<PAGE>
FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
Of the SECURITIES EXCHANGE ACT OF 1934
For the month of November, 1999.
Sideware Systems Inc.
Suite 102, 930 West First Street, North Vancouver, British Columbia,
Canada V7Y 3N4
[Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or Form 40-F.]
Form 20-F x . Form 40-F .
-------- --------
[Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934.]
Yes . No x .
-------- --------
If "Yes" is marked, indicate below the file number assigned to the registrant in
connection with RULE 12g3-2(b): 82 - .
------------
<PAGE>
Quarterly Report FORM 61
ISSUER DETAILS
For Quarter Ended: September 30, 1999
Date of Report: November 29, 1999
Name of Issuer: Sideware Systems Inc.
Issuers Address: 102 - 930 West 1st Street, North Vancouver, B.C., V7P 3N4
Issuer Fax Number: (604) 980-7121
Issuer Phone Number: (604) 986-6121
Contact Person: Grant Sutherland
Contact Position: Chairman
Contact Telephone Number: (604) 986-6121
CERTIFICATE
The three schedules required to complete this Quarterly Report are attached
and the disclosure contained therein has been approved by the Board of
Directors. A copy of this Quarterly Report will be provided to any
shareholder who requests it.
Directors Name: "Grant Sutherland" Date Signed: November 29, 1999
Directors Name: "Owen Jones" Date Signed: November 29, 1999
<PAGE>
Consolidated Financial Statements of
SIDEWARE SYSTEMS INC.
(a Company in the Development Stage)
(expressed in Canadian dollars)
Nine months ended September 30, 1999
(Prepared by management)
<PAGE>
SIDEWARE SYSTEMS INC.
(a Company in the Development Stage)
Consolidated Balance Sheets
(expressed in Canadian dollars)
(Prepared by management)
<TABLE>
<CAPTION>
==============================================================================
September 30, October 31,
1999 1998
- ------------------------------------------------------------------------------
(restated -
note 6(e))
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 8,422,659 $ 338,130
Accounts receivable
Trade 104,620 70,479
Other - 200,000
Due from related parties (note 4(b)) 236,747 247,122
Inventory 22,627 96,025
Prepaid expenses 284,917 125,947
- ------------------------------------------------------------------------------
9,071,570 1,077,703
Deposit on leases 25,807 8,213
Loans receivable 350,563 -
Capital assets (note 5) 1,095,195 603,789
- ------------------------------------------------------------------------------
$ 10,543,135 $ 1,689,705
==============================================================================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued liabilities $ 392,437 $ 208,247
Capital tax payable 7,100 7,100
- ------------------------------------------------------------------------------
399,537 215,347
Subscriptions received - 462,604
Shareholders' equity:
Share capital (note 6) 26,680,101 11,516,774
Special warrants (note 6(d)) - 1,200,000
Commitment related to investment advisory
services - 75,000
Deficit accumulated during the development
stage (16,536,503) (11,780,020)
- ------------------------------------------------------------------------------
10,143,598 1,011,754
Future operations (note 2)
Litigation (note 8)
Commitments (note 9)
Uncertainty due to the Year 2000 issue
(note 10)
- ------------------------------------------------------------------------------
$ 10,543,135 $ 1,689,705
==============================================================================
</TABLE>
See accompanying notes to consolidated financial statements.
Approved by the Board:
"Grant Sutherland" Director "Owen Jones" Director
- ----------------------- -----------------------
<PAGE>
SIDEWARE SYSTEMS INC.
(a Company in the Development Stage)
Consolidated Statements of Operations and Deficit
(expressed in Canadian dollars)
(Prepared by management)
<TABLE>
<CAPTION>
==============================================================================
Nine months Nine months
ended ended
September 30, 1999 October 31, 1998
- ------------------------------------------------------------------------------
<S> <C> <C>
Revenue:
Sales $ 326,494 $ 72,323
- ------------------------------------------------------------------------------
Cost of sales (exclusive of
amortization and other costs
disclosed separately below): 318,415 64,716
- ------------------------------------------------------------------------------
Gross margin 8,079 7,607
Interest income 119,560 32,639
- ------------------------------------------------------------------------------
127,639 40,246
Operating expenses:
Amortization 212,056 150,691
Bad debts 15,974 -
Employee wages and benefits 1,060,813 425,019
Filing and transfer fees 380,753 7,413
Investment advisory services
(note 6(e)) 160,000 75,000
Office, printing and sundry 213,750 124,228
Professional fees 591,618 254,292
Marketing 774,208 768,046
Facilities 311,193 74,124
Research and development 799,904 359,452
Foreign exchange loss (gain) (231,076) (93,030)
Capital taxes - 7,100
- ------------------------------------------------------------------------------
4,289,193 2,152,335
- ------------------------------------------------------------------------------
Loss before non-operating items 4,161,554 2,112,089
Write-off of capital assets 52,450 -
- ------------------------------------------------------------------------------
Loss for the period, carried forward 4,214,004 2,112,089
</TABLE>
<PAGE>
SIDEWARE SYSTEMS INC.
(a Company in the Development Stage)
Consolidated Statements of Operations and Deficit, Continued
(expressed in Canadian dollars)
(Prepared by management)
<TABLE>
<CAPTION>
==============================================================================
Nine months Nine months
ended ended
September 30, 1999 October 31, 1998
- ------------------------------------------------------------------------------
(restated -
note 6(e))
<S> <C> <C>
Loss for the period, brought forward $ 4,214,004 $ 2,112,089
Deficit, accumulated during the
development stage, beginning
of period 13,322,499 9,667,931
- ------------------------------------------------------------------------------
Deficit, accumulated during the
development stage, end of period $16,536,503 $11,780,020
==============================================================================
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
SIDEWARE SYSTEMS INC.
