AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION AUGUST 22, 2000

REGISTRATION NO. 333-36312



SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

AMENDMENT NO. 2 TO

FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

ZENGINE, INC.
(Exact name of registrant as specified in its charter)

            DELAWARE                                7373                               31-1638932
(State or other jurisdiction of         (Primary Standard Industrial                (I.R.S. Employer
 incorporation or organization)         Classification Code Number)               Identification No.)


6100 STEWART AVENUE
FREMONT, CALIFORNIA 94538
(510) 651-6400
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)

JOSEPH M. SAVARINO
PRESIDENT AND CHIEF EXECUTIVE OFFICER
ZENGINE, INC.
6100 STEWART AVENUE
FREMONT, CALIFORNIA 94538
(510) 651-6400
(Name, address, including zip code, and telephone number,
including area code, of agent for service)

WITH COPIES TO:

         JEFFREY A. KOEPPEL                                 LARRY A. BARDEN
          KENNETH B. TABACH                                  JON A. BALLIS
ELIAS, MATZ, TIERNAN & HERRICK L.L.P.                       SIDLEY & AUSTIN
        734 15TH STREET, N.W.                               BANK ONE PLAZA
       WASHINGTON, D.C. 20005                           CHICAGO, ILLINOIS 60603
           (202) 347-0300                                   (312) 853-7000
        (202) 347-2172 (FAX)                             (312) 853-7036 (FAX)


APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as

practicable after this Registration Statement becomes effective.

If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. / /

If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. / /

If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. / /

If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. / /

If delivery of the prospectus is expected to be made pursuant to Rule 434, check the following box. / /

CALCULATION OF REGISTRATION FEE

                                                                     PROPOSED
             TITLE OF EACH CLASS OF SECURITIES                  MAXIMUM AGGREGATE           AMOUNT OF
                      TO BE REGISTERED                          OFFERING PRICE(1)        REGISTRATION FEE
Common Stock, no par value..................................       $73,125,000              $19,305(2)

(1) Estimated solely for the purpose of computing the amount of the registration fee pursuant to Rule 457(o) under the Securities Act.

(2) $15,840 of the fee was previously paid and $3,465 is being paid herewith.

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.




SUBJECT TO COMPLETION, DATED AUGUST 22, 2000

THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES, AND WE ARE NOT SOLICITING OFFERS TO BUY THESE SECURITIES, IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.


PROSPECTUS

4,290,000 SHARES

[LOGO]

COMMON STOCK

Zengine, Inc. is offering 4,290,000 shares of its common stock. As part of this offering, we are offering 390,000 shares of our common stock at the initial public offering price to stockholders of MCSi, Inc. (formerly known as Miami Computer Supply Corporation) that owned at least 100 shares of common stock of MCSi as of May 15, 2000. MCSi is our parent company and principal stockholder. MCSi or its designees will purchase any shares of common stock that are not purchased by MCSi stockholders under the MCSi Subscription Program. See the section entitled "Plan of Distribution--MCSi Subscription Program."

This is our initial public offering and no public market currently exists for our shares. We anticipate that the initial public offering price of our shares will be between $13.00 and $15.00 per share. We have applied to list our common stock on the Nasdaq National Market under the symbol "ZNGN."

MCSi is an underwriter with respect to the shares offered to the stockholders of MCSi. MCSi is not an underwriter with respect to any other shares offered and is not included in the term underwriter as used elsewhere in this prospectus.

INVESTING IN OUR COMMON STOCK INVOLVES RISKS. FOR MORE INFORMATION, SEE

"RISK FACTORS" COMMENCING ON PAGE 9.


NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES, OR DETERMINED THAT THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

UNDERWRITTEN PUBLIC OFFERING                                       PER SHARE              TOTAL
Public Offering Price.......................................           $                    $
Underwriting Discount.......................................           $                    $
Proceeds to Zengine.........................................           $                    $

MCSI SUBSCRIPTION PROGRAM                                          PER SHARE              TOTAL
Public Offering Price.......................................           $                    $
Proceeds to Zengine.........................................           $                    $

AGGREGATE OFFERING PROCEEDS                                                               TOTAL
Proceeds to Zengine from Underwritten Public Offering and
  MCSi Subscription Program.................................                                $

The underwriters may also purchase up to an additional 585,000 shares at the public offering price, less the underwriting discount, from us within 30 days from the date of this prospectus to cover over-allotments.


WILLIAM BLAIR & COMPANY
FRIEDMAN BILLINGS RAMSEY

E*OFFERING

MORGAN KEEGAN & COMPANY, INC.

The date of this prospectus is , 2000


[(Graphic--Inside Front Cover--In the upper right hand corner is the Zengine logo consisting of the word "zengine" with gear cogs making up the letter "g". Underneath in a smaller font is the tag line "Fueling Your Brand's Commerce Engine."

Centered in the page is a large circle with three circles inside radiating outward. In the inner-most circle are the words "KORE Platform." The second inside circle is divided into seven segments titled "Product Content," "Merchandising," "Advertising and Sponsorship Management," "Order Management," "Reporting and Analysis," "Inventory Management and Order Fulfillment," and "End-user Customer Service." The third circle has three words surrounding the second inside circle "Platform Hosting" (at the top), "Design" (on the right side) and "Integration" (on the left side).

Under the graphic is the following text:

"ZENGINE PROVIDES A COMPLETE SOLUTION

Zengine's comprehensive suite of technology-based solutions enable businesses to quickly and cost-effectively create, maintain and enhance large scale business-to-business (B2B) and business-to-consumer (B2C) e-commerce platforms on an outsourced basis. Zengine's competitive advantage comes from its ability to deliver a full range of integrated services from one technology platform--a platform that enables streamlined integration, rapid deployment and simplified ongoing development.

THE KORE ENGINE

Zengine's proprietary technology platform, the KORE Engine, enables us to build, deliver and manage e-commerce solutions in less time and more cost effectively than existing alternatives. The functional components of KORE are stored on a centralized server array which services all Zengine clients. This architecture minimizes development costs and reduces time-to-market because we are able to leverage existing functionality previously developed within KORE rather than re-engineering the functionality for each application. Upon completion, the component or feature can be made available to other Zengine clients without added development time or cost."

Under the text are two horizontal lists of Zengine's clients. The top list is as follows: the drDrew.com logo, EPSON, everdream, Gyration and its logo, Hear Me and its logo, Hewlett Packard and its logo, Hitachi and its logo, and Imation. The bottom list of Zengine's clients are: NER, the On Site Graphics logo, the People's Tour logo, PLUS Corporation, Presentation Pro, Proxima and rexstores.com. Under this line is a solid delta pointing to the list followed by the word "Clients."]


TABLE OF CONTENTS

                                                                PAGE
                                                              --------
Prospectus Summary..........................................    4

Risk Factors................................................    9

Use of Proceeds.............................................    21

Dividend Policy.............................................    21

Capitalization..............................................    22

Dilution....................................................    23

Selected Financial Data.....................................    24

Management's Discussion and Analysis of Financial Condition
  and Results of Operations.................................    26

Business....................................................    32

Management..................................................    50

Certain Transactions........................................    57

Principal Stockholders......................................    60

Description of Capital Stock................................    61

Shares Eligible for Future Sale.............................    65

Plan of Distribution........................................    66

Legal Matters...............................................    69

Experts.....................................................    69

Additional Information......................................    69

Index to Financial Statements...............................   F-1

Appendix: "Meet the Management" Presentation................   A-1

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PROSPECTUS SUMMARY

THIS SUMMARY HIGHLIGHTS INFORMATION CONTAINED ELSEWHERE IN THIS PROSPECTUS. HOWEVER, IT DOES NOT CONTAIN ALL OF THE INFORMATION THAT YOU SHOULD CONSIDER BEFORE INVESTING IN OUR COMMON STOCK. YOU SHOULD READ THE ENTIRE PROSPECTUS CAREFULLY, INCLUDING THE INFORMATION UNDER "RISK FACTORS" BEGINNING ON PAGE 9, AND THE FINANCIAL STATEMENTS BEGINNING ON PAGE F-1, BEFORE MAKING AN INVESTMENT DECISION.

ZENGINE, INC.

Zengine provides a comprehensive suite of technology-based solutions that enable businesses to conduct electronic commerce. We offer a full range of integrated services for both business-to-business, or B2B, and business-to-consumer, or B2C, e-commerce including Web site user interface design, product content and merchandising, personalization and customer relationship management, advertising and sponsorship management, order management, inventory management and order fulfillment, end-user customer service and reporting and analysis. We provide our services as a complete, or "turn-key," package or as component features. We believe our solution allows our clients to achieve rapid deployment of e-commerce platforms, results in greater economies of scale and provides cost-effective, ongoing access to leading edge e-commerce technology. We market our services to businesses seeking to initiate, expand or enhance their ability to conduct e-commerce. Our solutions are delivered on an outsourced basis, which means we produce and operate our client's e-commerce Web sites under their brand. This allows our clients to quickly and cost-effectively create, maintain and enhance their e-commerce presence.

Our proprietary technology and infrastructure, the KORE Engine, enables us to build, deliver and manage e-commerce solutions in less time and more cost effectively than existing alternatives. The functional components of KORE are stored on a centralized server array which services all of our e-commerce clients. This architecture minimizes development costs and reduces time to market because we are able to leverage existing functionality previously developed within KORE rather than re-engineering the functionality for each application. Upon completion, the component or feature can be made available to other Zengine clients without added development time or cost. In addition, the KORE Engine is built to be highly-scalable, permitting our clients to deliver consistent quality of service as transaction volumes increase, enabling the rapid deployment of high-speed, dynamic e-commerce Web sites. The real-time personalization technology proprietary to KORE allows businesses to manage online customer relationships and personalize communication with their customers and trading partners.

Widespread acceptance of the Internet has opened tremendous opportunities for companies seeking growth and increased efficiencies through B2B and B2C e-commerce. Although companies are eager to take advantage of these opportunities, many may lack the internal resources that the analysis, design and implementation of an effective Internet solution requires. It is often very inefficient, expensive and time-consuming for companies to develop and staff their own e-commerce solutions or to purchase currently available application software packages that require sophisticated integration and maintenance. As a result, companies increasingly seek to outsource these services. We believe our ability to offer a full range of integrated e-commerce services demanded by clients on a turn-key and outsourced basis provides us a competitive advantage in today's marketplace.

We actively market our services through a direct sales force to businesses seeking to initiate, expand or enhance their ability to conduct e-commerce, including:

- original equipment manufacturers;

- wholesalers, distributors and other businesses that create customized vendor and supply chain relationships over the Internet or a secure extranet, a computer network used to communicate business related information to a particular vendor, distributor or customer;

- bricks and mortar retailers;

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- online-only retailers; and

- Web sites that have a large and loyal user base (including portals, pure content sites, communities, directories and service providers).

We plan to continue to pursue these target clients and to penetrate other markets through indirect distribution channels such as consulting firms, systems integrators, advertising firms, and other professional services firms.

After the commercial introduction of the Zengine service, we have successfully launched our client's e-commerce platforms within an average of 40 days after engagement compared to industry ranges of several months to over one year. We currently have 15 e-commerce clients, including, drDrew.com, Everdream, Gyration, KaBloom, MCSi, PresentationPro, rexstores.com, Sharp Electronics, Work.com, a joint venture between Excite@Home and Dow Jones & Co., and Universal Studios. We also sell advertising and sponsorship packages through our clients' Web sites primarily to original equipment manufacturers whose products are featured in our client's online stores. We have placed advertisements for 16 companies, including Epson, Hewlett-Packard, Hitachi, InFocus, Lexmark, Maxell, Proxima, Sharp, Sony and Toshiba.

Our revenue is generated through a combination of one or more of the following: initial set-up and integration fees, subscription fees, transaction fees and advertising and sponsorship fees through our clients' Web sites.

We intend to grow our business by pursuing five key strategies:

- target companies seeking to initiate, expand or enhance their ability to conduct e-commerce;

- extend the capabilities of our KORE Engine;

- leverage our client base;

- expand our strategic alliances; and

- assist our clients in increasing their revenues using our state-of-the-art e-commerce solutions.

OUR RELATIONSHIP WITH MCSI

We are a subsidiary of MCSi, Inc., a systems integrator of state-of-the-art presentation and broadcast facilities throughout the United States, Canada and certain foreign countries. MCSi offers design-build and engineering, computer networking and configuration services, an extensive product line and technical support to the converging audio-visual systems, broadcast media and computer technology industries. MCSi's common stock is traded on the Nasdaq National Market under the symbol "MCSI." After the completion of this offering, MCSi will own approximately 50.7% of the outstanding shares of our common stock, or approximately 48.9% if the underwriters exercise their over-allotment option in full.

In addition to the MCSi Subscription Program, MCSi has advised us that it intends to evaluate, from time to time, alternatives to maximize, for the benefit of MCSi's stockholders, the value of its Zengine ownership. These alternatives could include retention of all or a portion of MCSi's shareholdings, the sale in one or more transactions of all or a portion of MCSi's shareholdings, the distribution of MCSi's shareholdings to MCSi shareholders (which might be achieved through a tax free spin-off under
Section 355 of the Internal Revenue Code), the issuance of debt or equity securities that enable MCSi to monetize all or a portion of its investment in Zengine or other transactions. We cannot assure you as to which alternative MCSi may choose, or which may be achievable, or whether or when any such transaction will occur.

We have entered into a number of agreements with MCSi relating to our business. Under these agreements, MCSi will continue to provide us with certain administrative, product fulfillment and customer support services and facilities, and we will provide MCSi with e-commerce services for its

5

computer products and accessories and audio-visual products business. For more information, please see "Risk Factors--Risks Related to Our Relationship With MCSi" and "Certain Transactions."


We were incorporated in Delaware in March 1999. Our principal executive offices are located at 6100 Stewart Avenue, Fremont, California 94538, and our telephone number is (510) 651-6400.

We maintain a Web site at www.zengine.com, and MCSi maintains a Web site at www.mcsinet.com. Information contained on these as well as other Web sites referred to herein do not constitute part of this prospectus and are not incorporated by reference in this prospectus.

Unless otherwise indicated, all references to "Zengine," "we," "us" and "our" refer to Zengine, Inc., a Delaware corporation.

THE OFFERING

Shares offered by Zengine............  4,290,000

Shares outstanding after the
  offering...........................  16,473,480

Shares reserved for issuance with
  respect to outstanding options and
  a warrant..........................  1,660,167

Use of proceeds......................  For general corporate purposes, including working capital,
                                       sales and marketing activities, development of our service
                                       offerings, capital expenditures and potential investments or
                                       acquisitions in order to execute our key strategies. Please
                                       see "Use of Proceeds."

Nasdaq National Market symbol........  "ZNGN"

Unless otherwise noted, the information in this prospectus assumes the underwriters do not exercise their option to purchase an additional 585,000 shares of common stock from us to cover over-allotments. The number of outstanding shares used in this prospectus is 12,183,480 and excludes:

- 1,380,118 shares of common stock issuable upon exercise of outstanding options at a weighted average exercise price of $0.89;

- 2,004,182 shares of common stock available for the future grant of stock options under our stock option plan; and

- 280,049 shares of common stock issuable upon the exercise of a warrant to be issued on the date of the initial public offering at an exercise price per share equal to the initial public offering price.

MCSi SUBSCRIPTION PROGRAM

As part of this offering, we are offering shares of our common stock at the initial public offering price to stockholders of MCSi that owned at least 100 shares of MCSi common stock on May 15, 2000 in the MCSi Subscription Program. MCSi stockholders may subscribe for one share of common stock for every 30 shares of MCSi common stock held by them. The program is described in greater detail in the section of this prospectus entitled "Plan of Distribution--MCSi Subscription Program."


All information in this prospectus relating to the number of shares of our common stock, options or warrants, unless otherwise noted, is based upon information as of June 30, 2000, assuming that the amended and restated Certificate of Incorporation has been filed to increase the authorized common stock to 100,000,000 shares, a 6.7686 to one stock split before the offering and that the MCSi Subscription Program is fully subscribed by MCSi stockholders.

6

SUMMARY FINANCIAL INFORMATION

The summary financial information set forth below for the period from inception (January 1, 1999) to September 30, 1999 and the six months ended March 31, 2000, has been derived from our financial statements which have been audited by PricewaterhouseCoopers LLP, independent accountants, whose report is included elsewhere in this prospectus. The unaudited interim financial data for the three and nine month periods ended June 30, 2000 has been derived from our unaudited interim financial statements, which in the opinion of management, includes all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation thereof. The summary financial information set forth below should be read in conjunction with "Management's Discussion and Analysis of Financial Condition and Results of Operations," and our financial statements and the accompanying notes thereto included elsewhere in this prospectus.

                                    PERIOD FROM
                                     INCEPTION          SIX MONTHS ENDED
                                (JANUARY 1, 1999) TO       MARCH 31,       THREE MONTHS ENDED   NINE MONTHS ENDED
                               SEPTEMBER 30, 1999(1)        2000(1)         JUNE 30, 2000(1)    JUNE 30, 2000(1)
                               ----------------------   ----------------   ------------------   -----------------
RESULTS OF OPERATIONS DATA:
Revenue
    Third party..............        $    4,089            $1,354,088          $1,295,077          $2,649,165
    Related Party............                --             1,356,828           1,098,293           2,455,121
                                     ----------            ----------          ----------          ----------
                                          4,089             2,710,916           2,393,370           5,104,286
                                     ----------            ----------          ----------          ----------
Cost of revenue
    Third party..............            23,511               231,752             203,791             435,543
    Related party............                --                55,253              24,000              79,253
                                     ----------            ----------          ----------          ----------
                                         23,511               287,005             227,791             514,796
                                     ----------            ----------          ----------          ----------
Gross profit (loss)..........           (19,422)            2,423,911           2,165,579           4,589,490
                                     ----------            ----------          ----------          ----------
Selling, general and
  administrative expenses(2)
    Third party..............           401,081             1,897,202           1,663,253           3,560,455
    Related party............           513,120               435,000             794,251           1,229,251
                                     ----------            ----------          ----------          ----------
                                        914,201             2,332,202           2,457,504           4,789,706
                                     ----------            ----------          ----------          ----------
Income (loss) from
  operations.................          (933,623)               91,709            (291,925)           (200,216)
Interest income..............                --                81,464              42,291             123,755
                                     ----------            ----------          ----------          ----------
Income (loss) before income
  taxes......................          (933,623)              173,173            (249,634)            (76,461)
Provision for income taxes...                --                    --                  --                  --
                                     ----------            ----------          ----------          ----------
Net income (loss)............        $ (933,623)           $  173,173          $ (249,634)         $  (76,461)
                                     ==========            ==========          ==========          ==========
Earnings (loss) per share of
  common stock--basic........        $     (.08)           $      .02          $     (.02)         $     (.01)
                                     ==========            ==========          ==========          ==========
Earnings (loss) per share of
  common stock-diluted.......        $     (.08)           $      .01          $     (.02)         $     (.01)
                                     ==========            ==========          ==========          ==========
Weighted average number of
  common shares
  outstanding--basic.........        11,377,184            11,091,515          11,196,537          11,143,051
                                     ==========            ==========          ==========          ==========
Weighted average number of
  common shares
  outstanding-diluted........        11,377,184            13,338,169          11,196,537          11,143,051
                                     ==========            ==========          ==========          ==========

                                                                    AT
                                                              SEPTEMBER 30,           AT
                                                                 1999(1)       JUNE 30, 2000(1)
                                                              --------------   ----------------
BALANCE SHEET DATA:
Working capital (deficit)...................................     $(92,167)        $3,549,790
Total assets................................................     $355,320         $5,447,043
Long-term debt..............................................           --                 --
Total debt..................................................           --                 --
Stockholders' equity........................................     $262,747         $4,287,091

7


Notes:

(1) The data reflects selected results of operations and balance sheet data from the period from our inception (January 1, 1999) through September 30, 1999, for the six month period ended March 31, 2000, for the three month period ended June 30, 2000 and for the nine month period ended June 30, 2000. Because our inception was on January 1, 1999, comparable data for the six month period ended March 31, 1999 and for the nine month period ended June 30, 2000 is not available. For all periods presented, revenue, cost of revenue and selling, general and administrative expenses include related party transactions with MCSi. See Note 4 to our financial statements included elsewhere in this prospectus.

(2) Selling, general and administrative expenses for the nine month period ended September 30, 1999, for the six month period ended March 31, 2000, for the three month period ended June 30, 2000 and for the nine month period ended June 30, 2000 include $89,483, $113,173, $116,583 and $229,756, respectively, of non-cash compensation expense. See Note 7 to our financial statements included elsewhere in this prospectus.

8

RISK FACTORS

YOU SHOULD CAREFULLY CONSIDER THE RISKS DESCRIBED BELOW BEFORE YOU DECIDE TO BUY OUR COMMON STOCK. IF ANY OF THE FOLLOWING RISKS ACTUALLY OCCUR, OUR BUSINESS, FINANCIAL CONDITION OR RESULTS OF OPERATIONS WOULD LIKELY SUFFER. IN THIS CASE, THE TRADING PRICE OF OUR COMMON STOCK COULD FALL, AND YOU MAY LOSE ALL OR PART OF THE MONEY YOU PAID TO BUY OUR COMMON STOCK.

THIS PROSPECTUS ALSO CONTAINS FORWARD-LOOKING STATEMENTS THAT INVOLVE SUBSTANTIAL RISKS AND UNCERTAINTIES. OUR ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS COULD DIFFER SUBSTANTIALLY FROM THOSE EXPRESSED IN OR IMPLIED BY THESE FORWARD-LOOKING STATEMENTS AS A RESULT OF SEVERAL FACTORS, INCLUDING THE RISKS WE FACE, AS MORE FULLY DESCRIBED BELOW IN THIS SECTION AND ELSEWHERE IN THIS PROSPECTUS.

RISKS RELATED TO OUR BUSINESS

WE HAVE A LIMITED OPERATING HISTORY.      We commenced operations in January 1999 as a division of MCSi and
                                          since our incorporation in March 1999, we have operated as a
                                          subsidiary of MCSi. Our business and the services we offer are in the
                                          early stages of development. To date, 15 companies have purchased our
                                          e-commerce services and we have placed advertisements for 16
                                          companies. Accordingly, we have a very limited operating history, and
                                          our business and prospects must be considered in light of the risks
                                          and uncertainties facing early-stage companies in rapidly evolving
                                          markets such as e-commerce.

WE HAVE A HISTORY OF LOSSES, EXPECT       We are not profitable and cannot be certain that we will generate
FUTURE LOSSES AND CANNOT ASSURE YOU THAT  sufficient revenue to ever become profitable. We have incurred net
WE WILL ACHIEVE PROFITABILITY.            losses since our inception. To the extent such losses continue, our
                                          accumulated deficit will increase and our stockholders' equity will
                                          decrease. We incurred net losses of $934,000 for the period from
                                          inception (January 1, 1999) to September 30, 1999, and net losses of
                                          $76,000 for the nine months ended June 30, 2000. We anticipate that we
                                          will substantially increase our marketing, technology and
                                          infrastructure, software development and general and administrative
                                          expenses in fiscal 2000 and, as a result, we expect to incur
                                          additional losses for the foreseeable future. In addition, our limited
                                          operating history makes prediction of future results difficult and,
                                          accordingly, we may not achieve or sustain profitability.

THE EXPECTED FLUCTUATIONS OF OUR          As a result of our limited operating history, we do not have
QUARTERLY RESULTS COULD CAUSE OUR STOCK   meaningful historical financial data for quarterly periods on which to
PRICE TO FLUCTUATE OR DECLINE.            base planned operations. Our expense levels are based in part on our
                                          personnel and software development requirements as well as our
                                          expectations as to future revenues. We anticipate that our operating
                                          expenses will increase substantially for the foreseeable future as we
                                          continue to extend the capabilities of our KORE Engine, increase our
                                          sales and marketing activities and broaden our customer support
                                          capabilities.

                                          We expect to experience significant fluctuations in future quarterly
                                          operating results. These fluctuations may be caused by many factors
                                          including, among others:

                                          - cancellation of orders prior to full deployment;

9

                                          - nonrenewal of service agreements;

                                          - changes in our business strategy; and

                                          - changes in key personnel.

                                          We anticipate that, for the foreseeable future, a significant portion
                                          of our revenues will be derived from a limited number of clients
                                          (including MCSi), and the timing of receipt and fulfillment of any
                                          such orders is expected to cause material fluctuations in our
                                          operating results, particularly on a quarterly basis. In addition, in
                                          the near term, we intend to increase significantly our personnel,
                                          including our software engineers, direct sales and marketing
                                          personnel. The timing of such expansion and the rate at which new
                                          engineers and sales people become productive could also cause material
                                          fluctuations in our quarterly operating results.

                                          Due to the foregoing factors, quarterly revenues and operating results
                                          are difficult to forecast, and we believe that period-to-period
                                          comparisons of our operating results will not necessarily be
                                          meaningful and should not be relied upon as any indication of future
                                          performance. It is likely that our future quarterly operating results
                                          from time to time will not meet the expectations of market analysts or
                                          investors, which may have an adverse effect on the price of our common
                                          stock.

OUR LENGTHY SALES CYCLE MAY CAUSE         The sales cycle for our services is long, typically ranging two months
OPERATING RESULTS TO VARY SIGNIFICANTLY   or more. Our agreements with our clients generally require a
FROM PERIOD TO PERIOD.                    substantial set up fee, and often are part of an important strategic
                                          decision by our clients regarding their information systems
                                          infrastructure. Accordingly, the decision to purchase our services
                                          typically requires significant pre-purchase evaluation. We spend
                                          substantial time educating and providing information to prospective
                                          clients regarding the use and benefits of our services. During this
                                          evaluation period, we may expend substantial funds in sales, marketing
                                          and management efforts. This lengthy sales cycle may cause operating
                                          results to vary significantly from period to period.

IF WE EXPERIENCE DELAYS IN THE LAUNCH OF  It often takes time and resources to implement and to integrate our
A WEB SITE OR IN THE SATISFACTION OF      solution with our clients' existing computer systems. Where our
CONTRACT TERMS, WE MAY HAVE TO DEFER      services require that we launch a clients' Web site, we will not
REVENUE UNTIL LATER QUARTERS, CAUSING     recognize any revenue until we have launched our client's e-commerce
OUR QUARTERLY RESULTS TO FLUCTUATE.       Web site. If we experience delays in the progress on a previously
                                          announced project or in the satisfaction of contract terms required
                                          for revenue recognition in a particular quarter, we may not be able to
                                          recognize revenue until a later period, causing our quarterly results
                                          to fluctuate. This could cause our stock price to decline.

BECAUSE A SMALL NUMBER OF CLIENTS WILL    We currently have 15 e-commerce clients and 16 advertising and
ACCOUNT FOR A SUBSTANTIAL PORTION OF OUR  sponsorship clients. We expect that a limited number of clients will
REVENUE, OUR REVENUE COULD DECLINE        continue to account for a substantial portion of our revenue for the
SIGNIFICANTLY IF WE LOSE A MAJOR CLIENT.  foreseeable future. As a result, if we lose a major client or if a
                                          contract is delayed, canceled or deferred, our revenue and operating
                                          results would be adversely affected.

10

OUR REVENUE IS DEPENDENT UPON OUR         Our revenue is based, in part, on transaction fees and will fluctuate
CLIENTS' BUSINESS AND PRODUCT SALES.      with the volume of product sales by our clients. We do not have direct
                                          control over the success of our client's e-commerce sites. If we
                                          dedicate significant resources to a client whose business does not
                                          generate substantial transactions or whose products do not generate
                                          substantial customer sales, our business may suffer.

WE EXPECT THAT A SUBSTANTIAL PORTION OF   We currently expect that advertising and sponsorship fees will account
OUR REVENUE FOR THE CURRENT FISCAL YEAR   for a substantial portion of our total revenue in the current fiscal
WILL BE DERIVED FROM SHORT-TERM           year. The arrangements under which we receive these fees typically are
ADVERTISING AND SPONSORSHIP               of a limited duration. Accordingly, our revenue from advertising and
ARRANGEMENTS.                             sponsorship fees may not be sustained over the longer term.

PERSONALIZATION MAY NOT BE SUCCESSFUL IN  The centerpiece of our service offering to our clients is the high
GENERATING ADDITIONAL REVENUE FOR OUR     degree of advanced personalization generated by the KORE Engine. Our
CLIENTS.                                  sales proposition to our clients is that the personalization of the
                                          shopping experience results in a higher user conversion ratio (i.e.,
                                          the number of Web site visitors who actually purchase), increased
                                          purchases per visit, increased purchase size and greater customer
                                          loyalty. If our sales proposition turns out to be ineffective for one
                                          or more of our clients, we could lose that business, and possibly
                                          future business, which would result in a material adverse effect on
                                          our results of operations.

IF WE LOSE KEY PERSONNEL OR ARE UNABLE    We believe our future success will depend upon our ability to retain
TO ATTRACT AND RETAIN ADDITIONAL          our key management personnel, including Joseph Savarino, our President
QUALIFIED PERSONNEL WE MAY NOT BE ABLE    and Chief Executive Officer, Lalit Dhadphale, our Vice President of
TO SUCCESSFULLY MANAGE OUR BUSINESS AND   Product Development and Chief Operating Officer, and Christopher
ACHIEVE OUR OBJECTIVES.                   Feaver, our Vice President and Chief Technology Officer, because of
                                          their experience and knowledge regarding the development,
                                          opportunities and challenges of our business. Each of these executives
                                          is subject to a three year employment agreement which is terminable at
                                          will by them. We may not be successful in attracting and retaining
                                          other key employees in the future.

                                          We expect to add additional key personnel in the near future,
                                          including software engineers and direct sales and marketing personnel.
                                          During the next twelve months, we anticipate that our employee related
                                          costs will increase approximately $4.5 million over current levels.
                                          Our future success and our ability to expand our operations will also
                                          depend in large part on our ability to attract and retain additional
                                          qualified technical personnel, as well as marketing and sales
                                          personnel. Competition for these types of employees is intense due to
                                          the limited number of qualified professionals, particularly in the San
                                          Francisco Bay area of California.

DIFFICULTIES WE MAY ENCOUNTER MANAGING    We have rapidly expanded our operations and anticipate that further
OUR GROWTH COULD ADVERSELY AFFECT OUR     significant expansion will be required to address potential growth in
RESULTS OF OPERATIONS.                    our client base and market opportunities. Our expansion is placing a
                                          significant strain on our managerial and operational resources. Due to
                                          our limited operating history, our staff has not

11

                                          worked together for a significant period of time. A number of key
                                          managerial, technical and operations personnel are relatively new to
                                          our company. In addition, none of our executive officers have ever
                                          managed a public corporation.

IF WE ARE UNABLE TO ESTABLISH AND         Our business strategy is dependent upon increasing the sales of our
MAINTAIN RELATIONSHIPS WITH COMPANIES     services to companies that desire to establish or enhance their
WHO ARE ENGAGING IN, OR INTEND TO ENGAGE  e-commerce efforts. We have entered into service agreements with
IN, E-COMMERCE, OUR BUSINESS WILL NOT     companies that have embraced the Internet as a significant
GROW.                                     distribution channel. We do not know if we will be successful in
                                          establishing or maintaining relationships with companies in our target
                                          market. If we are unable to do so, we will likely be unable to
                                          continue to grow our business or establish a meaningful market share.

OUR SYSTEMS MAY NOT ACCOMMODATE           Our success depends on our ability to handle a large number of
SIGNIFICANT GROWTH IN THE NUMBER OF OUR   transactions for many different clients in various product categories.
CLIENTS.                                  We expect that the volume of transactions we process will increase
                                          significantly as we expand our operations. If this occurs, additional
                                          stress will be placed upon the network hardware and software that
                                          manages our operations. We may not be able to efficiently manage a
                                          large number of transactions. If we are not able to maintain an
                                          appropriate level of operating performance, our reputation and
                                          business would be harmed.

SOFTWARE DEFECTS AND SYSTEM ERRORS COULD  Our services are based on complex proprietary software which could
DIMINISH DEMAND FOR OUR SERVICES AND      contain undetected errors or defects. We may, in the future, discover
RESULT IN LOSS OF REVENUE, DELAY IN       software errors and as a result experience delays in providing the
MARKET ACCEPTANCE AND INJURY TO OUR       services we agreed to provide during the period required to correct
REPUTATION.                               these errors. Errors may be found from time to time in our new or
                                          enhanced service offerings after launch of our client's e-commerce
                                          store, resulting in:

                                          - loss of revenue;

                                          - delay in market acceptance and sales;

                                          - diversion of development resources;

                                          - injury to our reputation; or

                                          - increased remediation costs.

                                          In addition, our service is generally used in systems with the
                                          client's or other vendors' software, and as a result, our software
                                          must integrate successfully with these existing systems. System
                                          errors, whether caused by our software, the client's or those of
                                          another vendor, could adversely affect the market acceptance of our
                                          services and any necessary revisions could cause us to incur
                                          significant expenses.

IF WE BECOME SUBJECT TO PRODUCT           Since our services typically operate our client's only e-commerce Web
LIABILITY LITIGATION, IT COULD BE COSTLY  site, any performance problems with our services, whether as a result
AND TIME CONSUMING TO DEFEND.             of internal or vendor errors, defects or otherwise, could severely
                                          impact our clients' product sales. This could result in financial or
                                          other damages to our clients, who could sue us. Product

12

                                          liability litigation, even if it were unsuccessful, would be time
                                          consuming and costly to defend.

IF WE ARE UNABLE TO SECURE ADDITIONAL     Because we anticipate net losses for the foreseeable future, it is
FINANCING, WE MAY BE UNABLE TO CONTINUE   possible that we will require additional funds to grow our business.
TO GROW OUR BUSINESS.                     If we are not able to secure additional funds when needed, we may not
                                          be able to cover our operating expenses or pursue our other business
                                          strategies. In such an event, our business could be significantly
                                          harmed.

IF WE ARE UNABLE TO ADEQUATELY PROTECT    We have applied for trademarks on our marks, such as the Zengine name,
OUR TRADEMARKS OR BRAND IDENTITY, OUR     the Zengine "gear" logo, "KORE," "KOG" and our tag line "Fueling Your
SALES GROWTH COULD DECREASE.              Brand's Commerce Engine." Effective trademark protection may not be
                                          available for our marks. We have identified another company that is
                                          utilizing the KORE name. We have demanded that this company stop using
                                          our proprietary name. It is possible that others will adopt product
                                          names or logos similar to KORE or the Zengine gear logo. This would
                                          impede our ability to build our brand identity, lead to customer
                                          confusion, increase our legal expenses and distract management from
                                          the operation of our business. Such events could result in a loss of
                                          significant rights, increased expenses and lower sales of our
                                          services.

                             RISKS RELATED TO THE INTERNET AND E-COMMERCE INDUSTRY

THE MARKET FOR OUR SERVICES IS IN THE     Our services facilitate e-commerce over public and private data
EARLY STAGE OF DEVELOPMENT.               networks. The market for our services is at an early stage of
                                          development and is rapidly evolving. As is typical for new and rapidly
                                          evolving industries, demand and market acceptance for recently
                                          introduced products and services are subject to a high level of
                                          uncertainty.

PRIVACY CONCERNS MAY LIMIT INTERNET USE   One of the principal features of our proprietary technology is the
AND USE OF OUR SERVICES.                  ability to develop and maintain highly personalized profiles of users
                                          to assist our clients in determining the nature of the content and the
                                          product offerings to be provided to that customer. Typically, these
                                          profiles are captured when customers visit a site on the Web and
                                          volunteer information in response to survey questions concerning their
                                          backgrounds, interests, and preferences. Profiles are augmented over
                                          time through the collection of usage data. Privacy concerns may
                                          nevertheless cause users to resist providing the personal data
                                          necessary to support this profiling capability. The perception by our
                                          clients' customers or potential customers of substantial security and
                                          privacy concerns, whether or not valid, may inhibit market acceptance
                                          of our technology. Such concerns also may be heightened by legislative
                                          or regulatory requirements that require notification to Web site users
                                          that the data captured as a result of visitation of certain Web sites
                                          may be used by marketing entities to unilaterally address product
                                          promotion and advertising to that user. While we are not aware of any
                                          such legislation or regulatory requirements currently in effect in the
                                          United States,

13

                                          certain other countries and political entities, such as the European
                                          Community, have adopted such legislation or regulatory requirements.
                                          Similar legislation or regulatory requirements may be adopted in the
                                          United States in the future.

                                          Certain consumer activist groups have recently sought to have the
                                          Federal Trade Commission determine whether profiling should be
                                          considered "subliminal" marketing which they believe should be
                                          prohibited. While we are not aware of any law or regulation which
                                          prohibits subliminal marketing, the FTC has, in the past, considered
                                          such acts to be deceptive trade practices and has issued
                                          administrative cease and desist orders against companies using those
                                          techniques. The FTC has recently begun an informal inquiry into the
                                          business practices of an Internet marketing and advertising company
                                          that uses personalization techniques to target advertisements to
                                          people who browse certain Web sites. That company is also currently
                                          defending itself against seven private lawsuits alleging, among other
                                          things, the improper collection and use of personal information in
                                          violation of federal and state statutes and the right of privacy. In
                                          addition, the Attorney General's Office of the States of New York and
                                          Michigan have requested that this company provide certain information
                                          concerning its business practices. Zengine is not involved in any
                                          similar investigation or litigation. However, if the privacy concerns
                                          of consumers are not adequately addressed, our business could be
                                          harmed. For more information regarding the personalization features of
                                          our technology, please see "Business--Technology."

A BREACH OF OUR E-COMMERCE SECURITY       A requirement of the continued growth of e-commerce is the secure
MEASURES COULD REDUCE DEMAND FOR OUR      transmission of confidential information over public networks. We
SERVICES.                                 utilize a third party payment processor for a portion of the
                                          transactions we handle. Both the third party processor and we rely on
                                          public key cryptography. This is an encryption method that utilizes
                                          two keys, a public and a private key, for encoding and decoding data,
                                          and digital certificate technology, or identity verification, to
                                          provide the security and authentication necessary for secure
                                          transmission of confidential information. Regulatory and export
                                          restrictions may prohibit us from using the strongest and most secure
                                          cryptographic protection available and thereby expose us to a risk of
                                          data interception. A party who is able to circumvent our security
                                          measures could misappropriate proprietary information or interrupt our
                                          operations. Any compromise or elimination of our security could harm
                                          our reputation and reduce demand for our services. We currently carry
                                          no insurance to specifically protect us against this risk.

THE INTENSE COMPETITION IN OUR INDUSTRY   The market for our services is intensely competitive and subject to
COULD REDUCE OR ELIMINATE THE DEMAND FOR  rapid technological change. We expect competition to intensify in the
OUR SERVICES.                             future. Our primary source of competition comes from e- commerce
                                          retailers who develop their own custom systems or engage consultants
                                          who install packaged software systems. Online retailers who have made
                                          large investments to develop custom

14

                                          systems may be less likely to adopt an outsourced transaction
                                          processing strategy. We also face competition from companies such as
                                          Art Technology Group, Breakaway Solutions, Broadvision, E.piphany, Net
                                          Perceptions and USinternetworking. In addition, other companies may
                                          enter the market for our services. In the future, we may also compete
                                          with large companies that derive a significant portion of their
                                          revenues from e-commerce and may offer, or provide a means for others
                                          to offer, e-commerce transaction services.

                                          Many of our competitors have longer operating histories, substantially
                                          greater financial, technical, marketing or other resources, or greater
                                          name recognition than we do. Our competitors may be able to respond
                                          more quickly than we can to new or emerging technologies and changes
                                          in customer requirements. Competition could impede our ability to sell
                                          additional services on terms favorable to us. Our current and
                                          potential competitors may develop and market new technologies that
                                          render our existing or future services obsolete, unmarketable or less
                                          competitive. Our success will depend, in part, on our ability to
                                          internally develop and license leading technologies to enhance our
                                          existing services, develop new services and technology that address
                                          the increasingly sophisticated and varied needs of our clients, and
                                          respond to technological advances and emerging industry standards and
                                          practices on a cost-effective and timely basis. Our current and
                                          potential competitors may make strategic acquisitions or establish
                                          cooperative relationships among themselves or with other solution
                                          providers, thereby increasing the ability of their services or
                                          products to address the needs of our prospective clients. Our current
                                          and potential competitors may establish or strengthen cooperative
                                          relationships with our current or future channel partners, thereby
                                          limiting our ability to sell services through these channels.

THE RISK OF LACK OF CAPACITY, SYSTEM      We provide a comprehensive, highly personalized e-commerce service to
FAILURE AND SYSTEM DEVELOPMENT RISKS      companies seeking to capitalize on the ability to sell directly to
COULD RESULT IN DOWNTIME WITH A           their customers using our proprietary technology. The satisfactory
SIGNIFICANT LOSS OF REVENUE.              performance, reliability and availability of our proprietary
                                          technology and its underlying software and network infrastructure are
                                          critical to our operations, level of customer service, and reputation
                                          and ability to attract and retain clients. Our systems and operations
                                          are vulnerable to damage or interruption from earthquake, fire, flood
                                          and other natural disasters; and power loss, telecommunications or
                                          data network failure, operator negligence, improper operation by
                                          employees, and similar events.

15

                                          We presently do not carry sufficient business interruption insurance
                                          to fully compensate us for losses that may occur. Despite the use of
                                          network security devices, our servers are vulnerable to computer
                                          viruses, physical or electronic break-ins and similar disruptions,
                                          which could lead to interruptions, delays, loss of data or the
                                          inability to accept and fulfill end-user orders. Any systems
                                          interruption that impairs our ability to serve our client's Web pages,
                                          accept and fill customer orders or to provide customer service reduces
                                          the attractiveness of our offerings, which could materially adversely
                                          affect our business, financial condition and results of operations.

WE HAVE NO PATENT ON THE KORE ENGINE AND  Our success and ability to compete depends to a large degree upon our
WE MAY NOT BE ABLE TO ADEQUATELY PROTECT  proprietary technology. We rely on a combination of trademark and
OUR PROPRIETARY TECHNOLOGY RIGHTS.        trade secret rights, confidentiality procedures and licensing
                                          arrangements to establish and protect our proprietary rights. Our
                                          source code for our proprietary software is protected as a trade
                                          secret. We have not applied for a patent for our KORE Engine.

RISKS RELATED TO OUR RELATIONSHIP WITH MCSi

OUR BUSINESS MAY BE MATERIALLY ADVERSELY  At the present time, MCSi has not decided whether it will retain or
AFFECTED DEPENDING UPON WHAT MCSi         dispose of our common stock that it currently owns. Until, and
DECIDES TO DO WITH ITS OWNERSHIP OF OUR   depending upon what decision is made, we will or may continue to be
COMMON STOCK.                             controlled by MCSi. As long as we are controlled by MCSi, the price of
                                          our shares in the public market could be adversely affected because of
                                          the reduced liquidity and the uncertainty as to if, when and how the
                                          shares held by MCSi would be sold or distributed to the public. Until
                                          a decision is made by MCSi, we cannot predict what will occur, what
                                          effects will result from such decision, or whether or when we or our
                                          shareholders will obtain the expected benefits, if any.

WE DEPEND ON MCSi FOR VARIOUS SERVICES    We have historically been dependent on MCSi for various services,
AND FOR A SIGNIFICANT PORTION OF OUR      including product fulfillment and distribution, customer service,
REVENUE.                                  facilities, human resources, management information systems, as well
                                          as for working capital. We have entered into a distribution services
                                          agreement, sublease agreement and an administrative services agreement
                                          with MCSi under which MCSi will continue to provide these services to
                                          us until October 2001 and lease property and equipment to us through
                                          May 2001. When the term of these agreements expire, we will need
                                          either to extend the term, engage other entities to perform these
                                          services or perform these services ourselves. MCSi may not continue to
                                          provide these services after the initial term of these agreements and
                                          the cost of these services could be significantly higher if we
                                          purchase services from other parties or devote resources to handle
                                          these functions internally.

                                          In addition, we provide e-commerce services for MCSi's computer supply
                                          and audio-visual products business under a two-year agreement. As a
                                          result, MCSi is one of our largest clients, and we currently expect
                                          that MCSi will remain a significant client for the

16

                                          foreseeable future. Consequently, a substantial portion of our
                                          business will be dependent upon the success of MCSi's sales and
                                          marketing of its products. Any decline in sales experienced by MCSi
                                          will have a negative effect on the revenues we would obtain from this
                                          agreement. Revenues related to the e-commerce services agreement with
                                          MCSi represented $2,408,121, or 47.2% of our total revenues for the
                                          nine months ended June 30, 2000. Additionally, for the nine months
                                          ended June 30, 2000, we had advertising revenue of $2,336,750, or
                                          45.8% of total revenue, which was primarily derived from original
                                          equipment manufacturer product advertisers who either placed banner
                                          advertisements on clients' Web pages which we serve or purchased
                                          preferential placement of the OEM products on clients' Web stores.
                                          MCSi has supply arrangements with the OEM companies that purchase
                                          advertising from us. Although we negotiate each OEM advertising
                                          arrangement, it is possible that MCSi's relationship with the OEM
                                          companies influenced our obtaining the advertising and we may not have
                                          obtained the advertising without MCSi's relationship. We cannot assure
                                          you that these relationships would continue if our relationship with
                                          MCSi were to change adversely.

                                          All of our agreements with MCSi were made in the context of a
                                          parent-subsidiary relationship. The prices charged to us, or by us, or
                                          the overall terms and conditions under these agreements may be higher
                                          or lower than the prices that may be charged by, or to, unaffiliated
                                          third parties for similar services.

MCSi WILL OWN 50.7% OF OUR COMMON STOCK   After the completion of this offering, MCSi will own approximately
AND WILL BE ABLE TO EXERT SUBSTANTIAL     50.7% of our outstanding shares of common stock, or approximately
INFLUENCE OVER OUR MANAGEMENT AND         48.9% if the underwriters exercise their over-allotment option in
CORPORATE AFFAIRS.                        full. As long as MCSi owns a significant portion of our outstanding
                                          common stock, MCSi will continue to be able to elect our entire board
                                          of directors and to remove any director, with cause, and generally to
                                          determine the outcome of all corporate actions requiring stockholder
                                          approval. As a result, MCSi will be in a position to continue to
                                          control all matters affecting our company, including:

                                          - the composition of our board of directors and, through it, any
                                            decisions with respect to the direction and policies of our company,
                                            including the appointment and removal of officers;

                                          - any decisions with respect to mergers or other business combinations
                                            involving our company;

                                          - the acquisition or disposition of assets by our company;

                                          - future issuances of common stock or other securities of our company;

                                          - the incurrence of debt by our company;

                                          - amendments, waivers and modifications to our distribution services
                                            agreement, administrative services agreement, sublease agreement and
                                            our e-commerce services agreement with MCSi; and

                                          - the payment of dividends on our common stock.

17

WE MAY HAVE POTENTIAL BUSINESS CONFLICTS  MCSi will continue to be one of our largest customers for a
OF INTEREST WITH MCSi.                    significant period of time and will continue to be our controlling
                                          stockholder for the foreseeable future. As a result, conflicts of
                                          interest may arise between us and MCSi in a number of areas,
                                          including:

                                          - the nature, quality and pricing of distribution or administrative
                                            services MCSi has agreed to provide to us;

                                          - the nature, quality and pricing of e-commerce services we provide to
                                            MCSi;

                                          - the incurrence of debt, the payment of dividends, the issuance of
                                            capital stock and business combinations by our company;

                                          - sales or distributions by MCSi of all or any portion of its
                                            ownership interest in our company; and

                                          - MCSi's ability to control the management and affairs of our company.

                                          We may not be able to resolve any potential conflicts or, if resolved,
                                          we may not be able to receive more favorable resolution than if we
                                          were dealing with an unaffiliated party. Conflicts could be resolved
                                          in a manner adverse to us and our stockholders, which could materially
                                          affect our business, results of operations and financial condition or
                                          stock price. The distribution services agreement, administrative
                                          services agreement, e-commerce services agreement and the sublease
                                          agreement we have entered into with MCSi may be amended from time to
                                          time upon agreement between the parties. As long as we are controlled
                                          by MCSi, MCSi could require us to agree to an amendment to the
                                          distribution services agreement, administrative services agreement,
                                          sublease agreement or any other agreement that may be more or less
                                          favorable to us than the current terms of those agreements.

SOME OF OUR DIRECTORS MAY HAVE CONFLICTS  After this offering, one of the five members of our board of directors
OF INTEREST BECAUSE THEY ARE ALSO         will also be a director of MCSi. Our chairman is the chairman of the
DIRECTORS AND STOCKHOLDERS OF MCSi.       board and chief executive officer of MCSi. In addition, two of our
                                          directors, our president and our chief financial officer and eight of
                                          our employees hold shares of MCSi common stock and/or options to
                                          acquire shares of MCSi common stock. These individuals may have
                                          conflicts of interest with respect to certain decisions involving
                                          business opportunities and similar matters that may arise in the
                                          ordinary course of our business or the business of MCSi. Conflicts, if
                                          any, could be resolved in a manner adverse to us and our stockholders,
                                          which could materially adversely affect our business, results of
                                          operations and financial condition or stock price.

