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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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AMENDMENT NO. 1
TO
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES
Pursuant to Section 12(b) or (g) of the Securities Exchange
Act of 1934
DELTA CAPITAL TECHNOLOGIES, INC.
(Name of Small Business Issuer in its Charter)
Delaware, USA 98-0187705
(State of Other jurisdiction of (IRS Employer ID No.)
incorporation or organization)
SUITE 255, 999 - 8TH STREET, SW
CALGARY, ALBERTA T2R 1J5 CANADA
(Address of Principal Executive Offices)
(403) 244-7300
(Issuer's Telephone Number, Including Area Code)
Securities registered pursuant to Section 12(g) of the Act:
Title of Each Class Name of each exchange on which registered
Common Shares N/A
Securities registered pursuant to Section 12(g) of the Act: Common Shares with a
par value of $0.001
Exhibit index is included on page 24 .
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FORM 10-SB
For the Fiscal Year Ended December 31, 1998
And Period Ended July 31, 1999
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TABLE OF CONTENTS
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ITEM 1 - DESCRIPTION OF BUSINESS
Summary..............................................................................4
The Company's Market.................................................................5
The Company's Products...............................................................6
The Company's Marketing Program......................................................7
The Company's Competition............................................................8
Employees............................................................................9
Risk Factors.........................................................................9
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OR
PLAN OF OPERATION.....................................................12
ITEM 3 - DESCRIPTION OF PROPERTY.......................................................14
ITEM4 - SECURITY OWNERSHIP OF CERTAIN BENEFICAL OWNERS
AND MANAGEMENT
Security Ownership of Certain Beneficial Owners......................................14
ITEM 5 - DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS
AND CONTROL PERSONS...................................................15
ITEM 6 - EXECUTIVE COMPENSATION........................................................16
Pension Plans........................................................................17
Compensation of Directors............................................................17
Executive Compensation...............................................................17
Option Grants in Last Fiscal Year....................................................17
ITEM 7 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS................................18
ITEM 8 - DESCRIPTION OF SECURITIES
Common Stock.........................................................................18
Transfer Agent and Registrar.........................................................18
PART II
ITEM 1 - MARKET PLACE AND DIVIDENDS OF THE COMPANY'S
COMMON EQUITY AND OTHER SHAREHOLDER MATTERS
Market Information...................................................................19
Dividend Policy......................................................................19
Options Exercised....................................................................19
Warrants Exercised...................................................................20
ITEM 2 - LEGAL PROCEEDINGS.............................................................20
ITEM 3 - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE...................................20
ITEM 4 - RECENT SALES OF UNREGISTERED SECURITIES.......................................20
ITEM 5 - INDEMNIFICATION OF DIRECTORS AND OFFICERS.....................................21
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FINANCIAL STATEMENTS...................................................................22
EXHIBITS...............................................................................22
SIGNATURES.............................................................................23
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PART I
ITEM 1 - DESCRIPTION OF BUSINESS
SUMMARY
DELTA CAPITAL TECHNOLOGIES, INC. ("Delta" or the "Company") was incorporated
under the laws of Delaware on March 4, 1998. The Company originally had
authorized share capital of 1,500 common shares with a par value of $0.001,
however, on April 27, 1998 the Company filed an amendment to its Certificate of
Incorporation increasing its share capital to 25,000,000 common shares with a
par value of $0.001 per share. On March 15, 1999 the Company underwent a one for
four stock split bringing the total number of shares issued and outstanding from
2,200,000 to 8,800,000 shares issued and outstanding. As at October 13, 1999
there were 14,100,000 common shares of the Company issued and outstanding. The
Company's principal business office and registered and records office is at
Suite 255, 999 - 8th St. SW Calgary, AB T2R 1J5 Canada.
The Company is in the business of providing e-Business software and support
services.
Between March 4, 1998 and June 1, 1999 the Company's focus was directed towards
assessing various potential acquisition targets consisting of companies involved
in the development of businesses and technologies in the Internet related field.
During that period the Company spent minimal funds conducting its assessment of
various businesses and the funds required for administration of the Company
during fiscal years ended December 31, 1998 and subsequent months came from
funds raised from initial investors.
On June 1, 1999 the Company acquired the rights to an exclusive worldwide
license to the relBuilder Enterprise Suite of business intelligent e-Commerce
and e-Business software (the "Software") from 827109 Alberta Ltd. ("AltaCo"), an
Alberta, Canada based private company pursuant to a License Agreement dated June
1, 1999 between the Company and AltaCo, as amended by a Letter Agreement dated
September 2, 1999 (the "License Agreement"). The License Agreement allows the
Company to distribute licenses for the Software through sub-licenses. The
Company is responsible for the funding, the creation and management of a
distribution network for the Software, the ongoing development of the Software
and any future products or services it acquires. The License Agreement ,
requires the Company to pay to AltaCo a non-refundable lump sum license fee of
$50,000 by November 1, 1999, $45,800 of which has already been paid by the
Company. The Software application includes modules for e-Commerce, e-Project
Management, e-Customer Services, e-Document Assembly, e-Contact Management,
e-Business Intelligence and e-Back office and a Core Technology which models
business rules and relationships. Under the License Agreement, the Company is
required to pay a royalty payment of 15% of net sales with minimum amounts of
C$50,000 in the first year, C$200,000 in the second year, and C$300,000 in the
third year (the "Royalty Payments"). The term of the License Agreement is for
three years commencing June 1, 1999 and upon expiration of the term, the Company
may renew the License Agreement for an unlimited term for the sum of one ($1.00)
dollar.
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AltaCo acquired its rights to the Software from SiCom Solutions Inc., an
Alberta, Canada based private company ("SiCom") on identical terms to the
License Agreement.
Pursuant to an agreement dated June 1, 1999 between the Company and AltaCo (the
"Share Exchange Agreement") the Company agreed to issue to AltaCo 5,000,000
shares of the Company in exchange for 5,000,000 shares of AltaCo. The Company
has attributed a value of Cdn$0.50 per share for the 5,000,000 shares issued to
AltaCo, based on the attributed value of $0.50 per share for each of the
5,000,000 AltaCo shares acquired. The exchange of the shares was completed on
September 9, 1999. As a result of the shares of AltaCo issued to the Company
pursuant to the Share Exchange Agreement, the Company became the second largest
single shareholder of AltaCo holding 35.71% of the issued and outstanding shares
of AltaCo. The Company's significant shareholdings in AltaCo provides it with
the ability to have a significant influence on the operations of AltaCo. The
Company has adopted a policy whereby directors are required to disclose any
interest they have in proposed transactions or in entities with which the
Company is proposing to do business and for such directors to abstain from
voting on any directors' resolutions approving the proposed transactions. In
addition the general principals of corporate law require a director to act in
the best interests of the shareholders of the company on whose board the
director sits.
Paul Davis, the President , CEO and Director of the Company, AltaCo and SiCom
personally owns 48.21% of the issued and outstanding shares of AltaCo. Kevin
Wong, a Director of the Company and Vice President Technology and Director of
AltaCo, personally owns 16.07% of the issued and outstanding shares of AltaCo.
Rajesh Taneja is a Director of the Company and Vice President Marketing and
Director of AltaCo.
Pursuant to an agreement dated July, 1999 between the Company and Rajesh Taneja,
the Company agreed to issue 300,000 common shares to Mr. Taneja in lieu of
payment in the amount of $3,000 for Mr. Taneja's rights and ownership to the
British Columbia sole proprietorship company names "Clear Choice Media" and
"Clear Choice Technologies". The Company acquired the rights to the names
because management felt that the names would be valuable for future marketing of
software.
AltaCo will continue to develop the Software on a fair market, fee for services
basis, under direction from the Company. Similarly, AltaCo will provide support
services to the Company to ensure effective implementation of software at the
Company's client sites. The Company will pay AltaCo fees based on industry
average rates for the services it is provided. To date, the Company has relied
on research development of the Software previously funded by SiCom and has not
provided AltaCo with additional funding for the further research and development
of the Software. Accordingly, none of the costs associated with research and
development of the Software have been borne by the Company's customers.
THE COMPANY'S MARKET
The Company's acquisition of the rights to market the Software gives the Company
access to a large and rapidly growing software/services market segment as
businesses convert more of their sales, management and information processes to
utilize the Internet. The Software is aimed at serving the needs of these
businesses by providing appropriate software. The Company provides support
services through its relationship with AltaCo support services.
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THE COMPANY'S PRODUCTS
The Software consists of a software engine (the relBuilder) which is the core
technology for a suite of six enterprise-class applications which permit
companies and organizations to engage in e-Business. These applications are
fully developed and are currently marketed as product release number 1.5.
The Software applications are as follows:
1. ENTERPRISE COMMERCE APPLICATION: The Company's Enterprise e-Commerce
Application provides merchants with the ability to implement cross
selling, up selling, product dependencies, product interactions,
comparative shopping, competitive shopping, and consumer shopping
assistance wizards. Using this application, merchants and organizations
have the ability to apply the technology to the on-line and in-store
presentation of product information that begins the customer
relationship. This technology can operate on a standalone basis or can
enhance other e-Commerce solutions.
2. BACK OFFICE APPLICATION: The Back Office Application integrates
existing general ledger, accounts receivable and payable, inventory,
warehouse and other related back office functions with the Core
Technology utilizing IBM's new "San Francisco" software architecture.
3. ENTERPRISE DOCUMENT ASSEMBLY APPLICATION: The Document Assembly
Application is a content manager and document assembly tool that
maximizes re-use of corporate information by bringing together data
that is usually scattered across company-wide systems. The assembly of
data can be used for everything from contract building, to information
portal construction and management, to dynamic document creation and
presentation.
4. ENTERPRISE PROJECT MANAGEMENT APPLICATION: The Project Management
Application is equipped to handle cross-project resource analysis,
cross-project roll-ups of complex costing and estimating functions and
integrates with leading GroupWare (such as Microsoft Exchange or Lotus
Notes) to provide project-based calendaring and scheduling. The Project
Management Application provides a real-time graphical presentation of
underlying data, and the user interface changes to intelligently
reflect additions or deletions in the data.
5. ENTERPRISE CUSTOMER SERVICE APPLICATION: The Customer Service
Application has the ability to map complex call requirements, implement
sophisticated operational logic and can integrate with a web server to
allow for web-based customer self-service or call center operations
from within the office environment to across the globe.
6. ENTERPRISE CONTACT MANAGEMENT APPLICATION: The Contact Management
Application integrates with leading directory servers (such as
Microsoft Exchange and Lotus Notes) to enable highly complex mapping of
names, addresses, companies, contact information, corporate
hierarchies, active and non-active projects, and histories.
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THE COMPANY'S MARKETING PROGRAM
PARTNER PROGRAM: The Company has commenced building a network of e-Commerce and
e-Business knowledgeable consultants and solutions providers throughout North
America. The Company is providing a products and services package directed
toward established consultants (ie. "partners") who in turn integrate the
Company's Software into software provided by the consultants to provide their
clients with various forms of Internet-related business, technical or marketing
assistance. This program has both a strategic geographic and a vertical market
focus. The Company plans to penetrate the top 23 American and Canadian markets
through its Partner Program over the course of the next 18 months with its first
target markets being Seattle and Vancouver. The Company is currently pursuing
vertical markets in Education, Oil and Gas, and Manufacturing.
The Company has currently developed two partners in the consulting field for its
Partnership Program (Khyber Pass Distributing, an entertainment consulting
company; and Matradyne Corporation, a marketing business consultancy) which have
entered into agreements with the Company to re-market the Company's Software and
implement it for e-Commerce or e-Business purposes with their clients. Based
partly on experience gained from these relationships and partly from norms
established by standard industry remarketing practices, the Company is planning
its first quarter Year 2000 rollout of software and services.
The Partnership Program also includes development of relationships with internet
service providers ("ISP") to provide them with the tools and capabilities to
enable their clients to do business over the Internet. To that effect, the
Company recently entered into its first such sub-licensing agreement with
Imaginet Communication Group Inc., a company which offers Internet access and
web hosting services in Canada and the USA through its rapidly growing Imaginet
ISP Franchise Network.
STRATEGIC ALLIANCES
In addition to its Partner Program the Company has developed and will continue
to develop strategic alliances with various entities. Typically the strategic
alliances result in the Company marketing another company's products or the
Company utilizing other companies' software products within the company's
products which facilitates a sharing of its information and an exchange of ideas
between the parties.
The Company has a strategic alliance with BCE-Emergis, Montreal, to remarket
various credit card clearing services. It also has an agreement with Smart
Technologies Inc., Calgary, to include that company's "Smart Ideas" concept
mapping tools as a part of the standard user interface options of its relBuilder
software. As the Company's business develops, it is anticipated that it will
utilize the services and product offerings of industry leaders in enhancing the
Company's product/service offering while at the same time encouraging use of the
relBuilder core technology and software suite. These future alliances will be
contracted-based agreements aimed at enhancing the Company's position in the
marketplace by leveraging the knowledge, expertise and sales networks of the
parties with whom it forms alliances to the mutual benefit of both.
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CORE TECHNOLOGY PROGRAM: The Company will seek affiliations with major
e-Commerce and e-Business organizations to market its relBuilder core
technology. Exposure of the Company's core technology began with the company's
IBM "San Francisco" technology Fast Start award and participation in the June
1999 Java One conference. It has continued with the Company's technical team,
assisted by IBM Rochester, Maryland based San Francisco and porting centre
teams, successfully completing enterprise scalability testing of the relBuilder
software suite.
DEPENDENCY: The Company is not dependent upon any single partner, strategic
alliance or client. The Company's "Partner Program" has three companies involved
(Imaginet Communication Group Inc.; Khyber Pass Distribution; and Matradyne
Corporation).; the Company has two companies with which it has strategic
alliances (BCE Emergis and Smart Technologies Inc.) and it is seeking to develop
core technology affiliations. Delta also currently works directly with a further
six client/customer companies which use the Company's software and services
offering: Shaw Communications Inc., a cable company; Fairplay Network, a retail
organization; Chevron Canada Resources, an oil company; Oil & Gas Trading
Partners Network, an oil and gas industry information initiative; Rand Worldwide
Inc., an integrated manufacturing company and the I-School Network, an
interactive education network system based in Calgary, Alberta. The Company has
not entered into any formal affiliations to market its core technology as of
this filing.
THE COMPANY'S COMPETITION
The Company's software and services offering crosses over many business
boundaries and encounters a variety of competitors which serve various segments
of the marketplace. There is no known direct competitor with both an intelligent
e-Business engine technology and a suite of fully integrated e-business
applications. The Company's management believes that its proprietary relBuilder
software engine combined with its six enterprise-class applications provide it
with the capability and flexibility to effectively exploit selected target
markets as discussed in the marketing section. Alternatively, the Company can
work with established marketplace players to enhance their software and services
offerings through sub-licensing its relBuilder core technology, also as
discussed in the marketing section.
The Software named "Knowledge Broker" from Black Pearl Software uses
relationship modeling and classic analytical business intelligence to indicate
trends and opportunities in a manner similar to those functions as found in the
Company's relBuilder software suite. While Knowledge Broker has much in common
with the Company's products, but Knowledge Broker does not have e-business
modules which match the Company's six enterprise-class applications.
There are many large companies and organizations which provide competition in
the provision of software competitive to the Company's six enterprise-class
applications. IBM is a major and active e-Business force under its WebSphere
e-Business Solutions banner. Microforum Inc. (TSE:MCF), Scient Corporation
(NASD:SCNT), Razorfish Inc. (NASD:RAZF), Proxicom Inc. (NASD:PXCM) and a variety
of middle market companies provide software solutions combined with consulting
services and, as such, are competitors in various segments of the market.
Specialist companies, led by Blue Martini Software, have developed e-Commerce
and e-Catalogue implementations to produce sophisticated Internet-based
merchandizing and sales programs.
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EMPLOYEES
The Company currently has two full time employees who are each paid $3,000 per
month plus expenses pursuant to verbal agreements entered into with the Company
that commenced on June 15, 1999. The Company also currently has two part time
individuals under contracts pursuant to which one individual receives Cdn $2,500
per month pursuant to a contract which commenced June 15, 1999 and the other
individual receives Cdn $7,500 a month pursuant to a contract which commenced
July 15, 1999. The Cdn $2,500 part time employee spends 50% of her time on
Company administration and the balance of her time providing administrative
services to non-competitive clients through her wholly owned company called
J.A.M. Corporate Consulting Inc. The Cdn $7,500 individual spends 75% of his
time on Company business and the balance consulting to non-competitive
companies.
RISK FACTORS
The Company's business is subject to numerous risks, including the following:
LIMITED OPERATING HISTORY AND MINIMAL REVENUE AND ASSETS MAY RESULT IN LOSSES
AND DIFFICULTY IN OBTAINING FINANCING: The Company has had limited operating
history, has received minimal revenue from operations and has minimal assets.
The Company will, in all likelihood, sustain operating expenses in excess of
revenues until it is better established and will therefore require additional
funding to continue operations and to have sufficient working capital to sustain
operations. Because the Company has minimal assets it may be difficult or even
impossible for the Company to obtain debt financing at this stage in the
Company's development. No assurances can be given that the Company will operate
profitably in the future or that it will be able to obtain further financing.
WITHOUT FURTHER FINANCING THE COMPANY MAY CEASE TO BE A GOING CONCERN. The
Company will need additional working capital to be successful in its planned
activity and continuation of the Company as a going concern is dependent upon
obtaining the working capital necessary and Management of the Company has
developed a strategy, which it believes will accomplish this objective through
additional equity funding, and long term financing, which will enable the
Company to operate in the future. Although Management believes it will be able
to obtain such funding for the Company there is no assurance they will be
successful in order to keep the Company operating as a going concern.
NEW AND DEVELOPING TECHNOLOGIES/MARKET CONDITIONS MAY RESULT IN PROJECTIONS NOT
BEING ACHIEVED: The e-Commerce/e-Business marketplaces, along with vertical
applications, have been identified by Management as significant emerging market
segments with substantial projected growth potential. Should these market
segments not develop in the manner expected, or should they fail to develop as
quickly as anticipated, the Company's business, sales, finances and operating
results could be materially and adversely affected resulting in the Company
being less profitable than anticipated.
STRATEGIC PARTNERS MAY NOT PRODUCE ANTICIPATED SALES: The revenues of the
Company pertaining to product sales, are dependent to a large degree on the
ability of its strategic partners to generate transaction volumes and provide
new markets for products of the Company. The Company generates sales by
supplying strategic partners with products and
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10
services that the partners market to their customers. If the Company's strategic
partners are unsuccessful in their businesses or if a substantial number of the
Company's strategic partners cease doing business with the Company, the Company
will sell fewer products and services to strategic partners and the Company's
revenue will be impacted negatively.
DEPENDENCE UPON KEY PERSONNEL: Success of the Company depends to a significant
degree upon the continued contribution of its Management. Current Management
have been involved in the development of the Software from the first stages of
its development and their intimate knowledge of the Software together with their
vision of how the Software should be developed in the future makes this
Company's future success highly dependant on current Management. Because the
computer software industry exists in a rapidly changing environment it is
important for key personnel to have a historic appreciation of the evolution of
a given piece of software in the context of a provider's corporate strategy.
Management believes that customers of the Company's products are based on
existing capabilities, but also purchase products based on their belief that the
Company has the personnel that is capable of upgrading and causing the Software
to be further developed in the future. Loss of current personnel may result in
customers losing confidence in the Company's future capability to deliver
competitive Software in the future. At present the Company has no key-man life
insurance on its key personnel. Further, at present, the Company does not have
written employment contracts with its key personnel and accordingly the Company
would not be able to contractually prevent a member of key personnel from
leaving the Company. Although the Company does not believe that any of its key
personnel are considering retirement or planning on leaving the Company for
other reasons, there is no assurance that one or more of the key personnel won't
leave the Company in the near future.
LACK OF EXPERIENCE OF MANAGEMENT COULD LESSEN PROFITABILITY: Management of the
Company has only limited business experience in running an operating company and
Management has no experience in operating a public company. In implementing a
successful marketing plan for the Company's services, management lacks
experience which could result in the Company being less efficient with its use
of funds than if Management had more experience. Additional management skills
and knowledge will be required to operate the Company's business profitably if
sales volumes and revenues increase, and the number of employees increase.
Although Management intends on acquiring more experienced personnel in the
future as the Company grows, until more experienced personnel are hired the
Company may be less profitable.
RISK OF OBSOLESCENCE: Unless the Company can continue to successfully develop
and upgrade the Software over time, the Software may become obsolete compared
with other software which is introduced to the market place, Because software
evolves rapidly it is important for producers to be constantly refining and
upgrading their software products to remain competitive. Although Management
believes that the Company's personnel have the required talent to cause the
Software to remain competitive, there is no assurance that the Software will not
become obsolete.
COMPETITION MAY RESULT IN LOWER MARKET SHARE AND LOWER PROFITABILITY: The market
for e-commerce is intensely competitive, evolving and subject to rapid
technological change. Intensity of competition is likely to increase in the
future. Increased competition from new competitors is likely to result in loss
of market share, which could negatively impact the Company's business.
Competitors vary in size, and in scope and breadth of the products and
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11
services offered and the Company may receive competition from several major
enterprise software developers. In addition, because there are relatively low
barriers to entry in this market, additional competition from other established
and emerging companies may develop.
Many current and potential competitors have longer operating histories,
significantly greater financial, technical, marketing and other resources than
the Company, significantly greater name recognition, and a larger base of
customers. In addition, many of the competitors have well-established
relationships with clients and potential clients, and have extensive knowledge
of the industry. Current and potential competitors have established or may
establish cooperative relationships among themselves or with third parties to
increase the ability of their products to address customer needs. Accordingly,
it is possible that new competitors, or alliances among competitors, may emerge
and rapidly acquire significant market share which may result in lower sales of
the Software resulting in the Company being less profitable.
