8-K/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K/A

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report:  April 22, 2005
(Date of earliest event reported)

CGI HOLDING CORPORATION

(Exact name of registrant as specified in its charter)

Nevada	33-19980-D	87-0450450
(State or other jurisdiction of incorporation)	(Commission File No.)	(IRS Employer Identification No.)

5 Revere Drive, Suite 510
Northbrook, Illinois 60062

(Address of Principal Executive Offices)

(847) 562-0177

(Registrant’s telephone number, including area code)

NOT APPLICABLE

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o          Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o          Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o          Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o          Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

CGI Holding Corporation d/b/a Think Partnership Inc., a Nevada corporation (the “Company”) is filing this Current Report on Form 8-K/A in order to amend Form 8-K filed on April 27, 2005 (SEC File No. 33-19980-D), and incorporated herein by reference, to provide certain financial disclosures required by Item 9.01 with respect to the acquisition of Primary Ads, Inc.

Item 9.01 Financial Statements and Exhibits

(a)         Financial Statements of the Businesses Acquired.

Attached hereto as Exhibit 99.1 are the audited balance sheets of Primary Ads, Inc. as of December 31, 2004 and 2003 and the related statements of income and retained earnings (accumulated deficit) and cash flows for the periods then ended.

Attached hereto as Exhibit 99.2 are the unaudited balance sheets of Primary Ads, Inc. as of March 31, 2005 and 2004 and the related unaudited statements of income and retained earnings and cash flows for the periods then ended.

(b)         Pro Forma Financial Information

Attached hereto as Exhibit 99.3 is the unaudited combined pro forma balance sheet as of March 31, 2005 and the unaudited pro forma combined statements of operations for the three months then ended and the year ended December 31, 2004.

(c)Exhibits

99.1Audited balance sheets of Primary Ads, Inc. as of December 31, 2004 and 2003 and the related statements of income and retained earnings (accumulated deficit) and cash flows for the periods then ended.

99.2Unaudited balance sheets of Primary Ads, Inc. as of March 31, 2005 and 2004 and the related unaudited statements of income and retained earnings and cash flows for the periods then ended.

99.3Unaudited combined pro forma balance sheet as of March 31, 2005 and the unaudited pro forma combined statements of operations for the three months then ended and the year ended December 31, 2004.

This Current Report on Form 8-K/A and attachments hereto contain forward-looking statements.  These statements reflect our current understanding with respect to planned future events and are based on assumptions and subject to

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risks and uncertainties.  Given these uncertainties, you should not place undue reliance on these forward-looking statements.  These forward looking statements represent our estimates and assumptions only as of the date of this report, and we do not assume any obligation to update any of these statements.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Dated: July 7, 2005
	CGI HOLDING CORPORATION.
	By:	/s/ Jody Brown
	Name:		Jody Brown
	Title:		Chief Financial Officer

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EX-99.1

Exhibit 99.1

Independent Auditor’s Report

PrimaryAds Inc.

North Plainfield, New Jersey

We have audited the accompanying balance sheets of PrimaryAds Inc. as of December 31, 2004 and 2003, and the related statements of income and retained earnings (accumulated deficit) and cash flows for the year ended December 31, 2004 and the period from October 18, 2003 (date of inception) through December 31, 2003.  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 of America.  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 audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of PrimaryAds Inc. as of December 31, 2004 and 2003, and the results of its operations and its cash flows for the year ended December 31, 2004 and the period from October 18, 2003 (date of inception) through December 31, 2003, in conformity with accounting principles generally accepted in the United States of America.

/s/ Blackman Kallick Bartelstein

Chicago, Illinois

April 20, 2005

PrimaryAds Inc.

