UNITED STATES
SECURITIES & EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q

(MARK ONE)

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

FOR THE QUARTERLY PERIOD ENDED: MARCH 31, 2001

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

FOR THE TRANSITION PERIOD FROM: _____________________ TO___________________

COMMISSION FILE NUMBER: 0-26071

EDGAR ONLINE, INC.

(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

DELAWARE 06-1447017

STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION IDENTIFICATION NO.)

50 WASHINGTON ST., NORWALK, CT 06854

(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)

(203) 852-5666

(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. [x] Yes [] No

Number of shares of common stock outstanding at May 14, 2001: 14,908,917 shares

EDGAR ONLINE, INC.
FORM 10-Q
FOR THE QUARTERS ENDED MARCH 31, 2001 AND 2000

INDEX

Page No.

PART I. FINANCIAL INFORMATION

ITEM 1. Financial Statements

Consolidated Balance Sheets
March 31, 2001 (unaudited) and December 31, 2000 ...................................... 3

Consolidated Statements of Operations
Three Months Ended March 31, 2001 (unaudited) and 2000 (unaudited) .................... 4

Consolidated Statements of Cash Flows
Three Months Ended March 31, 2001 (unaudited) and 2000 (unaudited) .................... 5

Notes to Consolidated Financial Statements ..................................................... 6

ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations .. 7

ITEM 3. Quantitative and Qualitative Disclosures About Market Risk .............................18

PART II. OTHER INFORMATION

ITEM 1. Legal Proceedings ......................................................................19

ITEM 2. Changes in Securities and Use of Proceeds ..............................................19

ITEM 3. Defaults Upon Senior Securities ........................................................19

ITEM 4. Submission of Matters to a Vote of Security Holders ....................................19

ITEM 5. Other Information ......................................................................19

ITEM 6. Exhibits and Reports on Form 8-K .......................................................19

Signatures .....................................................................................20

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PART 1. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

EDGAR ONLINE, INC.
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

March 31, 2001
(unaudited) December 31, 2000
--------------- -----------------

Cash and cash equivalents $ 1,423 $ 2,284
Available-for-sale investments 1,497 1,498
Accounts receivable, less allowance for doubtful accounts of $256 and
$345, respectively 2,344 2,790
Income tax receivable 979 979
Other current assets 221 127
-------- --------
Total current assets 6,464 7,678

Property and equipment, net 3,250 3,356
Intangible assets 26,563 27,307
Investments 521 575
Other assets 574 550
-------- --------
Total assets $ 37,372 $ 39,466
======== ========

LIABILITIES AND STOCKHOLDERS' EQUITY

Accounts payable and accrued expenses $ 2,172 $ 2,358
Notes payable and accrued interest 550 583
Deferred revenues 820 966
Capital lease payable, current portion 51 68
-------- --------
Total current liabilities 3,593 3,975

Capital lease payable, long-term -- 8
Notes payable 6,000 6,000
-------- --------
Total liabilities 9,593 9,983

Stockholders' equity:
Common stock, $0.01 par value, 30,000,000 shares
authorized, 14,908,917 shares issued and
outstanding 149 149
Preferred stock, $0.01 par value, 1,000,000
shares authorized, no shares issued or
outstanding -- --
Additional paid-in capital 53,486 53,483
Unrealized holding losses (3) (2)
Accumulated deficit (25,853) (24,147)
-------- --------
Total stockholders' equity 27,779 29,483
-------- --------
Total liabilities and stockholders'equity $ 37,372 $ 39,466
======== ========

See accompanying notes to consolidated financial statements

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EDGAR ONLINE, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)

Three Months Ended
March 31,
2001 2000
---- ----

Revenues:
Corporate contracts $3,270 $639
Individual subscriptions 579 494
Advertising and other 434 745
------ ------
Total revenues 4,283 1,878

Cost of revenues: 1,401 716
------ ------
Gross profit 2,882 1,162

Operating expenses:
Sales and marketing 607 1,367
Development expenses 623 556
General and administrative 2,122 1,468
Depreciation and
amortization 1,165 703
------ ------
4,517 4,094

Loss from operations (1,635) (2,932)

Interest and other income
(expense), net (71) 335
------ ------
Loss before income taxes (1,706) (2,597)

Income tax provision -- --
------ ------
Net loss ($1,706) ($2,597)
====== ======

Basic and diluted weighted
average shares outstanding 14,909 12,458
Basic and diluted net loss per share ($0.11) ($0.21)

See accompanying notes to consolidated financial statements

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EDGAR ONLINE, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
(UNAUDITED)

Three Months Ended
March 31,
2001 2000
------ ------

Cash flows from operating activities:
Net loss ($1,706) ($2,597)
Adjustments to reconcile net loss to net cash used in operating
activities:
Depreciation 326 199
Amortization of intangibles 839 504
Change in allowance for doubtful accounts (89) (2)
Stock compensation expense 3 3
Changes in assets and liabilities:
Accounts receivable 535 (307)
Other assets (118) (394)
Accounts payable and accrued expenses (229) 342
Deferred revenues (146) 250
------ ------
Total adjustments 1,121 595
------ ------
Net cash (used in) operating activities (585) (2,002)

Cash used in investing activities:
Purchases of property and equipment (218) (497)
Purchase of other investments -- (110)
Purchases of available-for-sale investments -- (83)
------ ------
Net cash (used in) investing activities (218) (690)

Cash flows from financing activities:
Proceeds from issuances of common stock -- 1
Principal payments on notes payable (33) --
Payments on capital lease obligations (25) (19)
------ ------
Net cash (used in) financing activities (58) (18)
------ ------
Net change in cash and cash equivalents (861) (2,710)
Cash and cash equivalents at beginning of period 2,284 10,109
------ ------
Cash and cash equivalents at end of period $1,423 $7,399
====== ======

Supplemental disclosure of cash flow information:
Cash paid for interest and taxes $202 $4

See accompanying notes to consolidated financial statements

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EDGAR ONLINE, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

(1) BASIS OF PRESENTATION

EDGAR Online, Inc. ("the Company"), formerly Cybernet Data Systems, Inc.,
was incorporated in the State of Delaware in November 1995, and launched its
"EDGAR-Online" Internet Web site in January 1996. The Company is a global
business-to-business and Web-based provider of business, financial and
competitive information derived from U.S. Securities and Exchange Commission
data and a developer of Internet-based financial and business system solutions.

In May 1999, the Company completed an initial public offering ("IPO") of
3,600,000 shares of the Company's common stock resulting in net proceeds of
approximately $30.4 million.