GROWTH AND EXPANSION MAY TAX THE COMPANY'S RESOURCES RESULTING IN CUSTOMER
DISSATISFACTION: The Company's anticipated growth may place a significant strain
on the Company's administrative, operational and financial resources and
increase demands on its systems and controls. As the Company increases its
service offerings and expands its targeted markets, there will be additional
demands on the Company's customer support, sales and marketing and
administrative resources and network infrastructure. There can be no assurance
that the Company's operating and financial control systems and infrastructure
will be adequate to maintain and effectively monitor future growth. The failure
to continue to upgrade the administrative, operating and financial control
systems or the emergence of unexpected expansion difficulties could result in
customer dissatisfaction with attendant loss of sales.
COMPANY'S STOCK DEEMED TO BE A PENNY STOCK WHICH MAY RESULT IN DECREASED
LIQUIDITY: The Securities and Exchange Commission adopted Rule 15g-9 which
established the definition of a "penny stock", for purposes relevant to the
Company, as any equity security that has a market price of less than $5.00 per
share or with an exercise price of less than $5.00 per share, subject to certain
exceptions. For any transaction involving a penny stock, unless exempt the rules
require: (i) that a broker or dealer approve a person's account for transactions
in penny stocks; and (ii) the broker or dealer receive from the investor a
written agreement to the transaction, setting forth the identity and quantity of
the penny stock to be purchased. In order to approve a person's account for
transactions in penny stocks, the broker or dealer must: (i) obtain financial
information and investment experience and objectives of the person; and (ii)
make a reasonable determination that the transaction in penny stocks are
suitable for that person and that person had sufficient knowledge and experience
in financial matters to be capable of evaluating the risks of transactions in
penny stocks. The broker or dealer must also deliver, prior to any transaction
in a penny stock, a disclosure schedule prepared by the Commission relating to
the penny stock market, which, in highlight form, (i) sets forth the basis on
which the broker or dealer made the suitability determination; and (ii) that the
broker or dealer received a signed, written agreement from the investor prior to
the transaction. Disclosure also has to be made about the risks of investing in
penny stock in both public offering and in secondary trading, and about
commissions payable to both the broker-dealer and the registered representative,
current quotations for the securities and the rights and remedies available to
an investor in cases of fraud in penny stock transactions. Finally, monthly
statements have to be sent disclosing recent price information for the penny
stock held in the account and information on the limited market in penny stocks.
As a result of the penny stock trading restrictions brokers or potential
investors may be
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reluctant to trade in the Company's securities which may result in less
liquidity for the Company's stock.
YEAR 2000 RISK: The Company's internally used computers and products produced or
licensed by the Company are "Y2K" compliant and do not represent a risk for
users. To the extent that the Company may be exposed to possible year 2000
failures of its trading partners, the Company's staff and the staff of AltaCo
have been educated on the Year 2000 problem and an inquiry program as to the
readiness of trading partners has been initiated. Although the Company has used
its best efforts to ensure that any contracted technology deliverables to the
Company are "Y2K" compliant, the Company cannot be sure that all outside
organizations beyond its control which impact or may impact the Company's
business, will be Y2K compliant by December 31, 1999.
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
OPERATION
Management discussion and analysis of financial condition and results of
operations for the period ended July 31, 1998 compared to the period ended July
31, 1999.
Delta Capital Technologies Inc. ("Delta or the Company") is at an early stage.
It has successfully achieved its first objective: the acquisition of Internet
technologies and is now developing plans to take these technologies to market.
It plans to commence significant marketing activities in the first quarter of
2000. During the period under review, Delta's modest expenditures have been made
in support of finding appropriate Internet technologies and, as well, for audit,
income tax returns and meeting various regulatory requirements. Substantially
all cash required for operations has come from investors.
On June 1, 1999, Delta acquired the exclusive worldwide license to the
relBuilder Enterprise Suite of intelligent e-Commerce and e-Business software
from 827109 Alberta Ltd. (AltaCo), an Alberta, Canada-based private company.
Under the agreement, Delta will pay AltaCo fifteen percent (15%) royalty
payments in the minimum amount of C$100,000 in the first year, C$200,000 in the
second year and C$300,000 in the third year.
The software may be sub-licensed under terms of the agreement.
The Company's marketing program involves the development of a variety of
different types of relationships with the entities with which the Company does
business as follows:
1. the Partner Program which involves the Company providing products and
services to establish customers (ie. "partners") who in turn integrate
the Company's Software with other software and provide their clients
with various forms of Internet-related business, technical or marketing
assistance. The Company currently has three partners who perform this
function: Khyber Pass Distributing, an entertainment consulting
company; Metradyne Corporation, a marketing business consultancy; and
Imaginet Communications Group Inc., an Internet services provider;
2. strategic alliances which typically involves the Company marketing
another company's products or the Company utilizing other companies'
software products within the Company's product. The Company currently
has strategic alliances with BCE Emergis of Montreal and Smart
Technologies Inc. of Calgary;
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13
3. core technology affiliations pursuant to which the Company will seek to
establish relationships with major e-Commerce and e-Business
organizations to market its core Software technology. The Company is
currently working towards establishing core technology affiliations
with IBM but as of the date of this filing has not established a formal
relationship;
4. relationships which result in clients/customers utilizing the Software.
The Company currently works directly with six companies which use the
Company's Software and services (Shaw Communications Inc., Fairplay
Network, Chevron Canada Resources, Oil and Gas Trading Partners
Network, Rand Worldwide Inc. and I-School Network.
A) Plan of Operation:
a) The Company anticipates modest revenues over the next 12
months and anticipates continuing losses from operations as
it introduces its relBuilder software and services offering
to the marketplace. Based on the current costs associated
with operating the Company, Delta will require US$240,000
financing through the end of 1999. Delta plans to raise
additional funds during the next 12 months in the amount of
approximately US$2.5 million through equity financing,
participation in a major industry software/hardware company's
support program and debt financing to finance its operations.
It is management's view that virtually all businesses in
future will have e-Commerce/e-Business requirements and that
the nature and conduct of business in general will be
fundamentally changed. In a marketplace where the demand for
Internet software and services is growing rapidly, a trend
which is expected to continue for the foreseeable future,
Delta's goal is to spend the next 12 months establishing its
distribution and sales channels, negotiating its partnership
arrangements and working to gain strategic partners to
utilize Delta's core technology relBuilder software. Delta
management anticipates positive cash flow in the fourth
quarter of its upcoming fiscal year.
b) Delta will perform market research in the next 12 months help
gauge marketplace acceptance of its software and services.
Delta will not undertake any product development in the
coming 12 months. However, AltaCo will continue development
of the relBuilder software suite. Delta will purchase from
AtlaCo, services at fair market rates to ensure continued
development of software and provision of support services.
Delta will purchase from AtlaCo, services at fair market
rates to ensure continued development of software and
provision of support services. Delta will be AltaCo's single
largest client and, as such, Delta's purchase of services
from AltaCo will represent substantially all its business. It
is Delta's intention, as described above, to utilize the
services of AltaCo's nine employees for the continued
development of software and for support services functions.
Delta will also re-license back to AltaCo certain of its
rights under Delta's worldwide license to permit AltaCo to
undertake marketing initiatives in certain Canadian markets
and market segments as seems appropriate to Delta.
Specifically, Delta will encourage AltaCo to market the
relBuilder software in the Alberta, Canada, marketplace,
where AltaCo is based and to work with certain industries and
organizations, as yet undefined, where it is felt that AltaCo
is better positioned to service marketplace needs and
requirements.
<PAGE>
14
c) Delta management does not anticipate any material plant or
equipment purchases in the next 12 months.
d) Delta management anticipates that it will add approximately
10 employees in the coming year, including personnel with
specialized technology financial experience as well as
specific industry sales experience.
e) Although management does not anticipate Y2K problems,
management does recognize that there are risks associated
with dealing with other parties who may not be Y2K compliant.
ITEM 3 - DESCRIPTION OF PROPERTY
The Company does not own any properties but utilizes, without charge and under a
verbal agreement, premises leased by AltaCo which consist of approximately 2,537
square feet on the second floor of an office building situated at 999 - 8th
Street, S.W., Calgary, Alberta. The Company will give consideration to acquiring
its own leased premises in the future if warranted but as of this date the
Company has not acquired leased premises and there are no specific plans to do
so.
ITEM 4 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth, as of October 13, 1999 information with respect
to the beneficial ownership by each person who is known to the Company to be the
beneficial owner of more than 5% of the Company's common shares, by each
director and executive officer and by all executive officers and directors as a
group. All persons named below have sole voting and investment power over their
shares except as otherwise noted. The Company's common stock is the only class
of voting securities outstanding.
<TABLE>
<CAPTION>
----------------------------------------------- -------------------------- ---------------------------------
<S> <C> <C>
NAME, MUNICIPALITY OF RESIDENCE AND OFFICE COMMON SHARES PERCENTAGE OF
HELD BENEFICIALLY OWNED COMMON SHARES
DIRECTLY OR INDIRECTLY
----------------------------------------------- -------------------------- ---------------------------------
Paul Davis(1) 5,000,000 35.71%
8 Stratton Place SW
Calgary, Alberta T3H 1T6
President and Director
----------------------------------------------- -------------------------- ---------------------------------
Kevin Wong(2) 803,571 5.74 %
341 - 33rd Avenue NE
Calgary, Alberta T2E 2H9
Director
----------------------------------------------- -------------------------- ---------------------------------
Rajesh Taneja 300,000 2.14 %
#104, 10668 - 138th Street
Surrey, BC V3T 4K5
Director
----------------------------------------------- -------------------------- ---------------------------------
</TABLE>
<PAGE>
15
<TABLE>
----------------------------------------------- -------------------------- ---------------------------------
<S> <C> <C>
Judith Miller(3) 246,000 1.76 %
B201 - 1331 Homer Street
Vancouver, BC V6B 5M5
Secretary/Treasurer and Director
----------------------------------------------- -------------------------- ---------------------------------
T. Davis Capital Corp. 800,000 5.71%
5167 Galway Drive
Delta, BC V4M 2R4
----------------------------------------------- -------------------------- ---------------------------------
All Officers and Directors as a Group 7,149,571 51.06 %
----------------------------------------------- -------------------------- ---------------------------------
</TABLE>
(1) Mr. Davis owns 6,750,000 shares of the 14,100,000 issued shares of AltaCo
and the shares identified represent his beneficial ownership of the
5,000,000 Delta shares issued to AltaCo.
(2) Mr. Wong owns 2,250,000 shares of the 14,100,000 issued shares of AltaCo
and the shares identified represent his beneficial ownership of the
5,000,000 Delta shares issued to AltaCo.
(3) Included in this figure are stock options entitling Ms. Miller to purchase
200,000 shares of the Company exercisable at US$0.0075 per share. The
option expires December 31, 1999.
The 5,000,000 shares issued to AltaCo, the 800,000 shares issued to T. Davis
Capital Corp. and the 300,000 shares issued to Rajesh Taneja are subject to
Federal Securities Laws Rule 144, and thus have restrictions on their resale for
a minimum of one year from the date of issuance. At that point they may be
subject to even further restrictions based on the regulations and requirements
set forth in Rule 144.
ITEM 5 - DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
The following table identifies the Company's directors and executive officers as
of October 13, 1999:
<TABLE>
<CAPTION>
--------------------------- ----------- ---------------------------------------------------------------------
Name Age Position
--------------------------- ----------- ---------------------------------------------------------------------
<S> <C> <C>
Paul Davis 48 President, CEO and Director since June 4, 1999
--------------------------- ----------- ---------------------------------------------------------------------
Kevin Wong 26 Director since June 4, 1999
--------------------------- ----------- ---------------------------------------------------------------------
Rajesh Taneja 29 Director since June 4, 1999
--------------------------- ----------- ---------------------------------------------------------------------
Judith Miller 59 Corporate Secretary and Director since April 28, 1998
--------------------------- ----------- ---------------------------------------------------------------------
</TABLE>
Directors are elected at the Company's annual general meeting of shareholders or
may be appointed by existing directors between annual general meetings of
shareholders and hold office until they resign or their successors are elected.
The Company's officers are appointed by the board of directors and serve at the
pleasure of the board. Following is a summary of the occupation of the Directors
and Executive Officers of the Company over the last five years:
<PAGE>
16
PAUL DAVIS, President, CEO and Director of the Company founded, in October,
1996, SiCom Solutions Inc. which developed the Software. Since SiCom's inception
Mr. Davis has been responsible for developing SiCom's business model,
integration strategy, partnership and financing. In the period 1994 to October,
1996 Mr. Davis was President and CEO of HPCC High Performance Computing Centre
("HPCC"), a Calgary, Alberta based private company. During this employment with
HPCC Mr. Davis' responsibility was to develop high performance computing and
advanced applications associated with high-speed networking. In 1994 Mr. Davis
received his Bachelor of Applied Science, Electrical Engineering with a
specialty in computing technology and power engineering.
RAJESH TANEJA, Director of the Company, has, over the last five years, provided
technical and sales support to a variety of companies involved in the computer
software industry or to companies utilizing products provided by the computer
software industry. Mr. Taneja founded Clear Choice Media in 1998 and has served
as its Chief Executive Officer since its inception. He has served as President
and senior web designer for Clear Choice Technologies since 1997 and served as
senior inter/intranet engineer for Metasoft Systems Inc. from 1997 to 1999. Mr.
Taneja provided technical support to Raptor Capital Corporation from 1997 to
1999; served as technical manager of Cross Systems Inc. from 1996 to 1997 and
was technical and sales manager of the Trumpet Tech Group of Companies Inc. in
1996. Mr. Taneja was President of Tin Webdesigner and New Media from 1995 to
1999 and from 1994 to 1995 he held the position of Senior Network Implementation
and Support Staff with Combit Net/FX, a company which provided networking and
software implementation to a variety of clients including the Government of
India.
KEVIN WONG, Director of the Company, has been Vice President and Director of
SiCom Solutions Inc. since 1997 where he developed the technical information and
inception model for the Software. In the 4 years prior to April, 1997, Mr. Wong
attended University during which time he obtained a law degree from the
University of Windsor, Ontario.
JUDY MILLER, Secretary and Director of the Company, has been President and
Director of J.A.M. Corporate Consultants Inc. ("JAM") since March 1994. JAM,
which is wholly owned by Ms. Miller, is a private company incorporated pursuant
to the laws of British Columbia, provides a variety of services including office
management and administration, meeting and special event planning, office
redesign/relocation, and fund raising. Ms. Miller is the sole employee of JAM
and accordingly is responsible for providing JAM's services.
The above individuals are the only key personnel presently associated with the
Company.
ITEM 6 - EXECUTIVE COMPENSATION
The following compensation information relates to amounts paid to the Chief
Executive Officer for the preceding three (3) years. No director or executive
officer received compensation in excess of $100,000 in 1998.
<TABLE>
<CAPTION>
- ------------------------ ---------------------------- -------------------------------------------------- -----------
ANNUAL COMPENSATION LONG TERM COMPENSATION
--------------------------------------- ---------- -----------
AWARDS PAYOUTS
OTHER SECURITIES RESTRICTED
ANNUAL UNDER SHARES OR LTIP ALL OTHER
NAME AND PRINCIPAL YEAR COMPEN- OPTIONS RESTRICTED PAY-OUTS COMPENSATION
POSITION ENDING SALARY BONUS SATION GRANTED SHARE UNITS
- ------------------------ --------- --------- -------- ----------- ------------- ------------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Paul Davis 1998 Nil Nil Nil Nil Nil Nil Nil
President (1)
- ------------------------ --------- --------- -------- ----------- ------------- ------------- ---------- -----------
</TABLE>
Note: There were no compensation payments to Chief Executive Officer for
preceding 3 yrs.
(1) The Company does not have a Chief Executive Officer but for the purposes
of disclosure hereunder Mr. Davis, as President, is deemed to be the Chief
Executive Officer.
<PAGE>
17
PENSION PLANS
The Company does not have a defined benefit pension plan that provides annual
benefits to any Executive Officers.
COMPENSATION OF DIRECTORS
None of the Directors receive Director's fees.
EXECUTIVE COMPENSATION
The Vice President Marketing and Corporate Secretary received US$3,000.00 and
US$2,000.00, respectively, during 1998. No other Executive Officers of the
Company received any reportable salary or bonus during 1998.
The following table sets forth as to each named Executive Officer certain
information concerning the grant of options during the year ended January 31,
1999:
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
- ---------------------- ---------------------- ---------------------- --------------------- ---------------------
NAME NUMBER OF SECURITIES % OF TOTAL OPTIONS EXERCISE OR EXPIRATION DATE
UNDERLYING OPTIONS GRANTED TO EMPLOYEES BASE PRICE
GRANTED IN FISCAL YEAR
- ---------------------- ---------------------- ---------------------- --------------------- ---------------------
<S> <C> <C> <C> <C>
Judith Miller 200,000 200,000 US$0.0075 Dec. 31, 1999
- ---------------------- ---------------------- ---------------------- --------------------- ---------------------
</TABLE>
Pursuant to a verbal agreement among the board of directors of the Company,
Judith Miller was granted a stock option to purchase 200,000 common shares of
the Company at a price of US$0.0075 per common share until August 26, 1999. On
August 11, 1999, by way of written consent resolution, the board of directors
extended the stock option expiration date from August 26, 1999 to December 31,
1999. On September 15, 1999 the terms of the stock option agreement were reduced
to writing.
ITEM 7 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company is subject to various conflicts of interest arising out of its
relationships with its Executive Officers, Directors and shareholders,
including conflicts related to the arrangements by which the Company acquired
certain of is assets, as described below are conducted as arm's-length
transactions and were in the best interest of the Company. The Company intends
to continue to exercise its best business judgement and discretion in involving
any such conflicts between the Company and others with respect to these and all
other matters, and the Company believes that it will generally be able to
resolve such conflicts on an equitable basis.
<PAGE>
18
Paul Davis, President and Director of the Company and President and Director of
AltaCo, holds 6,750,000 shares of AltaCo and 3,140,857 shares of SiCom. Mr.
Davis receives $6,000.00 per month as an employee of AltaCo.
Kevin Wong, Director of the Company and is Director and Vice-President
Technology of AltaCo. Mr. Wong owns 2,250,000 shares of AltaCo and 440,000
shares of SiCom and he receives C$4,000 per month as an employee of the AltaCo.
Rajesh Taneja, Director of the Company and is Vice-President Marketing of
AltaCo. Mr. Taneja owns 300,000 shares of the Company and he receives C$3,000
per month as an employee of the Company.
Judy Miller, Director and Secretary of the Company owns 96,000 shares of the
Company and has an option to purchase 200,000 shares of the Company for $0.0075
per share exercisable until December 31, 1999. Ms. Miller originally
participated in a private placement for 24,000 shares of the Company at $.001
per share prior to the consolidation of the Company's shares on a 4:1 basis. The
Company paid Ms. Miller US$2,000 in November, 1998 for administrative services
and pursuant to a verbal consulting contract effective June 15, 1999 receives
C$2,500 per month from the Company.
During the last two years the Company has not been a party to and it is not
proposed that the Company will be a party to any transactions in which any
director, nominee for election as a director, executive officer, beneficial
owner of greater than 5% of the Company's common shares or any member of the
immediate family of such persons had or is to have a direct or indirect material
interest except the following:
a) the Share Exchange Agreement;
b) the License Agreement;
c) the purchase of the trade names "Clear Choice Media" and "Clear
Choice Technologies" from Rajesh Taneja for 300,000 shares;
d) the verbal agreement pursuant to which the Company utilizes the
leased space in Calgary, Alberta; and
e) stock option agreement with Judith Miller.
ITEM 8 - DESCRIPTION OF SECURITIES
COMMON STOCK
The Company originally had authorized share capital of 1,500 common shares with
a par value of $0.001 but subsequently increased its share capital to 25,000,000
common shares with a par value of $0.001 per share. On March 15, 1999 the
Company underwent a one for four stock split increasing its issued and
outstanding to 8,800,000 common shares. As at October 13, 1999 there were
14,100,000 common shares of the Company issued and outstanding.
TRANSFER AGENT AND REGISTRAR
The Company's Transfer Agent is Signature Stock Transfer in Dallas, Texas.
<PAGE>
19
PART II
ITEM 1 - MARKET PLACE AND DIVIDENDS ON THE COMPANY'S COMMON EQUITY AND OTHER
SHAREHOLDER MATTERS
MARKET INFORMATION
The Company's common stock is currently traded on the National Association of
Securities Dealers Inc. Automated Quotation System's Bulletin Board, using the
stock symbol "DCTG." Only a limited public trading market exists for the
Company's outstanding stock, and there can be no assurance that an active public
market will develop. The Company's common stock commenced trading in March 1999
and the highest and lowest prices for the Company's common stock during the
calendar quarter ended June 30, 1999 and the closing bid price on such date is
as follows:
Delta Capital Technologies Inc. (Monthly Summary of Trades):
<TABLE>
<CAPTION>
- -------------------- ------------------ ------------------- ------------------ ------------------ --------------
Date High Low Close Volume Trades
- -------------------- ------------------ ------------------- ------------------ ------------------ --------------
<S> <C> <C> <C> <C> <C>
Oct/99 2.40 2.00 2.10 210,000 41
- -------------------- ------------------ ------------------- ------------------ ------------------ --------------
Sept/99 2.60 2.00 2.10 209,000 43
- -------------------- ------------------ ------------------- ------------------ ------------------ --------------
Aug/99 3.00 2.20 2.42 98,400 19
- -------------------- ------------------ ------------------- ------------------ ------------------ --------------
July/99 3.10 2.40 2.98 58,500 27
- -------------------- ------------------ ------------------- ------------------ ------------------ --------------
June/99 3.00 2.07 3.00 55,500 36
- -------------------- ------------------ ------------------- ------------------ ------------------ --------------
May/99 - - - - -
- -------------------- ------------------ ------------------- ------------------ ------------------ --------------
April/99 - - - - -
- -------------------- ------------------ ------------------- ------------------ ------------------ --------------
Mar/99 3.00 2.15 3.00 8,000 10
- -------------------- ------------------ ------------------- ------------------ ------------------ --------------
</TABLE>
These quotations reflect inter-dealer prices without retail work-up, mark-down
or commission and may not represent actual transactions.
