner related to the
business or operations of i360, which i360 knows or has reason to believe to
have been illegal under any federal, state or local laws or the laws of any
other country having jurisdiction.

Section 3.20 Compliance with Law. i360 has complied in all respects with
all laws, rules, regulations, arbitral determinations, orders, writs, decrees
and injunctions which are applicable to or binding upon i360 or its properties,
the non-compliance with which could reasonably be expected to constitute a
Material Adverse Effect.

Section 3.21 Receivables. Each account receivable reflected on the
balance sheet of i360 at March 31, 2000 represents a valid obligation owed to
i360. All such accounts receivable arising between the date hereof and the
Effective Time are or will be valid and subsisting, represent or will represent
sales actually made, arose or will arise in the ordinary and usual course of the
business of i360 and to the extent not collected prior to the Effective Time, to
the knowledge of i360, will be collected according to their terms subject to
allowances for doubtful accounts set forth on the balance sheet. No payment
reflected on such books and records as having been made on any such account
receivable was made by any director, officer, employee or agent of i360 unless
such person is shown on said books and records as the account debtor. To the
knowledge of i360, there are no defenses, claims of disabilities, counterclaims,
offsets, refusals to pay or other rights of set-off against any accounts
receivable and there is no threatened, intended or proposed defense, claim or
disability, counterclaim, offset, refusal to pay or other right of set-off with
respect thereto.

Section 3.22 Labor. i360 is not a party to any labor contract. i360 has
not received any notice from any labor union or group of employees that such
union or group represents or believes or claims it represents or intends to
represent any of the employees of i360; no strike or work interruption by any of
its employees is planned, under consideration, to the knowledge of i360,
threatened or imminent; there are no repeat, serious or willful safety issues
pending under the federal Occupation Health and Safety Act (OSHA) related to any
of the i360 employees; and neither i360 nor any officer or director thereof has
made any loan or given anything of value, directly or indirectly, to any
officer, official, agent or representative of any labor union or group of
employees. At no time during the past year has i360 experienced any threats of
strikes, work stoppages or demands for collective bargaining by any union or
labor organization or any other group or other organization of employees, any
grievances, disputes or controversies with any union or any other group or other
organization of employees, or any pending or threatened court of arbitration
proceedings involving an employment grievance, dispute or controversy. i360 is
not delinquent in payments to any of its employees for any wages, salaries,
commissions, bonuses or other direct compensation for any services performed by
them to the date

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hereof or amounts required to be reimbursed to such employees. In the event of
termination of the employment of any said employees, neither i360 nor InfoCast
will by reason of anything done by i360 prior to the Closing be liable to any of
said employees for so-called "severance pay" or any other payments.

Section 3.23 Banks; Safe Deposit Boxes. SCHEDULE 3.23 hereto lists the
names and locations of all banks at which i360 has an account and/or safe
deposit box, the numbers of any such accounts and the names of all persons
authorized to draw thereon or to have access thereto.

Section 3.24 Books of Account; Records. The general ledgers, books of
account and other records of i360 are complete and correct, have been maintained
in accordance with good business practices and the matters contained therein are
appropriately and accurately reflected in the Financial Statement.

Section 3.25 Reorganization and Regulatory Matters. i360 has not taken
any action nor does it have any knowledge of any fact or circumstance that is
reasonably likely to (i) prevent the Merger from qualifying as a reorganization
within the meaning of Section 368(a) of the Code, or (ii) materially impede or
delay receipt of any consents of any Governmental Authority or result in the
imposition of a condition or restriction of the type that would have a Material
Adverse Effect on the economic or business benefits of the transaction
contemplated by this Agreement.

Section 3.26 Employment Agreements. SCHEDULE 3.26 hereto lists the names
of all employees with whom i360 has an employment agreement.

Section 3.27 Stock Option Agreements. SCHEDULE 3.27 attached hereto lists
the names of all parties with whom i360 has a stock option agreement and the
terms of such stock option agreements, including such terms as vesting schedule,
exercise price, expiration date and change of control provisions.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF INFOCAST

InfoCast hereby represents and warrants to i360 as follows:

Section 4.1 Corporate Organization; Requisite Authority to Conduct
Business. InfoCast is a corporation duly organized, validly existing and in
good standing under the laws of Nevada. InfoCast has provided i360 with true and
complete copies of its certificate of incorporation (certified by the Secretary
of State of the State of Nevada and Bylaws (certified by the Secretary of
InfoCast) as in effect on the date hereof. InfoCast has full corporate power and
authority to own, operate and lease its properties and to carry on its business
as the same is now being conducted. InfoCast is duly qualified or licensed to do
business and is in good standing as a foreign corporation in every jurisdiction
in which the conduct of its business or the ownership or leasing of its
properties requires it to be so qualified or licensed except where the failure
to be so duly qualified or licensed will not have a Material Adverse Effect on
InfoCast's business.

Section 4.2 Capitalization. The authorized capital stock of InfoCast
consists of (i) 100,000,000 shares of InfoCast Common Stock, $0.001 par value,
and (ii) 100,000,000 shares of preferred stock (none of which are issued and
outstanding). As of March 31, 2000, there were 21,244,128 shares of InfoCast
Common Stock outstanding, not including (i) 3,327,208 shares of InfoCast Canada
Corporation exchangeable on a one-for-one basis for shares of InfoCast Common
Stock, (ii) outstanding options to purchase 2,000,000 shares of InfoCast Common
Stock at an exercise price of $1.00 per share, (iii) options and warrants to
purchase an additional 2,375,000 shares of InfoCast Common Stock at an exercise
price of $7.00 per share, (iv) options to purchase an additional 375,000 shares
of InfoCast Common Stock at an exercise price of $7.05 per share, (v) options to
purchase an additional 60,000 shares of InfoCast Common Stock at any exercise
price of $8.25 per share, (vi) warrants to purchase 12,500 shares of InfoCast
Common Stock at an exercise price of $8.75 per share, (vii) warrants to purchase
an additional 12,500 shares of InfoCast Common Stock at an exercise price of
$7.62 per share, (viii) warrants to purchase an additional 56,000 shares of
InfoCast Common Stock at $5.00 per share, (ix) options to purchase an additional
100,000 shares of InfoCast Common Stock at an exercise price of $8.625 per
share, (x) 1,000,000 shares of InfoCast Common Stock issuable upon conversion of
InfoCast's 7% Convertible Subordinated Debentures and (xi) 833,334 shares of
InfoCast Common Stock
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issuable upon exercise of common stock purchase warrants at an exercise price of
$7.50 per share. The capital stock of InfoCast is duly authorized and all issued
capital stock has been duly and validly issued and is fully paid and
nonassessable and free of preemptive rights. The Merger Consideration is duly
authorized and when issued in accordance with the terms and conditions of this
Agreement shall be validly issued, fully paid and nonassessable. The Merger
Consideration is not subject to any preemptive rights or other similar
restrictions.

Section 4.3 Subsidiaries, etc. Except as set forth on SCHEDULE 4.3,
InfoCast does not own (directly or indirectly) any equity interest in any
corporation, partnership, limited liability company, joint venture, association
or other entity.

Section 4.4 Authority Relative to and Validity of Agreement. InfoCast has
the requisite corporate power and authority to execute and deliver this
Agreement and to assume and perform all of its obligations hereunder. The
execution and delivery of this Agreement by InfoCast and the performance by
InfoCast of its obligations hereunder has been duly authorized by its Board of
Directors and, subject to the approval of the stockholders of InfoCast, no
further authorization on the part of InfoCast is necessary to authorize the
execution and delivery by it of, and the performance of its obligations under,
this Agreement. There are no corporate, contractual, statutory or other
restrictions of any kind upon the power and authority of InfoCast to execute and
deliver this Agreement and to consummate the transactions contemplated hereunder
and no action, waiver or consent by any Governmental Authority is necessary to
make this Agreement a valid instrument binding upon InfoCast in accordance with
its terms. This Agreement has been duly executed and delivered by InfoCast and
constitutes, legal, valid and binding obligations of InfoCast enforceable in
accordance with their terms, except (i) as such enforceability may be limited
subject to any bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting creditors' rights generally, (ii) as such obligations are
subject to general principles of equity and (iii) as rights to indemnity may be
limited by federal or state securities laws or by public policy.

Section 4.5 Required Filings and Consents; No Conflict. Other than state
"Blue Sky" laws relating to the issuance of the Merger Consideration, InfoCast
is not required to submit any notice, report or other filing with any
Governmental Authority in connection with the execution, delivery or performance
of this Agreement by InfoCast. The consummation of the transactions contemplated
hereby do not and will not (a) conflict with or violate any law, regulation,
judgment, order or decree binding upon InfoCast, (b) conflict with or violate
any provision of its Certificate of Incorporation or bylaws, or (c) conflict
with or result in a breach of any condition or provision of, or constitute a
default (or an event which with notice or lapse of time or both would become a
default) under, or result in the creation or imposition of any lien, charge or
encumbrance upon any properties or assets of InfoCast pursuant to, or cause or
permit the acceleration prior to maturity of any amounts owing under, any
indenture, loan agreement, mortgage, deed of trust, lease, contract, license,
franchise or other agreement or instrument to which InfoCast is a party or which
is or purports to be binding upon InfoCast or by which any of its properties are
bound. The execution, delivery and performance of this Agreement by InfoCast and
the consummation of the transactions contemplated hereby will not result in the
loss of any license, franchise, legal privilege or permit possessed by InfoCast
or give a right of termination to any party to any agreement or other instrument
to which InfoCast is a party or by which any of its properties are bound.

Section 4.6 SEC Reports and Financial Statements. InfoCast has heretofore
made available to i360 true and complete copies of all forms, reports,
schedules, statements and other documents filed with the Securities and Exchange
Commission ("SEC") pursuant to the Securities Act of 1933, as amended (the
"Securities Act") or required to be filed under the Securities Exchange Act of
1934, as amended (the "Exchange Act") since September 15, 1999 (as such
documents have been amended or supplemented since the time of their filing,
collectively, the "SEC Reports"). InfoCast has filed with the SEC all forms,
reports, schedules, statements and other documents required to be filed by
InfoCast pursuant to the Exchange Act. As of their respective dates, the SEC
Reports (including without limitation, any financial statements or schedules
included therein) and any offering memorandum issued by InfoCast pursuant to
Regulation D (a) did not contain any untrue statement of a material fact or omit
a material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading, and (b) complied in all material respects with the applicable
requirements of the Securities
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Act and the Exchange Act (as the case may be) and all applicable statutes, rules
and regulations thereunder. Each of the consolidated financial statements
included in the SEC Reports (the "InfoCast Financial Statements") have been
prepared from, and are in accordance with, the books and records of InfoCast,
comply in all material respects with applicable accounting requirements and with
the published rules and regulations of the SEC with respect thereto, have been
prepared in accordance with U.S. GAAP applied on a consistent basis during the
periods involved (except as may be indicated in the notes thereto) and fairly
present in all material respects the consolidated results of operations and cash
flows (and changes in financial position, if any) of InfoCast as at the dates
thereof or for the periods presented therein. InfoCast does not know of any
reason related to the SEC Reports why the InfoCast Common Stock could not be
admitted for listing on a national securities exchange or quoted on Nasdaq
subsequent to the Merger.

Section 4.7 No Undisclosed Liabilities. Except as described in the SEC
Reports or on SCHEDULE 4.7, InfoCast has no debts, liabilities or obligations of
any kind, whether accrued, absolute, contingent or other, whether due or to
become due, except as (i) shown in the InfoCast Financial Statements, or (ii)
incurred in the ordinary course of business since December 31, 1999.

Section 4.8 Absence of Certain Changes and Events. Except as set forth on
SCHEDULE 4.8 and since December 31, 1999, there has not been, with respect to
InfoCast, (i) any Material Adverse Effect; (ii) any strike, picketing, work
slowdown or labor disturbance; (iii) any material damage, destruction or loss
(whether or not covered by insurance) with respect to any assets or properties;
(iv) any redemption or other acquisition by it of InfoCast Common Stock or any
declaration or payment of any dividend or other distribution in cash, stock or
property with respect thereto; (v) except in connection with or as contemplated
by this Agreement, any entry into any commitment or transaction (including,
without limitation, any borrowing or capital expenditure) other than in the
ordinary course of business; (vi) any transfer of, or rights granted under, any
leases, licenses, agreements, patents, trademarks, trade names, or copyrights
other than those transferred or granted in the ordinary course of business and
consistent with past practice; (vii) any mortgage, pledge, security interest or
imposition of any other encumbrance on any assets or properties except in the
ordinary course of business; any payment of any Liabilities of any kind other
than Liabilities currently due; any cancellation of any debts or claims or
forgiveness of amounts owed to InfoCast; or (viii) any change in accounting
principles or methods (except insofar as may have been required by a change in
U.S. GAAP). Since December 31, 1999, InfoCast has conducted its business only in
the ordinary course and in a manner consistent with past practice and has not
made any material change in the conduct of its business or operations. Without
limiting the generality of the foregoing, since December 31, 1999, InfoCast has
not made any payments (except in the ordinary course of business and in amounts
and in a manner consistent with past practice) under any of the InfoCast
Employee Plans (as hereinafter defined) or to any employee, independent
contractor or consultant, entered into any new InfoCast Employee Plans or any
new consulting agreement, granted or established any awards under any of the
InfoCast Employee Plans or agreement, in any such case providing for payments of
more than $25,000 or adopted or otherwise amended any of the foregoing.

Section 4.9 Taxes and Tax Returns. Except as set forth on SCHEDULE 4.9,
InfoCast has (i) duly filed with the appropriate taxing authorities for any
Governmental Authority all Tax Returns required to be filed by or with respect
to InfoCast, or are properly on extension and all such duly filed Tax Returns
are true, correct and complete in all respects, and (ii) paid in full or made
adequate provisions for on its balance sheet (in accordance with U.S. GAAP) all
Taxes shown to be due on such Tax Returns. There are no liens for Taxes upon the
assets of InfoCast except for statutory liens for current Taxes not yet due and
payable or which may thereafter be paid without penalty or are being contested
in good faith. InfoCast has not received any notice of audit, is not undergoing
any audit of its Tax Returns, and has not received any notice of deficiency or
assessment from any taxing authority with respect to liability for Taxes of
InfoCast which has not been fully paid or finally settled. There have been no
waivers of statutes of limitations by InfoCast with respect to any Tax Returns
which relate to InfoCast. InfoCast has not filed a request with the Internal
Revenue Service for changes in accounting methods within the last two years
which change would effect the accounting for tax purposes, directly or
indirectly, of InfoCast.

Section 4.10 Employee Benefit Plans. SCHEDULE 4.10 hereto comprises a
listing of each bonus, stock option, stock purchase, benefit, profit sharing,
savings, retirement, liability, insurance, incentive, deferred
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compensation, and other similar fringe or employee benefit plans, programs or
arrangements for the benefit of or relating to, any employee of, or independent
contractor or consultant to, and all other compensation practices, policies,
terms or conditions, whether written or unwritten (the "InfoCast Employee
Plans") which InfoCast presently maintains, to which InfoCast presently
contributes or under which InfoCast has any liability and which relate to
employees or independent contractors of InfoCast. The InfoCast Employee Plans
administered by InfoCast have been administered in all respects in accordance
with all requirements of applicable law and terms of each such plan. Each
InfoCast Employee Plan that is required or intended to be qualified under
applicable law or registered or approved by a Governmental Authority, has been
so qualified, registered or approved by the appropriate Governmental Authority
and nothing has occurred since the date of the last qualification, registration
or approval to adversely affect, or cause, the appropriate Governmental
Authority to revoke such qualification, registration or approval. All
contributions (including premiums) required by law or contract to have been made
or approved by InfoCast under or with respect to InfoCast Employee Plans have
been paid or accrued by InfoCast. Without limiting the foregoing, there are no
unfunded liabilities under any InfoCast Employee Plan. InfoCast has not received
notice of any investigations, litigation or other enforcement actions against
InfoCast with respect to any of InfoCast Employee Plans. There are no pending
actions, suits or claims by former or present employees of InfoCast (or their
beneficiaries) with respect to InfoCast Employee Plans or the assets or
fiduciaries thereof (other than routine claims for benefits).