On September 10, 1999, we acquired Partes Corporation ("Partes"), owner of
the FreeEDGAR.com Web site. Under the terms of the agreement, we purchased all
of the outstanding equity of Partes for $9,901,054. The purchase price included
(1) the issuance of 908,877 shares of EDGAR Online common stock valued at
$7,804,981, (2) the issuance of 75,039 EDGAR Online stock options and warrants,
with a fair value of $259,176, in exchange for all outstanding Partes stock
options, (3) the assumption of net liabilities totaling $847,786 and (4)
$989,111 in fees and acquisition related expenses. Subsequent to the
acquisition, we also repaid Partes bank indebtedness of $919,879. The
acquisition was accounted for under the purchase method of accounting and
accordingly the estimated fair value of Partes' assets and liabilities and the
operating results of Partes from the effective date of the acquisition have been
included in the accompanying financial statements. During the fourth quarter of
2000, we performed a reassessment of the recovery of the goodwill and other
long-lived assets related to Partes and as a result recorded an impairment
charge of $5,673,000.

On October 30, 2000, the Company acquired all the outstanding equity of
Financial Insight Systems, Inc. (FIS), pursuant to the terms and conditions of
an agreement and plan of merger dated October 18, 2000 for approximately $27.9
million. The purchase price included (1) the issuance of 2,450,000 restricted
shares of EDGAR Online common stock valued at approximately $9.6 million, (2)
the payment of $17,765,000 consisting of (i) a cash payment of $11,765,000 and
(ii) a series of two year 7.5% senior subordinated secured promissory notes in
the total principal amount of $6,000,000 and (3) approximately $0.6 million in
cash for the payment of fees and acquisition related expenses. The acquisition
was accounted for under the purchase method of accounting and accordingly the
estimated fair value of FIS' assets and liabilities and the operating results of
FIS from the effective date of the acquisition have been included in the
accompanying financial statements. The Company is in the process of finalizing
valuations that will be used in the assignment of the FIS excess purchase price
to certain intangible assets acquired and to goodwill. At March 31, 2001, this
valuation was not completed, and the entire FIS excess purchase price has been
included within intangible assets in the accompanying balance sheet. The asset
is being amortized using a useful life of ten years, the estimated blended
useful life of the excess purchase price.

These financial statements should be read in conjunction with the financial
statements and related footnotes included in the Company's Form 10-K, filed with
the SEC in March 2001.

The Company has a limited operating history and its prospects are subject
to the risks, expenses and uncertainties frequently encountered by companies in
the new and rapidly evolving markets for Internet products and services. These
risks include general economic and business conditions (including in the online
business and financial information industry), actions of our competitors, the
extent to which we are able to develop new services and markets for our
services, the time and expense involved in such development activities, the
level of demand and market acceptance of our services and changes in our
business strategies. Inherent in the Company's mission are various risks and
uncertainties, including its limited operating history, unproven business model
and the limited history of commerce on the Internet. The Company's success may
depend in part upon the emergence and acceptance of the Internet as a
communication and information medium, prospective project development efforts
and the acceptance by the market place of the Company's products and services.

(2) UNAUDITED INTERIM FINANCIAL INFORMATION

The unaudited interim financial statements of the Company as of March 31,
2001 and for the three months ended March 31, 2001 and 2000, included herein
have been prepared in accordance with the instructions for Form 10-Q under the
Securities Exchange Act of 1934, as amended, and Article 10 of Regulation S-X
under the Securities Act of 1933, as amended. Certain information and footnote
disclosures normally included in financial statements prepared in accordance
with accounting principles generally accepted in the United States of America
have been condensed or omitted pursuant to such rules and regulations relating
to interim financial statements.

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In the opinion of management, the accompanying unaudited interim financial
statements reflect all adjustments, consisting only of normal recurring
adjustments, necessary to present fairly the financial position of the Company
as of March 31, 2001, and the results of its operations and its cash flows for
the three months ended March 31, 2001 and 2000, respectively. The results for
the three months ended March 31, 2001 are not necessarily indicative of the
expected results for the full fiscal year or any future period.

Stock compensation expense has been reported within the functional expense
category for which the employee worked. Prior comparative amounts have been
reclassified to conform to the year 2001 presentation.

Revenue for the three months ended March 31, 2000 has been restated by
reducing corporate contract revenue as compared to amounts previously reported
in the Company's Form 10-Q to reflect the retroactive application of SAB 101 as
of January 1, 2000. The reduction in revenue relates to the deferral of revenue
associated with certain up front fees.

The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements, and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.

(3) LOSS PER SHARE

Loss per share is presented in accordance with the provisions of Statement
of Financial Accounting Standards (SFAS) No. 128, "Earnings Per Share". Under
SFAS No. 128, basic earnings per share ("EPS") excludes dilution for common
stock equivalents and is computed by dividing income or loss available to common
shareholders by the weighted average number of common shares outstanding for the
period. Diluted EPS reflects the potential dilution that could occur if
securities or other contracts to issue common stock were exercised or converted
and resulted in the issuance of common stock.

Diluted loss per share has not been presented separately, as the
outstanding stock options and warrants are anti-dilutive for each of the periods
presented.

Anti-dilutive potential common shares outstanding were 357,930 and 794,003
for the three months ended March 31, 2001 and 2000, respectively.

(4) STOCKHOLDERS' EQUITY

COMMON AND PREFERRED STOCK

On March 25, 1999, the Board of Directors of the Company declared and
approved an increase in the number of authorized shares of common stock to
30,000,000, par value $0.01 per share, and authorized 1,000,000 shares of
preferred stock, par value $0.01 per share. There were no preferred shares
issued or outstanding at March 31, 2001.

On March 30, 1999, the Company completed the sale of an aggregate of
240,000 shares of its common stock to three investors at $4.50 per share
resulting in net proceeds of $1,055,250.

On May 26, 1999, the Company sold 3,600,000 shares of its common stock to
the public at $9.50 per share for net proceeds of approximately $30.4 million.
In connection with this offering, the Company, its underwriters and the holder
of a certain convertible debenture agreed that such holder would convert the
convertible debenture into 670,000 shares of the Company's common stock prior to
the close of the Company's IPO. In addition, certain holders of warrants to
purchase Company common stock also agreed to exercise the warrants into an
aggregate of 696,667 shares of common stock prior to the close of the IPO.

(5) COMPREHENSIVE INCOME

The Company adopted the provisions of SFAS No. 130, "Reporting
Comprehensive Income" during 1998. SFAS No. 130 requires the Company to report
in its financial statements, in addition to its net income (loss), comprehensive
income (loss), which includes all changes in equity during a period from
non-owner sources including, as applicable, foreign currency items, minimum

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pension liability adjustments and unrealized gains and losses on certain
investments in debt and equity securities. There were no significant differences
between the Company's comprehensive loss and its net loss as reported for any of
the periods presented.