(a Company in the Development Stage)
Consolidated Statements of Changes in Financial Position
(expressed in Canadian dollars)
(Prepared by management)
<TABLE>
<CAPTION>
==============================================================================
Nine months Nine months
ended ended
September 30, 1999 October 31, 1998
- ------------------------------------------------------------------------------
(restated -
note 6(e))
<S> <C> <C>
Cash provided by (used for):
Operations:
Loss for the period $(4,214,004) $(2,112,089)
Items not involving the use
of cash:
Amortization 212,056 150,691
Write-off of capital assets 52,450 -
Investment advisory services
settled by equity instruments
(note 6(e)) 160,000 75,000
Changes in non-cash operating
working capital:
Accounts receivable 130,561 (219,880)
Due from related parties 138,568 (122,098)
Inventory 21,478 (96,025)
Prepaid expenses (186,509) (14,834)
Accounts payable and accrued
liabilities 120,799 4,392
- ------------------------------------------------------------------------------
(3,564,601) (2,334,843)
Financing:
Share subscriptions received - 462,604
Shares issued for cash on exercise
of warrants and options 3,112,645 22,000
Special warrants issued for cash 2,985,908 -
Shares issued for cash 6,652,692 -
- ------------------------------------------------------------------------------
12,751,245 484,604
Investments:
Loans receivable (350,563) -
Purchase of capital assets (713,172) (308,575)
Deposit on lease, net (17,594) -
- ------------------------------------------------------------------------------
(1,081,329) (308,575)
- ------------------------------------------------------------------------------
Increase (decrease) in cash and
cash equivalents 8,105,315 (2,158,814)
Cash and cash equivalents,
beginning of period 317,344 2,496,944
- ------------------------------------------------------------------------------
Cash and cash equivalents, end
of period $ 8,422,659 $ 338,130
==============================================================================
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
SIDEWARE SYSTEMS INC.
Consolidated Notes to Financial Statements
(expressed in Canadian dollars)
Nine months ended September 30, 1999
With comparative figures for the nine months ended October 31, 1998
(Prepared by management)
==============================================================================
1. GENERAL:
The Company was incorporated in 1983 under the Company Act (British
Columbia). Its principal business activity is developing and marketing
of software. During the year ended April, 1998, the Company changed its
name from Jot-It! Software Corp. to Sideware Systems Inc. Effective
December 31, 1998, the fiscal year end of the company was changed from
April 30th to December 31st.
2. FUTURE OPERATIONS:
At September 30, 1999, the Company is in the business of developing and
marketing computer software technology solutions with a principal focus
on the e-commerce market. To date, the Company has not generated
significant revenues from these operations. For financial reporting
purposes, the Company is considered to be in the development stage and
the accompanying financial statements are those of a development stage
enterprise.
As at September 30, 1999, the Company has an accumulated deficit of
$16,536,503 and incurred a loss of $4,214,004 during the nine months
ended September 30, 1999. In addition, the Company is the defendant in a
number of legal proceedings and claims, the maximum potential losses
under which are material (note 9). The Company has filed counterclaims
on certain of these claims. These financial statements have been
prepared in accordance with generally accepted accounting principles
applicable to a going concern. Accordingly, they do not give effect to
adjustments that would be necessary should the Company be unable to
continue as a going concern. The Company's continuance as a going
concern is dependent upon its ability to obtain adequate equity
financing, to reach profitable levels of operation and its success in
defending existing legal claims all of which are consistent with
management's intentions. There is no certainty that such conditions can
be achieved. In the next twelve months, management of the Company also
intends on applying financing received to the continued development of
products in process and to identify sales or strategic alliance
opportunities with respect to such products. At the date of these
consolidated financial statements significant additional financing
sources have not been identified.
3. SIGNIFICANT ACCOUNTING POLICIES:
(a) Basis of presentation:
These consolidated financial statements have been prepared in
accordance with generally accepted accounting principles in
Canada. The consolidated financial statements include the accounts
of the company, and its subsidiaries, 9050 Investments Ltd.,
Sideware Corp. (formerly Collaborative Groupware Inc.), Evergreen
International Technology Inc. (which is inactive) and 9123
Investments Ltd., all of which are wholly-owned. In addition, the
Company accounts by the equity method for its one-third interest in
Concurrent Adoptive Recognition Corp. (which is inactive). All
material intercompany balances and transactions have been
eliminated.
<PAGE>
SIDEWARE SYSTEMS INC.
(a Company in the Development Stage)
Consolidated Notes to Financial Statements, page 2
(expressed in Canadian dollars)
Nine months ended September 30, 1999
With comparative figures for the nine months ended October 31, 1998
(Prepared by management)
==============================================================================
3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
(b) Cash and cash equivalents:
Cash and cash equivalents have terms to maturity at the date of
acquisition of not more than three months.
(c) Capital assets:
Capital assets are carried at cost less accumulated amortization.
Amortization is calculated annually as follows:
<TABLE>
<CAPTION>
====================================================================
Asset Basis Rate
--------------------------------------------------------------------
<S> <C> <C>
Furniture and fixtures declining-balance 20%
Computer equipment declining-balance 30%
Trade show assets declining-balance 20%
Computer software straight-line 50%
Leasehold improvements straight-line lease term
====================================================================
</TABLE>
(d) Income taxes:
The Company follows the tax allocation method of accounting. Under
this method, deferred income taxes are provided on timing
differences between income reported for tax purposes and accounting
income. In addition, the Company records those investment tax
credits, for which it has reasonable assurance of realization, as a
reduction of the expenses or the cost of capital assets to which
they relate.
(e) Research and development costs:
Research costs are expensed as incurred. Development costs are
deferred if they meet certain specified criteria which relate to
the identification of costs, future benefits and funding
requirements. Where development costs do not meet such criteria,
they are expensed as incurred. Government grants, which are not
refundable are disclosed as a reduction of the related cost.
Management periodically assesses the underlying value of deferred
development costs by reference to business plans and estimated
future cash flows and records write-downs where appropriate.
<PAGE>
SIDEWARE SYSTEMS INC.
(a Company in the Development Stage)
Consolidated Notes to Financial Statements, page 3
(expressed in Canadian dollars)
Nine months ended September 30, 1999
With comparative figures for the nine months ended October 31, 1998
(Prepared by management)
==============================================================================
3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
(f) Revenue recognition:
The Company recognizes revenue when title has passed to the
customer, the collectability of the consideration is measurable and
the Company has no significant remaining performance obligations.
This includes revenues from sales to resellers which are recorded
in accordance with their terms when the resellers have no right of
return and the Company has no other remaining performance
obligations. The Company recognizes sales of equipment, to related
parties, in revenues and related costs in cost of sales as the
Company takes title to and holds the equipment, bearing all of the
risks and rewards of ownership, prior to sale, and bears the same
risks as for sales to unrelated parties after sale, including the
risks related to collection of receivables.
(g) Financial instruments:
The Company accounts for financial instruments at cost. The
carrying amounts reported in the balance sheet for cash, accounts
receivable, due from related parties, accounts payable and accrued
liabilities, capital tax payable and due to directors and officers
are estimated by management to approximate their fair values, due
to the short-term maturity of these instruments. The Company has no
outstanding derivative instruments, or other instruments with
credit or interest rate risk.