18

                                         RISKS RELATED TO THIS OFFERING

THE SALE OF A SUBSTANTIAL NUMBER OF       The market price of our common stock could drop as a result of sales
SHARES OF OUR COMMON STOCK AFTER THIS     of substantial amounts of common stock in the public market after the
OFFERING MAY AFFECT OUR STOCK PRICE.      closing of this offering or the perception that substantial sales
                                          could occur. In addition, the sale of these shares could impair our
                                          ability to raise capital through the sale of additional equity
                                          securities. After this offering, MCSi will own 8,347,944 shares of our
                                          common stock, two other investors will own an aggregate of 1,804,956
                                          shares, three of our executive officers will own 2,030,580 shares, our
                                          chairman has an option to acquire 676,860 shares and a client will
                                          have a warrant to purchase up to 1.7% of the number of shares issued
                                          and outstanding immediately after this offering (not including the
                                          underwriters' overallotment option). We have agreed to register all of
                                          the shares of our common stock to be held by MCSi and these investors
                                          and executive officers upon demand after this offering. If MCSi
                                          distributes these shares to its stockholders or MCSi, the other
                                          investors, our executive officers or director sell registered shares
                                          in the public market, those shares will be eligible for immediate
                                          resale in the public market, other than any shares held by our
                                          affiliates. We cannot predict whether substantial amounts of our
                                          common stock will be sold in the open market in anticipation of, or
                                          following, any distribution of our shares by MCSi, the investors, the
                                          director or executive officers. Except as described below, MCSi, the
                                          investors, our director and executive officers have the sole
                                          discretion to determine the timing, structure and all terms of any
                                          distribution or sale of our common stock they hold, all of which may
                                          also affect the level of market transactions in, and the price of, our
                                          common stock.

                                          Upon completion of this offering, we will have outstanding an
                                          aggregate of 16,473,480 shares our common stock, based upon the number
                                          of shares outstanding as of June 30, 2000. Of these shares, all of the
                                          shares sold in this offering will be freely tradable without
                                          restriction or further registration under the Securities Act of 1933,
                                          unless such shares are purchased by our "affiliates," as that term is
                                          defined in Rule 144 under the Securities Act. The 12,183,480 shares of
                                          common stock held by existing stockholders are "restricted securities"
                                          as that term is defined in Rule 144. Restricted shares may be sold in
                                          the public market only if registered or if they qualify for an
                                          exemption from registration, such as those provided by Rule 144 or
                                          Rule 701 under the Securities Act. As a result of contractual
                                          restrictions in our agreement with William Blair & Co. prohibiting
                                          MCSi, our officers and directors and our investors from selling their
                                          shares of common stock prior to 180 days after this offering, and the
                                          provisions of Rule 144 and Rule 701, additional shares will be
                                          available for sale in the public market as follows:

                                          - no restricted shares will be eligible for immediate sale on the date
                                            of this prospectus;

19

                                          - 12,183,480 restricted shares will be eligible for sale upon
                                            expiration of the lock-up agreements 180 days after the date of this
                                            prospectus; and

                                          - the remainder of the restricted shares will be eligible for sale
                                            from time to time thereafter upon expiration of their respective
                                            one-year or two-year holding periods depending on whether or not
                                            they are held by affiliates.

PURCHASERS OF OUR COMMON STOCK IN THIS    The initial public offering price is substantially higher than the net
OFFERING WILL EXPERIENCE IMMEDIATE AND    tangible book value per share of our outstanding common stock
SUBSTANTIAL DILUTION.                     immediately after this offering. The net tangible book value per share
                                          represents the amount of our total tangible assets less our total
                                          liabilities divided by the total number of shares of common stock
                                          outstanding prior to this offering. Accordingly, purchasers of common
                                          stock will experience immediate and substantial net tangible book
                                          value dilution of approximately $10.40 per share, or approximately
                                          74.3% of the offering price of $14.00 per share. See "Dilution."

OUR AMENDED AND RESTATED CERTIFICATE OF   Certain provisions of our amended and restated certificate of
INCORPORATION, OUR AMENDED AND RESTATED   incorporation and amended and restated bylaws may discourage, delay or
BYLAWS AND DELAWARE LAW MAKE IT           prevent a merger or acquisition that a stockholder may consider
DIFFICULT FOR A THIRD PARTY TO ACQUIRE    favorable. Such provisions include:
US.                                       - authorizing the issuance of "blank check" preferred stock;
                                          - providing for a classified board of directors with staggered, three-
                                            year terms;
                                          - prohibiting cumulative voting in the election of directors;
                                          - limiting the persons who may call special meetings of stockholders;
                                          - limiting the liability of our directors, and providing them with
                                          full rights of indemnity; and
                                          - establishing advance notice requirements for nominations for
                                            election to the board of directors or for proposing matters that can
                                            be acted on by stockholders at stockholder meetings.

                                          Certain provisions of Delaware law and our stock option plans may also
                                          discourage, delay or prevent someone from acquiring or merging with
                                          us. For more information, please see "Management--1999 Stock Option
                                          Plan" and "Description of Capital Stock."

20

USE OF PROCEEDS

We estimate that we will receive net proceeds of $55.0 million from the sale of the 4,290,000 shares of common stock in this offering, at the assumed initial public offering price of $14.00 per share and after deducting estimated underwriting discount and the estimated offering expenses of $1.2 million. If the underwriters' over-allotment option is exercised in full, we estimate that our net proceeds will be $62.7 million.

The principal purposes of this offering are to obtain additional working capital, create a public market for our common stock and to facilitate future access by Zengine to public equity markets. We generally intend to use the net proceeds of this offering as follows:

- hiring of additional technical, direct sales and marketing personnel (approximately $9 million);

- expansion of our market activities (approximately $12 million);

- capital expenditures (approximately $5 million); and

- working capital (approximately $29 million).

In addition, we may, if appropriate opportunities arise, use an undetermined portion of the net proceeds to engage in strategic alliances or to acquire or invest in complementary companies, product or service lines, or technologies. While we engage in discussions relating to strategic alliances or potential investments which complement our existing business on an on-going basis, we do not have any agreements or commitments with respect to any proposed alliance, acquisition or investment. Pending such uses, we will invest the net proceeds in investment grade, interest-bearing securities.

DIVIDEND POLICY

We have never paid any cash dividends on our common stock and do not anticipate paying any cash dividends in the foreseeable future.

21

CAPITALIZATION

The following table sets forth our cash and capitalization as of June 30, 2000 on an actual basis (based on the assumptions set forth in the Summary) and an as adjusted basis after giving effect to the issuance of 4,290,000 shares of common stock in this offering, assuming an initial public offering price of $14.00 per common share.

                                                                 AS OF JUNE 30, 2000
                                                              -------------------------
                                                                ACTUAL      AS ADJUSTED
                                                              -----------   -----------
Cash........................................................  $        --   $55,038,000
                                                              ===========   ===========
Stockholders' Equity:
  Preferred stock, no par value; no shares authorized,
    issued or outstanding, actual; 20,000,000 shares
    authorized, none issued and outstanding, as adjusted....  $        --   $        --
  Common stock, no par value; 100,000,000 shares authorized,
    12,183,480 shares issued and outstanding; 100,000,000
    shares authorized, 16,473,480 shares issued and
    outstanding, as adjusted................................           --            --
  Additional paid-in capital................................    7,353,250    62,391,250
  Unearned compensation.....................................   (2,056,075)   (2,056,075)
  Accumulated deficit.......................................   (1,010,084)   (1,010,084)
                                                              -----------   -----------
      Total stockholders' equity............................  $ 4,287,091   $59,325,091
                                                              ===========   ===========

The table above excludes:

- 1,380,118 shares of common stock subject to outstanding options at a weighted average exercise price of approximately $.89 per share;

- 2,004,182 shares of common stock reserved for future stock option grants and purchases under our equity compensation plan; and

- 280,049 shares of common stock issuable upon exercise of the outstanding warrant at an exercise price per share equal to the per share initial public offering price.

22

DILUTION

The net tangible book value of our common stock as of June 30, 2000 was $4.3 million, or $0.35 per share of common stock. Net tangible book value per share represents the amount of our total tangible assets less our total liabilities, divided by the total number of shares of common stock outstanding prior to this offering.

After giving effect to this offering and the receipt of $55.0 million of net proceeds from this offering (based on an assumed initial public offering price of $14.00 per share), the pro forma net tangible book value of the common stock as of June 30, 2000 would have been approximately $59.3 million, or $3.60 per share. This amount represents an immediate increase in net tangible book value of $3.25 per share to MCSi and our other existing stockholders, and an immediate dilution in net tangible book value of $10.40 per share to purchasers of common stock in this offering. Dilution is determined by subtracting pro forma net tangible book value per share after this offering from the amount of cash paid by a new investor for a share of common stock. The following table illustrates such dilution:

Assumed initial public offering price per share...........            $ 14.00
                                                                      -------
Net tangible book value per share at June 30, 2000........  $  0.35
                                                            -------
Increase in pro forma net tangible book value per share
  attributable to new investors...........................     3.25
                                                            -------
Pro forma net tangible book value per share after this
  offering................................................               3.60
                                                                      -------
Dilution per share to new investors.......................            $ 10.40
                                                                      =======

The following table sets forth, as of June 30, 2000, on the pro forma basis described above, the number of shares of common stock purchased from us, the total consideration paid to us and the average price per share paid by the existing stockholders and by new investors who purchase shares of common stock in this offering, before deducting the estimated underwriting discounts and offering expenses.

                                               SHARES PURCHASED       TOTAL CONSIDERATION      AVERAGE
                                             ---------------------   ----------------------     PRICE
                                               NUMBER     PERCENT      AMOUNT      PERCENT    PER SHARE
                                             ----------   --------   -----------   --------   ---------
Existing stockholders......................  12,183,480     74.0%    $ 7,353,250     10.9%     $ 0.60
New investors..............................   4,290,000     26.0      60,060,000     89.1       14.00
                                             ----------    -----     -----------    -----
Total......................................  16,473,480    100.0%    $67,413,250    100.0%     $ 4.09
                                             ==========    =====     ===========    =====

If the underwriters' over-allotment option is exercised in full, sales in this offering will reduce the number of shares of common stock held by the existing stockholders to approximately 71.4% of the total shares of common stock outstanding after the offering and will increase the number of shares held by new investors to 4,875,000 or approximately 28.6% of the total shares of common stock outstanding after the offering.

The foregoing table excludes outstanding stock options to purchase an aggregate of 1,380,118 shares of common stock at a weighted average exercise price of $.89 per share and an outstanding warrant to purchase up to 1.7% of the shares of common stock outstanding immediately after this offering (not including the underwriters' overallotment option) at the initial public offering price per share. Exercise of these outstanding options and the warrant would result in dilution per share of $.05 after the offering. We may also issue additional shares of common stock upon exercise of future stock option grants, which could also result in additional dilution to then-existing stockholders.

23

SELECTED FINANCIAL DATA

The selected financial data set forth below for the period from inception (January 1, 1999) to September 30, 1999 and the six months ended March 31, 2000, has been derived from our financial statements which have been audited by PricewaterhouseCoopers LLP, independent accountants, whose report is included elsewhere in this prospectus. The unaudited interim financial data for the three and nine month periods ended June 30, 2000 has been derived from our unaudited interim financial statements, which in the opinion of management, includes all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation thereof. The selected financial data set forth below should be read in conjunction with "Management's Discussion and Analysis of Financial Condition and Results of Operations," and our financial statements and the accompanying notes thereto included elsewhere in this prospectus.

                                        PERIOD FROM
                                         INCEPTION                                THREE MONTHS       NINE MONTHS
                                    (JANUARY 1, 1999) TO    SIX MONTHS ENDED         ENDED              ENDED
                                   SEPTEMBER 30, 1999(1)    MARCH 31, 2000(1)   JUNE 30, 2000(1)   JUNE 30, 2000(1)
                                   ----------------------   -----------------   ----------------   ----------------
RESULTS OF OPERATIONS DATA:
Revenue
    Third party..................        $    4,089            $1,354,088          $1,295,077         $2,649,165
    Related Party................                --             1,356,828           1,098,293          2,455,121
                                         ----------            ----------          ----------         ----------
                                              4,089             2,710,916           2,393,370          5,104,286
                                         ----------            ----------          ----------         ----------
Cost of revenue
    Third party..................            23,511               231,752             203,791            435,543
    Related party................                --                55,253              24,000             79,253
                                         ----------            ----------          ----------         ----------
                                             23,511               287,005             227,791            514,796
                                         ----------            ----------          ----------         ----------
Gross profit (loss)..............           (19,422)            2,423,911           2,165,579          4,589,490
                                         ----------            ----------          ----------         ----------
Selling, general and
  administrative expenses(2)
    Third party..................           401,081             1,897,202           1,663,253          3,560,455
    Related party................           513,120               435,000             794,251          1,229,251
                                         ----------            ----------          ----------         ----------
                                            914,201             2,332,202           2,457,504          4,789,706
                                         ----------            ----------          ----------         ----------
Income (loss) from operations....          (933,623)               91,709            (291,925)          (200,216)
Interest income..................                --                81,464              42,291            123,755
                                         ----------            ----------          ----------         ----------
Income (loss) before income
  taxes..........................          (933,623)              173,173            (249,634)           (76,461)
Provision for income taxes.......                --                    --                  --                 --
                                         ----------            ----------          ----------         ----------
Net income (loss)................        $ (933,623)           $  173,173          $ (249,634)        $  (76,461)
                                         ==========            ==========          ==========         ==========
Earnings (loss) per share of
  common stock--basic............        $     (.08)           $      .02          $     (.02)        $     (.01)
                                         ==========            ==========          ==========         ==========
Earnings (loss) per share of
  common stock-diluted...........        $     (.08)           $      .01          $     (.02)        $     (.01)
                                         ==========            ==========          ==========         ==========
Weighted average number of common
  shares outstanding--basic......        11,377,184            11,091,515          11,196,537         11,143,051
                                         ==========            ==========          ==========         ==========
Weighted average number of common
  shares outstanding-diluted.....        11,377,184            13,338,169          11,196,537         11,143,051
                                         ==========            ==========          ==========         ==========

                                                                    AT
                                                              SEPTEMBER 30,           AT
                                                                 1999(1)       JUNE 30, 2000(1)
                                                              --------------   ----------------
BALANCE SHEET DATA:
Working capital (deficit)...................................     $(92,167)        $3,549,790
Total assets................................................     $355,320         $5,447,043
Long-term debt..............................................           --                 --
Total debt..................................................           --                 --
Stockholders' equity........................................     $262,747         $4,287,091

24


Notes:

(1) The data reflects selected results of operations and balance sheet data from the period from our inception (January 1, 1999) through September 30, 1999 and for the nine month period ended June 30, 2000. Because our inception was on January 1, 1999, comparable data for the six month period ended March 31, 1999 and for the nine month period ended June 30, 2000 is not available. For all periods presented, revenue, cost of revenue and selling, general and administrative expenses include related party transactions with MCSi. See Note 4 to our financial statements included elsewhere in this prospectus.

(2) Selling, general and administrative expenses for the nine month period ended September 30, 1999, for the six month period ended March 31, 2000, for the three month period ended June 30, 2000 and for the nine month period ended June 30, 2000 include $89,483, $113,173, $116,583 and $229,756, respectively, of non-cash compensation expense. See Note 7 to our financial statements included elsewhere in this prospectus.

25

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

THE FOLLOWING DISCUSSION SHOULD BE READ IN CONJUNCTION WITH "SELECTED

FINANCIAL DATA" AND THE FINANCIAL STATEMENTS AND THE ACCOMPANYING NOTES THERETO INCLUDED ELSEWHERE IN THIS PROSPECTUS. THE FOLLOWING INFORMATION CONTAINS FORWARD-LOOKING STATEMENTS THAT INVOLVE CERTAIN RISKS AND UNCERTAINTIES. ACTUAL RESULTS AND EVENTS MAY DIFFER SIGNIFICANTLY FROM THOSE DISCUSSED IN THE FORWARD-LOOKING STATEMENTS.

OVERVIEW

We were formed as a division of MCSi in January 1999 to sell computer and audio-visual products, primarily to the small office/home office, or SOHO, market. We were subsequently incorporated as a wholly owned subsidiary of MCSi in March 1999. Also in March 1999, we hired three key executives, Mr. Joseph Savarino, Mr. Lalit Dhadphale and Mr. Christopher Feaver, to revise our business concept beyond the sale of computer and audio-visual products to the Zengine business model of providing a full range of e-commerce services to the B2B and B2C markets. At such time, we also began to work with dedicated Web sites of MCSi to enhance, modify and maintain these Web sites; we subsequently entered into an e-commerce agreement with MCSi related to these activities on October 1, 1999. We entered into our first third party client contract using the Zengine business model in September 1999, and we legally changed our corporate name to Zengine, Inc. in the Fall of 1999, after doing business as Zengine since March 1999.

ZENGINE SERVICES

We provide a comprehensive suite of technology-based solutions that enable businesses to conduct electronic commerce. We offer a full range of integrated services for both B2B and B2C e-commerce platforms, including Web site user interface design, product content and merchandising, personalization and customer relationship management, advertising and sponsorship management, order management, inventory management and order fulfillment, end-user customer service and reporting and analysis. Our solutions are delivered on an outsourced basis, which means we produce and operate our client's e-commerce Web sites under their brand. This allows our clients to quickly and cost-effectively create, maintain and enhance their e-commerce presence. Our proprietary technology and infrastructure, the KORE Engine, enables these services; KORE is a highly scalable and reliable platform that uses personalization as the centerpiece for managing on-line customer relationships.

In performing our services under the Zengine business model, we enter into contractual arrangements with our clients that describe the services we will perform. We generate revenues through service fees, which include integration and set-up, monthly subscription and transaction fees and from advertising and sponsorships on Web pages we service on our client's stores.

REVENUE

SERVICE FEES

INTEGRATION AND SET-UP FEES

We provide integration and set-up services to our clients. Under these arrangements, our services may include the development or design of a client's Web site, migration of the client's current Web site content to our technology, integration of the client's Web site to the client's current computer systems or other similar activities. To the extent that these fees are associated with a contract to provide subsequent outsourced transaction-based services to a client, these fees are recognized ratably over the term of the transaction services agreement. Otherwise, revenue is recognized when the service is completed, the client has accepted the service and we have no future obligation to provide any additional services.

26

SUBSCRIPTION FEES

Our subscription arrangements provide for maintenance and related services over a specified time for a fee. Revenue from subscription fees is recognized ratably over the term of the subscription.

TRANSACTION FEES

We provide outsourced transaction-based services to customers, such as providing product content and merchandising, transaction processing, order management, custom fulfillment and end-user customer service. Revenues from transaction fees are generally in the form of a commission. Under our first two arrangements with third party clients, our revenue is determined as a percentage of the gross margin on revenues. Under all other arrangements entered into between our clients and us, our revenue is based on a percentage of net revenues. Revenue from transaction fees is recognized when the service is completed.

ADVERTISING AND SPONSORSHIP FEES

Revenues from advertising take the form of fees when we sell banner advertising, product placement or other forms of advertising on Web pages we service on our clients' stores. These arrangements call for continuous advertising or product placement over a certain time period and are not contingent upon events such as obtaining certain levels of sales, Web site visits or other factors. Revenue is recognized ratably over the period of the advertising/product placement services based on the fulfillment of obligations under the advertising/product placement arrangements.

EXPENSES

Our expenses consist of costs associated with our revenues and selling, general and administrative expenses. Cost of revenues consists of the salaries, employee benefits and related expenses of our people who work on preparation of our client's sites. It also includes the depreciation of the computer hardware and software utilized in providing these services. Furthermore, we have entered into a distribution services agreement with MCSi where we pay MCSi three percent of the total revenues we receive from our third party clients on the transactions in which MCSi performs the inventory management and/or order fulfillment functions. Our selling, general and administrative expenses includes the salaries, employee benefits, travel and related expenses of our sales personnel, advertising expenses and marketing and sales support functions, as well as our facility related expenses.

We anticipate that our expenses will increase substantially in the future as we expand our services to new clients.

ARRANGEMENTS WITH MCSI

At the time that MCSi began our operations, MCSi had been providing dedicated Web site order fulfillment services to a variety of its business customers (the "dedicated Web site operations"). Over the course of the Spring and Fall of 1999, MCSi began to transfer its dedicated Web site customers to us for designing, enhancing and providing certain support services to these sites. Effective October 1, 1999, we entered into an e-commerce services agreement with MCSi whereby we provide design, enhancement and certain support services to the dedicated Web site operations of MCSi and receive a fee of ten percent on the retail value of goods sold to these dedicated Web site customers.

Also effective October 1, 1999, we entered into a distribution services agreement with MCSi, under which we will pay MCSi three percent of the retail value of goods sold to third party clients who utilize the inventory management and order fulfillment services which MCSi provides to us. We subsequently amended the agreement to pay MCSi for warehouse space equal to a percentage of MCSi's gross expenses relating to the operation of the warehouse for us through the end of the term of the agreement. Finally, effective October 1, 1999, we entered into an administrative services agreement,

27

under which MCSi provides us with accounting, treasury, tax, insurance and other services for an annual fee of $720,000 per year, and a sublease and equipment lease agreement under which MCSi leases to us real and personal property used in our business for an annual fee of $150,000 per year.

The terms of our arrangements with MCSi do not necessarily represent those which would be obtained in an arm's-length transaction with an unrelated party.

RESULTS OF OPERATIONS

During September 1999, we signed our first client contract under the Zengine business model, and we began earning revenue from this contract in October 1999. Accordingly, our financial results prior to October 1, 1999 are not representative of our current business model. We have not presented amounts for the six month period ended March 31, 1999 or the nine month period ended June 30, 1999 as we were not in existence for that period and were not operating under our current business model. Accordingly, prior period amounts from our inception (January 1, 1999) to June 30, 1999 are not meaningful or comparable.

REVENUE

Revenue for the periods presented is summarized as follows:

                                             NINE MONTHS     SIX MONTHS
                                                ENDED          ENDED       THREE MONTHS     NINE MONTHS
                                            SEPTEMBER 30,    MARCH 31,        ENDED            ENDED
                                                 1999           2000      JUNE 30, 2000    JUNE 30, 2000
                                            --------------   ----------   --------------   --------------
                                                                           (UNAUDITED)      (UNAUDITED)
Service fees..............................      $   --       $1,361,666     $1,405,870       $2,767,536
Advertising and sponsorship fees..........          --       1,349,250         987,500        2,336,750
Product sales.............................       4,089              --              --               --
                                                ------       ----------     ----------       ----------
                                                $4,089       $2,710,916     $2,393,370       $5,104,286
                                                ======       ==========     ==========       ==========

The increases in revenues, as shown above, reflect the implementation of our business plan and the launch of our clients' e-commerce Web sites, along with adding additional Web sites being serviced under our e-commerce services agreement with MCSi.

Our revenue for the nine months ended June 30, 2000 totaled $5,104,286. At June 30, 2000, we had 12 e-commerce clients. Service fee revenue from the MCSi dedicated Web sites was $2,408,121 for the nine months ended June 30, 2000, which was 47.2% of our total revenue for the period. Our current arrangement to service the MCSi dedicated Web sites expires on October 1, 2001. In addition, we had advertising revenue of $2,336,750, or 45.8% of total revenue, which was primarily derived from OEM product advertisers who either placed banner advertisements on clients' Web pages which we serve, or purchased preferential placement of the OEM manufacturers products on clients' stores. We have provided advertising or sponsorship services to 14 clients as of June 30, 2000. MCSi has supply arrangements with the OEM companies that purchase advertising from us. Although we negotiate each OEM advertising arrangement, MCSi's relationship with the OEM companies could have influenced our obtaining the advertising and we may not have obtained the advertising without MCSi's relationship.

Our revenue for the three months ended June 30, 2000 totaled $2,393,370. Service fee revenue from the MCSi dedicated Web sites was $1,098,293 for the three months ended June 30, 2000, which was 45.9% of our total revenue for the period. In addition, we had advertising revenue of $987,500 or 41.3% of total revenue, which was primarily derived from OEM product advertisers who either placed banner advertisements on clients' Web pages which we serve, or purchased preferential placement of the OEM manufacturers products on clients' stores.

28

Our revenue for the six months ended March 31, 2000 totaled $2,710,916. During the six months ended March 31, 2000, we initiated our Zengine service offerings and began servicing e-commerce clients. At March 31, 2000 we had seven e-commerce clients. Service fee revenue from the MCSi dedicated Web sites was $1,309,828 for the six months ended March 31, 2000, which was 48.3% of our total revenue for the period. In addition, we had advertising revenue of $1,349,250, or 49.8% of total revenue, which was primarily derived from OEM product advertisers who either placed banner advertisements on clients' Web pages which we serve, or purchased preferential placement of the OEM manufacturers products on clients' stores.

From the date of our inception to September 30, 1999, our revenues totaled $4,089. These revenues arose from the sale of computer supply and audio-visual products to consumers under our previous business model.

COST OF REVENUE

Our cost of revenue includes the amortization of capitalized computer software costs, the costs of our employees to perform integration and other services and the three percent fee we pay to MCSi under the distribution services agreement, which expires on October 1, 2001.

As a percentage of our revenues, our gross margin was 89.9% for the nine months ended June 30, 2000, 90.5% for the three months ended June 30, 2000, and 89.4% for the six months ended March 31, 2000, all under our current business model. These percentages fluctuate depending primarily on the timing as to when we add additional employees to perform integration and other services.

Our costs of revenues were $23,511 for the period ended September 30, 1999 and reflects costs we incurred for the products we sold arising from the activities of our previous business model and the amortization of capitalized computer software costs.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

Selling, general and administrative expenses for the periods presented, along with these amounts stated as a percentage of our revenues during the periods we operated under the Zengine business model, is shown below:

Nine months ended June 30, 2000..........................  $4,789,706     93.8%
Three months ended June 30, 2000.........................  $2,457,504    102.7%
Six months ended March 31, 2000..........................  $2,332,202     86.0%

Changes in selling, general and administrative expenses are also influenced as to the timing of when we add additional personnel to support these functions. Our selling, general and administrative costs during the nine months and three months ended June 30, 2000 was also impacted by an amendment to our distribution services agreement with MCSi which totalled $326,751.

Our selling, general and administrative expenses for the nine months ended September 30, 1999 were $914,201 and relate primarily to costs incurred to develop the Zengine business model. The more significant selling, general and administrative expenses relate to payroll and accounting processing costs, salaries and rent.

INCOME TAXES

We did not provide for any income taxes because we have prepared our provision for income taxes as if we were a separate entity. We do not owe any income taxes because we have incurred tax basis operating losses since our inception, and we did not record any deferred tax benefits relating to these operating losses or any other deferred tax benefits because we presently believe it is more likely than not that they will not be realized.

29

LIQUIDITY AND CAPITAL RESOURCES

During the nine months ended June 30, 2000, we used $1,667,492 of cash in operations primarily as a result of our loss from operations, increased receivables and increased other assets relating to deferred offering costs and prepayments to a customer for sole provider status. We used $2,203,963 of cash for investing activities to fund a demand note to MCSi and to fund expenditures for software development and capital expenditures. Cash provided by financing activities of $3,871,049 is the net cash we received from the sale of our common stock during the period.

During the three months ended June 30, 2000, we used $414,963 of cash in operations primarily as a result of our loss from operations and increased receivables. We generated $364,230 of cash from investing activities as a result of favorable net cash settlements with MCSi relating to our demand note with MCSi, partially offset by the funding of software development and capital expenditures.

During the six months ended March 31, 2000, we used $1,252,529 in cash flow from operations, primarily as a result of increased receivables and prepayments to a customer for sole provider status, offset by increased accruals. We used $2,568,193 of cash for investing activities to fund a demand note to MCSi and to fund expenditures for software development costs and capital expenditures. Cash provided by financing activities of $3,871,049 is the net cash we received from the sale of our common stock during the period.

Primarily by virtue of our losses from operations, we used $730,076 in cash for operations for the period from inception to September 30, 1999. Additionally, we used cash of $376,405 for investing purposes, primarily reflecting software development costs incurred to develop our technology, once we had established its technological feasibility. We were provided cash flow from financing activities of $1,106,887 for the period from inception to September 30, 1999 because MCSi paid for and contributed to our capital the cash we required to fund our operating and investing activities.

GENERAL

Since our inception, we have looked to MCSi to provide the financial and capital resources we have required to carry on our business activities. Should the offering of the common stock to which this prospectus relates not occur, we would continue to look to MCSi for the financial resources we need to carry on our operations, and we believe those resources will be adequate to fund our operations for the next twelve months.

If this offering of common stock occurs, MCSi will not be permitted to loan us money to provide funding for our operations, and if the proceeds from the offering are not sufficient to fund our future operating and investing needs, we may have to look to other sources of financing such as bank loans or the issuance of debt or equity securities. In any event, we believe that the capital resources provided by this initial public offering will be sufficient to enable us to pursue our operations under our business model for the foreseeable future.

As described above, we have entered into certain arrangements with MCSi. Each of these arrangements provide for monthly "net" settlement, which typically is effectuated by increasing or decreasing the amounts receivable/payable between MCSi and us.

On October 1, 1999, we entered into an e-commerce services agreement with one of our clients, Excite@Home. In addition to our providing e-commerce services, we entered into a stock purchase agreement which called for Excite@Home and an unrelated financial investor, Wilblairco Associates (an affiliate of our managing underwriter, William Blair & Company) to purchase an aggregate of 1,804,956 shares of our common stock for $2.22 per share, or $4,000,000. After deducting expenses related to the sale of common stock, we realized net proceeds of $3,871,049. We loaned these net proceeds to MCSi under a demand note arrangement and we use these funds as needed to fund our operations. The e-commerce services agreement also commits us to pay $600,000 to be the sole audio-visual provider of Excite@Home and Dow Jones & Co.'s Work.com Web site and to purchase

30

$3,400,000 of advertising from Excite@Home through December 2001, which we will expense as the related advertising services are provided. See "Certain Transactions."

In March 2000, Zengine and PNC Bank agreed to enter into a secured expandable revolving line of credit to provide Zengine up to $5,000,000 for working capital and general corporate purposes. The line of credit will have a term of one year and is subject to the successful completion of an initial public offering with proceeds of at least $35 million.

As a result of entering into the lease and administrative services agreements with MCSi, the Company is committed to the following payments for the periods presented below:

                                                    SUBLEASE AND     ADMINISTRATIVE
                                                      EQUIPMENT         SERVICE
                                                   LEASE AGREEMENT     AGREEMENT
                                                   ---------------   --------------
Three months ending September 30, 2000...........     $ 37,500         $  180,000
Year ending September 30, 2001...................      100,000            720,000
                                                      --------         ----------
  Total..........................................     $137,500         $  900,000
                                                      ========         ==========

RECENT ACCOUNTING PRONOUNCEMENTS

We are not aware of any pending accounting pronouncements that we believe will have a material impact on our financial position, results of operations or cash flows, including the provisions of Staff Accounting Bulletin 101, which was recently issued by the Securities and Exchange Commission.

MARKET RELATED RISKS

Currently, all of our operations are domestic, we have no debt and we do not hold or issue derivative financial instruments. Accordingly, our risk relating to foreign exchange and changes in interest rates has not been an issue. In the future, we intend to pursue international clients and will enter into a revolving line of credit that has a variable rate of interest. Accordingly, we will need to develop means to monitor and control these market related risks in the future.

SEASONALITY

We anticipate that we will experience some seasonality based on the year end holiday selling season.

31

BUSINESS

OVERVIEW

Zengine provides a comprehensive suite of technology-based solutions that enable businesses to conduct electronic commerce. We offer a full range of integrated services for both business-to-business, or B2B, and business-to-consumer, or B2C, e-commerce including Web site user interface design, product content and merchandising, personalization and customer relationship management, advertising and sponsorship management, order management, inventory management and order fulfillment, end-user customer service and reporting and analysis. We believe our ability to offer a comprehensive set of services and our focus on personalizing customer relationships provides us with a competitive advantage in the marketplace. We provide our solutions on a complete, or "turn-key," package basis or as component features and are able to significantly reduce our clients' time-to-market and the infrastructure, human resource, development and maintenance costs typically required for enterprise wide e-commerce initiatives. We market our services to businesses seeking to initiate, expand or enhance their ability to conduct e-commerce. Our solutions are delivered on an outsourced basis, which means we produce and operate our client's e-commerce Web sites under their brand. This allows our clients to quickly and cost-effectively create, maintain and enhance their e-commerce presence.

Zengine's solutions are centered around its proprietary technology and infrastructure, the KORE Engine. The functional components of KORE are stored on a centralized server array which services all of Zengine's clients. This architecture minimizes development costs and reduces time to market because we are able to leverage existing functionality previously developed within KORE rather than re-engineering the functionality for each application. Upon completion, the component or feature can be made available to other Zengine clients without added development time or cost. In addition, the KORE Engine is built to be highly-scalable, permitting our clients to deliver consistent quality of service as transaction volumes increase, enabling the rapid deployment of high-speed, dynamic e-commerce Web sites. The real time personalization technology proprietary to KORE allows businesses to manage online customer relationships and personalize communication with their customers and trading partners. The KORE Engine gives us the ability to offer both front-end Web site content and design along with back-end transaction processing and order management functionality. We believe that this allows our clients to achieve rapid deployment of e-commerce platforms, results in greater economies of scale and provides cost-effective, ongoing access to leading edge e-commerce technology. The KORE Engine enables the creation of an e-commerce platform that creates or replicates the look, feel and functionality of the client's Web site.

Using our technology and services, our client's customers experience all services under our client's brand, including browsing, ordering, paying, receiving ordered products and obtaining customer support by e-mail or telephone. When visitors enter a client's home page, secure extranet or store function within a client's Web site, they are seamlessly and transparently transferred to our network where they enter a personalized shopping environment. By soliciting and tracking user information and behavior, we use our KORE Engine to anticipate user preferences and interests and assist visitors in obtaining desired products. We solicit user information by means of questionnaires, warranty cards, rebates and surveys and we track user behavior through purchase history and Web site visitation behavior. Accordingly, we can suggest products to a user based upon their prior transactions and preferences. Our B2B services focus on building secure corporate extranets for clients who sell products directly to their corporate customers and channel partners as well as clients who are purchasing operating resources from their vendors. To date, we have provided our clients a fully operational Web site to transact e-commerce business within an average of 40 days from the commencement of our services compared to industry ranges of several months to over one year.

We actively market our services through a direct sales force to businesses seeking to initiate, expand or enhance their ability to conduct e-commerce, including:

- original equipment manufacturers;

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- wholesalers, distributors and other businesses that create customized vendor and supply chain relationships over the Internet or a secure extranet;

- bricks and mortar, or BAM, retailers;

- online-only retailers; and

- Web sites that have a large and loyal user base (including portals, pure content sites, communities, directories and service providers).

Our plan is to continue to pursue these target clients and to penetrate other markets through indirect distribution channels such as consulting firms, systems integrators, advertising firms, and other professional services firms.

Our revenue is generated through a combination of one or more of the following: initial set-up and integration fees, subscription fees, transaction fees and advertising and sponsorship fees on our clients' Web site.

INDUSTRY BACKGROUND

THE INTERNET

Widespread acceptance of the Internet has opened numerous opportunities for companies seeking growth and increased efficiencies through B2B and B2C e-commerce. The GartnerGroup estimates that B2B e-commerce will grow from $145 billion in 1999 to $3.9 trillion in 2003, and B2C e-commerce will increase from $31 billion in 1999 to $381 billion in 2003, representing five-year compound annual growth rates of 128% and 87%, respectively. In addition, International Data Corporation, or IDC, estimates the number of Internet purchasers will increase from approximately 17 million in 1999 to over 80 million in 2003, a compound annual growth rate of 47%.

An increasing number of businesses engage e-commerce service providers to design and implement e-commerce solutions. Although no figures are yet available on the size of the full-service e-commerce outsourcing market, traditional e-commerce outsourcing, usually defined as Web site design, strategy consulting, and software creation and hosting, was a $4.6 billion industry in 1998 and is expected to grow to $39 billion by 2002 according to IDC representing a compound annual growth rate of 53%. Furthermore, IDC projects that the world wide market for Internet professional services will grow from $12.9 billion in 1999 to $78.6 billion in 2003, representing a compound annual growth rate of approximately 57%.

E-COMMERCE AND CUSTOMER RELATIONSHIP MANAGEMENT

Most companies today recognize that the Internet enables powerful functionality ranging from display and order processing to complete supplier-vendor-customer integration and relationship management. As customer and supplier expectations increase as a result of industry advancement, companies are forced to take advantage of and develop more sophisticated Internet applications. With competition only a mouse-click away, organizations seek to differentiate themselves by providing superior informational and transactional experiences for their customers through personalized Web sites that are easy to use and better manage the unique online relationship possible between the business and its customer.

Personalized e-commerce enables companies to maintain a unique one-to-one relationship with customers and suppliers while capturing the efficiency, affordability and speed of an automated system. Businesses need to track, collect and store Web site visitor information and transfer that information across the enterprise to effectively manage the customer relationship in real-time. We believe that the unique one-to-one relationship established through personalization enhances the experience of a user and likely will result in increased traffic and online commerce. Companies that quickly establish quality one-to-one relationships with online visitors differentiate their services and potentially gain a competitive advantage.

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CHALLENGES PRESENTED BY E-COMMERCE

PROVIDING A COMPREHENSIVE SOLUTION. Creating a comprehensive solution requires integration among many intricate components. In order to deliver a dynamic e-commerce experience, companies must integrate Internet applications with existing content management, customer database, transaction fulfillment and customer support systems. Visitor experience depends directly on a company's ability to execute and support the following difficult and complex activities:

- integrating back office systems with front-end services to fully utilize existing business systems, customer data and information resources;

- attracting, retaining and servicing a broad demographic range of visitors by providing dynamic content, interactive dialogues and communities of interest in a friendly, easy-to-use format;

- developing and maintaining visitor information for tracking and recalling specific interactions in a secure and private environment;

- merchandising services dynamically through personalized content, products and incentives to drive increased user visits and transactions;

- fulfilling transactions with secure e-commerce processes;

- offering a readily accessible and consistent end-user experience across multiple customer touch points, such as call and e-mail centers; and

- managing product and service distribution, including inventory management, product warehousing, order picking and packing, transportation management and product returns.

TIME-TO-MARKET. In the emerging digital economy, where the first-to-market often claims significant competitive advantage, speed is essential. Even if companies have the skilled personnel to implement end-to-end Internet solutions, the actual development and integration of these solutions with existing information systems is a very complex and time-consuming process. Solution design, development and implementation projects frequently range in time from several months to over a year. Such long implementation lead-time can allow competitors the opportunity to claim first mover advantage, become the industry standard and achieve market leadership.

ADVANCED TECHNOLOGICAL SKILL. Providing advanced solutions requires the development, employment and maintenance of leading edge technology and service. Commitment to being a technological leader requires significant investment of resources, both initially and over time, in support functions outside a company's core competence. The diversion of resources from core competencies can be distracting to an organization and may hamper core business execution.

TRAINING AND RETAINING HIGH-COST, HIGHLY-SKILLED PERSONNEL. The availability of high quality professionals experienced in creating, implementing and integrating advanced Internet solutions is limited, making the market extremely competitive for these professionals. As a result, recruiting, training and retaining experienced professionals are increasingly costly. It is often inefficient and difficult for companies seeking to implement their own advanced solutions to hire, train and retain in-house personnel.

HIGH COST TO DEPLOY AND UPGRADE. Building, maintaining and upgrading an Internet commerce platform requires significant initial and ongoing investment. GartnerGroup reports that the average cost to develop and deploy an Internet commerce site was $1.0 million in 1999. Often the total costs of ownership increase significantly due to new technology developments, upgrades and time involved to develop upgrades and modifications. In order to justify the investment, companies need a significant return on investment from B2B and B2C platforms.

Currently, few companies offer the full range of integrated, comprehensive e-commerce services necessary for clients to fully capitalize on their e-commerce potential. Most companies offering outsourced solutions focus on one or just a few specific services, requiring companies to piece together, or find a third party to integrate, these disparate solutions. We believe that few, if any, existing solutions providers offer a comprehensive turn-key and outsourced approach to critical B2B and B2C

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e-commerce services. Further, speed, accuracy and customer experience are essential in the emerging digital economy. Long implementation lead times in the development and integration of e-commerce solutions offer faster and more efficient competitors market advantages. Most businesses cannot afford to divert internal personnel from their core competencies, while it becomes increasingly difficult to obtain and retain highly skilled in-house personnel to implement these advanced solutions.

THE ZENGINE SOLUTION

Zengine addresses the challenges presented by e-commerce by providing a comprehensive suite of technology-based solutions that enable our clients to quickly and cost-effectively create, maintain and enhance their e-commerce presence on an outsourced basis. Our services for both B2B and B2C e-commerce include Web site user interface design, product content and merchandising, personalization and customer relationship management, advertising and sponsorship management, order management, inventory management and order fulfillment, end-user customer service and reporting and analysis. Zengine provides all of these services directly to its clients except for the following services which are provided by third party vendors through Zengine: inventory management and order fulfillment which is performed by MCSi, or other third party vendors, product content and reviews and payment processing.

Our solution enables our clients to:

- ACHIEVE RAPID DEPLOYMENT OF E-COMMERCE PLATFORMS. Our services enable our clients to quickly establish a fully functional e-commerce environment. Our KORE Engine eliminates the need for months of custom programming and reduces the time needed to integrate the e-commerce application with the client's existing computer systems. As a result, our clients are able to drastically reduce their time-to-market. To date, we have enabled our clients to conduct e-commerce within an average of 40 days after the commencement of our services compared to industry ranges of several months to over one year.

- OPERATE A USER-FRIENDLY E-COMMERCE WEB SITE. Our technology and infrastructure provide us with the ability to design and operate a client's e-commerce Web site that is:

- completely integrated with business systems and customer service, including inventory management, technical support, customer interaction by voice or e-mail and product return processing;

- consistent with the look, feel and functionality of our client's existing Web site and brand strategy;

- engaging, intuitive, attractive and easy to use by the Web site visitor;

- fast and reliable, to minimize visitor wait time and to maximize interactivity;

- highly personalized, to improve our client's customer relationships by dynamically identifying, differentiating and interacting with customers on a more personal level; and

- secured by state-of-the-art procedures that enable execution of transactions involving confidential personal and financial data.

- SAVE ON CAPITAL EXPENDITURES AND FOCUS ON CORE COMPETENCIES. Our clients are able to obtain the benefits of e-commerce without making significant time and financial investments in hardware, software and technical and customer service personnel. We generally provide our solutions from our own premises without interfering with our client's daily operations. This permits our clients to focus on their core competencies and to leverage our knowledge, technology and infrastructure.

- BENEFIT FROM OUR INTEGRATED, CONTINUAL IMPROVEMENTS. We are engaged in a constant process of technological enhancement of our services. These improvements include the upgrade of our KORE Engine, new merchandising features and advanced browser-based tools. The architecture of KORE is designed to automatically and without interruption distribute our service improvements to our clients without the need to hire consultants, bring the system offline, or install any client-side software. Upon completion, the feature or tool can be made available to

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other Zengine clients without added development time or costs. Development under the KORE framework contrasts with other e-commerce solutions that provide maintenance and upgrades to custom features on an individual and typically labor intensive basis.

- INCREASE E-COMMERCE REVENUES THROUGH PERSONALIZED CUSTOMER RELATIONSHIP MANAGEMENT. We engage in personalized customer relationship management by attempting to optimize each customer visit to our clients' Web sites through the use of real time interactive marketing and by attempting to resolve customer inquiries and complaints as promptly as possible. Interactive personalization consists of capturing permission based marketing information from implicit and explicit customer behaviors. Examples of visitor information include volunteered data, including purchase history, stated preferences, demographic information and psychographic information and inferred information, including click-stream behavior for predictive modeling. By gathering real time information, we are able to personalize the shopping experience by providing product suggestions, advertisements, incentives and promotions that are likely to be of interest to the visitor. We believe that this personalization of the shopping experience results in a higher user conversion ratio (i.e., the number of visitors who purchase), increased purchases per visit, increased purchase size and greater customer loyalty. This personalized customer relationship management capability allows our clients to use the knowledge they gain of their customers to strengthen relationships, foster customer allegiance and create and sustain a competitive advantage.

Our solutions incorporate the following distinguishing characteristics:

- COMPREHENSIVE--We combine Web site user interface design, product content and merchandising, personalization and customer relationship management, advertising and sponsorship management, order management, inventory management and order fulfillment, end-user customer service and reporting and analysis in one comprehensive suite of services to better ensure accuracy and integration of the entire customer experience.

- HIGH SPEED--All Web site pages served by Zengine are fastloading, regardless of the speed of the user's Internet connection.

- RELIABLE--Our technology is highly reliable, and is designed to provide Web site availability 24 hours a day, 7 days a week and is designed to support online database backups and, if necessary, rapid database restoration.

- SCALABLE--Our services allow our clients to deliver consistent quality of service as transaction volumes grow and to handle daily and seasonal peak periods.

- FLEXIBLE--Our KORE Engine employs highly flexible modeling and tools to facilitate connections between computer applications, including enterprise resource planning, inventory management, call center management, supply chain management and their underlying databases.

- REAL TIME--Our solutions process visitor interactions, inventory availability, order status and other business rules in real time, reducing support costs, bad debt risk and abandoned transactions.

- SECURE--We use state-of-the-art encryption to provide the security and authentication necessary for secure transmission of confidential personal and financial information.

- TRANSPARENT--All visitor interaction occurs on our servers, but appears to the customer to be within our client's Web site. This transparency permits our clients to operate enterprise wide B2B and B2C e-commerce platforms, without the cost of obtaining hardware, software, bandwidth and the associated personnel costs of maintaining the system.

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STRATEGY

Our objective is to capitalize on our proprietary technology and infrastructure, the KORE Engine, to become the leading provider of comprehensive e-commerce enabling services. To accomplish this goal, we are pursuing a strategy built on the following initiatives:

- TARGET COMPANIES SEEKING TO INITIATE, EXPAND OR ENHANCE THEIR ABILITY TO CONDUCT E-COMMERCE. We target our sales and marketing efforts on companies that are focused on establishing or improving their ability to conduct e-commerce yet lack the technical expertise necessary to build and implement desired Internet functionality. These may include original equipment manufacturers, wholesalers, distributors and other businesses that create customized vendor and supply chain relationships, bricks and mortar retailers, pure online retailers and Web sites with a large and loyal user base (including portals, pure content sites, communities, directories and service providers). In order to reach our target customers, we intend to substantially increase our sales and marketing efforts. We believe that penetration into our target market along with increased marketing and trade promotion will establish our brand as the industry standard for outsourced e-commerce solutions.

- EXTEND THE CAPABILITIES OF OUR KORE ENGINE. We intend to extend the capabilities of our KORE Engine through continued investment in its development to provide for additional functionality, extending our use of artificial intelligence, and for vertical applications complementary to our current offerings. We believe that our e-commerce services are the most comprehensive, efficient and personalized real time solutions on the market today. We maintain an open architecture to allow KORE to integrate with major operating systems and technologies as they evolve. We intend to develop additional capabilities through continued internal development and, potentially, through the licensing or acquisition of complementary technologies.

- LEVERAGE CLIENT BASE. One of the distinguishing characteristics of the Zengine business model is the constant level of interaction that Zengine maintains with its clients. This is in sharp contrast to a software solution where the vendor has limited, if any, contact with the client after the installation has been completed. The result is that Zengine has, and will continue to build, a network of clients that it can leverage. As an example, Zengine is currently selling advertising and sponsorship packages on client Web sites to advertisers seeking to efficiently deliver targeted advertising across our network of e-commerce Web sites. Zengine will continue to leverage its network of clients by providing additional services or providing access to its client network. These opportunities may include additional products or services for Zengine to deliver to its network of clients such as relevant content, or may include other opportunities to generate revenue through selling access to its network of clients to outside sponsors or providers.

- EXPAND OUR STRATEGIC ALLIANCES. We currently have strategic business alliances with Excite@Home, United Stationers Supply Co. and MCSi. We plan to continue to develop technology and marketing relationships through strategic alliances with software and systems integrators, consulting firms, advertising firms and other professional services firms. These alliances are intended to complement our direct sales force by providing business leads, increasing our geographic coverage and addressing new industry segments. We also intend to leverage these relationships to commence international sales in countries with high Internet penetration and growth rates.