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

The following discussion of the financial condition and results of
operations of the Company contains forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. The Company's actual results and timing of certain events
could differ materially from those anticipated in these forward- looking
statements as a result of certain factors, including, but not limited to, those
set forth under "Risk Factors that May Affect Future Results" included elsewhere
in this Quarterly Report.

OVERVIEW

EDGAR Online is a global business-to-business and Web-based provider of
business, financial and competitive information derived from U.S. Securities and
Exchange Commission data and a developer of Internet-based financial and
business system solutions. We sell to the corporate market and Internet portals
as well as running five destination Web sites. We were founded in November 1995
as Cybernet Data Systems, Inc. In January 1999, we changed our corporate name to
EDGAR Online, Inc.

We had no revenue in 1995. Our primary activities in 1995 related to
beginning development of our proprietary systems. In January 1996, we launched
our Web site and began selling our subscription services and establishing
contractual relationships with large Web portal and business and financial
information sites to supply EDGAR content for display on these sites. We started
selling advertising banners and sponsorships on our site in February 1997.

We derive revenues from three primary sources: corporate contracts,
individual subscriptions, and advertising. Revenue from corporate contracts
consists of sales of data and information systems to corporate customers and is
recognized over the term of the contract. Services related to corporate
contracts are typically billed either monthly or quarterly in advance. Revenue
from individual subscriptions is deferred and recognized as income over the
subscription period. Individual subscriptions are typically billed in advance to
subscribers' credit cards and are collected, net of credit card transaction fees
deducted by the credit card processing institution, within one week of the sale.
Revenue from advertising is recognized as the services are provided. Advertising
revenue is paid to us by DoubleClick, net of advertising placed and commission
fees. Barter advertising revenue is a non-cash item and relates to advertising
placed on our Web sites by other Internet companies in exchange for our
advertising placed on their Web sites. Barter advertising revenue is recorded
in the month that banners are exchanged. The amount of barter advertising
revenue and expense is recorded at the fair market value of the services
received or provided, whichever is more objectively determinable.

We intend to increase our operating expenses to fund increased sales and
marketing efforts, to enhance our Web sites and to continue to establish
relationships critical to our success.

In May 1999, we sold 3,600,000 shares of our common stock at a price of
$9.50 per share resulting in net proceeds of approximately $30.4 million. After
the application of a portion of the proceeds as described in our prospectus, we
have continued to fund our sales, product development and general and
administrative expenses and in 1999 and 2000 we used approximately $14 million
in connection with the acquisitions of Financial Insight Systems, Inc., Partes
Corporation and various other strategic assets.

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accordingly the estimated fair value of Partes' assets and liabilities and the
operating results of Partes from the effective date of the acquisition have been
included in the accompanying financial statements. During the fourth quarter of
2000, we performed a reassessment of the recovery of the goodwill and other
long-lived assets related to Partes and as a result recorded an impairment
charge of $5,673,000.

RESULTS OF OPERATIONS

Revenues

Revenues increased 128% to approximately $4.3 million in the three-month
period ended March 31, 2001, from $1.9 million for the comparable period in
2000. The growth in revenues is primarily attributable to a $2.6 million, or
412% increase in corporate contract revenues and a $85,000 or 17% increase in
individual subscription revenues offset by a $311,000 or 42% decrease in
advertising and other revenues. The increase in corporate contract revenue
resulted primarily from the FIS acquisition as well as an increase in the number
of corporate contracts in excess of $500 per month from approximately 59 at
March 31, 2000 to approximately 115 at March 31, 2001. The number of individual
subscriptions increased from approximately 15,200 subscriptions at March 31,
2000 to approximately 16,300 subscriptions at March 31, 2001. The decrease in
advertising and other revenues is primarily due to the decrease in the
advertising rates as impressions for the quarter increased from 90 million for
the quarter ended March 31, 2000 to 105 million for the quarter ended March 31,
2001.

Cost of Revenues

Cost of revenues consist primarily of fees paid to acquire the Level I
EDGAR database feed from the SEC, Web site maintenance charges, salaries and
benefits of certain employees, and the costs associated with our computer
equipment and communications lines used in conjunction with our Web sites. In
addition, for each period, online barter advertising expense is recorded equal
to the online barter advertising revenue for that period. Total cost of revenues
increased 96% to $1.4 million in the three-month period ended March 31, 2001,
from $716,000 for the comparable period in 2000. The increase in cost of
revenues is primarily attributable to the FIS acquisition and increases in
software and Web site maintenance and communications lines needed to handle
increased traffic. Gross margins were 67% in the three-month period ended March
31, 2001 and 62% for the comparable period in 2000.

Operating Expenses

Sales and Marketing. Sales and marketing expenses consist primarily of
salaries and benefits, advertising expenses, public relations, and costs of
marketing materials. Sales and marketing expenses decreased 56% to $607,000 in
the three months ended March 31, 2001 from $1.4 million in the equivalent period
in 2000. The decrease in sales and marketing expenses in dollar terms in the
three months ended March 31, 2001 was due to a reduction in our advertising
spending and marketing campaign. As a percentage of revenues, sales and
marketing expenses decreased to 14% in the three months ended March 31, 2001
from 73% for the comparable period in 2000 primarily due to the addition of
revenue from FIS which has a smaller percentage of revenue dedicated to sales
and marketing as compared to our subscription business. We expect sales and
marketing expenses to increase as we continue to hire additional sales
personnel.

Development. Development expenses increased 12% to $623,000 for the three
months ended March 31, 2001 from $556,000 in the comparable period of 2000. The
increase in development expenses in dollar terms is primarily due to the
expansion of content on our Web sites and development of corporate products. As
a percentage of revenues, development expenses decreased to 15% in the three
months ended March 31, 2001 from 30% for the comparable period in 2000. The
decrease as a percent of revenues is the result of the addition of revenue from
FIS which has a smaller percentage of revenue dedicated to development as
compared to our subscription business.

General and Administrative. General and administrative expenses consist
primarily of salaries and benefits, fees for professional services, general
corporate expenses and facility expenses. General and administrative expenses
increased 45% to $2.1 million in the three months ended March 31, 2001 from $1.5
million for the comparable period in 2000.