(h) Use of estimates:
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting
period. Significant areas requiring the use of management estimates
relate to the collectability of the amounts due from related
parties. Actual amounts may differe from these estimates.
4. RELATED PARTY TRANSACTIONS:
(a) Transactions with related parties:
During the period, the Company was charged $348,615 (October 31,
1998 - $136,583), for services rendered and $349,348 (October 31,
1998 - $214,500) in salaries.
Included in revenues and cost of sales are revenues and related
costs associated with equipment sales to BrainTech, Inc. and
Techwest Management Inc., companies with certain common
shareholders and directors to the Company.
(b) Due from related parties:
At Spetember 30, 1999, the Company was owed $236,747 (October 31,
1998 - $247,122) with respect to costs incurred by the Company on
behalf of BrainTech Inc. and TechWest Management Inc., companies
with directors in common. These amounts are unsecured, payable on
demand and bear no interest.
<PAGE>
SIDEWARE SYSTEMS INC.
(a Company in the Development Stage)
Consolidated Notes to Financial Statements, page 4
(expressed in Canadian dollars)
Nine months ended September 30, 1999
With comparative figures for the nine months ended October 31, 1998
(Prepared by management)
==============================================================================
5. CAPITAL ASSETS:
<TABLE>
<CAPTION>
=========================================================================
September 30,
1999
-------------------------------------------------------------------------
Accumulated Net book
Cost amortization value
-------------------------------------------------------------------------
<S> <C> <C> <C>
Furniture and fixtures $ 447,553 $ 114,966 $ 332,587
Computer equipment 820,239 360,219 460,020
Trade show assets 124,020 24,011 100,009
Computer software 97,210 35,372 61,838
Leasehold improvements 715,991 575,250 140,741
-------------------------------------------------------------------------
$2,205,013 $1,109,818 $1,095,195
=========================================================================
<CAPTION>
=========================================================================
October 31,
1998
-------------------------------------------------------------------------
Accumulated Net book
Cost amortization value
-------------------------------------------------------------------------
<S> <C> <C> <C>
Furniture and fixtures $ 125,737 $ 80,381 $ 45,356
Computer equipment 461,189 250,561 210,628
Trade show assets 111,721 5,586 106,135
Computer software 98,440 59,550 38,890
Leasehold improvements 707,277 504,497 202,780
-------------------------------------------------------------------------
$1,504,364 $ 900,575 $ 603,789
=========================================================================
</TABLE>
6. SHARE CAPITAL:
Authorized: 94,148,696 common shares without nominal or par value.
Issued:
<TABLE>
<CAPTION>
=========================================================================
Number
of Shares Amount
-------------------------------------------------------------------------
<S> <C> <C>
Balance, April 30, 1995 12,719,217 $5,451,969
Cancellation of escrow shares (a) (1,926,908) -
-------------------------------------------------------------------------
Balance, April 30, 1996 10,792,309 5,451,969
Shares issued on exercise of special
warrants 7,683,000 1,754,500
Shares issued on exercise of
transferable warrants 404,500 200,250
Cancellation of shares (a) (3,924,396) -
Shares issued for settlement of debt 1,489,449 372,362
Performance shares issued for cash 750,000 7,500
Shares issued on exercise of options 123,000 44,280
Less share issue costs - (93,437)
-------------------------------------------------------------------------
Balance, April 30, 1997, carried forward 17,317,859 7,739,424
</TABLE>
<PAGE>
SIDEWARE SYSTEMS INC.
(a Company in the Development Stage)
Consolidated Notes to Financial Statements, page 5
(expressed in Canadian dollars)
Nine months ended September 30, 1999
With comparative figures for the nine months ended October 31, 1998
(Prepared by management)
==============================================================================
6. SHARE CAPITAL (CONTINUED):
<TABLE>
<CAPTION>
=========================================================================
Number
of Shares Amount
-------------------------------------------------------------------------
<S> <C> <C>
Balance, April 30, 1997, brought forward 17,317,859 $ 7,739,424
Shares issued on exercise of
non-transferable warrants 4,203,100 2,106,500
Shares issued on exercise of options 699,000 352,100
Shares issued to a director in
satisfaction of a royalty claim 100,000 25,000
Special warrants converted to shares 4,450,000 1,293,750
-------------------------------------------------------------------------
Balance, April 30, 1998 26,769,959 11,516,774
Special warrants converted to shares 500,000 1,200,000
-------------------------------------------------------------------------
Balance, December 31, 1998 27,269,959 12,716,774
Shares issued on exercise of
non-transferable warrants 5,467,900 2,669,950
Shares issued on exercise of options 604,000 442,695
Special warrants converted to shares 9,724,611 3,962,990
Shares issued for cash 2,746,833 6,652,692
Shares issued for financial advisory
services (e) 250,000 160,000
-------------------------------------------------------------------------
Balance, September 30, 1999 46,063,303 $26,605,101
=========================================================================
</TABLE>
Unless otherwise indicated, common shares issued for non-cash
consideration are valued at their market value at date of issuance.
(a) Escrow shares:
Included in issued shares at September 30, 1999 are 1,030,378
shares (October 31, 1998 - 1,030,378) held in escrow to be released
based on a cash flow formula.
On November 22, 1995, 1,926,908 escrowed shares held by a former
director were cancelled by the Company. During the year ended April
30, 1997 the Company offered one free trading share in exchange for
6.4 escrow shares held under safekeeping agreement dated January
11, 1991. As a result, 3,924,396 shares were cancelled and 726,758
shares were released from escrow.
(b) Stock options:
(i) The following stock options were outstanding at September 30,
1999:
<TABLE>
<CAPTION>
===============================================================
Number Exercise price
of Shares per share Expiry date
---------------------------------------------------------------
<S> <C> <C>
855,000 $0.50 May 1, 2001
246,000 $0.36 February 12, 2002
30,000 $0.82 March 26, 2002
530,000 $0.70 December 16, 2002
390,000 $0.36 October 6, 2003
637,500 $1.14 April 24, 2004
172,500 $1.35 April 29, 2004
1,090,000 $2.33 June 17, 2004
</TABLE>
<PAGE>
SIDEWARE SYSTEMS INC.