Section 4.11 Title to Property. InfoCast has good and marketable title,
or valid leasehold rights (in the case of leased property), to all real property
and all personal property purported to be owned or leased by it or used in the
operation of its business, free and clear of all encumbrances, excluding (i)
liens for taxes, fees, levies, imposts, duties or governmental charges of any
kind which are not yet delinquent or are being contested in good faith by
appropriate proceedings which suspend the collection thereof; (ii) liens for
mechanics, materialmen, laborers, employees, suppliers or others which are not
yet delinquent or are being contested in good faith by appropriate proceedings;
(iii) liens created in the ordinary course of business in connection with the
leasing or financing of office, computer and related equipment and supplies;
(iv) easements and similar encumbrances ordinarily created for fuller
utilization and enjoyment of property; and (v) liens or defects in title or
leasehold rights that either individually or in the aggregate do not and will
not have a Material Adverse Effect. All of such owned or leased property with a
value in excess of $5,000 is listed on SCHEDULE 4.11 hereto.

Section 4.12 Trademarks, Patents and Copyrights.

(a) For purposes of this Agreement, the term "InfoCast Rights" shall mean
all worldwide industrial and intellectual property rights, including, without
limitation, each patent, patent rights, license, patent application, trade name,
trademark, trademark registration, copyright, copyright registration, copyright
application, service mark, brand mark, brand name and trade secrets relating to
or arising from any proprietary process, formula, source or object code, owned
or possessed by InfoCast. InfoCast owns or has the right to use, sell or license
all InfoCast Rights and such InfoCast Rights are sufficient for the conduct of
InfoCast's businesses as being conducted as of the date hereof.

(b) The execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated hereby will not constitute a
breach of any instrument or agreement governing any of the InfoCast Rights, will
not cause the forfeiture or termination or give rise to a right of forfeiture or
termination of any of the InfoCast Rights or impair the right of InfoCast to
use, sell or license any of the InfoCast Rights or any portion thereof;

(c) Neither the manufacture, marketing, license, sale or intended use of
any product or service currently licensed or sold by InfoCast or currently under
development by InfoCast violates any license or agreement between InfoCast and
any third party relating to such product or service or infringes any
intellectual property right of any other party, and there is no pending or, to
the knowledge of InfoCast, threatened claim or litigation contesting the
validity, ownership or right to use, sell, license or dispose of any of the
InfoCast Rights nor, to the knowledge of InfoCast, is there any basis for any
such claim, nor has InfoCast received any notice asserting that any of the
InfoCast Rights or the proposed use, sale, license or disposition thereof
conflicts or

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will conflict with the rights of any other party, nor, to the knowledge of
InfoCast, is there any basis for any such assertion; and

(d) No current or prior officers, employees or consultants of InfoCast
claim an ownership interest in any of the InfoCast Rights as a result of having
been involved in the development of such property while employed by or
consulting to InfoCast or otherwise.

Section 4.13 Legal Proceedings, Claims, Investigations, etc. There is no
legal, administrative, arbitration or other action or proceeding or governmental
investigation pending or, to the knowledge of InfoCast, threatened, against
InfoCast, any director, officer or employee thereof relating to InfoCast's
business. InfoCast has not been informed of any violation of or default under,
any laws, ordinances, regulations, judgments, injunctions, orders or decrees
(including without limitation, any immigration laws or regulations) of any
Governmental Authority or arbitrator applicable to the business of InfoCast.
Except as set forth in the SEC Reports, InfoCast is not currently subject to any
judgment, order, injunction or decree of any court, arbitral authority,
administrative agency or other Governmental Authority.

Section 4.14 Insurance. SCHEDULE 4.14 hereto sets forth a list and brief
description of all existing insurance policies maintained by InfoCast pertaining
to its business properties, personnel or assets. InfoCast is not in default with
respect to any material provision contained in any insurance policy, and has not
failed to give any notice or present any claim under any insurance policy in due
and timely fashion. All payments with respect to such policies are current and
InfoCast has not received any notice threatening a suspension, revocation,
modification or cancellation of any such policy.

Section 4.15 Material Contracts.

(a) Except as set forth on SCHEDULE 4.15 hereto, InfoCast is not a party to
and is not bound by any contract or has any commitment, whether written or oral
which has a term in excess of one year and will result in payments in excess of
$50,000, other than (i) contracts or commitments entered into in the ordinary
course of business with vendors and customers and (ii) contracts or commitments
cancelable upon not more than 30 days' notice. Each of the contracts and
commitments set forth on SCHEDULE 4.15 hereto and each of the other contracts
and commitments to which InfoCast is a party, is valid and existing, in full
force and effect and enforceable in accordance with its terms (subject to
equitable principles and limitations on indemnity) and to the knowledge of
InfoCast, there is no material default or claim of default against InfoCast or
any notice of termination with respect thereto. InfoCast has complied in all
material respects with all requirements of, and performed all of its obligations
under, such contracts and commitments. In addition, no other party to any such
contract or commitment is, to the knowledge of InfoCast, in default under or in
breach of any material term or provision thereof, and to the knowledge of
InfoCast, there exists no condition or event which, after notice or lapse of
time or both, would constitute a material default by any party to any such
contract or commitment. Copies of all the written documents and a synopsis of
all oral contracts and commitments described on SCHEDULE 4.15 hereto have
heretofore been made available to i360 and are true and complete and include all
amendments and supplements thereto and modifications thereof to and including
the date hereof.

(b) InfoCast is not a party to any oral or written (i) agreement with any
consultant, executive officer or other key employee the benefits of which are
contingent, or the terms of which are materially altered, upon the occurrence of
the transactions contemplated by this Agreement, or (ii) agreement or plan,
including any stock option plan and the like, any of the benefits of which will
be increased, or the vesting of the benefits of which will be accelerated, by
the occurrence of the transactions contemplated by this Agreement.

Section 4.16 Certain Transactions. No officer, director or any employee
of InfoCast, or any member of any such person's immediate family is presently a
party to any contract, arrangement or understanding with InfoCast (i) providing
for the furnishing of services by, (ii) providing for the rental of real or
personal property from, or (iii) otherwise requiring payments to (other than for
services as officers, directors or employees of InfoCast), any such person or
any corporation, partnership, trust or other entity in which any such person has
a substantial interest as a stockholder, officer, director, trustee or partner.

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Section 4.17 Broker. Except as disclosed on SCHEDULE 4.17, no broker,
finder or investment banker is entitled to any brokerage or finder's fee or
other commission in connection with the transactions contemplated hereby based
on the arrangements made by or on behalf of InfoCast.

Section 4.18 Environmental Matters.

(a) InfoCast is not the subject of, or to the knowledge of InfoCast, being
threatened to be the subject of (i) any enforcement proceeding, or (ii) any
investigation, brought in either case under any federal, state or local
environmental law, rule, regulation, or ordinance at any time in effect or (iii)
any third party claim relating to environmental conditions on or off the
properties of InfoCast. InfoCast has not been notified that it must obtain any
permits and licenses or file documents for the operation of its business under
federal, state and local laws relating to pollution protection of the
environment. InfoCast has not been notified of any conditions on or off the
properties of InfoCast which will give rise to any liabilities, known or
unknown, under any federal, state or local environmental law, rule, regulation
or ordinance, or as the result of any claim of any third party. For the purposes
of this Section 4.18, an investigation shall include, but is not limited to, any
written notice received by InfoCast which relates to the onsite or offsite
disposal, release, discharge or spill of any waste, waste water, pollutant or
contaminants.

(b) There are no toxic wastes or other toxic or hazardous substances or
materials, pollutants or contaminants which InfoCast (or, to the knowledge of
InfoCast, any previous occupant of InfoCast's facilities) has used, stored or
otherwise held in or on any of the facilities of InfoCast, which, are present at
or have migrated from the facilities, whether contained in ambient air, surface
water, groundwater, land surface strata. The facilities have been maintained by
InfoCast in compliance with all environmental protection, occupational, health
and safety or similar laws, ordinances, restrictions, licenses, and regulations.
InfoCast has not disposed of or arranged (by contract, agreement or otherwise)
for the disposal of any materials that was generated or used by InfoCast at any
off-site location that has been or is listed or proposed for inclusion on any
list promulgated by any Governmental Authority for the purpose of identifying
sites which pose a danger to health and safety. To the best knowledge of
InfoCast after due inquiry, there have been no environmental studies, reports
and analyses made or prepared in the last five (5) years relating to the
facilities of InfoCast. InfoCast has not installed any underground storage tanks
in any of its facilities and none of such facilities contain any underground
storage tanks.

Section 4.19 Illegal Payments. InfoCast has not, directly or indirectly,
paid or delivered any fee, commission or other sum of money or item of property,
however characterized, to any finder, agent, government official or other party,
in the United States or any other country, which is in any manner related to the
business or operations of InfoCast, which InfoCast knows or has reason to
believe to have been illegal under any federal, state or local laws or the laws
of any other country having jurisdiction.

Section 4.20 Compliance with Law. InfoCast has complied in all respects
with all laws, rules, regulations, arbitral determinations, orders, writs,
decrees and injunctions which are applicable to or binding upon InfoCast or its
properties, the non-compliance with which could reasonably be expected to
constitute a Material Adverse Effect.

Section 4.21 Receivables. Each account receivable reflected on the
balance sheet of InfoCast at December 31, 2000, represents a valid obligation
owed to InfoCast. All such accounts receivable arising between the date hereof
and the Effective Time are or will be valid and subsisting, represent or will
represent sales actually made, arose or will arise in the ordinary and usual
course of the business of InfoCast and to the extent not collected prior to the
Effective Time, to the knowledge of InfoCast, will be collected according to
their terms subject to allowances for doubtful accounts set forth on the balance
sheet. No payment reflected on such books and records as having been made on any
such account receivable was made by any director, officer, employee or agent of
InfoCast unless such person is shown on said books and records as the account
debtor. To the knowledge of InfoCast, there are no defenses, claims of
disabilities, counterclaims, offsets, refusals to pay or other rights of set-off
against any accounts receivable and there is no threatened, intended or proposed
defense, claim or disability, counterclaim, offset, refusal to pay or other
right of set-off with respect thereto.

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Section 4.22 Labor. InfoCast is not a party to any labor contract.
InfoCast has not received any notice from any labor union or group of employees
that such union or group represents or believes or claims it represents or
intends to represent any of the employees of InfoCast; to the knowledge of
InfoCast, no strike or work interruption by any of its employees is planned,
under consideration, threatened or imminent; there are no repeat, serious or
willful safety issues pending under OSHA related to any of the InfoCast
employees; and neither InfoCast nor any officer or director thereof has made any
loan or given anything of value, directly or indirectly, to any officer,
official, agent or representative of any labor union or group of employees. To
the best knowledge of InfoCast after due inquiry, at no time during the past
three (3) years has InfoCast experienced any threats of strikes, work stoppages
or demands for collective bargaining by any union or labor organization or any
other group or other organization of employees, any grievances, disputes or
controversies with any union or any other group or other organization of
employees, or any pending or threatened court of arbitration proceedings
involving an employment grievance, dispute or controversy. InfoCast is not
delinquent in payments to any of its employees for any wages, salaries,
commissions, bonuses or other direct compensation for any services performed by
them to the date hereof or amounts required to be reimbursed to such employees.

Section 4.23 Books of Account; Records. The general ledgers, books of
account and other records of InfoCast are complete and correct, have been
maintained in accordance with good business practices and the matters contained
therein are appropriately and accurately reflected in the InfoCast Financial
Statements.

Section 4.24 Reorganization and Regulatory Matters. InfoCast has not
taken any action nor does it have any knowledge of any fact or circumstance that
is reasonably likely to (i) prevent the Merger from qualifying as a
reorganization within the meaning of Section 368(a) of the Code, or (ii)
materially impede or delay receipt of any consents of any Governmental Authority
or result in the imposition of a condition or restriction of the type that would
result in a Material Adverse Effect on the economic or business benefits of the
transaction contemplated by this Agreement.

ARTICLE V

COVENANTS OF i360

Section 5.1 Covenants of i360 Regarding Conduct of Business Operations
Pending the Closing. i360 covenants and agrees that between the date of this
Agreement and the Closing Date, i360 will carry on its business in the ordinary
course and consistent with past practice, will use its best efforts to (i)
preserve its business organization intact, (ii) retain the services of its
present employees, and (iii) preserve the good will of its suppliers and
customers, and will not, except in the ordinary course of business, purchase,
sell, lease or dispose of any property or assets or incur any liability or enter
into any other extraordinary transaction. By way of amplification and not
limitation, i360 shall not, between the date of this Agreement and the Closing
Date, directly or indirectly, do any of the following without the prior written
consent of InfoCast:

(a) (i) issue, sell, pledge, dispose of, encumber, authorize, or
propose the issuance, sale, pledge, disposition, encumbrance or
authorization of any shares of capital stock of any class, or any options,
warrants, convertible securities or other rights of any kind to acquire any
shares of capital stock, or any other ownership interest, of i360; (ii)
amend or propose to amend its certificate of incorporation or bylaws; (iii)
split, combine or reclassify any of its outstanding shares, or declare, set
aside or pay any dividend or other distribution payable in cash, stock,
property or otherwise with respect thereto; or (iv) redeem, purchase or
otherwise acquire any shares of its capital stock;

(b) (i) make any acquisition (by merger, consolidation, or acquisition
of stock or assets) of any corporation, partnership or other business
organization or division thereof; (ii) sell, pledge, dispose of, or
encumber or authorize or propose the sale, pledge, disposition or
encumbrance of any of its assets; (iii) incur any indebtedness for borrowed
money, assume, guarantee, endorse or otherwise become responsible for the
obligations of any other individual, partnership, firm or corporation, or
make any loans or advances to any individual, partnership, firm, or
corporation, or enter into any contract or agreement to do so; (iv)
authorize any single capital expenditure or series of related capital
expenditures each of which

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is in excess of $25,000; or (v) release or assign any indebtedness owed to
it or any claims held by it, except in the ordinary course of business and
consistent with past practice;

(c) take any action other than in the ordinary course of business and
in a manner consistent with past practice (none of which actions shall be
unreasonable or unusual) with respect to the grant of any severance or
termination pay (otherwise than pursuant to its policies in effect on the
date hereof) or with respect to any increase of benefits payable under its
severance or termination pay policies in effect on the date hereof;

(d) make any payments (except in the ordinary course of business and
in amounts and in a manner consistent with past practice) under any of the
i360 Employee Plans to any employee, independent contractor or consultant,
enter into any new i360 employee plan or any new consulting agreement,
grant or establish any awards under such i360 employee plans or agreement,
in any such case providing for payments of more than $5,000, or adopt or
otherwise amend any of the foregoing;

(e) take any action except in the ordinary course of business and in a
manner consistent with past practice (none of which actions shall be
unreasonable or unusual) with respect to accounting policies or procedures,
other than such actions deemed necessary to comply with U.S. GAAP
(including without limitation its procedures with respect to the payment of
accounts payable);

(f) enter into or terminate any material contract or agreement or make
any material change in any of its material contracts or agreements, other
than (i) in the ordinary course of business and (ii) agreements, if any,
relating to the transactions contemplated hereby; or

(g) take, or agree in writing or otherwise to take, any of the
foregoing actions or any action which would make any of its representations
or warranties contained in this Agreement untrue or incorrect in any
material respect as of the date when made or as of a future date.

Section 5.2 No Other Negotiations. i360 agrees that, between the date
hereof and the earlier to occur of (i) the Closing Date or (ii) the termination
of this Agreement pursuant to the provisions of Article XII hereof (the
"Termination Date"), i360 will not, nor will it permit any of its affiliates
(including any officers, directors, employees, financial advisors, brokers,
stockholders or any other person acting on its behalf) to, (i) enter into any
agreement with a third party with respect to the acquisition, directly or
indirectly, of shares or other securities of i360 or a material part of its
assets or any merger, business combination, consolidation or reorganization,
(ii) enter into negotiations with a third party regarding such an agreement, or
(iii) provide a third party with general access to their books, records or
employees for the purpose of enabling such third party to conduct a purchase
investigation of the legal, financial or business condition of i360.

ARTICLE VI

COVENANTS OF INFOCAST

Section 6.1 Conversion of i360 Stock Options.

(a) All outstanding i360 Stock Options granted under the i360 Option Plan
(the "i360 Option Plan"), whether vested or unvested, shall be deemed to
constitute an option to acquire, on the same terms and conditions as were
applicable under such i360 Stock Option, including vesting, the same InfoCast
Common Stock portion of the Merger Consideration the holder of such i360 Stock
Option would have been entitled to receive pursuant to the Merger had such
holder exercised such i360 Stock Option in full immediately prior to the
Effective Time, at a price per share of InfoCast Common Stock equal to (a) the
aggregate exercise price for the shares of i360 Common Stock pursuant to such
i360 Stock Option divided by (b) the aggregate number of shares of InfoCast
Common Stock that may be purchased pursuant to such i360 Stock Option (each, as
so adjusted, an "Adjusted Option");

(b) Each holder of an Adjusted Option shall be required upon exercise of
such option to represent and warrant as a condition of receiving shares of
InfoCast Common Stock that he or she is acquiring such shares solely for his or
her own account for investment purposes and not with a view to distribution or
resale; he or

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she understands that upon issuance hereunder none of the InfoCast Common Stock
will be registered under the Securities Act of 1933 (the "Securities Act") and
such shares may not be transferred, assigned or negotiated except pursuant to an
applicable exemption under the Securities Act; that stop transfer instructions
will be issued against all such shares and that the certificates evidencing the
InfoCast Common Stock shall bear the following legend:

"THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
(THE "ACT") OR ANY STATE SECURITIES LAWS. THESE SECURITIES MAY NOT BE SOLD
EXCEPT AS PERMITTED UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS,
PURSUANT TO REGISTRATION OR AN EXEMPTION THEREFROM."