Balance Sheets

December 31, 2004 and 2003

	2004		2003
Assets
Current Assets
Cash	$	24,883	$	7,761
Accounts Receivable	1,198,197		16,811
Total Current Assets	1,223,080		24,572
Computers(Net of Accumulated Depreciation)	1,507		2,512
Domain Name(Net of Accumulated Amortization)	24,647		37,647
Total Assets	$	1,249,234	$	64,731
Liabilities and Stockholders’ Equity(Deficit)
Current Liabilities
Accounts Payable	$	1,063,444	$	14,251
License fees payable	14,459		—
State corporate taxes payable	24,987		500
Due to stockholder	—		59,000
Total Current Liabilities	1,102,890		73,751
Stockholders’ Equity(Deficit)
Common Stock – No par value; authorized – 100 shares in 2004 and 2003; issued and outstanding – 100 shares and 65 shares in 2004 and 2003, respectively	10,000		1,000
Additional Paid-In-Capital	3,679		—
Retained Earnings(Accumulated Deficit)	132,665		(10,020		)
Total Stockholders’ Equity(Deficit)	146,344		(9,020		)
Total Liabilities and Stockholders’ Equity(Deficit)	$	1,249,234	$	64,731

The accompanying notes are an integral part of the financial statements.

PrimaryAds Inc.

Statements of Income and Retained Earnings(Accumulated Deficit)

Year Ended December 31, 2004 and period from October 18, 2003(Date of Inception) through December 31, 2003

	2004			2003
Revenue	$	12,591,072		$	17,378
Cost of Sales	9,426,961			14,250
Gross Profit	3,164,111			3,128
Operating Expenses
Payroll and payroll taxes	1,036,384			—
Licenses	103,877			5,500
Professional Fees	34,282			—
Advertising	28,137			—
Amortization	13,000			1,353
Office Expense	12,521			1,322
Outside Services	7,185			2,905
Insurance	9,798			940
Depreciation	1,005			628
Total Operating Expenses	1,246,189			12,648
Income (Loss) from Operations	1,917,922			(9,520		)
Income Tax Expense	25,237			500
Net Income (Loss)	1,892,685			(10,020		)
Accumulated Deficit, Beginning of Year	(10,020		)	—
Less: Distributions	(1,750,000		)	—
Retained Earnings(Accumulated Deficit), End of Year	$	132,665		$	(10,020	)

The accompanying notes are an integral part of the financial statements.

PrimaryAds Inc.

Statement of Cash Flows

Year Ended December 31, 2004 and Period from October 18, 2003(Date of Inception) through December 31, 2003

	2004			2003
Cash Flows from Operating Activities
Net Income(Loss)	$	1,892,685		(10,020		)
Adjustments to reconcile net income(loss) to net cash provided by operating activities
Depreciation and Amortization	14,005			1,981
Noncash compensation for equity	3,679			—
Changes in operating assets and liabilities
Accounts Receivable	(1,181,386		)	(16,811		)
Accounts Payable	1,049,193			14,251
License fees payable	14,459			—
State corporate taxes payable	24,487			500
Total Adjustments	(75,563		)	(79		)
Net Cash Provided by (Used in) Operating Activities	1,817,122			(10,099		)
Cash Flow from Investing Activity
Purchase of computers	—			(3,140		)
Purchase of domain name	—			(39,000		)
Net Cash Used in Investing Activities	—			(42,140		)
Cash Flows from Financing Activities
Net (repayments to) borrowing from stockholder	(50,000		)	59,000
Proceeds from sale of common stock	—			1,000
Stockholder distributions	(1,750,000		)	—
Net Cash (Used in) Provided by Financing Activities	(1,800,000		)	60,000
Net Increase in Cash	17,122			7,761
Cash, Beginning of Period	7,761			—
Cash, End of Period	$	24,883		$	7,761
Noncash Investing and Financing Activities Stockholder loan converted to common stock	$	9,000		$	—

The accompanying notes are an integral part of the financial statements.

PrimaryAds Inc.