- ASSIST OUR CLIENTS IN INCREASING THEIR REVENUES USING OUR STATE-OF-THE-ART E-COMMERCE SOLUTIONS. Since our revenues are enhanced by increasing the sales of our client's products through the e-commerce platforms we provide, we intend to enhance the tools our clients use to increase their user to buyer conversion rates, increase the number of products per purchase and the average value of each purchase. Primary tools used in achieving this goal include, increasing the efficiency of our personalization technology and merchandising features, such as development of more robust, real time predictive models. We anticipate that these models will produce higher levels of personalized content and merchandising capabilities.

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ZENGINE SERVICES AND TOOLS

ZENGINE SERVICES

We provide our e-commerce services to clients operating in both B2B and B2C environments. Our business service enables original equipment manufacturers, wholesalers and distributors to conduct personalized supply-chain management and customer transactions over the Internet or secure extranets enabled by Zengine. Our consumer service enables original equipment manufacturers, bricks and mortar retailers, online-only retailers and Web sites with a large and loyal user base, to extend their current business over the Internet.

Our services focus on customer relationship management and can be generally separated into six categories.

- WEB SITE USER INTERFACE DESIGN AND PRODUCT CONTENT. We provide complete Web site and product content creation in conjunction with our clients' brand strategy. We focus our efforts on designing simple and intuitive user-interfaces that leverage rich product content generated by Zengine's content group, by third parties and by our clients. Examples of content features enabled by KORE include product comparisons, product compatibility, related products and accessories and end-user and third party reviews. Comprehensive content and enabling features encourage visitors to make and increase their online purchases.

- MERCHANDISING. We provide comprehensive merchandising features designed to increase the conversion from browser to buyer, retain loyal customers and personalize experiences for one-to-one communication between our clients and their customers. Examples of merchandising features enabled by KORE include personalization, targeting and profiling, top-seller and user rating systems, gift certificates and coupons, outbound communication and reporting and analysis.

Whether within or outside of our client Web sites, we extend our clients' brands to outbound e-mail newsletters and advertising (including banners, buttons, rich media and affiliate marketing). Scheduled for launch this year, we are designing new functionality into KORE that automates our targeted e-mail capabilities. Currently, our marketing personnel personalize and send targeted e-mails based on customer characteristics and preferences.

- ADVERTISING AND SPONSORSHIP MANAGEMENT. As an outsourced solution, part of our service entails the serving of client Web sites. These Web sites may include advertisements and sponsorships which drive the visitor deeper into the client's Web sites. As a result, we sell advertising and sponsorship packages for individual client sites, or across the Zengine network of client e-commerce Web sites as a package. Advertising and sponsorship packages are sold to brand and direct-marketing advertisers seeking to influence targeted visitors within our client e-commerce Web sites.

- ORDER MANAGEMENT. We provide complete order management capabilities for clients in a secure environment. Examples of our order management services enabled by KORE include universal shopping carts and digital wallets, e-mail notifications for account activation, credit card authorizations and settlements, inventory availability, order tracking with major carriers, tax compliance, and fraud protection. We have entered into agreements with VeriSign, Inc. and CyberSource Corporation for credit card processing and advanced fraud screening and protection.

Our order management services include handling all logistics after credit cards have been processed. All orders are processed by secure transactions via the Internet, by phone, by fax, by mail and/or purchase order (where terms are extended to business customers with proper credit history). Our systems provide the ability for both clients and their customers to track the status of orders at any time in real time. This service is transparent to our clients' customers and is seamlessly integrated with our clients' internal and legacy computer systems.

For clients that wish to leverage existing enterprise resource planning (ERP) systems in their e-commerce platform, Zengine provides an open adapter (application programming interface) to KORE that enables seamless connections between a client's legacy computer systems and

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KORE. This direct connection, called KOG (KORE Object Gateway), eliminates redundant or unnecessary human intervention for order management and supports a scalable operation designed for long-term growth. A graphic depiction of KOG follows:

[KOG Graphic

The upper left hand corner of the page contains the following text "KOG (KORE Object Gateway)/Abstraction Layer for Client System Integration with The KORE Engine."

The graphic consists of a series of boxes with arrows pointing to the box on the right, labeled from left to right, as follows:

Box 1: "KORE"; Box 2: "New order," "Send data," "Receive data," "Inventory updates," "User data," "Content," "Client System API (ERP, POS, etc.)" pointing to a gear symbol labeled "KOG" pointing to Box 3 labeled on top "Object Protocol" with interior vertical boxes labeled, from top to bottom, "XML," "ODBC," "EDI," "Flat Text FTP," "Secure E-Mail," pointing to vertical boxes labeled on top "Application Example" with boxes below labeled "Everdream" (connected to the XML box), "JD Edwards" (connected to the ODBC box), "Valley Media" (connected to the EDI box), "MCSi:/Muze" (connected to the Flat Text FTP box) and "rexstores.com" (connected to the Secure E-mail box).

The Zengine logo is in the lower right hand corner of the page.]

- INVENTORY MANAGEMENT AND ORDER FULFILLMENT. On behalf of our clients, we have MCSi pick, pack and ship the client's customer orders and provide customized private label packaging, inserts and promotional literature for distribution with customer orders. Based upon client needs, we are able to take advantage of a variety of shipping and delivery options, including next day service. These services are delivered through our distribution services agreement with MCSi. MCSi, as our agent, receives third party or client inventory at its distribution centers, verifies shipment accuracy, unpacks, inspects for damage and generally stocks for sale the same day. We also utilize the fulfillment services of certain third party wholesalers such as Baker & Taylor, Ingram Micro, Ingram Entertainment, United Stationers and Valley Media. For clients that wish to leverage their existing distribution capabilities, we provide fulfillment messaging directly to the client's back office systems for delivery to their customers. An integral part of our transaction management services also includes the warehousing and distribution of inventory owned by third party vendors or our clients and performed by MCSi.

- END-USER CUSTOMER SERVICE. We provide complete call and e-mail center services to our clients internally and under our distribution services agreement with MCSi. We believe that an important feature of e-commerce is the ability for the end-user to talk with a live customer service representative. Our customer support services utilize features that integrate voice, e-mail, data and Internet chat communications to respond to and handle customer inquiries. Our customer service representatives answer questions in our client's name regarding orders, shipping, billing, returns and product information as well as a variety of other questions. Our customer support center automatically identifies each customer request and routes it to the available customer support representative. Our customer support centers are designed so that our customer service representatives can handle various clients and products, thereby creating economies of scale benefits for our clients.

ZENGINE TOOLS

Our e-commerce services are customized and maintained using Internet-based tools accessible by our personnel and by our clients. These tools, called KIT (KORE Interactive Tool), are accessible through standard Web browser interfaces. KIT provides a set of building blocks comprised of customizable components, application templates and rule sets. (See the inside back cover page of this prospectus for a graphic presentation of KIT.) These tools are instrumental in building, rapidly

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accessing and easily maintaining the Zengine turn-key e-commerce services. A description of our tools follows:

- ZENGINE REPORTING AND ANALYSIS. Our reporting and analysis tools allow both Zengine and our clients to easily analyze customer and operational data. To support this capability, we have designed our reporting and analysis tools to extract and manage data from individual client e-commerce sites. Once our tools have analyzed the data, they present the resulting information in easy-to-use formats, such as graphs and tables. Examples of real time reports include client specific reports, including inventory management, end-user statistics such as end-user behavior, sales trends analysis, per page statistics, references from prior pages and search results analysis; advertising and sponsorship campaign reporting including discount and voucher creation and reporting, e-mail marketing and promotional offer creation and reporting; and call center and customer management reporting, which provides real time customer purchase history, current shopping cart items and past interaction data.

- ZENGINE CONTENT MANAGEMENT. This tool allows a distributed and remote team of non-technical content editors and merchandising experts to collaboratively manage most aspects of site content, including creating, editing, staging, production and archiving. This tool provides personal and shared in-boxes that enable teams of content creators to collaborate in developing content and provides for content previews prior to publishing, to control access to publishing and to capture content classification information. It supports flat content insertion and adds a user-friendly presentation layer to the content by automatically generating HTML within the publisher.

- ZENGINE DESIGN CENTER. We shorten the development cycle by creating simple, intuitive user interfaces for client e-commerce Web sites in conjunction with their overall brand strategies. By outsourcing the task of user interface design to us, our clients are able to focus on other strategic issues involved in launching or retro-fitting their e-commerce operations. We can provide these services either on a full outsourced basis or in collaboration with in-house personnel or other external service providers, such as graphic designers or advertising firms. Our clients have ultimate authority for user interface and look and feel decisions.

- ZENGINE CALL CENTER. This tool displays real-time customer information for call center representatives and general customer service management. Customer purchase history and past interaction data are available to authorized representatives, as well as a customer's current shopping cart items for assistance during checkout. (See the inside back cover page of this prospectus for a graphic presentation.)

CLIENTS

At June 30, 2000, we had 12 e-commerce clients. We currently have 15 e-commerce clients, which include equipment manufacturers, wholesalers, distributors and other businesses that create customized vendor and supply chain relationships, bricks and mortar retailers, pure online retailers and Web sites that have a large and loyal user base (including portals, pure content sites, communities, directories and service providers). In addition, we have placed advertisements for 16 companies, including Epson, Hewlett-Packard, Hitachi, InFocus, Lexmark, Maxell, Proxima, Sharp, Sony and Toshiba. Only MCSi accounted for more than 10% of our total revenue for the nine month period ended June 30, 2000, while Sharp accounted for 9.99% of our total revenue for the period.

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CASE STUDIES

The following case studies are representative of the services we provide our clients.

WORK.COM

CLIENT: Excite@Home is a global media company offering media services through the Excite Web site and narrow and broadband subscription services through @Home for consumers and Work.com, a joint venture between Excite@Home and Dow Jones & Co., a business services and information portal focused on the business professional.

STRATEGIC IMPERATIVE: Excite@Home was preparing to launch the Work.com Web site and recognized the opportunity to leverage the capabilities of its broadband network combined with the retail sales of advanced audio-visual and video conferencing products to its captive visitors on Work.com. The development of the proposed e-commerce site had an aggressive time schedule that could not be realized even by the technology-based company's internal resources. Prior to the launch of the Work.com Web site, Excite@Home invested $2.0 million in Zengine in exchange for an equity interest. For more information, please see "Certain Transactions."

ZENGINE SOLUTION: We launched the Work.com Audio-Visual e-commerce store, the Work.com AV Store, on December 5, 1999, four weeks after initiating development. Running on our servers, but appearing to be a part of the Work.com Web site, the Work.com AV Store offers Work.com's business visitors audio, video, networking, video conferencing, presentation, high speed broadband and broadcast service products and is found at http://AVStore.Work.com.

Our agreement with Excite@Home is representative of our strategy to develop strategic alliances with major industry vendors.

REXSTORES.COM, INC.

CLIENT: rexstores.com is a B2C retailer focusing on the sale of consumer electronics over the Internet. rexstores.com is a wholly-owned subsidiary of REX Stores Corporation, a New York Stock Exchange listed company and a leading retailer of consumer electronics and appliances in small to medium market areas through 238 stores in 35 states. rexstores.com sells its products over its Web site and on major auction sites.

STRATEGIC IMPERATIVE: rexstores.com was searching for a cost-effective way to make its successful retail Web site even more interactive and to personalize the visitor experience in order to increase repeat visits and to increase its conversion (shop/buy) ratios.

ZENGINE SOLUTION: We worked closely with rexstores.com's technical team in redesigning the Web site's user interface and connecting their enterprise resource systems (primarily inventory and distribution) to the KORE Engine. The rexstores.com Web site was re-launched within five weeks of the signing of our agreement and can be found at http://rexstores.com.

Our collaboration with rexstores.com illustrates how Zengine's experienced production and engineering team can work closely with an established group of e-commerce professionals to create significant results-oriented enhancements. Zengine is able to add value to existing online retailers by providing them with collaborative planning and tools to increase the effectiveness of their e-commerce initiatives.

MCSI, INC.

CLIENT: MCSi, our parent corporation, is a systems integration and reseller of state-of-the-art presentation and broadcast facilities, with 1999 annual revenues of over $680 million.

STRATEGIC IMPERATIVE: In a competitive industry, MCSi needs to maintain its strong position, in part, by developing additional sales channels. MCSi recognized that it could significantly enhance its

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distribution by developing an Internet-based method of selling its products to its business clients and to retail consumers. MCSi initially implemented an e-commerce site relying on internal development but quickly realized that we could significantly strengthen its e-commerce efforts through the application of our dedicated technical expertise.

ZENGINE SOLUTION: We have consulted with and designed MCSi's dedicated Web sites to permit MCSi to sell its products over its secure extranet to over 1,000 of MCSi's customers at June 30, 2000. These customers log on to MCSi's Web site, which, based on the work we have performed, appears as a self-branded, personalized e-commerce extranet mirroring the design of the customers' Web site. This B2B service provides authorized client users with the right to purchase specified products from MCSi at preset pricing levels. Under the administrative services agreement, MCSi employees have the flexibility and control to update and maintain this Web site under the guidance of Zengine employees.

MCSi is now able to offer its customers a way to monitor product purchases while at the same time making it convenient and seamless for the customers' employees to obtain the products needed. By serving its clients' extranet pages, MCSi is able to acquire every purchase transaction made by the customer's employees.

SALES AND MARKETING

We market our services through a direct sales force to businesses seeking to initiate, expand or enhance their ability to conduct e-commerce, including original equipment manufacturers, wholesalers, distributors and other businesses that create customized vendor and supply chain relationships over the Internet or a secure extranet, bricks and mortar retailers, online-only retailers and major Internet Web sites with a large and loyal user base (including portals, pure content sites, communities, directories and service providers). Our plan is to continue to pursue these target clients and to penetrate other markets through indirect distribution channels such as consulting firms, systems and integrators, advertising firms and other professional services firms.

Because we do not promote our own brand to the retail public, we do not compete with, and are able to serve as a neutral provider of e-commerce services to, potential and existing clients. This strategy reflects our commitment to each of our clients' brand preservation and exposure. Our marketing efforts are two-fold:

- we promote the value of our outsourced e-commerce services by showcasing our clients' success and leadership; and

- we work cooperatively with clients to promote traffic, revenue and long-term loyalty to their e-commerce platforms.

Our sales activities generally involve meetings with senior management of the prospective client in order to educate them about how our services will fulfill their needs. These meetings also involve a hands-on demonstration of our service capabilities. Because Zengine's brand is "behind the scenes" and because a client usually must make an enterprise-wide, strategic decision as to which company it will choose to operate its B2B e-commerce systems or to operate its B2B e-commerce store or both our sales process typically requires us to compete with a company's in-house solution and with other e-commerce service vendors. As a result, the sales cycle is typically long and unpredictable.

We use a variety of marketing activities to increase market awareness for our services and educate our target audience. In addition to building brand awareness with our potential clients, our marketing activities focus on preparing market research, service offering planning, managing press coverage, identifying potential clients and generating leads to assist in our direct sales efforts. To build awareness and attract new clients we seek leads from our current clients, attend and exhibit at trade shows, build relationships with industry experts to facilitate networking opportunities, and run cooperative independent print advertisements in various newspapers, trade journals and publications. Upon completion of the offering, we intend to greatly expand our marketing efforts by hiring additional

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personnel who will be dedicated to business and market development and public relations, along with increasing our expenditures for direct marketing, promotion and co-marketing arrangements with strategic partners.

An important element of our strategy is to enter into relationships with software and systems integrators, consulting firms, advertising firms, related service providers and other professional service firms to assist us in marketing, selling and delivering our services to potential clients. This approach is intended to increase the potential for lead generation and access to large accounts. We currently have strategic alliances with Excite@Home, MCSi, and United Stationers. Our strategic alliance with Excite@Home is manifested by our service agreement with them and Excite@ Home's investment in us. The strategic alliance with United Stationers provides for us to recommend that our new and existing clients use the services of United Stationer's e-Nited logistics division and that e-Nited recommend our services to their new and existing clients. Our strategic alliance with MCSi is based on our affiliation with MCSi, MCSi's ability to assist us in our marketing efforts by purchasing products from potential clients in the ordinary course of business, the agreements we have to provide e-commerce services to MCSi and MCSi's agreement to provide administrative, distribution and facilities services to us. We are currently seeking to develop additional strategic alliances. We have vendor relationships with AboveNet, Cisco Systems, Cybersource, Oracle, pcOrder, Signio, Sun, Unicast, Verisign, Vertex and Zeus.

TECHNOLOGY AND INFRASTRUCTURE

We believe that our proprietary technology and infrastructure, the KORE Engine, enables us to build, deliver and manage e-commerce solutions in less time, at lower cost and with greater business success than existing alternatives. KORE is a robust architecture that allows existing and custom functionality to be combined in any number of brand iterations seamlessly and with superior efficiencies.

THE KORE ENGINE. Zengine's proprietary technology and infrastructure, the KORE Engine, enables us to build, deliver and manage e-commerce solutions in less time and more cost effectively than existing alternatives. The functional components of KORE are stored on a centralized server array which services all Zengine clients. This architecture minimizes development costs and reduces time-to-market because we are able to leverage existing functionality previously developed within KORE rather than re-engineering the functionality for each application. Upon completion, the component or feature can be made available to other Zengine clients without added development time or cost. Development within the KORE framework significantly differs from other e-commerce solutions that provide maintenance and upgrades to custom features on an individual and possibly labor intensive basis.

KORE PERSONALIZATION. KORE Personalization is the foundation for our real-time, personalized marketing and customer relationship management capabilities. To increase conversion and optimization rates of browsers to buyers, to extend relationship connections between our clients and their customers, and to build long-term brand loyalty, we enable client Web sites to adapt product presentation and merchandising features in real-time based on implicit and explicit visitor information. KORE Personalization applies predictive algorithms to infer a customer's interests and adapts content presentation, such as product features, advertisements and pricing, accordingly. As a customer's experience and interaction with a client's site develops, personalized content becomes more relevant, ultimately bridging a more personal relationship between our client and its customer.

We employ real-time predictive models that compare selected attributes of a customer's purchase history, behavior, demographics and preferences to the attributes of large customer populations in detail. Groups of customers exhibiting attributes similar to the specific customer analyzed are compared to determine the likely preferences of the customer. In calendar year 2000, we plan to introduce customizable personal pages, allowing a client's online customers to personalize the page layout of the

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client's site. This feature will also enable client customers to co-brand the customized layout and operate as an affiliate e-commerce site where other customers can then shop.

NETWORK ARCHITECTURE. KORE resides on a secure, private fault-tolerant network architecture that provides highly reliable service. This is accomplished by distributing Internet traffic across an array of servers that are scalable and redundant. Because of this distributed model, rapid increases in server load can be quickly scaled by allocating more servers to immediately accommodate client Web site demand. In addition, our redundant network architecture allows for unpredictable hardware failure with little effect to service because the failure merely results in the balanced distribution of server load across the server array.

The diagram below depicts a simplified view of our physical network that is co-located at Above/ Net Communications, a subsidiary of Metromedia Fiber Network. Above/Net is a Tier 1 Internet Service Provider with multiple OC-48 capacity, offering clear channel circuits across North America.

[Network Architecture Graphic]

A series of horizontal boxes connected by double-headed arrows, labeled, starting from the top as follows; "ATM Fiber Switch" with an arrow to the right labeled "OC-48" to a cloud shape labeled "Internet Backbone." The ATM Fiber Switch box is separated by an arrow pointing down and labeled "100Mb" to a box labeled "Zengine Router" separated by three arrows pointing to three parallel boxes "Secure Webserver Cluster" separated by three arrows pointing to a box labeled "Zengine Router" separated by three arrows pointing to three parallel boxes labeled "KORE Cluster" separated by three arrows pointing to two short cylinders labeled "Data Center."

Next to the graphic is a box containing the words "Our clients' B2B and B2C e-commerce platforms are served by Zengine from our secure, redundant and fault-tolerant network."

The Zengine logo is in the lower right hand corner of the page.]

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Zengine utilizes distributed and redundant Sun Microsystems Enterprises Server technology operating in conjunction with Zeus 128-bit secure Web servers supported by optimized relational and multi-dimensional databases from MySQL. Since we handle sensitive information (i.e. credit card numbers and personalization data), we adhere to 1024-bit secure socket layer (SSL) encryption to provide the highest level of security available on the market today.

OPEN SOURCE MOVEMENT. In order to maximize both personalization and speed of service, we choose to adhere to open source standards and scalable programming languages. Development within KORE is done in Perl5, a widely accepted standard programming language for developing object-oriented software that is the informed choice for building large-scale e-commerce platforms that require ongoing and rapid development and high-speed dynamically-generated Web site operations. MySQL, an open source database, is optimized for speed and scalability and serves as the foundation for KORE's personalized capabilities. KORE creates multiple database connections for multiple actions both efficiently and quickly, resulting in high-speed dynamic Web site delivery.

The design of our KORE Engine, KOG, KIT and network architecture enables us to provide rapid, cost-effective and reliable e-commerce solutions by exploiting the scalability of open source technologies and multi-processor, shared memory computers.

PRODUCT DEVELOPMENT

We believe our future success will depend in large part on our ability to enhance the KORE Engine, develop new products, maintain technological leadership, and satisfy an evolving range of customer requirements. Our product development group is responsible for implementing and integrating KORE into our client's Web sites and business practices, developing content and the user interface of our client's Web sites, product testing and quality assurance, and writing product user documentation. In addition, this group supports post-sale and client account management activities.

We are currently developing the following products and features, all of which are scheduled to be available in calendar year 2000.

- KORE PERSONALIZATION FEATURES--Key features of the next update to the KORE Engine will utilize more robust real-time predictive models that we anticipate will yield a higher degree of relevant content. Later in calendar year 2000, we plan to implement artificially intelligent systems that will allow for greater one-to-one personalization across all e-commerce environments and customer touch-points.

- ENHANCED MERCHANDISING FEATURES--We constantly strive to create more compelling features that in turn add usability to client e-commerce sites. For example, "Recurring Purchases" enables customers to set advance schedules for purchase of products based on consumption or scheduling. This feature also serves as a data collection point with calendar and reminder features.

- ADVANCED TOOLS--Our services are customized and maintained using KIT, browser-based tools easily accessed by our clients via standard Internet browsers. We will be launching enhancements to our Reporting and Analysis, Content Management and Design Center Tools to further enable our product development personnel and our clients to enhance the customization of user interfaces, and analysis of traffic, buying habits and trends.

COMPETITION

The market for our services is intensely competitive and subject to rapid technological change. We expect competition to intensify in the future. Our primary source of competition comes from companies who develop their own custom e-commerce systems or purchase software packages and hire consultants

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to implement these solutions. Because these companies have likely made significant initial investments to develop their custom systems, they may be less likely to employ outsourced transaction processing strategies. We also face competition from companies such as Art Technology Group, Breakaway Solutions, Broadvision, E.piphany, Net Perceptions and USinternetworking. In addition, other companies may enter the market to provide similar services.

Many of our competitors have longer operating histories, substantially greater financial, technical, marketing or other resources, or greater name recognition than we do. Our competitors may be able to respond more quickly than we can to new or emerging technologies and changes in customer requirements. Competition could seriously impede our ability to sell additional services on terms favorable to us. Our current and potential competitors may develop and market new technologies that render our existing or future services obsolete, unmarketable or less competitive. Our current and potential competitors may make strategic acquisitions or establish cooperative relationships among themselves or with other e-commerce solution providers or fulfillment companies, thereby increasing the ability of their services to address the needs of our prospective customers. Competitive pressures could reduce our market share or require the reduction of the prices of our services, either of which could materially and adversely affect our business, results of operations or financial condition.

We compete on the basis of certain factors, including:

- technology;

- time-to-market;

- breadth of service features and functionality;

- ease of implementation;

- speed, accessibility and ease of use;

- brand recognition;

- price;

- system reliability and capacity; and

- customer support.

We believe that we presently compete favorably with respect to each of these factors. However, the market for our services is still rapidly evolving, and we may not be able to compete successfully against current and potential competitors.

INTELLECTUAL PROPERTY

Our ability to compete depends to a large degree upon our proprietary technology. Our success depends on protecting our intellectual property, which, next to our employees, is our most important asset. If we do not adequately protect our intellectual property, our business, financial condition and results of operations could be seriously harmed. We rely on a combination of trademark and trade secret rights, confidentiality procedures, licensing arrangements and contractual restrictions to establish and protect our proprietary rights. These legal provisions afford only limited protection for our technology. Our source code for our proprietary software is protected as a trade secret. We have not applied for a patent for our KORE Engine and have not decided whether to do so in the future, since the source code would be publicly revealed upon receipt of any patent. Even if we filed a patent application, we could not assure you that a patent would be issued.

We have applied to register our trademarks, such as the Zengine name, the Zengine "gear" logo, "KORE," "KOG," our tag line "Fueling Your Brand's Commerce Engine" and "Commerce Engine." However, we cannot assure you that effective trademark protection will be available for our marks. We

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have identified another company that is using the KORE name. We have demanded that this company stop using our proprietary name. We cannot assure that we will be successful in these efforts. It is possible that others will adopt product names or logos similar to KORE or the Zengine gear logo. This would impede our ability to build our brand identity, lead to customer confusion, increase our legal expenses and distract management from the operation of our business.

Finally, we seek to avoid disclosure of our intellectual property by requiring employees and consultants with access to our proprietary information to execute confidentiality agreements with us and by restricting access to our source code. Due to rapid technological change, we believe that factors such as the technological and creative skills of our personnel, new product developments and enhancements to existing products are more important than the various legal protections of our technology to establishing and maintaining a technology leadership position.

Despite our efforts to protect our proprietary rights, unauthorized parties may attempt to copy aspects of our services or to obtain and use information that we regard as proprietary. Policing unauthorized use of our software is difficult and while we are unable to determine the extent to which piracy of our software exists, if at all, software piracy can be expected to be a persistent problem. Litigation may be necessary in the future to enforce our intellectual property rights, to protect our trade secrets, to determine the ability and scope of the proprietary rights of others or to defend against claims of infringement or invalidity. However, the laws of many countries do not protect our proprietary rights to as great an extent as do the laws of the United States. Any such resulting litigation could result in substantial costs and diversion of resources and could seriously harm our business, operating results and financial condition. We cannot assure you that our means of protecting our proprietary rights will be adequate or that our competitors will not independently develop similar technology. Any failure by us to meaningfully protect our property could have a material adverse effect on our business.

To date, we have not been notified that our products infringe the proprietary rights of third parties, but we cannot assure you that third parties will not claim infringement with respect to our current or future services or technology. Because the e-commerce industry is relatively new, patents relating to the industry are only now starting to be issued by the U.S. Patent and Trademark Office. These patents are protecting certain business processes which many in the industry currently believe are not proprietary. We expect that developers of Web-based commerce products and services will increasingly be subject to infringement claims as the number of products, services and competitors in our industry segment grows and as the functionality of products in different segments of the industry increasingly overlaps. Any such claims, with or without merit, could be time-consuming to defend, result in costly litigation, divert management's attention and resources, cause delays or require us to enter into royalty or licensing agreements. Such royalty or licensing agreements, if required, may not be favorable or acceptable to us. A successful claim of infringement against us and our failure or inability to license the infringed technology or develop or license technology with comparable functionality could harm our business. See "Risk Factors--Risks Related to Our Business--We have no patent on the KORE Engine and we may not be able to adequately protect our proprietary rights."

We integrate third party software into software we use to perform our services. This third-party software may not continue to be available on commercially reasonable terms. We license Internet fraud screen from CyberSource Corporation and payment processing capabilities from Verisign, Inc. If we cannot maintain licenses to this third-party software, implementation of our services could be delayed until equivalent software could be developed or licensed and integrated into our products, which could materially adversely affect our business.

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FACILITIES

Our primary offices are located in approximately 17,900 square feet of space in Fremont, California under a sublease with MCSi expiring on May 1, 2001. For more information regarding this sublease, refer to the section titled "Certain Transactions."

EMPLOYEES

As of June 30, 2000, we had a total of 43 full time and 2 part time employees, and 6 MCSi employees provide full time, and 15 MCSi employees provide part time, services to us under the Administrative Services Agreement. Of our total employees (including those of MCSi), 10 are in management, 25 are in technology/engineering, 21 are in merchandising/content, and 10 persons are in sales/marketing, for a total of 66. Our future success will depend, in part, on our ability to attract, retain and motivate highly qualified technical sales and management personnel, for whom competition is intense. None of our employees is represented by a labor union, and we have never experienced a work stoppage. We consider employee relations to be good.

LEGAL PROCEEDINGS

We are not a party to any material legal proceedings.

REGULATION

As e-commerce and the Internet continue to evolve, federal, state and foreign governments may adopt laws and regulations covering issues such as user privacy, taxation of goods and services provided over the Internet, pricing, content and quality of products and services. If enacted, these laws and regulations could limit the market for e-commerce, and therefore the market for our services. Although many of these regulations may not apply directly to our business, we expect that laws regulating the solicitation, collection or processing of personal or consumer information could indirectly affect our business.

The Telecommunications Act of 1996 prohibits certain types of information and content from being transmitted over the Internet. The prohibition's scope and the liability associated with a Telecommunications Act violation are currently unsettled. The imposition upon us and other service providers of potential liability for information carried on or disseminated through our applications could require us to implement measures to reduce our exposure to this liability. These measures could require us to expend substantial resources or discontinue certain services. In addition, although substantial portions of the Communications Decency Act (the Act through which the Telecommunications Act of 1996 imposes criminal penalties) were held to be unconstitutional, similar legislation may be enacted and upheld in the future. It is possible that this legislation could expose companies involved in e-commerce to liability, which could limit the growth of e-commerce generally. Legislation like the Telecommunications Act and the Communications Decency Act could dampen the growth of Internet usage and decrease its acceptance as a communications and commercial medium.

Our applications utilize encryption technology, the export of which is regulated by the United States government. We currently do not provide our services to clients located outside the United States, but intend to begin marketing to foreign companies (or companies who reach foreign markets) in calendar year 2000. Export regulations, either in their current form or as may be subsequently enacted, may limit our ability to provide our services outside the United States. Moreover, federal or state legislation or regulation may further limit levels of encryption or authentication technology that we are able to utilize. While we will take precautions against unlawful exportation of our software, the global nature of the Internet makes it difficult to effectively control the distribution of software. Any unlawful exportation of our software, or adoption of new legislation or regulation relating to

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exportation of software and encryption technology could have a material adverse effect on our business, financial condition, and operating results.

The Internet Tax Freedom Act bars state and local governments from imposing taxes on Internet access or that would subject buyers and sellers of e-commerce to taxation in multiple states. This act is in effect through October 2000. When the act expires or if the act is repealed, Internet access and sales across the Internet may be subject to additional taxation by state and local governments, thereby discouraging purchases over the Internet and adversely affecting the market for our services. On May 10, 2000, the U.S. House of Representatives passed the Internet Nondiscrimination Act of 2000 which amends the Internet Tax Freedom Act to prohibit, until October 2006, a state from imposing taxes on Internet access and multiple or discriminatory taxes on electronic commerce.

One of the principal features of our proprietary technology is the ability to identify users who visit our clients' Web sites and to develop and maintain highly personalized profiles of users to assist our clients in determining the nature of the content and the product offerings to be provided to that customer. Typically, users are identified through the use of "cookies" and other non-personally-identifiable information. Profiles are captured when customers visit a site on the Web and volunteer information in response to survey questions concerning their backgrounds, interests, and preferences, with prior notice, and the opportunity for a user to opt-out of such targeting and collection. Profiles are augmented over time through the collection of usage data. Privacy concerns may cause users to resist providing the personal data necessary to support this profiling capability. The perception by our clients' customers or potential customers of substantial security and privacy concerns, whether or not valid, may inhibit market acceptance of our technology. Such concerns also may be heightened by legislative or regulatory requirements that require notification to Web site users that the data captured as a result of visitation of certain Web sites may be used by marketing entities to unilaterally address product promotion and advertising to that user.

We are subject to various federal and state regulations concerning the collection and use of information regarding individuals who access Web sites. These laws include the Children's Online Privacy Protection Act, federal and state consumer credit laws, as well as other laws that govern the collection and use of consumer information. Since many of the proposed laws or regulations are just being developed, and a consensus on privacy and data usage has not been reached, we cannot yet determine the impact these regulations may have on our business. In addition, the U.S. Congress, a number of state governments and various trade organizations and industry groups have recently proposed limitations on the collection and use of information regarding Internet users. Although our compliance with applicable federal and state laws, regulations and industry guidelines has not had a material adverse effect on us, if governments, trade associations and industry self-regulatory groups enact more burdensome laws, regulations and guidelines relating to consumer privacy, its could materially and adversely affect our business, financial condition and results of operations.

Certain consumer activist groups have recently sought to have the Federal Trade Commission determine whether profiling should be considered "subliminal" marketing which they believe should be prohibited. While we are not aware of any law or regulation which prohibits subliminal marketing, the FTC has, in the past, considered such acts to be deceptive trade practices and has issued administrative cease and desist orders against companies using those techniques. The FTC has recently begun an informal inquiry into the business practices of an Internet marketing and advertising company that uses personalization techniques to target advertisements to people who browse certain Web sites. That company is also currently defending itself against seven private lawsuits alleging, among other things, the improper collection and use of personal information in violation of federal and state statutes and the right of privacy. In addition, the Attorney General's Office of the States of New York and Michigan have requested that this company provide certain information concerning its business practices. Zengine is not involved in any similar investigation or litigation. However, if the privacy concerns of consumers are not adequately addressed, our business could be harmed.

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MANAGEMENT

DIRECTORS, EXECUTIVE OFFICERS AND KEY EMPLOYEES

The following table sets forth information regarding our directors and executive officers as of June 30, 2000.

NAME                                     AGE                             POSITION
----                                   --------   -------------------------------------------------------
Michael E. Peppel....................     33      Chairman of the Board
Joseph M. Savarino...................     30      President, Chief Executive Officer and Director
Louis T. Lipinski....................     33      Vice President, Chief Financial Officer, Treasurer and
                                                  Secretary
Lalit P. Dhadphale...................     28      Vice President of Product Development and Chief
                                                  Operating Officer
Christopher R. Feaver................     23      Vice President and Chief Technology Officer
Christopher R. Lunt..................     28      Vice President of Engineering
Anthony W. Liberati..................     68      Director
Donald B. Hutchison..................     46      Director
Richard V. Hopple....................     53      Director
Stacey Snider........................     39      Director

MICHAEL E. PEPPEL has served as our Chairman of the Board since March 1999 and has also served as the Chairman of the Board of MCSi, a publicly traded solutions based reseller and integrator of audio-visual products and reseller of computer technology products and services, since February 2000 and President and Chief Executive Officer of MCSi since January 1998. He served as Chief Financial Officer of MCSi from May 1996 until December 1997. Prior to joining MCSi, he was a Director and Chief Financial Officer of Diversified Data Products, Inc., Ann Arbor, Michigan, a computer supply reseller, from 1990 until May 1996. Prior thereto, he was a money desk manager of the DeBartolo Corporation, Youngstown, Ohio. Mr. Peppel received his BA degree from the University of Notre Dame.

JOSEPH M. SAVARINO has served as our President since March 1999 and as our Chief Executive Officer since January 2000. Mr. Savarino became a director of Zengine in March 1999. Prior to Zengine, he was the Director, Western U.S. Sales, from November 1998 to February 1999, at Unicast Communications, an online advertising technology firm, and the Western Region Sales Manager from October 1997 to November 1998, for INTERVU, Inc., a publicly traded streaming audio and video solutions provider, which was purchased by Akamai, Inc. on April 20, 2000. From December 1995 to October 1997, Mr. Savarino served as Business Development Manager of Sumikin Bussan (Sumitomo Metals Group), an international commodities trading company. Prior thereto, he was a Senior Analyst for The Martec Group, an international technical market research firm. Mr. Savarino received his BA degree from the University of Michigan, Ann Arbor.

LOUIS T. LIPINSKI has served as our Vice President, Chief Financial Officer, Treasurer and Secretary since January 2000. Prior to joining Zengine, he was the Mergers and Acquisitions Analyst at MCSi from February 1998 until December 1999. Mr. Lipinski attended the Graduate School of Business at the University of Chicago from September 1995 until his graduation in May 1997. Prior thereto, he was a financial consultant with Comerica Bank from June 1994 to August 1995 and with Merrill Lynch & Co. from March 1993 to June 1994. From October 1990 to February 1993, Mr. Lipinski was an independent futures trader on the Chicago Mercantile Exchange. Mr. Lipinski received his MBA from the University of Chicago and his BA degree from the University of Notre Dame. Mr. Lipinski is also a certified public accountant.

LALIT P. DHADPHALE has served as our Vice President of Product Development since March 1999 and as Chief Operating Officer since January 2000. He served as a director of Zengine from May 1999 to

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January 2000. Mr. Dhadphale was a producer of Excite Japan from July 1997 until March 1999, where he was involved with product development, internationalization and localization of Web sites and Internet products. He also produced the launch of Netscape Netcenter Japan. From December 1996 to July 1997, Mr. Dhadphale was a member of CNET's international business development team that secured relationships throughout Asia and the Pacific Rim. Prior thereto, he was the New Media Development Manager for P.O.V. Associates from July 1995 to November 1996 and an Account Executive for the American Chamber of Commerce in Tokyo, Japan from January 1995 to June 1995. Mr. Dhadphale received his BA degree from the University of Michigan, Ann Arbor.

CHRISTOPHER R. FEAVER has served as our Chief Technology Officer since March 1999 and as Vice President since January 2000. Mr. Feaver served as a director of Zengine from May 1999 to January 2000. Prior to Zengine, Mr. Feaver was a lead software engineer for Excite@Home, Inc., where he was employed from July 1997 to February 1999. During his Excite tenure, Mr. Feaver fulfilled various roles, including systems engineering lead, network operations, production engineering and software engineering. In 1998, he co-founded and was an officer and principal stockholder of Silicon Valley Web Hosting Inc., a private fully scalable, redundant hosting environment for high bandwidth and broadband Web sites. From January 1995 to July 1996, he served as a Software Engineer for Internet Media Services. Mr. Feaver attended the University of California, Santa Cruz.

CHRISTOPHER R. LUNT has served as our Vice President of Engineering since November 1999. Prior to joining Zengine, he was an Engineering Manager and Team Leader at Excite@Home from August 1997 to October 1999. Prior to his Excite@Home tenure, Mr. Lunt was a Senior Software Engineer at Oracle Corporation from August 1993 to August 1997. Mr. Lunt received his BA degree from the University of Michigan, Ann Arbor.

ANTHONY W. LIBERATI has been a director of Zengine since March 1999. He was the Chairman of the Board of MCSi from May 1996 until his retirement in February 2000. Commencing in 1982 and until his retirement in August 1995, Mr. Liberati was employed by the Edward J. DeBartolo Corporation, Youngstown, Ohio, the nation's largest shopping center developer and the owner of the San Francisco 49ers professional football team. At the time of his retirement, Mr. Liberati was the Chief Operating Officer of the DeBartolo Corporation. Prior to his appointment as the Chief Operating Officer, he was the DeBartolo Corporation's Chief Financial Officer for ten years. Mr. Liberati is a director of Hawthorne Financial Corporation, Los Angeles, California, a savings institution holding company which is traded on the Nasdaq National Market, and First Fidelity Bancorp, Irvine, California, a privately held thrift and loan holding company and is a former member of the Board of Directors of DeBartolo Realty Corporation, Youngstown, Ohio, which was a New York Stock Exchange-traded real estate investment trust until its merger into Simon Property Group, Inc. in November 1996. He is a current member of the Board of Directors of Imperial Land Company, Pittsburgh, Pennsylvania, a privately held land-bank company, Quality Aggregates, Inc., Pittsburgh, Pennsylvania, a privately held materials supply company, and a former member of the Board of Directors of Pennsylvania Capital Bank, Pittsburgh, Pennsylvania, a privately held Pennsylvania commercial bank. He attended Duquesne University, Pittsburgh, Pennsylvania.

DONALD B. HUTCHISON has been a director of Zengine since April 2000. Mr. Hutchinson is the Chairman and Chief Executive Officer of Work.com, a business services and information portal focused on the business professional which is a joint venture between Dow Jones & Co. and Excite@Home. Prior thereto, he was Senior Vice President and General Manager of Excite@Home, a position he held from February 1997 to February 2000. Prior to joining Excite@Home, he was the Senior Vice President of Netcom from May 1994 to August 1996. Mr. Hutchison received his BA degree from University of California at Santa Barbara and his MBA from Loyola Marymount University.

RICHARD V. HOPPLE has been a director of Zengine since April 2000. Since 1996, Mr. Hopple has been the Chairman of the Board and Chief Executive Officer of Unicast Communications, Inc., New

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York, New York, a privately held Internet advertising company. Prior thereto, Mr. Hopple was the President of D'Arcy Masius Benton & Bowles North America for one year and Vice Chairman for three years. Prior thereto, Mr. Hopple was President of Wells Rich Greene. Mr. Hopple is a director of the Internet Advertising Bureau, the American Rivers Foundation and the City Center 55th Street Theatre Foundation, Inc. in New York City. Mr. Hopple received his BA degree from Northwestern University.

STACEY SNIDER has been a director of Zengine since April 2000. She is the Chairman of Universal Studios, Inc., a subsidiary of the Seagram Company, Ltd., where she is responsible for all production, marketing and domestic distribution for the studio. From November 1998 to November 1999, Ms. Snider served Universal as President, Production, was promoted to head of production in April 1998 and was appointed as co-President, Production in December 1996. Ms. Snider joined Universal from TriStar Pictures where she had served as President, Production since January 1992. Ms. Snider received her BA degree from the University of Pennsylvania and her Juris Doctor degree from the University of California at Los Angeles.

BOARD STRUCTURE AND COMMITTEES

Under the amended and restated certificate of incorporation, our board of directors will be divided into three classes serving staggered terms. Directors in each class will be elected to serve for three-year terms and until their successors are elected and qualified. Each year, the directors of one class will stand for election as their terms of office expire. Presently, Mr. Hutchison and Ms. Snider are designated as the Class I directors, with their terms of office expiring in 2001; Messrs. Hopple and Liberati are designated as Class II directors, with their terms of office expiring in 2002; and Messrs. Savarino and Peppel are designated as Class III directors, with their terms of office expiring in 2003.

We have three standing committees: an executive committee, an audit committee and a compensation committee. Messrs. Peppel, Savarino and Liberati have been appointed as the initial members of the executive committee. Messrs. Liberati and Hopple and Ms. Snider have been appointed as the initial members of the audit committee. Messrs. Liberati, Hopple and Hutchison have been appointed as the initial members of the compensation committee.

The executive committee generally has the authority to act as the board of directors when the board is not in session, subject to certain exceptions contained in the Delaware General Corporation Law. Actions of the executive committee may be taken upon the affirmative vote of any two of the three members of the committee, provided that one of the committee members so acting must be a non-employee director. Executive committee decisions must be ratified by the board of directors at its next regularly scheduled meeting. The audit committee will select the independent public accountants to audit our annual financial statements and will establish the scope and oversee the annual audit. The compensation committee will determine the compensation for employee directors and, after receiving and considering the recommendation of our president and chief executive officer, all officers of the company and any other employee that the compensation committee may designate from time to time and will approve and administer employee stock option and incentive plans. Our board of directors may establish other committees from time to time to facilitate the management of the business and affairs of our company.

NON-EMPLOYEE DIRECTOR COMPENSATION

Each non-employee director receives a fee of $1,000 for each meeting of the board of directors or a board committee which he or she attends, plus his or her expenses related to attendance. Non-employee directors will receive an initial grant of stock options to purchase 12,000 shares of common stock under the 1999 Stock Option Plan upon the closing of the initial public offering with an

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exercise price per share equal to the initial public offering price. Non-employee directors are also eligible to receive future discretionary grants under the plan. Directors who are also employees of Zengine receive no payment for serving as directors or committee members.

EXECUTIVE COMPENSATION

The following table sets forth certain compensation information for our chief executive officer and our four other most highly compensated executive officers for services rendered in all capacities to Zengine during the year ended September 30, 1999. These executives are referred to as the named executive officers in this prospectus.

SUMMARY COMPENSATION TABLE

                                                                          LONG-TERM COMPENSATION
                                                  ANNUAL          --------------------------------------
                                               COMPENSATION                    SECURITIES
                                            -------------------     STOCK      UNDERLYING    ALL OTHER
NAME AND PRINCIPAL POSITION                  SALARY     BONUS     AWARDS($)    OPTIONS(#)   COMPENSATION
---------------------------                 --------   --------   ----------   ----------   ------------
Joseph M. Savarino........................  $48,461       --      $60,000(1)         --           --
  PRESIDENT, CHIEF EXECUTIVE OFFICER AND
  DIRECTOR
Lalit P. Dhadphale........................   45,000       --       60,000(1)         --           --
  VICE PRESIDENT OF PRODUCT DEVELOPMENT
  AND CHIEF OPERATING OFFICER
Louis T. Lipinski.........................       --       --           --        67,686           --
  VICE PRESIDENT, CHIEF FINANCIAL OFFICER,
  TREASURER AND SECRETARY
Christopher R. Feaver.....................   48,461       --       60,000(1)         --           --
  VICE PRESIDENT AND CHIEF TECHNOLOGY
  OFFICER
Christopher R. Lunt.......................       --       --           --       135,372           --
  VICE PRESIDENT OF ENGINEERING


(1) Represents the grant of 676,860 shares of restricted stock, which had a fair market value of $60,000 on the date of grant and at September 30, 1999. One-third (225,620) of the shares vested immediately upon grant in March 1999 and 34,711 shares vest each calendar quarter thereafter (the remainder of the unvested shares will vest upon completion of this offering).

Messrs. Savarino, Dhadphale and Feaver are subject to employment agreements which provide each of them an annual salary of $90,000. For more information, please see "Employment Agreements." During fiscal 1999, Mr. Lipinski was employed by MCSi and he did not become an employee of ours until January 1, 2000. Mr. Lunt joined Zengine on November 1, 1999 at an annual salary of $100,000.

EMPLOYMENT AGREEMENTS

We have entered into multi-year employment agreements with Joseph Savarino, our President and Chief Executive Officer, Christopher Feaver, our Chief Technology Officer, and Lalit Dhadphale, our Vice President of Product Development and Chief Operating Officer. Each employment agreement is substantially the same and provides for the following:

- a three year term which ends in March 2002, with automatic one-year renewals;

- $90,000 annual base salary;

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- 676,860 restricted shares of our common stock, of which 225,620 shares vested upon execution of the employment agreement and 34,711 shares which vest each calendar quarter; upon a change in control of our company, which is defined to include the completion of this offering, the restricted shares will immediately vest;

- participation in any benefit or retirement plans offered by us;

- severance pay under certain circumstances which is capped at $14,795;

- an agreement to keep our proprietary information confidential during the term of the employment agreement and for a period of seven years following termination of the employment agreement; and an agreement to not compete with us in an area within a 75 mile radius of any existing office of ours or MCSi during the term of the employment agreement and for twelve months following March 1, 2002; and

- indemnification by us of the executive for actions in which the executive is made a party or is otherwise involved by reason of being or having been a director, officer, employee or agent of Zengine, MCSi or any affiliates of either.

1999 STOCK OPTION PLAN

The Amended and Restated 1999 Stock Option Plan provides for the grant of stock options to all employees and directors of our company, our subsidiaries and of MCSi who are eligible to participate. The purpose of the 1999 Stock Option Plan is to further our growth, development and financial success by providing incentives to our employees and non-employee directors and employees of our parent corporation, MCSi, by assisting them to become owners of our common stock. An aggregate of 3,384,300 shares of common stock are reserved for issuance to employees and directors under the 1999 Stock Option Plan.

The 1999 Stock Option Plan is administered by a committee of our Board of Directors (the "1999 Stock Option Committee"). The 1999 Stock Option Committee consists of two or more directors, appointed by our board of directors, who are "non-employee directors," as defined in Rule 16b-3 under the Securities Exchange Act of 1934, and "outside directors," as defined in Section 162(m) of the Internal Revenue Code. The 1999 Stock Option Committee has complete authority and discretion to determine from among eligible persons those to whom options will be granted and the number and terms of such options. The current members of the 1999 Stock Option Committee are Mr. Liberati, Mr. Hutchison and Mr. Hopple.