(a Company in the Development Stage)
Consolidated Notes to Financial Statements, page 6
(expressed in Canadian dollars)
Nine months ended September 30, 1999
With comparative figures for the nine months ended October 31, 1998
(Prepared by management)
==============================================================================
6. SHARE CAPITAL (CONTINUED):
(b) Stock options (continued):
(ii) The following stock options were outstanding at October 31,
1998:
<TABLE>
<CAPTION>
===============================================================
Number Exercise price
of Shares per share Expiry date
---------------------------------------------------------------
<S> <C> <C>
885,000 $0.50 May 1, 2001
267,000 $0.36 February 12, 2002
40,000 $0.50 February 12, 2002
93,000 $0.82 March 26, 2002
740,000 $0.70 December 16, 2002
555,000 $0.36 October 6, 2003
===============================================================
</TABLE>
Stock options are granted five years prior to the expiry date at
exercise prices that are based on market prices at the date of
grant.
(c) Share purchase warrants:
(i) The following non-transferable share purchase warrants were
outstanding at September 30, 1999:
<TABLE>
<CAPTION>
===============================================================
Number Exercise price
of Shares per share Expiry date
---------------------------------------------------------------
<S> <C> <C>
750,000 $0.92 October 24, 1999
90,000 $0.32 To November 19, 1999
$0.37 From November 20, 1999
to November 19, 2000
125,000 $0.60 To January 5, 2000
$0.75 From January 6, 2001
To January 5, 2001
600,000 $0.28 To January 14, 2000
$0.32 From January 15, 2000
to January 14, 2001
737,684 $0.265 U.S. To January 7, 2000
$0.305 U.S. From January 8, 2000
to January 7, 2001
2,491,500 $0.35 To January 7, 2000
$0.37 From January 8, 2000
to January 7, 2001
1,528,527 $0.383 U.S. To April 7, 2000
$0.385 U.S. From April 8, 2000
to April 7, 2001
3,000,000 $0.55 To April 14, 2000
$0.63 From April 15, 2000
to April 14, 2001
2,746,833 $1.64 U.S. To September 13, 2000
$1.89 U.S. From September 14, 2000
To September 13, 2001
---------------------------------------------------------------
</TABLE>
<PAGE>
SIDEWARE SYSTEMS INC.
(a Company in the Development Stage)
Consolidated Notes to Financial Statements, page 7
(expressed in Canadian dollars)
Nine months ended September 30, 1999
With comparative figures for the nine months ended October 31, 1998
(Prepared by management)
==============================================================================
6. SHARE CAPITAL (CONTINUED):
At October 31, 1998, 3,075,400 share purchase warrants were
outstanding and due to expire on November 7, 1998. At September
30, 1999, the Company was awaiting regulatory approval to have
these warrants extended to October 31, 1999, therefore, these
warrants are not disclosed as outstanding at September 30, 1999.
(ii) The following non-transferable share purchase warrants were
outstanding at October 31, 1998:
<TABLE>
<CAPTION>
===============================================================
Number Exercise price
of Shares per share Expiry date
---------------------------------------------------------------
<S> <C> <C>
3,075,400 $0.575 November 7, 1998
450,000 $0.465 April 16, 1999
3,000,000 $ 0.43 April 16, 1999
1,000,000 $ 0.92 To October 23, 1999
===============================================================
</TABLE>
Share purchase warrants are generally issued two years prior to
their expiry date.
(d) Special warrants:
(i) As at September 30, 1999 all special warrants had been
exercised.
(ii) At October 31, 1998, 500,000 special warrants were deemed to
have been exercised for one common share and one
non-transferable share purchase warrant. As at October 31,
1998 the corresponding common shares had not been issued. The
non-transferable share purchase warrants will have the
following terms:
<TABLE>
<CAPTION>
===============================================================
Number Exercise price
of Shares per share Expiry date
---------------------------------------------------------------
<S> <C> <C>
500,000 $0.92 To October 23, 1999
===============================================================
</TABLE>
(e) Shares issued for financial advisory and consulting services:
During the quarter ended September 30, 1999, 250,000 shares were
issued for services pursuant to a financial advisory and consulting
agreement. The shares were issued at a deemed value of $0.64 per
share.
<PAGE>
SIDEWARE SYSTEMS INC.
(a Company in the Development Stage)
Consolidated Notes to Financial Statements, page 8
(expressed in Canadian dollars)
Nine months ended September 30, 1999
With comparative figures for the nine months ended October 31, 1998
(Prepared by management)
==============================================================================
7. INCOME TAXES:
The Company has non-capital losses for income tax purposes of
approximately $10,155,000 which are available to reduce taxable income
of future years, the benefit of which has not been recorded in the
accounts and which expire as follows:
<TABLE>
<S> <C>
1999 $ 770,000
2000 1,285,000
2001 -
2002 650,000
2003 3,600,000
2005 2,200,000
2006 1,650,000
---------------------------------------------------------
$10,155,000
=========================================================
</TABLE>
8. LITIGATION:
The Company is engaged in the following litigation:
(a) During the year ended April 30, 1997, a former director of the
Company commenced legal proceedings against the Company for
$276,000 alleged to be owing to him for unpaid consulting fees and
funds loaned or advanced on behalf of the Company. The Company has
filed a defense and counterclaim.
(b) During the year ended April 30, 1997, four former directors
commenced legal proceedings against the Company and certain of its
present directors claiming unspecified damages for libel. The
Company has filed a defense.
(c) During the year ended April 30, 1996 the Company commenced legal
proceedings against former directors and officers of the Company,
companies related to a former director, and the Company's former
solicitors and auditors. The relief claimed included damages for
breach of fiduciary duty and negligence, an injunction preventing
the sale of a computer program named "E-Glue", and an order setting
aside a disputed general security agreement against the Company's
assets. 484117 B.C. Ltd., a company controlled by a former
director, filed a counterclaim alleging that the Company was
indebted to it in the amount of $1,495,594 as at November 4, 1994,
and seeking to enforce the disputed general security agreement. The
Company's former auditors filed a counterclaim for approximately
$50,000 alleged to be owing for professional services.
(d) On January 11, 1999 parties related to a former director commenced
proceedings against the Company claiming damages for abuse of
process. The Company has filed a defense and counterclaim.
While the ultimate outcomes of these claims are uncertain, management of
the Company believes it will be successful in defending these actions
and accordingly no amounts have been provided in these financial
statements.
<PAGE>
SIDEWARE SYSTEMS INC.
(a Company in the Development Stage)
Consolidated Notes to Financial Statements, page 9
(expressed in Canadian dollars)
Nine months ended September 30, 1999
With comparative figures for the nine months ended October 31, 1998
(Prepared by management)
==============================================================================
9. COMMITMENTS:
The Company has the following minimum lease payments under operating
leases for its premises:
<TABLE>
<S> <C>
1999 $ 118,000
2000 418,000
2001 428,000
2002 445,000
2003 379,000
---------------------------------------------------------
$1,788,000
=========================================================
</TABLE>
Pursuant to an agreement with a company with certain common shareholders
and directors of the Company, approximately $100,000 of these amounts
are recoverable for the fiscal years from 1999 to 2002, and
approximately $70,000 for the fiscal year ending 2003.