Notes to Financial Statements

Year Ended December 31, 2004 and Period from October 18, 2003(Date of Inception)
through December 31, 2003

Note 1 - Organization and Summary of Significant Accounting Policies

Organization

PrimaryAds Inc. (PrimaryAds) formed on October 18, 2003, began operation in November 2003 and is a provider of affiliate marketing services that connects online publishers with advertisers.  The Company derives its revenue primarily from a form of performance marketing known as cost-per-action (“CPA”) advertising.  Under a CPA scenario, the advertiser compensates the Company when an Internet user performs a desired action (such as completing an advertiser’s registration form or buying its product) through a publisher in the Company’s network running the advertisement.  A significant portion of the fee received by the Company is paid to the publisher.

Use of Estimates and Critical Accounting Policies

Accounting principles generally accepted in the United States of America require the management of the Company to make estimates and assumptions in the preparation of these financial statements that affect the reported amounts of assets and liabilities as of the date of the financial statements and the reported amounts of revenue and expenses during the reporting period.  Actual results could differ from these estimates.

The most significant area that requires management judgment is revenue recognition.  The accounting policies for this area are discussed below.

Revenue Recognition

The Company recognizes revenue in accordance with Staff Accounting Bulletin (“SAB”) No. 104, “Revenue Recognition in Financial Statements.”  Under SAB 104, the Company recognizes revenue when the following criteria have been met:  persuasive evidence of an arrangement exists, the fees are fixed and determinable, no significant Company obligations remain and collection of the related receivable is reasonably assured.  Revenue is recognized when the related services are performed, provided that no significant Company obligations remain, the collection of the resulting receivable is reasonably assured and the fees are fixed and determinable.

In accordance with Emerging Issues Task Force Issue 99-19, “Reporting Revenue Gross as a Principal versus Net as an Agent” (“EITF 99-19”), the Company records as revenue the gross amount received from advertisers and the amount paid to the publishers placing the advertisements as cost of sales.

Cash

Substantially all cash is maintained at one financial institution and cash balances may, from time to time, exceed federally insured limits.  The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash.

Accounts Receivable

The Company does not require collateral or other security to support accounts receivable.  The Company routinely evaluates the collectibility of accounts receivable based on a combination of factors, such as the length of time the receivables are past due and any historical experience.  To date, the Company has collected all receivables and has not created an allowance for doubtful accounts.

Computers

The Company’s policy is to depreciate computers over five years using the double-declining balance method.

Domain Name

The domain name is initially valued at its acquisition price.  It is considered to have an estimable useful life of three years and is amortized over that life using the straight-line method.  The Company annually evaluates the remaining useful life of the domain name to determine whether events and circumstances warrant a revision to the remaining period of amortization.

Taxes

For the years ended December 31, 2004 and 2003, PrimaryAds has elected to be taxed under the provisions of Subchapter S of the Internal Revenue Code.  Accordingly, the stockholders and partners are taxed on their proportionate share of the Company’s taxable income.  As a result, no provision or liability for federal income taxes has been provided.

Note 2 - Domain Name

Domain name consists of the registered ownership of a website.  The following information pertains to the domain name as of December 31, 2004 and 2003:

	2004		2003
Cost	$	39,000	$	39,000
Accumulated Amortization	14,353		1,353
	$	24,647	$	37,647

Total amortization expense was $13,000 and $1,353 for the year ended December 31, 2004 and the period from inception (October 18, 2003) to December 31, 2003, respectively.  Estimated future amortization expense is as follows:

Year Ending December 31:
	2005	$	13,000
	2006	11,647
	Total	$	24,647

Note 3 - Stockholder Loan

During the period ended December 31, 2003, the Company’s sole stockholder issued a loan in the amount of $59,000 to the Company to fund operations.  The loan was due on demand and was noninterest-bearing.  The loan was repaid during the year ended December 31, 2004 by converting $9,000 of the principal into ninety shares of common stock and by issuing a check to the stockholder for $50,000.