The 1999 Stock Option Plan provides for the granting of both incentive stock options and non-qualified stock options under the Internal Revenue Code. Non-employee directors are eligible to receive only non-incentive stock options under the plan. The exercise price of incentive stock options granted under the 1999 Stock Option Plan may not be less than 100% of the fair market value on the date of the grant, except that incentive stock options granted to individuals owning more than ten percent of the total combined voting power of Zengine may not have an exercise price less than 110% of the fair market value on the date of grant. The exercise price of non-qualified stock options is established by the 1999 Stock Option Committee. Unless otherwise provided for by the 1999 Stock Option Committee or our Board of Directors, and set forth in the individual stock option agreements, stock options under the 1999 Stock Option Plan vest over four years, with 25% vesting one year from the date of grant and 6.25% vesting each calendar quarter thereafter. Unless otherwise provided for by the 1999 Stock Option Committee or our Board of Directors, stock options issued under the 1999 Stock Option Plan immediately vest and become exercisable upon the option holder's death, disability or upon a change of control of Zengine, as defined in the 1999 Stock Option Plan.

Payment of the exercise price of a stock option may be made in cash, shares of common stock, or by any other method approved by the 1999 Stock Option Committee, consistent with Section 422 of the

54

Code and Rule 16b-3 under the Exchange Act. Incentive stock options are not assignable or transferable except by will or the laws of descent and distribution, and, during the participant's lifetime, may be exercised only by the participant. However, an optionee may transfer non-qualified stock options to his or her spouse, lineal ascendants, lineal descendants, or to a duly established trust for the benefit of one or more of these individuals.

At the time of any merger, consolidation, reorganization, recapitalization, stock dividend, stock split, or other change in the corporate structure or capitalization affecting our common stock, appropriate adjustments to the exercise price, number and kind of shares to be issued under the 1999 Stock Option Plan and any outstanding options will be made. Unless terminated earlier, the 1999 Stock Option Plan will terminate ten years from its adoption, and no stock options will be granted after the 1999 Stock Option Plan terminates. Our board of directors has the authority to amend, modify, suspend or terminate the 1999 Stock Option Plan at any time, subject to any requirement of stockholder approval under the Internal Revenue Code or other applicable law or rule of the Nasdaq Stock Market, and, if applicable, approval by an optionee whose options would be adversely affected by the change.

There are currently an aggregate of 1,380,118 options outstanding under the 1999 Stock Option Plan at a weighted average exercise price of $.89 per share.

GRANT OF ZENGINE STOCK OPTIONS IN FISCAL 1999

The following table sets forth information with respect to grants of stock options to purchase shares of our common stock during fiscal 1999 to the named executive officers reflected in the Summary Compensation Table. All options were granted under our 1999 Stock Option Plan.

                                                                                                                 POTENTIAL
                                                           INDIVIDUAL GRANTS                                  REALIZABLE VALUE
                                            -----------------------------------------------                      AT ASSUMED
                                                         % OF TOTAL                 DEEMED                    ANNUAL RATES OF
                                            NUMBER OF      OPTIONS                  VALUE                       STOCK PRICE
                                            SECURITIES   GRANTED TO                  PER                      APPRECIATION FOR
                                            UNDERLYING    EMPLOYEES    EXERCISE     SHARE                       OPTION TERM
                                             OPTIONS       IN LAST     PRICE PER   ON DATE    EXPIRATION   ----------------------
NAME                                         GRANTED     FISCAL YEAR     SHARE     OF GRANT      DATE         5%           10%
----                                        ----------   -----------   ---------   --------   ----------   --------      --------
Joseph M. Savarino........................        --          --            --         --            --         --            --
Lalit P. Dhadphale........................        --          --            --         --            --         --            --
Louis T. Lipinski.........................    67,686         6.0%        $0.08      $0.09      09/01/09     $4,700       $10,500
Christopher R. Feaver.....................        --          --            --         --            --         --            --
Christopher R. Lunt.......................   135,372        12.0%        $0.08      $0.09      09/01/09     $9,400       $21,000

AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION VALUES

None of the named executive officers have exercised options to purchase shares of our common stock. The following table describes the value of exercisable and unexercisable options held by the named executive officers as of September 30, 1999.

The "Value of Unexercised In-the-Money Options at September 30, 1999" is based on a value of $0.09 per share, the deemed fair market value of our common stock on that date, less the per share

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exercise price, multiplied by the number of shares issuable upon exercise of the option. All options were granted under our 1999 Stock Option Plan.

                                    NUMBER OF SECURITIES
                                   UNDERLYING UNEXERCISED      VALUE OF UNEXERCISED IN-THE-
                                         OPTIONS AT                  MONEY OPTIONS AT
                                     SEPTEMBER 30, 1999             SEPTEMBER 30, 1999
                                 ---------------------------   -----------------------------
NAME                             EXERCISABLE   UNEXERCISABLE   EXERCISABLE    UNEXERCISABLE
----                             -----------   -------------   ------------   --------------
Joseph M. Savarino.............       --               --            --               --
Lalit P. Dhadphale.............       --               --            --               --
Louis T. Lipinski..............       --           67,686            --           $  900
Christopher R. Feaver..........       --               --            --               --
Christopher R. Lunt............       --          135,372            --           $1,800

EMPLOYEE STOCK PURCHASE PLAN

We have adopted the 2000 Employee Stock Purchase Plan which will become effective upon the completion of this offering. The Stock Purchase Plan provides employees with the opportunity to purchase shares of our common stock on a regular basis. The purpose of the Stock Purchase Plan is to contribute to our growth and profitability by allowing our employees to purchase common stock which will provide them with an incentive to work towards the success of Zengine. The Stock Purchase Plan is intended to qualify as an employee stock purchase plan within the meaning of Section 423 of the Internal Revenue Code. Pursuant to the plan, shares of common stock will be offered to employees of Zengine in up to two phases known as "offering periods" during which payroll deductions will be accumulated under the plan during any calendar year. Generally, there will be two six month offering periods each year. An employee shall elect to make contributions to the plan by payroll deductions in an aggregate amount up to 15% of such employee's total compensation. Employees may not make any separate cash payment to purchase shares pursuant to the plan. On the first business day of each offering period, Zengine will grant to each eligible employee who is then a participant in the plan an option to purchase shares of the common stock at an option price determined by the committee, which shall not be less than eighty-five percent (85%) of the lesser of (a) the fair market value of the shares on the first business day of an offering period, or
(b) the fair market value of the shares on the last business day of such offering period. Shares are purchased on the last day of the offering period. The common stock purchasable under the Stock Purchase Plan may be shares of authorized but unissued shares, treasury shares or shares purchased by Zengine on the open market or from private sources for use under the Stock Purchase Plan. The maximum number of shares which may be issued over the term of the Stock Purchase Plan is 100,000, which is subject to anti-dilution provisions.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

The members of our compensation committee are Messrs. Hutchison, Liberati and Hopple. Mr. Liberati also served as the member of the compensation committee of MCSi until his retirement in February 2000.

LIMITATION OF LIABILITY AND INDEMNIFICATION OF OFFICERS AND DIRECTORS

Our amended and restated certificate of incorporation and amended and restated bylaws provide that the personal liability of our directors and officers shall be eliminated to the fullest extent authorized by Delaware law. Our amended and restated certificate of incorporation and amended and restated bylaws further provide that our directors and officers shall be indemnified by us to the fullest extent authorized by Delaware law. We intend to obtain insurance which insures our directors and officers against specified losses and which insures us against specific obligations to indemnify our directors and officers.

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CERTAIN TRANSACTIONS

RELATIONSHIP WITH MCSi

Our operations began in January 1999 as a division of MCSi, known as BuySupply.com, which commenced operations as a branded computer supplies and accessories e-commerce Web site selling MCSi's inventory. Shortly thereafter, Messrs. Savarino, Dhadphale and Feaver agreed to combine their prior Internet experience with funding from MCSi to create an e-commerce services company based on our current business model. We were subsequently incorporated on March 2, 1999. After the completion of this offering, MCSi will own approximately 50.7% of the outstanding shares of common stock, or approximately 48.9% if the underwriters exercise their over-allotment option in full.

As a subsidiary, we have received various services provided by MCSi, including administration (i.e., payroll, human resources, cash management, benefit administration, etc.), warehousing and distribution, and property and equipment. In addition, we have received the services of certain MCSi employees, including, in particular, Michael E. Peppel, MCSi's chairman, president and chief executive officer and Ira H. Stanley, its vice president and chief financial officer. In consideration for these services, MCSi has historically allocated a portion of its overhead costs related to such services to us. We cannot assure you that the prices charged to us, or the overall terms and conditions under these agreements are not higher or lower than the prices that may be charged by unaffiliated third parties for similar services.

We have entered into certain agreements with MCSi related to administrative services, distribution services, e-commerce services and a premises and equipment lease. A summary description of each of these agreements is set forth below. You should read the full text of these agreements, which have been filed with the SEC as exhibits to the registration statement of which this prospectus is a part.

All of our agreements with MCSi were made in the context of a parent-subsidiary relationship. Although we generally believe that the terms of these agreements are consistent with fair market values, we have had no appraisals or valuations performed and therefore we cannot assure you that the prices charged to us, or by us, under these agreements are not higher or lower than the prices that may be charged by, or to, unaffiliated third parties for similar services.

MCSi has advised us that it intends to evaluate, from time to time, alternatives to maximize, for the benefit of its stockholders, the value of its Zengine shareholdings. These alternatives could include retention of all or a portion of its shareholdings, the sale in one or more transactions of all or a portion of its shareholdings, the distribution of its shareholdings to MCSi shareholders (which may be in the form of a tax free spin-off under Section 355 of the Internal Revenue Code), the issuance of debt or equity securities that will enable MCSi to monetize all or a portion of its investment in Zengine or other transactions. We cannot assure you as to which alternative MCSi may choose or whether or when any such transaction will occur, if at all.

ADMINISTRATIVE SERVICES AGREEMENT. Since our formation, we have obtained many of our administrative services from MCSi. In anticipation of this offering, effective October 1, 1999, we entered into a two-year agreement with MCSi where MCSi will provide us with services relating to accounts payable, human resources and compensation, corporate development, employee benefit administration, treasury and cash management, risk and insurance management, executive compensation and benefit plan design, benefit administration, Web site population services and tax planning. In consideration for providing these services, we will pay MCSi $60,000 per month. The administrative services agreement is terminable by either party under a number of circumstances. This agreement is renewable by mutual agreement between Zengine and MCSi.

DISTRIBUTION SERVICES AGREEMENT. We offer product distribution, fulfillment and warehousing, customer service and other related services to our clients as part of our e-commerce service offerings. Effective October 1, 1999, we entered into a two year non-exclusive Distribution Services Agreement with MCSi by which MCSi will provide these services to our clients. Under the agreement, we will pay

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MCSi a service fee equal to three percent (3%) of the total gross revenues for any product order fulfilled, for third party customers, wholly or partly by MCSi (plus certain costs incurred by MCSi.) If product is purchased from MCSi, Zengine will pay MCSi the actual retail list price of that product plus the actual cost of freight paid by MCSi. We subsequently amended the agreement to pay MCSi for warehouse space an amount equal to a percentage of MCSi's gross expenses relating to the operation of the warehouse for us through the end of the term of the agreement.

E-COMMERCE SERVICES AGREEMENT. Effective October 1, 1999, we entered into an e-commerce services agreement with MCSi in which we will provide certain design, enhancement and ongoing maintenance services relating to MCSi's B2B dedicated Web sites for a period of two years. MCSi will pay us ten percent (10%) of the revenue derived from product sales on the MCSi Web sites we service.

PROPERTY SUBLEASE AND EQUIPMENT LEASE AGREEMENT. Effective October 1, 1999, we entered into an agreement to sublease our main office and to lease certain equipment, including chairs, desks, cubicle offices and computers, from MCSi. The agreement provides for monthly payments of $2,083 for the equipment lease and $10,417 for the property sublease, and expires on May 1, 2001.

TRANSACTIONS WITH WILBLAIRCO ASSOCIATES, AT HOME CORPORATION, MCSI AND CERTAIN STOCKHOLDERS

On October 1, 1999, we entered into an agreement to sell 902,478 shares of our common stock to each of Wilblairco Associates and At Home Corporation for $2.0 million each (the "investment transactions"), which was completed in October 1999. Wilblairco Associates, an Illinois general partnership, is an affiliate of William Blair & Company, which is the lead underwriter of this offering.

In conjunction with our sale of equity to Wilblairco Associates and At Home Corporation, we entered into a Registration Rights Agreement and a Stockholders Agreement and MCSi entered into Put Agreements with Wilblairco and At Home. We subsequently entered into a warrant agreement with REX Stores Corporation, in conjunction with our agrement to provide e-commerce services to rexstores.com, Inc., a subsidiary of REX Stores, where we agreed to provide REX Stores with the same registration rights as we gave to Wilblairco and At Home.

REGISTRATION RIGHTS AGREEMENT. At any time after 180 days after we complete our first public offering of common stock where the aggregate price less underwriters' and brokers' commissions and certain expenses equals $25.0 million or more and results in our common stock being listed on the New York Stock Exchange, American Stock Exchange or the Nasdaq Stock Market (a "qualified public offering"), Wilblairco, At Home, MCSi, Joseph Savarino, Lalit Dhadphale, Christopher Feaver and/or REX Stores (the "registration rights holders") may request registration (a "demand registration") of at least $15.0 million of our common stock held by them. We are not obligated to effect more than one demand registration in any six month period and, subject to certain conditions, we will not be obligated to effect more than three demand registrations overall. The registration rights holders also have the right, subject to certain conditions, to include their shares of our common stock in any registered offering of our common stock that we make (an "incidental registration").

The ability of the registration rights holders to request demand registration of their Zengine common stock is subject to the opinion of the managing underwriter of the proposed offering that the number of shares desired to be sold exceeds the number of shares which can be sold in the offering or is reasonably likely to materially and adversely affect the success or offering price of such offering. If the underwriter makes this determination, the shares will be included in the offering in the following priority:

- first, shares of the registration rights holders pro rata on the basis of the number of share requested to be included by each;

- next, shares requested to be included by us; and

- next, any other shares of our common stock requested to be included by a third person.

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If the managing underwriter makes the same determination in connection with an incidental registration, the shares will be included in the offering in the following priority:

- shares requested to be included by us;

- next, shares of the registration rights holders pro rata on the basis of the shares requested to be included by each; and

- next, shares of the holders of any other registration rights granted by us in writing, pro rata in accordance with the number of such securities each such holder has requested to be included in the registration.

In addition to the registration priorities discussed in the preceding paragraph, the registration rights agreement prohibits us from granting registration rights to any other person, unless the agreement(s) providing for the rights specifically provides that the holders of the rights ("third party rights") may not participate in any demand or incidental registration unless the underwriters of the distribution confirm that the inclusion of the securities proposed to be included under the third party rights will not materially adversely affect the offering. We may, however, grant third party rights to a person who has purchased our securities for an aggregate of at least $2.0 million prior to a qualified public offering which rights may allow participation in a demand registration as though such person was a registration rights holders.

The registration rights agreement sets forth various registration procedures. It also provides that we will pay all reasonable expenses related to all demand and incidental registrations other than underwriters discounts and commissions. The registration rights agreement also contains indemnification and contribution provisions by us for the benefit of the registration rights holders, their affiliates and any underwriters, and limited indemnification provisions by the registration rights holders for the benefit of us and any underwriters. The rights in the registration rights agreement may not be assigned by a registration rights holder without our prior consent, which will not be unreasonably withheld.

PUT AGREEMENTS. MCSi entered into put agreements with each of Wilblairco and At Home which provide that during a period of two years commencing on September 30, 2002, Wilblairco and At Home each have the right, from time to time, to require MCSi to purchase all or a portion of their shares purchased in the investment transactions at a purchase price of $3.37 per share. The rights in the put agreements are not transferable and are subject to anti-dilution provisions. The put agreements will terminate upon the completion of this offering.

STOCKHOLDERS AGREEMENT. The stockholders agreement between Wilblairco, At Home, MCSi, Zengine, Joseph Savarino, Lalit Dhadphale, Christopher Feaver and REX Stores specifies and limits the manner and terms upon and by which the shares outstanding as of September 30, 1999 shall or may be transferred in certain circumstances. The stockholders agreement will terminate upon the completion of this initial public offering.

We believe that the transactions with Wilblairco Associates, At Home Corporation, MCSi and certain of our stockholders and REX Stores described immediately above were made on terms no less favorable to us than we could have obtained from unaffiliated third parties. All future transactions between us and our directors, officers, principal stockholders and their affiliates will be approved by a majority of the independent and disinterested outside members of our board of directors, but we cannot assure you that future transaction will be on terms no less favorable to us than could be obtained from unaffiliated third parties.

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PRINCIPAL STOCKHOLDERS

The following table sets forth information regarding the beneficial ownership of our common stock as of June 30, 2000, by the following individuals or groups:

- each person or entity who is known by us to own beneficially more than 5% of our outstanding stock;

- each of the named executive officers;

- each of our directors; and

- all directors and executive officers as a group.

Under the rules of the Securities and Exchange Commission, beneficial ownership includes voting or investment power with respect to securities and includes the shares issuable under stock options that are exercisable within sixty (60) days of June 30, 2000. Shares issuable under stock options are deemed outstanding for computing the percentage of the person holding options but are not outstanding for computing the percentage of any other person. The number of shares of common stock outstanding after this offering includes shares of common stock being offered for sale by us in this offering. The percentage of beneficial ownership for the following table is based upon 12,183,480 shares of common stock outstanding as of June 30, 2000, and 16,473,480 shares of common stock outstanding after the completion of this offering assuming no exercise of the underwriters' overallotment option. As of June 30, 2000, the Company had six stockholders.

The address for each of the stockholders listed in the table, other than MCSi, Wilblairco Associates and At Home Corporation, is c/o Zengine, Inc., 6100 Stewart Avenue, Fremont, California 94538. To our knowledge, the persons named in the table have sole voting and investment power with respect to all shares of common stock held by them. None of the beneficial owners set forth in the table below will sell any of the shares in this offering.

                                                                                     PERCENTAGE OF SHARES
                                                                                         OUTSTANDING
                                                           NUMBER OF SHARES    --------------------------------
NAME AND ADDRESS OF BENEFICIAL OWNER                      BENEFICIALLY OWNED   BEFORE OFFERING   AFTER OFFERING
------------------------------------                      ------------------   ---------------   --------------
MCSi, Inc. (formerly known as Miami Computer Supply             8,347,944            68.5%                %
  Corporation)..........................................
  4750 Hempstead Station Drive
  Dayton, Ohio 45429
Wilblairco Associates...................................          902,478             7.4
  222 West Adams Street
  Chicago, Illinois 60600
At Home Corporation.....................................          902,478             7.4
  450 Broadway
  Redwood City, California 94063
Michael E. Peppel.......................................        676,860(1)            5.3
Joseph M. Savarino......................................        676,860(2)            5.6
Louis T. Lipinski.......................................               --              --
Lalit P. Dhadphale......................................        676,860(2)            5.6
Christopher R. Feaver...................................        676,860(2)            5.6
Christopher R. Lunt.....................................               --              --
Anthony W. Liberati.....................................               --              --
Donald B. Hutchinson....................................               --              --
Richard V. Hopple.......................................               --              --
Stacey Snider...........................................               --              --
All directors and officers as a group (10 persons)......        2,707,440            22.2


(1) Represents shares which may be acquired upon the exercise of stock options exercisable within 60 days.

(2) Represents restricted shares of common stock of which 399,165 shares were vested as of June 30, 2000 and the remainder will vest upon completion of this offering.

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DESCRIPTION OF CAPITAL STOCK

Under our amended and restated certificate of incorporation (which will be effective prior to the completion of this offering), our authorized capital stock consists of 120,000,000 shares, of which 100,000,000 shares are common stock, no par value per share, and 20,000,000 shares are preferred stock, no par value per share, of which none are outstanding. Immediately following this offering, 16,473,480 shares of common stock, or 17,058,480 shares if the underwriters exercise their over-allotment option in full, will be outstanding. The following description of our capital stock is qualified in its entirety by our amended and restated certificate of incorporation and amended and restated bylaws, both of which are included as exhibits to the registration statement of which this prospectus forms a part.

COMMON STOCK

Holders of our common stock will be entitled to one vote per share with respect to each matter presented to our stockholders on which the holders of common stock are entitled to vote. Except as may be provided in connection with any preferred stock in a certificate of designation filed pursuant to the Delaware General Corporation Law (DGCL), or as may otherwise be required by law or the amended and restated certificate of incorporation, the common stock will be the only capital stock of Zengine entitled to vote in the election of directors and on all other matters presented to our stockholders; provided that holders of common stock, as such, will not be entitled to vote on any matter that relates solely to the terms of any outstanding series of preferred stock or the number of shares of such series and does not affect the number of authorized shares of preferred stock or the powers, privileges and rights pertaining to the preferred stock. The common stock does not have cumulative voting rights.

Subject to the prior rights of holders of preferred stock, if any, holders of common stock are entitled to receive such dividends as may be lawfully declared from time to time by our board of directors. Upon any liquidation, dissolution or winding up of Zengine, whether voluntary or involuntary, holders of common stock will be entitled to receive such assets as are available for distribution to stockholders after there shall have been paid or set apart for payment the full amounts necessary to satisfy any preferential or participating rights to which the holders of each outstanding series of preferred stock are entitled by the express terms of such series.

The outstanding shares of our common stock are, and the shares of common stock being offered hereby will be, upon payment therefor, validly issued, fully paid and nonassessable. The common stock sold in this offering will not have any preemptive, subscription or conversion rights. Additional shares of authorized common stock may be issued, as determined by our board of directors from time to time, without stockholder approval, except as may be required by applicable law or stock exchange or Nasdaq Stock Market requirements.

PREFERRED STOCK

Our board of directors is empowered, without approval of the stockholders, to cause shares of preferred stock to be issued from time to time in one or more series, with the numbers of shares of each series and the designation, powers, privileges, preferences and rights of the shares of each such series and the qualifications, limitations and restrictions thereof as fixed by our board of directors. Among the specific matters that may be determined by our board of directors are:

- the designation of each series;

- whether the shares of each series has voting rights;

- the rate of dividends, if any

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- whether dividends, if any, shall be cumulative or non-cumulative;

- the terms of redemption, if any;

- the amount payable in the event of any voluntary or involuntary liquidation, dissolution or winding up of the affairs of Zengine;

- rights and terms of conversion or exchange, if any;

- the price for which the shares may be issued;

- restrictions on the payment of dividends on redemptions of stock while any shares of such series is outstanding; and

- any other powers, preferences and other special rights or qualifications on limitations.

Although no shares of preferred stock are currently outstanding and we have no current plans to issue preferred stock, the issuance of shares of preferred stock, or the issuance of rights to purchase such shares, could be used to discourage an unsolicited acquisition proposal. For example, a business combination could be impeded by the issuance of a series of preferred stock containing class voting rights that would enable the holder or holders of such series to block any such transaction. Alternatively, a business combination could be facilitated by the issuance of a series of preferred stock having sufficient voting rights to provide a required percentage vote of the stockholders. In addition, under certain circumstances, the issuance of preferred stock could adversely affect the voting power and other rights of the holders of the common stock. Although our board of directors is required to make any determination to issue any such stock based on its judgment as to the best interests of the stockholders of Zengine, it could act in a manner that would discourage an acquisition attempt or other transaction that some, or a majority, of the stockholders might believe to be in their best interests or in which stockholders might receive a premium for their stock over prevailing market prices of such stock. Our board of directors does not at present intend to seek stockholder approval prior to any issuance of currently authorized stock, unless otherwise required by law or applicable stock exchange or Nasdaq Stock Market requirements.

WARRANT

As of June 30, 2000, there was an agreement to issue one warrant to purchase 1.7% of the issued and outstanding shares of our common stock immediately after our initial public offering. We agreed to issue this warrant in January 2000 to REX Stores Corporation contingent upon completion of a successful initial public offering at an exercise price equal to the initial public offering price per share. The warrant will be issued and become immediately exercisable immediately after the closing of our initial public offering. It will expire three years after its date of issue.

LIMITATION OF LIABILITY OF DIRECTORS

Our amended and restated certificate of incorporation provides that the personal liability of our directors for monetary damages shall be eliminated to the fullest extent provided by the DGCL. Section 102(b)(7) of the DGCL states, that a director of Zengine will not be personally liable to Zengine or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability imposed by law (as in effect from time to time):

- for any breach of the director's duty of loyalty to Zengine or its stockholders;

- for any act or omission not in good faith or which involved intentional misconduct or a knowing violation of law; or

- for any transaction from which the director derived an improper personal benefit.

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The inclusion of this provision in the amended and restated certificate of incorporation may have the effect of reducing the likelihood of derivative litigation against directors, and may discourage or deter stockholders or management from bringing a lawsuit against directors for breach of their duty of care, even though such an action, if successful, might otherwise have benefited Zengine and its stockholders.

Our amended and restated certificate of incorporation also requires that Zengine provide indemnification to its directors, officers and employees to the extent currently permitted by the DGCL.

SECTION 203 OF THE DELAWARE GENERAL CORPORATION LAW AND BYLAWS

We are a Delaware corporation and subject to Section 203 of the DGCL. Generally, Section 203 prohibits a publicly held Delaware corporation from engaging in a "business combination" with an "interested stockholder" for a period of three years after the time such stockholder became an interested stockholder unless certain conditions are satisfied. Thus, this provision may make acquisition of control of Zengine more difficult. The prohibitions in
Section 203 of the DGCL do not apply if:

- prior to the time the stockholder became an interested stockholder, the board of directors of the corporation approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder;

- upon consummation of the transaction which resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced; or

- at or subsequent to the time the stockholder became an interested stockholder, the business combination is approved by the board of directors and authorized by the affirmative vote of at least 66 2/3% of the outstanding voting stock that is not owned by the interested stockholder.

Under Section 203 of the DGCL, a "business combination" includes:

- any merger or consolidation of the corporation with the interested stockholder;

- any sale, lease, exchange or other disposition, except proportionately as a stockholder of such corporation, to or with the interested stockholder of assets of the corporation having an aggregate market value equal to 10% or more of either the aggregate market value of all the assets of the corporation or the aggregate market value of all the outstanding stock of the corporation;

- certain transactions resulting in the issuance or transfer by the corporation of stock of the corporation to the interested stockholder;

- certain transactions involving the corporation which have the effect of increasing the proportionate share of the stock of any class or series of the corporation which is owned by the interested stockholder; or

- certain transactions in which the interested stockholder receives financial benefits provided by the corporation.

Under Section 203 of the DGCL, an "interested stockholder" generally is:

- any person that owns 15% or more of the outstanding voting stock of the corporation;

- any person that is an affiliate or associate of the corporation and was the owner of 15% or more of the outstanding voting stock of the corporation at any time within the three-year period prior to the date on which it is sought to be determined whether such person is an interested stockholder; and

- the affiliates or associates of any such person.

63

Because MCSi owned more than 15% of our voting stock before we became a public company in this offering, Section 203 of the DGCL by its terms is currently not applicable to business combinations between MCSi and us even though MCSi owns 15% or more of our outstanding stock. If any other person acquires 15% or more of our outstanding stock, such person will be subject to the provisions of Section 203 of the DGCL.

CERTAIN PROVISIONS OF OUR AMENDED AND RESTATED CERTIFICATE OF INCORPORATION

Our amended and restated certificate of incorporation and amended and restated bylaws contain provisions governing various methods and procedures to be followed in connection with stockholder actions. These provisions include a requirement that advance notice be delivered to Zengine of any business to be brought by a stockholder before an annual or special meeting of stockholders and for certain procedures to be followed by stockholders in nominating persons for election to our board of directors. Generally, special meetings of stockholders may only be called by our board of directors, chairman, president or holders of 35% or more of our outstanding common stock. Only such business may be conducted at a special meeting of stockholders as is set forth in the notice for such meeting. Stockholders may act without a meeting provided that written consents signed by not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all of the stockholders who would be entitled to vote at a meeting called for that purpose were present and voted.

Our amended and restated certificate of incorporation provides that, except as may be provided in connection with the issuance of any series of preferred stock, the number of directors shall be fixed from time to time pursuant to a resolution adopted by our board of directors. Our amended and restated certificate of incorporation provides for a classified board of directors, consisting of three classes as nearly equal in size as practicable. Each class holds office until the third annual stockholders' meeting for election of directors following the most recent election of such class, except that the initial terms of the three classes expire in 2001, 2002 and 2003, respectively. Directors may only be removed for cause on the affirmative vote of a majority of the outstanding shares then entitled to vote. Vacancies on the board of directors may be filled by a vote of the directors then in office.

LISTING

Application has been made for quotation of our common stock on the Nasdaq National Market under the symbol "ZNGN."

TRANSFER AGENT AND REGISTRAR

The transfer agent and registrar for our common stock is Registrar and Transfer Company. Its address is 10 Commerce Drive, Cranford, New Jersey 07016.

64

SHARES ELIGIBLE FOR FUTURE SALE

GENERAL

The 4,290,000 shares of our common stock sold in this offering, or 4,875,000 shares if the underwriters exercise their over-allotment option in full, will be freely tradable without restriction under the Securities Act, except for any such shares which may be acquired by an "affiliate" of Zengine (an "Affiliate") as that term is defined in Rule 144 under the Securities Act, which shares will remain subject to the resale limitations of Rule 144.

The 8,347,944 shares of our common stock that will continue to be held by MCSi after this offering constitute "restricted securities" within the meaning of Rule 144, and will be eligible for sale by MCSi in the open market on , 2000, subject to certain contractual lockup provisions and the applicable requirements of Rule 144, both of which are described below. Zengine has granted certain registration rights to MCSi. See "--Registration Rights."

Generally, Rule 144 provides that a person who has beneficially owned "restricted" shares for at least one year will be entitled to sell on the open market in brokers' transactions within any three month period a number of shares that does not exceed the greater of:

- 1% of the then outstanding shares of common stock; and

- the average weekly trading volume in the common stock on the open market during the four calendar weeks preceding such sale.

Sales under Rule 144 are also subject to certain post-sale notice requirements and the availability of current public information about Zengine.

In the event that any person other than MCSi who is deemed to be an Affiliate purchases shares of our common stock pursuant to this offering or acquires shares of our common stock pursuant to an employee benefit plan of Zengine, the shares held by such person are required under Rule 144 to be sold in brokers' transactions, subject to the volume limitations described above. Shares properly sold in reliance upon Rule 144 to persons who are not Affiliates are thereafter freely tradable without restriction.

Sales of substantial amounts of our common stock in the open market, or the availability of such shares for sale, could adversely affect the price of our common stock.

Each of Zengine, MCSi, Wilblairco Associates, At Home Corporation and the directors and executive officers of Zengine and MCSi have agreed that, without the prior written consent of William Blair & Company on behalf of the underwriters, they will not, during the period ending 180 days after the date of this prospectus, sell or otherwise dispose of any shares of our common stock, subject to certain exceptions. See "Underwriters."

An aggregate of 3,484,300 shares of our common stock are reserved for issuance under our stock option plan and employee stock purchase plan. We intend to file a registration statement on Form S-8 covering the issuance of shares of our common stock pursuant to these plans. Accordingly, the shares issued pursuant to these stock option plans will be freely tradable, subject to the restrictions on resale by Affiliates under Rule 144.

REGISTRATION RIGHTS

We have entered into a registration rights agreement with Wilblairco, At Home, REX Stores, MCSi and Messrs. Savarino, Dhadphale and Feaver which provides that they may require us to register under the Securities Act all or a portion of our common stock that they hold at any time after 180 days after this offering, subject to certain conditions. Any shares of our common stock sold pursuant to these registration rights would be eligible for immediate resale in the public market without restriction by persons other than our Affiliates. For more information regarding this registration rights agreement, please see "Certain Transactions."

65

Any sales of substantial amounts of our common stock in the public market, or the perception that such sales might occur (whether as a result of MCSi's registration rights or otherwise), could have a material adverse effect on the market price of our common stock. See "Risk Factors."

PLAN OF DISTRIBUTION

Of the 4,290,000 shares offered by this prospectus, 3,900,000 shares are being offering by means of an underwritten public offering and 390,000 shares are being offered by means of the MCSi Subscription Program to stockholders of MCSi, our parent company and principal stockholder.

UNDERWRITTEN PUBLIC OFFERING

The several underwriters named below, for which William Blair & Company, L.L.C., Friedman, Billings, Ramsey and Co., Inc., E*OFFERING Corp. and Morgan Keegan & Company, Inc. are acting as representatives, have severally agreed, subject to the terms and conditions set forth in the underwriting agreement among Zengine and the underwriters, to purchase from Zengine, and Zengine has agreed to sell to each of the underwriters, the respective number of shares of common stock set forth opposite each underwriter's name in the table below.

                                                              NUMBER OF
UNDERWRITER                                                    SHARES
-----------                                                   ---------
William Blair & Company, L.L.C..............................
Friedman, Billings, Ramsey & Co., Inc.......................
E*OFFERING Corp.............................................
Morgan Keegan & Company, Inc................................
                                                              ---------
      Total.................................................
                                                              =========

This offering will be underwritten on a firm commitment basis. In the underwriting agreement, the underwriters have agreed, subject to the terms and conditions set forth therein, to purchase the shares of common stock being sold pursuant thereto at a price per share equal to the public offering price less the underwriting discount specified on the cover page of this prospectus. According to the terms of the underwriting agreement, the underwriters will either purchase all of the shares or none of them. In the event of default by any underwriter, in certain circumstances the purchase commitments of the non-defaulting underwriters may be increased or the underwriting agreement may be terminated.

The representatives of the underwriters have advised Zengine that the underwriters will offer the shares of common stock to the public at the public offering price specified on the cover page of this prospectus. The underwriters may also offer the shares to dealers at the public offering price less a concession of up to per share. The underwriters may allow, and these dealers may re-allow, a concession of up to per share to certain other dealers. The underwriters will offer the shares subject to prior sale and subject to receipt and acceptance of the shares by the underwriters. The underwriters may reject any order to purchase shares in whole or in part. The underwriters expect that Zengine will deliver the shares to the underwriters through the facilities of the Depository Trust Company in New York, New York on or about , 2000. At that time, the underwriters will pay Zengine for the shares in immediately available funds. After the commencement of the initial public offering, the representatives may change the public offering price and the other selling terms.

The underwriters have the option to purchase up to an aggregate of 585,000 additional shares of common stock from Zengine at the same price they are paying for the 3,900,000 shares offered hereby in the underwritten public offering. The underwriters may purchase additional shares only to cover over-allotments made in connection with this offering and only within 30 days after the date of this prospectus. If the underwriters decide to exercise this over-allotment option, each underwriter will be required to purchase additional shares in approximately the same proportion as set forth in the table

66

above. The underwriters will offer any additional shares that they purchase on the terms described in the preceding paragraph.

The following table summarizes the compensation to be paid by Zengine to the underwriters:

                                                                                   TOTAL
                                                                      -------------------------------
                                                                         WITHOUT            WITH
                                                          PER SHARE   OVER-ALLOTMENT   OVER-ALLOTMENT
                                                          ---------   --------------   --------------
Public offering price...................................  $              $                $
Underwriting discount paid by Zengine...................

Zengine estimates the expenses of this offering payable by Zengine (excluding the underwriting discount) to be $1.2 million.

Zengine has agreed to indemnify the underwriters and their controlling persons against specific liabilities, including liabilities under the Securities Act.

Zengine, its executive officers and directors, MCSi, Wilblairco and At Home have agreed not to sell or transfer any shares of common stock, or to engage in hedging transactions with respect to the common stock, for a period of 180 days from the date of this prospectus without the consent of William Blair. After giving effect to this offering, stockholders who have agreed to this lock-up arrangement will hold an aggregate of 12,183,480 shares of common stock and options to purchase 1,380,118 shares of common stock. For more information, see "Shares Eligible for Future Sale."

In connection with this offering, the underwriters and other persons participating in this offering may engage in transactions which affect the market price of the common stock. These may include stabilizing and over-allotment transactions and purchases to cover syndicate short positions. Stabilizing transactions consist of bids or purchases for the purpose of pegging, fixing or maintaining the price of the common stock. Over-allotment involves selling more shares of common stock in this offering than are specified on the cover page of this prospectus, which results in a syndicate short position. The underwriters may cover this short position by purchasing common stock in the open market or by exercising all or part of their over-allotment option. In addition, the representatives of the underwriters may impose a penalty bid. This allows the representatives to reclaim the selling concession allowed to an underwriter or selling group member if common stock sold by such underwriter or selling group member in this offering is repurchased by the representatives in stabilizing or syndicate short covering transactions. These transactions, which may be effected on the Nasdaq National Market or otherwise, may stabilize, maintain or otherwise affect the market price of the common stock and could cause the price to be higher than it would be without these transactions. The underwriters and other participants in this offering are not required to engage in any of these activities and may discontinue any of these activities at any time without notice. Neither Zengine nor any of the underwriters makes any representation or prediction as to whether the underwriters will engage in these transactions or choose to discontinue any transactions engaged in or as to the direction or magnitude of any effect that these transactions may have on the price of the common stock.

The representatives of the underwriters have advised Zengine that the underwriters do not intend to confirm, without client authorization, sales to any account over which they exercise discretionary authority.

Prior to this offering, there has been no public market for Zengine's common stock. Consequently, Zengine and the representatives of the underwriters will negotiate to determine the initial public offering price. They will consider current market conditions, Zengine's operating results in recent periods, the market capitalization of other companies in its industry and estimates of Zengine's potential. The estimated price range specified on the cover page of this prospectus may change because of market conditions and other factors.

The underwriters have reserved for sale, at the initial public offering price, up to 195,000 shares of common stock in this offering for Zengine employees and other individuals with a relationship with

67

Zengine. Purchases of the reserved shares would reduce the number of shares available for sale to the general public. The underwriters will offer any reserved shares which are not so purchased to the general public on the same terms as the other shares.

We have applied for listing of the common stock on the Nasdaq National Market under the symbol "ZNGN."

In October 1999, we sold 902,478 shares of our common stock to Wilblairco Associates for $2.0 million. Wilblairco Associates, an Illinois general partnership, is an affiliate of William Blair & Company, which is the lead underwriter of this offering.

fbr.com, a division of FBR Investment Services, Inc., which is an affiliate of Friedman, Billings, Ramsey & Co., Inc., will be providing an Internet distribution channel for this offering. Friedman, Billings, Ramsey & Co., Inc. has agreed to allocate a limited number of shares to fbr.com for sale to its online brokerage account holders. An electronic prospectus is available on the Web site maintained by fbr.com. Other than the prospectus in electronic format, the information on the fbr.com Web site relating to this offering is not a part of this prospectus and should not be relied upon by prospective investors.

E*OFFERING Corp., one of the underwriters, will allocate for distribution by E*TRADE Securities, Inc. a portion of the shares that E*OFFERING is underwriting in this offering. Copies of the prospectus in electronic format, from which you can link to a "Meet the Management" presentation through an embedded hyperlink, will be made available on Internet Web site, maintained by E*OFFERING Corp. and E*TRADE Securities, Inc. Customers of E*TRADE Securities, Inc. who complete and pass an online eligibility profile may place conditional offers to purchase shares in this offering through E*TRADE's Internet Web site.

MCSi SUBSCRIPTION PROGRAM

As part of this offering, we are offering 390,000 shares of our common stock in the MCSi Subscription Program to stockholders of MCSi, our parent company and principal stockholder. MCSi's stockholders may subscribe for one share of common stock for every 30 shares of MCSi common stock held by them, and may not transfer the opportunity to subscribe to another person except involuntarily by operation of law. Persons who owned at least 100 shares of MCSi common stock as of May 15, 2000 are eligible to purchase shares from us under the program. Shareholders who own less than 100 shares of MCSi common stock will be ineligible to participate in the MCSi Subscription Program.

Under a standby purchase agreement, MCSi will purchase from us any of the shares offered by us under the program that are not purchased by the stockholders of MCSi. Distribution of share certificates purchased through the MCSi Subscription Program will be made to the purchasers as soon as practicable following closing of the sale of the shares to the public. It is expected that sales under the MCSi Subscription Program will be reflected in purchasers' book-entry accounts at the Depository Trust Company, if any, upon the closing of these sales. After the closing of these sales, we will mail stock certificates to all purchasers who do not maintain book-entry accounts at the Depository Trust Company. Prior to this offering, MCSi owned 68.5% of our common stock. After this offering, MCSi will own approximately 50.7% of our common stock, assuming that all 390,000 shares are purchased by MCSi stockholders in the subscription program. The purchase price under the program, whether paid by MCSi stockholders or MCSi, will be the same price per share as set forth on the cover page of this prospectus. All shares will be sold to stockholders of MCSi or to MCSi. Neither MCSi nor any other underwriter will receive any compensation from Zengine or any other person, with respect to this subscription offering, including any underwriting discounts or commissions.

The total proceeds before expenses to be received by Zengine from both the underwritten public offering and the MCSi Subscription Program will be approximately $55.0 million, assuming no exercise of the over-allotment option.

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The expenses of the MCSi Subscription Program are estimated at $25,000 and are payable by us. The total expenses for the offering, including the expenses associated with the underwritten public offering, are estimated at approximately $1.2 million.

MCSi is an underwriter with respect to the shares included in the MCSi Subscription Program. MCSi is not an underwriter with respect to the other shares offered by this prospectus. MCSi is not included in the term "underwriter" as used in this prospectus. MCSi's sole condition to purchase any shares that are not purchased by its stockholders in the MCSi Subscription Program is that the conditions to the underwriter's obligation have been met. This means that MCSi will be required to purchase these shares if, and only if, the underwriters are obligated to purchase shares in the underwritten public offering. MCSi has not participated in any discussions or negotiations with Zengine and the underwriters regarding the initial public offering price. MCSi will not have any right to seek indemnification from Zengine regarding its agreement to accept underwriter liability with respect to the shares included in the MCSi Subscription Program.

LEGAL MATTERS

The validity of the common stock offered hereby will be passed upon for us by Elias, Matz, Tiernan & Herrick L.L.P., Washington, D.C. Certain legal matters in connection with this offering will be passed upon for the underwriters by Sidley & Austin, Chicago, Illinois.

EXPERTS

The financial statements of Zengine, Inc., as of September 30, 1999 and March 31, 2000, and for each of the periods from inception (January 1, 1999) to September 30, 1999 and from October 1, 1999 to March 31, 2000 included in this prospectus have been so included in reliance on the report of PricewaterhouseCoopers LLP, independent accountants, given on the authority of said firm as experts in auditing and accounting.

ADDITIONAL INFORMATION

We have filed with the SEC a registration statement, as amended, on Form S-1 under the Securities Act with respect to the shares of our common stock offered hereby. This prospectus does not contain all of the information set forth in the registration statement and the exhibits and schedules thereto. Some items are omitted in accordance with the rules and regulations of the SEC. For further information about us and our common stock, reference is made to the registration statement and the exhibits and any schedules filed therewith. To the extent that statements contained in this prospectus refer to the contents of any contract or other document which is filed as an exhibit to the registration statement, reference is made to the copy of such contract or other document, and each statement is qualified in all respects by such reference. A copy of the registration statement, including the exhibits and schedules thereto, may be read and copied at the SEC's Public Reference Room at 450 Fifth Street, N.W., Washington, D.C. 20549 and at the SEC's regional offices at Seven World Trade Center, New York, New York 10048 and 500 West Madison Street, Chicago, Illinois 60661. Information on the operation of the Public Reference Room may be obtained by calling the SEC at 1-800-SEC-0330. In addition, the SEC maintains an Internet site at http://www.sec.gov, from which interested persons can electronically access the registration statement, including the exhibits and any schedules thereto.

Subject to the foregoing, you should rely only on the information contained in this prospectus. We have not authorized anyone to provide you with information different from that contained in this prospectus.

As a result of this offering, we will become subject to the full informational requirements of the Securities Exchange Act of 1934, as amended. We will fulfill our obligations with respect to such requirements by filing periodic reports and other information with the SEC. We intend to furnish our

69

stockholders with annual reports containing consolidated financial statements certified by an independent public accounting firm. We also maintain our Internet site at http://www.zengine.com. Our Internet site and the information contained therein or connected thereto shall not be deemed to be incorporated into this prospectus or the registration statement of which it forms a part.

Our name, logo, KORE, KOG, KIT and certain other tag lines, titles and logos of our products and other products and services mentioned in this prospectus are either our trademarks or service marks or trademarks or service marks that have been licensed to us or are owned by others. Each trademark, trade name or service mark of any other company appearing in this prospectus belongs to its holder.

70

ZENGINE, INC.

INDEX TO FINANCIAL STATEMENTS

                                                                  PAGE(S)
                                                              ----------------
Report of Independent Accountants...........................        F-2

Balance Sheets as of September 30, 1999, March 31, 2000 and
  June 30, 2000 (unaudited).................................        F-3

Statements of Operations for the period from inception
  (January 1, 1999) to September 30, 1999, the six months
  ended March 31, 2000, the three months ended June 30, 2000
  (unaudited) and the nine months ended June 30, 2000
  (unaudited)...............................................        F-4

Statements of Changes in Stockholders' Equity for the period
  from inception (January 1, 1999) to September 30, 1999,
  the six months ended March 31, 2000 and the three months
  ended June 30, 2000 (unaudited)...........................        F-5

Statements of Cash Flows for the period from inception
  (January 1, 1999) to September 30, 1999, the six months
  ended March 31, 2000, the three months ended June 30, 2000
  (unaudited) and the nine months ended June 30, 2000
  (unaudited)...............................................        F-6

Notes to Financial Statements...............................      F-7-F-17

F-1

REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors and Stockholders of Zengine, Inc.

The stock split and the change in the number of authorized shares described in Note 2 to the financial statements has not occurred at August 21, 2000. When it has occurred, we will be in a position to furnish the following report:

"In our opinion, the accompanying balance sheets and the related statements of operations, changes in stockholders' equity and cash flows present fairly, in all material respects, the financial position of Zengine, Inc. ("Zengine"), a majority owned subsidiary of MCSi, Inc., at September 30, 1999 and March 31, 2000, and the results of its operations and its cash flows for the period from inception (January 1, 1999) to September 30, 1999 and the six months ended March 31, 2000 in conformity with accounting principles generally accepted in the United States. These financial statements are the responsibility of Zengine's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with auditing standards generally accepted in the United States which require that we plan and perform the audits 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, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for the opinion expressed above."

PricewaterhouseCoopers LLP

Cincinnati, Ohio
June 26, 2000

F-2

ZENGINE, INC.
BALANCE SHEETS

                                                           SEPTEMBER 30,       MARCH 31,     JUNE 30,
                                                               1999              2000          2000
                                                           -------------      -----------   -----------
                                                                                            (UNAUDITED)
Assets:
  Current assets:
    Cash.............................................       $       406       $    50,733   $        --
    Accounts receivable..............................                --         1,344,621     2,056,502
    Amounts receivable from MCSi (Note 4)............                --         2,354,449     1,759,245
    Other current assets.............................                --           824,963       893,995
                                                            -----------       -----------   -----------

      Total current assets...........................               406         4,574,766     4,709,742
                                                            -----------       -----------   -----------

  Property and equipment, net of accumulated
    depreciation.....................................            15,113            41,886       102,194
  Capitalized software costs, net of accumulated
    amortization.....................................           339,801           446,063       553,218
  Other assets.......................................                --           150,000        81,889
                                                            -----------       -----------   -----------

      Total assets...................................       $   355,320       $ 5,212,715   $ 5,447,043
                                                            ===========       ===========   ===========

Liabilities and stockholders' equity:
  Liabilities:
    Cash overdrafts..................................       $        --       $        --   $    45,137
    Accrued liabilities (Note 6).....................            92,573           657,989       597,315
    Deferred revenue.................................                --           134,584       517,500
                                                            -----------       -----------   -----------

      Total liabilities..............................            92,573           792,573     1,159,952
                                                            -----------       -----------   -----------

  Commitments and contingencies (Notes 3 and 4)......                --                --            --

  Stockholders' equity:
    Common stock, no par value, 100,000,000 shares
      authorized, 12,860,340 shares issued and
      outstanding at September 30, 1999, 12,183,480
      at March 31, 2000 and June 30, 2000............                --                --            --
    Additional paid-in capital.......................         1,301,895         6,953,226     7,353,250
    Unearned compensation............................          (105,525)       (1,772,634)   (2,056,075)
    Accumulated deficit..............................          (933,623)         (760,450)   (1,010,084)
                                                            -----------       -----------   -----------

      Total stockholders' equity.....................           262,747         4,420,142     4,287,091
                                                            -----------       -----------   -----------

      Total liabilities and stockholders' equity.....       $   355,320       $ 5,212,715   $ 5,447,043
                                                            ===========       ===========   ===========

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

F-3

ZENGINE, INC.