(c) As soon as practicable after the Effective Time, InfoCast shall deliver
to the holders of i360 Stock Options appropriate notices setting forth such
holders' rights pursuant to the i360 Option Plan and the agreements evidencing
the grants of such i360 Stock Options and that such i360 Stock Options and
agreements shall be assumed by InfoCast and shall continue in effect on the same
terms and conditions (subject to the adjustments required by this Section 6.1
after giving effect to the Merger). InfoCast shall comply with the terms of the
i360 Option Plan. A holder of an Adjusted Option may exercise such Adjusted
Option in whole or in part in accordance with its terms by delivering a properly
executed notice of exercise to InfoCast, together with the consideration
therefor and the federal withholding tax information, if any, required in
accordance with the i360 Option Plan;

(d) At or prior to the Effective Time, InfoCast shall take all corporate
action necessary to reserve for issuance a sufficient number of shares of
InfoCast Common Stock for delivery upon exercise of the i360 Stock Options.

Section 6.2 i360 Employee Benefit Plans. InfoCast agrees to honor in
accordance with their terms the i360 Employee Benefit Plans, including, without
limitation, any rights or benefits arising thereunder as a result of the
transactions contemplated by this Agreement (either alone or in combination with
any other event). After the Merger, it is the intention of the parties hereto
that InfoCast will continue to maintain the i360 Employee Benefit Plans, in each
case in accordance with their terms as in effect at the Effective Time, with
only such amendments as are required by applicable law or permitted by the terms
thereof as in effect at the Effective Time, and which do not adversely affect
the rights of participants (or their beneficiaries) thereunder. InfoCast shall
take, and shall cause the Surviving Corporation to take, the following actions:
(i) waive any limitations regarding pre-existing conditions and eligibility
waiting periods under any welfare or other employee benefit plan maintained by
them for the benefit of employees of i360 immediately prior to the Effective
Time (the "i360 Employees") or in which i360 Employees participate after the
Effective Time, (ii) provide each i360 Employee with credit for any co-payments
and deductibles paid prior to the Effective Time for the calendar year in which
the Effective Time occurs, in satisfying any applicable deductible or out-
of-pocket requirements under any welfare plans that such employees are eligible
to participate in after the Effective Time, and (iii) for all purposes (other
than for purposes of benefit accruals under any defined benefit pension plan)
under all compensation and benefit plans and policies applicable to i360
Employees, treat all service by i360 Employees with i360 before the Effective
Time as service with InfoCast.

Section 6.3 Certain Employee Matters. Following the Effective Time,
InfoCast, as the Surviving Corporation in the Merger, will honor all obligations
under employment agreements of i360 in existence prior to the Effective Time in
accordance with the terms thereof. As of the Effective Time, InfoCast shall
guarantee the performance of the employment contracts and i360 Employee Benefit
Plans in accordance with their respective terms and the terms of this Agreement.

Section 6.4 Indemnification, Exculpation and Insurance.

(a) Subject only to the limitations of the Nevada Act, InfoCast agrees that
all rights to indemnification and exculpation from liabilities for acts or
omissions occurring at or prior to the Effective Time now existing in favor of
the current directors of i360 as provided in their respective certificates of
incorporation or by-laws (or comparable organizational documents) and any
indemnification agreements of i360, the existence of which does not constitute a
breach of this Agreement, shall be assumed by InfoCast, as the Surviving
Corporation in

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the Merger, without further action, as of the Effective Time and shall survive
the Merger and shall continue in full force and effect in accordance with their
terms. The Surviving Corporation shall upon the request of any current
(immediately prior to the Effective Time) director of i360, enter into a
contract obligating the Surviving Corporation to indemnify and exculpate such
individual for liabilities as described in this Section 6.4. In addition, from
and after the Effective Time, directors and officers of i360 who become
directors or officers of InfoCast will be entitled to the same indemnity rights
and protections as are afforded to other directors and officers of InfoCast.

(b) In the event that InfoCast or any of its successors or assigns (i)
consolidates with or merges into any other person and is not the continuing or
surviving corporation or entity of such consolidation or merger or (ii)
transfers or conveys all or substantially all of its properties and assets to
any person, then, and in each such case, InfoCast shall require any such
agreement or other contract that the successor, assign or transferee assume the
obligations set forth in this Section 6.4.

(c) The provisions of this Section 6.4 are intended to be for the benefit
of, and will be enforceable by, each indemnified party, his or her heirs and his
or her representatives and (ii) are in addition to, and not in substitution for,
any other rights to indemnification or contribution that any such person may
have by contract or otherwise.

Section 6.5 Listing on a National Securities Exchange. After the Merger,
the Board of Directors shall authorize the proper officers of InfoCast to take
all reasonable steps necessary to cause the InfoCast Common Stock and the Merger
Consideration to be listed or admitted for trading on Nasdaq or a national
securities exchange other than the over-the-counter bulletin board.

Section 6.6 2000 Operational Budget of i360. Following the Merger,
InfoCast agrees, subject to i360 substantially achieving the identified revenue
targets, to fund as necessary the operational budget of i360 for the balance of
the year 2000, which is set forth on Exhibit G.

ARTICLE VII

ADDITIONAL COVENANTS

Section 7.1 Covenants of All Parties. Each of i360 and InfoCast covenants
and agrees:

Section 7.2 Best Efforts. To proceed diligently and use its best efforts
to take or cause to be taken all actions and to do or cause to be done all
things necessary, proper and advisable to consummate the transactions
contemplated by this Agreement.

Section 7.3 Compliance. To comply in all material respects with all
applicable rules and regulations of any Governmental Authority in connection
with the execution, delivery and performance of this Agreement and the
transactions contemplated hereby; to use all reasonable efforts to obtain in a
timely manner all necessary waivers, consents and approvals and to take, or
cause to be taken, all other actions and to do, or cause to be done, all other
things necessary, proper or advisable to consummate and make effective as
promptly as practicable the transactions contemplated by this Agreement.

Section 7.4 Notice. To give prompt notice to the other party of (i) the
occurrence, or failure to occur, of any event whose occurrence or failure to
occur, would be likely to cause any representation or warranty contained in this
Agreement to be untrue or incorrect in any material respect at any time from the
date hereof to the Closing Date and (ii) any material failure on its part, or on
the part of any of its officers, directors, employees or agents, to comply with
or satisfy any covenant, condition or agreement to be complied with or satisfied
by it hereunder; provided, however, that the delivery of any such notice shall
not limit or otherwise affect the remedies available hereunder to the party
receiving such notice.

Section 7.5 Access. To cause its affiliates, officers, directors,
employees, auditors and agents to afford the officers, employees and agents of
the other party hereto complete access at all reasonable times and upon
reasonable notice to its properties, offices and other facilities and to all
books and records, and shall furnish such other party with all financial,
operating and other data and information as the other party through its

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officers, employees or agents, may reasonably request, provided that the party
providing such access and furnishing such data and information to the other
party incurs no cost in doing so.

Section 7.6 Confidentiality. To hold in strict confidence all data and
information obtained from the other party hereto or any subsidiary, division,
associate, representative, agent or affiliate of any such party (unless such
information is or becomes publicly available without the fault of any
representative of such party, or public disclosure of such information is
required by law in the opinion of counsel to such party) and shall insure that
such representatives do not disclose information to others without the prior
written consent of the other party hereto, and in the event of the termination
of this Agreement, to cause its representatives to return promptly every
document furnished by the other party hereto or any subsidiary, division,
associate, representative, agent or affiliate of any such party in connection
with the transactions contemplated hereby and any copies thereof which may have
been made, other than documents which are publicly available.

Section 7.7 Announcements. That all public announcements, statements and
press releases concerning the transactions contemplated by this Agreement shall
be mutually agreed to by i360 and InfoCast before the issuance or the making
thereof and, subject to the advice of counsel, no party shall issue any such
press releases or make any such public statement prior to such mutual agreement,
except as may be required by law. The parties acknowledge and agree that
InfoCast is required to file a Current Report on Form 8-K pursuant to the
Exchange Act in respect of the transactions contemplated hereby.

Section 7.8 Covenants of Certain i360 Shareholders. Each of the i360
Shareholders set forth in the agreement on Exhibit B shall covenant and agree
that they will vote, or cause to be voted, all of the shares of i360 Common
Stock then owned by them in favor of the approval of the Merger and the adoption
of this Agreement.

ARTICLE VIII

CONDITIONS PRECEDENT TO OBLIGATIONS OF i360

The obligations of i360 under this Agreement are subject to the
satisfaction, on or prior to the Closing Date, unless waived in writing, of each
of the following conditions:

Section 8.1 Representations and Warranties True. The representations and
warranties of InfoCast contained in this Agreement shall be true and correct in
all material respects as of the date when made and at and as of the Closing
Date, except as and to the extent that the facts and conditions upon which such
representations and warranties are based are expressly required or permitted to
be changed by the terms hereof, with the same force and effect as if made on and
as of the Closing Date, and i360 shall have received a certificate to that
effect and as to the matters set forth in Section 8.2 hereof, dated the Closing
Date, from the President or Chief Executive Officer of InfoCast.

Section 8.2 Performance of Covenants. InfoCast shall have performed or
complied in all material respects with all agreements, conditions and covenants
required by this Agreement to be performed or complied with by it on or before
the Closing Date.

Section 8.3 Shareholder Approval. The Merger and this Agreement and all
actions contemplated herein requiring shareholder approval shall have been
authorized and approved by the requisite vote of the shareholders of i360 and
InfoCast.

Section 8.4 No Proceedings. No preliminary or permanent injunction or
other order (including a temporary restraining order) of any Governmental
Authority which prohibits the consummation of the transactions which are the
subject of this Agreement or prohibits the Merger shall have been issued or
entered and remain in effect.

Section 8.5 Consents and Approvals. All filings and registrations with,
and notifications to, all Governmental Authorities required for consummation of
the transactions contemplated by this Agreement shall have been made, and all
consents, approvals and authorizations of all Governmental Authorities and

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parties to material contracts, licenses, agreements or instruments required for
consummation of the transactions contemplated by this Agreement shall have been
received and shall be in full force and effect.

Section 8.6 Opinion of InfoCast Counsel. i360 shall have received the
opinion of Olshan Grundman Frome Rosenzweig & Wolosky LLP, counsel to InfoCast,
dated the Closing Date, in form reasonably satisfactory to i360, substantially
to the effect that: (i) InfoCast is a corporation duly organized, validly
existing and in good standing under the laws of the State of Nevada; (ii)
InfoCast has the corporate power to enter into this Agreement and to consummate
the transactions contemplated hereby; (iii) the execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby have been
duly authorized by requisite corporate action taken on the part of InfoCast;
(iv) this Agreement and the Registration Rights Agreement has been executed and
delivered by InfoCast and (assuming that it is a valid and binding obligation of
the other parties thereto) is a valid and binding obligation of InfoCast
enforceable against InfoCast in accordance with its terms, except (a) as
enforceability may be limited by any bankruptcy, insolvency and other laws
affecting the enforcement of creditors' rights generally, and as such
enforceability is subject to general principles of equity (regardless of whether
such enforceability is considered in a proceeding in equity or at law); (v) the
shares of InfoCast Common Stock that represent the Merger Consideration and the
shares of InfoCast Common Stock that underlie the options converted pursuant to
Sections 6.1 and 8.9 of this Agreement are duly authorized, validly issued,
fully paid and nonassessable, (vi) none of the execution, delivery or
performance of this Agreement by InfoCast and the consummation by InfoCast of
the transactions herein contemplated, conflict with or result in a breach of, or
default under, InfoCast's Articles of Incorporation or Bylaws or, to the best of
such counsel's knowledge, any indenture, mortgage, deed of trust, voting trust
agreement, shareholders' agreement, note agreement or other agreement or other
material instrument to which InfoCast is a party or by which InfoCast is bound
or to which any of the property of InfoCast is subject or, to the best of such
counsel's knowledge, contravene any law, rule or regulation applicable to
InfoCast (except as otherwise disclosed in this Agreement), and (vii) to the
best of such counsel's knowledge, there is no action, suit or proceeding
pending, or threatened, against or affecting InfoCast before any Governmental
Authority or arbitrator (or any basis thereof known to such counsel) in which
there is a reasonable possibility of an adverse decision which may have a
Material Adverse Effect on InfoCast, which could adversely affect the present or
prospective ability of InfoCast to perform its obligations under this Agreement
or which in any manner draws into question the validity or enforceability of
this Agreement.

Section 8.7 Material Changes. Since the date hereof, there shall not have
been a Material Adverse Effect in the business, operations, financial condition,
assets, liabilities, prospects or regulatory status of InfoCast.

Section 8.8 Registration Rights Agreement. InfoCast shall have entered
into a registration rights agreement substantially in the form of Exhibit C (the
"Registration Rights Agreement").

Section 8.9 Employee Stock Options After Merger. The Board of Directors
of InfoCast shall have approved the issuance of options for a total of 469,197
shares of InfoCast Common Stock at an exercise price equal to four dollars
($4.00) per share to be awarded in an amount and to individuals who are hired
after the Effective Date as recommended by the operational management of the
business of i360 following the Effective Time.

Section 8.10 Escrow Agreement. InfoCast shall have entered into the
Escrow Agreement substantially in the form of Exhibit A.

Section 8.11 Shareholder Designee Agreement. InfoCast shall have entered
into the Shareholder Designee Agreement substantially in the form of Exhibit F
(the "Shareholder Designee Agreement").

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ARTICLE IX

CONDITIONS PRECEDENT TO OBLIGATIONS OF INFOCAST

The obligations of InfoCast under this Agreement are subject to the
satisfaction, on or prior to the Closing Date, unless waived in writing, of each
of the following conditions:

Section 9.1 Representation and Warranties True. The representations and
warranties of i360 contained in this Agreement shall be true and correct in all
material respects as of the date when made and at and as of the Closing Date,
except as and to the extent that the facts and conditions upon which such
representations and warranties are based are expressly required or permitted to
be changed by the terms hereof with the same force and effect as if made on and
as of the Closing Date, and InfoCast shall have received a certificate to that
effect and as to the matters set forth in Section 9.2 hereof, dated the Closing
Date, from the President or Chief Executive Officer of i360.

Section 9.2 Performance of Covenants. i360 shall have performed or
complied in all material respects with all agreements, conditions and covenants
required by this Agreement to be performed or complied with by them on or before
the Closing Date.

Section 9.3 Shareholder Approval. The Merger and this Agreement and all
actions contemplated herein requiring shareholder approval shall have been
authorized and approved by the requisite vote of the shareholders of i360 and
InfoCast.

Section 9.4 No Proceedings. No preliminary or permanent injunction or
other order (including a temporary restraining order) of Governmental Authority
which prohibits the consummation of the transactions which are the subject of
this Agreement or prohibits the Merger or operation of i360's business shall
have been issued or entered and remain in effect.

Section 9.5 Consents and Approvals. All filings and registrations with,
and notifications to, all Governmental Authorities required for consummation of
the transactions contemplated by this Agreement shall have been made, and all
consents, approvals and authorizations of all Governmental Authorities and
parties to material contracts, licenses, agreements or instruments required for
consummation of the transactions contemplated by this Agreement shall have been
received and shall be in full force and effect.