10. UNCERTAINTY DUE TO THE YEAR 2000 ISSUE:
The Year 2000 Issue arises because many computerized systems use two
digits rather than four to identify a year. Date-sensitive systems may
recognize the year 2000 as 1900 or some other date, resulting in errors
when information using year 2000 dates is processed. In addition,
similar problems may arise in some systems, which use certain dates in
1999 to represent something other than a date. The effects of the Year
2000 Issue may be experienced before, on, or after January 1, 2000, and,
if not addressed, the impact on operations and financial reporting may
range from minor errors to significant systems failure, which could
affect an entity's ability to conduct normal business operations. It is
not possible to be certain that all aspects of the Year 2000 Issue
affecting the entity, including those related to the efforts of
customers, suppliers, or other third parties, will be fully resolved.
<PAGE>
SIDEWARE SYSTEMS INC. SCHEDULE B
SHARE CAPITAL
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1999
COMMON SHARES
<TABLE>
<CAPTION>
$ PER
NUMBER SHARE $
<S> <C> <C> <C> <C>
June 1, 1999 Balance forward 41,561,070 $19,090,084
---------- -----------
Jul-Sep 1999 Options exercised 175,000 167,875
Jul-Sep 1999 Warrants exercised 1,287,400 609,450
Sep 1999 Shares issued for cash 2,746,833 6,652,692
Jul 1999 Financial advisory services 250,000 160,000
---------- -----------
Sep 30, 1999 Total for the quarter 4,459,233 7,590,017
---------- -----------
SHARE CAPITAL SEPTEMBER 30/99 46,020,303 $26,680,101
========== ===========
</TABLE>
<PAGE>
SIDEWARE SYSTEMS INC. SCHEDULE B
(CONTINUED)
OPTIONS GRANTED
DURING THE THREE MONTHS ENDED SEPTEMBER 30, 1999
Date: July 8, 1999
Exercise price: $2.33
Expiry date: June 17, 2004
<TABLE>
<CAPTION>
NAME NUMBER
<S> <C>
Allen, Mac 75,000
Burke, Jennifer 10,000
Capannelli, Lou 25,000
Dick, Leanne 10,000
Drdul, Cindy 10,000
Ford, Richard 10,000
Gaidacheva, Victoria 25,000
Heibein, Pam 10,000
Hildebrand, Paul 100,000
Jones, Owen 125,000
Kozicki, Peter 25,000
Alex, Mahon 10,000
Markwort, Michael 10,000
Murray, Tom 10,000
Peacock, Michael 50,000
Prosvirnitisin, Alex 40,000
Regis, Dee 10,000
Reilly, Tim 20,000
Rogers, Lisa 10,000
Russell, Marie 50,000
Schipper, Willem 10,000
Scott, Colin 10,000
Shackleford, Michael 10,000
Simpson, Richard 10,000
Speros, Jim 125,000
Sutherland, Grant 125,000
Tulloch, Jennifer 20,000
Wedel, John 50,000
Weinstein, Randy 10,000
White, Edward 25,000
Wickers, Meaghan 10,000
Wong, Malcolm 40,000
Zhang, John 10,000
</TABLE>
<PAGE>
QUARTERLY REPORT -- FORM 61
QUARTER ENDED SEPTEMBER 30, 1999
SIDEWARE SYSTEMS INC.
SCHEDULE C: MANAGEMENT DISCUSSION
PERIOD: JULY 1, 1999 TO NOVEMBER 29, 1999
1. DR. BEAN -- VERSION 3.0
Sideware released Version 3.0 of "Dr. Bean", the Company's electronic
Customer Relations Management ("eCRM") product. Dr. Bean 3.0 incorporates new
features and functions including Intelligent Routing, Collaborative Services,
AutoService, and Remote Administration features.
2. DR. BEAN -- VERSION 3.1
Sideware is nearing completion of Version 3.1 of Dr. Bean. Version 3.1 will
include further enhancements to the new features added to Version 3.0, and
will incorporate the Wizmaster feature, developed under contract by
BrainTech, Inc.
3. FINANCING
In September 1999, Sideware completed its most recent private placement,
raising approximately US$4.2 million.
4. IBM
Dr. Bean has been accepted into the Enterprise Growth Opportunity ("EGO")
program of IBM. Under the EGO program, Dr. Bean will be offered for sale to
potential purchasers of IBM's System 390.
6. ORACLE CORP.
Dr. Bean has been installed for testing purposes at the facilities of Oracle
Corp. in Virginia.
7. SAIC
The Company has entered into a contract with Science Applications
International Corp. ("SAIC") to develop a telephony integration system, which
will permit Dr. Bean to be used with telephone call centers.
8. STOCK INFORMATION
<PAGE>
Sideware stock has commenced trading through the OTC Bulletin Board, under
the symbol "SWDSF". In addition, Sideware stock is now trading in United
States dollars on the Canadian Venture Exchange under the symbol "SYD.U".
9. INVESTOR RELATIONS ACTIVITIES
Shareholders and interested persons can contact Richard Simpson or Jennifer
Burke at the Company by telephone at (604) 986-6121; fax at (604) 980-7121 or
by e-mail to [email protected] or [email protected]. Please visit our
website at sideware.com
LIST OF DIRECTORS AT NOVEMBER 29
OWEN JONES
GRANT SUTHERLAND
JAMES SPEROS
JAY NUSSBAUM
EDWARD WHITE
PETER KOZICKI
<PAGE>
FORM 20
SECURITIES ACT
REPORT OF EXEMPT DISTRIBUTION
Report of a distribution under section 74(2)(1) to (5), (8) to (10), 11(i),
(14), (16)(i), (18) or (23) to (26) of the SECURITIES ACT, R.S.B.C. 1996,
c.418 (the "Act"), section 128(a), (b), (c) or (e) to (h) of the Securities
Rules, B.C. Reg. 479/95 (the "Rules"), or, where required, under an Order
issued under section 76 of the Act.
1. Name, address and telephone number of the issuer of the security
distributed (the "Issuer"):
SIDEWARE SYSTEMS INC.
102 - 930 West 1st Street
North Vancouver, B.C.
V7P 3N4
Telephone Number: (604) 986-6121
2. State whether the Issuer is an exchange issuer (ie. Listed on the
Vancouver Stock Exchange, but not listed or quoted on any other stock
exchange or trading or quotation system in Canada).