STATEMENTS OF OPERATIONS

                                              PERIOD FROM
                                               INCEPTION
                                              (JANUARY 1,         SIX MONTHS      THREE MONTHS      NINE MONTHS
                                                 1999)              ENDED            ENDED             ENDED
                                            TO SEPTEMBER 30,      MARCH 31,         JUNE 30,         JUNE 30,
                                                  1999               2000             2000             2000
                                            ----------------      ----------      ------------      -----------
                                                                                  (UNAUDITED)       (UNAUDITED)
Revenue:

  Third party.........................         $     4,089        $1,354,088       $1,295,077       $2,649,165

  Related party.......................                  --         1,356,828        1,098,293        2,455,121
                                               -----------        ----------       ----------       ----------

                                                     4,089         2,710,916        2,393,370        5,104,286
                                               -----------        ----------       ----------       ----------

Cost of revenue:

  Third party.........................              23,511           231,752          203,791          435,543

  Related party.......................                  --            55,253           24,000           79,253
                                               -----------        ----------       ----------       ----------

                                                    23,511           287,005          227,791          514,796
                                               -----------        ----------       ----------       ----------

Gross profit (loss)...................             (19,422)        2,423,911        2,165,579        4,589,490
                                               -----------        ----------       ----------       ----------

Selling, general and administrative
  expenses:

  Third party.........................             401,081         1,897,202        1,663,253        3,560,455

  Related party.......................             513,120           435,000          794,251        1,229,251
                                               -----------        ----------       ----------       ----------

                                                   914,201         2,332,202        2,457,504        4,789,706
                                               -----------        ----------       ----------       ----------

Income (loss) from operations.........            (933,623)           91,709         (291,925)        (200,216)

Interest income.......................                  --            81,464           42,291          123,755
                                               -----------        ----------       ----------       ----------

Income (loss) before income taxes.....            (933,623)          173,173         (249,634)         (76,461)

Provision for income taxes (Note 5)...                  --                --               --               --
                                               -----------        ----------       ----------       ----------

Net income (loss).....................         $  (933,623)       $  173,173       $ (249,634)      $  (76,461)
                                               ===========        ==========       ==========       ==========

Earnings (loss) per share of common
  stock -- basic......................         $      (.08)       $      .02       $     (.02)      $     (.01)
                                               ===========        ==========       ==========       ==========

Earnings (loss) per share of common
  stock -- diluted....................         $      (.08)       $      .01       $     (.02)      $     (.01)
                                               ===========        ==========       ==========       ==========

Weighted average number of common
  shares outstanding -- basic.........          11,377,184        11,091,515       11,196,537       11,143,051
                                               ===========        ==========       ==========       ==========

Weighted average number of common
  shares outstanding -- diluted.......          11,377,184        13,338,169       11,196,357       11,143,051
                                               ===========        ==========       ==========       ==========

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

F-4

ZENGINE, INC.

STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

                                                 ADDITIONAL
                                     SHARES       PAID-IN       UNEARNED     ACCUMULATED
                                   OUTSTANDING    CAPITAL     COMPENSATION     DEFICIT       TOTAL
                                   -----------   ----------   ------------   -----------   ----------
Incorporation of the Company.....  10,829,760    $    1,000   $        --    $        --   $    1,000
Capital contributions from MCSi
  (Note 4).......................          --     1,105,887            --             --    1,105,887
Stock based compensation (Note
  7).............................   2,030,580       195,008      (195,008)            --           --
Amortization of stock based
  compensation (Note 7)..........          --            --        89,483             --       89,483
Net loss.........................          --            --            --       (933,623)    (933,623)
                                   ----------    ----------   -----------    -----------   ----------
Balance at September 30, 1999....  12,860,340     1,301,895      (105,525)      (933,623)     262,747

Contribution of shares by MCSi
  (Note 3).......................  (2,481,816)           --            --             --           --
Sale of common stock, net of
  related costs (Note 3).........   1,804,956     3,871,049            --             --    3,871,049
Stock based compensation.........          --     1,780,282    (1,780,282)            --           --
Amortization of stock based
  compensation (Note 7)..........          --            --       113,173             --      113,173
Net income.......................          --            --            --        173,173      173,173
                                   ----------    ----------   -----------    -----------   ----------
Balance at March 31, 2000........  12,183,480     6,953,226    (1,772,634)      (760,450)   4,420,142
Stock based compensation --
  (unaudited)....................          --       400,024      (400,024)            --           --
Amortization of stock based
  compensation (Note 7) --
  (unaudited)....................          --            --       116,583             --      116,583
Net loss--(unaudited)............          --            --            --       (249,634)    (249,634)
                                   ----------    ----------   -----------    -----------   ----------
Balance at June 30, 2000 --
  (unaudited)....................  12,183,480    $7,353,250   $(2,056,075)   $(1,010,084)  $4,287,091
                                   ==========    ==========   ===========    ===========   ==========

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

F-5

ZENGINE, INC.

STATEMENTS OF CASH FLOWS

                                           PERIOD FROM
                                            INCEPTION         SIX MONTHS     THREE MONTHS   NINE MONTHS
                                        (JANUARY 1, 1999)        ENDED          ENDED          ENDED
                                         TO SEPTEMBER 30,      MARCH 31,       JUNE 30,      JUNE 30,
                                               1999              2000            2000          2000
                                        ------------------   -------------   ------------   -----------
                                                                                    (UNAUDITED)
Cash flows from operating activities:
  Net income (loss)...................     $  (933,623)       $   173,173    $  (249,634)   $   (76,461)
  Adjustments to reconcile net loss to
    cash used in operating activities:
    Depreciation and amortization.....          21,491             80,709         63,511        144,220
    Non-cash compensation expense.....          89,483            113,173        116,583        229,756
    Changes in assets and liabilities:
      Accounts receivable.............              --         (1,344,621)      (711,881)    (2,056,502)
      Deferred revenue................              --            134,584        382,916        517,500
      Accrued liabilities and cash
        overdrafts....................          92,573            565,416        (15,537)       549,879
      Other assets....................              --           (974,963)          (921)      (975,884)
                                           -----------        -----------    -----------    -----------
        Cash used in operating
          activities..................        (730,076)        (1,252,529)      (414,963)    (1,667,492)
                                           -----------        -----------    -----------    -----------
Cash flows from investing activities:
  Capital expenditures................         (16,140)           (34,083)       (70,640)      (104,723)
  Capitalized software costs..........        (360,265)          (179,661)      (160,334)      (339,995)
  Issuance of demand note--MCSi.......              --         (3,871,049)            --     (3,871,049)
  Net cash settlement under demand
    note arrangement with MCSi........              --          1,516,600        595,204      2,111,804
                                           -----------        -----------    -----------    -----------
        Cash provided by (used in)
          investing activities........        (376,405)        (2,568,193)       364,230     (2,203,963)
                                           -----------        -----------    -----------    -----------
Cash flows from financing activities:
  Sale of common stock to MCSi........           1,000                 --             --             --
  Capital contributions from MCSi.....       1,105,887                 --             --             --
  Sale of common stock, net of related
    expenses..........................              --          3,871,049             --      3,871,049
                                           -----------        -----------    -----------    -----------
        Cash provided by financing
          activities..................       1,106,887          3,871,049             --      3,871,049
                                           -----------        -----------    -----------    -----------
Net increase (decrease) in cash.......             406             50,327        (50,733)          (406)
Cash--beginning of period.............              --                406         50,733            406
                                           -----------        -----------    -----------    -----------
Cash--end of period...................     $       406        $    50,733    $        --    $        --
                                           ===========        ===========    ===========    ===========
Supplemental cash flow information:
  Income taxes paid...................     $        --        $        --    $        --    $        --
                                           ===========        ===========    ===========    ===========
  Interest paid.......................     $        --        $        --    $        --    $        --
                                           ===========        ===========    ===========    ===========

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

F-6

ZENGINE, INC.

NOTES TO FINANCIAL STATEMENTS

1. THE COMPANY

Zengine, Inc. (the "Company") commenced operations in January 1999 as a division of MCSi, Inc. (formerly known as Miami Computer Supply Corporation) ("MCSi") and was incorporated as BuySupply.com, Inc. ("BuySupply"), a wholly owned subsidiary of MCSi in March 1999. BuySupply changed its name to Zengine, Inc. in September 1999. At September 30, 1999 and March 31, 2000, MCSi owned 83.3% and 68.5%, respectively, of the outstanding shares of the Company. As BuySupply, the Company sold computer supplies and audio-visual equipment over the Internet. In the Spring of 1999, the Company began to develop the Zengine business model (described below) and implemented it throughout the Summer and Fall of 1999, while maintaining its Internet operations. Commencing in the Spring of 1999, the Company also devoted time to enhancing, improving and administering dedicated Web sites for certain MCSi customers. Subsequent to September 30, 1999, the Company focused its efforts solely on implementing the Zengine business model, including continued work on enhancing, improving and administering MCSi's Web sites and no longer utilizes the BuySupply model.

The Company emerged from the development stage during the six month period ended March 31, 2000 as it began to earn revenues from the Zengine business model. Start-up costs incurred in the preoperating stage were expensed as incurred. The Company has adopted a fiscal year ending September 30. These financial statements include audited financial statements as of September 30, 1999 and for the Company's initial fiscal period of January 1, 1999 through September 30, 1999 and audited financial statements as of March 31, 2000 and for the six month period then ended. The unaudited financial statements as of June 30, 2000 and for the three and nine month periods then ended have been prepared in accordance with Rule 10-01 of SEC Regulation S-X. Consequently, the unaudited financial statements do not include all the disclosures required under generally accepted accounting principles for complete financial statements. However, in the opinion of the management of the Company, the information presented herein includes all adjustments (consisting only of normal recurring adjustments) necessary to present fairly the financial position, results of operations and cash flows of the Company as of June 30, 2000 and for the three and nine month periods then ended.

The Company provides a comprehensive suite of technology-based solutions that enable businesses to conduct electronic commerce. The Company offers a full range of integrated services for both business-to-business and business-to-consumer e-commerce including Web site user interface design, product content and merchandising, personalization and customer relationship management, advertising and sponsorship management, order management, inventory management and order fulfillment, end-user customer service and reporting and analysis. The Company's solutions, delivered on an outsourced basis, allow its clients to quickly and cost-effectively create, maintain and enhance their e-commerce presence. These solutions allow the Company's clients to build, manage and understand online customer relationships and to market, sell and support products and service more effectively.

The Company has looked to MCSi for financial and business support since its inception. Through September 30, 1999 MCSi contributed $1,106,887 to the capital of the Company; no capital has been contributed by MCSi since September 30, 1999. Revenues for the six month period ended March 31, 2000 include $1,309,828 of revenue from the administration of MCSi's business-to-business dedicated Web sites under an e-commerce services agreement, which became effective October 1, 1999. These revenues represent 48.3% of the Company's total revenue for the six month period ended March 31, 2000. The Company's current arrangement to service the MCSi dedicated Web sites expires in October, 2001. In addition, advertising revenue of $1,349,250, or 49.8% of total revenue, for the six month period ended March 31, 2000 was generated primarily from OEM product advertisers who either placed banner advertisements on clients' Web pages which the Company serves, or purchased

F-7

ZENGINE, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

preferential placement of the OEM manufacturer's products on clients' stores. MCSi has supply arrangements with the OEM companies that purchase advertising from the Company. Although the Company negotiated each OEM advertising arrangement, MCSi's relationships with the OEM companies could have influenced the Company's obtaining the advertising and the Company may not have obtained the advertising without MCSi's relationship. The Company also conducts business with MCSi under a distribution services agreement, administrative services agreement and sublease and equipment leasing agreements. All of these transactions are more fully described in Note 4.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

REVENUE RECOGNITION

Revenues are recognized when goods are shipped or services are performed and accepted by the customer. Revenues for the nine month period ended September 30, 1999 represent revenues of the BuySupply business model. Subsequent to October 1, 1999, all revenues were derived from the Zengine business model.

Revenues under the Zengine business model are comprised of (a) service fees, which include integration and set-up fees, transaction fees and subscription fees, and (b) advertising and sponsorship fees. Revenues are recognized as follows:

SERVICE FEES

INTEGRATION AND SET-UP FEES

The Company provides integration and set-up services to its clients. Under these arrangements, services may include the development or design of a client's Web site, migration of the client's current Web site content to the Company's technology, integration of the client's Web site to the client's current computer systems, or other similar activities. To the extent that these fees are associated with a contract to provide subsequent outsourced transaction-based services to a client, these fees are recognized ratably over the term of the transaction services agreement. Otherwise, revenue is recognized when the service is completed, the client has accepted the service and there is no future obligation to provide any additional service.

TRANSACTION FEES

The Company provides outsourced transaction-based services to customers such as providing product content and merchandising, invoice processing, order management, custom fulfillment and end-user customer service on a commission basis. Pursuant to the Company's arrangements with its first two third party clients, commission revenue is determined as a percentage of the gross margin on the sales value to the end customer. Under all subsequent arrangements, commission revenue is based on a percentage of net sales value to the end customer. Revenue from transaction fees is recognized when the service is completed.

SUBSCRIPTION FEES

The Company provides subscription arrangements for maintenance and related services for a fee. Revenue from subscription fees is recognized ratably over the term of the subscription.

F-8

ZENGINE, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

ADVERTISING AND SPONSORSHIP FEES

Revenues from advertising take the form of fees when the Company sells banner advertising or product placement advertising on Web pages served by the Company on the Company's clients' stores. These arrangements call for continuous advertising or product placement over a certain time period and are not contingent upon events such as obtaining certain levels of sales, Web site visits or other factors. Revenue is recognized ratably over the period of the advertising/placement services based on the fulfillment of obligations under the advertising/placement arrangement.

SUMMARY

Revenue for the nine month period ended September 30, 1999 and the six month period ended March 31, 2000 is summarized as follows:

                                                       NINE MONTHS     SIX MONTHS
                                                          ENDED          ENDED
                                                      SEPTEMBER 30,    MARCH 31,
                                                           1999           2000
                                                      --------------   ----------
Service fees........................................      $   --       $1,361,666
Advertising and sponsorship fees....................          --        1,349,250
Product sales.......................................       4,089               --
                                                          ------       ----------
                                                          $4,089       $2,710,916
                                                          ======       ==========

PROPERTY AND EQUIPMENT

Property and equipment primarily consists of computer technology equipment and is stated at cost, less accumulated depreciation. Depreciation is computed on the straight-line method over the estimated useful lives of the assets (currently, three years for all assets). At September 30, 1999 and March 31, 2000, accumulated depreciation totaled $1,027 and $8,337, respectively. Depreciation expense totaled $1,027 and $7,310, respectively, for the nine month period ended September 30, 1999 and the six month period ended March 31, 2000.

SOFTWARE DEVELOPMENT COSTS

Costs to develop the Company's software have been capitalized subsequent to the Company determining that technological feasibility of the software had been achieved. Software development costs are being amortized over a three year period on a straight-line basis, subject to tests for ultimate realizability based on future estimated revenues. At September 30, 1999 and March 31, 2000, accumulated amortization totaled $20,464 and $93,863, respectively. Amortization expense totaled $20,464 and $73,399, respectively, for the nine month period ended September 30, 1999 and the six month period ended March 31, 2000. Research and development costs which were charged against operations totaled $15,846 during the nine month period ended September 30, 1999 and nil for the six month period ended March 31, 2000.

OTHER ASSETS

Other assets include the Company's prepayments to a client for the contractual right to be the sole audio visual store provider for the client. These costs are being charged to expense on a straight-line basis over the two year term of the related arrangement and total $450,000 ($300,000 and $150,000 of

F-9

ZENGINE, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

other current assets and other assets, respectively) at March 31, 2000. The remainder of the other assets relate to the Company's payment of expenses relating to its planned initial public offering.

ADVERTISING COSTS

The Company expenses all advertising costs as incurred.

INCOME TAXES

Through September 30, 1999, the Company was included in the consolidated income tax return of MCSi. The provision for income taxes is computed on a separate company basis. The asset and liability approach is used to recognize deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the tax bases of assets and liabilities. The Company records a valuation allowance related to its deferred income tax assets when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized.

EARNINGS (LOSS) PER SHARE

Earnings (loss) per share is computed as if the Company had been incorporated on January 1, 1999. Basic per share amounts represent the weighted average number of shares outstanding during the period, while diluted per share amounts give effect to the conversion of all other convertible equity securities (stock options and stock awards) to the extent their assumed conversion is not anti-dilutive. For the period January 1, 1999 through September 30, 1999, the assumed conversion of stock options (169,302) and stock awards (1,145,450) were excluded from diluted loss per share because their assumed conversion was anti-dilutive.

The following table summarizes the shares included in the basic and diluted loss per share calculations.

                                                       NINE MONTHS     SIX MONTHS    NINE MONTHS
                                                          ENDED          ENDED          ENDED
                                                      SEPTEMBER 30,    MARCH 31,    JUNE 30, 2000
                                                           1999           2000       (UNAUDITED)
                                                      --------------   ----------   --------------
Net income (loss) for the period....................    $ (933,623)    $  173,173    $   (76,461)
                                                        ==========     ==========    ===========
Weighted average number of shares
  outstanding--basic................................    11,377,184     11,091,515     11,143,051
Dilutive impact of assumed conversion exercises.....            --      2,246,654             --
                                                        ----------     ----------    -----------
Weighted average number of shares
  outstanding--diluted..............................    11,377,184     13,338,169     11,143,051
                                                        ==========     ==========    ===========
Income (loss) per share--basic......................    $     (.08)    $      .02    $      (.01)
                                                        ==========     ==========    ===========
Income (loss) per share--diluted....................    $     (.08)    $      .01           (.01)
                                                        ==========     ==========    ===========

On September 29, 1999, the Company enacted a 10-for-1 stock split; additionally, the Company intends to effect a 6.7686-for-1 stock split (the "stock splits") and increase its authorized number of common shares prior to an initial public offering of its common stock. All share and per share amounts presented in the financial statements give retroactive treatment to the stock splits as if they had occurred on January 1, 1999.

F-10

ZENGINE, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

COMPREHENSIVE INCOME (LOSS)

The Company has no components of other comprehensive income; accordingly, net loss and comprehensive loss are the same.

CONCENTRATIONS OF CREDIT RISK

The Company's operations are presently conducted in the United States. While the Company intends to expand the scope of its operations internationally, no such activity had occurred through March 31, 2000. At March 31, 2000, accounts receivables totaled $1,344,621. Based on management's assessment, accounts receivable are collectible in full, and no allowance for uncollectible accounts is considered necessary. Accounts receivable are recorded net of amounts owed to the Company's clients as the right of offset of gross receivables and payables exists between the parties. Management monitors its credit risks using policies it considers appropriate in the circumstances.

FAIR VALUES AND DERIVATIVE TRANSACTIONS

The Company believes that the fair value of its monetary assets and liabilities approximates the carrying value in these financial instruments. The Company does not engage in derivative transactions.

STOCK COMPENSATION

The Company measures compensation expense for its stock-based employee compensation plans using the intrinsic value method and has provided in Note 7 the pro forma disclosures of the effect on net income (loss) and earnings (loss) per common share as if the fair value-based method had been applied in measuring compensation expense.

RECENT ACCOUNTING PRONOUNCEMENTS

The Company is not aware of any pending accounting pronouncements that it believes will have a material impact on the Company's financial position, results of operations or cash flows, including the provisions of Staff Accounting Bulletin 101, which was recently issued by the Securities and Exchange Commission.

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 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 periods. Actual results could differ from these estimates.

3. EQUITY TRANSACTIONS

In October 1999, the Company sold to one of its clients and an unrelated investor (the "investors") 1,804,956 shares of common stock of the Company at a price of $2.22 per share for total gross proceeds of $4 million (net proceeds, after offering costs, were $3,871,049). MCSi cancelled 2,481,816 shares of the Company it owned to facilitate this transaction. As described in Note 4, the proceeds from this sale were forwarded to MCSi pending future use by Zengine and is recorded as a component of the amounts receivable from MCSi.

F-11

ZENGINE, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

In connection with the transaction described in the preceding paragraph, the Company paid $600,000 to the client for the contractual right to be the sole audio visual store provider to the client. The amount was capitalized as other assets and is being charged to expense on a straight-line basis over the term of the arrangement. In addition, the Company has committed to purchase $3,400,000 of advertising services over 24 months beginning in December 1999 from one of the investors in monthly installments of $141,667. The Company is recognizing the expense associated with this advertising program as the advertising services are provided on a straight-line basis over the term of the agreement.

In conjunction with an e-commerce services agreement entered into with one of the Company's clients in January 2000, the Company and the client agreed that the client would be granted a warrant to purchase the Company shares if the Company completes an initial public offering ("IPO"). If granted, the warrant will entitle the client to purchase 1.7% of outstanding shares of the Company subsequent to the IPO, at the IPO price. The warrant would be exercisable for a three year period, commencing on the date of grant. Since the issuance of this warrant is based upon uncertain future events, these financial statements do not reflect any accounting relative to this warrant.

4. RELATED PARTY TRANSACTIONS

Effective October 1, 1999, the Company entered into an e-commerce services agreement with MCSi for a two year period. Under the terms of the e-commerce agreement, the Company receives a commission equal to 10% of retail value of products sold to those customers of MCSi provided with dedicated customer Web sites ("Web sites") in exchange for the Company designing, enhancing and providing certain support services for these Web sites.

Additionally, effective October 1, 1999, the Company entered into three other agreements with MCSi; these are (a) a distribution services agreement whereby the Company will pay MCSi a fee of three percent of the retail value of the goods sold to or through third party clients for which MCSi performs the fulfillment and distribution function, (b) an administrative services agreement whereby the Company will be charged $720,000 per year in reimbursement for treasury and cash management services, accounting services, corporate development services, risk management and administrative insurance services, benefit plan design services, human resources and compensation services, Web site population services and advertising sales services costs which MCSi incurs for the Company's benefit, and (c) a leasing agreement whereby the Company will pay MCSi $125,000 per year to lease corporate offices and $25,000 per year to lease certain personal property. These agreements between the Company and MCSi have a two year term, except for the leasing agreement, which expires on May 1, 2001. In June 2000, the distribution services agreement was amended to provide for a fee payable by the Company to MCSi equal to a percentage of MCSi's gross expenses relating to the operation of MCSi's warehouse. This agreement expires on October 1, 2001. The terms of the arrangements with MCSi do not necessarily represent those which would be obtained in an arm's-length transaction with an unrelated party.

F-12

ZENGINE, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

The income statement for the six month period ended March 31, 2000 includes the following relative to these transactions with MCSi:

Revenues associated with the e-commerce services
  agreement.................................................  $1,309,828
                                                              ==========
Cost of revenues associated with the distribution services
  agreement.................................................  $    7,293
                                                              ==========
Expenses associated with the administrative services
  agreement and leasing agreement:
  Cost of revenue...........................................      48,000
  Selling, general and administrative expenses..............     435,000
                                                              ----------
                                                              $  483,000
                                                              ==========

Using the proceeds from the sale of stock described in Note 3, in October, 1999, the Company and MCSi entered into a demand note arrangement ("Demand Note"), whereby the Company loaned $3,871,049 to MCSi. The demand note is payable on demand and accrues interest quarterly at the Merrill Lynch Ready Asset Trust rate (5.65% at March 31, 2000).

In December 1999, MCSi purchased advertising of $47,000 from the Company. In addition, advertising revenue of $1,302,250 for the six months ended March 31, 2000 was generated primarily from OEM product advertisers who either placed banner advertisements on clients' Web pages which the Company serves, or purchased preferential placement of the OEM manufacturer's products on clients' stores. MCSi has supply arrangements with the OEM companies that purchase advertising from the Company. Although the Company negotiated each OEM advertising arrangement, MCSi's relationships with the OEM companies could have influenced the Company's obtaining the advertising and the Company may not have obtained the advertising without MCSi's relationship.

With respect to all of its transactions with MCSi, the Company and MCSi have agreed to a monthly "net" settlement. The following table summarizes the net receivable due from MCSi related to the aforementioned agreements as of March 31, 2000:

Net amount receivable from MCSi arising from the Demand
  Note......................................................  $ 3,871,049
Amounts receivable from MCSi arising from the e-commerce
  services agreement........................................    1,309,828
Amounts receivable arising from advertising services........       47,000
Amounts receivable arising from interest on the Demand
  Note......................................................       81,464
Accounts payable arising from current account activity......   (2,464,599)
Amounts payable to MCSi arising from the distribution
  services agreement........................................       (7,293)
Amounts payable to MCSi arising from the administrative
  services and the leasing agreement........................     (483,000)
                                                              -----------
Net amount receivable from MCSi.............................  $ 2,354,449
                                                              ===========

F-13

ZENGINE, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

Amounts payable arising from current account activity include trade accounts payable and other expenses of the Company which are being paid by MCSi on the Company's behalf. Accordingly, no separate trade accounts payable are included on the accompanying balance sheet.

As a result of entering into the leasing agreement with MCSi, the Company is committed to the following minimum lease payments for the periods presented below:

Six months ending September 30, 2000........................  $ 75,000
Year ending September 30, 2001..............................   100,000
                                                              --------
  Total.....................................................  $175,000
                                                              ========

Through September 30, 1999 the Company looked to MCSi for many of the services it currently receives under the administrative services agreement entered into effective October 1, 1999. These included administrative services such as treasury, payroll, accounting and financial support functions. The financial statements for the nine month period ended September 30, 1999 include charges for these services from MCSi totalling $435,623 and have been allocated from MCSi to the Company based upon the ratio of the number of the Company's employees to the total number of MCSi employees. Management believes this basis is reasonable in the circumstances. As the Company has looked to MCSi for these administrative services since its inception, and will rely on MCSi for these services for the foreseeable future, it is not practical to estimate the costs the Company would have incurred had it obtained these services from unrelated parties.

Through September 30, 1999 MCSi had contributed to the Company, as capital, all of the financial support it had provided rather than loaning funds to the Company. The following table summarizes the interest free financial support that MCSi provided to the Company on a monthly basis from January 1999 through September 30, 1999 that has been recorded as additional paid in capital:

January.........................................  $   56,782
February........................................      39,609
March...........................................      14,941
April...........................................     140,616
May.............................................     106,822
June............................................     149,664
July............................................     137,447
August..........................................     239,987
September.......................................     220,019
                                                  ----------
                                                  $1,105,887
                                                  ==========

Prior to entering into the leasing agreement effective October 1, 1999, the Company operated from premises leased to it, on a month to month basis, by MCSi. During the period ended September 30, 1999, MCSi charged the Company $77,497 for rental of these facilities.

The employees of the Company are permitted to participate in MCSi's defined contribution pension plan. This plan covers substantially all employees who meet certain eligibility requirements and the Company's expense related thereto comprises matches to employee contributions to the Plan, limited to a percent of the employees' compensation. Expenses under the plan were nil and $3,999, respectively, for the nine month period ended September 30, 1999 and the six month period ended March 31, 2000.

F-14

ZENGINE, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

5. INCOME TAXES

From January 1, 1999 through March 31, 2000 the Company paid no income taxes and had no current provision for income taxes due to its operating losses since inception. The components of the provision for income taxes follows:

                                                       NINE MONTHS     SIX MONTHS
                                                          ENDED          ENDED
                                                      SEPTEMBER 30,    MARCH 31,
                                                           1999           2000
                                                      --------------   ----------
Current
  U.S. Federal......................................    $      --       $     --
  State and local...................................           --             --
                                                        ---------       --------
    Total current provision.........................           --             --
                                                        ---------       --------

Deferred
  U.S. Federal......................................     (326,767)       (25,388)
  State and local...................................      (28,009)        (2,987)
  Valuation allowance...............................      354,776         28,375
                                                        ---------       --------
    Total deferred provision........................           --             --
                                                        ---------       --------
    Total provision for income taxes................    $      --       $     --
                                                        =========       ========

A summary of the components of deferred income taxes follows:

                                                        SEPTEMBER 30,      MARCH 31,
                                                            1999             2000
                                                        -------------      ---------
Start up costs....................................        $ 347,396        $ 312,656
Net operating losses..............................          132,316          219,249
Stock based compensation..........................            4,188           20,750
Capitalized software..............................         (129,124)        (169,504)
Valuation allowance...............................         (354,776)        (383,151)
                                                          ---------        ---------
                                                          $      --               --
                                                          =========        =========

Startup costs above relate to selling, general and administrative costs which the Company incurred in its development stage and were expensed in the Company's statement of operations, but must be capitalized and amortized to expense over a five year period for income tax purposes. The Company began amortizing these costs for tax purposes as it generated revenue from its planned business activities during the six month period ended March 31, 2000.

The Company has provided a valuation allowance against its net deferred tax assets because management, at the present time, is of the view that it is more likely than not that these assets will not be realized. The Company's effective tax rate differs from the expected statutory rate by virtue of the inability to currently deduct net operating losses and the valuation allowance described above. The Company's net operating losses of $348,200 and $576,971 at September 30, 1999 and March 31, 2000, respectively, are subject to carryfoward provisions which expire from 2014 through 2015.

F-15

ZENGINE, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

6. ACCRUED LIABILITIES

Accrued liabilities consists of the following:

                                                      SEPTEMBER 30,   MARCH 31,
                                                          1999          2000
                                                      -------------   ---------
Payroll and payroll related costs...................     $36,317      $135,378
Advertising costs...................................          --       141,667
Other...............................................      56,256       380,944
                                                         -------      --------
                                                         $92,573      $657,989
                                                         =======      ========

7. STOCK COMPENSATION AND RELATED MATTERS

In March 1999, the Company granted to three key executives a total of 2,030,580 shares of common stock. These grants vest one third commencing on the date of grant and ratably thereafter, on a quarterly basis, through June 30, 2002. Based on an independent appraisal of the fair value of the shares granted, the Company will recognize compensation expense of $180,000 over the vesting period, of which $78,462 was recognized during the nine month period ended September 30, 1999 and $18,462 was recognized during the six month period ended March 31, 2000.

In August 1999, the Board of Directors formally adopted the Zengine 1999 Stock Option Plan (the "Plan") which had been in effect since March 1999. The Plan provides that up to 1,353,720 options to purchase common stock of the Company may be granted to employees and others. Although, options may be granted with exercise prices equivalent to the estimated fair value of the stock on the grant date, the options granted through May 2000, were granted at exercise prices less than the estimated fair value of the shares on the grant date. The grants with exercise prices less than the fair market value of the stock will result in aggregate compensation charges over the vesting period of $2,195,314 and resulted in compensation charges of $11,021 and $94,711 for the nine month period ended September 30, 1999, and the six month period ended March 31, 2000 respectively. Vesting occurs ratably over a four-year period, although two grants totaling 812,232 options vested on the date of grant. All options expire, if not exercised, ten years from the date of grant. At March 31, 2000, 14,214 options remain which could be granted under the Plan.

The following table summarizes activity in the stock option plan in number of shares:

                                                       NINE MONTHS     SIX MONTHS
                                                          ENDED          ENDED
                                                      SEPTEMBER 30,    MARCH 31,
                                                           1999           2000
                                                      --------------   ----------
Outstanding, beginning balance......................           --      1,128,664
Granted.............................................    1,128,644        226,071
Exercised...........................................           --             --
Expired.............................................           --             --
Forfeited...........................................           --        (15,229)
                                                        ---------      ---------
Outstanding, ending balance.........................    1,128,664      1,339,506
                                                        =========      =========

At March 31, 2000, 812,232 options were exercisable. Outstanding stock options at March 31, 2000 were exercisable at the following amounts per share:
$3.69 (61,933 shares), $2.22 (159,062 shares) and

F-16

ZENGINE, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

$0.08 (1,118,511 shares). The weighted average exercise price of all options outstanding at March 31, 2000 was $.50.

In April 2000, the Company amended and restated its 1999 Stock Option Plan to increase the number of options authorized under the plan to 3,384,300 shares.

The following table illustrates the impact, on a pro forma basis, on the Company's net loss and net loss per share assuming the fair value based method of stock based compensation had been followed by the Company for all stock-based compensation transactions.

                                                         NINE MONTHS       SIX MONTHS
                                                            ENDED            ENDED
                                                        SEPTEMBER 30,      MARCH 31,
                                                            1999              2000
                                                        -------------      ----------
As reported:
  Net income (loss)...............................        $(933,623)       $ 173,173
                                                          =========        =========
  Earnings (loss) per share (basic)...............        $    (.08)       $     .02
                                                          =========        =========
  Earnings (loss) per share (diluted).............        $    (.08)       $     .01
                                                          =========        =========
Pro forma:
  Net income (loss)...............................        $(948,140)       $ 165,360
                                                          =========        =========
  Earnings (loss) per share (basic and diluted)...        $    (.08)       $     .01
                                                          =========        =========

The fair value of each option grant is estimated on the date of grant using the minimum value option pricing model, as the Company has no history of stock price volatility, with the following assumptions:

                                                     NINE MONTHS
                                                        ENDED              SIX MONTHS
                                                    SEPTEMBER 30,             ENDED
                                                        1999             MARCH 31, 2000
                                                 -------------------   -------------------
Expected term..................................              5 years               5 years

Risk-free interest rate........................          5.41%-6.07%                 6.47%

Dividend yield.................................                0.00%                 0.00%

F-17

"MEET THE MANAGEMENT" PRESENTATION FOR
ZENGINE, INC.

Prospective investors will be able to log on to a website maintained by E*OFFERING Corp. at WWW.EOFFERING.COM, where a prospectus is available for review. Within designated sections of the prospectus, including the table of contents and the Underwriting Section of the prospectus, an embedded hyperlink {click here for "Meet the Management" Presentation} will provide exclusive access to the "Meet the Management" Presentation. This presentation highlights selected information contained elsewhere in the prospectus. This presentation does not contain all of the information that you should consider before investing in our common stock. You should read the entire prospectus carefully, including the "Risk Factors" and our financial statements and notes to those financial statements, before making an investment decision.

Visual 1:    Disclaimer


Imagery:    Border and Company logo.

Visual Text:  The "Meet the Management" Presentation is part of our

prospectus. This presentation highlights selected information contained elsewhere in this prospectus. This presentation does not contain all of the information that you should consider before investing in our common stock. You should read the entire prospectus carefully, including the "Risk Factors" and our financial statements and notes to those financial statements, before making an investment decision.

Script: (Joseph Savarino) The "Meet the Management" Presentation is part of our prospectus. This presentation highlights selected information contained elsewhere in this prospectus. This presentation does not contain all of the information that you should consider before investing in our common stock. You should read the entire prospectus carefully, including the "Risk Factors" and our financial statements and notes to those financial statements, before making an investment decision.

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Visual 2: Introduction

Imagery: See Description of Artwork on inside front cover of the Registration Statement for a description of the image located on the inside front cover of the prospectus.

Script: (Joseph Savarino) Welcome to the "Meet the Management" Presentation for Zengine. I'm Joseph Savarino, President and Chief Executive Officer. I would like to introduce Louis Lipinski, Chief Financial Officer and Treasurer. We would like to talk to you about Zengine, a provider of a comprehensive suite of technology-based solutions that enable businesses to conduct electronic commerce. We offer a full range of integrated services for both business-to-business, or B2B, and business-to-consumer, or B2C, e-commerce including Web site user interface design, product content and merchandising, personalization and customer relationship management, advertising and sponsorship management, order management, inventory management and order fulfillment, end-user customer service and reporting and analysis.

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Visual 3: Industry Background

Imagery: Border and Company logo. Two boxes positioned on the left half of the page have arrows pointing from left to right towards a Company logo.

Visual Text: Title: "Industry Background". Box at top left hand of the page has caption: "Growth of the Internet." Box at bottom left of page has caption:
"Challenges Presented by E-Commerce."

Script: (Joseph Savarino) (see "Business--Industry Background"). Widespread acceptance of the Internet has opened numerous opportunities for companies seeking growth and increased efficiencies through B2B and B2C e-commerce. The Gartner Group estimates that B2B e-commerce will grow from $145 billion in 1999 to $3.9 trillion in 2003, and B2C e-commerce will increase from $31 billion in 1999 to $381 billion in 2003, representing five-year compound annual growth rates of 128% and 87%, respectively. As a result of this growth, an increasing number of businesses engage e-commerce service providers to design and implement e-commerce solutions. Although no figures are yet available on the size of the full-service e-commerce outsourcing market, traditional e-commerce outsourcing, usually defined as Web site design, strategy consulting, and software creation and hosting, was a $4.6 billion industry in 1998 and is expected to grow to $39 billion by 2002 according to IDC, representing a compound growth rate of 53%. As customer and supplier expectations increase as a result of industry advancement, companies are forced to take advantage of and develop more sophisticated Internet applications. Currently, few companies offer the full range of integrated, comprehensive e-commerce services necessary for clients to fully capitalize on their e-commerce potential. Most companies offering outsourced solutions focus on one or just a few specific services, requiring companies to piece together, or find a third party to integrate, these disparate solutions. Further, speed, accuracy and customer experience are essential in the emerging digital economy. Long implementation lead times in the development and integration of e-commerce solutions offer faster and more efficient competitors market advantages. Most businesses cannot afford to divert internal personnel from their core competencies, while it becomes increasingly difficult to obtain and retain highly skilled in-house personnel to implement these advanced solutions.

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Visual 4: The Zengine Solution

Imagery: Border and Company logo. Gear image with Company logo in center of page with five surrounding gear images containing text.

Visual Text: Title: "The Zengine Solution". Five gear images surrounding center logo are labeled: "Achieve rapid deployment of e-commerce platforms", "Operate a user-friendly e-commerce Web site", "Save on capital expenditures and focus on core competencies", "Increase e-commerce revenues through personalized customer relationship management", "Benefit from our integrated, continual improvements".

Script: (Joseph Savarino) (see "Business--The Zengine Solution"): Zengine addresses the challenges presented by e-commerce by providing a comprehensive suite of technology-based solutions that enable our clients to quickly and cost-effectively create, maintain and enhance their e-commerce presence on an outsourced basis.

Our services enable our clients to quickly establish a fully functional e-commerce environment. Our KORE Engine eliminates the need for months of custom programming and reduces the time needed to integrate the e-commerce application with the client's existing computer systems. As a result, our clients are able to drastically reduce their time-to-market. To date, we have enabled our clients to conduct e-commerce within an average of 40 days after the commencement of our services compared to industry ranges of several months to over one year.

Our technology and infrastructure provide us with the ability to design and operate a client's e-commerce Web site that is: consistent with the look, feel and functionality of our client's existing Web site and brand strategy; engaging, intuitive, attractive and easy to use by the Web site visitor; fast and reliable; highly personalized; able to modify and define the client's services in real time; secured by state-of-the-art procedures that enable execution of transactions involving confidential personal and financial data; and completely integrated with business systems and customer service.

Our clients are able to obtain the benefits of e-commerce without making significant time and financial investments in hardware, software, technical and customer service personnel. We generally provide our solutions from our own premises without interfering with our client's daily operations. This permits our clients to focus on their core competencies and to leverage our knowledge, technology and infrastructure.

We engage in personalized customer relationship management by attempting to optimize each customer visit to our clients' Web sites through the use of real time interactive marketing and by attempting to resolve customer inquiries and complaints as promptly as possible. By gathering real time information, we are able to provide product suggestions, advertisements, incentives and promotions that are likely to be of interest to the visitor. We believe that this personalization of the shopping experience results in a higher user conversion ratio, increased purchases per visit, increased purchase size and greater customer loyalty.

We are engaged in a constant process of technological enhancement of our services. These improvements include the upgrade of our KORE Engine, new merchandising features and advanced browser-based tools. The architecture of KORE is designed to automatically and without interruption distribute our service improvements to our clients without the need to hire consultants, bring the system offline, or install any client-side software. Upon completion, the feature or tool can be made available to other Zengine clients without added development time or costs. Development under the KORE framework contrasts with other e-commerce solutions that provide maintenance and upgrades to custom features on an individual and typically labor intensive basis.

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Visual 5: Strategy

Imagery: Border and Company logo. Circles filled with text heading will be connected to the logo as spokes.

Visual Text: Title: "Strategy". Inside circled spokes: "Target companies seeking to initiate, expand or enhance their ability to conduct e-commerce", "Extend the capabilities of our KORE Engine", "Leverage client base", "Expand our strategic alliances", "Assist our clients in increasing their revenues using our state-of-the-art e-commerce solutions".

Script: (Joseph Savarino) (see "Business--Strategy"): Our objective is to capitalize on our proprietary technology and infrastructure, the KORE Engine, to become the leading provider of comprehensive e-commerce enabling services. To accomplish this goal, we are pursuing a strategy built on the following initiatives:

We target our sales and marketing efforts on companies that are focused on establishing or improving their ability to conduct e-commerce yet lack the technical expertise necessary to build and implement desired Internet functionality. These may include original equipment manufacturers, wholesalers, distributors and other businesses that create customized vendor and supply chain relationships, bricks and mortar retailers, pure online retailers and Web sites with a large and loyal user base (including portals, pure content sites, communities, directories and service providers).

We intend to extend the capabilities of our KORE Engine through continued investment in its development to provide for additional functionality, extending our use of artificial intelligence, and for vertical applications complementary to our current offerings. We intend to develop additional capabilities through continued internal development and, potentially, through the licensing or acquisition of complementary technologies.

One of the distinguishing characteristics of the Zengine business model is the constant level of interaction that Zengine maintains with its clients. Zengine will continue to leverage its network of clients by providing additional services or providing access to its client network. These opportunities may include additional products or services for Zengine to deliver to its network of clients such as relevant content, or may include other opportunities to generate revenue through selling access to its network of clients to outside sponsors or providers.

We currently have strategic business alliances with Excite@Home, United Stationers Supply Co. and MSCi. We plan to continue to develop technology and marketing relationships through strategic alliances with software and systems integrators, consulting firms, advertising firms and other professional services firms. These alliances are intended to complement our direct sales force by providing business leads, increasing our geographic coverage and addressing new industry segments. We also intend to leverage these relationships to commence international sales in countries with high Internet penetration and growth rates.

We intend to enhance the tools our clients use to increase their user to buyer conversion rates, increase the number of products per purchase and the average value of each purchase. Primary tools used in achieving this goal include, increasing the efficiency of our personalization technology and merchandising features, such as development of more robust, real time predictive models.

Visual 6: Services and Tools

Imagery: Border with Company logo. Company logo connected to two rectangles below by two arrows.

Visual Text: Title: "Services and Tools". In the Services rectangle will be in bulleted text: "Web site user interface design and product content", "Merchandising", "Advertising and sponsorship management", "Order management", "Inventory management and order fulfillment" and "End-user

A-5

customer service". In the Tools rectangle will be the bulleted text: "Zengine Reporting and Analysis", "Zengine Content Management", "Zengine Design Center", and "Zengine Call Center".

Script: (Joseph Savarino) (see "Business--Zengine Services and Tools"): Our business service enables original equipment manufacturers, wholesalers and distributors to conduct personalized supply-chain management and customer transactions over the Inernet or secure extranets enabled by Zengine. Our consumer service enables original equipment manufacturers, bricks and mortar retailers, online-only retailers and Web sites with a large and loyal user base, to extend their current business over the Internet. Our services include: Web site user interface design and product content; Merchandising; Advertising and sponsorship management; Order management; Inventory management and order fulfillment and End-user customer service.

Our e-commerce services are customized and maintained using Internet-based tools accessible by our personnel and by our clients. These tools, called KIT (KORE Interactive Tool), are accessible through standard Web browser interfaces. KIT provides a set of building blocks comprised of customizable components, application templates and rule sets. These tools are instrumental in building, rapidly accessing and easily maintaining the Zengine turn-key e-commerce services. Our tools include: Zengine Reporting and Analysis; Zengine Content Management; Zengine Design Center and Zengine Utility Center.

Visual 7: Technology

Imagery: Border and Company logo.

Visual Text: Title: "Technology". Subhead: "Key Technology Components:". In gear image bullets, "The KORE Engine", "KORE Personalization", "Network Architecture", "Open Source Movement".

Script: (Joseph Savarino) (see "Business--Technology and Infrastructure"):
Our technology is based on the following four key components. Our proprietary technology and infrastructure, the KORE Engine, enables us to build, deliver and manage e-commerce solutions in less time and more cost effectively than existing alternatives. The functional components of KORE are stored on a centralized server array which services all of our e-commerce clients. This architecture minimizes development costs and reduces time to market because we are able to leverage existing functionality previously developed within KORE rather than re-engineering the functionality for each application. Development within the KORE framework significantly differs from other e-commerce solutions that provide maintenance and upgrades to custom features on an individual and possibly labor intensive basis.

KORE resides on a secure, private fault-tolerant network architecture that provides highly reliable service. This is accomplished by distributing Internet traffic across an array of servers that are scalable and redundant. Because of this distributed model, rapid increases in server load can be quickly scaled by allocating more servers to immediately accommodate client Web site demand. In addition, our redundant network architecture allows for unpredictable hardware failure with little effect to service because the failure merely results in the balanced distribution of server load across the server array.

In order to maximize both personalization and speed of service, we choose to adhere to open source standards and scalable programming languages. Development within KORE is done in Perl5, a widely accepted standard programming language for developing object oriented software that is the informed choice for building large-scale e-commerce platforms that require ongoing and rapid development and high-speed dynamically-generated Web site operations. MySQL, an open source database, is optimized for speed and scalability and serves as the foundation for KORE's personalized capabilities. KORE creates multiple database connections for multiple actions both efficiently and quickly, resulting in high-speed dynamic Web site delivery.

Visual 8: Competition

Imagery: Border and Company logo.

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Visual Text: Title: "Competition". Subhead: "Primary Source of Competition:". In gear image bullets, "Companies who develop their own e-commerce system", "Internet consulting companies".

Script: (Joseph Savarino) (see "Business--Competition"): The market for our services is intensely competitive and subject to rapid technological change. We expect competition to intensify in the future. Our primary source of competition comes from companies who develop their own custom e-commerce systems or purchase software packages and hire consultants to implement these solutions. Because these companies have likely made significant initial investments to develop their custom systems, they may be less likely to employ outsourced transaction processing strategies. We also face competition from companies such as Art Technology Group, Breakaway Solutions, Broadvision, E.piphany, Net Perceptions and USinternetworking. In addition, other companies may enter the market to provide similar services. We compete on the basis of certain factors, including:
technology; time-to-market; breadth of service features and functionality; ease of implementation; speed, accessibility and ease of use; brand recognition; price; system reliability and capacity; and customer support. We believe that we presently compete favorably with respect to each of these factors. However, the market for our services is still rapidly evolving, and we may not be able to compete successfully against current and potential competitors.

And with that, I will turn it over to Louis Lipinski for an overview of our financial results. Louis. . .

A-7

Visual 9: Financial Summary

Imagery: Border and Company Logo. Two gear images are located on the center-left side of the page.

Visual Text: Title: "Financial Summary." Subhead: "Revenue". In gear image bullets, "Service Fees", with three sub-text bulleted lines reading:
"Integration and Set-up Fees", "Subscription Fees", "Transaction Fees". Second gear image bulleted text reads: "Advertising and Sponsorship Fees".

Script: (Louis Lipinski) (See "Management's Discussion and Analysis of Financial Condition and Results of Operations"): Thanks, Joe. We were formed as a division of MCSi in January 1999 to sell computer and audio-visual products, primarily to the small office/home office market. We were subsequently incorporated as a wholly owned subsidiary of MCSi in March 1999. Also in March 1999, we hired three key executives, Mr. Joseph Savarino, Mr. Lalit Dhadphale and Mr. Christopher Feaver, to revise our business concept beyond the sale of computer and audio-visual products to the Zengine business model of providing a full range of e-commerce services to the B2B and B2C markets. We entered into our first third party client contract using the Zengine business model in September 1999, and we legally changed our corporate name to Zengine, Inc. in the Fall of 1999, after doing business as Zengine since March 1999.

In performing our services under the Zengine business model, we enter into contractual arrangements with our clients that describe the services we will perform. We generate revenues through service fees, which include integration and set-up, monthly subscription, transaction and product content fees and from advertising and sponsorships on Web pages we service on our client's stores.

We provide integration and set-up services to our clients. Under these arrangements, our services may include the development or design of a client's Web site, migration of the client's current Web site content to our technology, integration of the client's Web site to the client's current computer systems or other similar activities. To the extent that these fees are associated with a contract to provide subsequent outsourced transaction-based services to a client, these fees are recognized ratably over the term of the transaction services agreement. Otherwise, revenue is recognized when the service is completed, the client has accepted the service and we have no future obligation to provide any additional services. Our subscription arrangements provide for maintenance and related services over a specified time for a fee. Revenue from subscription fees is recognized ratably over the term of the subscription. We provide outsourced transaction-based services to customers, such as providing product content and merchandising, transaction processing, order management, custom fulfillment and end-user customer service. Revenues from transaction fees are generally in the form of a commission. Under our first two arrangements with third-party clients, our revenue is determined as a percentage of the gross margin on revenues. Under all other arrangements entered into between our clients and us, our revenue is based on a percentage of net revenues. Revenue from transaction fees is recognized when the service is completed. Revenues from advertising take the form of fees when we sell banner advertising, product placement or other forms of advertising on Web pages we service on our clients' stores. These arrangements call for continuous advertising or product placement over a certain time period and are not contingent upon events such as obtaining certain levels of sales, Web site visits or other factors. Revenue is recognized ratably over the period of the advertising or product placement services based on the fulfillment of obligations under the advertising or product placement arrangements.