Section 9.6 Opinion of i360's Counsel. InfoCast shall have received the
opinion of Fennemore Craig P.C., counsel to i360, dated the Closing Date, in
form reasonably satisfactory to InfoCast, substantially to the effect that: (i)
i360 is a corporation duly organized, validly existing and in good standing
under the laws of the State of Utah; (ii) i360 has the corporate power to enter
into this Agreement and to consummate the transactions contemplated hereby;
(iii) the execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly authorized by requisite
corporate action taken on the part of i360; (iv) this Agreement and the
Registration Rights Agreement has been executed and delivered by i360 and
(assuming that it is a valid and binding obligation of the other parties
thereto) is a valid and binding obligation of i360 enforceable against i360 in
accordance with its terms, except (a) as enforceability may be limited by any
bankruptcy, insolvency and other laws affecting the enforcement of creditors'
rights generally, and as such enforceability is subject to general principles of
equity (regardless of whether such enforceability is considered in a proceeding
in equity or at law); (v) the i360 Common Stock issued after January 1, 2000 is
duly authorized, validly issued, fully paid and nonassessable, (vi) none of the
execution, delivery or performance of this Agreement by i360 and the
consummation by i360 of the transactions herein contemplated, conflict with or
result in a breach of, or default under, i360's Certificate of Incorporation or
Bylaws or, to the best of such counsel's knowledge, any indenture, mortgage,
deed of trust, voting trust agreement, shareholders' agreement, note agreement
or other agreement or other material instrument to which i360 is a party or by
which i360 is bound or to which any of the property of i360 is subject or, to
the best of such counsel's knowledge, contravene any law, rule or regulation
applicable to i360 (except as otherwise disclosed in this Agreement), and (vii)
to the best of such counsel's knowledge, there is no action, suit or proceeding
pending, or threatened, against or affecting i360 before any Governmental
Authority or arbitrator (or any basis thereof known to such counsel) in which
there is a reasonable possibility of an adverse decision which may have a
Material Adverse Effect on i360, which could adversely affect the present or
prospective ability of i360
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to perform its obligations under this Agreement or which in any manner draws
into question the validity or enforceability of this Agreement.

Section 9.7 Material Changes. Since the date hereof, there shall not have
been a Material Adverse Effect in the business, operations, financial condition,
assets, liabilities, prospects or regulatory status of i360.

Section 9.8 Financial Statements. i360 shall have delivered to InfoCast
the Financial Statements.

Section 9.9 Registration Rights Agreement. The shareholders of i360 shall
have entered into the Registration Rights Agreement substantially in the form of
Exhibit C.

Section 9.10 Dissenting Shares. The number of "dissenting shares" of i360
(as determined under Utah law) shall be less than 8% of the outstanding shares
of i360.

Section 9.11 Delivery of Questionnaires and Representation
Letters. InfoCast shall have received completed and executed Questionnaire and
Representation Letters in the form attached hereto as Exhibit D from each of the
shareholders of i360.

Section 9.12 Accredited Investors. i360 shall have no more than
thirty-five (35) shareholders who are not "accredited investors," as that term
is defined in Rule 501 of Regulation D, but who are either alone or with his or
her purchaser representative(s) has such knowledge and experience in financial
and business matters that he or she is capable of evaluating the merits and
risks of the prospective investment in InfoCast.

Section 9.13 Escrow Agreement. i360 and the shareholders of i360 set
forth therein shall have entered into the Escrow Agreement substantially in the
form of Exhibit A.

Section 9.14 Shareholder Designee Agreement. i360 shall have entered into
the Shareholder Designee Agreement substantially in the form of Exhibit F.

ARTICLE X

INDEMNIFICATION

Section 10.1 Survival of Representations, Warranties, Covenants and
Agreements. The representations, warranties, covenants and agreements of i360
and InfoCast contained in this Agreement shall survive the Closing Date for a
period of one (1) year following the Closing Date.

Section 10.2 Indemnification by i360. i360 shall defend, indemnify and
hold harmless InfoCast from and after the Closing Date against and with respect
to the following (together referred to as "InfoCast Losses"):

(a) any and all loss, injury, damage or deficiency resulting from any
misrepresentation or breach of warranty on the part of i360 under this
Agreement;

(b) any and all loss, injury, damage or deficiency resulting from any
non-fulfillment of any covenant or agreement on the part of i360 under this
Agreement; and

(c) any and all demands, claims, actions, suits or proceedings,
assessments, judgments, costs and legal and other expenses incident to any
of the foregoing.

Section 10.3 Indemnification by InfoCast. InfoCast hereby agrees to
defend, indemnify and hold harmless i360 at all times from and after the Closing
Date against and with respect to the following (together referred to as "i360
Losses"):

(a) any and all loss, injury, damage or deficiency resulting from any
misrepresentation or breach of warranty on the part of InfoCast under this
Agreement;

(b) any and all loss, injury, damage or deficiency resulting from any
non-fulfillment of any covenant or agreement on the part of InfoCast under
this Agreement; and

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(c) any and all demands, claims, actions, suits or proceedings,
assessments, judgments, costs and legal and other expenses incident to any
of the foregoing.

Section 10.4 Procedures for Indemnification. Promptly after receipt by an
indemnified party of notice of the commencement of any action involving the
subject matter of the provisions of Section 10.2 or 10.3, such indemnified party
shall, if a claim is to be made against an indemnifying party pursuant to the
provisions of Section 10.2 or Section 10.3, promptly notify such indemnifying
party of the commencement of such action; but the omission so to notify such
indemnifying party shall not relieve the indemnifying party from any liability
which it may have to the indemnified party. In case such action is brought
against an indemnified party and it notifies the indemnifying party of the
commencement of such action, the indemnifying party shall have the right to
participate in and, to the extent that it may wish, to assume the defense of
such action, with counsel satisfactory to such indemnified party; provided,
however, that if the defendants in such action include both the indemnified
party and the indemnifying party and the indemnified party shall have reasonably
concluded that there may be legal defenses available to it which are different
from or additional to those available to the indemnifying party, or if there is
a conflict of interest which would prevent counsel for the indemnifying party
from also representing the indemnified party, the indemnified party shall have
the right to select separate counsel to participate in the defense of such
action on behalf of such indemnified party, at the expense of the indemnifying
party. After notice from the indemnifying party to the indemnified party of the
indemnifying party's election so to assume the defense of such action, the
indemnifying party shall not be liable to the indemnified party pursuant to the
provisions of Sections 10.2 or 10.3 for any legal or other expense subsequently
incurred by such indemnified party in connection with the defense of such action
other than reasonable costs of investigation, unless (a) the indemnified party
shall have employed counsel in accordance with the proviso of the preceding
sentence, (b) the indemnifying party shall not have employed counsel
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after the notice of the commencement of the action, or (c) the
indemnifying party has authorized the employment of counsel for the indemnified
party at the expense of the indemnifying party. No indemnifying party shall,
except with the consent of each indemnified party, consent to entry of any
judgment or enter into any settlement which does not include as an unconditional
term of such settlement the release of all indemnified parties from all
liability in respect of such claim.

Section 10.5 Limitations on Indemnification by i360. Notwithstanding
Section 10.2 or any other provision of this Agreement or applicable law, the
aggregate liability of i360 shall at all times be limited as follows:

(a) i360 shall have no liability for any InfoCast Loss unless notice
of a claim for such InfoCast Loss, specifying in reasonable detail the
basis for such claim, is made upon the the Designee (as defined in Section
10.9) on or before the first anniversary of the Closing Date; and

(b) The maximum aggregate liability for InfoCast Losses shall in all
events be limited solely to the extent of the Escrow Shares.

Section 10.6 Mitigation of Losses. InfoCast Losses and i360 Losses shall
be referred to collectively in this Agreement sometimes as "Losses." Losses for
which any party is liable under this Article X shall be subject to appropriate
mitigation for any actual recovery from third parties (less attorneys' fees,
expenses and other costs of recovery), net savings realized from tax reductions,
and the actual collection of insurance proceeds (less attorneys' fees, expenses
and other costs of recovery), with respect to the event or condition giving rise
to such Losses.

Section 10.7 Exclusivity.

(a) Subject to Section 10.7(b), the remedies, subject to the limitations,
set forth in this Article X shall be the sole remedy for claims of the parties
to this Agreement for liability arising under this Agreement or any information
delivered pursuant to this Agreement.

(b) Notwithstanding the provisions of Section 10.7(a), the parties hereto
shall have the right to seek and obtain from a court of competent jurisdiction a
temporary restraining order, injunction, specific performance or other equitable
relief to enforce the provisions of this Agreement.
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Section 10.8 Cooperation in Defense. In case of any claim, arbitration or
legal proceeding, the defense of which is assumed by any or all of the
shareholders of i360 in accordance with this Article X, InfoCast, upon request
of such shareholders, shall provide reasonable cooperation (at the expense of
such shareholders in accordance with this Article X) in such defense, including
affording to such shareholders the right of access, during normal business
hours, upon reasonable notice and without disturbing the business of InfoCast,
to pertinent books and records for purposes of inspection and making copies.

Section 10.9 Escrow Account. The shares of InfoCast Common Stock held in
the Escrow Account shall be available to satisfy the indemnification claims of
InfoCast pursuant to this Article X, and InfoCast and the designee of i360
("Designee") shall, from time to time, direct the Escrow Agent to deliver to
InfoCast the number of shares of InfoCast Common Stock having a value equal to
the InfoCast Losses as to which InfoCast is entitled to be indemnified pursuant
to this Article X. For purposes of this Section 10.9, the value of a share of
InfoCast Common Stock shall be the average of the closing price for thirty
Trading Days prior to the date of payment of the claim of indemnification. On
the first anniversary of the Closing Date, InfoCast and the Designee shall
direct the Escrow Agent to deliver all of the shares of InfoCast Common Stock
then held in the Escrow Account to InfoCast and InfoCast shall thereupon
distribute such shares in accordance with Section 2.1(c) of this Agreement. For
purposes of this Section 10.9, "Trading Days" shall mean a day on which the
national securities exchange on which the InfoCast Common Stock are listed or
admitted to trading is open for the transaction of business.

ARTICLE XI

CLOSING DOCUMENTS

Section 11.1 Documents to be Delivered by the Parties. At the Closing,
each of i360 and InfoCast, shall execute and deliver the Articles of Merger
relating to the respective filings in each of Nevada and Utah substantially in
the form set forth as Exhibit E hereto.

Section 11.2 Documents to be Delivered by InfoCast. At the Closing,
InfoCast shall deliver to i360 the following, all in form and substance
reasonably satisfactory to counsel for i360.

(a) Certified copies of resolutions duly adopted by the Board of Directors
of InfoCast authorizing and approving the execution and delivery of this
Agreement by InfoCast and the performance of its obligations hereunder.

(b) Certified copy of resolutions duly adopted by the shareholders of
InfoCast authorizing and approving the execution and delivery of this Agreement
by InfoCast and the performance of its obligations hereunder.

(d) The certificate referred to in Section 8.1.

(e) The Registration Rights Agreement set forth on Exhibit C.

(f) The Escrow Agreement set forth on Exhibit A.

(g) The Shareholder Designee Agreement set forth on Exhibit F.

Section 11.3 Documents to be Delivered by i360. At the Closing i360 shall
deliver to InfoCast, all in form and substance reasonably satisfactory to
counsel for InfoCast:

(a) Certified copies of resolutions duly adopted by the Board of
Directors of i360 authorizing and approving the execution and delivery of
this Agreement by i360 and the performance of its obligations hereunder.

(b) Certified copy of resolutions duly adopted by the shareholders of
i360 authorizing and approving the execution and delivery of this Agreement
by i360 and the performance of its obligations hereunder.

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(d) The certificate referred to in Section 9.1.

(e) The Registration Rights Agreement set forth on Exhibit C.

(f) The Escrow Agreement set forth on Exhibit A.

(g) The Shareholder Designee Agreement set forth on Exhibit F.

(h) The Shareholder Voting Agreement set forth on Exhibit B.

ARTICLE XII

TERMINATION, AMENDMENT AND WAIVER

Section 12.1 Termination. This Agreement may be terminated and the
transactions contemplated by this Agreement abandoned at any time prior to the
Closing:

(a) By mutual written consent of InfoCast and i360;

(b) By either InfoCast or i360 if the transactions contemplated by
this Agreement shall not have been consummated on or before July 15, 2000;

(c) By i360 if any condition specified in Article VIII hereto has not
been met or waived at such time as such condition can no longer be
satisfied;

(d) By InfoCast if any condition specified in Article IX hereto has
not been met or waived at such time as such condition can no longer be
satisfied; or

(e) By either InfoCast or i360 if a court of competent jurisdiction or
Governmental Authority shall have issued a final, non-appealable order,
decree or ruling or taken any other action (which order, decree or ruling
the parties hereto shall use their best efforts to lift), in each case
permanently restraining, enjoining or otherwise prohibiting the
transactions contemplated by this Agreement.

Section 12.2 Effect of Termination. Except as provided in Section 13.1
hereof, in the event of any termination of this Agreement in accordance with
Section 12.1 hereof, this Agreement shall forthwith become void and, except for
the parties' obligations under Section 7.6 hereof which shall remain in full
force and effect, there shall be no liability under this Agreement on the part
of any party hereto or their respective affiliates, officers, directors,
employees or agents by virtue of such termination.

ARTICLE XIII

MISCELLANEOUS

Section 13.1 Expenses. All costs and expenses incurred in connection with
this Agreement and the transactions contemplated hereby shall be paid by the
party incurring such costs and expenses regardless of the termination of this
Agreement or the failure to consummate the transactions contemplated hereby.

Section 13.2 Notices. All notices, requests, demands and other
communications which are required or may be given under this Agreement shall be
in writing and shall be deemed to have been duly given when delivered personally
or by facsimile transmission, in either case with receipt acknowledged, or five
days after being sent by registered or certified mail, return receipt requested,
postage prepaid:

If to InfoCast to:

InfoCast Corporation
1 Richmond Street. W., Suite 901
Toronto, Ontario M5H 3W4
Attention: Chief Executive Officer

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with a copy to:

Olshan Grundman Frome Rosenzweig & Wolosky LLP
505 Park Avenue
New York, New York 10022
Attention: Jeffrey S. Spindler, Esq.

If to i360 to:

i360 Inc.
407 West Congress Street
Tucson, Arizona 85701
Attention: President

with a copy to:

Fennemore Craig, P.C.
Suite 2600
3003 North Central Avenue
Phoenix, Arizona 85012
Attention: Sarah A. Strunk, Esq.

or to such other address as any party shall have specified by notice in writing
to the other in compliance with this Section 13.2.

Section 13.3 Entire Agreement; Amendments. This Agreement constitutes the
entire agreement among the parties hereto with respect to the subject matter
hereof and thereof and supersedes all prior agreements, representations and
understandings among the parties hereto, including that certain letter agreement
dated February 17, 2000 among the parties hereto. This Agreement may be amended
only by a writing signed by all the parties hereto.

Section 13.4 Binding Effect, Benefits, Assignments. This Agreement shall
inure to the benefit of and be binding upon the parties hereto and their
respective successors and permitted assigns; nothing in this Agreement,
expressed or implied, is intended to confer on any other person, other than the
parties hereto or their respective successors and permitted assigns, any rights,
remedies, obligations or liabilities under or by reason of this Agreement. This
Agreement may not be assigned without the prior written consent of the other
parties hereto.

Section 13.5 Applicable Law. This Agreement and the legal relations
between the parties hereto shall be governed by and construed in accordance with
the laws of the State of New York, without regard to principles of conflicts of
law.

Section 13.6 Arbitration. Any dispute, controversy or claim arising out
of or related to this Agreement, or any transactions contemplated herein, that
cannot be amicably resolved between InfoCast and i360, shall be resolved by
final and binding arbitration held in Phoenix, Arizona, in accordance with the
domestic arbitration rules of the American Arbitration Association, except as
may be modified by this Section or by mutual agreement of the parties.
Arbitration proceedings shall be conducted by a panel of three (3) persons
selected as follows: the party initiating arbitration shall select one
arbitrator and the other party shall select a second arbitrator. The two
arbitrators so selected shall select a third arbitrator as soon as possible.
Each party shall provide prompt written notice of the arbitrator selected by it
in accordance with the terms of this Agreement. No arbitrator shall have or
previously have had any significant relationship with any of the parties. The
arbitration and this Section shall be governed by Title 9 (Arbitration) of the
United States Code. The parties will, upon the request of any party, support the
consolidation of all existing disputes (if more than one dispute) under this
Agreement in a single action to be adjudicated by a single arbitration panel in
accordance with this Section.

Section 13.7 Headings. The headings and captions in this Agreement are
included for purposes of convenience only and shall not affect the construction
or interpretation of any of its provisions.

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Section 13.8 Counterparts. This Agreement may be executed simultaneously
in two or more counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument.

Section 13.9 Costs and Fees of Dispute. In the event any proceeding is
commenced by a party under this Agreement to enforce any of its terms or to
recover damages in connection with a breach of this Agreement, the prevailing
party or parties shall be entitled to recover attorneys' fees and costs
(including, without limitation, such fees and costs as may be incurred in any
bankruptcy or appellate proceeding) in an amount to be fixed by the court.

Section 13.10 Definition of Material Adverse Effect. As used in this
Agreement, any reference to any state of facts, event, change or effect having a
"Material Adverse Effect" on or with respect to either i360 or InfoCast, means
such state of facts, event, change or effect that has had or would reasonably be
expected to have a material adverse effect on the business, results of
operations or financial condition of the any change in or effect on the
business, financial condition or results of the party making such representation
and its subsidiaries, taken as a whole.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year hereinabove first set forth.