Note 4 - Stock Repurchase Agreement

On January 5, 2004, PrimaryAds’ sole (“principal”) stockholder transferred a total of 35 shares of common stock to three of PrimaryAds’ employees.  Under the terms of the transfer, each recipient has granted to the principal an irrevocable option to repurchase the transferred stock should the recipient’s employment be terminated for any reason.  The options are exercisable by the principal stockholder at the price of $100 per share.  Compensation of $3,679 was recorded in 2004 related to this transaction.

Note 5 - Concentrations

For the year ended December 31, 2004, sales to each of two major customers amounted to more than 10% of total sales.  The amount of revenue from each such customer was approximately $3,877,000 and $1,996,000 during the year ended December 31, 2004.  The receivable balance for major customers was $392,790 as of December 31, 2004.  There were no major customers in 2003.

The Company has relationships with a number of online publishers.  If a critical publisher had operational problems or terminated its relationship with the Company, operations could be adversely affected.  In particular, approximately 12% of the advertising placed by the Company during the year ended December 31, 2004 was derived from one such publisher.  No such concentration existed as of December 31, 2003.

Note 6 - Advertising Expense

Advertising costs are expensed as incurred, and were $28,137 and $0 for the year ended December 31, 2004 and the period from inception (October 18, 2003) through December 31, 2003, respectively.

Note 7 - Related Party Transactions

The Company accrued commission expense for affiliate payments to an entity owned by two stockholders of the Company in the amount of $81,356 and $3,512 in 2004 and 2003, respectively.  The Company has a payable to this entity of $5,287 and $3,512 as of December 31, 2004 and 2003, respectively.

Note 8 - Operations

The Company maintains its headquarters in and conducts its operations from a personal residence.  No expenses related to the use of the residence have been included, either directly or by allocation, in the Company’s statement of income and retained earnings.  Therefore, certain expenses, such as rent or depreciation, which are generally present in the financial statements of other companies engaged in similar businesses, are not reflected in the Company’s financial statements.

Note 9 - Subsequent Event

On March 8, 2005, CGI Holding Corporation (“CGI”) entered into a letter of intent to merge, through a wholly owned subsidiary, with PrimaryAds.

The Company employed the services of a financial consulting group (the “Consultant”) in its efforts related to the acquisition.  Under the terms of the agreement with the Consultant, the Consultant will be paid a success fee upon completion of the acquisition.  The terms of that agreement call for the Consultant to receive a fee of 3.5% of the value of any consideration paid to the Company in the form of cash or stock upon the constructive receipt of such consideration.

EX-99.2

Exhibit 99.2

PrimaryAds Inc.

Balance Sheets (Unaudited)

March 31, 2005 and 2004

	2005		2004
Assets
Current Assets
Cash	$	1,288,491	$	130,937
Accounts Receivable	865,084		279,321
Total Current Assets	2,153,575		410,258
Computers(Net of Accumulated Depreciation)	1,256		2,261
Domain Name(Net of Accumulated Amortization)	21,397		34,397
Total Assets	$	2,176,228	$	446,916
Liabilities and Stockholders’ Equity
Current Liabilities
Accounts Payable	$	1,053,260	$	250,661
License fees payable	—		7,494
State corporate taxes payable	37,410		—
Deferred Revenue	17,579		—
Due to stockholder	—		50,000
Total Current Liabilities	1,108,249		308,155
Stockholders’ Equity
Common Stock – No par value; authorized – 100 shares in 2005 and 2004; issued and outstanding – 100 shares in 2005 and 2004	10,000		10,000
Additional Paid-In-Capital	3,679		3,679
Retained Earnings	1,054,300		125,082
Total Stockholders’ Equity	1,067,979		138,761
Total Liabilities and Stockholders’ Equity	$	2,176,228	$	446,916

See Accompanying Notes to Financial Statements.

PrimaryAds Inc.