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The increase in general and administrative expenses in dollar terms in the three
months ended March 31, 2001 was primarily due to the FIS acquisition and
increased personnel, professional service fees and general corporate expenses.
As a percentage of revenues, general and administrative expenses decreased to
50% in the three months ended March 31, 2001 from 78% for the comparable period
in 2000. The decrease in general and administrative expenses as a percentage of
revenue is due to the addition of FIS revenue which has a smaller percentage of
revenue dedicated to general and administrative as compared to our subscription
business. We expect that general and administrative expenses will continue to
increase in future periods as we hire additional personnel and incur additional
costs related to the growth of our business and our operations as a public
company.

Depreciation and Amortization. Depreciation and amortization expenses
include the depreciation of property and equipment and the amortization of
intangible assets. Depreciation and amortization increased 66% to $1.2 million
for the quarter ended March 31, 2001 from $703,000 for the quarter ended March
31, 2000. The increase in depreciation and amortization is due to the additional
amortization expense related to the FIS acquisitions and the increase in
property and equipment.

LIQUIDITY AND CAPITAL RESOURCES

Net cash used in operating activities was $585,000 and $2.0 million for the
three months ended March 31, 2001 and 2000, respectively. We have historically
financed these activities through private debt placements and the sale of equity
instruments to investors. In connection with our acquisition of FIS, our
continued focus on growing our corporate customer base, and recent expense
reductions, we expect to be cash flow positive by the third quarter of 2001;
although no assurance can be given in this regard. In addition, we expect to
receive approximately $1 million in tax refunds during the second quarter of
2001 as a result of tax loss carrybacks available as a result of our acquisition
of FIS.

Capital expenditures, primarily for computers, office and communications
equipment, totaled $218,000 for the three months ended March 31, 2001 and
$497,000 for the three months ended March 31, 2000. The purchases were required
to support our expansion and increased infrastructure.

At March 31, 2001, we had cash and cash equivalents on hand of $1.4 million
and marketable securities of $1.5 million. We believe that our existing capital
resources, cash generated from operations, and the tax refund referred to above
will be sufficient to meet our anticipated cash needs for working capital and
capital expenditures for at least the next 12 months. Thereafter, if cash
generated from operations is insufficient to satisfy our liquidity requirements,
we may need to raise additional funds through public or private financings,
strategic relationships or other arrangements to fund more and rapid expansion,
to develop new or enhance existing services, or to respond to competitive
pressures. There can be no assurance that such additional funding, if needed,
will be available on terms attractive to us, or at all. The failure to raise
capital when needed could materially adversely affect our business, results of
operations and financial condition. If additional funds are raised through the
issuance of equity securities, the percentage ownership of our then-current
stockholders would be reduced.

In connection with our acquisition of FIS, we issued $6,000,000 in notes
with all principal due October 27, 2002. We expect that our cash generated from
operations will be sufficient to pay the debt upon maturity. If cash generated
from operations is insufficient to satisfy the debt repayment, we may need to
raise additional funds through public or private financings, strategic
relationships or other arrangements. There can be no assurance that such
additional funding, if needed, will be available on terms attractive to us, or
at all. The failure to raise capital when needed could materially adversely
effect our business, results of operations and financial condition. If
additional funds are raised through the issuance of equity securities, the
percentage ownership of our then-current stockholders would be reduced.

RISK FACTORS THAT MAY AFFECT FUTURE RESULTS AND FINANCIAL CONDITION

WE HAVE A LIMITED OPERATING HISTORY AND OUR FUTURE SUCCESS WILL DEPEND ON OUR
ABILITY TO INCREASE REVENUES.

As an early stage company in the new and rapidly evolving market for the
delivery of financial and business information over the Internet, we face
numerous risks and uncertainties in achieving increased revenues. We were
incorporated in November 1995 and launched our EDGAR Online Web site in January
1996. Accordingly, we have a limited operating history on which you can evaluate
our business and prospects. During this period, we have invested heavily in our
proprietary technologies to enable us to

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carry out our business plan. These expenditures, in advance of revenues, have
resulted in operating losses in each of the last three years. In order to be
successful, we must increase our revenues from the sale of our services to
corporate customers, individual subscription fees and advertising sales. In
order to increase our revenues, we must successfully:

- implement our marketing plan to (1) increase corporate sales, (2)
attract more individual online users to our services and (3) convert
visitors to paying subscribers;

- continue to improve our market position as a commercial provider of
information services based on EDGAR filings;

- maintain our current, and develop new, content distribution
relationships with popular Web sites and providers of business and
financial information;

- maintain our current, and continue to increase, advertising revenues
by increasing traffic to our Web sites and by increasing the number of
advertisers;

- respond effectively to competitive pressures from other Internet
providers of EDGAR content;

- continue to develop and upgrade our technology;

- integrate our acquisition of Financial Information Systems, Inc.; and

- attract, retain and motivate qualified personnel with Internet
experience to serve in various capacities, including IT services,
sales and marketing positions.

If we are not successful in addressing these uncertainties through the
execution of our business strategy, our business, results of operations and
financial condition will be materially adversely affected.

WE HAVE A HISTORY OF LOSSES AND CANNOT ASSURE THAT WE WILL ATTAIN PROFITABILITY.

As of March 31, 2001, we had an accumulated deficit of $25,852,635. We
incurred net losses of $2,221,474 for the year ended December 31, 1998,
$4,162,861 for the year ended December 31, 1999, $15,237,305 for the year ended
December 31, 2000 and $1,706,008 for the three months ended March 31, 2001. We
expect to continue to incur significant operating costs and capital
expenditures. As a result, we will need to generate significant additional
revenues to achieve and maintain profitability. Even if we do achieve
profitability, we cannot assure you that we can sustain or increase
profitability on a quarterly or annual basis in the future. In addition, if
revenues grow slower than we anticipate, or if operating expenses exceed our
expectations or cannot be adjusted accordingly, our business, results of
operations and financial condition will be materially adversely affected. As a
result of these and other costs, we may incur operating losses in the future,
and we cannot assure you that we will attain profitability.

WE MAY NOT BE ABLE TO OBTAIN ADDITIONAL FINANCING.

We currently anticipate that our available cash resources combined with
cash generated from operations will be sufficient to meet our anticipated
working capital and capital expenditure requirements for at least the next 12
months. We may need to raise additional funds, however, to fund potential
acquisitions, more rapid expansion, to develop new or enhance existing services,
or to respond to competitive pressures. We cannot assure you that additional
financing will be available on terms favorable to us, or at all. If adequate
funds are not available or are not available on acceptable terms, our ability to
fund our expansion, take advantage of unanticipated opportunities, develop or
enhance services or products or otherwise respond to competitive pressures would
be significantly limited. Our business, results of operations and financial
condition could be materially adversely affected by these financing limitations.