    Visual 10:    Financial Summary



    Imagery:     Border and Company Logo. See "Selected Historical and Pro Forma
Financial Data".


    Visual Text:   Title: "Financial Summary".

A-8

Script: (Louis Lipinski) (See "Management's Discussion and Analysis of Financial Condition and Results of Operations" and see "Risk Factors--Risks Related to Our Business"): During September 1999, we signed our first client contract under the Zengine business model, and we began earning revenue from this contract in October 1999. Accordingly, our historic financial results prior to October 1, 1999 are not representative of our current business model. We have not presented amounts for the six month period ended March 31, 1999 as we were not in existence for that period and were not operating under our current business model. Accordingly, prior period amounts from our inception (January 1, 1999) to March 31, 1999 are not meaningful or comparable.

Our revenue for the nine months ended June 30, 2000 totaled $5,104,286. At June 30, 2000, we had 12 e-commerce clients. Service fee revenue from the MCSi dedicated Web sites was $2,408,121 for the nine months ended June 30, 2000, which was 47.1% of our total revenue for the period. Our current arrangement to service the MCSi dedicated Web sites expires on October 1, 2001. In addition, we had advertising revenue of $2,336,750, or 45.8% of total revenue, which was primarily derived from OEM product advertisers who either placed banner advertisements on a client's Web pages which we serve, or purchased preferential placement of the OEM manufacturers products on a client's stores. MCSi has supply arrangements with the OEM companies that purchase advertising from us. We have provided advertising or sponsorship services to 14 clients as of June 30, 2000. Although we negotiate each OEM advertising arrangement, MCSi's relationship with the OEM companies could have influenced our obtaining the advertising and we may not have obtained the advertising without MCSi's relationship.

Our revenue for the three months ended June 30, 2000 totaled $2,393,370. Service fee revenue from the MCSi dedicated Web sites was $1,098,293 for the three months ended June 30, 2000, which was 45.9% of our total revenue for the period. In addition, we had advertising revenue of $987,500 or 41.3% of total revenue, which was primarily derived from OEM product advertisers who either placed banner advertisements on a client's Web pages which we serve, or purchased preferential placement of the OEM manufacturers products on a client's store.

Our revenue for the six months ended March 31, 2000 totaled $2,710,916. During the six months ended March 31, 2000, we initiated our Zengine service offerings and began servicing e-commerce clients. At March 31, 2000 we had seven e-commerce clients.

Service fee revenue from the MCSi dedicated Web sites was $1,309,828 for the six months ended March 31, 2000, which was 48.3% of our total revenue for the period. In addition, we had advertising revenue of $1,349,250, or 49.8% of total revenue, which was primarily derived from OEM product advertisers who either placed banner advertisements on client's Web pages which we serve, or purchased preferential placement of the OEM manufacturers products on client's stores.

From the date of our inception to September 30, 1999, our revenues totaled $4,089. These revenues arose from the sale of computer supply and audio-visual products to consumers under our previous business model.

Our cost of revenue includes the amortization of capitalized computer software costs, the costs of our employees to perform integration and other services and the three percent fee we pay to MCSi under the distribution services agreement, which expires on October 1, 2001. As a percentage of our revenues, cost of revenues was 89.9% for the nine months ended June 30, 2000, 90.5% for the three months ended June 30, 2000, and 89.4% for the six months ended March 31, 2000, all under our business model. These percentages fluctuate depending primarily on the timing as to when we add additional employees to perform integration and other services.

Our costs of revenues were $23,511 for the period ended September 30, 1999 and reflects costs we incurred for the products we sold arising from the activities of our previous business model and the amortization of capitalized computer software costs.

A-9

Selling, general and administrative expenses for the periods presented, along with these amounts stated as a percentage of our revenues during the periods we operated under the Zengine business model, is shown below:

Nine months ended June 30, 2000..........................  $4,789,706    100.1%
Three months ended June 30, 2000.........................  $2,457,504    105.5%
Six months ended March 31, 2000..........................  $2,337,202     95.5%

Changes in selling, general and administrative expenses are also influenced as to the timing of when we add additional personnel to support these functions. Our Selling, general and administrative costs during the nine months and three months ended June 30, 2000 was also impacted by an amendment to our distribution services agreement with MCSi which totalled $326,751.

Selling, general and administrative expenses also include $520,875 of accretion expense associated with a put agreement written by MCSi, which will terminate upon consumation of this initial public offering.

Our selling, general and administrative expenses for the nine months ended September 30, 1999 were $914,201 and relate primarily to costs incurred to develop the Zengine business model. The more significant selling, general and administrative expenses relate to payroll and accounting processing costs, salaries and rent.

We did not provide for any income taxes because we have prepared our provision for income taxes as if we were a separate entity. We do not owe any income taxes because we have incurred operating losses since our inception, and we did not record any deferred tax benefits relating to these operating losses or any other deferred tax benefits because we presently believe it is more likely than not that they will not be realized.

We incurred net losses of $934,000 for the period from inception to (January 1, 1999) to September 30, 1999, and net losses of $76,000 for the nine months ended June 30, 2000. We anticipate that we will substantially increase our sales and marketing, technology and infrastructure, software and development and general and administrative expenses in fiscal 2000 and, as a result, we expect to incur additional losses for the foreseeable future.

Joe...

Visual 11: End of Presentation

Imagery: See Description of Artwork on inside back cover of the Registration Statement for a description of the image located on the inside back cover of the prospectus.

Script: (Joseph Savarino): We hope that this presentation was helpful in understanding the Zengine business model and the strategy that our management team intends to execute. We encourage you to refer back to the prospectus for additional support and disclosure as well as to take a look at the "Risk Factors" in detail. Again, thank you for your interest in Zengine.

-END-

A-10

[Graphic--Inside Back Cover--In the upper left hand corner is the Zengine logo consisting of the word "zengine" with the gear cogs making up the letter "g," and a line under the word from the right to the left margin.

On the left hand side of the page is the text as follows:

"KIT (KORE INTERACTIVE TOOL)

Zengine's KIT (KORE Interactive Tools) is a set of Web-based tools used by Zengine and its clients to manage the administration of client platforms. Included within KIT are inventory management, campaign management, call center management, and reporting and analysis tools.

REPORTING AND ANALYSIS

KIT generates client-specific reports and enables clients to track their platform's performance in real time. The reporting and analysis tools record all measurable Web site activity, including customer behavior, sales trends, per-page statistics, referrals from prior pages, search results, click- trail analysis and repeat-user behavior."

A solid delta points to the screen shot, described below.

On the right hand side of the page is a screen shot of samples of the charts and graphs generated by the Zengine reporting and analysis tools.

In the center of the page on the left hand side of the page is a screen shot of the tracking and analysis of an advertising campaign provided by the Zengine reporting and analysis tools. On the right hand side of the page is the text as follows:

"CAMPAIGN MANAGEMENT

Client advertising and sponsorship campaigns can be tracked and analyzed in real time. Client-specific campaign management functionality includes discount and voucher creation and reporting, advertising message reporting, e-mail marketing creation and reporting, and promotional offer creation and reporting."

A solid delta points to the above described screen shot.

Below that, on the left hand side of the page is the following text:

"CALL CENTER AND CUSTOMER MANAGEMENT

KIT displays real-time customer information for call center representatives and general customer service management. Customer purchase history and past interaction data are available to authorized representatives, as well as a customer's current shopping cart items for assistance during checkout."

A solid delta points to the screen shot, described below.

On the left hand side of the page is a screen shot of the customer call log available to Zengine customer service representatives.

Under that are two horizontal lists of Zengine's clients. The top list is:
InFocus, the KaBloom logo, the Lexmark logo, Maxell, MCSi and its logo, Mitsubishi Electronic and its logo, and NEC. The bottom list of Zengine's clients are: the Sanyo logo, SHARP, SONY, the Talk City logo, Toshiba, the Universal logo and the Work.com logo. Under this line is the word "Clients" followed by a solid delta pointing to the list.




YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROSPECTUS. WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH INFORMATION DIFFERENT FROM THAT WHICH IS SET FORTH IN THIS PROSPECTUS. WE ARE OFFERING TO SELL SHARES OF COMMON STOCK AND SEEKING OFFERS TO BUY SHARES OF COMMON STOCK ONLY IN JURISDICTIONS WHERE OFFERS AND SALES ARE PERMITTED. THE INFORMATION CONTAINED IN THIS PROSPECTUS IS ACCURATE ONLY AS OF THE DATE OF THIS PROSPECTUS, REGARDLESS OF THE TIME OF DELIVERY OF THE PROSPECTUS OR OF ANY SALE OF COMMON STOCK.


UNTIL , 2000 (25 DAYS AFTER THE DATE OF THIS PROSPECTUS), ALL DEALERS

EFFECTING TRANSACTIONS IN THE REGISTERED SECURITIES, WHETHER OR NOT PARTICIPATING IN THIS DISTRIBUTION, MAY BE REQUIRED TO DELIVER A PROSPECTUS. THIS IS IN ADDITION TO THE OBLIGATION OF DEALERS TO DELIVER A PROSPECTUS WHEN

ACTING AS UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS.

4,290,000 SHARES

[LOGO]

COMMON STOCK


PROSPECTUS

, 2000


WILLIAM BLAIR & COMPANY
FRIEDMAN BILLINGS RAMSEY
E*OFFERING
MORGAN KEEGAN & COMPANY, INC.




PART II
INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

The following table sets forth the costs and expenses, other than underwriting discounts and commissions, payable in connection with the sale and distribution of the securities being registered. All amounts are estimated except the Securities and Exchange Commission registration fee and the NASD registration fee.

ITEM                                                            AMOUNT
----                                                          ----------
Securities and Exchange Commission registration fee.........  $   19,305
NASD registration fee.......................................       6,500
Nasdaq Stock Market listing fees............................      15,000
Blue Sky qualification fees and expenses....................       5,000
Legal fees and expenses.....................................     300,000
Accounting fees and expenses................................     450,000
Transfer agent and registrar fees...........................      20,000
Printing and engraving expenses.............................     300,000
Miscellaneous expenses......................................      84,195
                                                              ----------
      Total.................................................  $1,200,000
                                                              ==========

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS

Zengine is incorporated under the laws of the State of Delaware.
Section 145 ("Section 145") of the General Corporation Law of the State of Delaware (the "General Corporation Law") provides that a Delaware corporation may indemnify any persons who were, are or are threatened to be made, parties to any threatened pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of such corporation), by reason of the fact that such person is or was an officer, director, employee or agent of such corporation, or is or was serving at the request of such corporation as a director, officer, employee or agent of another corporation or enterprise. The indemnity may include expenses (including attorneys' fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding, provided such person acted in good faith and in a manner he reasonably believed to be in or not opposed to the corporation's best interests and, with respect to any criminal action or proceeding, had no reasonable cause to believe that his conduct was illegal.

Section 145 further authorizes a corporation to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation or enterprise, against any liability asserted against him and incurred by him in any such capacity, arising out of his status as such, whether or not the corporation would otherwise have the power to indemnify him under Section 145.

Zengine's amended and restated certificate of incorporation and amended and restated bylaws provide for the indemnification of officers and directors to the fullest extent permitted by the General Corporation Law.

Zengine anticipates that all of its directors and officers will be covered by insurance policies against certain liabilities for actions taken in their capacities as such, including liabilities under the Securities Act of 1933, as amended.

II-1


ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES

Since the Registrant's incorporation on March 2, 1999, it has issued unregistered securities to a limited number of persons as described below:

(1) In connection with its incorporation, the Registrant issued 67,686 shares of common stock to MCSi for an aggregate of $1,000, and other non-monetary consideration.

(2) On September 14, 1999, the Registrant issued 676,860 shares of common stock to each of Joseph M. Savarino, Lalit P. Dhadphale and Christopher Feaver, pursuant to employment agreements entered into between the recipients and the Registrant in March, 1999 and 10,762,074 shares to MCSi for non-monetary consideration, 2,481,816 of which shares were surrendered back to the Registrant on September 29, 1999.

(3) On October 1, 1999, the Registrant sold 902,478 shares of common stock to Wilblairco Associates for $2.0 million.

(4) On October 1, 1999, the Registrant sold 902,478 shares of common stock to At Home Corporation for $2.0 million.

(5) On January 21, 2000, in connection with the transactions contemplated by a software services agreement with rexstores.com, Inc. and REX Stores Corporation, the Registrant agreed to issue a warrant to REX Stores Corporation to purchase the number of shares of common stock that is equal to 1.7 percent of the number of shares outstanding on the day immediately following the date on which this offering is completed (not including the underwriters' overallotment option). The per share exercise price of the warrant equals the initial public per share offering price of this offering.

On September 29, 1999, the Registrant effected a 10-for-1 split of its common stock. In addition, the Registrant intends to effect a 6.7686-for-1 split of its common stock prior to consummation of the offering. The number of shares described in this Item 15 reflects such stock splits.

The Registrant believes that all of the above issuances were exempt from registration under Section 4(2) of the Securities Act as transactions not involving any public offering.

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a) Exhibits

       EXHIBIT
       NUMBER                                   DESCRIPTION
---------------------   ------------------------------------------------------------
              1.1       Form of Underwriting Agreement

              1.2       Standby Stock Purchase Agreement*

              1.3       Form of Lock up Agreement

              3.1       Amended and Restated Certificate of Incorporation*

              3.2       Amended and Restated Bylaws*

              4.1       Form of Common Stock Certificate of Zengine*

              4.2       Form of Warrant to Purchase Common Stock of Zengine*

              5.1       Opinion of Elias, Matz, Tiernan & Herrick L.L.P.

             10.1       Amended and Restated 1999 Stock Option Plan*

             10.2       Form of 2000 Employee Stock Purchase Plan*

             10.3       Administrative Services Agreement by and between MCSi and
                        Zengine dated as of October 1, 1999*

II-2


       EXHIBIT
       NUMBER                                   DESCRIPTION
---------------------   ------------------------------------------------------------
             10.4       Distribution Services Agreement by and between MCSi and
                        Zengine dated as of October 1, 1999*

             10.4.1     Amendment to Distribution Services Agreement by and between
                        MCSi and Zengine dated June 1, 2000

             10.4.2     Amendment to Distribution Services Agreement by and between
                        MCSi and Zengine dated August 17, 2000

             10.5       Sublease and Equipment Lease Agreement by and between MCSi
                        and Zengine dated as of October 1, 1999*

             10.6       Stock Purchase Agreement by and among Zengine, MCSi and
                        certain listed purchasers dated as of September 30, 1999*

             10.7       Registration Rights Agreement by and among Zengine, MCSi and
                        certain investors and founders dated as of September 30,
                        1999*

             10.7.1     Amendment dated April 6, 2000 to Registration Rights
                        Agreement by and among Zengine, MCSi and certain investors
                        and founders dated September 30, 1999

             10.8       Stockholders Agreement by and among Zengine, MCSi and
                        certain investors and option holders dated as of
                        September 30, 1999*

             10.8.1     Amendment and Addendum dated April 6, 2000 to Stockholder's
                        Agreement by and among Zengine, MCSi and certain investors
                        and option holders dated September 30, 1999.

             10.9       E-commerce Services Agreement by and between MCSi and
                        Zengine dated October 1, 1999*

             10.10      Employment Agreement by and between Zengine, Inc. and Joseph
                        M. Savarino dated March 1, 1999*

             10.11      Employment Agreement by and between Zengine, Inc. and Latit
                        Dhadphale dated March 15, 1999*

             10.12      Employment Agreement by and between Zengine, Inc. and
                        Christopher Feaver dated March 8, 1999*

             10.13      Strategic Alliance Agreement by and among United Stationers
                        Supply Co. and Zengine dated as of April 3, 2000.

             23.1       Consent of PricewaterhouseCoopers LLP

             23.2       Consent of Elias, Matz, Tiernan & Herrick L.L.P. (included
                        in Exhibit 5.1)

             24.1       Power of Attorney (contained on Page II-5 to original filing
                        of registration statement)*

             27.1       Financial Data Schedule

             99.1       Form of letter from Zengine to holders of more than 100
                        shares of MCSi common stock describing the MCSi Subscription
                        Program*

             99.2       Form of letter from William Blair & Company to MCSi
                        stockholders*

             99.3       Form of letter from Zengine to brokers describing the MCSi
                        Subscription Program*

             99.4       Form of Subscription Form for MCSi Subscription Program*

             99.5       Consent of Work.com

             99.6       Consent of rexstores.com, Inc.

             99.7       Consent of MCSi, Inc.

             99.8       Form of MCSi Subscription Program Web site presentation*


* Previously filed.

II-3


(b) Financial Statement Schedules

Schedules have been omitted because the information required to be set forth therein is not applicable, is immaterial or is shown in the financial statements included in the prospectus.

ITEM 17. UNDERTAKINGS

The undersigned Registrant hereby undertakes to provide to the underwriters at the closing specified in the underwriting agreement, certificates in such denominations and registered in such names as required by the underwriters to permit prompt delivery to each purchaser.

Insofar as the indemnification for liabilities arising under the Securities Act of 1933 may be permitted as to directors, officers and controlling persons of the Registrant pursuant to the provisions described in Item 14, or otherwise, the Registrant has been advised that in the opinion of the SEC, such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payments by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

The undersigned Registrant hereby undertakes that:

(1) for purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective; and

(2) for the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and this offering of such securities at that time shall be deemed to be the initial BONA FIDE offering thereof.

II-4


SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Fremont, State of California, on August 21, 2000.

           /S/ JOSEPH M. SAVARINO
---------------------------------------------
             Joseph M. Savarino
    PRESIDENT AND CHIEF EXECUTIVE OFFICER

Pursuant to the requirements of the Securities Act of 1933, this amended Registration Statement has been signed by the following persons in the capacities and on the dates indicated.

                 SIGNATURE                                    TITLE                    DATE
                 ---------                                    -----                    ----
           /s/ MICHAEL E. PEPPEL                  Chairman of the Board
-------------------------------------------                                       August 21, 2000
             Michael E. Peppel

                                                  President, Chief Executive
          /s/ JOSEPH M. SAVARINO                    Officer and Director
-------------------------------------------         (Principal Executive          August 21, 2000
            Joseph M. Savarino                      Officer)

                                                  Vice President, Chief
          /s/ LOUIS T. LIPINSKI*                    Financial Officer, Treasurer
-------------------------------------------         and Secretary (Principal      August 21, 2000
             Louis T. Lipinski                      Financial and Accounting
                                                    Officer)

         /s/ ANTHONY W. LIBERATI*                 Director
-------------------------------------------                                       August 21, 2000
            Anthony W. Liberati

         /s/ DONALD B. HUTCHISON*                 Director
-------------------------------------------                                       August 21, 2000
            Donald B. Hutchison

          /s/ RICHARD V. HOPPLE*                  Director
-------------------------------------------                                       August 21, 2000
             Richard V. Hopple

            /s/ STACEY SNIDER*                    Director
-------------------------------------------                                       August 21, 2000
               Stacey Snider


* By Michael E. Peppel, his or her attorney-in-fact.

II-5


EXHIBIT 1.1

ZENGINE, INC.

_____ Shares Common Stock(1)

UNDERWRITING AGREEMENT

_______________, 2000

William Blair & Company, L.L.C.
Friedman, Billings, Ramsey & Co., Inc.
E*OFFERING Corp.
Morgan Keegan & Company, Inc.
As Representatives of the Several
Underwriters Named in Schedule A
c/o William Blair & Company, L.L.C.
222 West Adams Street
Chicago, Illinois 60606
Ladies and Gentlemen:

SECTION 1. INTRODUCTORY. Zengine, Inc. ("COMPANY"), a Delaware corporation, has an authorized capital stock consisting of 20,000,000 shares of Preferred Stock, no par value, of which no shares were outstanding as of ____________, 2000 and 100,000,000 shares, no par value, of Common Stock ("COMMON STOCK"), of which [1,800,000 PRE-SPLIT] shares were outstanding as of such date. The Company proposes to issue and sell _______ shares of its authorized but unissued Common Stock to the several underwriters named in Schedule A as it may be amended by the Pricing Agreement hereinafter defined ("UNDERWRITERS"), who are acting severally and not jointly. Such total of ___________ shares of Common Stock proposed to be sold by the Company is hereinafter referred to as the "FIRM SHARES." In addition, the Company proposes to grant to the Underwriters an option to purchase up to ________ additional shares of Common Stock ("OPTION SHARES") as provided in Section 4 hereof. The Firm Shares and, to the extent such option is exercised, the Option Shares, are hereinafter collectively referred to as the "SHARES." William Blair and Company, L.L.C. ("Blair") has the authority, subject to the terms and conditions contained herein, to act on behalf of the several Underwriters and the Representatives hereunder.

The Company also proposes to issue and sell an aggregate of ___________ shares ("MCSI SHARES") of Common Stock directly to certain stockholders of MCSi, Inc., a Maryland corporation and parent of the Company ("MCSI"), or, if all such MCSi Shares are not a so purchased by MCSi stockholders, then the Company shall issue and sell such unpurchased MCSi Shares to MCSi ("MCSi SUBSCRIPTION PROGRAM").

You have advised the Company that the Underwriters propose to make a public offering (the "Offering") of their respective portions of the Shares as soon as you deem advisable after the


(1) Plus an option to acquire up to ____ additional shares to cover overallotments.

1

registration statement hereinafter referred to becomes effective, if it has not yet become effective, and the Pricing Agreement hereinafter defined has been executed and delivered.

Prior to the purchase and public offering of the Shares by the several Underwriters, the Company and the Representatives, acting on behalf of the several Underwriters, shall enter into an agreement substantially in the form of Exhibit A hereto ("PRICING AGREEMENT"). The Pricing Agreement may take the form of an exchange of any standard form of written telecommunication between the Company and the Representatives and shall specify such applicable information as is indicated in Exhibit A hereto. The offering of the Shares will be governed by this Agreement, as supplemented by the Pricing Agreement. From and after the date of the execution and delivery of the Pricing Agreement, this Agreement shall be deemed to incorporate the Pricing Agreement.

The Company hereby confirms its agreement with the Underwriters as follows:

SECTION 2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND MCSi. Each of the Company and MCSi represents and warrants to the several Underwriters that as of the date hereof:

(a) A registration statement on Form S-1 (File No. 333-36312) and a related preliminary prospectus with respect to the Shares have been prepared and filed with the Securities and Exchange Commission ("COMMISSION") by the Company in conformity with the requirements of the Securities Act of 1933, as amended, and the rules and regulations of the Commission thereunder (collectively, the "1933 ACT;" unless indicated to the contrary, all references herein to specific rules are rules promulgated under the 1933 Act); and the Company has so prepared and has filed such amendments thereto, if any, and such amended preliminary prospectuses as may have been required to the date hereof and will file such additional amendments thereto and such amended prospectuses as may hereafter be required. There have been or will promptly be delivered to you a signed copy of such registration statement and amendments, a copy of each exhibit filed therewith, and conformed copies of such registration statement and amendments (but without exhibits) and of the related preliminary prospectus or prospectuses and final forms of prospectus for each of the Underwriters.

Such registration statement (as amended, if applicable) at the time it becomes effective and the prospectus constituting a part thereof (including the information, if any, deemed to be part thereof pursuant to Rule 430A(b) and/or Rule 434), as from time to time amended or supplemented, are hereinafter referred to as the "REGISTRATION STATEMENT," and the "PROSPECTUS," respectively, except that if any revised prospectus shall be provided to the Underwriters by the Company for use in connection with the offering of the Shares which differs from the Prospectus on file at the Commission at the time the Registration Statement became or becomes effective (whether or not such revised prospectus is required to be filed by the Company pursuant to Rule 424(b)), the term Prospectus shall refer to such revised prospectus from and after the time it was provided to the Underwriters for such use. If the Company elects to rely on Rule 434 of the 1933 Act, all references to "Prospectus" shall be deemed to include, without limitation, the form of prospectus and the term sheet, taken together, provided to the

2

Underwriters by the Company in accordance with Rule 434 of the 1933 Act ("RULE 434 PROSPECTUS"). Any registration statement (including any amendment or supplement thereto or information which is deemed part thereof) filed by the Company under Rule 462(b) ("RULE 462(B) REGISTRATION STATEMENT") shall be deemed to be part of the "Registration Statement" as defined herein, and any prospectus (including any amendment or supplement thereto or information which is deemed part thereof) included in such Rule 462(b) Registration Statement shall be deemed to be part of the "Prospectus", as defined herein, as appropriate. The Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission thereunder are hereinafter collectively referred to as the "EXCHANGE ACT."

(b) The Commission has not issued any order preventing or suspending the use of any preliminary prospectus, and each preliminary prospectus has conformed in all material respects with the requirements of the 1933 Act and, as of its date, has not included any untrue statement of a material fact or omitted to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; and when the Registration Statement became or becomes effective, and at all times subsequent thereto, up to the First Closing Date or the Second Closing Date hereinafter defined, as the case may be, the Registration Statement, including the information deemed to be part of the Registration Statement at the time of effectiveness pursuant to Rule 430A(b), if applicable, and the Prospectus and any amendments or supplements thereto, contained or will contain all statements that are required to be stated therein in accordance with the 1933 Act and in all material respects conformed or will in all material respects conform to the requirements of the 1933 Act, and neither the Registration Statement nor the Prospectus, nor any amendment or supplement thereto, included or will include any untrue statement of a material fact or omitted or will omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; provided, however, that the Company makes no representation or warranty as to information contained in or omitted from any preliminary prospectus, the Registration Statement, the Prospectus or any such amendment or supplement in reliance upon and in conformity with written information furnished to the Company by or on behalf of any Underwriter through the Representatives specifically for use in the preparation thereof.

(c) The Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of the State of Delaware, with corporate power and authority to own its properties and conduct its business as described in the Prospectus; the Company is duly qualified to do business as a foreign corporation under the corporation law of, and are in good standing as such in, each jurisdiction in which it owns or leases properties, has an office, or in which business is conducted and such qualification is required except in any such case where the failure to so qualify or be in good standing would not have a material adverse effect upon the business, condition (financial or otherwise) or results of operations of the Company taken as a whole (a "MATERIAL ADVERSE EFFECT"); and no proceeding of which the Company has knowledge has been instituted in any such jurisdiction, revoking, limiting or curtailing, or seeking to revoke, limit or curtail, such power and authority or qualification. MCSi has been duly

3

incorporated and is validly existing as a corporation in good standing under the laws of the State of Maryland.

(d) The Company does not, directly or indirectly, (i) own, of record or beneficially, any outstanding voting securities or other equity interests in any corporation, partnership, limited liability company, joint venture or other entity or (ii) control any corporation, partnership, limited liability company, joint venture or other entity.

(e) The issued and outstanding shares of capital stock of the Company as set forth in the Prospectus have been duly authorized and validly issued, are fully paid and nonassessable, and conform in all material respects to the description thereof contained in the Prospectus.

(f) The Shares and the MCSi Shares to be sold by the Company have been duly authorized and when issued, delivered and paid for pursuant to this Agreement, will be validly issued, fully paid and nonassessable, and will conform in all material respects to the description thereof contained in the Prospectus.

(g) The making and performance by the Company and MCSi of this Agreement, the Pricing Agreement and all agreements relating to the obligations of the Company and MCSi under the MCSi Subscription Program (the "MCSi SUBSCRIPTION AGREEMENTS") have been duly authorized by all necessary corporate action and (i) will not violate any provision of the charter or bylaws of the Company or MCSi and (ii) except for such violations, breaches or defaults which would not have a Material Adverse Effect on the Company, taken as a whole, will not result in the breach, or be in contravention, of any provision of any agreement, franchise, license, indenture, mortgage, deed of trust, or other instrument to which the Company or MCSi is a party or by which the Company, MCSi or the property of either of them may be bound or affected, or any order, rule or regulation applicable to the Company or MCSi of any court or regulatory body, administrative agency or other governmental body having jurisdiction over the Company or MCSi or any of their respective properties, or any order of any court or governmental agency or authority entered in any proceeding to which the Company or MCSi was or is now a party or by which it is bound. No consent, approval, authorization or other order of any court, regulatory body, administrative agency or other governmental body is required for the execution and delivery of this Agreement, the Pricing Agreement or the MCSi Subscription Agreements or the consummation of the transactions contemplated herein or therein, except for compliance with the 1933 Act, the declaration of the effectiveness of the Registration Statement by the Commission, and blue sky laws and clearance of such offering with the National Association of Securities Dealers, Inc. ("NASD"). This Agreement and the MCSi Subscription Agreements have been duly executed and delivered by the Company and MCSi.

(h) The accountants who have expressed their opinions with respect to the audited financial statements included in the Prospectus are independent accountants as required by the 1933 Act.

4

(i) The financial statements of the Company included in the Registration Statement present fairly the financial position of the Company as of the respective dates of such financial statements, and the statements of operations, cash flows and changes in stockholders' equity of the Company for the respective periods covered thereby, all in conformity with generally accepted accounting principles consistently applied throughout the periods involved, except as disclosed in the Prospectus, The historical financial information set forth in the Prospectus under "Selected Historical Financial Data" presents fairly, on the basis stated in the Prospectus, the information set forth therein.

(j) The Company is not in violation of its certificate of incorporation or in default under any consent decree, or in default with respect to any material provision of any lease, loan agreement, franchise, license, permit or other contract obligation to which it is a party; and there does not exist any state of facts which constitutes an event of default as defined in such documents or which, with notice or lapse of time or both, would constitute such an event of default, in each case, except for defaults which neither singly nor in the aggregate would have a Material Adverse Effect.

(k) There are no material legal or governmental proceedings pending, or to the Company's knowledge, threatened to which the Company is or may be a party or of which material property owned or leased by the Company is or may be the subject, or related to environmental or discrimination matters which are not disclosed in the Prospectus, or which question the validity of this Agreement or the Pricing Agreement or any action taken or to be taken pursuant hereto or thereto.

(l) There are no holders of securities of the Company having rights to registration thereof or preemptive rights to purchase Common Stock except as disclosed in the Prospectus. Holders of registration rights have waived such rights with respect to the offering being made by the Prospectus.

(m) The Company has good and marketable title to all the properties and assets reflected as owned in the financial statements hereinabove described (or elsewhere in the Prospectus), subject to no lien, mortgage, pledge, charge or encumbrance of any kind except those, if any, reflected in such financial statements (or elsewhere in the Prospectus) or which are not material to the Company. To the Company's knowledge, the Company holds its leased properties which are material to the Company under valid and binding leases.

(n) The Company has not taken and will not take during the Offering (including any time after the effective date of the Registration Statement during which the Underwriters are deemed to be making a public offering), directly or indirectly, any action designed to or which has constituted or which might reasonably be expected to cause or result, under the Exchange Act or otherwise, in stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Shares (provided, however, that the Company may purchase shares under the 2000 Employee Stock Purchase Plan and any 401(k) plan instituted by the Company in the future, and to the extent that the offering is not a "Qualified Initial Public Offering" under the Stockholders Agreement by and among Wilblairco Associates, At Home Corporation,

5

MCSi and Messrs. Savarino, Dhadphale and Feaver dated September 29, 1999, MCSi may be required to exercise its put agreement dated September 29, 1999 with Wilblairco Associates and At Home Corporation).

(o) Subsequent to the respective dates as of which information is given in the Registration Statement and Prospectus, and except as contemplated by the Prospectus, to the date hereof, the Company has not incurred any material liabilities or obligations, direct or contingent, nor entered into any material transactions not in the ordinary course of business and there has not been any material adverse change in its condition (financial or otherwise) or results of operations taken as a whole nor any material change in its capital stock, short-term debt or long-term debt.

(p) There is no material document of a character required by the 1933 Act to be described in the Registration Statement or the Prospectus or to be filed as an exhibit to the Registration Statement which is not described or filed as required.

(q) The Company owns and possesses all right, title and interest in and to, or has duly licensed from third parties, all trademarks, copyrights and other proprietary rights ("TRADE RIGHTS") material to the business of the Company as described in the Prospectus. Except as disclosed in the Prospectus, the Company has not received any notice of infringement, misappropriation or conflict from any third party as to such material Trade Rights which has not been resolved or disposed of, and the Company has not infringed, misappropriated or otherwise conflicted with material Trade Rights of any third parties, which infringement, misappropriation or conflict would have a Material Adverse Effect on the Company taken as a whole.

(r) The conduct of the business of the Company is in compliance in all respects with applicable federal, state, local and foreign laws and regulations, except where the failure to be in compliance would not have a Material Adverse Effect on the Company taken as a whole.

(s) All offers and sales of the Company's capital stock prior to the date hereof were at all relevant times exempt from the registration requirements of the 1933 Act and were duly registered with or the subject of an available exemption from the registration requirements of the applicable state securities or blue sky laws.

(t) The Company has filed all necessary federal and state income and franchise tax returns and has paid all taxes shown as due thereon, and there is no tax deficiency that has been asserted in writing, or to the knowledge of the Company may be, asserted against the Company or any of its properties or assets that if adversely determined to the Company would or could be expected to have a Material Adverse Effect.

(u) The Company has filed a registration statement pursuant to
Section 12(g) of the Exchange Act to register the Common Stock thereunder, has filed an application to list the Shares on the Nasdaq National Market, and has received notification that the

6

listing has been approved, subject to notice of issuance or sale of the Shares, as the case may be.

(v) The Company is not, and does not intend to conduct its business in a manner in which it would become, an "investment company" as defined in Section 3(a) of the Investment Company Act of 1940, as amended ("INVESTMENT COMPANY ACT").

SECTION 3. REPRESENTATIONS AND WARRANTIES OF THE UNDERWRITERS. The Representatives, on behalf of the several Underwriters, represent and warrant to the Company that the information set forth (a) on the cover page of the Prospectus with respect to price, underwriting discount and terms of the offering and (b) paragraphs 1, 2, 3, 4, 5, 6, 10, 11, 12, 13, 16 and 17 under "Plan of Distribution - Underwritten Public Offering" in the Prospectus was furnished to the Company by and on behalf of the Underwriters for use in connection with the preparation of the Registration Statement and is correct and complete in all material respects.

SECTION 4. PURCHASE, SALE AND DELIVERY OF SHARES. On the basis of the representations, warranties and agreements herein contained, but subject to the terms and conditions herein set forth, the Company agrees to sell to the Underwriters named in Schedule A hereto, and the Underwriters agree, severally and not jointly, to purchase from the Company _________ Firm Shares at the price per share set forth in the Pricing Agreement. The obligation of each Underwriter to the Company shall be to purchase from the Company that number of full shares which (as nearly as practicable, as determined by you) bears to ______________, the same proportion as the number of Shares set forth opposite the name of such Underwriter in Schedule A hereto bears to the total number of Firm Shares to be purchased by all Underwriters under this Agreement. The initial public offering price and the purchase price shall be set forth in the Pricing Agreement.

At 9:00 A.M., Chicago Time, on the fourth business day, if permitted under Rule 15c6-1 under the Exchange Act, (or the third business day if required under Rule 15c6-1 under the Exchange Act or unless postponed in accordance with the provisions of Section 11) following the date the Registration Statement becomes effective (or, if the Company has elected to rely upon Rule 430A, the fourth business day, if permitted under Rule 15c6-1 under the Exchange Act, (or the third business day if required under Rule 15c6-1 under the Exchange Act) after execution of the Pricing Agreement), or such other time not later than ten business days after such date as shall be agreed upon by the Representatives and the Company, the Company will deliver to you at the offices of counsel for the Underwriters or through the facilities of The Depository Trust Company for the accounts of the several Underwriters, certificates representing the Firm Shares to be sold by it against payment of the purchase price therefor in immediately available funds via wire transfer to an account of the Company given to the Underwriters not more than 48 hours prior thereto. Such time of delivery and payment is herein referred to as the "FIRST CLOSING DATE." The certificates for the Firm Shares so to be delivered will be in such denominations and registered in such names as you request by notice to the Company prior to 10:00 A.M., Chicago Time, on the second business day preceding the First Closing Date, and will be made available in New York City at the Company's expense for checking and packaging by the Representatives at 10:00 A.M., New York Time, on the business day preceding the First Closing Date. Payment for the Firm Shares so to be delivered shall be made at the time and in

7

the manner described above to an account designated by the Company prior to the First Closing Date.

In addition, on the basis of the representations, warranties and agreements herein contained, but subject to the terms and conditions herein set forth, the Company hereby grants an option to the several Underwriters to purchase, severally and not jointly, up to an aggregate of _______ Option Shares, at the same purchase price per share to be paid for the Firm Shares, for use solely in covering any over-allotments made by the Underwriters in the sale and distribution of the Firm Shares. The option granted hereunder may be exercised at any time (but not more than once) within 30 days after the date of the initial public offering upon written notice by you to the Company setting forth the aggregate number of Option Shares as to which the Underwriters are exercising the option, the names and denominations in which the certificates for such shares are to be registered and the time and place at which such certificates will be delivered. Such time of delivery (which may not be earlier than the First Closing Date), being herein referred to as the "SECOND CLOSING DATE," shall be determined by you, but if at any time other than the First Closing Date, shall not be earlier than three nor later than 10 full business days after delivery of such notice of exercise. The number of Option Shares to be purchased by each Underwriter shall be determined by multiplying the number of Option Shares to be sold by the Company pursuant to such notice of exercise by a fraction, the numerator of which is the number of Firm Shares to be purchased by such Underwriter as set forth opposite its name in Schedule A and the denominator of which is the total number of Firm Shares (subject to such adjustments to eliminate any fractional share purchases as you in your absolute discretion may make). Certificates for the Option Shares will be made available at the Company's expense for checking and packaging in New York City at 10:00
A.M., New York Time, on the business day preceding the Second Closing Date. The manner of payment for and delivery of the Option Shares shall be the same as for the Firm Shares as specified in the preceding paragraph.

You have advised the Company that each Underwriter has authorized you to accept delivery of its Shares, to make payment and to receipt therefor. You, individually and not as the Representatives of the Underwriters, may make payment for any Shares to be purchased by any Underwriter whose funds shall not have been received by you by the First Closing Date or the Second Closing Date, as the case may be, for the account of such Underwriter, but any such payment shall not relieve such Underwriter from any obligation hereunder.

SECTION 5. COVENANTS OF THE COMPANY AND MCSi. The Company and MCSi covenant and agree that:

(a) The Company will advise you promptly of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or of the institution of any proceedings for that purpose, or of any notification of the suspension of qualification of the Shares for sale in any jurisdiction or the initiation or threatening of any proceedings for that purpose, and will also advise you promptly of any request of the Commission for amendment or supplement of the Registration Statement, of any preliminary prospectus or of the Prospectus, or for additional information.

(b) The Company will give you notice of its intention to file or prepare any amendment to the Registration Statement (including any post-effective amendment) or

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any Rule 462(b) Registration Statement or any amendment or supplement to the Prospectus (including any revised prospectus which the Company proposes for use by the Underwriters in connection with the offering of the Shares which differs from the prospectus on file at the Commission at the time the Registration Statement became or becomes effective, whether or not such revised prospectus is required to be filed pursuant to Rule 424(b) and any term sheet as contemplated by Rule 434) and will furnish you with copies of any such amendment or supplement a reasonable amount of time prior to such proposed filing or use, as the case may be, and will not file any such amendment or supplement or use any such prospectus to which you or counsel for the Underwriters shall reasonably object in writing.

(c) If the Company elects to rely on Rule 434 of the 1933 Act, the Company will prepare a term sheet that complies with the requirements of Rule 434. If the Company elects not to rely on Rule 434, the Company will provide the Underwriters with copies of the form of prospectus, in such numbers as the Underwriters may reasonably request, and file with the Commission such prospectus in accordance with Rule 424(b) of the 1933 Act by the close of business in New York City on the second business day immediately succeeding the date of the Pricing Agreement. If the Company elects to rely on Rule 434, the Company will provide the Underwriters with copies of the form of Rule 434 Prospectus, in such numbers as the Underwriters may reasonably request, by the close of business in New York City on the business day immediately succeeding the date of the Pricing Agreement.

(d) If at any time when a prospectus relating to the Shares is required to be delivered under the 1933 Act any event occurs as a result of which the Prospectus, including any amendments or supplements, would 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, in the light of the circumstances under which they were made, not misleading, or if it is necessary at any time to amend the Prospectus, including any amendments or supplements thereto and including any revised prospectus which the Company proposes for use by the Underwriters in connection with the offering of the Shares which differs from the prospectus on file with the Commission at the time of effectiveness of the Registration Statement, whether or not such revised prospectus is required to be filed pursuant to Rule 424(b) to comply with the 1933 Act, the Company promptly will advise you thereof and will promptly prepare and file with the Commission an amendment or supplement which will correct such statement or omission or an amendment which will effect such compliance; and, in case any Underwriter is required to deliver a prospectus nine months or more after the effective date of the Registration Statement, the Company upon request, but at the expense of such Underwriter, will prepare promptly such prospectus or prospectuses as may be necessary to permit compliance with the requirements of
Section 10(a)(3) of the 1933 Act.

(e) The Company will not, prior to the earlier of the Second Closing Date or termination or expiration of the related option, incur any liability or obligation, direct or contingent, or enter into any material transaction, other than in the ordinary course of business, except as contemplated by the Prospectus.

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(f) The Company will not acquire any capital stock of the Company prior to the earlier of the Second Closing Date or termination or expiration of the related option nor will the Company declare or pay any dividend or make any other distribution upon the Common Stock payable to stockholders of record on a date prior to the earlier of the Second Closing Date or termination or expiration of the related option, except in either case as contemplated by the Prospectus.

(g) Not later than ______________, 2001 the Company will make generally available to its security holders an earnings statement (which need not be audited) covering a period of at least 12 months beginning after the effective date of the Registration Statement, which will satisfy the provisions of the last paragraph of Section 11(a) of the 1933 Act.

(h) During such period as a prospectus is required by law to be delivered in connection with offers and sales of the Shares by an Underwriter or dealer, the Company will furnish to you at its expense, subject to the provisions of subsection (d) hereof, copies of the Registration Statement, the Prospectus, each preliminary prospectus and all amendments and supplements to any such documents in each case as soon as available and in such quantities as you may reasonably request, for the purposes contemplated by the 1933 Act.

(i) The Company will cooperate with the Underwriters in qualifying or registering the Shares for sale under the blue sky laws of such jurisdictions as you designate, and will continue such qualifications in effect so long as reasonably required for the distribution of the Shares. The Company shall not be required to qualify as a foreign corporation or to file a general consent to service of process in any such jurisdiction where it is not currently qualified or where it would be subject to taxation as a foreign corporation.

(j) During the period of five years hereafter, the Company will furnish you and each of the other Underwriters with a copy (i) as soon as practicable after the filing thereof, of each report filed by the Company with the Commission, any securities exchange or the NASD;
(ii) as soon as practicable after the release thereof, of each material press release in respect of the Company; and (iii) as soon as available, of each report of the Company mailed to stockholders.

(k) The Company will use the net proceeds received by it from the sale of the Shares being sold by it in the manner specified in the Prospectus.

(l) If, at the time of effectiveness of the Registration Statement, any information shall have been omitted therefrom in reliance upon Rule 430A and/or Rule 434, then immediately following the execution of the Pricing Agreement, the Company will prepare, and file or transmit for filing with the Commission in accordance with such Rule 430A, Rule 424(b) and/or Rule 434, copies of an amended Prospectus, or, if required by such Rule 430A and/or Rule 434, a post-effective amendment to the Registration Statement (including an amended Prospectus), containing all information so omitted. If required, the Company will prepare and file, or transmit for filing, a Rule

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462(b) Registration Statement not later than the date of the execution of the Pricing Agreement. If a Rule 462(b) Registration Statement is filed, the Company shall make payment of, or arrange for payment of, the additional registration fee owing to the Commission required by Rule 111.

(m) The Company will comply with all registration, filing and reporting requirements of the Exchange Act and the Nasdaq National Market and will file with the Commission all information required by Rule 463.

(n) The Company agrees not to, directly or indirectly, sell, offer, contract to sell, transfer the economic risk of ownership in, make any short sale, pledge or otherwise dispose of any shares of Common Stock or securities convertible into Common Stock (except Common Stock issued pursuant to currently outstanding options, warrants or convertible securities and except for options to be granted under the Amended and Restated 1999 Stock Option Plan in the ordinary course) for a period of 180 days after this Agreement becomes effective without the prior written consent of the Representatives. The Company has obtained similar agreements from each of its officers and directors, any holder of at least 1% of its outstanding equity and MCSi.

SECTION 6. PAYMENT OF EXPENSES. Whether or not the transactions contemplated hereunder are consummated or this Agreement becomes effective as to all of its provisions or is terminated, the Company agrees to pay (i) all costs, fees and expenses (other than legal fees and disbursements of counsel for the Underwriters and the expenses incurred by the Underwriters) incurred in connection with the performance of the Company's obligations hereunder, including without limiting the generality of the foregoing, all fees and expenses of legal counsel for the Company and of the Company's independent accountants, all costs and expenses incurred in connection with the preparation, printing, filing and distribution of the Registration Statement, each preliminary prospectus and the Prospectus (including all exhibits and financial statements) and all amendments and supplements provided for herein, this Agreement, the Pricing Agreement and the Blue Sky Memorandum, (ii) all costs, fees and expenses (including legal fees not to exceed $12,000 and disbursements of counsel for the Underwriters) incurred by the Underwriters in connection with qualifying or registering all or any part of the Shares for offer and sale under blue sky laws and clearance of such offering with the NASD; and (iii) all fees and expenses of the Company's transfer agent, printing of the certificates for the Shares and all transfer taxes, if any, with respect to the sale and delivery of the Shares to the several Underwriters.

The provisions of this Section shall not affect any agreement which the Company may make for the allocation or sharing of such expenses and costs.

SECTION 7. CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITERS. The obligations of the several Underwriters to purchase and pay for the Firm Shares on the First Closing Date and the Option Shares on the Second Closing Date shall be subject to the accuracy of the representations and warranties on the part of the Company and MCSi herein set forth as of the date hereof and as of the First Closing Date or the Second Closing Date, as the case may be, to the accuracy of the statements of officers of the Company made pursuant to the provisions

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hereof, to the performance by the Company of its obligations hereunder, and to the following additional conditions:

(a) The Registration Statement shall have become effective either prior to the execution of this Agreement or not later than 1:00 P.M., Chicago Time, on the first full business day after the date of this Agreement, or such later time as shall have been consented to by you but in no event later than 1:00 P.M., Chicago Time, on the third full business day following the date hereof; and prior to the First Closing Date or the Second Closing Date, as the case may be, no stop order suspending the effectiveness of the Registration Statement shall have been issued and no proceedings for that purpose shall have been instituted or shall be pending or, to the knowledge of the Company or you, shall be contemplated by the Commission. If the Company has elected to rely upon Rule 430A and/or Rule 434, the information concerning the initial public offering price of the Shares and price-related information shall have been transmitted to the Commission for filing pursuant to Rule 424(b) within the prescribed period and the Company will provide evidence satisfactory to the Representatives of such timely filing (or a post-effective amendment providing such information shall have been filed and declared effective in accordance with the requirements of Rules 430A and 424(b)). If a Rule 462(b) Registration Statement is required, such Registration Statement shall have been transmitted to the Commission for filing and become effective within the prescribed time period and, prior to the First Closing Date, the Company shall have provided evidence of such filing and effectiveness in accordance with Rule 462(b).

(b) The Shares shall have been qualified for sale under the blue sky laws of such states as shall have been specified by the Representatives.

(c) The legality and sufficiency of the authorization, issuance and sale or transfer and sale of the Shares hereunder, the validity and form of the certificates representing the Shares, the execution and delivery of this Agreement and the Pricing Agreement, and all corporate proceedings and other legal matters incident thereto, and the form of the Registration Statement and the Prospectus (except financial statements) shall have been approved by counsel for the Underwriters exercising reasonable judgment.

(d) You shall not have advised the Company that the Registration Statement or the Prospectus or any amendment or supplement thereto, contains an untrue statement of fact, which, in the opinion of counsel for the Underwriters, is material or omits to state a fact which, in the opinion of such counsel, is material and is required to be stated therein or necessary to make the statements therein not misleading.

(e) Subsequent to the execution and delivery of this Agreement, there shall not have occurred any change, or any development involving a prospective change, in or affecting particularly the business or properties of the Company, whether or not arising in the ordinary course of business, which, in the judgment of the Representatives, makes it impractical or inadvisable to proceed with the public offering or purchase of the Shares as contemplated hereby.

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(f) The Company shall have received payment in full for the MCSi Shares at the price per share set forth in the Pricing Agreement prior to the purchase of the Firm Shares.