As of the date of this Registration Statement, the Company has 33 registered
shareholders which included Cede & Co. holding 1,959,000 shares. Because Cede &
Co. is an intermediary, the Company does not know how many beneficial
shareholders are included in the shares held in the name of Cede & Co.
DIVIDEND POLICY
The Company has not paid any cash dividends on its common stock and does not
anticipate paying any cash dividends in the foreseeable future. The Company
currently intends to retain future earnings, if any, to fund the development and
growth of its business. Any future determination to pay cash dividends will be
at the discretion of the board of directors and will be dependent upon the
Company's financial condition, operating results, capital requirements,
applicable contractual restrictions and other factors as the board of directors
deems relevant.
OPTIONS EXERCISED
None of the Company's previously granted stock options have been exercised.
<PAGE>
20
WARRANTS EXERCISED
To date the Company has not issued any share purchase warrants.
ITEM 2 - LEGAL PROCEEDINGS
There are no material legal proceedings to which the Issuer is a party nor to
the best of the knowledge of management, are any material legal proceedings
contemplated.
ITEM 3 - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
There have been no disagreements between the Company and its accountants since
the Company's inception in March of 1998.
ITEM 4 - RECENT SALES OF UNREGISTERED SECURITIES
During April of 1998, the Company issued to T. Davis Capital Corp. 200,000
shares of restricted common stock as repayment of the $206.95 incorporating
expenses paid on the Company's behalf by T. Davis Capital Corp. This share
issuance was exempt from registration under Section 4(2) of the Securities
Exchange Act of 1934 and the appropriate restrictive legend was placed on the
share certificate issued.
During April, 1998 the Company sold 2,000,000 shares of unrestricted common
stock, and received $60,000. This offering was a private placement and the
Company was exempt from registration under the Exchange Act. Further the Company
was eligible under Securities and Exchange Commission Rule 504, which allowed
the shares sold in this private placement to be issued without restrictive
legend. The recipients of these shares, primarily being the Company friends,
relatives and business associates of the Company's officers, directors and
investors, represented their intention to acquire the shares for investment
purposes only, and not with a view to resale or distribution.
The 2,000,000 shares of the Company were issued to the following in the
indicated amounts:
<TABLE>
<CAPTION>
- ------------------------------------------ ------------------- -------------------------------- ----------------
NAME NUMBER NAME NUMBER
OF SHARES OF SHARES
- ------------------------------------------ ------------------- -------------------------------- ----------------
<S> <C> <C> <C>
Bonanza Management Ltd. 100,000 Hutchinson, Janet 100,000
- ------------------------------------------ ------------------- -------------------------------- ----------------
Brookes, Heather 14,000 Ivancoe, Joseph 100,000
- ------------------------------------------ ------------------- -------------------------------- ----------------
Brookes, Ken 50,000 Ivancoe, Leigh 100,000
- ------------------------------------------ ------------------- -------------------------------- ----------------
Butchart, Terry 10,000 Johnson, Edward 14,000
- ------------------------------------------ ------------------- -------------------------------- ----------------
Butchart, Jodi 9,000 Johnson, Linda 105,000
- ------------------------------------------ ------------------- -------------------------------- ----------------
Charban, Emil 95,000 Miller, Judith 24,000
- ------------------------------------------ ------------------- -------------------------------- ----------------
Clemis, Barry 90,000 Mizener, Doreen 20,000
- ------------------------------------------ ------------------- -------------------------------- ----------------
Connors, Melissa 105,000 Polymenkas, Nicky 100,000
- ------------------------------------------ ------------------- -------------------------------- ----------------
Crawford, Mark 105,000 Smart Communications 105,000
- ------------------------------------------ ------------------- -------------------------------- ----------------
Delaney, Gail 19,000 Smeds, Sven 95,000
- ------------------------------------------ ------------------- -------------------------------- ----------------
</TABLE>
<PAGE>
21
<TABLE>
<CAPTION>
- ------------------------------------------ ------------------- -------------------------------- ----------------
NAME NUMBER NAME NUMBER
OF SHARES OF SHARES
- ------------------------------------------ ------------------- -------------------------------- ----------------
<S> <C> <C> <C>
Delaney, Greg 150,000 Smith, Guy 105,000
- ------------------------------------------ ------------------- -------------------------------- ----------------
Forgie, Ross 100,000 Smith, Richard 100,000
- ------------------------------------------ ------------------- -------------------------------- ----------------
Gallant, Richard 95,000 T. Davis Capital Corp. 200,000
- ------------------------------------------ ------------------- -------------------------------- ----------------
Gardiner, Thomas 90,000
- ------------------------------------------ ------------------- -------------------------------- ----------------
</TABLE>
During March, 1999 the 2,200,000 shares of the Company, which were issued at
that time, were split on a four for one basis resulting in 8,800,000 shares
being issued and outstanding.
During September, 1999 the Company issued to Rajesh Taneja 300,000 shares of
restricted common stock in lieu of $3,000 as payment for the rights and
ownership to the British Columbia sole proprietor company names "Clear Choice
Media" and "Clear Choice Technologies". This share issuance was exempt from
registration under Section 4(2) of the Securities Exchange Act of 1934. The
appropriate restrictive legend was placed on the share certificate issued.
During September, 1999 the Company issued to AltaCo 5,000,000 shares of
restricted common stock to acquire 5,000,000 shares of AltaCo. This share
issuance was exempt from registration under Section 4(2) of the Securities
Exchange Act of 1934. The appropriate restrictive legend was placed on the share
certificate issued.
ITEM 5- INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the General Corporation Law of the State of Delaware (the "DECL")
provides, in general, that a corporation incorporated under the laws of the
State of Delaware, such as the Company, may indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding (other than a derivative action by or in
the right of the Corporation) by reason of the fact that such person 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 enterprise, against expenses (including attorney's fees), judgement,
fines and amounts paid in settlement actually and reasonably incurred by such
person in connection with such action, suit or proceeding if such person acted
in good faith and in a manner such person reasonably believed to be in or not
opposed to the best interests of the corporation, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe such persons
conduct unlawful. In the case of a derivative action, a Delaware corporation may
indemnify any such person against expenses (including attorney's fees) actually
and reasonably incurred by such person in connection with the defense or
settlement of such action or suit if such person acted in good faith and in a
manner such person reasonably believed to be in or not opposed to the best
interests of the corporation, except that no indemnification shall be made in
respect to any claim, issue or matter as to which such person shall have been
adjudged to be liable to the corporation unless and only to the extent that the
court determines such person is fairly and reasonably entitled to indemnify for
such expenses.
Insofar as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to directors, officers or persons controlling the Company
pursuant to the foregoing
<PAGE>
22
provisions, the Company understands that in the opinion of the Securities
Exchange Commission, such indemnification is against public policy as expressed
in the Act and is therefore unenforceable.
FINANCIAL STATEMENTS:
1. Report of Independent Certified Public Accountants
dated September 10, 1999
Audited Consolidated Financial Statements:
2. Balance Sheets as at July 31, 1999 and December 31,
1998
3. Statement of Operations for seven months ended July
31, 1999, the period from March 4, 1998 (date of
inception) to December 31, 1998 and the period from
March 4, 1998 to July 31, 1999
4. Statement of Changes in Stockholders' Equity for the
period from March 4, 1998 to July 31, 1999
5. Statement of Cash Flows for the seven months ended
July 31, 1999, the period from March 4, 1998 to
December 31, 1998 and the period from March 4, 1998
to July 31, 1999
6. Notes to Financial Statements
EXHIBITS:
3(i) Articles of Incorporation dated March 4, 1998
together with Amended Articles of Incorporation dated
April 23, 1998
3(ii) By-Laws of the Company dated April 23, 1998
4 See Exhibit 3(ii) for By-Laws
10(a) License Agreement between the Company and 827109
Alberta Ltd. dated June 1, 1999
10(b) License Agreement between SiCom Solutions Inc. and
827109 Alberta Ltd. dated June 1, 1999
10(c) Letter from 827109 Alberta Ltd. to Delta Capital
Technologies Inc. dated September 2, 1999
acknowledging receipt of the $20,000 payment and
granting a three month extension of the $30,000
payment to November 1, 1999
<PAGE>
23
10(d) Letter from SiCom Solutions Inc. to 827109 Alberta
Ltd. dated September 2, 1999 acknowledging receipt of
the $20,000 payment and granting a three month
extension of the $30,000 payment to November 1, 1999
27 Financial Data Schedule
99(a) Share Exchange Agreement between the Company and
827109 Alberta Ltd. dated June 1, 1999
99(b) Stock Option Agreement between the Company and Judith
Miller, Corporate Secretary and Director of the
Company dated September 15, 1999
SIGNATURES
Pursuant to the requirements of Section 12 of the Securities Exchange Act of
1934, the registrant has caused this registration to be signed on its behalf by
the undersigned, thereunder duly authorized, on the ______ day of September
1999.
DELTA CAPITAL TECHNOLOGIES, INC.
Per:
"Paul Davis"
---------------------------------------
Paul Davis
President and Chief Executive Officer
<PAGE>
DELTA CAPITAL TECHNOLOGIES, INC.
FINANCIAL STATEMENTS AND REPORT
OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
JULY 31, 1999 AND DECEMBER 31, 1998
<PAGE>
Board of Directors
Delta Capital Technologies, Inc.
Vancouver, B.C. Canada
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We have audited the accompanying balance sheets of Delta Capital Technologies,
Inc. (a development stage company) at July 31, 1999, and December 31, 1998 and
the statement of operations, stockholders' equity, and cash flows for the seven
months ended July 31, 1999 and the period from March 4, 1998 to December 31,
1998 and the period from March 4, 1998 (date of inception) to July 31, 1999.
These financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements based
on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the over all financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Delta Capital Technologies,
Inc. at July 31, 1999, and December 31, 1998 and the results of operations, and
cash flows for the seven months ended July 31, 1999 and the period from March 4.
1998 to December 31, 1998 and the period from March 4, 1998 (date of inception)
to July 31, 1999, in conformity with generally accepted accounting principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. The Company is in the development
stage and will need additional working capital for its planned activity, which
raises substantial doubt about its ability to continue as a going concern.
Management's plans in regard to these matters are described in Note 7 . These
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.
Salt Lake City, Utah
September 10 , 1999
<PAGE>
DELTA CAPITAL TECHNOLOGIES, INC.
(DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
JULY 31, 1999 AND DECEMBER 31, 1998
<TABLE>
<CAPTION>
=================================================================================================
JULY 31 DEC 31
1999 1998
---- ----
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash $ 1,169 $ 20,926
-------- --------
Total Current Assets 1,169
20,926
PROPERTY AND EQUIPMENT - net of accumulated depreciation 564 --
-------- --------
MARKETING LICENSE - net of amortization - Note 3 11,637 --
-------- --------
$ 13,370 $ 20,926
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Notes payable - Note 4 $ 26,165 $ --
Accounts payable 14,918
-------- --------
Total Current Liabilities
41,083 --
-------- --------
STOCKHOLDERS' EQUITY
Common stock
25,000,000 shares authorized, at $0.001 par value;
8,800,000 shares issued and outstanding - Note 8 8,800 8,800
Capital in excess of par value 51,407 51,407
Deficit accumulated during the development stage (87,920) (39,281)
-------- --------
Total Stockholders' Equity (27,713) 20,926
-------- --------
$ 13,370 $ 20,926
======== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
DELTA CAPITAL TECHNOLOGIES, INC.
(DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATIONS
FOR THE SEVEN MONTHS ENDED JULY 31, 1999 AND THE PERIOD FROM
MARCH 4, 1998 TO DECEMBER 31, 1998 AND THE PERIOD FROM
MARCH 4, 1998 (DATE OF INCEPTION) TO JULY 31, 1999
================================================================================
JUL 31, DEC 31, MAR 4, 1998
1999 1998 TO JUL 31,1999
---- ---- --------------
REVENUES $ -- $ -- $ --
EXPENSES 48,639 39,281 87,920
---------- ---------- --------
NET LOSS $ (48,639) $ (39,281) $(87,920)
========== ========== ========
NET LOSS PER COMMON SHARE
Basic $ -- $ --
---------- ----------
Diluted $ -- $ --
---------- ----------
AVERAGE OUTSTANDING SHARES
Basic 8,800,000 8,800,000
---------- ----------
Diluted 9,000,000 9,000,000
---------- ----------
The accompanying notes are an integral part of these financial statements.
<PAGE>
DELTA CAPITAL TECHNOLOGIES, INC.
(DEVELOPMENT STAGE COMPANY)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE PERIOD FROM MARCH 4, 1998 (DATE OF INCEPTION)
TO JULY 31, 1999
<TABLE>
<CAPTION>
================================================================================================
COMMON STOCK CAPITAL IN
------------------- EXCESS OF ACCUMULATED
SHARES AMOUNT PAR VALUE DEFICIT
------ ------ --------- -------
<S> <C> <C> <C> <C>
BALANCE MARCH 4, 1998 (date of inception) -- $ -- $ -- $ --
Issuance of common stock for services
at $.0002 - March 1998 800,000 800 (593) --
Issuance of common stock for cash
at $.0075 - June 1998 8,000,000 8,000 52,000 --
Net operating loss for the period March 4,
1998 to December 31, 1998 -- -- -- (39,281)
--------- ------ ------- --------
BALANCE DECEMBER 31, 1998 8,800,000 8,800 51,407 (39,281)
Net operating loss for the seven months
ended July 31, 1999 -- -- -- (48,639)
--------- ------ ------- --------
BALANCE JULY 31, 1999 8,800,000 $8,800 $51,407 $(87,920)
========= ======= ======= ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
DELTA CAPITAL TECHNOLOGIES, INC.
(DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOWS
FOR THE SEVEN MONTHS ENDED JULY 31, 1999 AND THE PERIOD FROM
MARCH 4, 1998 TO DECEMBER 31, 1998 AND THE
PERIOD FROM MARCH 4, 1998 (DATE OF INCEPTION) TO JULY 31, 1999
<TABLE>
<CAPTION>
============================================================================================================
JUL 31, DEC 31, MAR 4, 1998
1999 1998 TO JUL 31, 1999
---- ---- ---------------
<S> <C> <C> <C> <C>
CASH FLOWS FROM
OPERATING ACTIVITIES
Net loss (48,639) $ (39,281) $(87,921)
Adjustments to reconcile net loss to
net cash provided by operating
activities
Issuance of common capital stock for expenses -- 207 207
Amortization 1,878 -- 1,878
Changes in accounts payable 15,002 -- 15,002
-------- -------- --------
Net (decrease) in Cash From Operations (31,759) (39,074) (70,834)
-------- -------- --------
CASH FLOWS FROM INVESTING
ACTIVITIES
Purchase of marketing license (13,514) (13,514)
Purchase of office equipment (564) -- (564)
-------- -------- --------
CASH FLOWS FROM FINANCING
ACTIVITIES
Proceeds from loans 26,081 -- 26,081
Proceeds from issuance of common stock -- 60,000 60,000
-------- -------- --------
Net Increase (Decrease) in Cash (19,756) 20,926 1,169
Cash at Beginning of Period 20,925 -- --
-------- -------- --------
Cash at End of Period $ 1,169 $ 20,926 $ 1,169
======== ======== ========
NON CASH OPERATING ACTIVITIES
Issuance of 800,000 shares common capital stock for expenses $ 207
-------
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
DELTA CAPITAL TECHNOLOGIES, INC.
(DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
================================================================================
1. ORGANIZATION
The Company was incorporated under the laws of the State of Delaware on March 4,
1998 with authorized common stock of 25,000,000 shares at $0.001 par value. On
March 15, 1999 the Company completed a forward stock split of four shares for
each outstanding share. This report has been prepared using after stock split
shares from inception.
The Company was organized for the purpose of the acquisition of a license to
market a software computer program. See note 3.
The Company is in the development stage.
Since its inception the Company has completed a Regulation D offering of
8,000,000 after stock split shares of its capital stock for cash of $60,000.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Accounting Methods
The Company recognizes income and expenses based on the accrual method of
accounting.
Dividend Policy
The Company has not yet adopted a policy regarding payment of dividends.
Income Taxes
On December 31, 1998, the Company had a net operating loss carry forward of
$39,281. The tax benefit from the loss carry forward has been fully offset by a
valuation reserve because the use of the future tax benefit is doubtful, since
the Company has no operations on which to project future net profits.
The loss carryforward will expire in the year 2019.
Earnings (Loss) Per Share
Earnings (loss) per share amounts are computed based on the weighted average
number of shares actually outstanding in accordance with FASB No. 128.
Cash and Cash Equivalents
The Company considers all highly liquid instruments purchased with a maturity,
at the time of purchase, of less than three months, to be cash equivalents.
<PAGE>
DELTA CAPITAL TECHNOLOGIES, INC.
(DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
Foreign Currency Translation
Part of the transactions of the Company were completed in Canadian dollars and
have been translated to US dollars as incurred, at the exchange rate in effect
at the time, and therefore, no gain or loss from the translations is recognized.
Amortization of a Capitalized Marketing License
The Company amortizes the marketing license over its estimated useful life of
three years. Any remaining unamortized capitalized costs will be expensed if it
is shown to have an impairment in value or proven to be of no value. All royalty
payments will be expensed. See Note 3.
Financial Instruments
The carrying amounts of financial instruments, including cash, equipment,
marketing license, and accounts payable, are considered by management to be
their estimated fair values. These values are not necessarily indicative of the
amounts that the Company could realize in a current market exchange.
Estimates and Assumptions
Management uses estimates and assumptions in preparing financial statements in
accordance with generally accepted accounting principles. Those estimates and
assumptions affect the reported amounts of the assets and liabilities, the
disclosure of contingent assets and liabilities, and the reported revenues and
expenses. Actual results could vary from the estimates that were assumed in
preparing these financial statements.
3. PURCHASE OF MARKETING LICENSE
On June 1, 1999 the Company acquired a world wide license to market computer
software known as relBuilder.e-suite of e-business software from 827109 Alberta
LTD.(a Canadian corporation). The software is used in various business fields to
aid in the development of internet businesses and technologies which provides
for competitive shopping, mazimizing re-use of corporate information by bringing
together data which is usually scattered across many systems.
The terms of the agreement is for three years and includes an intitial payment
of $50,000 cn which is due anytime before November 1, 1999, of which $20,000cn
has been paid, and royalty payments of 15% of the net sales with a minimum
amount of $50,000 cn for the first year and $200,000 cn for the second year and
$300,000cn for the third year. The agreement can be cancelled by notice after a
30 day default by either party or automatically terminates if any royalty
payment is more than 60 days past due. The agreement can be renewed at the end
of three years for an unlimited time by the payment of $1cn.
<PAGE>
DELTA CAPITAL TECHNOLOGIES, INC.
(DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
3. PURCHASE OF MARKETING LICENSE - continued
The amounts paid and to be paid toward the purchase price of $50,000cn are
capitalized and amortized over 3 years, at the rate of $16,667cn each year, the
estimated useful life of the license, or a shorter period if the value of the
license is determined to be impaired.
All of the parties to the agreement have certain common officers and they
believe the contract amount of $50,000cn for the purchase of the license is a
fair value.
At the report date the Company did not have the working capital necessary to
begin the marketing activity.
4. NOTES PAYABLE
The Company has the following short term notes payable outstanding.
Name Date of Note Term Interest Amount
---- ------------ ---- -------- ------
Smart Communications Inc. June 30, 1999 one year 6% 20,000
Bonanza Management July 31, 1999 90 days 12% 6,081
5. STOCK OPTIONS
On August 26, 1998 the Company issued stock options to purchase 200,000 common
shares to an officer at .0075 per share which will expire December 31, 1999. The
options were given as compensation for prior services and on the option date
were considered to have no fair value.
6. RELATED PARTY TRANSACTIONS
Related parties have acquired 28 % of the common stock issued.
The Company purchased the maketing license outlined in note 3 from related
parties.
<PAGE>
DELTA CAPITAL TECHNOLOGIES, INC.
(DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
7. GOING CONCERN
The Company will need additional working capital to be successful in its planned
activity and to service its current debt for the coming year and therefore
continuation of the Company as a going concern is dependent upon obtaining the
additional working capital necessary to accomplish its objective. Management has
developed a strategy, which it believes will accomplish this objective and is
presently engaged in seeking various sources of additional working capital
including equity funding through a private placement, long term financing, and
completion of negotiations to access development and marketing support from a
major hardware/sofware company which has a program designed to further
e-Commerce and e-Business ventures, and increased revenues from sales which will
enable the Company to operate for the coming year.
The accompanying financial statements do not include any adjustments to the
recorded assets or liabilities that might be necessary should the Company fail
in any of above objectives and is unable to operate for the coming year.
8. SUBSEQUENT EVENTS
On September 9, 1999 the Company acquired 36% of the outstanding stock of 827109
Alberta LTD (a Canadian corporation) by the issuance of 5,000,000 common shares
of the Company. The only asset held by 827109 Alberta LTD is the rights to the
computer software outlined in note 3 and is reported in their financial
statements with no value.
On September 9, 1999 the company issued 300,000 common shares of its stock for
the exclusive rights to the trade names "Clear Choice Media and "Clear Choice
Technologies"
After the completion of the above stock issues the outstanding stock of the
Company amounted to 14,100,000 shares.