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FUTURE ENHANCEMENTS TO THE SEC'S EDGAR SYSTEM MAY ERODE DEMAND FOR OUR SERVICES.

Our future success will depend on our ability to continue to provide
value-added services that distinguish our Web sites from the type of
EDGAR-information available from the SEC on its Web site. Through its Web site,
the SEC provides free access to EDGAR filings on a time-delayed basis of 24 to
72 hours. If the SEC, which has announced that it intends to modernize the EDGAR
system, were to make changes to its Web site such as providing (1) free
real-time access to EDGAR filings or (2) value-added services comparable to
those provided on our Web sites, our business, results of operations and
financial condition would be materially adversely affected.

WE FACE INTENSE COMPETITION FROM OTHER PROVIDERS OF BUSINESS AND FINANCIAL
INFORMATION.

We compete with many providers of business and financial information,
including other Internet companies, for consumers' and advertisers' attention
and spending. Because our market poses no substantial barriers to entry, we
expect this competition to continue to intensify. The types of companies with
which we compete for users and advertisers include:

- traditional vendors of financial information, such as Disclosure;

- proprietary information services and Web sites targeted to business,
finance and investing needs, including those providing EDGAR content,
such as Bloomberg, and LIVEDGAR; and

- Web-based providers of free EDGAR information such as 10K Wizard.com.

Our future success will depend on our ability to maintain and enhance our
market position by: (1) using technology to add value to raw EDGAR information,
(2) keeping our pricing models below those of our competitors, (3) maintaining a
strong corporate sales presence in the marketplace and (4) signing high-traffic
Web sites to distribution contracts.

Our potential commercial competitors include entities that currently
license our content, but which may elect to purchase a real-time EDGAR database
feed (called a Level I EDGAR feed) directly from the SEC and use it to create
value-added services, similar to services provided by us, for their own use or
for sale to others. This risk is particularly serious in light of the fact that
the cost of Level I feed has fallen significantly since we started our business.
The cost of the feed is now approximately $45,000 per year.

Many of our existing competitors, as well as a number of potential
competitors, have longer operating histories, greater name recognition, larger
customer bases and significantly greater financial, technical and marketing
resources than we do. This may enable them to respond more quickly to new or
emerging technologies and changes in the types of services sought by users of
EDGAR-based information, or to devote greater resources to the development,
promotion and sale of their services than we can. These competitors and
potential competitors may be able to undertake more extensive marketing
campaigns, adopt more aggressive pricing policies and make more attractive
offers to potential employees, subscribers and content distribution partners.
Our competitors may also develop services that are equal or superior to the
services offered by us or that achieve greater market acceptance than our
services. In addition, current and prospective competitors may establish
cooperative relationships among themselves or with third parties to improve
their ability to address the needs of our existing and prospective customers. If
these events occur, they could have a materially adverse effect on our revenue.
Increased competition could also result in price reductions, reduced margins or
loss of market share, any of which would adversely affect our business, results
of operations and financial condition.

WE RISK BEING DELISTED FROM NASDAQ WHICH COULD REDUCE OUR ABILITY TO RAISE FUNDS

If our stock price were to drop below $1.00 per share and remain below
$1.00 per share for an extended period of time, we would be in violation the
continued listing requirements of The Nasdaq Stock Market ("Nasdaq") and we risk
the delisting of our shares from Nasdaq. Delisting from Nasdaq and inclusion of
our common stock on the OTC Bulletin Board or similar quotation system could
adversely affect the liquidity and price of our common stock and make it more
difficult for us to raise additional capital on favorable terms, if at all.

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Even if the minimum per share bid price of our common stock is maintained,
the Company must also satisfy other listing requirements of the Nasdaq National
Market ("NNM"), such as maintaining net tangible assets of at least $4 million.
Failure to satisfy any of the maintenance requirements could result in our
common stock being delisted from the NNM. Although in that event we could apply
to list our shares with the Nasdaq SmallCap Market, its delisting from the NNM
could adversely affect the liquidity of our common stock. In addition, delisting
from the NNM might negatively impact the Company's reputation and, as a
consequence, its business.

THE PRICE OF OUR COMMON STOCK HAS BEEN VOLATILE.

The market price of our common stock has been, and is likely to continue to
be, volatile, experiencing wide fluctuations. In recent years, the stock market
has experienced significant price and volume fluctuations that have particularly
affected the market prices of equity securities of many technology companies.
Some of these fluctuations appear to be unrelated or disproportionate to the
operating performance of such companies. Future market movements may materially
and adversely affect the market price of our common stock.

WE MAY NOT BE SUCCESSFUL IN INCREASING BRAND AWARENESS.

Our future success will depend, in part, on our ability to increase the
brand awareness of our Web-based customized corporate services. If our marketing
efforts are unsuccessful or if we cannot increase our brand awareness, our
business, financial condition and results of operations would be materially
adversely affected. In order to build our brand awareness, we must succeed in
our marketing efforts, provide high quality services and increase the number of
people who are aware of the services we offer. We have devoted significant funds
to expand our sales and marketing efforts as part of our brand-building efforts.
These efforts may not be successful.

WE MAY NOT BE SUCCESSFUL IN DEVELOPING NEW AND ENHANCED SERVICES AND FEATURES
FOR OUR WEB SITES.

Our market is characterized by rapidly changing technologies, evolving
industry standards, frequent new product and service introductions and changing
customer demands. To be successful, we must adapt to our rapidly changing market
by continually enhancing our existing services and adding new services to
address our customers' changing demands. We could incur substantial costs if we
need to modify our services or infrastructure to adapt to these changes. Our
business could be adversely affected if we were to incur significant costs
without generating related revenues or if we cannot adapt rapidly to these
changes.

Our business could also be adversely affected if we experience difficulties
in introducing new or enhanced services or if these services are not favorably
received by users. We may experience technical or other difficulties that could
delay or prevent us from introducing new or enhanced services. Furthermore,
after these services are introduced, we may discover errors in these services
which may require us to significantly modify our software or hardware
infrastructure to correct these errors.

WE ARE DEPENDENT ON THE CONTINUED GROWTH OF THE EMERGING MARKET FOR ONLINE
BUSINESS AND FINANCIAL INFORMATION.

The success of our business will depend on the growing use of the Internet
for the dissemination of business and financial information. The number of
individuals and institutions that use the Internet as a primary source of
business and financial information may not continue to grow. The market for the
distribution of business and financial information, including EDGAR-based
content, over the Internet has only recently begun to develop, is rapidly
evolving and is characterized by an increasing number of market entrants who
have introduced or developed electronic distribution services over the Internet
and private networks. As is typical of a rapidly evolving industry, demand and
market acceptance for new services are subject to a high level of uncertainty.