(g) There shall have been furnished to you, as Representatives of the Underwriters, on the First Closing Date or the Second Closing Date, as the case may be, except as otherwise expressly provided below:

(i) An opinion of Elias, Matz, Tiernan & Herrick L.L.P., counsel for the Company, addressed to the Underwriters and dated the First Closing Date or the Second Closing Date, as the case may be, to the effect that:

(1) the Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of the State of Delaware with corporate power and authority to own its properties and conduct its business as described in the Prospectus;

(2) MCSi has been duly incorporated and is validly existing as a corporation in good standing under the laws of the State of Maryland;

(3) the authorized capital stock of the Company, of which there is outstanding the amount set forth in the Registration Statement and Prospectus (except for subsequent issuances, if any, pursuant to stock options or other rights referred to in the Prospectus), conforms as to legal matters in all material respects to the description thereof in the Registration Statement and Prospectus;

(4) the issued and outstanding capital stock of the Company has been duly authorized and validly issued and is fully paid and nonassessable;

(5) the certificates for the Shares to be delivered hereunder are in due and proper form, and when duly countersigned by the Company's transfer agent and delivered to you or upon your order against payment of the agreed consideration therefor in accordance with the provisions of this Agreement and the Pricing Agreement, the Shares represented thereby will be duly authorized and validly issued, fully paid and nonassessable;

(6) To the best knowledge of such counsel, the Registration Statement has become effective under the 1933 Act, and no stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose have been instituted or are pending or contemplated under the 1933 Act, and the Registration Statement (including the information deemed to be part of the Registration Statement at the time of effectiveness pursuant to Rule 430A(b) and/or Rule 434, if applicable), the Prospectus and each amendment or supplement thereto (except for the financial statements and other statistical or financial data and schedules and information provided by the Underwriters as described

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in Section 3 included therein as to which such counsel need express no opinion) comply as to form in all material respects with the requirements of the 1933 Act; the statements in the Registration Statement and the Prospectus summarizing statutes, rules and regulations are accurate and fairly and correctly present the information required to be presented by the 1933 Act or the rules and regulations thereunder relating to such statutes, rules and regulations, in all material respects and such counsel does not know of any statutes, rules and regulations required to be described or referred to in the Registration Statement or the Prospectus that are not described or referred to therein as required; and such counsel does not know of any legal or governmental proceedings pending or threatened required to be described in the Prospectus which are not described as required, nor of any contracts or documents of a character required to be described in the Registration Statement or Prospectus or to be filed as exhibits to the Registration Statement which are not described or filed, as required;

(7) the statements under the captions "Management - 1999 Stock Option Plan, - Employee Stock Purchase Plan" "Certain Transactions," "Description of Capital Stock" and "Shares Eligible for Future Sale" in the Prospectus, insofar as such statements constitute a summary of documents referred to therein or matters of law, are accurate summaries and fairly and correctly present, in all material respects, the information called for with respect to such documents and matters;

(8) this Agreement and the Pricing Agreement and the performance of the obligations of the Company and MCSi hereunder and thereunder have been duly authorized by all necessary corporate action and this Agreement and the Pricing Agreement have been duly executed and delivered by and on behalf of the Company and MCSi, and are legal, valid and binding agreements of the Company and MCSi, except as enforceability of the same may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditors' rights and by the exercise of judicial discretion in accordance with general principles applicable to equitable and similar remedies and except as to those provisions relating to indemnities for liabilities arising under the 1933 Act as to which no opinion need be expressed; and no approval, authorization or consent of any public board, agency, or instrumentality of the United States or of any state or other jurisdiction is necessary in connection with the issue or sale of the Shares by the Company pursuant to this Agreement (other than under the 1933 Act, applicable blue sky laws and the rules of the NASD) or the consummation by the Company or MCSi of any other transactions described herein;

(9) the execution and performance of this Agreement and the issuance of the Shares and the MCSi Shares by the Company will not contravene any of the provisions of, or result in a default under, any

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agreement, franchise, license, indenture, mortgage, deed of trust, or other instrument known to such counsel and set forth as an Exhibit to the Registration Statement, of the Company or MCSi or by which the property of any of them is bound and which contravention or default would be material to either the Company or MCSi; or violate any of the provisions of the charter or bylaws of the Company or MCSi or, so far as is known to such counsel, violate any statute, order, rule or regulation of any regulatory or governmental body having jurisdiction over the Company or MCSi except such breaches or defaults which would not have a Material Adverse Effect on the Company taken as a whole;

(10) to such counsel's knowledge, all offers and sales of the Company's capital stock since the Company's inception to the effective date of the Registration Statement were at all relevant times exempt from the registration requirements of the 1933 Act and were duly registered or the subject of an available exemption from the registration requirements of the applicable state securities or blue sky laws;

In rendering such opinion, such counsel may rely and state that they are relying upon the certificate of the transfer agent for the Common Stock as to the number of shares of Common Stock at any time or times outstanding, and that insofar as their opinion under clause
(7) above relates to the accuracy and completeness of the Prospectus and Registration Statement, it is based upon a general review with the Company's representatives and independent accountants of the information contained therein, without independent verification by such counsel of the accuracy or completeness of such information. Such counsel may also rely upon the opinions of other competent counsel and, as to factual matters, on certificates of officers of the Company and of governmental officials, in which case their opinion is to state that they are so doing and copies of said opinions or certificates are to be attached to the opinion unless said opinions or certificates (or, in the case of certificates, the information therein) have been furnished to the Representatives in other form.

Such counsel's opinion shall be limited to matters governed by federal securities laws and by the General Corporation Law of the States of Delaware (as to the Company) and Maryland (as to MCSi). The opinion shall be interpreted according to the Legal Opinion Accord of the Section of Business Law of The American Bar Association (1991) (the "ACCORD"). For purposes of such opinions, no proceedings shall be deemed to be pending, no order or stop order shall be deemed to be issued, and no action shall be deemed to be instituted unless, in each case, a director or executive officer of the Company shall have received a copy of such proceedings, order, stop order or action. For purposes of such opinion, no proceedings shall be deemed to be threatened unless the potential litigant or government authority has manifested in writing to the directors or management of the Company, or to counsel thereof, a present intention to initiate such litigation or proceedings. In addition, such opinion may be limited to present statutes, regulations and judicial interpretations and to facts as they presently exist as of

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the date of such opinion, In rendering such opinion, such counsel need assume no obligation to revise or supplement it should the present laws be changed by legislative or regulatory action, judicial action or otherwise. Such counsel may make certain customary assumptions relating to parties other than the Company or MCSi.

In addition, such counsel shall confirm in a separate letter that in connection with the preparation of the Registration Statement, they have participated in conferences with officers, employees and other representatives of the Company and MCSi, independent accountants of the Company, the Underwriters and counsel for the Underwriters, at which the contents of the Registration Statement and Prospectus were discussed and, although such counsel is not passing upon and does not assume responsibility for the accuracy, completeness or fairness of the statements contained in the Registration Statement or Prospectus, and has not made any independent check or verification thereof, on the basis of the foregoing (relying as to materiality to a large extent upon the statements of officers, employees and other representatives of the Company), such counsel have no reason to believe that either the Registration Statement (including the information deemed to be part of the Registration Statement at the time of effectiveness pursuant to Rule 430A(b) and/or Rule 434, if applicable) or the Prospectus, or the Registration Statement or the Prospectus as amended or supplemented (except as aforesaid), as of their respective effective dates, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading or that the Prospectus as amended or supplemented, if applicable, as of the First Closing Date or the Second Closing Date, as the case may be, contained any untrue statement of a material fact or omitted to state any material fact necessary to make the statements therein not misleading in light of the circumstances under which they were made (it being understood that, in each case, such counsel need express no view with respect to the financial statements and other financial and statistical data and schedules included in the Registration Statement or Prospectus or the information from the Underwriters in the Prospectus as described in Section 3).

(ii) Such opinion or opinions of Sidley & Austin, counsel for the Underwriters, dated the First Closing Date or the Second Closing Date, as the case may be, with respect to the incorporation of the Company, the validity of the Shares to be sold by the Company, the Registration Statement and the Prospectus and other related matters as you may reasonably require, and the Company shall have furnished to such counsel such documents and shall have exhibited to them such papers and records as they request for the purpose of enabling them to pass upon such matters.

(iii) A certificate of the chief executive officer and the principal financial officer of the Company, dated the First Closing Date or the Second Closing Date, as the case may be, to the effect that:

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(1) the representations and warranties relating to the Company set forth in Section 2 of this Agreement are true and correct as of the date of this Agreement and as of the First Closing Date or the Second Closing Date, as the case may be, and the Company has complied with all the agreements and satisfied all the conditions on its part to be performed or satisfied at or prior to such Closing Date; and

(2) the Commission has not issued an order preventing or suspending the use of the Prospectus or any preliminary prospectus filed as a part of the Registration Statement or any amendment thereto; no stop order suspending the effectiveness of the Registration Statement has been issued; and to the best knowledge of the respective signers, no proceedings for that purpose have been instituted or are pending or contemplated under the 1933 Act.

The delivery of the certificate provided for in this subparagraph shall be and constitute a representation and warranty of the Company as to the facts required in the immediately foregoing clauses (1) and (2) of this subparagraph to be set forth in said certificate.

(iv) At the time the Pricing Agreement is executed and also on the First Closing Date or the Second Closing Date, as the case may be, there shall be delivered to you a letter addressed to you, as Representatives of the Underwriters, from PricewaterhouseCoopers LLP, independent accountants, the first one to be dated the date of the Pricing Agreement, the second one to be dated the First Closing Date and the third one (in the event of a second closing) to be dated the Second Closing Date, in such form reasonably satisfactory to Sidley & Austin, counsel for the Underwriters. There shall not have been any change specified in the letters referred to in this subparagraph which makes it impractical or inadvisable in the judgment of the Representatives to proceed with the public offering or purchase of the Shares as contemplated hereby.

(v) Such further certificates and documents as you may reasonably request.

All such opinions, certificates, letters and documents shall be in compliance with the provisions hereof only if they are satisfactory to you and to Sidley & Austin, counsel for the Underwriters, which approval shall not be unreasonably withheld. The Company shall furnish you with such manually signed or conformed copies of such opinions, certificates, letters and documents as you request.

If any condition to the Underwriters' obligations hereunder to be satisfied prior to or at the First Closing Date is not so satisfied, this Agreement at your election will terminate upon notification to the Company without liability on the part of any Underwriter or the Company or MSCi, except for the expenses to be paid or reimbursed by the Company pursuant to Sections 6 and 9 hereof and except to the extent provided in Section 10 hereof.

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SECTION 8. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If the sale to the Underwriters of the Shares on the First Closing Date is not consummated because any condition of the Underwriters' obligations hereunder is not satisfied or because of any refusal, inability or failure on the part of the Company to perform any agreement herein or to comply with any provision hereof, unless such failure to satisfy such condition or to comply with any provision hereof is due to the default or omission of any Underwriter, the Company agrees to reimburse you and the other Underwriters upon demand for all out-of-pocket expenses (including reasonable fees and disbursements of counsel) that shall have been reasonably incurred by you and them in connection with the proposed purchase and the sale of the Shares. Any such termination shall be without liability of any party to any other party except that the provisions of this Section, Section 6 and Section 10 shall at all times be effective and shall apply.

SECTION 9. EFFECTIVENESS OF REGISTRATION STATEMENT. You, the Company and MCSi will use your, its and their respective its best efforts to cause the Registration Statement to become effective, if it has not yet become effective, and to prevent the issuance of any stop order suspending the effectiveness of the Registration Statement and, if such stop order be issued, to obtain as soon as possible the lifting thereof.

SECTION 10. INDEMNIFICATION.

(a) The Company and MSCi, jointly and severally, agree to indemnify and hold harmless each Underwriter and each person, if any, who controls any Underwriter within the meaning of the 1933 Act or the Exchange Act against any losses, claims, damages or liabilities, joint or several, to which such Underwriter or such controlling person may become subject under the 1933 Act, the Exchange Act or other federal or state statutory law or regulation, at common law or otherwise (including in settlement of any litigation if such settlement is effected with the written consent of the Company and/or MSCi, as the case may be), 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 the Registration Statement, including the information deemed to be part of the Registration Statement at the time of effectiveness pursuant to Rule 430A and/or Rule 434, if applicable, any preliminary prospectus, the Prospectus, any amendment or supplement thereto, or any written material prepared by or with the consent of the Company or MCSi for distribution in connection with the MCSi Subscription Program, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated in any of the aforementioned documents or necessary to make the statements therein not misleading, or related to, arising out of, or in connection with the MCSi Subscription Program; and will reimburse each Underwriter and each such controlling person for any legal or other expenses reasonably incurred by such Underwriter or such controlling person in connection with investigating or defending any such loss, claim, damage, liability or action; provided, however, that neither the Company nor MSCi will be liable in any such case to the extent that (i) any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission made in the Registration Statement, any preliminary prospectus, the Prospectus or any amendment or supplement thereto in reliance upon and in conformity with the written information with respect to which the Underwriters have made representations

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and warranties in Section 3 hereof; or (ii) if such statement or omission was contained or made in any preliminary prospectus and corrected in the Prospectus and (1) any such loss, claim, damage or liability suffered or incurred by any Underwriter (or any person who controls any Underwriter) resulted from an action, claim or suit by any person who purchased Shares which are the subject thereof from such Underwriter in the offering and (2) such Underwriter failed to deliver or provide a copy of the Prospectus to such person at or prior to the confirmation of the sale of such Shares in any case where such delivery is required by the 1933 Act. In addition to their other obligations under this Section 10(a), the Company and MCSi agree that, as an interim measure during the pendency of any claim, action, investigation, inquiry or other proceeding arising out of or based upon any statement or omission, or any alleged statement or omission, described in this Section 10(a), they will reimburse the Underwriters on a monthly basis for all reasonable and documented legal and other expenses incurred in connection with investigating or defending any such claim, action, investigation, inquiry or other proceeding, notwithstanding the absence of a judicial determination as to the propriety and enforceability of the Company's and MCSi's obligation to reimburse the Underwriters for such expenses and the possibility that such payments might later be held to have been improper by a court of competent jurisdiction. This indemnity agreement will be in addition to any liability which the Company and MCSi may otherwise have.

(b) Each Underwriter will severally indemnify and hold harmless the Company, each of its directors, each of its officers who signed the Registration Statement, and each person (including without limitation MCSi and its controlling persons, directors and officers) who controls the Company within the meaning of the 1933 Act or the Exchange Act (a "CONTROLLING PERSON"), against any losses, claims, damages or liabilities to which the Company, or any such director, officer, or Controlling Person may become subject under the 1933 Act, the Exchange Act or other federal or state statutory law or regulation, at common law or otherwise (including in settlement of any litigation, if such settlement is effected with the written consent of such Underwriter), insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue or alleged untrue statement of any material fact contained in the Registration Statement, any preliminary prospectus, the Prospectus, 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, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in the Registration Statement, any preliminary prospectus, the Prospectus, or any amendment or supplement thereto in reliance upon and in conformity with the written information with respect to which the Underwriters have made representations and warranties in Section 3 hereof; and will reimburse any legal or other expenses reasonably incurred by the Company, or any such director, officer, or Controlling Person in connection with investigating or defending any such loss, claim, damage, liability or action. In addition to their other obligations under this Section
10(b), the Underwriters agree that, as an interim measure during the pendency of any claim, action, investigation, inquiry or other proceeding arising out of or based upon any statement or omission, or any alleged statement or omission, described in this Section 10(b), they will reimburse the Company on a monthly basis for all reasonable and

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documented legal and other expenses incurred in connection with investigating or defending any such claim, action, investigation, inquiry or other proceeding, notwithstanding the absence of a judicial determination as to the propriety and enforceability of the Underwriters' obligation to reimburse the Company for such expenses and the possibility that such payments might later be held to have been improper by a court of competent jurisdiction. This indemnity agreement will be in addition to any liability which such Underwriter may otherwise have.

(c) Promptly after receipt by an indemnified party under this
Section 10 of notice of the commencement of any action, such indemnified party will, if a claim in respect thereof is to be made against an indemnifying party under this Section 10, notify the indemnifying party of the commencement thereof; but the omission so to notify the indemnifying party will not relieve it from any liability which it may have to any indemnified party except to the extent that the indemnifying party was prejudiced by such failure to notify. In case any such action is brought against any indemnified party, and it notifies an indemnifying party of the commencement thereof, the indemnifying party will be entitled to participate in, and, to the extent that it may wish, jointly with all other indemnifying parties similarly notified, to assume the defense thereof, with counsel reasonably satisfactory to such indemnified party; PROVIDED, HOWEVER, if the defendants in any such action include both the indemnified party and the indemnifying party and counsel for the indemnified party shall have reasonably advised that there may be legal defenses available to the indemnified party and/or other indemnified parties which are different from or additional to those available to the indemnifying party, or the indemnified and indemnifying parties may have conflicting interests which would make it inappropriate for the same counsel to represent both of them, the indemnified party or parties shall have the right to select separate counsel to assume such legal defense and otherwise to participate in the defense of such action on behalf of such indemnified party or parties. Upon receipt of notice from the indemnifying party to such indemnified party of its election so to assume the defense of such action and approval by the indemnified party of counsel, the indemnifying party will not be liable to such indemnified party under this Section 10 for any legal or other expenses subsequently incurred by such indemnified party in connection with the defense thereof unless (i) the indemnified party shall have employed such counsel in connection with the assumption of legal defense in accordance with the proviso to the immediately preceding sentence (it being understood, however, that the indemnifying party shall not be liable for the expenses of more than one separate counsel, approved by the Representatives in the case of paragraph (a) representing all indemnified parties not having different or additional defenses or potential conflicting interest among themselves who are parties to such action), (ii) the indemnifying party shall not have employed counsel reasonably satisfactory to the indemnified party to represent the indemnified party within a reasonable time after notice of commencement of the action or (iii) the indemnifying party has authorized the employment of counsel for the indemnified party at the expense of the indemnifying party. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened proceeding in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party, unless such settlement includes an

20

unconditional release of such indemnified party from all liability arising out of such proceeding.

(d) If the indemnification provided for in this Section 10 is unavailable to an indemnified party under paragraphs (a) or (b) hereof in respect of any losses, claims, damages or liabilities referred to therein, then each applicable indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the Company, MSCi and the Underwriters from the offering of the Shares or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company, MCSi and the Underwriters in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations. The respective relative benefits received by the Company, MSCi and the Underwriters shall be deemed to be in the same proportion in the case of the Company and MCSi as the total price paid to the Company for the Shares by the Underwriters (net of underwriting discount but before deducting expenses), and in the case of the Underwriters as the underwriting discount received by them bears to the total of such amounts paid to the Company and received by the Underwriters as underwriting discount, in each case as contemplated by the Prospectus. The relative fault of the Company and MSCi and the Underwriters shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission to state a material fact relates to information supplied by the Company or by MSCi or by the Underwriters and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The amount paid or payable by a party as a result of the losses, claims, damages and liabilities referred to above shall be deemed to include any legal or other fees or expenses reasonably incurred by such party in connection with investigating or defending any action or claim.

The Company, MSCi and the Underwriters each agree that it would not be just and equitable if contribution pursuant to this
Section 10 were determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to in the immediately preceding paragraph. Notwithstanding the provisions of this Section 10, no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the Shares underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages which such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Underwriters' obligations to contribute pursuant to this Section are several in proportion to their respective underwriting commitments and not joint.

21

(e) The provisions of this Section shall survive any termination of this Agreement.

SECTION 11. DEFAULT OF UNDERWRITERS. It shall be a condition to the agreement and obligation of the Company to sell and deliver the Shares hereunder, and of each Underwriter to purchase the Shares hereunder, that, except as hereinafter in this paragraph provided, each of the Underwriters shall purchase and pay for all Shares agreed to be purchased by such Underwriter hereunder upon tender to the Representatives of all such Shares in accordance with the terms hereof. If any Underwriter or Underwriters default in their obligations to purchase Shares hereunder on the First Closing Date and the aggregate number of Shares which such defaulting Underwriter or Underwriters agreed but failed to purchase does not exceed 10 percent of the total number of Shares which the Underwriters are obligated to purchase on the First Closing Date, the Representatives may make arrangements satisfactory to the Company for the purchase of such Shares by other persons, including any of the Underwriters, but if no such arrangements are made by such date, the non-defaulting Underwriters shall be obligated severally, in proportion to their respective commitments hereunder, to purchase the Shares which such defaulting Underwriters agreed but failed to purchase on such date. If any Underwriter or Underwriters so default and the aggregate number of Shares with respect to which such default or defaults occur is more than the above percentage and arrangements satisfactory to the Representatives and the Company for the purchase of such Shares by other persons are not made within 36 hours after such default, this Agreement will terminate without liability on the part of any non-defaulting Underwriter or the Company except for the expenses to be paid by the Company pursuant to Section 6 hereof (other than SECTION 6(ii)) and except to the extent provided in Section 10 hereof.

In the event that Shares to which a default relates are to be purchased by the non-defaulting Underwriters or by another party or parties, the Representatives or the Company shall have the right to postpone the First Closing Date for not more than seven business days in order that the necessary changes in the Registration Statement, Prospectus and any other documents, as well as any other arrangements, may be effected. As used in this Agreement, the term "Underwriter" includes any person substituted for an Underwriter under this Section. Nothing herein will relieve a defaulting Underwriter from liability for its default.

SECTION 12. EFFECTIVE DATE. This Agreement shall become effective immediately as to Sections 6, 8, 10, 13 and 19 and as to all other provisions at 10:00 A.M., Chicago Time, on the day following the date upon which the Pricing Agreement is executed and delivered, unless such a day is a Saturday, Sunday or holiday (and in that event this Agreement shall become effective at such hour on the business day next succeeding such Saturday, Sunday or holiday); but this Agreement shall nevertheless become effective at such earlier time after the Pricing Agreement is executed and delivered as you may determine on and by notice to the Company or by release of any Shares for sale to the public. For the purposes of this Section, the Shares shall be deemed to have been so released upon the release for publication of any newspaper advertisement relating to the Shares or upon the release by you of telegrams (i) advising Underwriters that the Shares are released for public offering, or (ii) offering the Shares for sale to securities dealers, whichever may occur first.

22

SECTION 13. TERMINATION. Without limiting the right to terminate this Agreement pursuant to any other provision hereof:

(a) This Agreement may be terminated by the Company by notice to you or by you by notice to the Company at any time prior to the time this Agreement shall become effective as to all its provisions, and any such termination shall be without liability on the part of the Company or MSCi to any Underwriter (except for the expenses to be paid or reimbursed pursuant to Section 6 hereof and except to the extent provided in Section 10 hereof) or of any Underwriter to the Company (except to the extent provided in Section 10 hereof).

(b) This Agreement may also be terminated by you prior to the First Closing Date, and the option referred to in the third paragraph of Section 4 if exercised, may be cancelled at any time prior to the Second Closing Date, if (i) trading in securities on the New York Stock Exchange or Nasdaq National Market shall have been suspended or minimum prices shall have been established on such exchange or market, or (ii) a banking moratorium shall have been declared by Illinois, New York, or United States banking authorities, or (iii) there shall have been any adverse change in financial markets or in political, economic or financial conditions which, in the opinion of the Representatives, either renders it impracticable or inadvisable to proceed with the offering and sale of the Shares on the terms set forth in the Prospectus or materially and adversely affects the market for the Shares, or (iv) there shall have been an outbreak of major armed hostilities between the United States and any foreign power which in the opinion of the Representatives makes it impractical or inadvisable to offer or sell the Shares. Any termination pursuant to this paragraph
(b) shall be without liability on the part of any Underwriter to the Company or MSCi (except to the extent provided in Section 10 hereof) or on the part of the Company or MSCi to any Underwriter (except for expenses to be paid or reimbursed pursuant to Section 6 hereof and except to the extent provided in Section 10 hereof).

SECTION 14. REPRESENTATIONS AND INDEMNITIES TO SURVIVE DELIVERY. The respective indemnities, agreements, representations, warranties and other statements of the Company, of its officers, of MSCi and of the several Underwriters set forth in or made pursuant to this Agreement will remain in full force and effect, regardless of any investigation made by or on behalf of any Underwriter or the Company or any of its or their partners, principals, members, officers or directors or any controlling person, as the case may be, and will survive delivery of and payment for the Shares sold hereunder.

SECTION 15. NOTICES. All communications hereunder will be in writing and, if sent to the Underwriters will be mailed, delivered or telegraphed and confirmed to you c/o William Blair & Company, L.L.C., 222 West Adams Street, Chicago, Illinois 60606, with a copy to Larry A. Barden c/o Sidley & Austin, Bank One Plaza, Chicago, IL 60603; if sent to the Company will be mailed, delivered or telegraphed and confirmed to the Company at its corporate headquarters with a copy to Jeffrey A. Koeppel c/o Elias, Matz, Tiernan & Herrick L.L.P., 734 15th Street, N.W. Washington, D.C. 20005; and if sent to MSCi will be mailed, delivered or telegraphed and confirmed to MCSi at its corporate headquarters with a copy to Jeffrey A.

23

Koeppel c/o Elias, Matz, Tiernan & Herrick L.L.P. 734 15th Street, N.W. Washington, D.C. 20005.

SECTION 16. SUCCESSORS. This Agreement and the Pricing Agreement will inure to the benefit of and be binding upon the parties hereto and their respective successors, personal representatives and assigns, and to the benefit of the officers and directors and controlling persons referred to in Section 10, and no other person will have any right or obligation hereunder. The term "successors" shall not include any purchaser of the Shares as such from any of the Underwriters merely by reason of such purchase.

SECTION 17. REPRESENTATION OF UNDERWRITERS. You will act as Representatives for the several Underwriters in connection with this financing, and any action under or in respect of this Agreement taken by you will be binding upon all the Underwriters.

SECTION 18. PARTIAL UNENFORCEABILITY. If any section, paragraph or provision of this Agreement is for any reason determined to be invalid or unenforceable, such determination shall not affect the validity or enforceability of any other section, paragraph or provision hereof.

24

SECTION 19. APPLICABLE LAW. This Agreement and the Pricing Agreement shall be governed by and construed in accordance with the laws of the State of Illinois.

If the foregoing is in accordance with your understanding of our agreement, kindly sign and return to us the enclosed duplicates hereof, whereupon it will become a binding agreement among the Company, MCSi and the several Underwriters including you, all in accordance with its terms.

Very truly yours,

ZENGINE, INC.

By
Chief Executive Officer

MSCi, Inc.

By
Chief Executive Officer

The foregoing Agreement is hereby confirmed and accepted as of the date first above
written.

William Blair & Company, L.L.C.
Friedman, Billings, Ramsey & Co., Inc.
E*OFFERING Corp.
Morgan Keegan & Company, Inc.
Acting as Representatives of the
several Underwriters named in
Schedule A.

By William Blair & Company, L.L.C.

By

Principal

25

SCHEDULE A

                                                                                       Number of
                                                                                       Firm Shares
Underwriter                                                                         to be Purchased
-----------                                                                         ---------------

William Blair & Company, L.L.C.
Friedman, Billings, Ramsey & Co., Inc.
E*OFFERING Corp.
Morgan Keegan & Company, Inc.





         TOTAL
                                                                                    ===============

26

EXHIBIT A

ZENGINE, INC.

_______ Shares Common Stock(2)

PRICING AGREEMENT

_______________, 2000

William Blair & Company, L.L.C.
Friedman, Billings, Ramsey & Co., Inc.
E*OFFERING Corp.
Morgan Keegan & Company, Inc.
As Representatives of the Several
Underwriters
c/o William Blair & Company, L.L.C.
222 West Adams Street
Chicago, Illinois 60606

Ladies and Gentlemen:

Reference is made to the Underwriting Agreement dated _________________, 2000 (the "UNDERWRITING AGREEMENT") relating to the sale by the Company and the purchase by the several Underwriters for whom William Blair & Company, L.L.C., Friedman, Billings, Ramsey & Co., Inc., E*OFFERING Corp. and Morgan Keegan & Company, Inc. are acting as representatives (the "REPRESENTATIVES"), of the above Shares. All terms herein shall have the definitions contained in the Underwriting Agreement except as otherwise defined herein.

Pursuant to Section 4 of the Underwriting Agreement, the Company agrees with the Representatives as follows:

1. The initial public offering price per share for the Shares shall be $__________.

2. The purchase price per share for the Shares to be paid by the several Underwriters shall be $_____________, being an amount equal to the initial public offering price set forth above less $____________ per share.

Schedule A is amended as follows:


(2) Plus an option to acquire up to ___ additional shares to cover overallotments

27

If the foregoing is in accordance with your understanding of our agreement, kindly sign and return to us the enclosed duplicates hereof, whereupon it will become a binding agreement among the Company and the several Underwriters, including you, all in accordance with its terms.

Very truly yours,

ZENGINE, INC.

By
Chief Executive Officer

The foregoing Agreement is hereby confirmed and accepted as of the date first above
written.

William Blair & Company, L.L.C.
Friedman, Billings, Ramsey & Co., Inc.
E*OFFERING Corp.
Morgan Keegan & Company, Inc.
Acting as Representatives of the
several Underwriters

By William Blair & Company, L.L.C.

By

Principal

28

Exhibit 1.3

_________________, 2000

William Blair & Company, L.L.C.
Friedman, Billings, Ramsey & Co., Inc.
E*OFFERING Corp.
Morgan Keegan & Company, Inc.
As Representatives of the Several Underwriters c/o William Blair & Company, L.L.C.
222 West Adams Street
Chicago, Illinois 60606

Ladies and Gentlemen:

The undersigned is a security holder of Zengine, Inc., a Delaware corporation (the "Company"), and wishes to facilitate the public offering (the "Offering") of Common Stock of the Company ("Common Stock") pursuant to a Registration Statement on Form S-1 (the "Registration Statement") to be transmitted for filing with the Securities and Exchange Commission on or about ____________, 2000

In consideration of the foregoing, and in order to induce you to act as underwriters in the Offering, the undersigned hereby irrevocably agrees that it will not, directly or indirectly, sell, offer, contract to sell, transfer the economic risk of ownership in, make any short sale, pledge or otherwise dispose of any shares of Common Stock or securities convertible into Common Stock without the prior written consent of William Blair & Company, L.L.C. acting alone or of each of the Representatives of the Underwriters acting jointly, for a period of 180 days from the effective date of the Registration Statement.

Notwithstanding the foregoing, if the undersigned is an individual, he or she may transfer any shares of Common Stock or securities convertible into or exchangeable or exercisable for the Company's Common Stock either during his or her lifetime or on death by will or intestacy to his or her immediate family or to a trust the beneficiaries of which are exclusively the undersigned and/or a member or members of his or her immediate family; provided, however, that prior to any such transfer each transferee shall execute an agreement, satisfactory to William Blair & Company L.L.C. pursuant to which each transferee shall agree to receive and hold such shares of Common Stock, or securities convertible into or exchangeable or exercisable for the Common Stock, subject to the provisions hereof, and there shall be no further transfer except in accordance with the provisions hereof. For the purposes of this paragraph, "immediate family" shall mean spouse, lineal descendant, father, mother, brother or sister of the transferor.


The undersigned hereby waives any rights of the undersigned to sell shares of Common Stock or any other security issued by the Company pursuant to the Registration Statement, and acknowledges and agrees that for a period of 180 days from the effective date of the Registration Statement the undersigned has no right to require the Company to register under the Securities Act of 1933 such Common Stock or other securities issued by the Company and beneficially owned by the undersigned.

The undersigned understands that the agreements of the undersigned are irrevocable and shall be binding upon the undersigned's heirs, legal representatives, successors and assigns. The undersigned agrees and consents to the entry of stop transfer instructions with the Company's transfer agent against the transfer of Common Stock or other securities of the Company held by the undersigned except in compliance with this agreement.

                                           Very truly yours,

Dated: _________________________           ____________________________
                                           Signature


                                           ____________________________
                                           Printed Name and Title


EXHIBIT 5.1

Law Offices
ELIAS, MATZ, TIERNAN & HERRICK L.L.P.
12th Floor
734 15th Street, N.W.
Washington, D.C. 20005
Telephone (202) 347-0300

August 21, 2000

Via EDGAR

Board of Directors
Zengine, Inc.
6100 Stewart Avenue
Freemont, California 94538

Re: Zengine, Inc.
Registration Statement on Form S-1 Commission File No. 333-36312

Ladies and Gentlemen:

We have acted as special counsel to Zengine, Inc. (the "Company") in connection with the preparation and filing with the Securities and Exchange Commission of a Registration Statement on Form S-1 (No. 333-36312)(the "Registration Statement") relating to the registration under the Securities Act of 1933, as amended (the "Act"), of up to 4,875,000 of shares of common stock, no par value ("Common Stock"), of the Company to be issued and sold in an underwritten public offering (including shares of Common Stock which the underwriters have the option to purchase to cover any over-allotments) and in the MCSi Subscription Program (the "Offering").

In so acting, we have examined originals or copies, certified or otherwise identified to our satisfaction, of the Registration Statement and such corporate records, agreements, documents and other instruments, including the form of the underwriting agreement to be entered into among the Company and the underwriters (the "Underwriting Agreement") and such certificates or comparable documents of public officials, of officers and representatives of the Company as we have deemed relevant or necessary as a basis for the opinions hereinafter set forth.


Board of Directors
August 21, 2000

Page 2

In such examination, we have assumed without independent verification the genuineness of all signatures, the authenticity of all documents submitted to us as originals, the conformity to original documents of documents submitted to us as certified or photostatic copies and the authenticity of the originals of such latter documents. As to all questions of fact material to this opinion that have not been independently established, we have relied upon certificates or comparable documents of officers of the Company, and we have examined the representations and warranties of the Company contained in the Underwriting Agreement and have relied upon the accuracy and completeness of the relevant facts stated therein without independent verification.

Based on the foregoing, and subject to the qualifications stated herein, we are of the opinion that the shares of Common Stock to be issued in the Offering have been duly authorized and, when issued and sold pursuant to the provisions of the Underwriting Agreement, the MCSi Subscription Program and the Prospectus and upon receipt of the consideration required thereby, will be validly issued and fully paid and non-assessable shares of Common Stock of the Company.

We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the references to us under the heading "Legal Matters" in the Prospectus. In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Act.

ELIAS, MATZ, TIERNAN & HERRICK L.L.P.

By:  /s/ KENNETH B. TABACH
     ----------------------------
     Kenneth B. Tabach, a Partner


Exhibit 10.4.1

MCSi, INC.
4750 HEMPSTEAD STATION DRIVE
DAYTON, OHIO 45429

June 1, 2000

Joseph M. Savarino
President
Zengine, Inc.
6100 Stewart Avenue
Fremont, CA 95438

Re: Distribution Services Agreement

Dear Joe:

Pursuant to Section 14(k) of the Distribution Services Agreement by and between Miami Computer Supply Corporation (the corporate predecessor to MCSi, Inc.) ("MCSi") and Zengine, Inc. ("Zengine"), dated as of October 1, 1999 (the "Agreement"), the parties to the Agreement hereby agree to amend the Section 2 of the Agreement by adding a subsection (c), as follows:

"(c) On or before June 30, 2000, Zengine shall pay to MCSi a 'set up' fee in order to prepare space for Zengine at MCSi's new warehouse facility in Erlanger, Kentucky in the amount of 30% of MCSi's April through June 2000 Erlanger warehouse expenses less that portion of expenses attributable to the FedEx project."

Except as set forth above, the Agreement shall remain in full force and effect pursuant to the terms and conditions thereof.

Please signify your agreement to this amendment to the Agreement by signing a copy of this letter in the space provided below and returning the copy to me as soon as possible.

Feel free to call me if you have any questions regarding this matter.

Sincerely,

/s/ Michael E. Peppel
-----------------------
Michael E. Peppel
President and
Chief Executive Officer


Mr. Joseph Savarino
June 1, 2000

Page 2

Agreed and accepted on June 1, 2000:

ZENGINE, INC.

By:   /s/ Joseph M. Savarino
      -----------------------
         Joseph M. Savarino
         President


Exhibit 10.4.2

MCSi, INC.
4750 HEMPSTEAD STATION DRIVE
DAYTON, OHIO 45429

August 17, 2000

Joseph M. Savarino
President
Zengine, Inc.
6100 Stewart Avenue
Fremont, CA 95438

Re: Distribution Services Agreement

Dear Joe:

Pursuant to Section 14(k) of the Distribution Services Agreement by and between Miami Computer Supply Corporation (the corporate predecessor to MCSi, Inc.) ("MCSi") and Zengine, Inc. ("Zengine"), dated as of October 1, 1999 (the "Agreement") as amended on June 1, 2000, the parties to the Agreement hereby agree to amend the Section 2 of the Agreement by deleting subsection (c) in its entirety and replacing it with the following:

"(c) On or before the end of each fiscal quarter through the term of the Distribution Services Agreement, Zengine shall pay to MCSi a fee for its use of MCSi's warehouse facility in Erlanger, Kentucky ("Warehouse") in the amount of the excess of 30% of the total gross expenses of the Warehouse less the cost of the Warehouse dedicated to the FedEx Project and less the amount paid by Zengine to MCSi for the respective quarter under other provisions of the Distribution Services Agreement."

Except as set forth above, the Agreement shall remain in full force and effect pursuant to the terms and conditions thereof.

Please signify your agreement to this amendment to the Agreement by signing a copy of this letter in the space provided below and returning the copy to me as soon as possible.

Feel free to call me if you have any questions regarding this matter.

Sincerely,

/s/ Ira H. Stanley
-------------------
Ira H. Stanley
Vice President and
Chief Financial Officer


Agreed and accepted:

ZENGINE, INC.

By:  /s/ Louis Lipinski
    ---------------------
      Louis Lipinski
      Chief Financial Officer



Date: August 17, 2000


Exhibit 10.7.1

WILBLAIRCO ASSOCIATES
222 West Adams Street
Chicago, Illinois 60606

April 6, 2000

Joseph M. Savarino
President
Zengine, Inc.
6100 Stewart Avenue
Fremont, California 94538

Re: Amendment to Registration Rights Agreement

Dear Mr. Savarino:

Pursuant to Section 13.1 of the Registration Rights Agreement by and among Zengine, Inc. (the "Company"), At Home Corporation and other Investors and the Founders dated September 30, 1999 (the "Agreement"), At Home Corporation hereby agrees to the following amendments to the Agreement:

1. Section 1 - The definition of "Investors" shall be deleted in its entirety and replaced with:

""Investors" means At Home, Wilblairco and REX."

2. Section 1 - There shall be added after the definition of "Registrable Securities" and before the definition of "Rule 144" the following definition:

""REX" means rexstores.com, Inc., an Ohio corporation."

3. Section 1 - The definition of "Registrable Securities" shall be revised as follows:

""Registrable Securities" means (a) any shares of Common Stock acquired by the Investors pursuant to that certain Stock Purchase Agreement of even date herewith by and among the Company, Miami Computer Supply Corporation and the Investors (the "Investors' Common Stock"); (b) any shares of Common Stock acquired by an Investor who is added to this Agreement by amendment; (c) any shares of Common Stock owned by a Founder on the date hereof or acquired by a Founder upon exercise of an option to purchase Common Stock outstanding on the date hereof (the "Founders' Common Stock") (the Investors' Common Stock and the Founders' Common Stock are sometimes collectively referred to herein as the "Holders' Common Stock"); (d) any shares of Common Stock which were issued as, or were issued directly or indirectly upon the conversion of other securities issued as, a dividend or other distribution with respect to, or in replacement of, the Holders' Common Stock; and (e) any shares of Common Stock then issuable directly or indirectly upon the conversion or exercise of other securities issued as a dividend or other distribution with respect to, or in replacement of, the Holders' Common Stock; PROVIDED, HOWEVER, that outstanding shares of Common Stock shall no longer be Registrable Securities when they shall have been
(y) effectively registered under the Securities Act and sold by the holder thereof in accordance with such registration, or (z) sold to the public pursuant to Rule 144."


Joseph M. Savarino
April 6, 2000

Page 2

Please countersign this letter amendment and have rexstores.com, Inc. execute the joinder agreement below and return an original copy of this correspondence to me at your earliest convenience.

Sincerely,

WILBLAIRCO ASSOCIATES

By: /s/ Mark Brady
   ---------------------------------
Name: Mark Brady
     -------------------------------
Title: Partner
       -----------------------------

Agreed and accepted this __ day of ____________, 2000.

AT HOME CORPORATION

By:      ___________________________
Name:    ___________________________
Title:   ___________________________

ZENGINE, INC.

By:      ___________________________
Name:    ___________________________
Title:   ___________________________

MIAMI COMPUTER SUPPLY CORPORATION

                              By:      ___________________________
                              Name:    ___________________________
                              Title:   ___________________________


                              FOUNDERS:___________________________
                                        Joseph M. Savarino

                                       ___________________________
                                        Lalit Dhadphale

                                       ___________________________
                                        Christopher Feaver

Joseph M. Savarino
April 6, 2000
Page 3

JOINDER AGREEMENT

Pursuant to Section 13.1 of the Agreement, the undersigned hereby joins in the Agreement ("Joinder") and agrees to be deemed an "Investor" under the Agreement and to abide by all of the terms and conditions of the Agreement as an Investor party thereto from and after the date hereof with respect to shares of common stock, no par value per share, of Zengine, Inc. ("Common Stock") issuable upon the proper exercise of the Warrant to purchase shares of the Common Stock.

IN WITNESS WHEREOF, the said Investor has executed this Joinder, this 6th day of April, 2000.

rexstores.com, Inc.

By:________________________________ Name: Stuart Rose

Title: Chief Executive Officer


Exhibit 10.8.1

ZENGINE, INC.
6100 STEWART AVENUE
FREMONT, CA 94538

April 6, 2000

Wilblairco Associates
222 West Adams
Chicago, Illinois 60606

Re: Amendment to Stockholders Agreement

Dear Sir:

Pursuant to Section 10.1 of the Stockholders Agreement by and among Zengine, Inc. ("Zengine"), Wilblairco Associates ("Wilblairco"), At Home Corporation ("At Home"), Miami Computer Supply Corporation ("MCSC"), Joseph M. Savarino, Lalit Dhadphale and Christopher Feaver dated September 30, 1999 (the "Agreement"), the undersigned parties hereby agree to the following amendment to the Agreement:

1. The first paragraph of the Agreement is deleted in its entirety and replaced with:

"THIS STOCKHOLDERS AGREEMENT is made and entered into as of the 30th day of September, 1999, by and among Zengine, Inc., a Delaware corporation (the "Company"), Miami Computer Supply Corporation, an Ohio corporation (the "Parent") and each of the Persons listed on Schedule A hereto (collectively, the "Investors")."

2. The first "WHEREAS" paragraph of the Agreement is deleted in its entirety and replaced with:

"WHEREAS, the Parent and the Investors are collectively referred to as the `STOCKHOLDERS' and individually as a `STOCKHOLDER.'"

3. Schedule B is deleted in its entirety.

Please countersign this letter amendment to reflect your agreement hereto.

Sincerely,

Joseph M. Savarino President


Amendments to Stockholders Agreement
April 6, 2000

Page 2

Agreed and accepted:

                                                                       AT HOME CORPORATION

Date:                               , 2000                             By:
         ---------------------------                                            -----------------------------------
                                                                       Name:
                                                                                -----------------------------------
                                                                       Title:
                                                                                -----------------------------------

                                                                       WILBLAIRCO ASSOCIATES

Date:                               , 2000                             By:      /s/ Mark Brady
         ---------------------------                                            -----------------------------------
                                                                       Name:    Mark Brady
                                                                                -----------------------------------
                                                                       Title:   Partner
                                                                                -----------------------------------


                                                                       REX STORES CORPORATION

Date:                               , 2000                             By:
         ---------------------------                                            -----------------------------------
                                                                       Name:
                                                                                -----------------------------------
                                                                       Title:
                                                                                -----------------------------------

                                                                       MIAMI COMPUTER SUPPLY
                                                                       CORPORATION

Date:                               , 2000                             By:
         ---------------------------                                            -----------------------------------
                                                                       Name:
                                                                                -----------------------------------
                                                                       Title:
                                                                                -----------------------------------

                                                                       FOUNDERS:

Date:                               , 2000
         ---------------------------                                   --------------------------------------------
                                                                       Joseph M. Savarino


                                                                       --------------------------------------------
Date:                               , 2000                             Lalit Dhadphale
         ---------------------------
Date:                               , 2000
         ---------------------------                                   --------------------------------------------
                                                                       Christopher Feaver


ADDENDUM TO
STOCKHOLDERS' AGREEMENT

This Addendum to the Stockholders' Agreement by and among Zengine, Inc., Miami Computer Supply Corporation, the Investors and Option Holders dated September 30, 1999 (the "Agreement") is dated this 6th day of April, 2000.

Pursuant to Section 7(b) of the Agreement, the undersigned hereby joins in this Agreement and agrees to be deemed an "Investor" under the Agreement and to abide by all of the terms and conditions of the Agreement as an Investor party thereto from and after the date hereof with respect to the Warrant to purchase shares of the common stock, no par value per share ("Common Stock"), of Zengine, Inc., to be dated upon the date of issue, and with respect to the shares of Common Stock which may be issued upon the proper exercise of such Warrant.

IN WITNESS WHEREOF, the said Investor has executed this Addendum this 6th day of April, 2000.

REX STORES CORPORATION

By:__________________________________
Name: Stuart Rose
Title: Chief Executive Officer

Agreed and accepted by:

FOUNDERS: AT HOME CORPORATION:

_________________________________       By:    ________________________________
Joseph Savarino                         Name:  ________________________________
Date:____________________________       Title: ________________________________
                                        Date:  ________________________________

_________________________________       WILBLAIRCO ASSOCIATES
Lalit Dhadphale
Date:____________________________       By:    /s/ Mark Brady
                                               --------------------------------
_________________________________       Name:  Mark Brady
Christopher Feaver                             --------------------------------
Date: ___________________________       Title: Partner
                                               --------------------------------
                                        Date:  4/13/00
                                               --------------------------------

Addendum to Stockholders' Agreement
Page 2

ZENGINE, INC.                           MAIMI COMPUTER SUPPLY
                                        CORPORATION

By:   ___________________________       By:   _________________________________
Name: ___________________________       Name: _________________________________
Title:___________________________       Title:_________________________________


Date:____________________________       Date:__________________________________


Exhibit 10.13

STRATEGIC ALLIANCE AGREEMENT

This Strategic Alliance Agreement (this "Agreement"), dated and effective as of April 3, 2000 (the "Effective Date"), is by and among United Stationers Supply Co., an Illinois corporation ("USSCO"), e-Nited, a division of USSCO ("e-Nited") and Zengine, Inc., a Delaware corporation ("Zengine") (USSCO, e-Nited and Zengine each a "Party" and collectively, the "Parties" herein).

RECITALS

USSCO, the largest general line business products wholesaler in the United States, distributes over 35,000 stock keeping units through a national network of more than 20,000 resellers using a computer-based network of 65 distribution centers nationwide;

Zengine's proprietary and scaleable technology and infrastructure enables a high speed, personalized e-commerce experience on the Internet, permitting its clients to "self brand" their e-commerce storefronts and maintain their customers within their Websites;

e-Nited will administer an electronic logistics operating system and physical distribution infrastructure through which users can procure, manage and monitor product fulfillment, transportation and other logistics services for simple and complex shipments of a variety of products;

e-Nited and Zengine believe that each could expand its client base by cross-promoting the use of their respective services to their respective existing and future customers;

The Parties desire to form a strategic alliance to cross-promote the use of their respective services to their respective existing and future customers on the terms and conditions set forth herein; and

NOW, THEREFORE, in consideration of the premises, the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, USSCO, e-Nited and Zengine hereby agree as follows:

1.       DEFINITIONS.  Capitalized terms not defined in the body of this
Agreement  shall have the meanings set forth below:

         "Affiliate" or "Affiliated with" means any Person that controls, is

controlled by or is under common control with such Party. For purposes of this Agreement, "control" shall mean the possession directly or indirectly, of a majority of the voting power of such Person or the ability to materially influence the management or policies of such Person.

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"Business Day" is any day banks are open for business in the State of California. (So, for example, if an event were to occur on Independence Day, July 4, which is a Wednesday, the event will occur on the next business day, or July 5, which would be a Thursday.)

"Confidential Information" means any information of a Party disclosed to another Party in the course of this Agreement which is identified as, or should be reasonably understood to be, confidential to the disclosing party, including but not limited to, quantities, pricing, knowhow, trade secrets, innovations, Data, technical processes and formulas, source and object codes, product designs, sales, cost and other unpublished financial information, product and business plans, projections, marketing data and this Agreement and all exhibits and schedules hereto. "Confidential Information" shall not include information which: (i) is known or becomes known to the recipient directly or indirectly from a third party source other than one having an obligation of confidentiality to the disclosing party; (ii) is or becomes publicly available or otherwise ceases to be secret or confidential, except through a breach of this Agreement by the recipient; (iii) is or was independently developed by the recipient without use or reference to the disclosing party's confidential Information, as shown by evidence in the recipient's possession; or (iv) is known by the recipient prior to disclosure thereof by the disclosing party (as established documentary evidence).