<PAGE>
24
INDEX TO EXHIBITS
EXHIBIT DESCRIPTION
3(i) Articles of Incorporation dated March 4, 1998
together with Amended Articles of Incorporation dated
April 23, 1998
3(ii) By-Laws of the Company dated April 23, 1998
4 See Exhibit 3(ii) for By-Laws
10(a) License Agreement between the Company and 827109
Alberta Ltd. dated June 1, 1999
10(b) License Agreement between SiCom Solutions Inc. and
827109 Alberta Ltd. dated June 1, 1999
10(c) Letter from 827109 Alberta Ltd. to Delta Capital
Technologies Inc. dated September 2, 1999
acknowledging receipt of the $20,000 payment and
granting a three month extension of the $30,000
payment to November 1, 1999
10(d) Letter from SiCom Solutions Inc. to 827109 Alberta
Ltd. dated September 2, 1999 acknowledging receipt of
the $20,000 payment and granting a three month
extension of the $30,000 payment to November 1, 1999
27 Financial Data Schedule
99(a) Share Exchange Agreement between the Company and
827109 Alberta Ltd. dated June 1, 1999
99(b) Stock Option Agreement between the Company and Judith
Miller, Corporate Secretary and Director of the
Company dated September 15, 1999
EXHIBIT 3(i)
CERTIFICATE OF INCORPORATION
OF
DELTA CAPITAL TECHNOLOGIES INC.
A CLOSE CORPORATION
FIRST: The name of this corporation is Delta Capital Technologies, Inc.
SECOND: Its registered office in the State of Delaware is to be located at 1313
N. Market St., Wilmington, DE 19801-1151, County of New Castle. The registered
agent in charge thereof is The Company Corporation, address "same as above".
THIRD: The nature of the business and the objects and purposes proposed to be
transacted, promoted and carried on, are to engage in any lawful act or activity
for which corporations may be organized under the General Corporation law of
Delaware.
FOURTH: The amount of total authorized shares of stock of this corporation is
1,500 shares of No par value.
FIFTH: The name and mailing address of the incorporator is: Regina Cephas, 1313
N, Market St., Wilmington, DE 19801-1151.
SIXTH: All of the corporation's issued stock, exclusive of treasury shares,
shall be represented by certificates and shall be held of record by not more
than thirty (30) persons.
SEVENTH: All of the issued stock of all classes shall be subject to one or more
of the restriction on transfer permitted by Section 202 of the General
Corporation Law.
EIGHTH: The corporation shall make no offering of any of its stock of any class
which would constitute a "public offering" within the meaning of the United
States Securities Act of 1933 as it may be amended from time to time.
NINTH: Directors of the corporation shall not be liable to either the
corporation or its stockholders for monetary damages for a breach of fiduciary
duties unless the breach involves: (1) a director's duty of loyalty to the
corporation or its stockholders; (2) acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law; (3)
liability for unlawful payments of dividends or unlawful stock purchases or
redemption by the corporation; or (4) a transaction from which the director
derived an improper personal benefit.
I, THE UNDERSIGNED, for the purpose of forming a corporation under the laws of
the State of Delaware, do make, file and record this Certificate and do certify
that the facts are true, and I have accordingly, hereunder set my hand.
DATED: MARCH 4, 1998
"Regina Cephas"
---------------------------
Regina Cephas
<PAGE>
DELTA CAPITAL TECHNOLOGIES, INC.
DELTA CAPITAL TECHNOLOGIES, INC. a corporation organized and existing under and
by virtue of the General Corporation Law of the State of Delaware, DOES HEREBY
CERTIFY:
FIRST. That a Certificate of Incorporation of DELTA CAPITAL
TECHNOLOGIES, INC. properly executed , was filed with the Secretary of State of
Delaware on March 4, 1998, in good faith and with all belief that such
incorporation was accurate and correct.
SECOND. That the Certificate of Incorporation was filed as a Close
Corporation in error and all reference to a Close Corporation should be deleted.
In addition, the stock in Article Fourth and the incorporator's name and address
in Article Fifth are being corrected.
THIRD. That the Certificate of Incorporation should be corrected to
read in its entirety as follows in attached Exhibit A.
IN WITNESS WHEREOF, said corporation has caused this Certificate to be
signed by its Authorized Officer this 23rd day April, A.D., 1998.
"Tim Delaney"
---------------------------
Authorized Signatory
Tim Delaney
<PAGE>
Exhibit A
CERTIFICATE OF INCORPORATION
OF
DELTA CAPITAL TECHNOLOGIES INC.
A CLOSE CORPORATION
FIRST: The name of this corporation is Delta Capital Technologies, Inc.
SECOND: Its registered office in the State of Delaware is to be located at 1013
Centre Rd., Wilmington, DE 19805, County of New Castle. The registered agent in
charge thereof is The Company Corporation, address "same as above".
THIRD: The nature of the business and the objects and purposes proposed to be
transacted, promoted and carried on, are to engage in any lawful act or activity
for which corporations may be organized under the General Corporation law of
Delaware.
FOURTH: The amount of total authorized shares of stock of this corporation is
25,000,000 shares of $0.001.
FIFTH: The name and mailing address of the incorporator is: Kathleen Crowley,
1013 Centre Rd., Wilmington, DE 19805.
SIXTH: The Directors shall have the power to make or amend the By-laws; to afix
the amount to be reserved as working capital, and to authorize and cause to be
executed, mortgages and liens without limit as to the amount, upon the property
and franchise of the Corporation.
And with the consent in writing and pursuant to a vote of the
holders of a majority of the capital stock issued and outstanding, the Directors
shall have the authority to dispose, in any manner, of the whole property of the
corporation.
The By-Laws shall determine whether and to what extent the
accounts and books of this corporation, or any of them shall be open for
inspection of the stockholders; and no stockholder shall have any right of
inspecting any account, or book or document of this corporation, except as
conferred by the law or the By-Laws, or by resolution of the Stockholders.
The Stockholders and directors shall have the power to hold
their meetings and keep the books, documents, and papers of the Corporation
outside the State of Delaware, or at such places as may be from time to time
designated by the By-Laws or by resolution of the stock holders or directors,
except as otherwise required by the laws of Delaware.
It is the intention that the objects, purposes and powers
specified in the Third paragraph hereof shall, except where otherwise specified
in said paragraph, be nowise limited or restricted by reference to or inference
from the terms of any other clause or paragraph in this certificate of
incorporation, that the objects, purposes and powers specified in the Third
paragraph and in each of the clauses or paragraphs of this charter shall be
regarded as independent objects, purposes and powers.
SEVENTH: Directors of the corporation shall not be liable to either the
corporation or its stockholders for monetary damages for a breach of fiduciary
duties unless the breach involves: (1) a director's duty of loyalty to the
corporation or its stockholders; (2) acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law; (3)
liability for unlawful payments of dividends or unlawful stock purchases or
redemption by the corporation; or (4) a transaction from which the director
derived an improper personal benefit.
IN WITNESS WHEREOF, The undersigned, being the incorporator
hereinbefore named, has executed, signed and acknowledged this certificate of
incorporation this 27 day of April, A.D. 1998
"Kathleen Crowley"
---------------------------
Kathleen Crowley
Incorporator
EXHIBIT 3(ii)
BYLAWS
OF
DELTA CAPITAL TECHNOLOGIES, INC.
(a Delaware corporation)
ARTICLE I
STOCKHOLDERS
1. CERTFICATES REPRESENTING STOCK Certificates representing stock in
the corporation shall be signed by, or in the name of, the corporation by the
Chairman or Vice-Chairman of the Board of Directors, if any, or by the President
or a Vice-President and by the Treasurer a an Assistant Treasurer or the
Secretary a an Assistant Secretary of the corporation. Any or all the signatures
on any such certificate may be a facsimile In case any officer, transfer agent,
or registrar who has signed or whose facsimile signature has been placed apart a
certificate shall have ceased to be such officer, transfer agent, or registrar
before such certificate is issued, it may be issued by the corporation with the
same effect as if he were such officer, transfer agent or registrar at the date
of issue.
Whenever the corporation shall be authorized to issue more than one
class of stock or more than one series of any class of stock, and whenever the
corporation shall issue any shares of its stock as partly paid stock, the
certificates representing shares of any such class or series or of any such
partly paid stock shall set forth thereon the statements prescribed by the
General Corporation Law. Any restrictions on the transfer or registration of
transfer of any shares of stock of any class or series shall be noted
conspicuously on the certificate representing such shares.
The corporation may issue a new certificate of stock or uncertified
shares in place of any certificate theretofore issued by it, alleged to have
been lost, stolen, or destroyed, and the Board of Directors may require the
owner of the lost, stolen, or destroyed certificate, or his legal
representative, to give the corporation a bond sufficient to indemnify the
corporation against any claim that may be made against it on account of the
alleged loss, theft, or destruction of any such certificate are or the issuance
of any such new certificate or uncertificated shares.
2. UNCERTIFICATED SHARES. Subject to any conditions imposed by the
General Corporation Law, the Board of Directors of the corporation may provide
by resolution or resolutions that some or all of any or all classes or series of
the stock of the corporation shall be uncertificated shares. Within a reasonable
time after the issuance or transfer of any uncertificated shares, the
corporation shall send to the registered owner thereof any written notice
prescribed by the General Corporation Law.
3. FRACTIONAL SHARE INTERESTS. The corporation may, but shall not be
required to, issue fractions of a share. If the corporation does not issue
fractions of a share, it shall (1) arrange for the disposition of fractional
interests by those entitled thereto, (2) pay in cash the fair value of fractions
of a share as of the time when those entitled to receive such fractions
<PAGE>
are determined, or (3) issue scrip or warrants in registered form (either
represented by a certificate or uncertificated) or bearer form (represented by a
certificate) which shall entitle the holder to receive a full share upon the
surrender of such scrip or warrants aggregating a full share. A certificate for
a fractional share or an uncertificated fractional share shall, but scrip or
warrants shall not unless otherwise provided therein, entitle the holder to
exercise voting rights, to receive dividends thereon, and to participate in any
of the assets of the corporation in the evenf liquidation. The Board of
Directors may cause scrip or warrants to be issued subject to the conditions
that they shall become void if not exchanged for certificates representing the
full shares or uncertificated full shares before specified date, or subject to
the conditions that the shares for which scrip or warrants are exchangeable may
be sold by the corporation and the proceeds thereof distributed to the holders
of scrip or warrants, or subject to any other conditions which the Board of
Directors may impose.
4. STOCK TRANSFERS. Upon compliance with provisions restricting the
transfer or registration of transfer of shares of stock, if any, transfers or
registration of transfers of shares of stock of the corporation shall be made
only on the stock ledger of the corporation by the registered holder thereof, a
by his attorney thereunto authorized by power of attorney duly executed and
filed with the Secretary of the corporation or with a transfer agent or a
registrar, if any, and, in the case of shares represented by certificates, on
surrender of the certificate or certificates for such shares of stock properly
endorsed and the payment of all taxes due thereon.
5. RECORD DATE STOCKHOLDERS. In order that the corporation may
determine the stockholders entitled to notice of or to vote at any meeting of
stockholders or any adjournment thereof. The Board of Directors may fix a record
date, which record date shall not precede the date upon which the resolution
fixing the record date is adopted by the Board of Directors, and which record
date shall not be more than sixty nor less than ten days before the date of such
meeting. If no record date is fixed by the Board of Directors, the record date
for determining stockholders entitled to notice of or to vote at a meeting of
stockholders shall be at the close of business on the day next preceding the day
on which notice is given, or, if notice is waived, at the close of business on
the day next preceding the day on which the meeting is held. A determination of
stockholders of record entitled to notice of or to vote at a meeting of
stockholders shall apply to any adjournment of the meeting; provided, however,
that the Board of Directors may fix a new record date for the adjourned meeting
in order that the corporation may determine the stockholders entitled to consent
to corporate action in writing without a meeting, the Board of Directors may fix
a record date, which record date shall not precede the date upon which the
resolution fixing the record date is adopted by the Board of Directors, and
which date shall not be more than ten days after the date upon which the
resolution fixing the record date is adopted by the Board Of Directors. If no
record date has been fixed by the Board of Directors, the record date for
<PAGE>
the stockholders entitled to consent to corporate action in writing without a
meeting, when no prior action by the Board of Directors is required by the
General Corporation Law, shall be the first date on which a signed written
consent setting forth the action taken or proposed to be taken is delivered to
the corporation by delivery to its registered office in the State of Delaware,
its principal place of business, or an officer or agent of the corporation
having custody of the book in which proceedings of meetings of stockholders are
recorded. Delivery made to the corporation's registered office shall be by hand
or by certified or registered mail, return receipt requested. If no record date
has been fixed by the Board of Directors and prior action by the Board of
Directors is required by the General Corporation Law, the record date for
determining stockholders entitled to consent to corporate action in writing
without a meeting shall be at the close of business on the day on which the
Board of Directors adopts the resolution taking such prior action. In order that
the corporation may determine the stockholders entitled to receive payment of
any dividend or other distribution or allotment of any rights or the
stockholders entitled to exercise any rights in respect of any change,
conversion, or exchange of stock, or for the purpose of any other lawful action,
the Board of Directors may fix a record date, which record date shall not
precede the date upon which the resolution fixing the record date is adopted and
which record date shall be not more than sixty days prior to such action. If no
record date is fixed, the record date for determining stockholders for any such
purpose shall be at the close of business on the day on which the Board of
Directors adopts the resolution relating thereto.
6. MEANING OF CERTAIN TERMS. As used herein in respect of the right to
notice of a meeting of stockholders or a waiver thereof or to participate or
vote thereat or to consent or dissent in writing in lieu of a meeting, as the
case may be, the term "share" or "shares" or "share of stock" or "shares of
stock" or "stockholder" or "stockholders" refers to an outstanding share or
shares of stock and to a holder or holders of record of outstanding shares of
stock when the corporation is authorized to issue only one class of shares of
stock and said reference is also intended to include any outstanding share or
shares of stock and any holder or holders of record of outstanding shares of
stock of any class upon which or upon whom the certificate of incorporation
confers such rights where there are two or more classes or series of shares of
stock or upon which a upon whom the General Corporation Law confers such rights
notwithstanding that the certificate of incorporation may provide for more than
one class or series of shares of stock, one a more of which are limited or
denied such rights thereunder; provided, however, that no such right shall vest
in the event of an increase or a decrease in the authorized number of shares of
stock of any class or series which is otherwise denied voting rights under the
provisions of the certificate of incorporation, except as any provision of law
may otherwise require.
7. STOCKHOLDER MEETINGS.
-TIME. The annual meeting shall be held on the date and at the time
fixed, from time to time, by the directors, provided, that the first annual
meeting shall be held on a date within time months after the organization of the
corporation, and each successive annual meeting shall be held on a date within
thirteen months after the date of the preceding annual meeting. A special
meeting shall be held on the date and at the time fixed by the directors.
- PLACE. Annual meetings and special meetings shall be held at such
place, within or without the State of Delaware, as the directors may, from time
to time, fix. Whenever the directors shall fail to fix such place, the meeting
shall be held at the registered office of the Corporation in the State of
Delaware.
- CALL. Annual meetings and special meetings may be called by the
directors or by any officer instructed by the directors to call the meeting.
- NOTICE OR WAIVER OF NOTICE. Written notice of all meetings shall be
given, stating the place, date, and hour of the meeting and stating the place
within the city or other municipality or community at which the list of
stockholders of the corporation may be examined. The notice of an annual meeting
shall state that the meeting is called for the
<PAGE>
election of directors and for the transaction of other business which may
properly come before the meeting, and shall (if any other action which could be
taken at a special meeting is to be taken at such annual meeting) state the
purpose or purposes. The notice of a special meeting shall in all instances
state the purpose or purposes for which the meeting is called. The notice of any
meeting shall also include, or be accompanied by, any additional statements,
information, or documents prescribed by the General Corporation Law. Except as
otherwise provided by the General Corporation Law, a copy of the notice of any
meeting shall be given personally or by mail, not less than ten days nor more
than sixty days before the date of the meeting, unless the lapse of the
prescribed period of time shall have been waived, and directed to each
stockholder at his record address or at such other address which he may have
furnished by request in writing to the Secretary of the corporation. Notice by
mail shall be deemed to be given when deposited, with postage thereon prepaid,
in the United States Mail. If a meeting is adjourned to another time, not more
than thirty days hence, and/or to another place, and if an announcement of the
adjourned time and/or place is made at the meeting, it shall not be necessary to
give notice of the adjourned meeting unless the directors, after adjournment,
fix a new record date for the adjourned meeting. Notice need not be given to any
stockholder who submits a written waiver of notice signed by him before or after
the time stated therein. Attendance of a stockholder at a meeting of
stockholders shall constitute a waiver of notice of such meeting, except when
the stockholder attends the meeting for the express purpose of objecting, at the
beginning of the meeting, to the transaction of any business because the meeting
is not lawfully called or convened. Neither the business to be transacted at,
nor the purpose of, any regular or special meeting of the stockholders need be
specified in any written waiver of notice.
- STOCKHOLDER LIST. The officer who has charge of the stock ledger of
the corporation shall prepare and make, at least ten days before every meeting
of stockholders, a complete list of the stockholders, arranged in alphabetical
order, and showing the address of each stockholder and the number of shares
registered in the name of each stockholder. Such list shall be open to the
examination of any stockholder, for any purpose germane to the meeting, during
ordinary business hours, for a period of at least ten days prior to the meeting,
either at a place within the city or other municipality or community where the
meeting is to be held, which place shall be specified in the notice of the
meeting, or if not so specified, at the place where the meeting is to be held.
The list shall also be produced and kept at the time and place of the meeting
during the whole time thereof, and may be inspected by any stockholder who is
present. The stock ledger shall be the only evidence as to who are the
stockholders entitled to examine the stock ledger, the list required by this
section or the books of the corporation, or to vote at any meeting of
stockholders.
- CONDUCT OF MEETING. Meetings of the stockholders shall be presided
over by one of the following officers in the order of seniority and if present
and acting - the Chairman of the Board, if any, the Vice-Chairman of the Board,
if any, the President, a Vice-President, or, if none of the foregoing is in
office and present and acting, by a chairman to be chosen by the stockholders.
The Secretary of the corporation, or in his absence, an Assistant Secretary,
shall act as secretary of every meeting, but if neither the Secretary nor an
Assistant Secretary is present the Chairman of the meeting shall appoint a
secretary of the meeting.
- PROXY REPRESENTATION. Every stockholder may authorize another person
or persons to act for him by proxy in all matters in which a stockholder is
entitled to participate, whether by waiving notice of any meeting, voting or
participating at a meeting, or
<PAGE>
expressing consent a dissent without a meeting. Every proxy must be signed by
the stockholder or by his attorney-in-fact. No proxy shall be voted or acted
upon after three years from its date unless such proxy provides for a longer
period. A duly executed Proxy shall be irrevocable if it states that it is
irrevocable and, if, and only as long as, it is coupled with an interest
sufficient in law to support an irrevocable power. A proxy may be made
irrevocable regardless of whether the interest with which it is coupled is an
interest in the stock itself or an interest in the corporation generally.
- INSPECTORS. The directors, in advance of any meeting, may, but need
not, appoint one or more inspectors of election to act at the meeting or any
adjournment thereof. If an inspector or inspectors are not appointed, the person
presiding at the meeting may, but need not, appoint one or more inspectors. In
case any person who may be appointed as an inspector fails to appear or act, the
vacancy may be filled by appointment made by the directors in advance of the
meeting or at the meeting by the person presiding thereat. Each inspector, if
any, before entering upon the discharge of his duties, shall take and sign an
oath faithfully to execute the duties of inspectors at such meeting with strict
impartiality and according to the best of his ability. The inspectors, if any,
shall determine the number of shares of stock outstanding and the voting power
of each, the shares of stock represented at the meeting, the existence of a
quorum, the validity and effect of proxies, and shall receive votes, ballots, or
consents, hear and determine all challenges and questions arising in connection
with the right to vote, count and tabulate all votes, ballots, or consents,
determine the result, and do such acts as are proper to conduct the election or
vote with fairness to all stockholders. On request of the person presiding at
the meeting, the inspector or inspectors, if any, shall make a report in writing
of any challenge, question, or matter determined by him or them and execute a
certificate of any fact found by him or them. Except as otherwise required by
subsection (e) of Section 231 of the Corporation Law, the provisions of that
Section shall not apply to the corporation.
- QUORUM. The holders of a majority of the outstanding shares of stock
shall constitute a quorum at a meeting of stockholders for the transaction of
any business. The stockholders present may adjourn the meeting despite the
absence of a quorum.
- VOTING. Each share of stock shall entitle the holder thereof to one
vote. Directors shall be elected by a plurality of the votes of the shares
present in person or represented by proxy at the meeting and entitled to vote on
the election of directors. Any other action shall be authorized by a majority of
the votes cast except where the General Corporation Law prescribes a different
percentage of votes and/or a different exercise of voting power, and except as
may be otherwise prescribed by the provisions of the certificate of
incorporation and these Bylaws. In the election of directors, and for any other
action, voting need not be by ballot.
8. STOCKHOLDER ACTION WITHOUT MEETINGS. Except as any provision of the
General Corporation Law may otherwise require, any action required by the
General Corporation Law to be taken at any annual or special meeting of
stockholders, or any action which may be taken at any annual or special meeting
of stockholders, may be taken without a meeting, without prior notice and
without a vote, if a consent in writing, setting forth the action so taken,
shall be signed by the holders of outstanding stock having not less than the
minimum number of votes that would be necessary to authorize or take such action
at a meeting at which all shares entitled to vote thereon were present and
voted. Prompt notice of
<PAGE>
the taking of the corporate action without a meeting by less than unanimous
written consent shall be given to those stockholders who have not consented in
writing. Action taken pursuant to this paragraph shall be subject to the
provisions of Section 228 of the General' Corporation Law.
ARTICLE II
DIRECTORS
1. FUNCTIONS AND DEFINITION. The business and affairs of the
corporation shall be managed by or under the direction of the Board of Directors
of the corporation. The Board of Directors shall have the authority to fix the
compensation of the members thereof. The use of the phrase "whole board" herein
refers to the total number of directors which the corporation would have if
there were no vacancies.
2. QUALIFICATIONS AND NUMBER. A director need not be a stockholder, a
citizen of the United States, or a resident of the State of Delaware. The
initial Board of Directors shall consist of (one) 1 persons. Thereafter the
number of directors constituting the whole board shall be at least one. Subject
to the foregoing limitation and except for the first Board of Directors, such
number may be fixed from time to time by action of the stockholders or of the
directors, or, if the number is not fixed, the number shall be one (1). The
number of directors may be increased or decreased by action of the stockholders
or of the directors.