The Issuer is an exchange issuer.
3. Describe the type of security and the aggregate number distributed:
Stock options on a total of 740,000 common shares, exercisable at a
price of $2.66 per share until October 4, 2004.
4. Date of the distribution(s) of the security.
November 25, 1999
5. Specify the section(s) of the Act or Rules and, if applicable, the date
of the discretionary order or the blanket order number under which the
distribution(s) of the security was made.
s. 74(2)(9) of the Act
6. If the distribution(s) of the security was made to 50 purchasers or
less, circle and complete clause (a) of this section. If the
distribution(s) of the security was made to more than 50 purchasers,
circle clause (b) of this section.
<PAGE>
2
(a)
<TABLE>
<CAPTION>
=======================================================================================================
Section of Act/Rules and
Full Name and Number of Price Per Total if applicable, Date of
Residential Address Securities Share Purchase Price Discretionary Order or
of Purchaser Purchased (Canadian $) (Canadian $) Blanket Order Number
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Alex Mahon 20,000 * * s. 74(2)(9)
601 - 1345 Nelson St.
Vancouver, BC
V6E 1J8
- -------------------------------------------------------------------------------------------------------
Neelam Dhat 20,000 * * s. 74(2)(9)
6020 Kathleen Avenue
Burnaby, BC
V5H 2S6
- -------------------------------------------------------------------------------------------------------
Michael Colen 200,000
10315 Thornbrush Land
Bethesda, Maryland
20814
- -------------------------------------------------------------------------------------------------------
Robert Dreskai 10,000 * * s. 74(2)(9)
201 - 1075 Bayclay St.
Vancouver, BC
V6E 1G5
- -------------------------------------------------------------------------------------------------------
John Dykstra 20,000 * * s. 74(2)(9)
2706 Pt. Grey Road
Vancouver, BC
V6K 1A6
- -------------------------------------------------------------------------------------------------------
Veronica Arias 10,000 * * s. 74(2)(9)
217 - 1955 Woodway Place
Burnaby, BC
V5B 4S5
- -------------------------------------------------------------------------------------------------------
Michelle McGregor 20,000 * * s. 74(2)(9)
4225 Quesner Drive
Vancouver, BC
=======================================================================================================
<PAGE>
3
V6L 2X5
- -------------------------------------------------------------------------------------------------------
Chris Hall 20,000 * * s. 74(2)(9)
5905 WoodSorrel Crt.
Burke, VA
22015
- -------------------------------------------------------------------------------------------------------
Lyn Gubster 25,000 * * s. 74(2)(9)
603 Beverley Drive
Alexandria, VA
22305-1302
- -------------------------------------------------------------------------------------------------------
May Huang 20,000 * * s. 74(2)(9)
204 - 868 West 16th Avenue
Vancouver, BC
V5Z 1T1
- -------------------------------------------------------------------------------------------------------
Vince Taylor 100,000 * * s. 74(2)(9)
110 College Court
New Westminster, BC
V3L 1K9
- -------------------------------------------------------------------------------------------------------
John Zhang 25,000 * * s. 74(2)(9)
1123 East 10th Avenue
Vancouver, BC
V5T 2B6
- -------------------------------------------------------------------------------------------------------
Grant Sutherland 250,000 * * s. 74(2)(9)
1600 - 777 Dunsmuir Street
Vancouver, BC
V7Y 1K4
=======================================================================================================
</TABLE>
* incentive option - no cash paid
(b) The issuer has prepared and certified a list of purchasers comprising
the same information required by clause (a) of this section and a
certified true copy of the list will be provided to the Commission
upon request.
N/A
<PAGE>
4
7. State the total dollar value (Canadian $) of the securities distributed
by the issuer to purchasers resident in British Columbia in respect of
which this report is filed.
Nil
8. State the name and address of any person acting as agent in connection
with the distribution(s) of the security, the compensation paid or to be
paid to the agent and the name(s) of the purchaser(s) in respect of
which the compensation was paid or is to be paid.
<TABLE>
<CAPTION>
==================================================================================
Name and Compensation Paid Price Per Share Name of Purchaser
Address of Agent (number and type (Canadian $)
of security and/or
cash amount)
(Canadian $)
----------------------------------------------------------------------------------
<S> <C> <C> <C>
N/A N/A N/A N/A
==================================================================================
</TABLE>
9. If the distribution of the security was under section 128(a) of the
Rules, state the number of different purchasers who acquired any
securities of the issuer under that section during the 12-month period
preceding the distribution of this security.
N/A
10. If the distribution of the security was made under section 128(h) of the
Rules, state
(a) the number of different purchasers who acquired securities of the
issuer under that section during the 12-month period preceding the
distribution of this security, and
N/A
(b) the total dollar value (Canadian $) of all securities of the issuer
distributed under that section (including the distribution of this
security) during the 12 month period preceding the distribution of
this security.
N/A
The undersigned hereby certifies that the statements made in this report are
true and correct.
<PAGE>
5
DATED at Vancouver, British Columbia, this 25 day of November, 1999.
SIDEWARE SYSTEMS INC.
Per: "Grant Sutherland"
--------------------------
Grant Sutherland
Director of the Company
IT IS AN OFFENCE FOR A PERSON TO MAKE A STATEMENT IN A DOCUMENT REQUIRED TO
BE FILED OR FURNISHED UNDER THE SECURITIES ACT THAT, AT THE TIME AND IN THE
LIGHT OF CIRCUMSTANCES UNDER WHICH IT IS MADE, IS A MISREPRESENTATION.