Because the market for our products and services is new and rapidly
evolving, it is difficult to predict with any certainty what the growth rate, if
any, and the ultimate size of this market will be. We cannot be certain that the
market for our services will continue to develop or that our services will ever
achieve a significant level of market acceptance. If the market fails to
continue to develop, develops more slowly than expected or becomes saturated
with competitors, or if our services do not achieve significant market
acceptance, or if pricing becomes subject to considerable competitive pressures,
our business, results of operations and financial condition would be materially
adversely affected.

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MAINTAINING EXISTING AND ESTABLISHING NEW CONTENT DISTRIBUTION RELATIONSHIPS
WITH HIGH-TRAFFIC WEB SITES IS CRUCIAL TO OUR FUTURE SUCCESS.

Because our advertising revenues depend to a great extent on the traffic to
our Web sites, our business could be adversely affected if we do not maintain
our current, and establish additional, content distribution relationships on
commercially reasonable terms or if a significant number of our content
distribution relationships do not result in increased use of our Web sites. We
rely on establishing and maintaining content distribution relationships with
high-traffic Web sites for a significant portion of the traffic on our Web
sites. There is intense competition for placements on high-traffic Web sites,
and we may not be able to maintain our present contractual relationships or
enter into any additional relationships on commercially reasonable terms, if at
all. Even if we maintain our existing relationships or enter into new content
distribution relationships with other Web sites, they themselves may not
continue to attract significant numbers of users. Therefore, our Web sites may
not continue to receive significant traffic or receive additional new users from
these relationships.

OUR BUSINESS COULD BE ADVERSELY AFFECTED BY A DOWNTURN IN THE FINANCIAL SERVICES
INDUSTRY.

We are dependent upon the continued demand for the distribution of business
and financial information over the Internet, making our business susceptible to
a downturn in the financial services industry. For example, a decrease in the
expenditures that corporations and individuals are willing to make to purchase
these types of information could result in a decrease in the number of customers
purchasing our information services and subscribers utilizing our Web sites.
This downturn could have a material adverse effect on our business, results of
operations and financial condition.

SOME OF OUR CLIENTS MAY BE UNABLE TO RAISE ADDITIONAL CAPITAL NEEDED TO RETAIN
OUR SERVICE OR PAY US FOR SERVICES PERFORMED.

Some of our current and potential clients need to raise additional funds in
order to continue their business and operations as planned. We cannot be certain
that these companies will be able to obtain additional financing on favorable
terms or at all. As a result of their inability to raise additional financing,
some clients may be unable to pay us for services we have already provided them
or they may terminate our services earlier than planned, either of which could
have a material adverse effect on our business, financial condition and
operating results.

WE DEPEND ON DOUBLECLICK FOR ADVERTISING REVENUES.

We anticipate that our results of operations in any given period will
continue to depend to a significant extent upon advertising revenues generated
through our relationship with DoubleClick, Inc., which has provided us with a
full range of advertising services for the last three years. DoubleClick's
failure to enter into a sufficient number of advertising contracts during a
particular period could have a material adverse effect on our business,
financial condition and results of operations. Historically, a limited number of
customers, all represented by DoubleClick, have accounted for a significant
percentage of our paid advertising revenues. For the quarter ended March 31,
2001, our DoubleClick-related paid advertising revenue was 6% of our total
revenues.

Our existing agreement with DoubleClick can be canceled by either party on
90 days notice. In addition, this agreement does not prohibit DoubleClick from
selling the same type of service that we currently receive from them to Web
sites that compete with our Web sites. If DoubleClick is unable or unwilling to
provide these advertising services to us in the future, we would be required to
obtain them from another provider or perform them ourselves. We would likely
lose significant advertising revenues while we are in the process of replacing
DoubleClick's services.

WE FACE INTENSE COMPETITION FOR ADVERTISING REVENUES AND THE VIABILITY OF THE
INTERNET AS AN ADVERTISING MEDIUM IS UNCERTAIN.

We compete with both traditional advertising media, such as print, radio
and television, and other Web sites for a share of advertisers' total
advertising budgets. Paid advertising revenues represented 6% and 32% of our
total revenues for the quarters ended March 31, 2001 and March 31, 2000,
respectively. If advertisers do not perceive the Internet to be an effective
advertising medium, companies like ours will be unable to compete successfully
with traditional media for advertising revenues. In addition, if we are unable
to generate sufficient traffic on our Web sites, we could potentially lose
advertising revenues to other Web sites that generate higher user traffic. If
advertising on the Web shrinks due to a general business downturn, this could
also cause us to lose advertising revenue. Because advertising sales make up a
significant component of our revenues, any of these developments could have a
significant adverse impact on our business, results of operations or financial
condition.

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WE MAY NOT BE ABLE TO CREATE AND DEVELOP AN EFFECTIVE DIRECT SALES FORCE.

Because a significant component of our growth strategy relates to
increasing our revenues from sales of our corporate services, our business would
be adversely affected if we were unable to develop and maintain an effective
sales force to market our services to this customer group. Until mid-1999, we
had not employed any sales executives to sell our corporate services. Our sales
force now consists of 12 people. Six of these people were added during the
quarter ended March 31, 2001. Nine of our sales people have been hired from
outside the company. Three of our sales people have been reassigned from other
duties within the company. Our efforts to build an effective sales force may not
be successful.

WE MAY NOT BE ABLE TO SUCCESSFULLY MANAGE OUR GROWTH.

We have experienced and are currently experiencing a period of significant
growth. If we are unable to manage our growth effectively, our business will be
adversely affected. This growth has placed, and our anticipated future growth
will continue to place, a significant strain on our technical, financial and
managerial resources. As part of this growth, we may have to implement new
operational and financial systems and procedures and controls to expand, train
and manage our employees, especially in the areas of sales and product
development.

WE FACE RISKS IN CONNECTION WITH OUR RECENT ACQUISITION AND OTHER ACQUISITIONS
AND BUSINESS COMBINATIONS THAT WE MAY CONSUMMATE.

We plan to continue to expand our operations and market presence by making
acquisitions, such as the recent acquisition of Financial Insight Systems, Inc.
and entering into business combinations, investments, joint ventures or other
strategic alliances with other companies. These transactions create risks such
as:

- difficulty assimilating the operations, technology and personnel of
the combined companies;

- disruption of our ongoing business;

- problems retaining key technical and managerial personnel;

- expenses associated with amortization of goodwill and other purchased
intangible assets;

- additional operating losses and expenses of acquired businesses; and

- impairment of relationships with existing employees, customers and
business partners.