3. ELECTION AND TERM. The first Board of Directors, unless the members
thereof shall have been named in the certificate of incorporation, shall be
elected by the incorporator or incorporators and shall hold office until the
first annual meeting of stockholders and until their successors are elected and
qualified or until their earlier resignation or removal. Any director may resign
at any time upon written notice to the corporation. Thereafter, directors who
are elected at an annual meeting of stockholders, and directors who are elected
in the interim to fill vacancies and newly created directorships, shall hold
office until the next annual meeting of stockholders and until their successors
are elected and qualified or until their earlier resignation or removal. Except
as the General Corporation Law may otherwise require, in the interim between
annual meetings of stockholders or of special meetings of stockholders called
for the election of directors and/or for the removal of one or more directors
and for the filling of any vacancy in that connection, newly created
directorships and any vacancies in the Board of Directors, including unfilled
vacancies resulting from the removal of directors for cause or without cause,
may be filled by the vote of a majority of the remaining directors then in
office, although less than a quorum, or by the sole remaining director.
4. MEETINGS.
- TIME. Meetings shall be held at such time as the Board shall fix,
except that the first meeting of a newly elected Board shall be held as soon
after its election as the directors may conveniently assemble.
- PLACE. Meetings shall be held at such place within or without the
State of Delaware as shall be affixed by the Board.
<PAGE>
- Call. No call shall be required for regular meetings for which the
time and place have been fixed. Special meetings may be called by or at the
direction of the Chairman of the Board, if any, the Vice-Chairman of the Board,
if any, of the President, or of a majority of the directors in office.
- NOTICE OR ACTUAL OR CONSTRUCTIVE WAIVER. No notice shall be
required for regular meetings for which the time and place have been fixed.
Written, oral, or any other mode of notice of the time and place shall be given
for special meetings in sufficient time for the convenient assembly of the
directors thereat. Notice need not be given to any director or to any member of
a committee of directors who submits a written waiver of notice signed by him
before or after the time stated therein. Attendance of any such person at a
meeting shall constitute a waiver of notice of such meeting, except when he
attends a meeting for the express purpose of objecting, at the beginning of the
meeting, to the transaction of any business because the meeting is not lawfully
called or convened. Neither the business to be transacted at, nor the purpose
of, any regular or special meeting of the directors need be specified in any
written waiver of notice.
- QUORUM AND ACTION. A majority of the whole board shall constitute a
quorum except when a vacancy or vacancies prevents such majority, whereupon a
majority of the directors in office shall constitute a quorum, provided, that
such majority shall constitute at least one-third of the whole Board. A majority
of the directors present, whether or not a quorum is present, may adjourn a
meeting to another time and place Except as herein otherwise provided, and
except as otherwise provided by the General Corporation Law, the vote of the
majority of the directors present at a meeting at which a quorum is present
shall be the act of the Board. The quorum and voting provisions herein suited
shall not be construed as conflicting with any provisions of the General
Corporation Law and these Bylaws which govern a meeting of directors held to
fill vacancies and newly created directorships in the board or action of
disinterested directors.
Any member or members of the Board of Directors or of any committee
designated by the Board, may participate in a meeting of the Board, or any such
committee, as the case may be, by means of conference telephone or similar
communications equipment by means of which all Persons participating in the
meeting can hear each other.
- CHAIRMAN OF THE MEETING. The Chairman of the Board, if any and if
present and acting, shall preside at all meetings. Otherwise, the vice-chairman
of the Board, if any and if present and acting, or the President, if present and
acting, or any other director chosen by the Board, shall preside.
5. REMOVAL OF DIRECTORS. Except as may otherwise be provided by the
General Corporation Law, any director or the entire Board of Directors may be
removed, with or without cause, by the holders of a majority of the shares then
entitled to vote at an election of directors.
6. COMMITTEES. The Board of Directors may designate one or more
committees, each committee to consist of one or more of the directors of the
corporation. The Board may designate one or more directors as alternate members
of any committee, who may replace any absent or disqualified member at any
meeting of the committee. In the absence or disqualification of any member of
any such committee or committees, the member or
<PAGE>
members thereof present at any meeting and not disqualified from voting, whether
or not such member or members constitute a quorum, may unanimously appoint
another member of the Board of Directors to act at the meeting in the place of
any such absent or disqualified member. Any such committee, to the extent
provided in the resolution of the Board, shall have and may exercise the powers
and authority of the Board of Directors in the management of the business and
affairs of the corporation with the exception of any authority the delegation of
which is prohibited by Section 141 of the General Corporation Law, and may
authorize the seal of the corporation to be affixed to alt papers which may
require it.
7- WRITTEN ACTION. Any action required or permitted to be taken at any
meeting of the Board of Directors or any committee thereof may be taken without
a meeting if all members of the Board or committee, as the case may be, consent
thereto in writing, and the writing or writings are filed with the minutes of
proceedings of the Board or committee.
ARTICLE III
OFFICERS
The officers of the corporation shall consist of a President, a
Secretary, a Treasurer, and, if deemed necessary, expedient, or desirable by the
Board of Directors, a Chairman of the Board, a Vice-Chairman of the Board, an
Executive Vice-President, one or more other Vice-Presidents, one or more
Assistant Secretaries, one or more Assistant Treasurers, and such other officers
with such tides as the resolution of the Board of Directors choosing them shall
designate. Except as may otherwise be provided in the resolution of the Board of
Directors choosing him, no officer other than the Chairman or Vice-Chairman of
the Board, if any, need be a director. Any number of offices may be held by the
same person, as the directors may determine.
Unless otherwise provided in the resolution choosing him, each officer
shall be chosen for a term which shall continue until the meeting of the Board
of Directors following the next annual meeting of stockholders and until his
successor shall have been chosen and qualified.
All officers of the corporation shall have such authority and perform
such duties in the management and operation of the corporation as shall be
prescribed in the resolutions of the Board of Directors designating and choosing
such officers and prescribing their authority and duties, and shall have such
additional authority and duties as are incident to their office except to the
extent that such resolutions may be inconsistent therewith The Secretary or an
Assistant Secretary of the corporation shall record all of the proceedings of
all meetings and actions in writing of stockholders, directors, and committees
of directors, and shall exercise such additional authority and perform snob
additional duties as the board shall assign to him. Any officer may e removed,
with or without cause, by the Board of Directors.
Any vacancy in any office may be filled by the Board of Directors.
ARTICLE IV
CORPORATE SEAL
The corporate seal shall be in such form as the Board of Directors
shall prescribe.
<PAGE>
ARTICLE V
FISCAL YEAR
The fiscal year of the corporation shall be fixed, and shall be subject
to change, by the Board of Directors.
ARTICLE VI
CONTROL OVER BYLAWS
Subject to the provisions of the certificate of incorporation and the
provisions of Corporation Law, the power to amend, alter, or repeal these Bylaws
and to adopt new bylaws may be exercised by the Board of Directors or by the
stockholders.
I HEREBY CERTIFY that the foregoing is a full, true, and correct copy
of the Bylaws of Delta Capital Technologies, Inc. a Delaware corporation, as in
effect on the date hereof.
Dated this 23rd day of April, 1998
"Timothy Delaney"
------------------------------------------
Secretary, Delta Capital Technologies, Inc
(SEAL)
EXHIBIT 4
BYLAWS
OF
DELTA CAPITAL TECHNOLOGIES, INC.
(a Delaware corporation)
ARTICLE I
STOCKHOLDERS
1. CERTFICATES REPRESENTING STOCK Certificates representing stock in
the corporation shall be signed by, or in the name of, the corporation by the
Chairman or Vice-Chairman of the Board of Directors, if any, or by the President
or a Vice-President and by the Treasurer a an Assistant Treasurer or the
Secretary a an Assistant Secretary of the corporation. Any or all the signatures
on any such certificate may be a facsimile In case any officer, transfer agent,
or registrar who has signed or whose facsimile signature has been placed apart a
certificate shall have ceased to be such officer, transfer agent, or registrar
before such certificate is issued, it may be issued by the corporation with the
same effect as if he were such officer, transfer agent or registrar at the date
of issue.
Whenever the corporation shall be authorized to issue more than one
class of stock or more than one series of any class of stock, and whenever the
corporation shall issue any shares of its stock as partly paid stock, the
certificates representing shares of any such class or series or of any such
partly paid stock shall set forth thereon the statements prescribed by the
General Corporation Law. Any restrictions on the transfer or registration of
transfer of any shares of stock of any class or series shall be noted
conspicuously on the certificate representing such shares.
The corporation may issue a new certificate of stock or uncertified
shares in place of any certificate theretofore issued by it, alleged to have
been lost, stolen, or destroyed, and the Board of Directors may require the
owner of the lost, stolen, or destroyed certificate, or his legal
representative, to give the corporation a bond sufficient to indemnify the
corporation against any claim that may be made against it on account of the
alleged loss, theft, or destruction of any such certificate are or the issuance
of any such new certificate or uncertificated shares.
2. UNCERTIFICATED SHARES. Subject to any conditions imposed by the
General Corporation Law, the Board of Directors of the corporation may provide
by resolution or resolutions that some or all of any or all classes or series of
the stock of the corporation shall be uncertificated shares. Within a reasonable
time after the issuance or transfer of any uncertificated shares, the
corporation shall send to the registered owner thereof any written notice
prescribed by the General Corporation Law.
3. FRACTIONAL SHARE INTERESTS. The corporation may, but shall not be
required to, issue fractions of a share. If the corporation does not issue
fractions of a share, it shall (1) arrange for the disposition of fractional
interests by those entitled thereto, (2) pay in cash the fair value of fractions
of a share as of the time when those entitled to receive such
<PAGE>
fractions are determined, or (3) issue scrip or warrants in registered form
(either represented by a certificate or uncertificated) or bearer form
(represented by a certificate) which shall entitle the holder to receive a full
share upon the surrender of such scrip or warrants aggregating a full share. A
certificate for a fractional share or an uncertificated fractional share shall,
but scrip or warrants shall not unless otherwise provided therein, entitle the
holder to exercise voting rights, to receive dividends thereon, and to
participate in any of the assets of the corporation in the event of liquidation.
The Board of Directors may cause scrip or warrants to be issued subject to the
conditions that they shall become void if not exchanged for certificates
representing the full shares or uncertificated full shares before specified
date, or subject to the conditions that the shares for which scrip or warrants
are exchangeable may be sold by the corporation and the proceeds thereof
distributed to the holders of scrip or warrants, or subject to any other
conditions which the Board of Directors may impose.
4. STOCK TRANSFERS. Upon compliance with provisions restricting the
transfer or registration of transfer of shares of stock, if any, transfers or
registration of transfers of shares of stock of the corporation shall be made
only on the stock ledger of the corporation by the registered holder thereof, a
by his attorney thereunto authorized by power of attorney duly executed and
filed with the Secretary of the corporation or with a transfer agent or a
registrar, if any, and, in the case of shares represented by certificates, on
surrender of the certificate or certificates for such shares of stock properly
endorsed and the payment of all taxes due thereon.
5. RECORD DATE STOCKHOLDERS. In order that the corporation may
determine the stockholders entitled to notice of or to vote at any meeting of
stockholders or any adjournment thereof. The Board of Directors may fix a record
date, which record date shall not precede the date upon which the resolution
fixing the record date is adopted by the Board of Directors, and which record
date shall not be more than sixty nor less than ten days before the date of such
meeting. If no record date is fixed by the Board of Directors, the record date
for determining stockholders entitled to notice of or to vote at a meeting of
stockholders shall be at the close of business on the day next preceding the day
on which notice is given, or, if notice is waived, at the close of business on
the day next preceding the day on which the meeting is held. A determination of
stockholders of record entitled to notice of or to vote at a meeting of
stockholders shall apply to any adjournment of the meeting; provided, however,
that the Board of Directors may fix a new record date for the adjourned meeting
in order that the corporation may determine the stockholders entitled to consent
to corporate action in writing without a meeting, the Board of Directors may fix
a record date, which record date shall not precede the date upon which the
resolution fixing the record date is adopted by the Board of Directors, and
which date shall not be more than ten days after the date upon which the
resolution fixing the record date is adopted by the Board Of Directors. If no
record date has been fixed by the Board of Directors, the record date for
determining the stockholders entitled to consent to corporate action in writing
without a meeting, when no prior action by the Board of Directors is required by
the General Corporation Law, shall be the first date on which a signed written
consent setting forth the action taken or proposed to be taken is delivered to
the corporation by delivery to its registered office in the State of Delaware,
its principal place of business, or an officer or agent of the corporation
having custody of the book in which proceedings of meetings of stockholders are
recorded. Delivery made to the corporation's registered office shall be by hand
or by certified or registered mail, return receipt requested. If no record date
<PAGE>
has been fixed by the Board of Directors and prior action by the Board of
Directors is required by the General Corporation Law, the record date for
determining stockholders entitled to consent to corporate action in writing
without a meeting shall be at the close of business on the day on which the
Board of Directors adopts the resolution taking such prior action. In order that
the corporation may determine the stockholders entitled to receive payment of
any dividend or other distribution or allotment of any rights or the
stockholders entitled to exercise any rights in respect of any change,
conversion, or exchange of stock, or for the purpose of any other lawful action,
the Board of Directors may fix a record date, which record date shall not
precede the date upon which the resolution fixing the record date is adopted and
which record date shall be not more than sixty days prior to such action. If no
record date is fixed, the record date for determining stockholders for any such
purpose shall be at the close of business on the day on which the Board of
Directors adopts the resolution relating thereto.
6. MEANING OF CERTAIN TERMS. As used herein in respect of the right to
notice of a meeting of stockholders or a waiver thereof or to participate or
vote thereat or to consent or dissent in writing in lieu of a meeting, as the
case may be, the term "share" or "shares" or "share of stock" or "shares of
stock" or "stockholder" or "stockholders" refers to an outstanding share or
shares of stock and to a holder or holders of record of outstanding shares of
stock when the corporation is authorized to issue only one class of shares of
stock and said reference is also intended to include any outstanding share or
shares of stock and any holder or holders of record of outstanding shares of
stock of any class upon which or upon whom the certificate of incorporation
confers such rights where there are two or more classes or series of shares of
stock or upon which a upon whom the General Corporation Law confers such rights
notwithstanding that the certificate of incorporation may provide for more than
one class or series of shares of stock, one a more of which are limited or
denied such rights thereunder; provided, however, that no such right shall vest
in the event of an increase or a decrease in the authorized number of shares of
stock of any class or series which is otherwise denied voting rights under the
provisions of the certificate of incorporation, except as any provision of law
may otherwise require.
7. STOCKHOLDER MEETINGS.
-TIME. The annual meeting shall be held on the date and at the time
fixed, from time to time, by the directors, provided, that the first annual
meeting shall be held on a date within time months after the organization of the
corporation, and each successive annual meeting shall be held on a date within
thirteen months after the date of the preceding annual meeting. A special
meeting shall be held on the date and at the time fixed by the directors.
- PLACE. Annual meetings and special meetings shall be held at such
place, within or without the State of Delaware, as the directors may, from time
to time, fix. Whenever the directors shall fail to fix such place, the meeting
shall be held at the registered office of the Corporation in the State of
Delaware.
- CALL. Annual meetings and special meetings may be called by the
directors or by any officer instructed by the directors to call the meeting.
- NOTICE OR WAIVER OF NOTICE. Written notice of all meetings shall be
given, stating the place, date, and hour of the meeting and stating the place
within the city or
<PAGE>
other municipality or community at which the list of stockholders of the
corporation may be examined. The notice of an annual meeting shall state that
the meeting is called for the election of directors and for the transaction of
other business which may properly come before the meeting, and shall (if any
other action which could be taken at a special meeting is to be taken at such
annual meeting) state the purpose or purposes. The notice of a special meeting
shall in all instances state the purpose or purposes for which the meeting is
called. The notice of any meeting shall also include, or be accompanied by, any
additional statements, information, or documents prescribed by the General
Corporation Law. Except as otherwise provided by the General Corporation Law, a
copy of the notice of any meeting shall be given personally or by mail, not less
than ten days nor more than sixty days before the date of the meeting, unless
the lapse of the prescribed period of time shall have been waived, and directed
to each stockholder at his record address or at such other address which he may
have furnished by request in writing to the Secretary of the corporation. Notice
by mail shall be deemed to be given when deposited, with postage thereon
prepaid, in the United States Mail. If a meeting is adjourned to another time,
not more than thirty days hence, and/or to another place, and if an announcement
of the adjourned time and/or place is made at the meeting, it shall not be
necessary to give notice of the adjourned meeting unless the directors, after
adjournment, fix a new record date for the adjourned meeting. Notice need not be
given to any stockholder who submits a written waiver of notice signed by him
before or after the time stated therein. Attendance of a stockholder at a
meeting of stockholders shall constitute a waiver of notice of such meeting,
except when the stockholder attends the meeting for the express purpose of
objecting, at the beginning of the meeting, to the transaction of any business
because the meeting is not lawfully called or convened. Neither the business to
be transacted at, nor the purpose of, any regular or special meeting of the
stockholders need be specified in any written waiver of notice.
- STOCKHOLDER LIST. The officer who has charge of the stock ledger of
the corporation shall prepare and make, at least ten days before every meeting
of stockholders, a complete list of the stockholders, arranged in alphabetical
order, and showing the address of each stockholder and the number of shares
registered in the name of each stockholder. Such list shall be open to the
examination of any stockholder, for any purpose germane to the meeting, during
ordinary business hours, for a period of at least ten days prior to the meeting,
either at a place within the city or other municipality or community where the
meeting is to be held, which place shall be specified in the notice of the
meeting, or if not so specified, at the place where the meeting is to be held.
The list shall also be produced and kept at the time and place of the meeting
during the whole time thereof, and may be inspected by any stockholder who is
present. The stock ledger shall be the only evidence as to who are the
stockholders entitled to examine the stock ledger, the list required by this
section or the books of the corporation, or to vote at any meeting of
stockholders.
- CONDUCT OF MEETING. Meetings of the stockholders shall be presided
over by one of the following officers in the order of seniority and if present
and acting - the Chairman of the Board, if any, the Vice-Chairman of the Board,
if any, the President, a Vice-President, or, if none of the foregoing is in
office and present and acting, by a chairman to be chosen by the stockholders.
The Secretary of the corporation, or in his absence, an Assistant Secretary,
shall act as secretary of every meeting, but if neither the Secretary nor an
Assistant Secretary is present the Chairman of the meeting shall appoint a
secretary of the meeting.
- PROXY REPRESENTATION. Every stockholder may authorize another person
<PAGE>
or persons to act for him by proxy in all matters in which a stockholder is
entitled to participate, whether by waiving notice of any meeting, voting or
participating at a meeting, or expressing consent a dissent without a meeting.
Every proxy must be signed by the stockholder or by his attorney-in-fact. No
proxy shall be voted or acted upon after three years from its date unless such
proxy provides for a longer period. A duly executed Proxy shall be irrevocable
if it states that it is irrevocable and, if, and only as long as, it is coupled
with an interest sufficient in law to support an irrevocable power. A proxy may
be made irrevocable regardless of whether the interest with which it is coupled
is an interest in the stock itself or an interest in the corporation generally.
- INSPECTORS. The directors, in advance of any meeting, may, but need
not, appoint one or more inspectors of election to act at the meeting or any
adjournment thereof. If an inspector or inspectors are not appointed, the person
presiding at the meeting may, but need not, appoint one or more inspectors. In
case any person who may be appointed as an inspector fails to appear or act, the
vacancy may be filled by appointment made by the directors in advance of the
meeting or at the meeting by the person presiding thereat. Each inspector, if
any, before entering upon the discharge of his duties, shall take and sign an
oath faithfully to execute the duties of inspectors at such meeting with strict
impartiality and according to the best of his ability. The inspectors, if any,
shall determine the number of shares of stock outstanding and the voting power
of each, the shares of stock represented at the meeting, the existence of a
quorum, the validity and effect of proxies, and shall receive votes, ballots, or
consents, hear and determine all challenges and questions arising in connection
with the right to vote, count and tabulate all votes, ballots, or consents,
determine the result, and do such acts as are proper to conduct the election or
vote with fairness to all stockholders. On request of the person presiding at
the meeting, the inspector or inspectors, if any, shall make a report in writing
of any challenge, question, or matter determined by him or them and execute a
certificate of any fact found by him or them. Except as otherwise required by
subsection (e) of Section 231 of the Corporation Law, the provisions of that
Section shall not apply to the corporation.
- QUORUM. The holders of a majority of the outstanding shares of stock
shall constitute a quorum at a meeting of stockholders for the transaction of
any business. The stockholders present may adjourn the meeting despite the
absence of a quorum.
- VOTING. Each share of stock shall entitle the holder thereof to one
vote. Directors shall be elected by a plurality of the votes of the shares
present in person or represented by proxy at the meeting and entitled to vote on
the election of directors. Any other action shall be authorized by a majority of
the votes cast except where the General Corporation Law prescribes a different
percentage of votes and/or a different exercise of voting power, and except as
may be otherwise prescribed by the provisions of the certificate of
incorporation and these Bylaws. In the election of directors, and for any other
action, voting need not be by ballot.
8. STOCKHOLDER ACTION WITHOUT MEETINGS. Except as any provision of the
General Corporation Law may otherwise require, any action required by the
General Corporation Law to be taken at any annual or special meeting of
stockholders, or any action which may be taken at any annual or special meeting
of stockholders, may be taken without a meeting, without prior notice and
without a vote, if a consent in writing, setting forth the action so taken,
shall be signed by the holders of outstanding stock having not less than the
<PAGE>
minimum number of votes that would be necessary to authorize or take such action
at a meeting at which all shares entitled to vote thereon were present and
voted. Prompt notice of the taking of the corporate action without a meeting by
less than unanimous written consent shall be given to those stockholders who
have not consented in writing. Action taken pursuant to this paragraph shall be
subject to the provisions of Section 228 of the General' Corporation Law.