<PAGE>
APPENDIX 23C
SUMMARY FORM - INCENTIVE STOCK OPTIONS
COMPANY NAME: SIDEWARE SYSTEMS INC. SYMBOL: SYD
DATE: OCTOBER 21, 1999
1. NEW OPTIONS PROPOSED FOR ACCEPTANCE:
Date of Grant: October 4, 1999
<TABLE>
<CAPTION>
====================================================================================================
Name of Optionee Position Insider? No. of Exercise Expiry Date No. of Options
(Director/Sr. Yes or No Optioned Price (m/d/y) Granted in
Officer/ Shares Past 12 months
Employee/
Consultant)
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Grant Sutherland Sr. Officer Yes 250,000 $2.66 10/04/04 125,000
- ----------------------------------------------------------------------------------------------------
Michael Colen Consultant No 200,000 $2.66 10/04/04 Nil
- ----------------------------------------------------------------------------------------------------
Steve Peck Sr. Officer Yes 150,000 $2.66 10/04/04 Nil
- ----------------------------------------------------------------------------------------------------
Alex Mahon Employee No 20,000 $2.66 10/04/04 30,000
- ----------------------------------------------------------------------------------------------------
Veronica Arias Employee No 10,000 $2.66 10/04/04 Nil
- ----------------------------------------------------------------------------------------------------
May Huang Employee No 20,000 $2.66 10/04/04 Nil
- ----------------------------------------------------------------------------------------------------
John Zhang Employee No 25,000 $2.66 10/04/04 30,000
- ----------------------------------------------------------------------------------------------------
Chris Hall Employee No 20,000 $2.66 10/04/04 Nil
- ----------------------------------------------------------------------------------------------------
Lyn Gubster Employee No 25,000 $2.66 10/04/04 Nil
- ----------------------------------------------------------------------------------------------------
Michelle Mac Gregor Employee No 20,000 $2.66 10/04/04 Nil
- ----------------------------------------------------------------------------------------------------
John Dykstra Employee No 20,000 $2.66 10/04/04 Nil
- ----------------------------------------------------------------------------------------------------
Neelam Dhat Employee No 20,000 $2.66 10/04/04 Nil
- ----------------------------------------------------------------------------------------------------
Robert Dreskai Employee No 10,000 $2.66 10/04/04 Nil
- ----------------------------------------------------------------------------------------------------
Vince Taylor Employee No 100,000 $2.66 10/04/04 Nil
====================================================================================================
</TABLE>
Total Number of optioned shares proposed for acceptance: 890,000
2. AMENDED OPTIONS PROPOSED FOR ACCEPTANCE
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------
Name of No. of Optioned Amended Exercise Original Date New/Current
Optionee Shares Price of Grant Expiry Date
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Nil Nil Nil Nil Nil
- -------------------------------------------------------------------------------
</TABLE>
<PAGE>
2
3. OTHER PRESENTLY OUTSTANDING OPTIONS: (excluding those included in
item 2 above)
<TABLE>
<CAPTION>
=====================================================================================
Name of Optionee No. Of Optioned Exercise Original Date Expiry Date
Shares Remaining Price of Grant
- -------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Peter Kozicki 25,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Edward White 25,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Paul Hildebrand 100,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Michael Peacock 50,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Marie Russell 50,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Mac Allen 75,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Victoria Gaidacheva 25,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Alexander Prosvirnitsin 40,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Pam Heibein 10,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Malcolm Wong 40,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
John Wedel 50,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Richard Ford 10,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Meghan Wickers 10,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Randy Weinstein 10,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Michael Shackleford 10,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Colin Scott 10,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Alex Mahon 10,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Jennifer Tulloch 20,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Leanne Dick 10,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Jennifer Burke 10,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Dee Regis 10,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Cindy Drudl 10,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Lou Capannelli 25,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
John Zhang 10,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Tim Reilly 20,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Willem Schipper 10,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Lisa Rogers 10,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Tom Murray 10,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
<PAGE>
3
- -------------------------------------------------------------------------------------
Richard Simpson 10,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Grant Sutherland 125,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Owen Jones 125,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
James Speros 125,000 $2.33 06/17/99 06/17/04
- -------------------------------------------------------------------------------------
Michael Peacock 100,000 $1.14 04/14/99 04/14/04
- -------------------------------------------------------------------------------------
Tom Murray 100,000 $1.14 04/14/99 04/14/04
- -------------------------------------------------------------------------------------
Marie Russell 100,000 $1.14 04/14/99 04/14/04
- -------------------------------------------------------------------------------------
Lou Capannelli 25,000 $1.14 04/14/99 04/14/04
- -------------------------------------------------------------------------------------
Lisa Rogers 15,000 $1.14 04/14/99 04/14/04
- -------------------------------------------------------------------------------------
Tim Reilly 150,000 $1.14 04/14/99 04/14/04
- -------------------------------------------------------------------------------------
Richard Simpson 17,500 $1.14 04/14/99 04/14/04
- -------------------------------------------------------------------------------------
John Wedel 83,000 $1.14 04/14/99 04/14/04
- -------------------------------------------------------------------------------------
John Zhang 20,000 $1.14 04/14/99 04/14/04
- -------------------------------------------------------------------------------------
Alex Mahon 20,000 $1.14 04/14/99 04/14/04
- -------------------------------------------------------------------------------------
Richard Simpson 22,500 $1.35 04/29/99 04/29/04
- -------------------------------------------------------------------------------------
Michael Shackleford 20,000 $1.35 04/29/99 04/29/04
- -------------------------------------------------------------------------------------
Richard Ford 20,000 $1.35 04/29/99 04/29/04
- -------------------------------------------------------------------------------------
Meghan Wickers 20,000 $1.35 04/29/99 04/29/04
- -------------------------------------------------------------------------------------
Jennifer Tulloch 20,000 $1.35 04/29/99 04/29/04
- -------------------------------------------------------------------------------------
Paul Hildebrand 55,000 $1.35 04/29/99 04/29/04
- -------------------------------------------------------------------------------------
Cindy Drdul 20,000 $1.35 04/29/99 04/29/04
- -------------------------------------------------------------------------------------
Owen Jones 123,000 $0.36 02/12/97 02/12/02
- -------------------------------------------------------------------------------------
James Speros 250,000 $0.36 07/06/98 07/06/03
- -------------------------------------------------------------------------------------
Owen Jones 55,000 $0.36 07/06/98 07/06/03
- -------------------------------------------------------------------------------------
Collin Scott 10,000 $0.36 07/06/98 07/06/03