We may not succeed in addressing these risks. In addition, some of the
businesses we have acquired, and in the future may acquire, may continue to
incur operating losses.

WE DEPEND ON KEY PERSONNEL.

Our future success will depend to a significant extent on the continued
services of our senior management and other key personnel, particularly Susan
Strausberg, Chief Executive Officer, Marc Strausberg, Chairman and Chief
Information Officer, Albert E. Girod, Executive Vice President and Chief
Technology Officer, Tom Vos, President and Chief Operating Officer, Greg Adams,
Chief Financial Officer and Jay Sears, Senior Vice President, Strategy and
Business Development, each of whom are parties to written employment agreements.
The loss of the services of these, or certain other key employees, would likely
have a material adverse effect on our business. We do not maintain "key person"
life insurance for any of our personnel. Our future success will also depend on
our continuing to attract, retain and motivate other highly skilled employees.
Competition for personnel in our industry is intense. We may not be able to
retain our key employees or attract, assimilate or retain other highly qualified
employees in the future. If we do not succeed in attracting new personnel or
retaining and motivating our current personnel, our business will be adversely
affected. In addition, the employment agreements with our key employees contain
restrictive covenants that restrict their ability to compete against us or
solicit our customers. These restrictive covenants, or some portion of these
restrictive covenants, may be deemed to be against public policy and may not be
fully enforceable. If these provisions are not enforceable, these employees may
be in a position to leave us and work for our competitors or start their own
competing businesses.

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WE MAY NOT ADEQUATELY PERFORM CERTAIN ASPECTS OF OUR BUSINESS WHICH WERE
PREVIOUSLY PROVIDED BY THIRD PARTIES.

Until February 2001, we depended on third parties to develop and maintain
the software and hardware we use to operate a number of our Web sites. Prior to
this date, iXL Enterprises, Inc., an Internet strategy consulting company,
developed, maintained and upgraded our proprietary software, including those
features which enable users to locate and retrieve data, as well as one of our
databases of EDGAR filings, Web-based customer interfaces and customer support
and billing systems. Beginning in December 2000, we started to assume full
responsibility from iXL for the development and maintenance of our own software
and hardware configurations. As of the end of February 2001, we have become
solely responsible for these functions. If we are unable to perform these
services as well as iXL did previously, this could materially adversely affect
our business, results of operations and financial condition.

WE DEPEND ON THIRD PARTIES FOR IMPORTANT ASPECTS OF OUR BUSINESS OPERATIONS.

We have a hosting contract with Globix Corporation, a provider of Internet
services, pursuant to which Globix operates and maintains the Web servers owned
by us in their New York City data center. Our hosting contract with Globix
expires in July 2003. If Globix were unable or unwilling to provide these
services, we would have to find a suitable replacement. Our operations could be
disrupted while we were in the process of finding a replacement for Globix and
the failure to find a suitable replacement or to reach an agreement with an
alternate provider on terms acceptable to us could materially adversely affect
our business, results of operations and financial condition.

WE FACE A RISK OF SYSTEM FAILURE.

Our ability to provide EDGAR content on a real-time basis and
technology-based solutions to our corporate clients depends on the efficient and
uninterrupted operation of our computer and communications hardware and software
systems. Similarly, our ability to track, measure and report the delivery of
advertisements on our site depends on the efficient and uninterrupted operation
of a third-party system provided by DoubleClick. These systems and operations
are vulnerable to damage or interruption from human error, natural disasters,
telecommunication failures, break-ins, sabotage, computer viruses, intentional
acts of vandalism and similar events. Any system failure, including network,
software or hardware failure, that causes an interruption in our service or a
decrease in responsiveness of our Web sites could result in reduced traffic,
reduced revenue and harm to our reputation, brand and relations with
advertisers.

Our operations depend on Globix's ability to protect its and our systems in
its data center against damage from fire, power loss, water damage,
telecommunications failure, vandalism and similar unexpected adverse events.
Although Globix provides comprehensive facilities management services, including
human and technical monitoring of all production servers 24 hours-per-day, seven
days-per-week, Globix does not guarantee that our Internet access will be
uninterrupted, error-free or secure. Any disruption in the Internet access to
our Web sites provided by Globix could materially adversely affect our business,
results of operations and financial condition. Our insurance policies may not
adequately compensate us for any losses that we may incur because of any
failures in our system or interruptions in the delivery of our services. Our
business, results of operations and financial condition could be materially
adversely affected by any event, damage or failure that interrupts or delays our
operations.

THERE ARE RISKS OF INCREASED USERS STRAINING OUR SYSTEMS AND OTHER SYSTEM
MALFUNCTIONS.

In the past, our Web sites and the technology-based solutions we sell to
our corporate customers have experienced significant increases in traffic when
there have been important business or financial news stories and during the
seasonal periods of peak SEC filing activity. In addition, the number of users
of our information and technology-based solutions has continued to increase over
time and we are seeking to further increase the size of our user base and the
frequency with which they use our services. Therefore, our Web sites and
business solutions must accommodate an increasingly high volume of traffic and
deliver frequently updated information. Our Web sites and business solutions
have in the past, and may in the future, experience slower response times or
other problems for a variety of reasons, including hardware capacity restraints
and software failures. These strains on our system could cause customer
dissatisfaction and could discourage visitors from becoming paying subscribers.
We also depend on the Level I EDGAR feed we purchase in order to provide SEC
filings on a real-time basis. Our Web sites could experience disruptions or
interruptions in service due to the failure or delay in the transmission or
receipt of this information.

These types of occurrences could cause users to perceive our Web sites and
technology solutions as not functioning properly and

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cause them to use other methods, including the SEC's Web site or services of our
competitors, to obtain EDGAR-based information and technology solutions.

WE LICENSE THE TERM EDGAR FROM THE SEC AND DEPEND ON OTHER INTELLECTUAL
PROPERTY.

Trademarks and other proprietary rights, principally our proprietary
database technology, are important to our success and our competitive position.
The SEC is the owner of a United States trademark registration covering the use
of the term EDGAR. We have obtained a non-exclusive, royalty-free license from
the SEC to use the term EDGAR in our trademarks, service marks and corporate
name. This license is due to expire in September 2008. Since we have built
significant brand recognition through the use of the term EDGAR in our service
offerings, company name and Web sites, our business, results of operations and
financial condition could be adversely affected if we were to lose the right to
use the term EDGAR in the conduct of our business.