ARTICLE II
DIRECTORS
1. FUNCTIONS AND DEFINITION. The business and affairs of the
corporation shall be managed by or under the direction of the Board of Directors
of the corporation. The Board of Directors shall have the authority to fix the
compensation of the members thereof. The use of the phrase "whole board" herein
refers to the total number of directors which the corporation would have if
there were no vacancies.
2. QUALIFICATIONS AND NUMBER. A director need not be a stockholder, a
citizen of the United States, or a resident of the State of Delaware. The
initial Board of Directors shall consist of (one) 1 persons. Thereafter the
number of directors constituting the whole board shall be at least one. Subject
to the foregoing limitation and except for the first Board of Directors, such
number may be fixed from time to time by action of the stockholders or of the
directors, or, if the number is not fixed, the number shall be one (1). The
number of directors may be increased or decreased by action of the stockholders
or of the directors.
3. ELECTION AND TERM. The first Board of Directors, unless the members
thereof shall have been named in the certificate of incorporation, shall be
elected by the incorporator or incorporators and shall hold office until the
first annual meeting of stockholders and until their successors are elected and
qualified or until their earlier resignation or removal. Any director may resign
at any time upon written notice to the corporation. Thereafter, directors who
are elected at an annual meeting of stockholders, and directors who are elected
in the interim to fill vacancies and newly created directorships, shall hold
office until the next annual meeting of stockholders and until their successors
are elected and qualified or until their earlier resignation or removal. Except
as the General Corporation Law may otherwise require, in the interim between
annual meetings of stockholders or of special meetings of stockholders called
for the election of directors and/or for the removal of one or more directors
and for the filling of any vacancy in that connection, newly created
directorships and any vacancies in the Board of Directors, including unfilled
vacancies resulting from the removal of directors for cause or without cause,
may be filled by the vote of a majority of the remaining directors then in
office, although less than a quorum, or by the sole remaining director.
4. MEETINGS.
- TIME. Meetings shall be held at such time as the Board shall fix,
except that the first meeting of a newly elected Board shall be held as soon
after its election as the directors may conveniently assemble.
- PLACE. Meetings shall be held at such place within or without the
State of
<PAGE>
Delaware as shall be affixed by the Board.
- Call. No call shall be required for regular meetings for which the
time and place have been fixed. Special meetings may be called by or at the
direction of the Chairman of the Board, if any, the Vice-Chairman of the Board,
if any, of the President, or of a majority of the directors in office.
- NOTICE OR ACTUAL OR CONSTRUCTIVE WAIVER. No notice shall be required
for regular meetings for which the time and place have been fixed. Written,
oral, or any other mode of notice of the time and place shall be given for
special meetings in sufficient time for the convenient assembly of the directors
thereat. Notice need not be given to any director or to any member of a
committee of directors who submits a written waiver of notice signed by him
before or after the time stated therein. Attendance of any such person at a
meeting shall constitute a waiver of notice of such meeting, except when he
attends a meeting for the express purpose of objecting, at the beginning of the
meeting, to the transaction of any business because the meeting is not lawfully
called or convened. Neither the business to be transacted at, nor the purpose
of, any regular or special meeting of the directors need be specified in any
written waiver of notice.
- QUORUM AND ACTION. A majority of the whole board shall constitute a
quorum except when a vacancy or vacancies prevents such majority, whereupon a
majority of the directors in office shall constitute a quorum, provided, that
such majority shall constitute at least one-third of the whole Board. A majority
of the directors present, whether or not a quorum is present, may adjourn a
meeting to another time and place Except as herein otherwise provided, and
except as otherwise provided by the General Corporation Law, the vote of the
majority of the directors present at a meeting at which a quorum is present
shall be the act of the Board. The quorum and voting provisions herein suited
shall not be construed as conflicting with any provisions of the General
Corporation Law and these Bylaws which govern a meeting of directors held to
fill vacancies and newly created directorships in the board or action of
disinterested directors.
Any member or members of the Board of Directors or of any committee
designated by the Board, may participate in a meeting of the Board, or any such
committee, as the case may be, by means of conference telephone or similar
communications equipment by means of which all Persons participating in the
meeting can hear each other.
- CHAIRMAN OF THE MEETING. The Chairman of the Board, if any and if
present and acting, shall preside at all meetings. Otherwise, the vice-chairman
of the Board, if any and if present and acting, or the President, if present and
acting, or any other director chosen by the Board, shall preside.
5. REMOVAL OF DIRECTORS. Except as may otherwise be provided by the
General Corporation Law, any director or the entire Board of Directors may be
removed, with or without cause, by the holders of a majority of the shares then
entitled to vote at an election of directors.
6. COMMITTEES. The Board of Directors may designate one or more
committees, each committee to consist of one or more of the directors of the
corporation. The Board may designate one or more directors as alternate members
of any committee, who may replace any
<PAGE>
absent or disqualified member at any meeting of the committee. In the absence or
disqualification of any member of any such committee or committees, the member
or members thereof present at any meeting and not disqualified from voting,
whether or not such member or members constitute a quorum, may unanimously
appoint another member of the Board of Directors to act at the meeting in the
place of any such absent or disqualified member. Any such committee, to the
extent provided in the resolution of the Board, shall have and may exercise the
powers and authority of the Board of Directors in the management of the business
and affairs of the corporation with the exception of any authority the
delegation of which is prohibited by Section 141 of the General Corporation Law,
and may authorize the seal of the corporation to be affixed to alt papers which
may require it.
7- WRITTEN ACTION. Any action required or permitted to be taken at any
meeting of the Board of Directors or any committee thereof may be taken without
a meeting if all members of the Board or committee, as the case may be, consent
thereto in writing, and the writing or writings are filed with the minutes of
proceedings of the Board or committee.
ARTICLE III
OFFICERS
The officers of the corporation shall consist of a President, a
Secretary, a Treasurer, and, if deemed necessary, expedient, or desirable by the
Board of Directors, a Chairman of the Board, a Vice-Chairman of the Board, an
Executive Vice-President, one or more other Vice-Presidents, one or more
Assistant Secretaries, one or more Assistant Treasurers, and such other officers
with such tides as the resolution of the Board of Directors choosing them shall
designate. Except as may otherwise be provided in the resolution of the Board of
Directors choosing him, no officer other than the Chairman or Vice-Chairman of
the Board, if any, need be a director. Any number of offices may be held by the
same person, as the directors may determine.
Unless otherwise provided in the resolution choosing him, each officer
shall be chosen for a term which shall continue until the meeting of the Board
of Directors following the next annual meeting of stockholders and until his
successor shall have been chosen and qualified.
All officers of the corporation shall have such authority and perform
such duties in the management and operation of the corporation as shall be
prescribed in the resolutions of the Board of Directors designating and choosing
such officers and prescribing their authority and duties, and shall have such
additional authority and duties as are incident to their office except to the
extent that such resolutions may be inconsistent therewith The Secretary or an
Assistant Secretary of the corporation shall record all of the proceedings of
all meetings and actions in writing of stockholders, directors, and committees
of directors, and shall exercise such additional authority and perform snob
additional duties as the board shall assign to him. Any officer may be removed,
with or without cause, by the Board of Directors. Any vacancy in any office may
be filled by the Board of Directors.
ARTICLE IV
CORPORATE SEAL
<PAGE>
The corporate seal shall be in such form as the Board of Directors
shall prescribe.
ARTICLE V
FISCAL YEAR
The fiscal year of the corporation shall be fixed, and shall be subject
to change, by the Board of Directors.
ARTICLE VI
CONTROL OVER BYLAWS
Subject to the provisions of the certificate of incorporation and the
provisions of Corporation Law, the power to amend, alter, or repeal these Bylaws
and to adopt new bylaws may be exercised by the Board of Directors or by the
stockholders.
I HEREBY CERTIFY that the foregoing is a full, true, and correct copy
of the Bylaws of Delta Capital Technologies, Inc. a Delaware corporation, as in
effect on the date hereof.
Dated this 23rd day of April, 1998
"Timothy Delaney"
--------------------------------------------
Secretary, Delta Capital Technologies, Inc
(SEAL)
EXHIBIT 10(a)
1. The Parties
The parties to this Agreement are:
827109 ALBERTA LTD., a corporation having its principal place of
business at Suite 255-999 8th Street South West, Calgary, Alberta, Canada, which
is referred to elsewhere in this Agreement as "the Licensor"; and
DELTA CAPITAL TECHNOLOGIES INC., A DELAWARE CORPORATION, having its
principal place of business at 1331 Homer Street, Suite B201, Vancouver, British
Columbia, Canada which is referred to elsewhere in this Agreement as "the
Licensee".
2. Purpose of the Agreement
The purpose of this Agreement is for the Licensor to license the
Licensee to use, market and distribute the Computer Program and Related
Materials in return for which the Licensee will pay the Consideration to the
Licensor.
3. Definitions
The parties agree that, in this Agreement, the following terms have the
following meanings.
ACCEPTANCE This Agreement is effective and accepted
when the conditions of the "Acceptance"
section below are met.
ADDITIONAL TECHNICAL The services described in Schedule 4.
SERVICES
AFFILIATE A company which has a majority of its
voting shares owned directly or
indirectly by either the Licensee or a
company which directly or indirectly
owns a majority of the voting shares of
the Licensee.
COMPUTER PROGRAM The computer program[s] listed in the
Product Specification delivered to the
Licensee and each copy of, update of or
enhancement to such computer program.
CONFIDENTIAL INFORMATION The information specified in the Product
Specification and the information
provided by and designated as
confidential in writing by the Licensor
to the Licensee. Confidential
Information does not include information
which is: - publicly available or
becomes so other than by acts of the
Licensee;
<PAGE>
- received by the Licensee prior to it
being provided by the Licensor to the
Licensee; or - received by the Licensee
from a third party.
DESIGNATED LOCATION Such address as may be designated by the
Licensee and agreed to in writing by the
Licensor, such agreement no to be
unreasonably withheld.
NET SALES Sub-License sales less Sub-Licenses cost
of goods sold and direct sales,
marketing and administrative expenses
related to the software subject to this
agreement.
PRODUCT SPECIFICATION The specification set out in Schedule 1
to this Agreement.
PERFORMANCE SPECIFICATION The specification set out in Schedule 2
to this Agreement.
RELATED MATERIALS The human-readable documentation which
is to be delivered with the Computer
Program. The Related Materials are
specified in the Product Specification.
SERVICE SPECIFICATION The specification set out in Schedule 3
to this agreement.
SUBJECT MATTER The intellectual property right[s] or
the subject of other rights licensed
under this Agreement namely:
- the copyright subsisting in a work
entitled relBuilder Enterprise Suite;
- the Confidential Information;
- all of the above as they are embodied
in the Computer Program and Related
Materials
TERM The time period specified in the "Term"
paragraph below.
TERRITORY The geographic or economic market of the
License, namely: worldwide.
USE In respect of the Computer Program, use
means the execution of the Computer
Program by a computer's central
processing unit(s) for processing the
instructions contained in the Computer
Program.
4. License Grant
<PAGE>
(1) For the Consideration described below, the Licensor hereby grants a License
to the Licensee under the Subject Matter to use, market and distribute the
Computer Program in the Territory for the Term of this Agreement, and to use,
market and distribute the Related Materials in association with such use,
marketing and distribution of the Computer Program, subject to the terms and
conditions of this Agreement.
(2) The License grant is exclusive and during the term and any renewals thereof
will not be offered to any other party.
(3) The Licensee may modify, or customize the Computer Program and Related
Materials. The Licensor is the owner of copyright in the modifications or
customizations. The Licensee shall provide copies of all modifications or
customizations to the Licensor.
(4) The License does not grant any ownership or security interest or title in
any intellectual property right relating to the Computer Program.
(5) The Licensee has the right to sub-license the use of the Computer Program
and Related Materials as specified in this paragraph.
(a) The Licensee may sub-license use of the Computer Program and
Related Materials to any party;
(b) Licensee agrees to sub-license only under the terms of Licensor's
"End-User Licensing Agreement", to be provided to Licensee by Licensor
within thirty (30) days upon request by Licensee.
(6) The License is transferable only under the conditions specified in the
"Assignability" section below.
5. Consideration
(1) The Licensee shall pay to the Licensor the Consideration of:
(a) a lump-sum License fee of $50,000.00 (CAD) payable within sixty
(60) days from the effective date of this Agreement. This payment shall
be non-refundable after Acceptance has occurred; and
(b) a Royalty as defined below;
(2) If the Consideration is not paid when due and upon demand by the Licensor,
the Licensee shall pay to the Licensor interest at the rate of the Bank of
Canada prime,
<PAGE>
payable monthly. Interest on overdue interest is also payable at the same rate
until the amount due is paid.
(3) The Royalty shall be in the following amounts for the following periods,
calculated on the basis of 15% of Net Sales calculated monthly.
(4) The Licensee shall pay a royalty of at least $50,000.00 (CAD) by the end of
the first year of this Agreement; an additional $200,000.00 (CAD) by the end of
the second year of this Agreement; and an additional $300,000.00 (CAD) by the
end of the third year of this Agreement.
6. Obligations of the Licensor
The Licensor shall provide to the Licensee, within sixty (60) days of
the effective date of this Agreement taking effect:
(a) any reasonable number of copies of the Computer Program and Related
Materials as described in the Product Specification requested by the
Licensee; and
(b) training and technical assistance as described in the Service
Specification;
7. Obligations of the Licensee
(1) The Licensee shall not make any copies of the Computer Program or Related
Materials nor permit anyone else to use, have access to, or copy the Computer
Program or Related Materials other than those that are specifically authorized
to be made under this Agreement.
(2) Upon termination of this License, the Licensee shall return to the Licensor
or destroy under oath all copies of the Computer Program and Related Materials.
The Licensee shall erase all Computer Programs from any storage media before
disposal of such media. Within one month of the date of the termination of this
License, the Licensee shall notify the Licensor in writing of the Licensee's
compliance with the requirements of this section.
8. Acceptance
(1) Acceptance and effectiveness of this Agreement will have occurred upon
execution of this Agreement by authorized officers of the parties.
<PAGE>
9. Defects
(1) Obligations of the Licensee
If the Computer Program fails to perform in accordance with the
Performance Specification, the Licensee shall promptly advise the Licensor of
the defect and shall assist the Licensor in identifying and fixing the defect.
(2) Obligations of the Licensor
If the Computer Program fails to perform in accordance with the
Performance Specification, and the Licensee promptly advises the Licensor of the
defect, then the Licensor shall, within 60 days of the communication of the
existence of the defect:
(a) correct the defect, or;
(b) identify the defect and provide a schedule to the Licensee for
correcting the defect.
10. Upgrades/Interim Maintenance Releases
The Licensor shall deliver to the Licensee:
(a) upgrade versions or new versions of the Computer Program and
Related Materials; and
(b) interim maintenance releases of the Computer Program and Related
Materials.
11. Term
(1) The term of the License is three (3) years beginning on the date this
Agreement takes effect.
(2) This License terminates thirty (30) days after the non-breaching party gives
notice to the breaching party of a material breach of a provision of this
Agreement, unless the breaching party has remedied the breach within that time.
(3) This License terminates automatically upon the occurrence of any of the
following events:
(a) The insolvency of the Licensee;
<PAGE>
(b) The Licensee executes an assignment for the benefit of
creditors;
(c) The Licensee ceases to carry on business;
(d) The Licensee becomes subject to receivership or bankruptcy
proceedings;
(e) The Licensee fails to make any prescribed royalty payments
within sixty (60) days of such royalty payments being due,
provided that in the event that the Licensee is terminated as
set out herein, the Licensee shall only be responsible for its
pro-rata share of its annual royalty payment
(4) The parties acknowledge that the Licensee has the right to retain,
access, copy and modify all data files containing Licensee's data used
or generated by the Computer Program.
(5) This agreement may be renewed upon expiration for an unlimited term for
the sum of one ($1.00) unless such period is limited by operation of
law.
12. Warranties
(1) The Licensor and Licensee warrant to each other as follows:
(a) Each corporate party is duly incorporated and subsisting under
the laws of its place of incorporation or subsistence.
(b) Each party has the power to and is authorized to enter into
this Agreement.
(c) The carrying out of this Agreement will not breach or
interfere with any other agreement to which the respective
party has entered into.
(d) Neither party will enter into another agreement the carrying
out of which would interfere with the carrying out of this
Agreement;
(2) The Licensor warrants as follows:
(a) The Licensor has the right to license the Subject Matter free
of any liens or encumbrances. Any portions of the Computer
Program and Related Materials, the intellectual property of
which are owned by someone other than the Licensor, have been
licensed to the Licensor for sub-licensing to the Licensee and
others. Such License does not restrict the ability of the
Licensor to grant the Licenses set out in this Agreement.
<PAGE>
(b) The Licensor owns the right, title and interest in the
physical media provided to the Licensee under this Agreement.
(c) The Computer Program is of marketable quality.
(d) To the best of the Licensor's knowledge, the use of the
Computer Program does not infringe the intellectual property
rights of others nor is the Licensor aware of any allegations
made that the use of the Computer Program infringes the
intellectual property rights of others.
(e) The Computer Program does not contain any programs which are
intended to permit unauthorized access, or cause damage to
other programs, data or hardware.
(3) The Licensee warrants that it shall keep the License of this Agreement
free of liens, claims and encumbrances.
(4) The above warranties are instead of any and all other warranties,
representations or conditions express or implied, oral or written with
respect to the Computer Program and Related Materials, including any
implied warranties or conditions of title, non-infringement,
merchantability or fitness or suitability for a particular purpose. The
Licensor disclaims and the Licensee waives all other such warranties,
representations and conditions. Certain jurisdictions do not permit
such exclusion of warranties, so this disclaimer may not apply to the
Licensee.
13. Indemnification
(1) The Licensor shall indemnify the Licensee against all claims including
liabilities and legal costs and disbursements made against the Licensee alleging
that any use of the Computer Program or Related Materials constitutes
infringement of any copyright, patent, trade-mark, or trade secret rights.
(2) The Licensor shall have carriage of the defense of such claim made against
the Licensee and has the exclusive right to settle the claim so long as the
settlement does not interfere with the business arrangements of the Licensee.
The Licensee shall cooperate fully in the conduct of the defense. The Licensee
shall either retain the legal counsel designated by the Licensor or may retain
its own counsel at its own expense.
(3) The Licensee shall notify the Licensor as soon as possible upon any claim
being made against the Licensee that its use of the Computer Program is alleged
to be an infringement of the intellectual property rights of others.
(4) In the event that the Computer Program is finally held by a court of
competent jurisdiction, to be an infringement of the intellectual property
rights of another, then
<PAGE>
the Licensor shall:
(a) modify the Computer Program to make it non-infringing; or
(b) obtain a License for use of the Computer Program from the
other party; or
(c) terminate the License and refund any payments the Licensee has
made.
14. Relief
(1) Injunctive Relief
Any unauthorized use of any intellectual property rights of the
Licensor made or caused by the Licensee will result in irreparable harm to the
Licensor which cannot be adequately compensated for by damages. The Licensor is
entitled to a court-ordered injunction in the event such use is made or caused
by the Licensee.
(2) Limitation of Damages
The Licensor shall not be liable to the Licensee for incidental,
special or consequential damages caused by the breach of any term or warranty of
this Agreement, including lost profits, lost data, loss of computer time or any
commercial or economic loss. The liability of the Licensor shall, in any event,
be limited to the total monies paid by the Licensee to the Licensor as the
Consideration for this Agreement. Certain jurisdictions do not permit such
exclusion of liability for consequential damages, so this disclaimer may not
apply to the Licensee.
15. Dispute Resolution
(1) Governing Law
This Agreement shall be interpreted under the laws of Alberta, Canada.
(2) Arbitration
Disputes, other than those for immediate cessation of conduct by a
party to this Agreement, shall be resolved under arbitration in accordance with
the Licensing Agreement Arbitration Rules of the American Arbitration
Association.
The Arbitration shall take place at a location agreed to by the parties
in the English language.
<PAGE>
The costs of the arbitration shall be paid equally by the parties.
The decision of the arbitrator shall be binding on the parties and may
be entered in any Court having jurisdiction to do so.
16. Confidentiality
(1) The Licensee acknowledges that the Confidential Information is a trade
secret and is owned by the Licensor.
(2) The Licensee will take all reasonable precautions to maintain the
confidentiality of the Confidential Information and to prevent the unauthorized
disclosure to others of the Confidential Information. The Licensee shall not be
liable for damages caused to the Licensor by inadvertent breaches of
confidentiality.
(3) The Licensee shall only disclose the Confidential Information to those of
its employees who have a need to know and require access to the Confidential
Information to exploit the License. The Licensee shall require each employee who
receives the Confidential Information to agree in writing, prior to such
disclosure, to maintain the information as confidential.
17. Non-competition
The Licensee may develop computer software similar in function to the
Licensor's Computer Program. Those employees of the Licensee who develop such
computer software shall not have had access to the Licensor's Confidential
Information for a two-year period prior to commencing such development. Further,
the Licensor shall not be engaged in, develop software, or be a party to the
development, marketing or licensing of any software which could reasonably be
assumed to be in competition with the software that is the subject of this
agreement.
18. Reverse Engineering
The Licensee shall not reverse engineer, decompile or disassemble the
object code version of the Computer Program without the prior written approval
of the Licensor.
19. Assignability
(1) This License is assignable by the Licensee to another person or legal entity
only with the express prior written permission of the Licensor.
<PAGE>
(2) This Agreement is binding on the parties to this Agreement, their successors
and assigns.
20. General Provisions
(1) This Agreement constitutes the entire agreement between the parties
concerning the Computer Program. The parties are not relying upon any earlier
representation which is not included in this Agreement.
(2) This Agreement cannot be amended or modified other than by a change made in
writing and executed by the parties.
(3) Covenants concerning intellectual property are to be construed as being
independent of other provisions in this Agreement.
(4) In the event that any portion of this Agreement is held by a court of
competent jurisdiction to be invalid or unenforceable, then the remaining
portions of the Agreement shall survive unaffected.