Statements of Income and Retained Earnings(Unaudited)

Three Months Ended March 31, 2005 and 2004

	2005		2004
Revenue	$	5,312,820	$	508,354
Cost of Sales	4,176,718		329,893
Gross Profit	1,136,102		178,461
Operating Expenses
Payroll and payroll taxes	88,437		15,477
Licenses	52,995		10,836
Professional Fees	31,378		—
Advertising	12,235		3,511
Amortization	3,250		3,250
Office Expense	9,304		3,942
Outside Services	854		4,682
Insurance	3,340		1,410
Depreciation	251		251
Total Operating Expenses	202,044		43,359
Income from Operations	934,058		135,102
Income Tax Expense	12,423		—
Net Income	921,635		135,102
Retained Earnings(Accumulated Deficit), Beginning of Year	132,665		(10,020		)
Less: Distributions	—		—
Retained Earnings, End of Year	$	1,054,300	$	125,082

See Accompanying Notes to Financial Statements.

PrimaryAds Inc.

Statement of Cash Flows (Unaudited)

Three Months Ended March 31, 2005 and 2004

	2005			2004
Cash Flows from Operating Activities
Net Income	$	921,635		$	135,102
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and Amortization	3,501			3,501
Noncash compensation for equity	—			3,679
Changes in operating assets and liabilities
Accounts Receivable	333,113			(262,510		)
Accounts Payable	(10,184		)	236,410
License fees payable	(14,459		)	7,494
Deferred Revenue	17,579			—
State corporate taxes payable	12,423			(500		)
Total Adjustments	341,973			(11,926		)
Net Cash Provided by Operating Activities	1,263,608			123,176
Net Increase in Cash	1,263,608			123,176
Cash, Beginning of Period	24,883			7,761
Cash, End of Period	$	1,288,491		$	130,937
Noncash Investing and Financing Activities Stockholder loan converted to common stock	$	—		$	9,000

See Accompanying Notes to Financial Statements.

PrimaryAds Inc.

Notes to Financial Statements

March 31, 2005 and 2004

Note A – Summary of Significant Accounting Policies

In the opinion of management, all adjustments necessary to present fairly the financial position, results of operations and cash flows for such periods have been made, and the interim policies followed are in conformity with generally accepted accounting principles and are consistent with those applied for annual periods.  Certain information and note disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted as permitted by the Securities and Exchange Commission.

The preparation of financial statements in conformity with generally accepted accounting principles in the United States 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 revenues and expenses during the reporting period. The Company currently does not have any significant estimates in its financial statements.

Note B – Subsequent Events

On April 22, 2005, the Company was acquired by CGI Holding Corporation for an initial purchase price of $9.95 million.  The shareholders and employees of the Company also received options to purchase an additional 146,000 shares of common stock. The exercise price with respect to 86,000 warrants is $3.57 per share, the closing price of CGI Holding Corporation’s common stock on the trading day immediately prior to the closing of the acquisition. The exercise prices for the remaining 60,000 warrants are based on the closing prices of CGI Holding Corporation’s common stock on the day that is one year prior to the day the warrants vest. The shareholders of the Company may also receive an additional payment of up to $16,000,000 based on the pre-tax earnings of the Company for the first twelve full calendar quarters following the closing. The first $10,000,000 of the earnout payment, to the extent earned, will be paid in shares of CGI Holding Corporation’s common stock. The remainder of the earnout payment, to the extent earned, will be paid 50% in cash and 50% in shares of common stock.

EX-99.3

Exhibit 99.3

Unaudited Combined Pro Forma Financial Data

The following unaudited pro forma combined financial information has been prepared to give effect to the acquisition of PrimaryAds Inc. by CGI Holding Corporation.  The transaction is being accounted for as a purchase business combination.

On April 22, 2005, CGI Holding Corporation completed the acquisition of PrimaryAds Inc. for an initial purchase price of $9.95 million. In addition, acquisition-related closing expenses of approximately $75,000 were incurred.