INFOCAST CORPORATION

By: /s/ JAMES W. LEECH
------------------------------------
Name: James W. Leech
Title: President

i360 INC.

By: /s/ BILL COCHRANE
------------------------------------
Name: Bill Cochrane
Title: President

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AMENDMENT NO. 1
TO THE
AGREEMENT AND PLAN OF MERGER

AMENDMENT NO. 1, dated as of the 21st day of June, 2000, by and between
InfoCast Corporation, a Nevada corporation (the "Company") and i360 Inc., a Utah
Corporation ("i360").

WITNESSETH:

WHEREAS, the undersigned have entered into an Agreement and Plan of merger
dated May 3, 2000 (the "Merger Agreement").

WHEREAS, the parties to the Merger Agreement have determined that is in
their interest to amend the Merger Agreement.

NOW THEREFORE, in consideration of the foregoing, the parties to the Merger
Agreement agree as follows:

1. Capitalized terms not defined herein shall have the meanings
attributed to them in the Merger Agreement.

2. Section 12.1(b) of the Merger Agreement is hereby amended by
replacing the reference to "July 15, 2000" with "August 15, 2000".

3. Except as modified hereby, the Merger Agreement shall remain in
full force and effect. In the event that any term of this Amendment No. 1
is inconsistent with any term of the Merger Agreement, this Amendment No. 1
shall control.

4. This Amendment No. 1 may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.

IN WITNESS WHEREOF, the undersigned have executed this Amendment No. 1 to
the Merger Agreement as of the date first written above.

INFOCAST CORPORATION

By: /s/ JAMES W. LEECH
------------------------------------
Name: President & CEO
Title: James W. Leech

i360 INC.

By: /s/ BILL COHEN
------------------------------------
Name: Bill Cohen
Title: CEO

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ANNEX C

DISSENTERS' RIGHTS STATUTE

PROVISIONS FOR DISSENTERS' RIGHTS
UNDER NEVADA REVISED STATUTES

92A.380

RIGHT OF STOCKHOLDER TO DISSENT FROM CERTAIN CORPORATE ACTIONS AND TO
OBTAIN PAYMENT FOR SHARES. -- 1. Except as otherwise provided in NRS 92A.370 to
92A.390, a stockholder is entitled to dissent from, and obtain payment of the
fair value of his shares in the event of any of the following corporate actions:

(a) Consummation of a plan of merger to which the domestic corporation
is a party:

(1) If approval by the stockholders is required for the merger by
NRS 92A.120 to 92A.160, inclusive, or the articles of incorporation and
he is entitled to vote on the merger; or

(2) If the domestic corporation is a subsidiary and is merged with
its parent under NRS 92A.180.

(b) Consummation of a plan of exchange to which the domestic
corporation is a party as the corporation whose subject owner's interests
will be acquired, if he is entitled to vote on the plan.

(c) Any corporate action taken pursuant to a vote of the stockholders
to the event that the articles of incorporation, bylaws or a resolution of
the board of directors provides that voting or nonvoting stockholders are
entitled to dissent and obtain payment for their shares.

2. A stockholder who is entitled to dissent and obtain payment under NRS
92A.300 to 92A.500, inclusive, may not challenge the corporate action creating
his entitlement unless the action is unlawful or fraudulent with respect to him
or the domestic corporation.

92A.400

LIMITATIONS ON RIGHT OF DISSENT: ASSERTION AS TO PORTIONS ONLY TO SHARES
REGISTERED TO STOCKHOLDER; ASSERTION BY BENEFICIAL STOCKHOLDER. -- 1. A
stockholder of record may assert dissenter's rights as to fewer than all of the
shares registered in his name only if he dissents with respect to all shares
beneficially owned by any one person and notifies the subject corporation in
writing of the name and address of each person on whose behalf he asserts
dissenter's rights. The rights of a partial dissenter under this subsection are
determined as if the shares as to which he dissents and his other shares were
registered in the names of different stockholders.

2. A beneficial stockholder may assert dissenter's rights as to shares held
on his behalf only if:

(a) He submits to the subject corporation the written consent of the
stockholder of record to the dissent not later than the time the beneficial
stockholder asserts dissenter's rights; and

(b) He does so with respect to all shares of which he is the
beneficial stockholder or over which he has power to direct the vote.

92A.410

NOTIFICATION OF STOCKHOLDERS REGARDING RIGHT OF DISSENT. -- 1. If a
proposed corporate action creating dissenters' rights is submitted to a vote at
a stockholders' meeting, the notice of the meeting must state that stockholders
are or may be entitled to assert dissenters' rights under NRS 92A.300 to
92A.500, inclusive, and be accompanied by a copy of those sections.

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2. If the corporate action creating dissenters' rights is taken by written
consent of the stockholders or without a vote of the stockholders, the domestic
corporation shall notify in writing all stockholders entitled to asset
dissenters' rights that the action was taken and send the dissenter's notice
described in NRS 92A.430.

92A.420

PREREQUISITES TO DEMAND FOR PAYMENT FOR SHARES. -- 1. If a proposed
corporate action creating dissenters' rights is submitted to a vote at a
stockholders' meeting, a stockholder who wishes to assert dissenter's rights:

(a) Must deliver to the subject corporation, before the vote is taken,
written notice of his intent to demand payment for his shares if the
proposed action is effectuated; and

(b) Must not vote his shares in favor of the proposed action.

2. A stockholder who does not satisfy the requirements of subsection 1 and
NRS 92A.400 is not entitled to payment for his shares under this chapter.

92A.430

DISSENTER'S NOTICE: DELIVERY TO STOCKHOLDERS ENTITLED TO ASSERT RIGHTS;
CONTENTS. -- 1. If a proposed corporate action creating dissenters' rights is
authorized at a stockholders' meeting, the subject corporation shall deliver a
written dissenter's notice to all stockholders who satisfied the requirements to
assert those rights.

2. The dissenter's notice must be sent no later than 10 days after the
effectuation of the corporate action, and must:

(a) State where the demand for payment must be sent and where and when
certificates, if any, for shares must be deposited;

(b) Inform the holders of shares not represented by certificates to
what extent the transfer of the shares will be restricted after the demand
for payment is received;

(c) Supply a form for demanding payment that includes the date of the
first announcement to the news media or to the stockholders of the terms of
the proposed action and requires that the person asserting dissenter's
rights certify whether or not he acquired beneficial ownership of the
shares before that date;

(d) Set a date by which the subject corporation must receive the
demand for payment, which may not be less than 30 nor more than 60 days
after the date the notice is delivered; and

(e) Be accompanied by a copy of NRS 92A.300 to 92A.500, inclusive.

92A.440

DEMAND FOR PAYMENT AND DEPOSIT OF CERTIFICATES; RETENTION OF RIGHTS OF
STOCKHOLDERS -- 1. A stockholder to whom a dissenter's notice is sent must:

(a) Demand payment;

(b) Certify whether he acquired beneficial ownership of the shares
before the date required to be set forth in the dissenter's notice for this
certification; and

2. The stockholder who demands payment and deposits his certificates, if
any, before the proposed corporate action is taken retains all other rights of a
stockholder until those rights are canceled or modified by the taking of the
proposed corporate action.

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3. The stockholder who does not demand payment or deposit his certificates
where required, each by the date set forth in the dissenter's notice, is not
entitled to payment for his shares under this chapter.

92A.450

UNCERTIFICATED SHARES: AUTHORITY TO RESTRICT TRANSFER AFTER DEMAND FOR
PAYMENT; RETENTION OF RIGHTS OF STOCKHOLDER. -- 1. The subject corporation may
restrict the transfer of shares not represented by a certificate from the date
the demand for their payment is received.

2. The person for whom dissenter's rights are asserted as to shares not
represented by a certificate retains all other rights of a stockholder until
those rights are canceled or modified by the taking of the proposed corporate
action.

92A.460

PAYMENT FOR SHARES: GENERAL REQUIREMENTS. -- 1. Except as otherwise
provided in NRS 92A.470, within 30 days after receipt of a demand for payment,
the subject corporation shall pay each dissenter who complied with NRS 92A.440
the amount the subject corporation estimates to be the fair value of his shares,
plus accrued interest. The obligation of the subject corporation under this
subsection may be enforced by the district court:

(a) Of the county where the corporation's registered office is
located; or

(b) At the election of any dissenter residing or having its registered
office in this state, of the country where the dissenter resides or has its
registered office. The court shall dispose of the complaint promptly.

2. The payment must be accompanied by:

(a) The subject corporation's balance sheet as of the end of a fiscal
year ending not more than 16 months before the date of payment, a statement
of income for that year, a statement of changes in the stockholders' equity
for that year and the latest available interim financial statements, if
any;

(b) A statement of the subject corporation's estimate of the fair
value of the shares;

(d) A statement of the dissenter's rights to demand payment under NRS
92A.480; and

(e) A copy of NRS 92A.300 to 92A.500, inclusive.

92A.470

PAYMENT FOR SHARES: SHARES ACQUIRED ON OR AFTER DATE OF DISSENTER'S
NOTICE. -- 1. A subject corporation may elect to withhold payment from a
dissenter unless he was the beneficial owner of the shares before the date set
forth in the dissenter's notice as the date of the first announcement to the
news media or to the stockholders of the terms of the proposed action.

2. To the extent the subject corporation elects to withhold payment, after
taking the proposed action, it shall estimate the fair value of the shares, plus
accrued interest, and shall offer to pay this amount to each dissenter who
agrees to accept it in full satisfaction of his demand. The subject corporation
shall send with its offer a statement of its estimate of the fair value of the
shares, an explanation of how the interest was calculated, and a statement of
the dissenters' right to demand payment pursuant to NRS 92A.480.

92A.480

DISSENTER'S ESTIMATE OF FAIR VALUE: NOTIFICATION OF SUBJECT CORPORATION;
DEMAND FOR PAYMENT OF ESTIMATE. -- 1. A dissenter may notify the subject
corporation in writing of his own estimate of the fair value of his shares and
the amount of interest due, and demand
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payment of his estimate, less any payment pursuant to NRS 92A.460, or reject the
offer pursuant to NRS 92A.470 and demand payment of the fair value of his shares
and interest due, if he believes that the amount paid pursuant to NRS 92A.460 or
offered pursuant to NRS 92A.470 is less than the fair value of his shares or
that the interest due is incorrectly calculated.

2. A dissenter waives his right to demand payment pursuant to this section
unless he notifies the subject corporation of his demand in writing within 30
days after the subject corporation made or offered payment for his shares.

92A.490

LEGAL PROCEEDING TO DETERMINE FAIR VALUE: DUTIES OF SUBJECT CORPORATION;
POWERS OF COURT; RIGHTS OF DISSENTER. -- 1. If a demand for payment remains
unsettled, the subject corporation shall commence a proceeding within 60 days
after receiving the demand and petition the court to determine the fair value of
the shares and accrued interest. If the subject corporation does not commence
the proceeding within the 60-day period, it shall pay each dissenter whose
demand remains unsettled the amount demanded.

2. A subject corporation shall commence the proceeding in the district
court of the country where its registered office is located. If the subject
corporation is a foreign entity without a resident agent in the state, it shall
commence the proceeding in the country where the registered office of the
domestic corporation merged with or whose shares were acquired by the foreign
entity was located.

3. The subject corporation shall make all dissenters, whether or not
residents of Nevada, whose demands remain unsettled, parties to the proceeding
as in an action against their shares. All parties must be served with a copy of
the petition. Nonresidents may be served by registered or certified mail or by
publication as provided by law.

4. The jurisdiction of the court in which the proceeding is commenced under
subsection 2 is plenary and exclusive. The court may appoint one or more persons
as appraisers to receive evidence and recommend a decision on the question of
fair value. The appraisers have the powers described in the order appointing
them, or any amendment thereto. The dissenters are entitled to the same
discovery rights as parties in other civil proceedings.

5. Each dissenter who is made a party to the proceeding is entitled to a
judgment:

(a) For the amount, if any, by which the court finds the fair value of
his shares, plus interest, exceeds the amount paid by the subject
corporation; or

(b) For the fair value, plus accrued interest, of his after-acquired
shares for which the subject corporation elected to withhold payment
pursuant to NRS 92A.470.

92A.500

LEGAL PROCEEDING TO DETERMINE FAIR VALUE: ASSESSMENT OF COSTS AND
FEES. -- 1. The court in a proceeding to determine fair value shall determine
all of the costs of the proceeding, including the reasonable compensation and
expenses of any appraisers appointed by the court. The court shall assess the
costs against the subject corporation, except that the court may assess costs
against all or some of the dissenters, in amounts the court finds equitable, to
the extent the court finds the dissenters acted arbitrarily, vexatiously or not
in good faith in demanding payment.

2. The court may also assess the fees and expenses of the counsel and
experts for the respective parties, in amounts the court finds equitable:

(a) Against the subject corporation and in favor of all dissenters if
the court finds the subject corporation did not substantially comply with
the requirements of NRS 92A.300 to 92A.500, inclusive; or

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(b) Against either the subject corporation or a dissenter in favor of
any other party, if the court finds that the party against whom the fees
and expenses are assessed acted arbitrarily, vexatiously or not in good
faith with respect to the rights provided by NRS 92A.300 to 92A.500,
inclusive.

3. If the court finds that the services of counsel for any dissenter were
of substantial benefit to other dissenters similarly situated, and that the fees
for those services should not be assessed against the subject corporation, the
court may award to those counsel reasonable fees to be paid out of the amounts
awarded to the dissenters who were benefited.

4. In a proceeding commenced pursuant to NRS 92A.460, the court may assess
the costs against the subject corporation, except that the court may assess
costs against all or some of the dissenters who are parties to the proceeding,
in amounts the court finds equitable, to the extent the court finds that such
parties did not act in good faith in instituting the proceeding.

5. This section does not preclude any party in a proceeding commenced
pursuant to NRS 92A.460 or 92A.490 from applying the provisions of N.R.C.P. 68
or NRS 17.115.

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ANNEX D

REGISTRATION RIGHTS AGREEMENT

DATED AS OF , 2000

AMONG

INFOCAST CORPORATION

AND

THE OTHER PERSONS IDENTIFIED ON SCHEDULE I

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REGISTRATION RIGHTS AGREEMENT, dated as of ,
2000, among Infocast Corporation, a Nevada corporation (the "Company"), and the
other Persons identified on Schedule I hereto (the "Shareholders"). This
Agreement is made pursuant to the Merger Agreement dated as of ,
2000, by and among the Company and i360 Inc. (the "Merger Agreement"). The
Company has agreed to provide the Shareholders and any transferees of
Registrable Securities (as hereinafter defined) the registration rights with
respect to the Registrable Securities, as set forth in this Agreement.

The parties hereto agree as follows:

1. Definitions.

As used in this Agreement, the following capitalized terms shall have the
following meanings:

"Commission" shall mean the Securities and Exchange Commission.

"Common Stock" means the common stock, par value $.001 per share, of the
Company.

"Effective Date" means the day upon which the merger contemplated by the
Merger Agreement is declared effective.

"Holder" shall mean a Shareholder, or its transferee, who is the owner of
Registrable Securities.

"Person" shall mean an individual, partnership, corporation, business
trust, joint state company trust, unincorporated organization, joint venture, a
government authority or other entity of whatever nature.

"Prospectus" shall mean the prospectus included in any Registration
Statement, as amended or supplemented by any prospectus supplement with respect
to the terms of the offering of any portion of the Registrable Securities
covered by such Registration Statement, and all other amendments and supplements
to the Prospectus, including post-effective amendments to the Registration
Statement of which such Prospectus is a part, and all material incorporated by
reference in such Prospectus.

"Registrable Securities" shall mean the Securities, but only so long as
they remain Restricted Securities.

"Registration Expenses" shall have the meaning ascribed thereto in Section
6 hereof.

"Registration Statement" means any registration statement of the Company
which covers any of the Registrable Securities pursuant to the provisions of
this Agreement, including the Prospectus, amendments and supplements to such
Registration Statement, including post-effective amendments, all exhibits, and
all material incorporated by reference in such Registration Statement.

"Restricted Securities" means the Registrable Securities unless and until,
in the case of any such Securities, (i) they have been effectively registered
under the Securities Act and disposed of in accordance with the Registration
Statement covering them, (ii) they are distributed to the public pursuant to
Rule 144 (or any similar provision then in force) under the Securities Act, or
(iii) they are otherwise freely transferable without restriction under the
Securities Act, and Shareholders have received an opinion of their legal counsel
to such effect.