"Customer" means all present and future customers of a Party.

"Environmental Health and Safety Laws" means all applicable federal, state and local laws, rules, regulations, orders, guidelines, ordinances and requirements relating to pollution or protection of the environment, public health and safety, or employee health and safety, including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. 9601 et seq., the Resource Conservation and Recovery Act of 1976, 42 U.S.C. 6901 et seq., the Emergency Planning and Community Right-to-Know Act, 42 U.S.C. 1001 et seq., the Clean Air Act, 42 U.S.C. 7401 et seq., the Federal Water Pollution Control Act, 33 U.S.C. 1251 et seq., the Toxic Substances Control Act, 15 U.S.C. 2601 et seq., the Safe Drinking Water Act, 42 U.S.C. 3001 et seq., the Hazardous Materials Transportation Act, 49 U.S.C. 1801, and the Occupational Safety and Health Act, 42 U.S.C. 651 et seq., each as amended, and any regulations, rules, ordinances adopted or publications promulgated pursuant thereto.

"ERISA" means the Employee Retirement Income Security Act of 1974, as amended, together with all rules and regulations promulgated thereunder.

"Intellectual Property" means any and all of the following which is owned by, licensed by, licensed to, used or held for use by e-Nited, USSCO or Zengine (including all copies and embodiments thereof, in electronic, written or other media): (i) all registered and unregistered trademarks, trade dress, service marks, logos, trade names, corporate names (including but not necessarily limited to the name "e-Nited" or "USSCO" or "Zengine" and all applications to register the same (the "Trademarks"); (ii) all issued U.S. and foreign patents and pending patent applications, including but not limited to reissuances, continuations and continuations-in-part, patent disclosures and improvements thereto (the "Patents"); (iii) all registered and unregistered copyrights, mask work rights and all applications to register the same (the "Copyrights"); (iv) all computer software and databases owned or used (excluding software and databases licensed to e-Nited, USSCO or Zengine under standard, nonexclusive software licenses which are generally commercially available to end-user customers from third parties in the ordinary course of such third parties' businesses) by e-Nited, USSCO or Zengine or under development for e-Nited, USSCO or Zengine by third parties (the "Software"), (v) all categories of trade secrets, know-how, inventions (whether or not patentable and whether or not reduced to

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practice), processes, procedures, drawings, specifications, designs, plans, proposals, technical data, copyrightable works, financial, marketing, and business, data, pricing and cost information, business and marketing plans, customer and supplier lists and information and other confidential and proprietary information ("Proprietary Rights"); (vi) all licenses and agreements pursuant to which e-Nited, USSCO or Zengine has acquired rights in or to any of the Trademarks, Patents, Copyrights, Software or Proprietary Rights (excluding software and databases licensed to e-Nited, USSCO or Zengine under standard, non-exclusive software licenses which are generally commercially available to end-user customers from third parties in the ordinary course of such third parties' businesses) ("Licenses-In"); and (vii) all licenses and agreements pursuant to which e-Nited, USSCO or Zengine has licensed or transferred any rights to any of the Trademarks, Patents, Copyrights, Software or Proprietary Rights (excluding software licensed by e-Nited, USSCO or Zengine under standard, non-exclusive software licenses to end-user customers in the ordinary course of business which do not include rights to sublicense) ("Licenses-Out").

"Internet" means the principal international computer network interconnecting computers and other networks through Internet protocol pursuant to which Websites can be accessed.

"Liens" means any and all mortgages, pledges, security interests, liens, charges, options, conditional sales agreements, claims, restrictions, covenants, title defects or other encumbrances or restrictions of any nature.

"Person" means any individual, proprietorship, partnership, corporation, limited liability company, joint venture, association, business trust, trust, group of entities or persons acting in concert to achieve a particular goal, or governmental authority or court.

"Website" means the primary local language electronic location on the Internet's World Wide Web accessible to the public at the party's specific Uniform Resource Locator which may contain text, graphics, visual images and/or sound.

2. STRATEGIC ALLIANCE.

2.1 ALLIANCE. Subject to, and in accordance with, the terms and conditions of this Agreement, USSCO, e-Nited and Zengine hereby establish a strategic alliance (the "Alliance") pursuant to which each agrees to promote the other in its normal marketing activities as a "preferred provider" of the e-commerce Services offered by Zengine (on the one hand) and the Logistics Services offered by e-Nited (on the other) as further described herein.

2.2 ALLIANCE LIAISONS. USSCO, e-Nited and Zengine will each appoint one
(1) person to serve as its Alliance liaison (the "Alliance Liaisons"). The Alliance Liaisons will serve as contact persons for their respective Parties with respect to matters relating to the Alliance and will manage the relationship established between the Parties by this Agreement. Either Party may at any time and in its sole discretion, remove its respective Alliance Liaison and appoint a different person to that position. Upon appointment of a new Alliance Liaison, the Party making such appointment shall notify the other Party of such appointment in writing within five (5) Business Days. The initial Alliance Liaisons are as follows:

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For USSCO:

General Counsel United Stationers Supply Co.

2200 East Golf Road
Des Plaines, Illinois 60016

         Telephone Number: (847) 699-4787
         Fax Number:       (847) 699-4716
         Email Address:    smaloney-meyer@ussco.com

For e-Nited:

         Cameron McKennitt
         e-Nited
         2200 East Golf Road
         Des Plaines, Illinois  60016
         Telephone number: (847) 699-4787
         Fax Number:       (874) 699-4716
         Email Address:    cmckennitt@ussco.com

For Zengine:

         Joseph M. Savarino
         Zengine, Inc.

6100 Stewart Avenue
Fremont, California 94538 Telephone Number: (510) 651-6400 Fax Number: (510) 651-3200 Email Address: jsavarino@zengine.com

2.3 QUARTERLY MEETINGS. The executive officers, their designee and/or the Alliance Liaisons of USSCO, e-Nited and Zengine will meet on a quarterly basis to review and discuss Alliance operations, performance, marketing and strategy. Unless otherwise agreed to by the Parties, the first such quarterly meeting shall be held in June, 2000, with the subsequent meetings to be held each September, December, March and June thereafter during the Term (as defined in Section 3 below) of this Agreement. Such meetings shall be held on a date and at a time and location to be agreed upon by the Parties not less than ten (10) Business Days before each meeting. At each such meeting, the Parties shall appoint one (1) person to keep and prepare minutes of the proceedings, which minutes shall reflect all agreements reached and all actions taken or directed to be taken by the Parties at such meeting.

3. TERM

3.1 INITIAL TERM. Unless earlier terminated in accordance with the provisions of Section 8.1 hereof, the initial term of this Agreement (the "Initial Term") is one (1) year, commencing on the Effective Date and extending through the first (1st) anniversary of that date, after which this Agreement shall terminate unless extended pursuant to Section 3.2 below (the Initial Term together with all such extensions, the "Term").

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3.2 EXTENSION OF INITIAL TERM. The Initial Term may be extended by the mutual agreement of the Parties prior to, the expiration of the Initial Term.

4. JOINT MARKETING

4.1 CROSS-PROMOTION. USSCO, e-Nited and Zengine have entered into and created the Alliance to achieve the following goals:

(a) To promote Zengine to e-Nited's Customers as a preferred provider of outsourced e-commerce services, including: (i) product content, such as user interface and design, product comparisons, product compatibility, user reviews and related accessories; (ii) payment processing, including shopping cart and wallet, express checkout, fraud screening, tax and export compliance, electronic mail ("e-mail") and order tracking; (iii) merchandising, including user ratings and top seller lists, gift certificates and coupons, real time reporting and analysis and advanced customer targeting and profiling (the "e-commerce Services").

(b) To promote e-Nited to Zengine's Customers as a preferred provider of electronic logistics and physical distribution services, including, (a) warehousing and inventory storage; (b) inventory management and tracking; (c) picking and packaging of inventory; (d) delivery of inventory to end-users in accordance with client needs and as early as same or next business day; (e) delivery tracking; and (f) product return administration (the "Logistics Services").

(c) To work together to achieve growth in e-Nited's Logistics Services business and in Zengine's e-commerce Services business.

(d) To provide the Customers of each of e-Nited and Zengine with the best integrated and integratable services and solutions to meet their respective fulfillment logistics and e-commerce needs at competitive prices.

4.2 PROVISION OF SERVICES. (a)(i) During the Term, e-Nited will be a preferred provider of Logistics Services to Zengine. In that regard, Zengine will cause all of its sales representatives to: (i) become knowledgeable about e-Nited's service offerings and to participate in e-Nited sales training as agreed by the Parties from time to time pursuant to Section 2.3; (ii) actively promote e-Nited as a preferred provider of Logistics Services to Zengine's Customers; and (iii) promptly forward to the e-Nited Alliance Liaison all indications of interest, inquiries, contact information (one or more of: name, street address, telephone and/or fax number or e-mail address), feed back and complaints relating to the Customer's need or desire for, or any discussion about, the Logistics Services. Whenever reasonably possible, Zengine shall cause its sales representatives to promote the Alliance by referring to its "alliance" with e-Nited as a "preferred provider of delivery and logistics services" to Zengine's Customers.

(ii) Notwithstanding the provisions of Section 4.2(a)(i) above, Zengine shall not be obligated under Section 4.2(a)(i):

(A) to the extent a Zengine Customer has an existing obligation to a provider of Logistics Services other than e-Nited;

(B) where a provider of Logistics Services brings the Customer to Zengine;

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(C) where e-Nited is unable or unwilling to provide Logistics Services to the Zengine Customer that are competitive in service and price with other alternatives;

(D) where a significant benefit may be derived by Zengine and/or the Zengine Customer from utilizing an alternative Logistics Services provider (such as Zengine's parent, Miami Computer Supply Corporation ("MCSC")) or e-Nited has notified Zengine in writing that it will not or is unable to deliver the Customer's desired Logistics Services; or

(E) where a Customer insists on an alternative (or no) Logistics Services or where the Customer engages another Person to provide the Logistics Services, whether prior to or following discussions with e-Nited.

(iii) All Logistics Services shall be negotiated by representatives of e-Nited and the Zengine sales representatives shall not be authorized to discuss terms of agreement or pricing with any Zengine Customer who desires to obtain Logistics Services.

(iv) When Zengine offers e-Nited a new business opportunity, e-Nited shall have seven (7) Business Days to (x) determine whether it wishes to pursue negotiations with the Customer, (y) notify Zengine in writing or by voice contact with an Alliance Liaison of such determination (it being understood that any failure of e-Nited to so notify Zengine shall be deemed a determination not to pursue such negotiations), and (z) if requested by the relevant Customer, make appropriate personnel available to begin negotiations at the Customer's request. Failure of e-Nited to respond within the seven (7) Business Day period shall excuse Zengine from its preferred provider obligations with respect to such opportunity. For purposes of this Section 4.2(a)(iv), the seven (7) Business Day period shall begin to run once e-Nited has been given (or has otherwise obtained) reasonably sufficient information concerning the scope of the business opportunity in question.

(b)(i) During the Term, Zengine shall be a preferred provider of e-commerce Services to e-Nited. In that regard, e-Nited shall cause all of its sales representatives to: (i) become knowledgeable about Zengine's service offerings and to participate in Zengine's sales training as Zengine may institute and notice e-Nited from time to time; (ii) actively promote Zengine as a preferred provider of e-commerce Services to e-Nited's Customers; and (iii) promptly forward to the Zengine Alliance Liaison all indications of interest, inquiries, contact information (one or more of: name, street address, telephone and/or fax number or e-mail address), feedback and complaints relating to the Customer's need or desire for, or any discussion about, e-commerce Services. Wherever reasonably possible, e-Nited shall cause its sales representatives to promote the Alliance by referring to its "alliance" with Zengine as a "preferred provider of e-commerce services" to e-Nited's Customers.

(ii) Notwithstanding the provisions of Section 4.2(b)(i) above, e-Nited shall not be obligated under Section 4.2(b)(i):

(A) to the extent an e-Nited Customer has an existing obligation to a provider of e-commerce services other than Zengine;

(B) where a provider of e-commerce services brings the Customer to e-Nited;

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(C) where Zengine is unable or unwilling to provide e-commerce Services to the e-Nited Customer that is competitive in service and price with other alternatives;

(D) where a significant benefit may be derived by e-Nited and/or the e-Nited Customer from utilizing an alternative e-commerce services provider or Zengine has notified e-Nited in writing that it will not or is unable to deliver the Customer's desired e-commerce Services;

(E) where the Customer insists on an alternative (or no) e-commerce services provider or where the Customer engages another Person to provide e-commerce services, whether prior to or following discussions with Zengine; or

(F) where the Customer is a reseller primarily in the office supplies business.

(iii) All e-commerce Services shall be negotiated by representatives of Zengine and the e-Nited sales representatives shall not be authorized to discuss terms of agreement or pricing with any e-Nited Customer who desires e-commerce services.

4.3 INTEGRATION COOPERATION. The Parties shall work together to integrate Zengine's KORE computer system platform with e-Nited's distribution and fulfillment computer system for the purpose of offering a seamlessly integrated solution that is integratable with the Customers' computer systems.

4.4 NOTICE OF CONTRACT. (a) Should any e-Nited Customer enter into a contract with Zengine to have Zengine provide to the Customer e-commerce Services, Zengine shall provide to e-Nited notice of such contract promptly after it is executed by the Customer.

(b) Should any Zengine Customer enter into a contract with e-Nited to have e-Nited provide to the Customer Logistics Services, e-Nited shall provide to Zengine notice of such contract promptly after it is executed by the Customer.

4.5 MARKETING MATERIALS. The Alliance Liaisons will develop joint marketing materials to promote the Alliance and the services of e-Nited and Zengine (including (a) promotional and sales materials, brochures and advertising materials and (b) press releases, speeches and other publicity events) to Customers. Copies of all such materials will be approved by all of the members of the Alliance in advance of the distribution, publication or of activities conducted or made with respect thereto.

4.6 CROSS SELLING. e-Nited and Zengine will design a cross-selling incentive plan in which their respective sales forces will participate. Sales personnel of each such Party will receive training from the other Party and will be encouraged to promote the Logistics Services provided by e-Nited and the e-commerce Services provided by Zengine, as applicable. To that end, each of e-Nited and Zengine will provide the other Party with direct access to its Customers for the purpose of promoting their Logistics Services and e-commerce Services, respectively.

4.7. USE OF THE e-NITED MARKS. (a) e-Nited hereby grants to Zengine a world-wide, non-exclusive, royalty free, nontransferable license to use the e-Nited Marks described on SCHEDULE A, attached hereto and made a part hereof (the "e-Nited Marks") during the Term for the purpose of marketing, promoting and selling the Alliance and e-Nited's Logistics Services promoted to the Customers of Zengine in accordance with the

7

terms of this Agreement. Zengine shall properly display and use the e-Nited Marks in accordance with this Agreement.

(b) (i) e-Nited has the right, at all reasonable times, upon reasonable prior notice to inspect Zengine's relevant facilities and review the manner in which Zengine uses the e-Nited Marks so that e-Nited may satisfy itself that the e-Nited Marks are used in accordance with this Agreement; provided, however, that e-Nited will not exercise such right in a manner which interferes with Zengine's normal business operations.

(ii) Zengine shall adhere to the trademark usage guidelines ("e-Nited Trademark Usage Guidelines") and the marketing communications guidelines (the "e-Nited Marketing Communications Guidelines") furnished by e-Nited for the depiction of the e-Nited Marks and any reasonable modifications or amendments thereto. In the event of a conflict between this Agreement on the one hand and either of the e-Nited Trademark Usage Guidelines or e-Nited Marketing Communications Guidelines on the other hand, this Agreement shall govern.

(iii) Zengine shall include on all advertising and promotional materials, packaging and labels bearing the e-Nited Marks the following notice:

"[e-NITED MARKS] is a registered trademark of e-Nited. Used under license."

With respect to electronic presentations of the e-Nited Marks, this notice may be contained on Zengine's Website under "Legal Information" or, if software, in the "About" box or where Zengine's own proprietary notices appear.

(iv) Prior to any first use of the e-Nited Marks on advertising or promotional materials by Zengine, Zengine agrees to furnish e-Nited with samples of such advertising and promotional materials, packaging and labels bearing any of the e-Nited Marks for trademark usage approval (which approval shall not be unreasonably withheld, conditioned or delayed). Zengine shall amend the future use of the e-Nited Marks in any such advertising and promotional materials, packaging and labels if the use of the e-Nited Marks are not approved by e-Nited. e-Nited will have ten (10) Business Days from the date of receipt to approve or object to materials submitted for trademark usage approval. If no objection is received by Zengine within such ten (10) Business Days, such materials will be deemed approved. Use of the e-Nited Marks by Zengine that is substantially identical to uses of the e-Nited Marks that have previously been approved or that is being used for the same program (with substantially similar presentation of the e-Nited Marks) as has previously been approved do not require submission for approval.

(v) Zengine must immediately cease using any previously approved material from which e-Nited withdraws its approval. e-Nited will not unreasonably rescind approval of any materials previously approved.

(c) (i) Zengine acquires and will acquire no rights, title or interest in the e-Nited Marks or the goodwill associated with them, other than the right to use the e-Nited Marks in accordance with this Agreement. In accepting this Agreement, Zengine acknowledges e-Nited's ownership of the e-Nited Marks, its validity and the goodwill connected with it. Zengine will not attack the e-Nited Marks, nor assist anyone in attacking it. Zengine further agrees that Zengine will not make any application to register the e-Nited Marks, nor will Zengine use any confusingly similar trademark, service mark, trade name, or derivation, during the Term of this Agreement or thereafter. This paragraph will survive the termination of this Agreement.

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(ii) e-Nited represents and warrants that, as of the date hereof, to the best of its knowledge, the e-Nited Marks do not infringe upon any trademarks and are not involved in any opposition, invalidation, cancellation or litigation that would threaten Zengine's use of the e-Nited Marks in connection with the transactions contemplated by this Agreement and, to e-Nited's knowledge, no such action is threatened with respect to the e-Nited Marks. In the event that such action occurs, e-Nited will vigorously protect the e-Nited Marks.

(d) Zengine shall promptly notify e-Nited of any unauthorized use of the e-Nited Marks that comes to Zengine's attention. e-Nited in its reasonable discretion may take such action as may be required to prosecute the infringement. In the event that e-Nited decides that action should be taken against such third parties, e-Nited may take such action either in its own name or alternatively, e-Nited may authorize Zengine to initiate such action in Zengine's name but Zengine shall have no obligation to do so. In either event, Zengine agrees to cooperate fully with e-Nited, at e-Nited's expense, to whatever extent it is necessary to prosecute such action, all damages that may be recovered being solely for the account of e-Nited.

(e) In the event Zengine violates the e-Nited Trademark Usage Guidelines or the e-Nited Marketing Communications Guidelines and continues to do so for a continuous forty five (45) day period or for three (3) periods of thirty (30) days each during a calendar year following written notice from e-Nited, such violation shall constitute a material breach of this Agreement and e-Nited may terminate this Agreement in accordance with Section 8.1(c) hereof.

(f) The Parties agree that a breach of this Section 4.7 may give rise to irreparable injury to e-Nited that cannot be compensated for adequately by damages. Consequently, the Parties agree that e-Nited shall be entitled, in addition to all other remedies available, to injunctive and other equitable relief to prevent a breach of this Section 4.7 and to secure the enforcement of the provisions of this Section 4.7 in any court of competent jurisdiction in the United States or any state thereof (and the Parties agree to waive any requirement for the posting of bond in connection with such remedy).

4.8. USE OF THE ZENGINE MARKS. (a) Zengine hereby grants to e-Nited a world-wide, non-exclusive, royalty free, nontransferable license to use the Zengine Marks described on SCHEDULE B, attached hereto and made a part hereof (the "Zengine Marks") during the Term for the purpose of marketing, promoting and selling the Alliance and the Zengine e-commerce Services to the Customers of e-Nited in accordance with the terms of this Agreement. e-Nited shall properly display and use the Zengine Marks in accordance with this Agreement.

(b) (i) Zengine has the right, at all reasonable times, upon reasonable prior notice, to inspect e-Nited's relevant facilities and review the manner in which e-Nited uses the Zengine Marks so that Zengine may satisfy itself that the Zengine Marks are used in accordance with this Agreement; provided, however, that Zengine will not exercise such right in a manner which interferes with e-Nited's normal business operations.

(ii) e-Nited shall adhere to the trademark usage guidelines furnished by Zengine for the depiction of the Zengine Marks ("Zengine Trademark Usage Guidelines") and any reasonable modifications or amendments thereto. e-Nited shall also adhere to the marketing communications guidelines furnished by Zengine and any reasonable modifications or amendments thereto (the "Zengine Marketing Communications Guidelines"). In the event of a conflict between this Agreement on the one hand and either of the Zengine Trademark Usage Guidelines or Zengine Marketing Communications Guidelines on the other hand, this Agreement shall govern.

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(iii) e-Nited shall include on all advertising and promotional materials, packaging and labels bearing the Zengine Marks the following notice:

"[ZENGINE MARKS] is a registered trademark of Zengine, Inc. Used under license."

With respect to electronic presentations of the Zengine Marks, this notice may be contained on e-Nited's Website under "Legal Information" or, if software, in the "About" box or where e-Nited's own proprietary notices appear.

(iv) Prior to any first use of the Zengine Marks on advertising or promotional materials by e-Nited, e-Nited agrees to furnish Zengine with samples of such advertising and promotional materials, packaging and labels bearing any of the Zengine Marks for trademark usage approval (which approval shall not be unreasonably withheld, conditioned or delayed). e-Nited shall amend the future use of the Zengine Marks in any such advertising and promotional materials, packaging and labels if the use of the Zengine Marks are not approved by Zengine. Zengine will have ten (10) Business Days from the date of receipt to approve or object to materials submitted for trademark usage approval. If no objection is received by e-Nited within such ten (10) Business Days, such materials will be deemed approved. Use of the Zengine Marks by e-Nited that is substantially identical to uses of the Zengine Marks that have previously been approved or that is being used for the same program (with substantially similar presentation of the Zengine Marks) as has previously been approved do not require submission for approval.

(v) e-Nited must immediately cease using any previously approved material from which Zengine withdraws its approval. Zengine will not unreasonably rescind approval of any materials previously approved.

(c) (i) e-Nited acquires and will acquire no rights, title or interest in the Zengine Marks or the goodwill associated with them, other than the right to use the Zengine Marks in accordance with this Agreement. In accepting this Agreement, e-Nited acknowledges Zengine's ownership of the Zengine Marks, its validity and the goodwill connected with it. e-Nited will not attack the Zengine Marks, nor assist anyone in attacking it. e-Nited further agrees that e-Nited will not make any application to register the Zengine Marks, nor will e-Nited use any confusingly similar trademark, service mark, trade name, or derivation, during the Term of this Agreement or thereafter. This paragraph will survive the termination of this Agreement.

(ii) At the request and sole expense of Zengine, e-Nited will execute any papers or documents reasonably necessary to protect the rights of Zengine in the Zengine Marks and execute and deliver such other documents as may be reasonably requested by Zengine.

(iii) Zengine represents and warrants that, as of the date hereof, to the best of its knowledge, the Zengine Marks do not infringe upon any trademarks and are not involved in any opposition, invalidation, cancellation or litigation that would threaten e-Nited's use of the Zengine Marks in connection with the transactions contemplated by this Agreement and, to Zengine's knowledge, no such action is threatened with respect to the Zengine Marks. In the event that such action occurs, Zengine will vigorously protect the Zengine Marks.

(d) e-Nited shall promptly notify Zengine of any unauthorized use of the Zengine Marks that comes to e-Nited's attention. Zengine in its reasonable discretion may take such action as may be required to prosecute the infringement. In the event that Zengine decides that action should be taken against such third parties,

10

Zengine may take such action either in its own name, or alternatively, Zengine may authorize e-Nited to initiate such action in e-Nited's name but e-Nited shall have no obligation to do so. In either event, e-Nited agrees to cooperate fully with Zengine, at Zengine's expense, to whatever extent it is necessary to prosecute such action, all damages that may be recovered being solely for the account of Zengine.

(e) In the event e-Nited violates the Zengine Trademark Usage Guidelines or the Zengine Marketing Communications Guidelines and continues to do so for a continuous forty-five (45) day period or for three (3) periods of thirty (30) days each during a calendar year following written notice from Zengine, such violation shall constitute a material breach of this Agreement and Zengine may terminate this Agreement in accordance with Section 8.1(c)hereof.

(f) The Parties agree that a breach of this Section 4.8 may give rise to irreparable injury to Zengine that cannot be compensated for adequately by damages. Consequently, the Parties agree that Zengine shall be entitled, in addition to all other remedies available, to injunctive and other equitable relief to prevent a breach of this Section 4.8 and to secure the enforcement of the provisions of this Section 4.8 in any court of competent jurisdiction in the United States or any state thereof (and the Parties agree to waive any requirement for the posting of bond in connection with such remedy).

5. DATA SHARING

5.1 DATA. For purposes of this Agreement, "Data" shall mean all information related to a Party's Customers, Website users and their activities on such Party's Website.

5.2 DATA OWNERSHIP. Each Party shall own its own Data

6. REPRESENTATIONS AND WARRANTIES OF USSCO AND E-NITED. USSCO and e-Nited represent and warrant to Zengine on the date hereof, except as set forth on the Schedules enumerated below, that:

6.1. ORGANIZATION AND QUALIFICATION. USSCO is a corporation duly organized and validly existing in good standing under the laws of Illinois and has the requisite legal and corporate power to own its property and to carry on its business as conducted by it. USSCO is qualified and authorized to transact business and is in good standing as a foreign corporation in each jurisdiction in which the failure to so qualify would have a material adverse effect on its business, properties or financial condition (a "Material Adverse Effect"). e-Nited is a wholly-owned division of USSCO.

6.2. POWER. USSCO and e-Nited have all requisite legal power to enter into this Agreement and to carry out and perform their respective obligations under the terms hereof.

6.3. AUTHORIZATION; NO BREACH. The execution, delivery and performance of this Agreement and all other agreements contemplated hereby to which USSCO and e-Nited are a party, have been duly authorized by USSCO and e-Nited. This Agreement and all other agreements contemplated hereby each constitutes a valid and binding obligation of USSCO and e-Nited, enforceable in accordance with their respective terms, except (i) as limited by bankruptcy, insolvency, fraudulent conveyance or other laws affecting the enforcement of creditors rights generally, (ii) that the availability of equitable relief is subject to the discretion of the court before which any proceeding therefor may be brought, and (iii) to the extent any indemnification provisions

11

herein may be limited by applicable law or public policy ((i) through (iii), the "Standard Exceptions"). The execution and delivery by USSCO and e-Nited of this Agreement and all other agreements contemplated hereby to which USSCO and e-Nited are a party, and the fulfillment of and compliance with the respective terms hereof by USSCO and e-Nited do not (i) conflict with or result in a breach of the terms, conditions or provisions of, (ii) constitute a default under,
(iii) result in the creation of any Lien, security interest, charge or encumbrance upon USSCO's capital stock or assets pursuant to, or (iv) give any third party the right to modify, terminate or accelerate any obligation under,
(v) result in a violation of, or (vi) require any authorization, consent, approval, exemption or other action by or notice to, any court or administrative or governmental body pursuant to USSCO's Charter or Bylaws or any law, statute, rule or regulation to which USSCO is subject, or any agreement, instrument, order, judgment or decree to which USSCO is subject.

6.4 INTELLECTUAL PROPERTY. (a) Other than the USSCO or e-Nited Intellectual Property covered by Licenses-In, the rights of USSCO or e-Nited in and to each item of the Intellectual Property are owned outright by USSCO or e-Nited, free and clear of any Liens, encumbrances, security interests and other rights. Except to the extent provided in the Licenses-In, USSCO's or e-Nited's rights in and to the Intellectual Property are freely assignable in its own name, including the right to create derivatives, and USSCO or e-Nited is under no obligation to pay any royalty (except for royalties for certain software license) or other compensation to any third party or to obtain any approval or consent for use of any of the Intellectual Property. None of the Intellectual Property is subject to any outstanding judgment, order, decree, stipulation, injunction or charge; no charge, complaint, action, suit, proceeding, hearing, investigation, claim, or demand is pending or, to the knowledge of USSCO or e-Nited, threatened, which challenges the legality, validity, enforceability, use or ownership of any of the Intellectual Property; and except to the extent provided in the Licenses-Out and contracts to provide services to third parties neither USSCO nor e-Nited has agreed to indemnify any Person for or against any interference, infringement, misappropriation, or other conflict with respect to USSCO's or e-Nited's Intellectual Property.

(b) USSCO or e-Nited owns or has the right to use all the Intellectual Property necessary to provide, produce, sell and license the services and products currently provided, produced, sold and licensed by USSCO or e-Nited, and to conduct USSCO's or e-Nited's business as presently conducted, and the consummation of the transactions contemplated hereby will not materially alter or impair any such rights, including any right of USSCO or e-Nited to use or sublicense any Intellectual Property owned by others. Neither USSCO nor e-Nited has any knowledge of any reason USSCO or e-Nited will not be able to continue to own, possess or have access to, and to use, license and sub-license on reasonable terms, all Intellectual Property and other proprietary rights necessary for the lawful conduct of their business as presently conducted and currently contemplated to be conducted, without any infringement or conflict with the rights of others.

(c) To USSCO and e-Nited's knowledge, no Intellectual Property owned by USSCO or e-Nited, and no product or service practiced, offered, licensed, sold or under development by USSCO or e-Nited, infringes any trademark, trade name, copyright, trade secret, patent, right of publicity, right of privacy or other proprietary right of any Person or would give rise to an obligation to render an accounting to any Person as a result of co-authorship, co-invention or an express or implied contract for any use or transfer which, in any such case, would have a Material Adverse Effect on USSCO or e-Nited. Neither USSCO nor e-Nited has received any notice of any patent, invention, trademark, copyright, service mark, trade name or trade secret of any other Person alleging or threatening to assert that USSCO's or e-Nited's use of any of the Intellectual Property infringes upon or is in conflict with any Intellectual Property or proprietary rights of any third party. Neither USSCO nor e-Nited has any knowledge of any basis for any charge or claim, threatened claim or any suit or

12

action asserting any such infringement or conflict or asserting that USSCO or e-Nited does not have the legal right to own, enforce, sell, license, sublicense, lease or otherwise use any such Intellectual Property, process, product or service, and USSCO and e-Nited have no knowledge of any facts which should give such Person reason to believe that there exists any basis for such claim, threatened claim or suit or that any such claim, threatened claim or suit may be asserted or instituted in the future.

6.5. LITIGATION. There is no action, suit, proceeding or investigation pending or, to USSCO's or e-Nited's knowledge, currently threatened against USSCO or e-Nited that questions the validity of this Agreement or the right of USSCO or e-Nited to enter into it, or to consummate the transactions contemplated hereby, or that might result, either individually or in the aggregate, in any material adverse changes in the assets, condition or affairs of USSCO or e-Nited, financially or otherwise.

7. REPRESENTATIONS AND WARRANTIES OF ZENGINE. Zengine represents and warrants to USSCO and e-Nited on the date hereof, except as set forth on the Schedules enumerated below that:

7.1. ORGANIZATION AND QUALIFICATION. Zengine is a corporation duly organized and validly existing in good standing under the laws of Delaware and has the requisite legal and corporate power to own its property and to carry on its business as conducted by it. Zengine is qualified and authorized to transact business and is in good standing as a foreign corporation in each jurisdiction in which the failure to so qualify would have a Material Adverse Effect on its business, properties or financial condition.

7.2. POWER. Zengine has all requisite legal power to enter into this Agreement and to carry out and perform its obligations under the terms hereof.

7.3. AUTHORIZATION; NO BREACH. The execution, delivery and performance of this Agreement and all other agreements contemplated hereby to which Zengine is a party have been duly authorized by Zengine. This Agreement and all other agreements contemplated hereby each constitutes a valid and binding obligation of Zengine, enforceable in accordance with their respective terms, except for the Standard Exceptions. The execution and delivery by Zengine of this Agreement and all other agreements contemplated hereby to which Zengine is a party, and the fulfillment of and compliance with the respective terms hereof by Zengine do not (i) conflict with or result in a breach of the terms, conditions or provisions of, (ii) constitute a default under, (iii) result in the creation of any Lien, security interest, charge or encumbrance upon Zengine's capital stock or assets pursuant to, or (iv) give any third party the right to modify, terminate or accelerate any obligation under, (v) result in a violation of, or
(vi) require any authorization, consent, approval, exemption or other action by or notice to, any court or administrative or governmental body pursuant to Zengine's Restated Charter or Bylaws or any law, statute, rule or regulation to which Zengine is subject, or any agreement, instrument, order, judgment or decree to which Zengine is subject.

7.4 INTELLECTUAL PROPERTY.

(a) Other than the Zengine Intellectual Property covered by Licenses-In, the rights of Zengine in and to each item of the Intellectual Property are owned outright by Zengine, free and clear of any Liens, encumbrances, security interests and other rights. Except to the extent provided in the Licenses-In, Zengine's rights in and to the Intellectual Property are freely assignable in its own name, including the right to create derivatives, and Zengine is under no obligation to pay any royalty (except royalties for certain software licenses) or other compensation to any third party or to obtain any approval or consent for use of any of the

13

Intellectual Property. None of the Intellectual Property is subject to any outstanding judgment, order, decree, stipulation, injunction or charge; no charge, complaint, action, suit, proceeding, hearing, investigation, claim, or demand is pending or, to the knowledge of Zengine, threatened, which challenges the legality, validity, enforceability, use or ownership of any of the Intellectual Property; and, except to the extent provided in the Licenses-Out and contracts to provide services to third parties, Zengine has never agreed to indemnify any Person for or against any interference, infringement, misappropriation, or other conflict with respect to Intellectual Property.

(b) Zengine owns or has the right to use all the Intellectual Property necessary to provide, produce, sell and license the services and products currently provided, produced, sold and licensed by Zengine, and to conduct Zengine's business as presently conducted, and the consummation of the transactions contemplated hereby will not materially alter or impair any such rights, including any right of Zengine to use or sublicense any Intellectual Property owned by others. Zengine has no knowledge of any reason Zengine will not be able to continue to own, possess or have access to, and to use, license and sub-license on reasonable terms, all Intellectual Property and other proprietary rights necessary for the lawful conduct of its business as presently conducted and currently contemplated to be conducted, without any infringement or conflict with the rights of others.

(c) To Zengine's knowledge, no Intellectual Property owned by Zengine, and no product or service practiced, offered, licensed, sold or under development by Zengine, infringes any trademark, trade name, copyright, trade secret, patent, right of publicity, right of privacy or other proprietary right of any Person or, except for co-authorship of content relating to Zengine's agreements to provide services to third parties, would give rise to an obligation to render an accounting to any Person as a result of co-authorship, co-invention or an express or implied contract for any use or transfer which, in any such case, would have a Material Adverse Effect on Zengine. Zengine has received no notice of any patent, invention, trademark, copyright, service mark, trade name or trade secret of any other Person alleging or threatening to assert that Zengine's use of any of the Intellectual Property infringes upon or is in conflict with any Intellectual Property or proprietary rights of any third party. Zengine has no knowledge of any basis for any charge or claim, threatened claim or any suit or action asserting any such infringement or conflict or asserting that Zengine does not have the legal right to own, enforce, sell, license, sublicense, lease or otherwise use any such Intellectual Property, process, product or service, and Zengine has no knowledge of any facts which should give such Person reason to believe that there exists any basis for such claim, threatened claim or suit or that any such claim, threatened claim or suit may be asserted or instituted in the future.

7.5. LITIGATION. There is no action, suit, proceeding or investigation pending or, to Zengine's knowledge, currently threatened against Zengine that questions the validity of this Agreement or the right of Zengine to enter into it, or to consummate the transactions contemplated hereby, or that might result, either individually or in the aggregate, in any material adverse changes in the assets, condition or affairs of Zengine, financially or otherwise.

8. TERMINATION

8.1 TERMINATION. This Agreement may be terminated (by written notice by the terminating party to the other parties) and the transactions contemplated hereby may be abandoned at any time prior to the end of the Term :

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(a) By mutual written consent of each of Zengine, USSCO and e-Nited;

(b) By either Zengine, USSCO or e-Nited if a governmental authority or arbitrator shall have issued an order, decree or ruling or taken any other action (which order, decree or ruling the Parties shall use their commercially reasonable efforts to lift), in each case permanently restraining, enjoining or otherwise prohibiting the transactions contemplated hereby, and such order, decree, ruling or other action shall have become final and nonappealable; or

(c) By Zengine if USSCO or e-Nited shall have breached, or failed to comply with, in any material respect any of its obligations under this Agreement or any representation or warranty made by USSCO or e-Nited shall have been incorrect in any material respect when made or shall have since ceased to be true and correct in any material respect, and such breach, failure or misrepresentation is not cured within thirty (30) days after notice thereof and such breaches, failures or misrepresentations, individually or in the aggregate, result or would reasonably be expected to result in a Material Adverse Effect to Zengine, and by e-Nited if Zengine shall have breached, or failed to comply with, in any material respect any of its obligations under this Agreement or any representation or warranty made by Zengine shall have been incorrect in any material respect when made or shall have since ceased to be true and correct in any material respect, and such breach, failure or misrepresentation is not cured within (30) days after notice thereof and such breaches, failures or misrepresentations, individually or in the aggregate, result or would reasonably be expected to result in a Material Adverse Effect to e-Nited; or

(d) By either Zengine or USSCO, if either of the other suffers a material deterioration in its financial condition such that it would be unable to properly perform its respective services for the Customers of the other Party.

8.2 EFFECT OF TERMINATION. If this Agreement is terminated as permitted by Section 8.1, such termination shall be without liability of any Party to any other Party, except that if such termination shall result from the (i) failure of any party to this Agreement to fulfill a condition to the performance of the obligations of the other Parties that is within the control of such Party, (ii) failure of any Party to this Agreement to perform a covenant or agreement contained in this Agreement, or (iii) breach by any Party to this Agreement of any representation or warranty contained in this Agreement made as of the date of this Agreement, such Party shall be fully liable for any and all damages incurred or suffered by any other Party as a result of such failure or breach. The provisions of Section 8.2 shall survive any termination of this Agreement pursuant to Section 8.1.

9. MISCELLANEOUS

9.1 EXPENSES. Each of the Parties hereto agree to bear all of their own expenses in connection with the transactions contemplated by this Agreement.

9.2. AMENDMENT AND WAIVER. (a) Any term, covenant, agreement or condition contained in this Agreement may be amended with, and only with, the written consent of the Parties hereto. Compliance by a Party with any such term, covenant, agreement or condition may be waived (either generally or in a particular instance and either retroactively or prospectively), by written instruments signed by the other Party or Parties.

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(b) This Agreement shall not be altered, amended or supplemented except by written agreement in accordance with Section 9.2(a) above. Any waiver of any term, covenant, agreement or condition contained in this Agreement shall not be deemed a waiver of any other term, covenant, agreement or condition, and any waiver of any default in any such term, covenant, agreement or condition shall not be deemed a waiver of any later default thereof or of any default of any other term, covenant, agreement or condition.

9.3 SEVERABILITY. The invalidity or unenforceability of any provision hereof in any jurisdiction shall not affect the validity, legality or enforceability of the remainder hereof, it being intended that all rights and obligations of the Parties hereunder shall be enforceable to the fullest extent permitted by law and the remainder of this Agreement shall be interpreted so as to reasonably effect the intent of the Parties.

9.4 SUCCESSORS AND ASSIGNS. This Agreement may not be assigned by any Party without the prior written consent of the other Party hereto. All representations, warranties, covenants and agreements of the Parties contained in this Agreement or made in writing in connection herewith, shall, except as otherwise provided herein, be binding upon and inure to the benefit of the Parties' respective permitted successors and assigns.

9.5 NOTICES. All communications in connection with this Agreement shall be in writing, and shall be deemed properly given if hand delivered or sent by telecopier (provided that such communication is confirmed by voice and same-day deposit in the United States mail first class postage prepaid) or overnight courier with adequate evidence of delivery or sent by registered or certified mail, postage prepaid and return receipt requested and, addressed to the Party at the address for notices set forth in Section 2.2 above, or such other addresses or persons as the recipient shall have designated to the sender by a written notice given in accordance with this Section 9.5. Any notice called for hereunder shall be deemed given when received.

9.6 GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the internal laws (and not choice of law rules) of the State of New York.

9.7 COUNTERPARTS. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original but all of which shall together constitute one and the same Agreement.

9.8 HEADINGS. The headings herein are solely for the convenience of the Parties and shall not serve to modify or interpret the text of the sections at the beginning of which they appear.

9.9 CONSTRUCTION AND REPRESENTATION. The Parties understand and acknowledge that they have each been represented by (or have had the opportunity to be represented by) counsel in connection with the preparation, execution and delivery of this Agreement. This Agreement shall not be construed against any Party for having drafted it.

9.10 CONFIDENTIALITY. (a) The Parties recognize that, in connection with the performance of this Agreement, each of them may disclose to the other its Confidential Information. The Party receiving any Confidential Information agrees to maintain the confidential status of such Confidential Information and not to use any such Confidential Information for any purpose other than the purpose for which it was originally disclosed to the receiving Party (i.e., the purpose of disclosure by each Party to the Purchaser is solely to permit the Purchaser to make an investment decision); and not to disclose any of such Confidential Information to any third party;

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(b) The Parties acknowledge and agree that each may disclose Confidential Information: (a) as required by applicable law or regulation, provided that each Party will use its best efforts to obtain confidential treatment or a protective order of any Confidential Information so disclosed;
(b) to their respective parents and each of their respective directors, officers, employees, partners, attorneys, accountants and other advisors, who are under an obligation of confidentiality, on a "need to know" basis; or (c) in connection with disputes or litigation between the Parties involving such Confidential Information; and each Party will use its best efforts to limit disclosure to that purpose and to ensure maximum application of all appropriate judicial safeguards (such as placing documents under seal). The Parties may each make press releases about the existence and contents of the Agreement with the prior approval of the other of the contents of the press release, which approval shall not be unreasonably withheld, conditioned or delayed. If the Party from whom approval is sought does not respond to a request to publish such press release within five (5) Business Days of submission for approval, such press release shall be deemed approved.

(c) Upon termination of this Agreement or upon the written request of a Party, each Party shall promptly return to the other all Confidential Information of the other Party, including all of the physical embodiments thereof in its possession, including all copies thereof, and shall cease using the same, except to the extent their use is licensed or otherwise permitted under this Agreement. Each Party shall certify to the other Party in writing compliance with this Section upon the return of such materials.

9.11 RELATIONSHIP OF PARTIES. Neither Party shall be deemed an employee, agent, partner or joint venturer of the other (regardless of how the relationship is explained to the public by one or more of the Parties). Neither Party shall make any commitment, by contract or otherwise, binding upon the other, nor represent that it has any authority to do so.

9.12 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement among the Parties relating to the Alliance supersedes all prior and contemporaneous agreements, representations and understandings among the Parties, whether written or oral.

9.13 FORCE MAJEURE. Neither Party shall be liable for damages and costs to the other Party arising out of delays or failures to perform its obligations under this Agreement if such delays or failures result from causes beyond its reasonable control. Notice of any such delays or failures and explanation of their causes must be given to the other within five (5) days of the occurrence.

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed on the day first above written.

e-NITED, A DIVISION OF UNITED
STATIONERS SUPPLY CO.

Witness: ________________________          By:______________________________
                                           Name: ___________________________
                                           Title:___________________________

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UNITED STATIONERS SUPPLY CO.

Witness: ________________________          By:______________________________
                                           Name: ___________________________
                                           Title:___________________________


                                           ZENGINE, INC.

Witness: ________________________          By:______________________________
                                           Name: ___________________________
                                           Title:___________________________

18

SCHEDULE A

e-NITED'S MARKS

19

SCHEDULE B

ZENGINE MARKS

20

Exhibit 23.1

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the use in this Registration Statement on Form S-1 of our report dated June 26, 2000 relating to the financial statements of Zengine, Inc., which appears in such Registration Statement. We also consent to the references to us under the headings "Experts", "Summary Financial Data" and "Selected Financial Data" in such Registration Statement.

/s/ PricewaterhouseCoopers LLP

PricewaterhouseCoopers LLP
Cincinnati, OH
August 21, 2000


Exhibit 99.5

June 16, 2000

Joseph Savarino
President
Zengine, Inc.
6100 Stewart Avenue
Fremont, California 94538

Re: Consent

Dear Joe:

Work.com consents to the use of its name and the description of the transaction with Zengine, Inc. as set forth in the Section entitled "Business- Case Studies" of Amendment No. 2 to the Form S-1 Registration Statement of Zengine, Inc. (SEC File No. 333-36312). This consent represents a limited license from Work.com to use the Company's name and logo in any capital raising document that describes the relationship between our companies.

Please feel free to contact me if you have any questions.

Sincerely,

WORK.COM

By:    /s/ Donald P. Hutchinson Jr.
      -------------------------------------

Name:  Donald P. Hutchinson
      -------------------------------------

Title: Chairman and Chief Executive Officer
      -------------------------------------


Exhibit 99.6

June 16, 2000

Joseph Savarino
President
Zengine, Inc.
6100 Stewart Avenue
Fremont, California 94538

Re: Consent

Dear Joe:

rexstores.com, Inc. consents to the use of its name and the description of the transaction with Zengine, Inc. as set forth in the Section entitled "Business- Case Studies" of Amendment No. 2 to the Form S-1 Registration Statement of Zengine, Inc. (SEC File No. 333-36312). This consent represents a limited license from rexstores.com, Inc. to use the Company's name and logo in any capital raising document that describes the relationship between our companies.

Please feel free to contact me if you have any questions.

Sincerely,

rexstores.com, Inc.

By:  /s/  Stuart Rose
   ------------------------------------
Name:     Stuart Rose
     ----------------------------------
Title:    Chief Executive Officer
      ---------------------------------


Exhibit 99.7

June 16, 2000

Joseph Savarino
President
Zengine, Inc.
6100 Stewart Avenue
Fremont, California 94538

Re: Consent

Dear Joe:

MCSi, Inc. consents to the use of its name and the description of the transaction with Zengine, Inc. as set forth in the Section entitled "Business- Case Studies" of Amendment No. 2 to the Form S-1 Registration Statement of Zengine, Inc. (SEC File No. 333-36312). This consent represents a limited license from MCSi, Inc. to use the Company's name and logo in any capital raising document that describes the relationship between our companies.

Please feel free to contact me if you have any questions.

Sincerely,

MCSi, INC.

By:    /s/  Ira Stanley
   -----------------------------------
Name:       Ira Stanley
     ---------------------------------
Title: Vice President, Chief Financial
         Officer
      --------------------------------


ARTICLE 5
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE SHEET OF ZENGINE INC. AT MARCH 31, 2000 AND JUNE 30, 2000 AND THE STATEMENT OF OPERATIONS FOR THE SIX MONTHS ENDED MARCH 31, 2000 AND THE NINE MONTHS ENDED JUNE 30, 2000 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
RESTATED:
CURRENCY: U.S. DOLLARS


PERIOD TYPE 6 MOS 9 MOS
FISCAL YEAR END SEP 30 2000 JUN 30 2000
PERIOD START OCT 01 1999 OCT 01 1999
PERIOD END MAR 31 2000 JUN 30 2000
EXCHANGE RATE 1 1
CASH 50,733 0
SECURITIES 0 0
RECEIVABLES 1,344,621 2,056,502
ALLOWANCES 0 0
INVENTORY 0 0
CURRENT ASSETS 4,574,766 4,709,742
PP&E 590,159 821,123
DEPRECIATION 102,200 165,711
TOTAL ASSETS 5,212,715 5,447,043
CURRENT LIABILITIES 792,573 1,159,952
BONDS 0 0
PREFERRED MANDATORY 0 0
PREFERRED 0 0
COMMON 0 0
OTHER SE 4,420,142 4,287,091
TOTAL LIABILITY AND EQUITY 5,212,715 5,447,043
SALES 2,710,916 5,104,286
TOTAL REVENUES 2,710,916 5,104,286
CGS 287,005 514,796
TOTAL COSTS 2,332,202 4,789,706
OTHER EXPENSES (81,464) (123,755)
LOSS PROVISION 0 0
INTEREST EXPENSE 0 0
INCOME PRETAX 173,173 (76,461)
INCOME TAX 0 0
INCOME CONTINUING 173,173 (76,461)
DISCONTINUED 0 0
EXTRAORDINARY 0 0
CHANGES 0 0
NET INCOME 173,173 (76,461)
EPS BASIC .02 (.01)
EPS DILUTED .01 (.01)