The acquisition has been accounted for using purchase price accounting in accordance with Financial Accounting Standard No. 141 — Business Combinations. The unaudited pro forma combined statement of financial position as of March 31, 2005 gives effect to the acquisition as if the acquisition had occurred on that date. The unaudited pro forma combined balance sheet includes the balance sheets of CGI Holding Corporation and PrimaryAds Inc. as of March 31, 2005.

The unaudited pro forma combined statements of income for the year ended December 31, 2004 and for the three months ended March 31, 2005 give effect to the acquisition as if the acquisition had occurred on January 1, 2004. The unaudited pro forma combined statements of income presented for the year ended December 31, 2004 and for the three months ended March 31, 2005 include historical financial results of CGI Holding Corporation and PrimaryAds Inc. for the year ended December 31, 2004 and for the three months ended March 31, 2005. Any savings or additional costs, which may be realized through the integration of the operations have not been estimated or included in the unaudited pro forma combined statements of income.

The unaudited pro forma financial information includes the adjustments that have a continuing impact to the combined company to reflect the transaction using purchase accounting. The pro forma adjustments are described in the notes to the unaudited pro forma financial information.  The adjustments are based upon preliminary information and certain management judgments and estimates. The purchase accounting adjustments are subject to revisions, which will be reflected in future periods. Revisions, if any, are not expected to have a material effect on the statement of income or financial position of CGI Holding Corporation.

The unaudited pro forma financial information and accompanying notes are presented for illustrative purposes only and do not purport to be indicative of, and should not be relied upon as indicative of, the financial position or operating results that may occur in the future or that would have occurred if the acquisition had been consummated on January 1, 2004 or March 31, 2005, as applicable. The unaudited pro forma financial information should be read in conjunction with:

(1) CGI Holding Corporation’s consolidated financial statements and notes thereto and management’s discussion and analysis for the year ended December 31, 2004 filed as part of CGI Holding Corporation’s Annual Report on Form 10-KSB

(2) CGI Holding Corporation’s consolidated financial statements and notes thereto and management’s discussion and analysis for the three months ended March 31, 2005 filed as part of CGI Holding Corporation’s Quarterly Report on Form l0-QSB.

(3) PrimaryAds Inc.’s audited financial statements and notes thereto as of and for the years ended December 31, 2004 and 2003, included as Exhibit 99.1 of this Form 8-K/A.

(4) PrimaryAds Inc.’s unaudited financial statements and notes thereto as of March 31, 2005 and for the three months ended March 31, 2005 and 2004, included as Exhibit 99.2 of this Form 8-K/A.

(5) CGI Holding Corporation’s Current Report on Form 8-K previously filed on April 27, 2005.

CGI Holding Corporation

Combined Pro Forma Balance Sheet (Unaudited)

March 31, 2005

	CGI			PrimaryAds		Pro Forma Adjustments		Total
Current Assets
Cash	$	10,664,207		$	1,288,491	(9,950,000	)(1)	$	2,002,698
Restricted Cash	605,002							605,002
Accounts Receivable	3,647,973			865,084				4,513,057
Unbilled Revenue	3,646,931							3,646,931
Allowance for Doubtful accounts	(282,751		)					(282,751		)
Notes Receivable from Related Party	280,175							280,175
Other Current Assets	1,132,114							1,132,114
Deferred Tax Asset	147,840							147,840
Total Current Assets	19,841,491			2,153,575		(9,950,000	)	12,045,066
Net Property and Equipment	1,769,604			1,256				1,770,860
Other Assets
Deferred Tax Asset	724,586							724,586
Intangible Assets (Prior CGI Goodwill - $17,076,173)	22,765,933			21,397		8,957,021	(2)	31,744,351
Other Assets	369,759							369,759
Total Other Assets	23,860,278			21,397				32,838,696
Total Assets	$	45,471,373		$	2,176,228	(1,067,979	)	$	46,654,622
Current Liabilities
Current Portion of long term debt	$	666,509		$	—			$	666,509
Accounts Payable	1,303,065			1,053,260		75,000	(3)	2,431,325
Accrued Income Taxes	788,837			37,410				826,247
Deferred Revenue	1,885,523			17,579				1,903,102
Other Current Liabilities	1,668,334							1,668,334
Total Current Liabilities	6,312,268			1,108,249				7,495,517
Long Term Liabilities	2,202,306			—				2,202,306
Stockholders’ Equity
Preferred Stock	—
Common Stock	35,823			10,000		(10,000	)	35,823
Additional Paid in Capital	37,444,462			3,679		(3,679	)	37,444,462
Retained Earnings	16,514			1,054,300		(1,054,300	)	16,514
Treasury Stock	(540,000		)					(540,000		)
Total Stockholders’ Equity	36,956,799			1,067,979		(1,067,979	)	36,956,799
Total Liabilities and Stockholders’ Equity	$	45,471,373		$	2,176,228	(1,067,979	)	$	46,654,622