"Securities" shall mean the shares of Common Stock set forth on Schedule I
hereto.

"Securities Act" shall mean the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.

2. Securities Subject to this Agreement. The Securities entitled to the
benefits of this Agreement are the Registrable Securities.

3. Shelf Registration.

(a) Within six months following the Effective Date, the Company shall
prepare and file with the Commission a "shelf" Registration Statement covering
the Registrable Securities for resale (subject to any limitations under
Regulation M) and such additional securities that the Company in its sole
discretion may decide to register. The Registration Statement shall be on Form
S-1 or another appropriate form permitting registration of Registrable
Securities for resale by the Holders in the manner or manners designated by them
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(including, without limitation, public or private sales and one or more
underwritten offerings). The Company shall use its best efforts to cause the
Registration Statement to be declared effective under the Securities Act as
promptly as practicable after the filing thereof and to keep such Registration
Statement continuously effective under the Securities Act until the date which
is two years after the Closing Date or such earlier date when all Registrable
Securities covered by such Registration Statement have been sold or may be sold
pursuant to Rule 144 as determined by counsel to the Company pursuant to a
written opinion letter, addressed to the Holders, to such effect (the
"Effectiveness Period"); provided, however, that the Company shall not be deemed
to have used its best efforts to keep the Registration Statement effective
during the Effectiveness Period if it voluntarily takes any action that would
result in the Holders not being able to sell the Registrable Securities covered
by such Registration Statement during the Effectiveness Period, unless such
action is required under applicable law or the Company has filed a
post-effective amendment to the Registration Statement and the Commission has
not declared it effective or except as otherwise permitted by this Section 3(a).

4. Hold-Back Agreements

(a) Restrictions on Public Sale by the Holders. Subject to paragraph (b)
of this Section 4, the Holders hereby understand and agree that the registration
rights of the Holders pursuant to this Agreement and their ability to offer and
sell Registrable Securities pursuant to the Registration Statement are limited
by the provisions of the immediately following sentence. If the Company
determines in its good faith judgment that the filing of the Registration
Statement in accordance with Section 3 or the use of any Prospectus would
require the disclosure of material information which the Company has a bona fide
business purpose for preserving as confidential or the disclosure of which would
impede the Company's ability to consummate a significant transaction, upon
written notice of such determination by the Company, the rights of the Holders
to offer, sell or distribute any Registrable Securities pursuant to the
Registration Statement or to require the Company to take action with respect to
the registration or sale of any Registrable Securities pursuant to the
Registration Statement (including any action contemplated by Section 5) will for
up to 60 consecutive days in respect of a single such notice in any 12-month
period be suspended until the date upon which the Company notifies the Holders
in writing that suspension of such rights for the grounds set forth in this
Section 4(a) is no longer necessary.

(b) Limitation on Blackouts. Notwithstanding anything contained herein to
the contrary, the aggregate number of days (whether or not consecutive) during
which the Company may delay the effectiveness of the Registration Statement or
prevent offerings, sales or distributions by the Purchaser pursuant to paragraph
(a) above (a "Blackout") shall in no event exceed 90 days during any 12-month
period and no Blackout may continue in consecutive 12 month periods. Further,
the two-year period during which the Company must keep the Registration
Statement effective pursuant to Section 3(a) shall be extended for an additional
number of days equal to the number of days in any Blackout.

5. Registration Procedures. In connection with the Company's registration
and other obligations hereunder, the Company shall:

(a) In accordance with the Securities Act and the rules and
regulations of the Commission, prepare and file with the Commission a
Registration Statement in the form of an appropriate registration statement
with respect to the Registrable Securities and use its best efforts to
cause such Registration Statement to become effective and remain effective
as provided herein, and shall prepare and file with the Commission such
amendments to such Registration Statement and supplements to the Prospectus
contained therein as may be necessary to keep such Registration Statement
effective and such Registration Statement and Prospectus accurate and
complete during such period;

(b) Furnish to each Holder participating in such registration (each of
such persons participating in the registration being referred to herein as
a "Participant" in such registration) such reasonable number of copies of
the Registration Statement and Prospectus, any amendments or supplements
thereto, and such other documents as such Participant may reasonably
request in order to facilitate the public offering of the Registrable
Securities;

D-3
<PAGE> 152

(c) Use its best efforts to register or qualify the Securities covered
by such Registration Statement under such state securities or blue sky laws
of such jurisdictions as such Participants may reasonably request,
provided, however, that the Company shall not be obligated to file any
general consent to service of process or to qualify as a foreign
corporation in any jurisdiction in which it is not so qualified or to
subject itself to taxation in connection with any such registration or
qualification of such Securities;

(d) Notify the Participants in such registration, promptly after it
shall receive notice thereof, of the date and time when such Registration
Statement and each post-effective amendment thereto has become effective or
a supplement to any Prospectus forming a part of such Registration
Statement has been filed;

(e) Notify the Participants in such registration promptly of any
request by the Commission for the amending or supplementing of such
Registration Statement or Prospectus or for additional information;

(f) Prepare and file with the Commission, promptly upon the request of
any Participant in such registration, the Registration Statement and any
amendments or supplements to such Registration Statement or Prospectus
which, in the reasonable opinion of counsel for such Holders if they are
Participants, is required under the Securities Act or the rules and
regulations thereunder in connection with the distribution of the
Securities by such Holders or to otherwise comply with the requirements of
the Securities Act and such rules and regulations;

(g) Prepare and promptly file with the Commission and promptly notify
the Participants in such registration of the filing of such amendments or
supplements to such Registration Statement or Prospectus as may be
necessary to correct any statements or omissions if, at the time when a
Prospectus relating to such Securities is required to be delivered under
the Securities Act, any event has occurred as the result of which any such
Prospectus or any other Prospectus then in effect may include an untrue
statement of a material fact or omit to state any material fact required to
be stated therein or necessary to make the statements therein not
misleading;

(h) Advise the Participants in such registration, promptly after it
shall receive notice or obtain knowledge thereof, of the issuance of any
stop order by the Commission suspending the effectiveness of such
Registration Statement or the initiation or threatening of any proceeding
for that purpose and promptly use its best efforts to prevent the issuance
of any stop order or to obtain its withdrawal if such stop order should be
issued;

(i) Otherwise use its best efforts to comply with all applicable rules
and regulations of the Commission, and make generally available to the
Company's security holders earnings statements satisfying the provisions of
Section 11(a) of the Securities Act, no later than forty-five (45) days
after the end of any twelve (12) month period (or ninety (90) days, if such
a period is a fiscal year) beginning with the first month of the Company's
first fiscal quarter commencing after the effective date of a Registration
Statement;

(j) Not file any amendment or supplement to such Registration
Statement or Prospectus to which a majority in interest of the Holders
participating in such registration has objected on the grounds that such
amendment or supplement does not comply in all material respects with the
requirements of the Securities Act or the rules and regulations thereunder,
after having been furnished with a copy thereof at least three business
days prior to the filing thereof unless the Company shall have obtained an
opinion of counsel that such amendment is required under the Securities Act
or the rules or regulations adopted thereunder in connection with the
distribution of Securities by the Company or the Participants;

(k) Enter into any reasonable underwriting agreement with provisions
reasonably required by the proposed underwriter for the Participants, if
any;

(l) In the case of an underwritten offering, obtain, immediately prior
to the effectiveness of the Registration Statement and at the time of
delivery of any Registrable Securities sold pursuant thereto, a cold
comfort letter from the Company's independent public accountants in
customary form and covering such matters of the type customarily covered by
cold comfort letters as the Holders of a majority of the Registrable
Securities being sold reasonably request;

D-4
<PAGE> 153

(m) For a period of two years from the Effective Date, file with the
Commission such information as the Commission may require under Section 13
or Section 15(d) of the Securities Exchange Act of 1934, and take all
action as may be required as a condition to the availability of Rule 144
under the Securities Act (or any successor exemptive rule hereafter in
effect). For a period of two years from the Effective Date, the Company
shall furnish to any Holder of Registrable Securities upon request a
written statement executed by the Company as to the steps it has taken to
comply with the current public information requirement of Rule 144 or such
successor rule; and

(n) Not enter into any agreement with any holder or prospective holder
of any securities of the Company which would adversely affect the
registration rights granted to the Holders under this Agreement without the
written consent of the Holders of a majority of the Registrable Securities.
The Company represents and warrants to the Holders that it has no existing
agreements or obligations which would interfere in any way with its
obligations to the Holders under this Agreement.

6. Expenses of Registration. All expenses incident to the Company's
performance of or compliance with the provisions of Sections 3, 4, and 5 of this
Agreement shall be borne by the Company including without limitation:

(a) All registration and filing fees;

(b) Fees and expenses of compliance with all securities or blue sky
laws (including fees and disbursements of counsel for the Company in
connection with blue sky qualifications of the Registrable Securities;
provided, however, that the Company shall not be required to consent to
general service of process in any such state);

(d) Fees and disbursements of counsel for the Company and its
independent auditors.

Nothing in this Section 6 shall be deemed to require the Company to pay or
bear any expenses of any Participant's attorneys or accountants or any other
personal expenses or any underwriting discounts, selling commissions or similar
fees.

7. Indemnification and Contribution.

(a) Indemnification by the Company. Whenever, pursuant to Section 3, a
Registration Statement relating to the Registrable Securities is filed under the
Securities Act, the Company will indemnify and hold harmless each Participant in
the registration, each of their officers, directors and employees, and each
person, if any, who controls any such Person (collectively, the "Participant
Indemnitees" and, individually, a "Participant Indemnitee"), against any losses,
claims, damages or liabilities, joint or several, to which such Participant
Indemnitees may become subject under the Securities Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue statement
of any material fact contained in such Registration Statement, or Prospectus
contained therein, or any amendment or supplement thereto, or arise out of or
are based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, and will reimburse each Participant Indemnitee for all legal or
other expenses reasonably incurred by it in connection with investigating or
defending against such loss, claim, damage, liability or action except insofar
as such losses, claims, damages, liabilities, actions or expenses arise out of,
or are based upon, any such untrue statement or omission or allegation thereof
based upon information furnished in writing to the Company by such Participant
Indemnitee or on such Participant Indemnitee's behalf expressly for use in the
Registration Statement.

(b) Indemnification by Participants. Each Participant in such registration
will indemnify and hold harmless the Company, each of its directors, each of its
officers who has signed the Registration Statement and each other person, if
any, who controls the Company, within the meaning of the Securities Act
(collectively, the "Company Indemnitees" and, individually, a "Company
Indemnitee") and each other Company Indemnitee against all losses, claims,
damages or liabilities, joint or several, to which any of the Company
Indemnitees may become subject under the Securities Act or otherwise, insofar as
such losses,
D-5
<PAGE> 154

claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon any untrue statement or alleged untrue statement of any material
fact contained in such Registration Statement, or Prospectus contained therein,
or any amendment or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, but
only if, and to the extent that, such statement or omission was in reliance upon
and in conformity with written information furnished to the Company by such
Participant or on behalf of such Participant specifically for use in the
preparation thereof.

(c) Indemnification Procedures. Promptly after receipt by a Participant
Indemnitee or a Company Indemnitee (collectively, "Indemnitees" and,
individually, an "Indemnitee") under Section 7(a) or 7(b) hereof of notice of
the commencement of any action, such Indemnitee will, if a claim in respect
thereof is to be made against the indemnifying party under such clause, notify
the indemnifying party in writing of the commencement thereof; but the omission
so to notify the indemnifying party will not relieve the indemnifying party from
any liability which it may have to any Indemnitee otherwise than under such
clauses and such omission so to notify the indemnifying party will relieve the
indemnifying party from liability only to the extent that the indemnifying party
is prejudiced by such omission. In case any such action shall be brought against
any Indemnitee, and it shall notify the indemnifying party of the commencement
thereof, the indemnifying party shall be entitled to participate in, and, to the
extent that it may wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel satisfactory to such
Indemnitee, and after notice from the indemnifying party to such Indemnitee of
its election to assume the defense thereof, the indemnifying party shall not be
liable to such Indemnitee under such clause for any legal or other expenses
subsequently incurred by such Indemnitee in connection with the defense thereof
other than reasonable costs of investigation; provided, however, that the
Indemnitee shall have the right to employ one counsel to represent such
Indemnitee if, in the reasonable judgment of such Indemnitee, it is advisable
for such party to be represented by separate counsel because separate defenses
are available, or because a conflict of interest exists between such indemnified
and indemnifying party in respect of such claim, and in that event the
reasonable fees and expenses of such separate counsel shall be paid by the
indemnifying party. Notwithstanding the foregoing, if the Company is an
Indemnitee, the Company shall designate the one counsel, and in all other
circumstances, the one counsel shall be designated by a majority in interest
based upon the Registrable Securities of the Indemnitees. For purposes of this
Section 8 the terms "control," and "controlling person" have the meanings which
they have under the Securities Act.

(d) Contribution. If for any reason the foregoing indemnity is
unavailable, or is insufficient to hold harmless an Indemnitee, then the
indemnifying party shall contribute to the amount paid or payable by the
Indemnitee as a result of such losses, claims, damages, liabilities or expenses
(i) in such proportion as is appropriate to reflect the relative benefits
received by the indemnifying party on the one hand and the Indemnitee on the
other from the registration or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, or provides a lesser sum to the
Indemnitee than the amount hereinafter calculated, in such proportion as is
appropriate to reflect not only the relative benefits received by the
indemnifying party on the one hand and the Indemnitee on the other but also the
relative fault of the indemnifying party and the Indemnitee as well as any other
relevant equitable considerations. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.

8. Amendment and Modification. This Agreement may be amended, modified or
supplemented in any respect only by written agreement by the Company and Holders
owning a majority of the issued and outstanding shares of Registrable Securities
held by Holders provided that no such amendment shall adversely affect the
rights of the Stockholders hereunder without the written agreement of a majority
in interest thereof.

9. Governing Law. This Agreement and the rights and obligations of the
parties hereunder shall be governed by, and construed and interpreted in
accordance with, the laws of the State of New York, without giving effect to the
choice of law principles thereof.

D-6
<PAGE> 155

10. Invalidity of Provision. The invalidity or unenforceability of any
provision of this Agreement in any jurisdiction shall not affect the validity or
enforceability of the remainder of this Agreement in that jurisdiction or the
validity or enforceability of this Agreement, including that provision, in any
other jurisdiction.

11. Notices. All notices and other communications hereunder shall be in
writing and, unless otherwise provided herein, shall be deemed duly given if
delivered personally or mailed by registered or certified mail (return receipt
requested) to the parties at the following addresses or at such other address
for the party as shall be specified by like notice:

(a) If to the Company:

Infocast Corporation
1 Richmond Street West
Suite 901
Toronto, Ontario M5H 3W4
Attn: Chief Executive Officer

or as the Company shall designate to the Shareholders in writing,

with a copy to:

Olshan Grundman Frome Rosenzweig & Wolosky LLP
505 Park Avenue
New York, New York 10022
Attn: Jeffrey S. Spindler, Esq.

(b) If to a Holder, at the address contained in the Company's stock
records or as such Holder shall designate to the Company in writing,

12. Headings; Execution in Counterparts. The headings and captions
contained herein are for convenience of reference only and shall not control or
affect the meaning or construction of any provision hereof. This Agreement may
be executed in any number of counterparts, each of which shall be deemed to be
an original and all of which together shall constitute one and the same
instrument.

13. Entire Agreement. This Agreement, including any exhibits and schedules
hereto and the documents and instruments referred to herein and therein,
embodies the entire agreement and understanding of the parties hereto in respect
of the subject matter contained herein. There are no restrictions, promises,
representations, warranties, covenants or undertakings, other than those
expressly set forth or referred to herein. This Agreement supersedes all prior
agreements and understandings between the parties with respect to such subject
matter.

14. Attorneys' Fees. If any legal action or any arbitration or other
proceeding is brought for the enforcement of this Agreement, or because of an
alleged dispute, breach, default or misrepresentation in connection with any of
the provisions of this Agreement, the successful or prevailing party or parties
shall be entitled to recover such reasonable attorneys fees and other costs
incurred in that action or proceeding, in addition to any other relief to which
it or they may be entitled, as may be ordered in connection with such
proceeding.

15. Successors and Assigns. This Agreement shall be binding upon the
parties hereto and their successors and assigns.

D-7
<PAGE> 156

[REGISTRATION RIGHTS AGREEMENT SIGNATURE PAGE]

IN WITNESS WHEREOF, this Agreement has been signed by each of the parties
hereto as of the date first above written.

INFOCAST CORPORATION

By:
--------------------------------------
Name:
Title:

D-8
<PAGE> 157

[REGISTRATION RIGHTS AGREEMENT SIGNATURE PAGE]

IN WITNESS WHEREOF, this Agreement has been signed by each of the parties
hereto as of the date first above written.