(5) Notice may be sent, by any means whatsoever, to the address specified at the
beginning of this Agreement or at such other address for notice which may be
given by notification of the other party in writing. Notice is effective on the
date that the notice is received. Notice by courier or registered mail is deemed
to be given on the date recorded as delivered. Notice by telecopy or Telex is
deemed to be made on the date and at the time it is sent and acknowledged as
being received.
(6) The waiver by any party of a breach of this Agreement does not constitute a
waiver of other breaches or rights under this Agreement.
(7) Delays or non-performance of any obligations under this Agreement caused by
events beyond the control of the party having the obligation, shall not be a
breach of this Agreement. The time for carrying out the obligation shall extend
for a period equal to the time over which the conditions existed.
(8) The headings in this Agreement are for reference purposes only and cannot be
used to construe the terms of the Agreement.
(9) This Agreement does not establish a joint venture or partnership between the
Licensor and Licensee.
(10) This Agreement shall be recorded in any and all offices where such recordal
is necessary under the laws of the respective country.
<PAGE>
EXECUTED AT Vancouver, British Columbia, Canada, this _1___ day of
_____June____, _1999_.
Licensor
"Paul Davis"
------------------------------
By: Paul Davis
Title: President
Licensee
"Judith Miller"
------------------------------
By: Judith Miller
Title: Corporate Secretary
<PAGE>
SCHEDULE 1
Product Specification
(1) The Computer Program to be delivered under this Agreement is a set of
instructions or statements expressed, fixed, embodied or stored in any manner,
that is to be used directly or indirectly in a computer in order to bring about
a specific result and has the following characteristics:
(a) Brand Name: relBuilder Enterprise Suite
(2) The Computer Program shall be in executable form.
(3) The Related Materials shall include:
(a) operation and user manuals
(b) instructions
(4) The Computer Program shall be in the form of:
(a) source code in a form which may be compiled or assembled to
executable code.
Confidential Information
(1) The following items are confidential and proprietary to the Licensor:
(a) the source code version of the Computer Program;
(b) the Computer Program system specification;
(c) the methods and concepts embodied in the Computer Program;
(d) the structure, sequence and organization of the Computer
Program.
(2) All written forms of the Confidential Information shall bear a conspicuous
notice identifying the subject matter as being Confidential Information. The
Licensee shall not remove such notice.
<PAGE>
SCHEDULE 2
Performance Specification
(1) "as-documented"
(a) The Licensor warrants that the Computer Program will perform in
accordance with its description in its documentation on the computer
hardware and operating system specified in its documentation.
(b) The Licensor does not warrant that the Computer Program will operate
with any other Computer Program not so specified in the documentation.
(c) The only remedy of the Licensee under this warranty is the Licensee
may terminate the License. If the Licensee terminates the License under
this warranty, the Licensor shall pay to the Licensee 90% of the License
fee paid by the Licensee.
<PAGE>
SCHEDULE 3
Service Specification
(1) Training
The Licensor shall train a reasonable number of employees of the
Licensee in the use and operation of the Computer Program.
(2) Technical Assistance
The Licensor shall provide the following technical assistance:
(a) Installation support; and
(b) Troubleshooting support.
(3) Maintenance
The Licensor shall maintain the Computer Program and Related Materials
in an operable form as described in the Product Specification and Performance
Specification.
<PAGE>
SCHEDULE 4
Additional Technical Services
The Licensor shall provide the following technical services:
(a) Integration training for Licensee developers;
(b) Support for Licensee developers; and
(c) Architectural training for Licensee developers.
EXHIBIT 10(b)
1. The Parties
The parties to this Agreement are:
SICOM SOLUTIONS INC., a corporation having its principal place of
business at Suite 255 - 999 8th Street South West, Calgary, Alberta, Canada,
which is referred to elsewhere in this Agreement as "The Licensor"; and
827109 ALBERTA LTD., a corporation having its principal place of
business at Suite 255 - 999 8th Street South West, Calgary, Alberta, Canada,
which is referred to elsewhere in this Agreement as "the Licensee".
2. Purpose of the Agreement
The purpose of this Agreement is for the Licensor to license the
Licensee to use, market and distribute the Computer Program and Related
Materials in return for which the Licensee will pay the Consideration to the
Licensor.
3. Definitions
The parties agree that, in this Agreement, the following terms have the
following meanings.
ACCEPTANCE This Agreement is effective and accepted
when the conditions of the "Acceptance"
section below are met.
ADDITIONAL TECHNICAL The services described in SCHEDULE 4.
SERVICES
affiliate A company which has a majority of its
voting shares owned directly or
indirectly by either the Licensee or a
company which directly or indirectly
owns a majority of the voting shares of
the Licensee.
COMPUTER PROGRAM The computer program[s] listed in the
Product Specification delivered to the
Licensee and each copy of, update of or
enhancement to such computer program.
CONFIDENTIAL INFORMATION The information specified in the Product
Specification and the information
provided by and designated as
confidential in writing by the Licensor
to the Licensee. Confidential
Information does not include information
which is:
<PAGE>
67
- publicly available or becomes so other
than by acts of the Licensee;
- received by the Licensee prior to it
being provided by the Licensor to the
Licensee; or
- received by the Licensee from a third
party.
DESIGNATED LOCATION Such address as may be designated by the
Licensee and agreed to in writing by the
Licensor.
PRODUCT SPECIFICATION The specification set out in Schedule 1
to this Agreement.
PERFORMANCE SPECIFICATION The specification set out in Schedule 2
to this Agreement.
RELATED MATERIALS The human-readable documentation which
is to be delivered with the Computer
Program. The Related Materials are
specified in the Product Specification.
SERVICE SPECIFICATION The specification set out in Schedule 3
to this agreement.
SUBJECT MATTER The intellectual property right[s] or
the subject of other rights licensed
under this Agreement namely:
- the copyright subsisting in a work
entitled relBuilder Enterprise Suite;
- the Confidential Information;
- all of the above as they are embodied
in the Computer Program and Related
Materials
TERM The time period specified in the "Term"
paragraph below.
TERRITORY The geographic or economic market of the
License, namely: worldwide.
USE In respect of the Computer Program, use
means the execution of the Computer
Program by a computer's central
processing unit(s) for processing the
instructions contained in the Computer
Program.
4. License Grant
(1) For the Consideration described below, the Licensor hereby grants a License
to
<PAGE>
the Licensee under the Subject Matter to use, market and distribute the
Computer Program in the Territory for the Term of this Agreement, and to use,
market and distribute the Related Materials in association with such use,
marketing and distribution of the Computer Program, subject to the terms and
conditions of this Agreement.
(2) The License grant is exclusive.
(3) The Licensee may modify, or customize the Computer Program and Related
Materials. The Licensor is the owner of copyright in the modifications or
customizations. The Licensee shall provide copies of all modifications or
customizations to the Licensor.
(4) The License does not grant any ownership or security interest or title in
any intellectual property right relating to the Computer Program.
(5) The Licensee has the right to sub-license as specified in this paragraph.
(a) The Licensee may sub-license any party;
(b) Sub-Licensees may only license use of the Computer Program and
Related Materials, under the terms of Licensor's "End-User Licensing
Agreement", to be provided to Sub-Licensee by Licensor within thirty
(30) days upon request by Sub-Licensee.
(6) The License is transferable only under the conditions specified in the
"Assignability" section below.
5. Consideration
(1) The Licensee shall pay to the Licensor the Consideration of:
(a) a lump-sum License fee of $50,000.00 (CAD) payable within
sixty (60) days from the effective date of this Agreement. This payment
shall be non-refundable after Acceptance has occurred; and
(b) a Royalty as defined below;
(2) If the Consideration is not paid when due and upon demand by the Licensor,
the Licensee shall pay to the Licensor interest at the rate of the Bank of
Canada prime, payable monthly. Interest on overdue interest is also payable at
the same rate until the amount due is paid.
(3) The Royalty shall be in the following amounts for the following periods,
<PAGE>
calculated on the basis of 15% of net sales.
(4) The Licensee shall pay a royalty of at least $50,000.00 (CAD) by the end of
the first year of this Agreement; an additional $200,000.00 (CAD) by the end of
the second year of this Agreement; and an additional $300,000.00 (CAD) by the
end of the third year of this Agreement.
6. Obligations of the Licensor
The Licensor shall provide to the Licensee, within ninety (90) days of
the effective date of this Agreement taking effect:
(a) any reasonable number of copies of the Computer Program and Related
Materials as described in the Product Specification requested by the
Licensee; and
(b) training and technical assistance as described in the Service
Specification;
7. Obligations of the Licensee
(1) The Licensee shall not make any copies of the Computer Program or Related
Materials nor permit anyone else to use, have access to, or copy the Computer
Program or Related Materials other than those that are specifically authorized
to be made under this Agreement.
(2) Upon termination of this License, the Licensee shall return to the Licensor
or destroy under oath all copies of the Computer Program and Related Materials.
The Licensee shall erase all Computer Programs from any storage media before
disposal of such media. Within one month of the date of the termination of this
License, the Licensee shall notify the Licensor in writing of the Licensee's
compliance with the requirements of this section.
8. Acceptance
(1) Acceptance and effectiveness of this Agreement will have occurred upon
execution of this Agreement by authorized officers of the parties.
9. Defects
(1) Obligations of the Licensee
<PAGE>
If the Computer Program fails to perform in accordance with the
Performance Specification, the Licensee shall promptly advise the Licensor of
the defect and shall assist the Licensor in identifying and fixing the defect.
(2) Obligations of the Licensor
If the Computer Program fails to perform in accordance with the
Performance Specification, and the Licensee promptly advises the Licensor of the
defect, then the Licensor shall, within 90 days of the communication of the
existence of the defect:
(a) correct the defect, or;
(b) identify the defect and provide a schedule to the Licensee for
correcting the defect.
10. Upgrades/Interim Maintenance Releases
The Licensor shall deliver to the Licensee:
(a) upgrade versions or new versions of the Computer Program and
Related Materials; and
(b) interim maintenance releases of the Computer Program and Related
Materials.
11. Term
(1) The term of the License is three (3) years beginning on the date this
Agreement takes effect.
(2) This License terminates thirty (30) days after the non-breaching party gives
notice to the breaching party of a material breach of a provision of this
Agreement, unless the breaching party has remedied the breach within that time.
(3) This License terminates automatically upon the occurrence of any of the
following events:
(a) The insolvency of the Licensee;
(b) The Licensee executes an assignment for the benefit of creditors;
(c) The Licensee ceases to carry on business;
<PAGE>
(d) The Licensee becomes subject to receivership or bankruptcy
proceedings;
(4) The parties acknowledge that the Licensee has the right to retain, access,
copy and modify all data files containing Licensee's data used or generated by
the Computer Program.
12. Warranties
(1) The Licensor and Licensee warrant to each other as follows:
(a) Each corporate party is duly incorporated and subsisting under the
laws of its place of incorporation or subsistence.
(b) Each party has the power to and is authorized to enter into this
Agreement.
(c) The carrying out of this Agreement will not breach or interfere
with any other agreement to which the respective party has entered
into.
(d) Neither party will enter into another agreement the carrying out of
which would interfere with the carrying out of this Agreement;
(2) The Licensor warrants as follows:
(a) The Licensor has the right to license the Subject Matter free of any
liens or encumbrances. Any portions of the Computer Program and Related
Materials, the intellectual property of which are owned by Licensor or
are owned by someone other than the Licensor, and have been licensed to
the Licensor for sub-licensing to the Licensee and others. Such License
does not restrict the ability of the Licensor to grant the Licenses set
out in this Agreement.
(b) The Licensor owns the right, title and interest in the physical
media provided to the Licensee under this Agreement.
(c) The Computer Program is of marketable quality.
(d) To the best of the Licensor's knowledge, the use of the Computer
Program does not infringe the intellectual property rights of others nor
is the Licensor aware of any allegations made that the use of the
Computer Program infringes the intellectual property rights of others.
(e) The Computer Program does not contain any programs which are
intended to permit unauthorized access, or cause damage to other
programs, data
<PAGE>
or hardware.
(3) The Licensee warrants that it shall keep the License of this Agreement free
of liens, claims and encumbrances.
(4) The above warranties are instead of any and all other warranties,
representations or conditions express or implied, oral or written with respect
to the Computer Program and Related Materials, including any implied warranties
or conditions of title, non-infringement, merchantability or fitness or
suitability for a particular purpose. The Licensor disclaims and the Licensee
waives all other such warranties, representations and conditions. Certain
jurisdictions do not permit such exclusion of warranties, so this disclaimer may
not apply to the Licensee.
13. Indemnification
(1) The Licensor shall indemnify the Licensee against all claims including
liabilities and legal costs and disbursements made against the Licensee alleging
that any use of the Computer Program or Related Materials constitutes
infringement of any copyright, patent, trade-mark, or trade secret rights.
(2) The Licensor shall have carriage of the defense of such claim made against
the Licensee and has the exclusive right to settle the claim so long as the
settlement does not interfere with the business arrangements of the Licensee.
The Licensee shall cooperate fully in the conduct of the defense. The Licensee
shall either retain the legal counsel designated by the Licensor or may retain
its own counsel at its own expense.
(3) The Licensee shall notify the Licensor as soon as possible upon any claim
being made against the Licensee that its use of the Computer Program is alleged
to be an infringement of the intellectual property rights of others.
(4) In the event that the Computer Program is finally held by a court of
competent jurisdiction, to be an infringement of the intellectual property
rights of another, then the Licensor shall:
(a) modify the Computer Program to make it non-infringing; or
(b) obtain a License for use of the Computer Program from the
other party; or
(c) terminate the License and refund any payments the Licensee has
made.
14. Relief
<PAGE>
(1) Injunctive Relief
Any unauthorized use of any intellectual property rights of the
Licensor made or caused by the Licensee will result in irreparable harm to the
Licensor which cannot be adequately compensated for by damages. The Licensor is
entitled to a court-ordered injunction in the event such use is made or caused
by the Licensee.
(2) Limitation of Damages
The Licensor shall not be liable to the Licensee for incidental,
special or consequential damages caused by the breach of any term or warranty of
this Agreement, including lost profits, lost data, loss of computer time or any
commercial or economic loss. The liability of the Licensor shall, in any event,
be limited to the total monies paid by the Licensee to the Licensor as the
Consideration for this Agreement. Certain jurisdictions do not permit such
exclusion of liability for consequential damages, so this disclaimer may not
apply to the Licensee.
15. Dispute Resolution
(1) Governing Law
This Agreement shall be interpreted under the laws of Alberta, Canada.
(2) Arbitration
Disputes, other than those for immediate cessation of conduct by a
party to this Agreement, shall be resolved under arbitration in accordance with
the Licensing Agreement Arbitration Rules of the American Arbitration
Association.
The Arbitration shall take place at a location agreed to by the parties
in the English language.
The costs of the arbitration shall be paid equally by the parties.
The decision of the arbitrator shall be binding on the parties and may
be entered in any Court having jurisdiction to do so.
16. Confidentiality
(1) The Licensee acknowledges that the Confidential Information is a trade
secret and is owned by the Licensor.
(2) The Licensee will take all reasonable precautions to maintain the
confidentiality
<PAGE>
of the Confidential Information and to prevent the unauthorized disclosure to
others of the Confidential Information. The Licensee shall not be liable for
damages caused to the Licensor by inadvertent breaches of confidentiality.
(3) The Licensee shall only disclose the Confidential Information to those of
its employees who have a need to know and require access to the Confidential
Information to exploit the License. The Licensee shall require each employee who
receives the Confidential Information to agree in writing, prior to such
disclosure, to maintain the information as confidential.
17. Non-competition
The Licensee may develop computer software similar in function to the
Licensor's Computer Program. Those employees of the Licensee who develop such
computer software shall not have had access to the Licensor's Confidential
Information for a two-year period prior to commencing such development.
18. Reverse Engineering
The Licensee shall not reverse engineer, decompile or disassemble the
object code version of the Computer Program without the prior written approval
of the Licensor.
19. Assignability
(1) This License is assignable by the Licensee to another person or legal entity
only with the express prior written permission of the Licensor.
(2) This Agreement is binding on the parties to this Agreement, their successors
and assigns.
20. General Provisions
(1) This Agreement constitutes the entire agreement between the parties
concerning the Computer Program. The parties are not relying upon any earlier
representation which is not included in this Agreement.
(2) This Agreement cannot be amended or modified other than by a change made in
writing and executed by the parties.
(3) Covenants concerning intellectual property are to be construed as being
<PAGE>
independent of other provisions in this Agreement.
(4) In the event that any portion of this Agreement is held by a court of
competent jurisdiction to be invalid or unenforceable, then the remaining
portions of the Agreement shall survive unaffected.
(5) Notice may be sent, by any means whatsoever, to the address specified at the
beginning of this Agreement or at such other address for notice which may be
given by notification of the other party in writing. Notice is effective on the
date that the notice is received. Notice by courier or registered mail is deemed
to be given on the date recorded as delivered. Notice by telecopy or Telex is
deemed to be made on the date and at the time it is sent and acknowledged as
being received.
(6) The waiver by any party of a breach of this Agreement does not constitute a
waiver of other breaches or rights under this Agreement.
(7) Delays or non-performance of any obligations under this Agreement caused by
events beyond the control of the party having the obligation, shall not be a
breach of this Agreement. The time for carrying out the obligation shall extend
for a period equal to the time over which the conditions existed.
(8) The headings in this Agreement are for reference purposes only and cannot be
used to construe the terms of the Agreement.
(9) This Agreement does not establish a joint venture or partnership between the
Licensor and Licensee.
(10) This Agreement shall be recorded in any and all offices where such recordal
is necessary under the laws of the respective country.
EXECUTED AT Calgary, Alberta, Canada, this ____1 _ day of ___June____,
1999_.
Licensor
"Paul Davis"
--------------------------------------
By: Paul Davis
Title: President and Chief Executive Officer
Licensee
"Paul Davis"
--------------------------------------
By: Paul Davis
Title: President
<PAGE>
SCHEDULE 1
Product Specification
(1) The Computer Program to be delivered under this Agreement is a set of
instructions or statements expressed, fixed, embodied or stored in any manner,
that is to be used directly or indirectly in a computer in order to bring about
a specific result and has the following characteristics:
(a) Brand Name: relBuilder Enterprise Suite
(2) The Computer Program shall be in executable form.
(3) The Related Materials shall include:
(a) operation and user manuals
(b) instructions
(4) The Computer Program shall be in the form of:
(a) source code in a form which may be compiled or assembled to
executable code.
Confidential Information
(1) The following items are confidential and proprietary to the Licensor:
(a) the source code version of the Computer Program;
(b) the Computer Program system specification;
(c) the methods and concepts embodied in the Computer Program;
(d) the structure, sequence and organization of the Computer
Program.
(2) All written forms of the Confidential Information shall bear a conspicuous
notice identifying the subject matter as being Confidential Information. The
Licensee shall not remove such notice.
<PAGE>
SCHEDULE 2
Performance Specification
(1) "as-documented"
(a) The Licensor warrants that the Computer Program will perform in
accordance with its description in its documentation on the computer
hardware and operating system specified in its documentation.
(b) The Licensor does not warrant that the Computer Program will operate
with any other Computer Program not so specified in the documentation.
(c) The only remedy of the Licensee under this warranty is the Licensee
may terminate the License. If the Licensee terminates the License under
this warranty, the Licensor shall pay to the Licensee 90% of the License
fee paid by the Licensee.
<PAGE>
SCHEDULE 3
Service Specification
(1) Training
The Licensor shall train a reasonable number of employees of the
Licensee in the use and operation of the Computer Program.
(2) Technical Assistance
The Licensor shall provide the following technical assistance:
(a) Installation support; and
(b) Troubleshooting support.
(3) Maintenance
The Licensor shall maintain the Computer Program and Related Materials
in an operable form as described in the Product Specification and Performance
Specification.
<PAGE>
SCHEDULE 4
Additional Technical Services
The Licensor shall provide the following technical services:
(a) Integration training for Licensee developers;
(b) Support for Licensee developers; and
(c) Architectural training for Licensee developers.
EXHIBIT 10(c)
827109 ALBERTA LTD.
#255 - 999 - 8TH STREET, SW, CALGARY, ALBERTA T2R 1J5
PH: (403) 244-7300 FAX: (403) 244-7211
September 2, 1999
Delta Capital Technologies Inc.
c/o B201, 1331 Homer Street
Vancouver, BC V6B 5M5
Dear Sirs:
With reference of the License Agreement between 827109 Alberta Ltd.
("AlbertaCo") and Delta Capital Technologies Inc. ("DeltaCap"), dated June 1,
1999, Section 5(a), Consideration, "a lump-sum fee of $50,000.00 (CAD) payable
within sixty (60) days from the effective date of this Agreement", we hereby
acknowledge receipt of $20,000.00 (CAD).
Further, we grant a three (3) month extension to DeltaCap for payment of the
balance of funds in the amount of $30,000.00 until November 1, 1999.
Yours truly,
827109 ALBERTA LTD.
"Paul Davis"
- ----------------------------
Paul Davis
President
EXHIBIT 10(d)
SICOM #255 - 999 - 8th Street, S.W.
Calgary, Alberta, Canada T2R 1J5
Phone: (403) 244 - 7300 Fax: (403) 244-7211
E-mail: [email protected]
www.ebizsolutions.com
SiCom Solutions Inc.
September 2, 1999
827109 Alberta Ltd.
#205, 999 - 8th Street SW
Calgary, AB T2R 1J5
Dear Sirs:
With reference of the License Agreement between SiCom Solutions Inc. ("SiCom")
and 827109 Alberta Ltd. ("AlbertaCo"), dated June 1, 1999, Section 5(a),
Consideration, "a lump-sum fee of $50,000.00 (CAD) payable within sixty (60)
days from the effective date of this Agreement," we hereby acknowledge receipt
of $20,000.00 (CAD).
Further, we grant a three (3) month extension to AlbertaCo for payment of the
balance of funds in the amount of $30,000.00 until November 1, 1999.
Yours truly,
SiCOM SOLUTIONS INC.
