Delaware		33-0442860
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification Number)

				Page
PART I.		FINANCIAL INFORMATION
Item 1.		Interim Financial Statements:
		Balance Sheets – June 30, 2002 and December 31, 2001		3
		Statements of Operations – Three and Six Months Ended June 30, 2002 and 2001		4
		Statements of Cash Flows – Six Months Ended June 30, 2002 and 2001		5
		Notes to Financial Statements		6
Item 2.		Management’s Discussion and Analysis of Financial Condition and Results of Operations		10
Item 3.		Qualitative and Quantitative Disclosures About Market Risk		23
PART II.		OTHER INFORMATION
Item 1.		Legal proceedings		24
Item 2.		Changes in securities and use of proceeds		24
Item 4.		Submission of matters to vote of security holders		24
Item 6.		Exhibits and reports on Form 8-K		24
Signatures				25

		June 30,				December 31,
		2002				2001
		(Unaudited)				*
ASSETS
Current assets:
Cash and cash equivalents		$	7,599			$	8,606
Accounts receivable, less allowance for doubtful accounts
of $328 in 2002 and $410 in 2001			4,683				4,778
Prepaid expenses and other current assets			921				1,167
Total current assets			13,203				14,551
Property and equipment, net			4,067				5,075
Other noncurrent assets			103				284
Total assets		$	17,373			$	19,910
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable		$	6,438			$	4,855
Payable to a related party			—				861
Accrued compensation and benefits			798				758
Accrued restructuring and other related charges			414				552
Other accrued liabilities			1,218				1,213
Current portion of capital lease obligations			560				713
Total current liabilities			9,428				8,952
Capital lease obligations, less current portion			92				305
Accrued restructuring and other related charges, less current portion			188				369
Stockholders’ equity:
Preferred stock, $0.001 par value:
Authorized shares — 20,000,000
Issued and outstanding – none			—				—
Common stock, $0.001 par value:
Authorized shares — 80,000,000
Issued and outstanding shares — 38,678,169 at June 30, 2002 and 38,417,625 at December 31, 2001			38				38
Additional paid-in capital			56,705				56,676
Accumulated other comprehensive income			1				45
Accumulated deficit			(49,079	)			(46,475	)
Total stockholders’ equity			7,665				10,284
Total liabilities and stockholders’ equity		$	17,373			$	19,910

		Three Months Ended June 30,								Six Months Ended June 30,
		2002				2001				2002				2001
		(Unaudited)								(Unaudited)
CRM services revenue		$	9,724			$	10,755			$	18,209			$	22,979
Cost of CRM services revenue			7,091				7,169				13,171				15,971
CRM services gross profit			2,633				3,586				5,038				7,008
Selling, general and administrative expenses			3,893				6,962				7,811				15,270
Operating loss			(1,260	)			(3,376	)			(2,773	)			(8,262	)
Interest income, net			11				94				23				305
Loss before income taxes			(1,249	)			(3,282	)			(2,750	)			(7,957	)
Income tax benefit			—				—				(146	)			—
Net loss		$	(1,249	)		$	(3,282	)		$	(2,604	)		$	(7,957	)
Basic and diluted net loss per common share		$	(0.03	)		$	(0.09	)		$	(0.07	)		$	(0.21	)
Number of shares used in basic and diluted per share computations			38,665				37,856				38,645				37,958

		Six Months Ended June 30,
		2002				2001
		(Unaudited)
Operating activities:
Net loss		$	(2,604	)		$	(7,957	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization			1,096				1,527
Amortization of deferred stock compensation			—				180
Reduction in allowance for doubtful accounts			(82	)			(36	)
Changes in operating assets and liabilities:
Accounts receivable			177				2,655
Inventories			—				359
Income taxes receivable			(150	)			2
Prepaid expenses and other assets			403				219
Other receivables			—				451
Accounts payable			1,583				(3,198	)
Payable to a related party			(861	)			(517	)
Accrued compensation and benefits			40				(1,247	)
Accrued restructuring and other related charges			(319	)			—
Other accrued liabilities			5				(674	)
Net cash used in operating activities			(712	)			(8,236	)
Investing activities:
Purchases of property and equipment			(88	)			(755	)
Sale of long-term investments			130				—
Net cash provided by (used in) investing activities			42				(755	)
Financing activities:
Proceeds from issuance of common stock from option exercises			23				71
Repurchase of common stock			—				(1,184	)
Proceeds from issuance of common stock from ESPP			6				50
Repayment of capital lease obligations			(366	)			(801	)
Net cash used in financing activities			(337	)			(1,864	)
Net decrease in cash and cash equivalents			(1,007	)			(10,855	)
Cash and cash equivalents at beginning of period			8,606				22,879
Cash and cash equivalents at end of period		$	7,599			$	12,024
Supplemental disclosure of cash paid during the period:
Interest paid		$	46			$	96
Income taxes paid, net of refunds		$	—			$	—