See Notes to Unaudited Pro Forma Combined Financial Statements.

CGI Holding Corporation

Combined Pro Forma Statement of Income (Unaudited)

For the Three Months Ended March 31, 2005

	CGI		PrimaryAds		Pro Forma Adjustments			Total
Sales	$	10,179,156	$	5,312,820				$	15,491,976
Cost Of Sales	3,226,144		4,176,718					7,402,862
Gross Profit	6,953,012		1,136,102					8,089,114
Selling, General and Administrative	5,571,754		202,044		$	60,000	(4)	5,833,798
Income from operations	1,381,258		934,058		(60,000		)	2,255,316
Other Income(Expense)	43,562		—					43,562
Income before income tax provision	1,424,820		934,058		(60,000		)	2,298,878
Income Tax Provision	545,230		12,423		362,734		(5)	920,387
Net Income	$	879,590	$	921,635	$	(422,734	)	$	1,378,491
Net Income Per Common Share
Basic								$	0.04
Fully Diluted								$	0.03
Weighted Average Common Shares
Basic								32,672,371
Fully Diluted								39,390,940

See Notes to Unaudited Pro Forma Combined Financial Statements.

CGI Holding Corporation

Combined Pro Forma Statement of Income (Unaudited)

For the Twelve Months Ended December 31, 2004

	CGI		PrimaryAds		Pro Forma Adjustments			Total
Sales	$	21,473,565	$	12,591,072				$	34,064,637
Cost Of Sales	4,057,843		9,426,961					13,484,804
Gross Profit	17,415,722		3,164,111					20,579,833
Selling, General and Administrative	12,691,946		1,246,189		$	240,000	(4)	14,178,135
Income from operations	4,723,776		1,917,922		(240,000		)	6,401,698
Other Income(Expense)	2,423		—					2,423
Income before income tax provision	4,726,199		1,917,922		(240,000		)	6,404,121
Income Tax Provision	1,786,233		25,237		696,338		(5)	2,507,808
Net Income	$	2,939,966	$	1,892,685	($936,338		)	$	3,896,313
Net Income Per Common Share
Basic								$	0.16
Fully Diluted								$	0.13
Weighted Average Common Shares
Basic								24,332,967
Fully Diluted								30,264,304

See Notes to Unaudited Pro Forma Combined Financial Statements.

Notes to Unaudited Pro Forma Combined Financial Information

Note (1) – This adjustment represents the amount of cash paid at closing per the acquisition agreement.

Note (2) – This adjustment represents the intangible assets obtained from the acquisition.  The valuation of the intangibles is currently being performed by an independent valuation firm.

Note (3) – This represents accruals for costs associated with the acquisition.

Note (4) - This adjustment reflects the estimated amount of amortization that would have been recognized from the acquired intangible assets during the period reflected.

Note (5) - This adjustment reflects the estimated combined income tax effect that would have been recognized using applicable state and federal tax rates in effect during the periods presented.