We seek to protect our trademarks and other proprietary rights by entering
into confidentiality agreements with our employees, consultants and content
distribution partners, and attempting to control access to and distribution of
our proprietary information. Despite our efforts to protect our proprietary
rights from unauthorized use or disclosure, third parties may attempt to
disclose, obtain or use our proprietary information. The precautions we take may
not prevent this type of misappropriation. In addition, our proprietary rights
may not be viable or of value in the future since the validity, enforceability
and scope of protection of proprietary rights in Internet-related industries is
uncertain and still evolving.

Finally, third parties could claim that our database technology infringes
their proprietary rights. Although we have not been subjected to litigation
relating to these types of claims, such claims and any resultant litigation,
should it occur, could subject us to significant liability for damages and could
result in the invalidation of our proprietary rights. Even if we prevail, such
litigation could be time-consuming and expensive, and could result in the
diversion of our time and attention, any of which could materially adversely
affect our business, results of operations and financial condition. Any claims
or litigation could also result in limitations on our ability to use our
trademarks and other intellectual property unless we enter into license or
royalty agreements, which agreements may not be available on commercially
reasonable terms, if at all.

WE ARE DEPENDENT ON THE INTERNET INFRASTRUCTURE.

Our future success will depend, in significant part, upon the maintenance
of the various components of the Internet infrastructure, such as a reliable
backbone network with the necessary speed, data capacity and security, and the
timely development of enabling products, such as high-speed modems, which
provide reliable and timely Internet access and services. To the extent that the
Internet continues to experience increased numbers of users, frequency of use or
increased user bandwidth requirements, we cannot be sure that the Internet
infrastructure will continue to be able to support the demands placed on it or
that the performance or reliability of the Internet will not be adversely
affected. Furthermore, the Internet has experienced a variety of outages and
other delays as a result of damage to portions of its infrastructure or
otherwise, and such outages or delays could adversely affect our Web sites and
the Web sites of our co-branded partners, as well as the Internet service
providers and online service providers our customers use to access our services.
In addition, the Internet could lose its viability as a commercial medium due to
delays in the development or adoption of new standards and protocols that can
handle increased levels of activity. We cannot predict whether the
infrastructure and complementary products and services necessary to maintain the
Internet as a viable commercial medium will be developed or maintained.

WE ARE SUBJECT TO UNCERTAIN GOVERNMENT REGULATION AND OTHER LEGAL UNCERTAINTIES
RELATING TO THE INTERNET.

There are currently few laws or regulations that specifically regulate
communications or commerce on the Internet. Any new laws or regulations relating
to the Internet could adversely affect our business. In addition, current laws
and regulations may be applied and new laws and regulations may be adopted in
the future that address issues such as user privacy, pricing, taxation and the
characteristics and quality of products and services offered over the Internet.
For example, several telecommunications companies have petitioned the Federal
Communications Commission to regulate Internet service providers and online
service providers in a manner similar to long distance telephone carriers and to
impose access fees on these companies. This could increase the cost of
transmitting data over the Internet, which could increase our expenses and
discourage people from using the Internet to obtain business and financial
information. Moreover, it may take years to determine the extent to which
existing laws relating to issues such as property ownership, libel and personal
privacy are applicable to the Internet.

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WE FACE WEB SECURITY CONCERNS THAT COULD HINDER INTERNET COMMERCE.

Any well-publicized compromise of Internet security could deter more people
from using the Internet or from using it to conduct transactions that involve
transmitting confidential information, such as stock trades or purchases of
goods or services. Because a portion of our revenue is based on individuals
using credit cards to purchase subscriptions over the Internet and a portion
from advertisers who seek to encourage people to use the Internet to purchase
goods or services, our business could be adversely affected by this type of
development. We may also incur significant costs to protect against the threat
of security breaches or to alleviate problems, including potential private and
governmental legal actions, caused by such breaches.

WE COULD FACE LIABILITY AND OTHER COSTS RELATING TO OUR STORAGE AND USE OF
PERSONAL INFORMATION ABOUT OUR USERS.

Our policy is not to willfully disclose any individually identifiable
information about any user to a third party without the user's consent. This
policy statement is available to users of our subscription services when they
initially register. We also alert and seek the consent of registered subscribers
and users to use some of the information that they provide to market them
additional services provided by EDGAR Online or third party providers. Despite
this policy and consent, however, if third persons were able to penetrate our
network security or otherwise misappropriate our users' personal or credit card
information, we could be subject to liability. These could include claims for
unauthorized purchases with credit card information, impersonation or other
similar fraud claims. They could also include claims for other misuses of
personal information such as for unauthorized marketing purposes. These claims
could result in litigation. In addition, the Federal Trade Commission and
several states have been investigating certain Internet companies regarding
their use of personal information. We could incur additional expenses if new
regulations regarding the use of personal information are introduced or if these
regulators chose to investigate our privacy practices.

WE MAY BE LIABLE FOR INFORMATION DISPLAYED ON OUR WEB SITES.

We may be subjected to claims for defamation, negligence, copyright or
trademark infringement, violation of the securities laws or other claims
relating to the information that we publish on our Web sites, which may
materially adversely affect our business. These types of claims have been
brought, sometimes successfully, against online services as well as other print
publications in the past. We could also be subjected to claims based upon the
content that is accessible from our Web sites through links to other Web sites.
Our general liability insurance may not cover these claims and may not be
adequate to protect us against all liabilities that may be imposed.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

INTEREST RATE FLUCTUATIONS

We are exposed to market risk primarily through our investments in
available-for-sale investments. Our policy calls for investment in short-term,
low risk investments. As of March 31, 2001, available-for-sale investments were
$1.5 million. Due to the short-term maturity of these investments, any decrease
in interest rates would not have a material effect on our financial statements.

CURRENCY RATE FLUCTUATIONS

Our results of operations, financial position and cash flows are not
materially affected by changes in the relative values of non-U.S. currencies to
the U.S. dollar. We do not use derivative financial instruments to limit our
foreign currency risk exposure.

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PART II. OTHER INFORMATION.

ITEM 1. LEGAL PROCEEDINGS.

None

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS.

None

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

None.

ITEM 5. OTHER INFORMATION.

None.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.

a. Exhibits: There are no exhibits filed as part of this Report on Form 10-Q

b. Reports on Form 8-K: There were no reports on Form 8-K filed during the
quarter ended March 31, 2001.

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SIGNATURES

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

EDGAR ONLINE, INC.

(Registrant)

Dated: May 14, 2001 /s/ Greg D. Adams
-----------------
Greg D. Adams
Chief Financial Officer

Dated: May 14, 2001 /s/ Tom Vos
-----------
Tom Vos
President and Chief Operating Officer