SHAREHOLDER:

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

D-9
<PAGE> 158

[REGISTRATION RIGHTS AGREEMENT SIGNATURE PAGE]

IN WITNESS WHEREOF, this Agreement has been signed by each of the parties
hereto as of the date first above written.

SHAREHOLDER:

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

D-10
<PAGE> 159

[REGISTRATION RIGHTS AGREEMENT SIGNATURE PAGE]

IN WITNESS WHEREOF, this Agreement has been signed by each of the parties
hereto as of the date first above written.

SHAREHOLDER:

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

D-11
<PAGE> 160

[REGISTRATION RIGHTS AGREEMENT SIGNATURE PAGE]

IN WITNESS WHEREOF, this Agreement has been signed by each of the parties
hereto as of the date first above written.

SHAREHOLDER:

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

D-12
<PAGE> 161

SCHEDULE I

<TABLE>
<CAPTION>
I360 COMMON INFOCAST SHARES TO
SHARES PRIOR TO BE REGISTERED
MERGER AFTER MERGER
NAME TOTAL TOTAL
---- --------------- ------------------
<S> <C> <C>
COMMON SHAREHOLDERS:
GTL Trading Limited......................................... 4,500,00* 270,000
Rio Skyline A.V.V........................................... 4,500,000* 270,000
Bert E. Arnlund, NV......................................... 1,500,000 90,000
Gregg Arena & Rhonda Arena, KY.............................. 250,000 15,000
David Douglas & Ann Douglas, KY............................. 75,000 4,500
Frank C. Clark, LA.......................................... 100,000 6,000
Crowe Dreambuilders Partnership, VA......................... 252,000 15,120
John T. Johnson, LA......................................... 100,000 6,000
Luba Andersen, AZ........................................... 25,000 1,500
Paul F. Miller, NC.......................................... 100,000 6,000
Winston R. Youngblood, LA................................... 50,000 3,000
Sistena Defined Benefit Plan, OH............................ 25,000 1,500
David Kent Allen, NC........................................ 15,000 900
Thomas Edward Lavin, LA..................................... 35,000 2,100
Robert M. Covington Jr., SC................................. 53,333 3,200
Paul F. Miller, NC.......................................... 53,333 3,200
Terrence J. Lestelle, LA.................................... 5,333 320
Larry S. Winters Pamela M. Winters or the Survivor.......... 16,000 960
Thereof, NC
Beehive International, LLC, NV.............................. 266,667 16,000
Charles Durso, NY........................................... 8,000 480
Joseph D. Markiewicz, NC.................................... 26,667 1,600
Robert R. And Jacqueline A. Zeender, MD..................... 26,667 1,600
John J. Spencer Margaret B. Spencer, VA..................... 8,000 480
Michael Norville, AZ........................................ 10,000 600
Patrice Spector, AZ......................................... 10,000 600
Cheryl Norville, AZ......................................... 10,000 600
Allan J. and Alfena A. Norville, AZ......................... 15,000 900
Jerry H. Jones, AZ.......................................... 40,000 2,400
Charles H. and Anne F. Parker, AZ........................... 5,493 330
Phillip and Mimi Amos, AZ................................... 5,333 320
Peter R. Parker, AZ......................................... 4,000 240
William and Pamela Kane, AZ................................. 8,000 480
Charles D. Parker, IL....................................... 10,667 640
Charles H. Parker, MD LTD PP, AZ............................ 10,667 640
Charles Hong, MI............................................ 8,571 514
Zuher Qonja and Jamal Qonja, MI............................. 14,286 857
Eddie Bacall Jacob Becall, MI............................... 17,143 1,029
Emmet Denha, MI............................................. 28,571 1,714
Mike Bacall, MI............................................. 8,571 514
Ronald Farida, MI........................................... 42,857 2,571
Progressive Ten Investment, MI.............................. 14,286 857
John Karmo, MI.............................................. 28,571 1,714
</TABLE>

D-13
<PAGE> 162

<TABLE>
<CAPTION>
I360 COMMON INFOCAST SHARES TO
SHARES PRIOR TO BE REGISTERED
MERGER AFTER MERGER
NAME TOTAL TOTAL
---- --------------- ------------------
<S> <C> <C>
Terry and Karen Farida, MI.................................. 85,715 5,143
David Deradoorian, MI....................................... 14,286 857
Peter and Susan Najar, MI................................... 14,286 857
Nicolas J. Faranso & Michelle Faranso JTWROS, MI............ 28,571 1,714
Victor Jack Ventimiglia, Jr. MI............................. 14,286 857
PaineWebber Custodian for David J. Merzania, NV............. 71,428 4,286
Saloman Smith Barney Custodian Gregory L. Freeman ITA, CR... 71,428 4,286
Gregory L. Freeman, NV...................................... 142,857 8,571
William S. Morton, MT....................................... 250,000 15,000
LeRoy Hucke, AZ............................................. 1,283,383 77,003
William S. Stickel, MT...................................... 250,00 15,000
Kazz Industries, Inc., MT................................... 1,000,000 60,000
William G. Cochrane, Jr. AZ................................. 2,000,000 120,000
Hojat Maradi-Garakani, TN................................... 600,000 36,000
Blair Naughty, Ontario, Canada.............................. 150,000 9,000
Jay Zammit, Calagary Alberta................................ 1,000,000 60,000
Stephen D. Ridley, LA....................................... 2,000,000 120,000
Cathy Sechrist, AZ.......................................... 100,000 6,000
Larry Walter Housner, AZ.................................... 25,000 1,500
Matthew Mark Urbania, NC.................................... 550,000 33,000
Christopher John Wick, AZ................................... 200,000 12,000
Rick C. Cade, AZ............................................ 400,000 24,000
Kevin D. Rapp, KY........................................... 125,000 7,500
Sean P. Breslin, KY & AZ.................................... 125,000 7,500
Jeffrey A. Jones, AZ........................................ 25,000 1,500
Cara J. Russo, AZ........................................... 10,000 600
Roy and Shery Wood, MO...................................... 11,280 677
Leslie G. Phairis, AZ....................................... 2,820 169
Larry Wiseman, FL........................................... 531,303 31,878
Bobbie Wiseman, FL.......................................... 109,419 6,565
Sam Wood, MO................................................ 300,000 18,000
Stan Foster, GA............................................. 564,016 33,841
Dan Hollings-Hazard, AZ..................................... 592,216 35,533
John Puckett, FL............................................ 141,004 8,460
Kirk Farber, FL............................................. 112,803 6,768
Rhett Farber and Aurora Farber, FL.......................... 28,201 1,692
Robert Farber and Doris Farber, FL.......................... 11,280 677
Wiseman Family Trust, IL.................................... 28,201 1,692
Somerset Consulting Group Defined Benefit Pension Plan,
AZ........................................................ 28,201 1,692
OPTIONS SHARES-$0.10 STRIKE PRICE:
Bill Cochrane............................................... 6,250,000 187,500
Stephen D. Ridley........................................... 6,250,000 187,500
Rick Cade................................................... 100,000 3,000
Christopher John Wick....................................... 200,000 6,000
Jeffrey A. Jones............................................ 75,000 2,250
Carey Walters............................................... 500,000 15,000
</TABLE>

D-14
<PAGE> 163

<TABLE>
<CAPTION>
I360 COMMON INFOCAST SHARES TO
SHARES PRIOR TO BE REGISTERED
MERGER AFTER MERGER
NAME TOTAL TOTAL
---- --------------- ------------------
<S> <C> <C>
John Hetrick................................................ 400,000 12,000
Pam Kane.................................................... 45,000 1,350
Gina Kimball................................................ 95,000 2,850
Joseph Smith................................................ 90,000 2,700
Michael Stow................................................ 55,000 1,650
Erik Jerue.................................................. 38,000 1,140
Hugo Ugarle................................................. 50,000 1,500
Andrew Warner............................................... 10,000 300
Matt Holsonback............................................. 10,000 300
Atticus Kilough............................................. 20,000 600
Chris Hogan................................................. 10,000 300
Dan Hollings-Hazard......................................... 200,000 6,000
Stan Foster................................................. 200,000 6,000
Guy Eargle.................................................. 45,000 1,350
Tina Vindiola............................................... 10,000 300
Paul Craig.................................................. 10,000 300
Chris Stang................................................. 7,000 210
Tony Loschner............................................... 10,000 300
Linda Morgan................................................ 10,000 300
Les Duffy................................................... 10,000 300
Cathy Gawronski............................................. 10,000 300
Janice Sine................................................. 5,000 150
Kirk Farber................................................. 5,000 150
OPTION SHARES-$1.33 STRIKE PRICE:
Bill Cochrane............................................... 150,000 15,000
Stephen D. Ridley........................................... 120,000 12,000
Rick Cade................................................... 120,000 12,000
Christopher John Wick....................................... 12,000 1,200
Jeffrey A. Jones............................................ 12,000 1,200
Carey Walters............................................... 120,000 12,000
John Hetrick................................................ 54,000 5,400
Pam Kane.................................................... 45,000 4,500
Gina Kimball................................................ 54,000 5,400
Joseph Smith................................................ 3,000 300
Michael Stow................................................ 12,000 1,200
Erik Jerue.................................................. 12,000 1,200
Hugo Ugarte................................................. 12,000 1,200
Atticus Kilough............................................. 20,001 2,000
Chris Hogan................................................. 3,000 300
Dan Hollings-Hazard......................................... 20,001 2,000
Stan Foster................................................. 19,800 1,980
Tina Vindiola............................................... 3,000 300
Paul Craig.................................................. 3,000 300
Tony Loschner............................................... 3,000 300
Linda Morgan................................................ 3,000 300
Les Duffy................................................... 9,000 900
</TABLE>

D-15
<PAGE> 164

<TABLE>
<CAPTION>
I360 COMMON INFOCAST SHARES TO
SHARES PRIOR TO BE REGISTERED
MERGER AFTER MERGER
NAME TOTAL TOTAL
---- --------------- ------------------
<S> <C> <C>
Cathy Gawronski............................................. 9,000 900
LeRoy Hucke................................................. 165,000 16,500
Cathy Sechrist.............................................. 9,000 900
Kirk Farber................................................. 9,000 900
John Puckett................................................ 9,000 900
Anmar Sarafa................................................ 20,001 2,000
2,061,480
</TABLE>

---------------
* After conversion of preferred shares held by GTL and Rio.

D-16
<PAGE> 165

ANNEX E

2000 STOCK OPTION PLAN

INFOCAST CORPORATION

2000 STOCK OPTION PLAN

(1) PURPOSE OF THE PLAN.

This 2000 Stock Option Plan (the "Plan") is intended as an incentive, to
retain in the employ of and as directors, consultants and advisors to INFOCAST
CORPORATION, a Nevada corporation (the "Company") and any Subsidiary of the
Company, within the meaning of Section 424(f) of the United States Internal
Revenue Code of 1986, as amended (the "Code"), persons of training, experience
and ability, to attract new employees, directors, advisors and consultants whose
services are considered valuable, to encourage the sense of proprietorship and
to stimulate the active interest of such persons in the development and
financial success of the Company and its Subsidiaries.

It is further intended that certain options granted pursuant to the Plan
shall constitute incentive stock options within the meaning of Section 422 of
the Code (the "Incentive Options") while certain other options granted pursuant
to the Plan shall be nonqualified stock options (the "Nonqualified Options").
Incentive Options and Nonqualified Options are hereinafter referred to
collectively as "Options."

The Company intends that the Plan meet the requirements of Rule 16b-3
("Rule 16b-3") promulgated under the Securities Exchange Act of 1934, as amended
(the "Exchange Act") and that transactions of the type specified in
subparagraphs (c) to (f) inclusive of Rule 16b-3 by officers and directors of
the Company pursuant to the Plan will be exempt from the operation of Section
16(b) of the Exchange Act. Further, the Plan is intended to satisfy the
performance-based compensation exception to the limitation on the Company's tax
deductions imposed by Section 162(m) of the Code. In all cases, the terms,
provisions, conditions and limitations of the Plan shall be construed and
interpreted consistent with the Company's intent as stated in this Section 1.

(2) ADMINISTRATION OF THE PLAN.

The Board of Directors of the Company (the "Board") shall appoint and
maintain as administrator of the Plan a Committee (the "Committee") consisting
of two or more directors that are "Non-Employee Directors" (as such term is
defined in Rule 16b-3) and "Outside Directors" (as such term is defined in
Section 162(m) of the Code), which shall serve at the pleasure of the Board. The
Committee, subject to Sections 3 and 5 hereof, shall have full power and
authority to designate recipients of Options, to determine the terms and
conditions of respective Option agreements (which need not be identical) and to
interpret the provisions and supervise the administration of the Plan. The
Committee shall have the authority, without limitation, to designate which
Options granted under the Plan shall be Incentive Options and which shall be
Nonqualified Options. To the extent any Option does not qualify as an Incentive
Option, it shall constitute a separate Nonqualified Option.

Subject to the provisions of the Plan, the Committee shall interpret the
Plan and all Options granted under the Plan, shall make such rules as it deems
necessary for the proper administration of the Plan, shall make all other
determinations necessary or advisable for the administration of the Plan and
shall correct any defects or supply any omission or reconcile any inconsistency
in the Plan or in any Options granted under the Plan in the manner and to the
extent that the Committee deems desirable to carry into effect the Plan or any
Options. The act or determination of a majority of the Committee shall be the
act or determination of the Committee and any decision reduced to writing and
signed by all of the members of the Committee shall be fully effective as if it
had been made by a majority at a meeting duly held. Subject to the provisions of
the Plan, any action taken or determination made by the Committee pursuant to
this and the other Sections of the Plan shall be conclusive on all parties.

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In the event that for any reason the Committee is unable to act or if the
Committee at the time of any grant, award or other acquisition under the Plan of
Options or Stock as hereinafter defined does not consist of two or more
Non-Employee Directors, or if there shall be no such Committee, then the Plan
shall be administered by the Board, and references herein to the Committee
(except in the proviso to this sentence) shall be deemed to be references to the
Board, and any such grant, award or other acquisition may be approved or
ratified in any other manner contemplated by subparagraph (d) of Rule 16b-3;
provided, however, that options granted to the Company's Chief Executive Officer
or to any of the Company's other four most highly compensated officers that are
intended to qualify as performance-based compensation under Section 162(m) of
the Code may only be granted by the Committee.

(3) DESIGNATION OF OPTIONEES.

The persons eligible for participation in the Plan as recipients of Options
(the "Optionees") shall include employees, officers and directors of, and
consultants and advisors to, the Company or any Subsidiary; provided that
Incentive Options may only be granted to employees of the Company and the
Subsidiaries. In selecting Optionees, and in determining the number of shares to
be covered by each Option granted to Optionees, the Committee may consider the
office or position held by the Optionee or the Optionee's relationship to the
Company, the Optionee's degree of responsibility for and contribution to the
growth and success of the Company or any Subsidiary, the Optionee's length of
service, age, promotions, potential and any other factors that the Committee may
consider relevant. An Optionee who has been granted an Option hereunder may be
granted an additional Option or Options, if the Committee shall so determine.

(4) STOCK RESERVED FOR THE PLAN.

Subject to adjustment as provided in Section 7 hereof, a total of 2,000,000
shares of the Company's Common Stock, $0.001 par value per share (the "Stock"),
shall be subject to the Plan. The maximum number of shares of Stock that may be
subject to options granted under the Plan to any individual in any calendar year
shall not exceed 800,000, and the method of counting such shares shall conform
to any requirements applicable to performance-based compensation under Section
162(m) of the Code. The shares of Stock subject to the Plan shall consist of
unissued shares or previously issued shares held by any Subsidiary of the
Company, and such amount of shares of Stock shall be and is hereby reserved for
such purpose. Any of such shares of Stock that may remain unsold and that are
not subject to outstanding Options at the termination of the Plan shall cease to
be reserved for the purposes of the Plan, but until termination of the Plan the
Company shall at all times reserve a sufficient number of shares of Stock to
meet the requirements of the Plan. Should any Option expire or be canceled prior
to its exercise in full or should the number of shares of Stock to be delivered
upon the exercise in full of an Option be reduced for any reason, the shares of
Stock theretofore subject to such Option may be subject to future Options under
the Plan, except where such reissuance is inconsistent with the provisions of
Section 162(m) of the Code.

(5) TERMS AND CONDITIONS OF OPTIONS.