"Paul Davis"
- ----------------------------
Paul Davis
President
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
EXHIBIT 27
This schedule contains summary financial information extracted from the audited
balance sheets of the Company at July 31, 1999 and December 31, 1998 and the
statement of operations, stockholders' equity, and cash flow for the seven
months ended July 341, 1999 and the period from March 4, 1998 to December 31,
998 and the period from March 4, 1998 (date of inception) to July 31, 1999.
</LEGEND>
<CIK> 0001066764
<NAME> DELTA CAPITAL TECHNOLOGIES INC.
<CURRENCY> U.S. Dollars
<S> <C> <C>
<PERIOD-TYPE> 12-MOS 7-MOS
<FISCAL-YEAR-END> DEC-31-1999 DEC-31-1999
<PERIOD-START> JAN-01-1998 JAN-01-1999
<PERIOD-END> DEC-31-1998 JUL-31-1999
<EXCHANGE-RATE> 1 1
<CASH> $20,926 $1,169
<SECURITIES> 0 0
<RECEIVABLES> 0 0
<ALLOWANCES> 0 0
<INVENTORY> 0 $564
<CURRENT-ASSETS> $20,926 $1,169
<PP&E> 0 $11,637
<DEPRECIATION> 0 0
<TOTAL-ASSETS> $20,926 $13,370
<CURRENT-LIABILITIES> 0 $41,083
<BONDS> 0 0
0 0
0 0
<COMMON> 8,800,000 8,800,000
<OTHER-SE> 0 0
<TOTAL-LIABILITY-AND-EQUITY> $20,926 $13,370
<SALES> 0 0
<TOTAL-REVENUES> 0 0
<CGS> 0 0
<TOTAL-COSTS> 0 0
<OTHER-EXPENSES> $39,281 $48,639
<LOSS-PROVISION> ($39,281) ($48,639)
<INTEREST-EXPENSE> 0 0
<INCOME-PRETAX> 0 0
<INCOME-TAX> 0 0
<INCOME-CONTINUING> 0 0
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> ($39,281) 0
<EPS-BASIC> 0 0
<EPS-DILUTED> 0 0
</TABLE>
EXHIBIT 99(a)
SHARE EXCHANGE AGREEMENT (hereinafter referred to as "Agreement") between Delta
Capital Technologies, Inc., a Delaware corporation (hereinafter referred to as
"Delta"), and 827109 Alberta Ltd., an Alberta, Canada corporation (hereinafter
referred to as "AlbertaCO").
THE PARTIES AGREE as follows:
1. The parties intend that the securities exchange described herein between
Delta and AlbertaCO will, if allowable, be tax free in accordance with the
provisions of Section 368(a)(1)(B) of the Internal Revenue Code and with
the Income Tax Act of Canada. In the event that it is not allowable, the
parties hereto confirm that the value attributed to the AlbertaCO shares
will be shareholder equity at par value.
2. Exchange of Securities. Subject to the terms and conditions herein, at the
time of the closing referred to in Section 6 hereof (the "Closing Date"),
Delta will issue and deliver, or cause to be issued and delivered to
AlbertaCO 5,000,000 shares of Delta's restricted common stock, in exchange
for 5,000,000 shares of common stock of AlbertaCO to be issued. The shares
of Delta and AlbertaCO will be allocated as set forth in Schedule I,
attached.
3. Representations and Warranties by AlbertaCO. AlbertaCO represents and
warrants to Delta, all of which representations and warranties shall be
true at the time of closing, and shall survive the closing for a period of
six (6) months from the date of closing that:
a) AlbertaCO is a corporation duly organized and validly existing
and in good standing under the laws of Alberta, Canada and has
the corporate powers to own its property and carry on its
business as and where it is now being conducted. Copies of the
Certificate of Incorporation and the By-Laws of AlbertaCO,
which have heretofore been furnished by AlbertaCO to Delta,
are true and correct copies of said Certificate of
Incorporation and By-Laws including all amendments to the date
hereof.
b) The authorized capital stock of AlbertaCO is an unlimited
number of shares at no par value, of which 9,000,000 shares
have been validly issued and are now outstanding.
c) AlbertaCO is authorized to issue 5,000,000 shares of common
stock, at par value of $0.001 per share (the "Shares").
d) AlbertaCO has full power to exchange the Shares upon the terms
provided for in this Agreement, the Shares will be duly and
validly issued and will be free and clear of any lien or other
encumbrance, and no party has an option or right to purchase
any of the Shares from AlbertaCO other than Delta in
accordance with this Agreement.
e) From the date hereof, and until the date of closing, no
dividends or distributions of capital, surplus, or profits
shall be paid or declared by AlbertaCO in redemption of their
outstanding shares or otherwise and no additional shares shall
be issued by said corporation.
f) Since the date hereof, AlbertaCO has not engaged in any
transaction other than transactions in the normal course of
the operations of their business, except as specifically
authorized by Delta in writing.
4. Representations and Warranties by Delta. Delta represents and warrants to
AlbertaCO all of which representations and warranties shall be true at the
time of closing, and shall survive the closing for a period of six (6)
months from the date of closing that:
a) Delta is a corporation duly organized and validly existing and
in good standing under the laws of the State of Delaware and
has the corporate power to own its properties and carry on its
business as now being conducted and has authorized capital
stock consisting of 25,000,000 shares of common stock, $.001
par value per share, of which there are 8,800,000 shares
presently outstanding.
b) Delta has the corporate power to execute and perform this
Agreement, and to deliver the stock required to be delivered
to AlbertaCO hereunder.
<PAGE>
c) The execution and delivery of this Agreement, and the issuance
of the stock required to be delivered hereunder have been duly
authorized by all necessary corporate actions, and neither the
execution nor delivery of this Agreement, nor the issuance of
the stock, nor the performance, observance or compliance with
the terms and provisions of this Agreement will violate any
provision of law, any order of any court or other governmental
agency, the Certificate of Incorporation or By-Laws of Delta
or any indenture, agreement or other instrument to which Delta
is a party, or by which Delta is bound, or by which any of its
property is bound.
d) The shares of common stock of Delta deliverable pursuant
hereto will on delivery in accordance with the terms hereof,
be duly authorized, validly issued, and fully paid, and
non-assessable.
5. Conditions to the Obligations of AlbertaCO. The obligations of AlbertaCO
are subject to the conditions that:
a) AlbertaCO shall not have discovered any material error or
misstatement in any of the representations and warranties made
by Delta herein and all the terms and conditions of this
Agreement to be performed and complied with by Delta shall
have been performed and complied with.
b) There shall have been no substantial adverse changes in the
conditions, financial, business otherwise of Delta from the
date of this Agreement, and until the date of closing, except
for changes resulting from those operations in the usual and
ordinary course of business, and between such dates the
business and assets of Delta shall not have been materially
adversely affected as the result of any fire, explosion,
earthquake, flood, accident, strike, lockout, combination of
workmen, taking over of any such assets by any governmental
authorities, riot, activities of armed forces, or acts of God
or of the public enemies.
c) AlbertaCO shall upon request, at the time of closing, receive
an opinion of counsel to the effect that: (1) Delta is a
corporation duly organized and validly existing under the laws
of the State of Delaware, and has the power to own and operate
its properties wherever the same shall be located as of the
Closing Date; (2) the execution, delivery and performance of
this Agreement by Delta has been duly authorized by all
necessary corporate action and constitutes a legal, valid and
binding obligation of Delta, enforceable in accordance with
its terms; (3) the securities to be delivered to AlbertaCO
pursuant to the terms of this Agreement have been validly
issued, fully paid and non-assessable; (4) the exchange of the
securities herein contemplated does not require the
registration of the shares of Delta to be issued pursuant to
any Federal law dealing with the issuance, sale, transfer,
and/or exchange of corporate securities; (5) to the best of
its knowledge Delta is not under investigation by the SEC, the
NASD or any state securities commission; (6) that there are no
known securities violations; (7) all shares issued by Delta
have been validly issued in accordance with Delaware or
Federal law, are fully paid and non-assessable; and (8) there
are no outstanding options, rights, warrants, conversion
privileges or other agreements which would require issuance of
additional shares.
6. Conditions to the Obligations of Delta . The obligations of Delta hereunder
shall be subject to the conditions that:
a) Delta shall not have discovered any material error or
misstatement in any of the representations and warranties by
AlbertaCO herein, and all the terms and conditions of this
Agreement to be performed and complied with by AlbertaCO shall
have been performed and complied with.
b) There shall have been no substantial adverse changes in the
conditions, financial, business otherwise of AlbertaCO from
the date of this Agreement, and until the date of closing,
except for changes resulting from those operations in the
usual and ordinary course of business, and between such dates
the business and assets of AlbertaCO shall not have been
materially adversely affected as the result of any fire,
explosion, earthquake, flood, accident, strike, lockout,
combination of workmen, taking over of any such assets by any
governmental authorities, riot, activities of armed forces, or
acts of God or of the public enemies.
c) Delta shall upon request and at the time of closing, receive
an opinion of counsel to the effect that: (1) AlbertaCO is
duly organized and validly existing under the laws of Alberta,
Canada and has the power and authority to own its properties
and to carry on its respective business wherever the same
shall be located and operated as of the Closing Date; and, (2)
this Agreement has been duly executed and delivered by
<PAGE>
AlbertaCO and constitutes a legal, valid and binding
obligation of AlbertaCO enforceable in accordance with its
terms.
d) AlbertaCO does not now have, nor will it have on the date of
closing, any known liabilities or contingent liabilities.
7. Closing Date. The closing shall take place on or before
_____________________________, 1999, or as soon thereafter as is
practicable, at the Law Offices of Gordon Fretwell, #920 - 800 West Pender
St., Vancouver, BC, or at such other time and place as the parties hereto
shall agree upon.
8. Actions at the Closing. At the closing, Delta and AlbertaCO will each
deliver, or cause to be delivered to the other, the securities to be
exchanged in accordance with Section I of this Agreement and each party
shall pay any and all Federal and State taxes required to be paid in
connection with the issuance and the delivery of their own securities. All
stock certificates shall be in the name of the party to which the same are
deliverable.
9. Conduct of Business, Board of Directors, etc . Between the date hereof and
the Closing Date, the parties will conduct their business in the same
manner in which it has heretofore been conducted and the parties will not:
(1) enter into any contract, etc., other than in the ordinary course of
business; or (2) declare or make any distribution of any kind to their
stockholders, without first obtaining the written consent of the other
party.
10. Upon closing, a new Director will be elected by the shareholders of Delta,
such that the Board of Directors will consist of the following individuals.
Paul F. Davis
Kevin K. Wong
Judith Miller
11. Upon closing, Judith Miller, President and Secretary of Delta will tender
her resignation as President and upon election of the above Board of
Directors, and subject to the authority of the Board of Directors as
provided by law and the By-Laws of Delta, the officers of Delta, after the
closing date of this Agreement shall be as follows:
Paul F. Davis, President
Kevin K. Wong, Vice President
Judith Miller, Secretary & Treasurer
12. Access to the Properties and Books of Parties. The parties hereby grant to
each other, through their duly authorized representatives and during normal
business hours between the date hereof and the Closing Date, the right of
full and complete access to the properties of each other and full
opportunity to examine each other's books and records.
13. Miscellaneous
a) This Agreement shall be construed and enforced in accordance
with the laws of the State of Delaware.
b) Each of AlbertaCO and Delta shall bear and pay all costs and
expenses incurred by it or on its behalf in connection with
the consummation of this Agreement, including, without
limiting the generality of the foregoing, fees and expenses of
financial consultants, accountants and counsel and the cost of
any documentary stamps, sales and excise taxes which may be
imposed upon or be payable in respect to the transaction.
c) At any time before or after the approval and adoption by the
respective stockholders of AlbertaCO and Delta, if required,
this Agreement may be amended or supplemented by additional
written agreements, as may be determined in the judgment of
the respective Boards of Directors of AlbertaCO and Delta to
be necessary, desirable or expedient to further the purpose of
this Agreement, to clarify the intention of the parties, to
add to or to modify the covenants, terms or conditions
contained herein, or otherwise to effectuate or facilitate the
consummation of the transaction contemplated hereby. Any
written
<PAGE>
agreement referred to in this paragraph shall be validly and
sufficiently authorized for the purposes of this Agreement if
signed on behalf of AlbertaCO or Delta, as the case may be, by
its Chairman of the Board, or its President.
d) This Agreement may be executed in any number of counterparts
and each counterpart hereof shall be deemed to be an original
instrument, but all such counterparts together shall
constitute but one agreement.
e) This Agreement shall be binding upon and shall inure to the
benefit of the heirs, executors, administrators and assigns of
AlbertaCO and Delta.
f) All notices, requests, instructions, or other documents to be
given hereunder shall be in writing and sent by registered
mail:
<TABLE>
<S> <C>
If to AlbertaCO then: If to Delta, then:
Suite 255, 999 8th Street SW, Calgary, AB, Canada T2R 1J5 1331 Homer Street, Suite B201, Vancouver, BC, Canada
V6B 1H3
</TABLE>
This Agreement has been duly approved or adopted by the Board of Directors, and
duly approved or adopted by the stockholders of the constituent corporation, as
required, in the manner provided by the laws of the State of Delaware, the
Chairman of the Board, the President or the Secretary of said corporations under
the respective seals of said corporations by the authority of the directors and
stockholders of each, as required, as the act, deed and agreement of each of
said corporations. This Agreement may be signed in two or more counterparts.
AGREEMENT, dated as of this 1 day of June , 1999, between Delta and AlbertaCO.
DELTA CAPITAL TECHNOLOGIES, INC. 827109 ALBERTA LTD.
"Judith Miller" "Paul Davis"
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Judith Miller, President Paul F. Davis, CEO
<PAGE>
Acknowledgment of Execution of Agreement
By Officer of
Delta Capital Technologies, Inc.
STATE OF ______________)
) ss.
COUNTY OF ____________)
BE IT REMEMBERED that on this ______ day of ___________, __________, personally
came before me, a Notary Public in and for jurisdiction aforesaid, Judith
Miller, President of Delta Capital Technologies, Inc., a Delaware corporation,
and one of the corporations described in and which executed the foregoing
Agreement, known to me personally to be such, and she, the said, Judith Miller,
as such President, duly executed said Agreement before me and acknowledged said
Agreement are in the handwriting of said President of Delta Capital
Technologies, Inc.
IN WITNESS WHEREOF, I have hereunto set my hand and seal of office the day and
year aforesaid.
- ------------------------------
Notary Public
<PAGE>
Acknowledgment of Execution of Agreement
By Officer of
827109 Alberta Ltd.
STATE OF ______________)
) ss.
COUNTY OF ____________)
BE IT REMEMBERED that on this ______ day of ___________, 1999, personally came
before me, a Notary Public in and for jurisdiction aforesaid, Paul Davis,
President of 827109 Alberta Ltd., an Alberta, Canada corporation, and one of the
corporations described in and which executed the foregoing Agreement, known to
me personally to be such, and he, the said, Paul Davis, as such Chief Executive
Officer, duly executed said Agreement before me and acknowledged said Agreement
are in the handwriting of said Chief Executive Officer of 827109 Alberta Ltd.
IN WITNESS WHEREOF, I have hereunto set my hand and seal of office the day and
year aforesaid.
- -------------------------------
Notary Public
<PAGE>
SCHEDULE I
ALLOCATION OF 5,000,000 SHARES
OF DELTA CAPITAL TECHNOLOGIES, INC. RESTRICTED COMMON STOCK
TO BE ISSUED TO:
827109 Alberta Ltd.
#255, 999 8th Street SW
Calgary, Alberta, Canada
T2R 1J5
ALLOCATION OF 5,000,000 SHARES
OF 827109 ALBERTA LTD. COMMON STOCK
TO BE ISSUED TO:
Delta Capital Technologies, Inc.
1331 Homer Street, Suite B201
Vancouver, BC
V6B 1H3
EXHIBIT 99(b)
STOCK OPTION AGREEMENT
THIS AGREEMENT made as of the 15th day of September, 1999
BETWEEN:
JUDITH MILLER, of Suite B201 - 1331 Homer Street, Vancouver,
British Columbia V6B 5M5
(hereinafter called the "Optionee")
OF THE FIRST PART
AND:
DELTA CAPITAL TECHNOLOGIES INC., a company duly incorporated
under the laws of the State of Delaware and having an office
at Suite 255 - 999 - 8th Street South West, Calgary, Alberta
(hereinafter called the "Company")
OF THE SECOND PART
WHEREAS:
A. The Optionee is a Director of the Company and in that capacity is devoting
considerable time and effort to the development of the Company; and
B. The Company wishes to encourage the best efforts of the undernoted and wishes
to recognize the Optionee's efforts and risk;
NOW THEREFORE in consideration of the aforenoted efforts and
service and these premises and other good and valuable consideration:
1. Subject to the hereinafter provisions, the Company hereby grants to the
undernoted Optionee an option to purchase, in whole or in part, as fully paid
and non-assessable, 200,000 shares of the Company at a price of US$0.0075 per
share exercisable until December 31, 1999.
2. In the event that the Optionee ceases to serve the Company in the
above-mentioned capacity, all the rights granted to the Optionee hereunder as to
any of the shares herein optioned, which the Optionee has not theretofore
purchased, shall terminate within 30 days of such event.
3. In the event of the death of the Optionee during the term of this Agreement,
this Agreement shall terminate except that the Optionee's personal
representatives shall be entitled to exercise all or any part of the option
granted herein PROVIDED ALWAYS that payment is tendered prior to December 31,
1999.
4. If the Optionee at any time and from time to time during the term of this
Agreement desires to purchase any of the optioned shares, the Optionee may do so
by giving notice to the Company at its registered office within the time herein
noted for exercise of the option, subject to the terms and conditions of this
Agreement.
5. Payment for any of the optioned shares shall be made by tendering to the
Company at its registered office the Optionee's cheque in favour of the Company
in the full amount of the purchase price payable hereunder for such number of
the shares comprised in the election.
6. If, at any time during the continued existence of this Agreement, there shall
be any alteration in the capital stock of the Company, other than a mere
increase in the authorized or issued capital, then the outstanding option shall
attach to an appropriate unaltered percentage of the number of the shares or
securities of the Company which shall have been created by any such alteration,
and the price payable on the exercise of the option, shall be adjusted
proportionately to the change in the shares resulting from such capital
alteration.
7. The Option and the Shares subject to the Option (collectively referred to as
the "Securities") are subject to registration under the Securities Act of 1933,
as amended (the "Securities Act"), and any applicable state securities statutes.
Optionee acknowledges that unless a registration statement with respect to the
Securities is filed and declared effective by the Securities and Exchange
Commission and the appropriate
<PAGE>
state governing agency, the Securities have or will be issued in reliance on
specific exemptions from such registration requirements for transactions by an
issuer not involving a public offering and specific exemptions under state
statutes. Any disposition of the Securities may, under certain circumstances, be
inconsistent with such exemptions. The Securities may be offered for sale, sold,
or otherwise transferred only if i) registered under the Securities Act, and in
some cases, under the applicable state securities acts, or, if not registered,
ii) only if pursuant to an exemption from such registration requirements and
only after the Optionee provides an opinion of counsel or other evidence
satisfactory to the Company to the effect that registration is not required. In
some states, specific conditions must be met or approval of the securities
regulatory authorities may be required before any such offer or sale. The
Company is under no obligation to register the Securities with the Securities
and Exchange Commission or any state agency. If rule 144 is available (and no
assurance is given that it will be), only routine sales of the Common Stock in
limited amounts can be made after one year following the acquisition date of the
Securities, as determined under rule 144(d), in accordance with the terms and
conditions of rule 144. The Company is under no obligation to make rule 144
available. In the event rule 144 is not available, compliance with regulation A
or some other disclosure exemption may be required before the Optionee can sell,
transfer, or otherwise dispose of the Securities without registration. The
Company and its registrar and transfer agent will maintain a stop transfer order
against the transfer of the Securities, and this Option and any other
certificate or agreement representing the Securities is subject to the following
legend:
THE SECURITIES REPRESENTED BY THIS OPTION, AGREEMENT, OR CERTIFICATE HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND ARE "RESTRICTED SECURITIES" WITHIN THE MEANING OF
RULE 144 PROMULGATED UNDER THE SECURITIES ACT. THE SECURITIES HAVE BEEN
ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD OR TRANSFERRED WITHOUT
COMPLYING WITH RULE 144 IN THE ABSENCE OF AN EFFECTIVE REGISTRATION OR
OTHER COMPLIANCE UNDER THE SECURITIES ACT.
The Company may refuse to transfer the Securities to any transferee who does not
furnish in writing to the Company the same representations and warranties set
forth in this paragraph and agree to the same conditions with respect to such
Securities as are set forth herein. The Company may further refuse to transfer
the Securities if certain circumstances are present reasonably indicating that
the proposed transferee's representations are not accurate. In any event, the
Company may refuse to consent to any transfer in the absence of an opinion of
legal counsel, satisfactory to and independent of counsel of the Company, that
such proposed transfer is consistent with the above conditions and applicable
securities laws.
8. This Agreement is neither assignable nor transferable.
9. Time shall be of the essence of this Agreement.
10. This Agreement shall enure to the benefit of and bind the parties hereto and
shall, to the extent hereinbefore provided, enure to the parties' heirs,
executors, successors, administrators and assigns.
11. The provisions herein constitute the entire agreement between the parties
and supersede all previous understandings and agreements.
12. This Agreement is subject to the approval of the regulatory authorities
where required by the laws, regulations and by-laws to which the Company is
subject.
IN WITNESS WHEREOF the parties hereto have executed these
presents as of the day and year first above written.
DELTA CAPITAL TECHNOLOGIES INC.
Per:
"Paul Davis"
- ----------------------------
Authorized Signatory
<PAGE>
SIGNED, SEALED and DELIVERED )
by JUDITH MILLER in the presence of: )
)
)
) "Judith Miller"
- ----------------------------------------- ) ---------------------------------
Witness ) JUDITH MILLER
)
Address )
)
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Occupation )