Options granted under the Plan shall be subject to the following conditions
and shall contain such additional terms and conditions, not inconsistent with
the terms of the Plan, as the Committee shall deem desirable:

(a) Option Price. The purchase price of each share of Stock purchasable
under an Incentive Option shall be determined by the Committee at the time of
grant, but shall not be less than 100% of the Fair Market Value (as defined
below) of such share of Stock on the date the Option is granted; provided,
however, that with respect to an Optionee who, at the time such Incentive Option
is granted, owns (within the meaning of Section 424(d) of the Code) more than
10% of the total combined voting power of all classes of stock of the Company or
of any Subsidiary, the purchase price per share of Stock shall be at least 110%
of the Fair Market Value per share of Stock on the date of grant. The purchase
price of each share of Stock purchasable under a Nonqualified Option shall not
be less than 80% of the Fair Market Value of such share of Stock on the date the
Option is granted; provided, however, that if an option granted to the Company's
Chief Executive Officer or to any of the Company's other four most highly
compensated officers is intended to qualify as performance-
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based compensation under Section 162(m) of the Code, the exercise price of such
Option shall not be less than 100% of the Fair Market Value (as such term is
defined below) of such share of Stock on the date the Option is granted. The
exercise price for each Option shall be subject to adjustment as provided in
Section 7 below. Fair Market Value means the closing price of publicly traded
shares of Stock on the principal securities exchange on which shares of Stock
are listed (if the shares of Stock are so listed), or on the NASDAQ Stock Market
(if the shares of Stock are regularly quoted on the NASDAQ Stock Market), or, if
not so listed or regularly quoted, the mean between the closing bid and asked
prices of publicly traded shares of Stock in the over-the-counter market, or, if
such bid and asked prices shall not be available, as reported by any nationally
recognized quotation service selected by the Company, or as determined by the
Committee in a manner consistent with the provisions of the Code. Anything in
this Section 5(a) to the contrary notwithstanding, in no event shall the
purchase price of a share of Stock be less than the minimum price permitted
under the rules and policies of any national securities exchange on which the
shares of Stock are listed.

(b) Option Term. The term of each Option shall be fixed by the Committee,
but no Option shall be exercisable more than ten years after the date such
Option is granted and in the case of an Incentive Option granted to an Optionee
who, at the time such Incentive Option is granted, owns (within the meaning of
Section 424(d) of the Code) more that 10% of the total combined voting power of
all classes of stock of the Company or of any Subsidiary, no such Incentive
Option shall be exercisable more than five years after the date such Incentive
Option is granted.

(c) Exercisability. Subject to Section 5(j) hereof, Options shall be
exercisable at such time or times and subject to such terms and conditions as
shall be determined by the Committee at the time of grant.

(d) Method of Exercise. Options to the extent then exercisable may be
exercised in whole or in part at any time during the option period, by giving
written notice to the Company specifying the number of shares of Stock to be
purchased, accompanied by payment in full of the purchase price, in cash, by
check or such other instrument as may be acceptable to the Committee. As
determined by the Committee, in its sole discretion, at or after grant, payment
in full or in part may be made at the election of the Optionee (i) in the form
of Stock owned by the Optionee (based on the Fair Market Value of the Stock on
the trading day before the Option is exercised) which is not the subject of any
pledge or security interest, (ii) in the form of shares of Stock withheld by the
Company from the shares of Stock otherwise to be received with such withheld
shares of Stock having a Fair Market Value on the date of exercise equal to the
exercise price of the Option, or (iii) by a combination of the foregoing,
provided that the combined value of all cash and cash equivalents and the Fair
Market Value of any shares surrendered to the Company is at least equal to such
exercise price and except with respect to (ii) above, such method of payment
will not cause a disqualifying disposition of all or a portion of the Stock
received upon exercise of an Incentive Option. An Optionee shall have the right
to dividends and other rights of a stockholder with respect to shares of Stock
purchased upon exercise of an Option at such time as the Optionee has given
written notice of exercise and has paid in full for such shares and has
satisfied such conditions that may be imposed by the Company with respect
thereto.

(e) Non-transferability of Options. Options are not transferable and may
be exercised solely by the Optionee during his lifetime or after his death by
the person or persons entitled thereto under his will or the laws of descent and
distribution. The Committee, in its sole discretion, may permit a transfer of a
Nonqualified Option to (i) a trust for the benefit of the Optionee or (ii) a
member of the Optionee's immediate family (or a trust for his or her benefit).
Any attempt to transfer, assign, pledge or otherwise dispose of, or to subject
to execution, attachment or similar process, any Option contrary to the
provisions hereof shall be void and ineffective and shall give no right to the
purported transferee.

(f) Termination by Death. Unless otherwise determined by the Committee at
grant, if any Optionee's employment with or service to the Company or any
Subsidiary terminates by reason of death, the Option may thereafter be
exercised, to the extent then exercisable (or on such accelerated basis as the
Committee shall determine at or after grant), by the legal representative of the
estate or by the legatee of the Optionee under the will of the Optionee, for a
period of one year after the date of such death or until the expiration of the
stated term of such Option as provided under the Plan, whichever period is
shorter.

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(g) Termination by Reason of Disability. Unless otherwise determined by
the Committee at grant, if any Optionee's employment with or service to the
Company or any Subsidiary terminates by reason of total and permanent
disability, any Option held by such Optionee may thereafter be exercised, to the
extent it was exercisable at the time of termination due to Disability (or on
such accelerated basis as the Committee shall determine at or after grant), but
may not be exercised after 30 days after the date of such termination of
employment or service or the expiration of the stated term of such Option,
whichever period is shorter; provided, however, that, if the Optionee dies
within such 30 day period, any unexercised Option held by such Optionee shall
thereafter be exercisable to the extent to which it was exercisable at the time
of death for a period of one year after the date of such death or for the stated
term of such Option, whichever period is shorter.

(h) Termination by Reason of Retirement. Unless otherwise determined by
the Committee at grant, if any Optionee's employment with or service to the
Company or any Subsidiary terminates by reason of Normal or Early Retirement (as
such terms are defined below), any Option held by such Optionee may thereafter
be exercised to the extent it was exercisable at the time of such Retirement (or
on such accelerated basis as the Committee shall determine at or after grant),
but may not be exercised after 30 days after the date of such termination of
employment or service or the expiration of the stated term of such Option,
whichever period is shorter; provided, however, that, if the Optionee dies
within such 30 day period, any unexercised Option held by such Optionee shall
thereafter be exercisable, to the extent to which it was
exercisable at the time of death, for a period of one year after the date of
such death or for the stated term of such Option, whichever period is shorter.

For purposes of this paragraph (h), Normal Retirement shall mean retirement
from active employment with the Company or any Subsidiary on or after the normal
retirement date specified in the applicable Company or Subsidiary pension plan
or if no such pension plan, age 65. Early Retirement shall mean retirement from
active employment with the Company or any Subsidiary pursuant to the early
retirement provisions of the applicable Company or Subsidiary pension plan or if
no such pension plan, age 55.

(i) Other Termination. Unless otherwise determined by the Committee at
grant, if any Optionee's employment with or service to the Company or any
Subsidiary terminates for any reason other than death, Disability or Normal or
Early Retirement, the Option shall thereupon terminate, except that the portion
of any Option that was exercisable on the date of such termination of employment
or service may be exercised for the lesser of 30 days after the date of
termination or the balance of such Option's term if the Optionee's employment or
service with the Company or any Subsidiary is terminated by the Company or such
Subsidiary without cause (the determination as to whether termination was for
cause to be made by the Committee). The transfer of an Optionee from the employ
or service of the Company to the employ of or service to a Subsidiary, or vice
versa, or from one Subsidiary to another, shall not be deemed to constitute a
termination of employment or service for purposes of the Plan.

(j) Limit on Value of Incentive Option. The aggregate Fair Market Value,
determined as of the date the Incentive Option is granted, of Stock for which
Incentive Options are exercisable for the first time by any Optionee during any
calendar year under the Plan (and/or any other stock option plans of the Company
or any Subsidiary) shall not exceed $100,000.

(k) Transfer of Incentive Option Shares. The stock option agreement
evidencing any Incentive Options granted under this Plan shall provide that if
the Optionee makes a disposition, within the meaning of Section 424(c) of the
Code and regulations promulgated thereunder, of any share or shares of Stock
issued to him upon exercise of an Incentive Option granted under the Plan within
the two-year period commencing on the day after the date of the grant of such
Incentive Option or within a one-year period commencing on the day after the
date of transfer of the share or shares to him pursuant to the exercise of such
Incentive Option, he shall, within 10 days after such disposition, notify the
Company thereof and immediately deliver to the Company any amount of United
States federal, state and local income tax withholding required by law.

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(6) Term of Plan.

No Option shall be granted pursuant to the Plan on or after June 14, 2010,
but Options theretofore granted may extend beyond that date.

(7) Capital Change of the Company.

In the event of any merger, reorganization, consolidation,
recapitalization, stock dividend, or other change in corporate structure
affecting the Stock, the Committee shall make an appropriate and equitable
adjustment in the number and kind of shares reserved for issuance under the Plan
and in the number and option price of shares subject to outstanding Options
granted under the Plan, to the end that after such event each Optionee's
proportionate interest shall be maintained as immediately before the occurrence
of such event.

(8) Purchase for Investment.

Unless the Options and shares covered by the Plan have been registered
under the Securities Act of 1933, as amended (the "Securities Act"), or the
Company has determined that such registration is unnecessary, each person
exercising an Option under the Plan may be required by the Company to give a
representation in writing that he is acquiring the shares for his own account
for investment and not with a view to, or for sale in connection with, the
distribution of any part thereof.

(9) Taxes.

The Company may make such provisions as it may deem appropriate, consistent
with applicable law, in connection with any Options granted under the Plan with
respect to the withholding of any taxes or any other tax matters.

(10) Effective Date of Plan.

The Plan shall be effective on June 14, 2000, provided however that the
Plan shall subsequently be approved by majority vote of the Company's
stockholders not later than June 13, 2001.

(11) Amendment and Termination.

The Board may amend, suspend, or terminate the Plan, except that no
amendment shall be made that would impair the rights of any Optionee under any
Option theretofore granted without his consent, and except that no amendment
shall be made which, without the approval of the stockholders of the Company
would:

(a) materially increase the number of shares that may be issued under
the Plan, except as is provided in Section 7;

(b) materially increase the benefits accruing to the Optionees under
the Plan;

(d) decrease the exercise price of an Incentive Option to less than
100% of the Fair Market Value per share of Stock on the date of grant
thereof or the exercise price of a Nonqualified Option to less than 80% of
the Fair Market Value per share of Stock on the date of grant thereof; or

(e) extend the term of any Option beyond that provided for in Section
5(b).

The Committee may amend the terms of any Option theretofore granted,
prospectively or retroactively, but no such amendment shall impair the rights of
any Optionee without Optionee's consent. The Committee may also substitute new
Options for previously granted Options, including options granted under other
plans applicable to the participant and previously granted Options having higher
option prices, upon such terms as the Committee may deem appropriate.

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(12) Government Regulations.

The Plan, and the grant and exercise of Options hereunder, and the
obligation of the Company to sell and deliver shares under such Options, shall
be subject to all applicable laws, rules and regulations, and to such approvals
by any governmental agencies, national securities exchanges and interdealer
quotation systems as may be required.

(13) General Provisions.

(a) Certificates. All certificates for shares of Stock delivered under the
Plan shall be subject to such stop transfer orders and other restrictions as the
Committee may deem advisable under the rules, regulations and other requirements
of the Securities and Exchange Commission, or other securities commission having
jurisdiction, any applicable Federal or state securities law, any stock exchange
or interdealer quotation system upon which the Stock is then listed or traded
and the Committee may cause a legend or legends to be placed on any such
certificates to make appropriate reference to such restrictions.

(b) Employment Matters. The adoption of the Plan shall not confer upon any
Optionee of the Company or any Subsidiary any right to continued employment or,
in the case of an Optionee who is a director, continued service as a director,
with the Company or a Subsidiary, as the case may be, nor shall it interfere in
any way with the right of the Company or any Subsidiary to terminate the
employment of any of its employees, the service of any of its directors or the
retention of any of its consultants or advisors at any time.

(c) Limitation of Liability. No member of the Board or the Committee, or
any officer or employee of the Company acting on behalf of the Board or the
Committee, shall be personally liable for any action, determination or
interpretation taken or made in good faith with respect to the Plan, and all
members of the Board or the Committee and each and any officer or employee of
the Company acting on their behalf shall, to the extent permitted by law, be
fully indemnified and protected by the Company in respect of any such action,
determination or interpretation.

(d) Registration of Stock. Notwithstanding any other provision in the
Plan, no Option may be exercised unless and until the Stock to be issued upon
the exercise thereof has been registered under the Securities Act and applicable
state securities laws, or are, in the opinion of counsel to the Company, exempt
from such registration in the United States. The Company shall not be under any
obligation to register under applicable federal or state securities laws any
Stock to be issued upon the exercise of an Option granted hereunder in order to
permit the exercise of an Option and the issuance and sale of the Stock subject
to such Option, although the Company may in its sole discretion register such
Stock at such time as the Company shall determine. If the Company chooses to
comply with such an exemption from registration, the Stock issued under the Plan
may, at the direction of the Committee, bear an appropriate restrictive legend
restricting the transfer or pledge of the Stock represented thereby, and the
Committee may also give appropriate stop transfer instructions with respect to
such Stock to the Company's transfer agent.

INFOCAST CORPORATION
JUNE 14, 2000

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<PAGE> 171

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF

INFOCAST CORPORATION

PROXY -- SPECIAL MEETING OF SHAREHOLDERS AUGUST 14, 2000

The undersigned, a shareholder of InfoCast Corporation, a Nevada
corporation (the "Company"), does hereby constitute and appoint James
Leech and Herve Seguin and each of them, the true and lawful attorneys and
proxies with full power of substitution, for and in the name, place and
stead of the undersigned, to vote all of the shares of Common Stock of the
Company that the undersigned would be entitled to vote if personally
present at the Special Meeting of Shareholders of the Company to be held
at the offices of Olshan Grundman Frome Rosenzweig & Wolosky LLP, located
at 505 Park Avenue, New York, New York 10022, on August 14, 2000, at 10:00
a.m., local time, or at any adjournment or adjournments thereof.

The undersigned hereby instructs said proxies or their substitutes as
set forth below.

1. TO APPROVE THE MERGER.

[ ] FOR [ ] AGAINST [ ] ABSTAIN

2. TO APPROVE THE ADOPTION OF THE 2000 STOCK OPTION PLAN.

[ ] FOR [ ] AGAINST [ ] ABSTAIN

3. TO VOTE WITH DISCRETIONARY AUTHORITY WITH RESPECT TO ALL OTHER MATTERS
THAT MAY PROPERLY COME BEFORE THE MEETING.

THIS PROXY WILL BE VOTED IN ACCORDANCE WITH ANY DIRECTIONS
HEREINBEFORE GIVEN. UNLESS OTHERWISE SPECIFIED, THIS PROXY WILL BE VOTED
TO APPROVE THE MERGER, TO APPROVE THE ADOPTION OF THE 2000 STOCK OPTION
PLAN AND IN ACCORDANCE WITH THE DISCRETION OF THE PROXIES OR PROXY WITH
RESPECT TO ANY OTHER BUSINESS TRANSACTED AT THE MEETING.

(continued, and to be signed, on other side)
<PAGE> 172

(continued from other side)

THE UNDERSIGNED HEREBY REVOKES ANY PROXY OR PROXIES HERETOFORE
GIVEN AND RATIFIES AND CONFIRMS ALL THAT THE PROXIES APPOINTED HEREBY,
OR ANY OF THEM, OR THEIR SUBSTITUTES, MAY LAWFULLY DO OR CAUSE TO BE
DONE BY VIRTUE HEREOF.

Dated: , 2000
----------------------------

-------------------------------(L.S.)

-------------------------------(L.S.)
SIGNATURE(S)

NOTE: PLEASE SIGN EXACTLY AS
YOUR NAME OR NAMES APPEAR
HEREON. WHEN SIGNING AS
ATTORNEY, EXECUTOR,
ADMINISTRATOR, TRUSTEE OR
GUARDIAN, PLEASE INDICATE THE
CAPACITY IN WHICH SIGNING. WHEN
SIGNING AS JOINT TENANTS, ALL
PARTIES IN THE JOINT TENANCY
MUST SIGN. WHEN A PROXY IS
GIVEN BY A CORPORATION, IT
SHOULD BE SIGNED WITH FULL
CORPORATE NAME BY A DULY
AUTHORIZED OFFICER AND THE
CORPORATE SEAL AFFIXED.

PLEASE MARK, DATE, SIGN AND
MAIL THIS PROXY IN THE ENVELOPE
PROVIDED FOR THIS PURPOSE. NO
POSTAGE IS REQUIRED IF MAILED
IN THE UNITED STATES.