- -------------------------------------------------------------------------------------
Ajay Sidda 50,000 $0.36 07/06/98 07/06/03
- -------------------------------------------------------------------------------------
Mary Ellen Ajtony 5,000 $0.50 05/01/96 05/01/01
- -------------------------------------------------------------------------------------
Paul Hildebrand 100,000 $0.50 05/01/96 05/01/01
- -------------------------------------------------------------------------------------
Owen Jones 300,000 $0.50 05/01/96 05/01/01
- -------------------------------------------------------------------------------------
Peter Kozicki 50,000 $0.50 05/01/96 05/01/01
- -------------------------------------------------------------------------------------
Grant Sutherland 198,000 $0.50 05/01/96 05/01/01
- -------------------------------------------------------------------------------------
Edward White 100,000 $0.50 05/01/96 05/01/01
- -------------------------------------------------------------------------------------
<PAGE>
4
- -------------------------------------------------------------------------------------
Jennifer Tulloch 10,000 $0.50 05/01/96 05/01/01
- -------------------------------------------------------------------------------------
Peter James MacLean 30,000 $0.82 03/26/97 03/26/02
- -------------------------------------------------------------------------------------
Peter Kozicki 25,000 $0.70 12/16/97 12/16/02
- -------------------------------------------------------------------------------------
Jennifer Burke 20,000 $0.70 12/16/97 12/16/02
- -------------------------------------------------------------------------------------
Owen Jones 75,000 $0.70 12/16/97 12/16/02
- -------------------------------------------------------------------------------------
Grant Sutherland 75,000 $0.70 12/16/97 12/16/02
- -------------------------------------------------------------------------------------
Willem Schipper 40,000 $0.70 12/16/97 12/16/02
- -------------------------------------------------------------------------------------
Edward White 25,000 $0.70 12/16/97 12/16/02
- -------------------------------------------------------------------------------------
John McDonald 75,000 $0.70 12/16/97 12/16/02
- -------------------------------------------------------------------------------------
Jennifer Tulloch 20,000 $0.70 12/16/97 12/16/02
- -------------------------------------------------------------------------------------
Mary Ellen Ajtony 5,000 $0.70 12/16/97 12/16/02
- -------------------------------------------------------------------------------------
Tim Reilly 90,000 $0.70 12/16/97 12/16/02
- -------------------------------------------------------------------------------------
Paul Hildebrand 75,000 $0.70 12/16/97 12/16/02
- -------------------------------------------------------------------------------------
Leeanne Dick 5,000 $0.70 12/16/97 12/16/02
- -------------------------------------------------------------------------------------
Dee Regis 5,000 $0.70 12/16/97 12/16/02
=====================================================================================
</TABLE>
Total Number of shares optioned, including those proposed for acceptance in 1
and/or 2 above:
4,594,000
4. If optionees include Insiders, state the date on which the shareholder
meeting approving the options or amendments was held: JUNE 30, 1999
or alternatively, indicate if shareholders' approval must still be
obtained: N/A
5. If applicable, state the date of the press release announcing the grant
of options: October 4, 1999
6. State the total issued and outstanding share capital at the date of grant
or amendment: 47,466,695
7. State, as a percentage of the issued shares of the Company indicated in 6
above, the aggregate number of shares that are subject to incentive stock
options, including new options, amended options and other presently
outstanding options: 9.68%
8. If the new options are being granted pursuant to a stock option
plan, state the number of remaining shares reserved for issuance under
the plan: N/A
<PAGE>
5
9. If the Company has completed a public distribution of its securities
within six months of the date of grant, state the per share price paid by
the public investors: $ N/A
10. The stock option agreement is in accordance with Exchange Policy
23.2.10 and 23.4.1 for Venture Companies, which includes the following
provisions: (please check boxes)
/x/ a condition that the option is non-assignable and non-transferable;
/x/ the period (if any) within which the optionee's heirs or
administrators may exercise any portion of the outstanding option
does not exceed one year from the optionee's death;
/x/ the option may only be exercised while the optionee is a director,
officer, employee or consultant within a period of not more than 30
days after ceasing to be a director, officer, employee or
consultant;
/x/ a condition that shareholder approval to the grant of the options
shall be obtained prior to the exercise of the options granted to
Insiders;
/x/ a condition that shareholder approval shall be obtained in respect
of amendment to the agreement if the option as originally
constituted was approved by the shareholders or if the optionee is
an Insider of the company at the time of the proposed amendment; and
/x/ if the incentive stock option agreements grant options to
employees, a representation by the employer that the optionee is a
bona fide employee of the company, subsidiary or management company
providing services to the listed company (other than consultants
performing investor relations services).
11. If the grant of options is not in complete accordance with Policy 23 --
Director and Employee Stock Options, indicate where there are
deviations, and explain why a waiver of Exchange policy is in the best
interests of the company and the investing public.
------------------------------------------------------------------------
------------------------------------------------------------------------
Enforcement action by the Vancouver Stock Exchange, the British Columbia
Securities Commission or other regulatory authorities may result if a person
makes a statement in this document that, at the time, and in light of the
circumstances under which it was made, is a misrepresentation.
THIS DOCUMENT WILL BE PLACED IN THE COMPANY'S PUBLIC
FILE IN ACCORDANCE WITH THE TERMS OF THE COMPANY'S
LISTING AGREEMENT
<PAGE>
APPENDIX 23D
DECLARATION OF INCENTIVE STOCK OPTIONS
TO: The Canadian Venture Exchange
RE: SIDEWARE SYSTEMS INC. (the "Company")
(Name of Listed Company)
This Declaration certifies an application to the Canadian Venture Exchange
(the "Exchange") for acceptance for filing of the Incentive Stock Options
summarized in the Incentive Stock Options Summary Form attached hereto (the
"Filing").
The undersigned hereby certifies that:
1. The undersigned is a director and/or senior officer of the Company and
has been duly authorized by a resolution of the board of directors of
the Company to make this Declaration;
2. The Company is not an inactive company as defined in the Exchange's
Policy 11.2.1;
3. If the Company has undergone a Reverse Takeover as defined in the
Exchange's Policy 18.5, at least 30 days have elapsed from the later of
the closing of the Reverse Takeover and resumption of trading;
4. Any optionee being granted options under this Filing, that is providing
promotional or market-making services for the Company, is a director,
senior officer or bona fide employee of the Company;
5. The Filing is EITHER in all respects in accordance with the Exchange's
Policy 23 - DIRECTOR AND EMPLOYEE STOCK OPTIONS, in effect as of the
date of this Declaration, OR ANY DEVIATIONS ARE INDICATED ON THE
ATTACHED SUMMARY FORM;
6. As of the date of grant there were no material changes in the affairs
of the Company which were not publicly disclosed; and
7. The Company is not currently in default of its financial statement and
fee filing requirements with the British Columbia Securities
Commission.
8. The information on the attached INCENTIVE STOCK OPTIONS SUMMARY FORM
is true.
<PAGE>
Dated this 1st day of December, 1999.
Grant Sutherland
----------------------------------
Name of Director or Senior Officer
"Grant Sutherland"
Signature
Director
----------------------------------
Official Capacity
Enforcement action by the Canadian Venture Exchange, the British Columbia
Securities Commission or other regulatory authorities may result if a person
makes a statement in this document that, at the time, and in light of the
circumstances under which it was made, is a misrepresentation.
THIS DOCUMENT WILL BE PLACED IN THE COMPANY'S PUBLIC FILE
<PAGE>
SIDEWARE SYSTEMS INC. ANNOUNCE STOCK OPTIONS
FOR IMMEDIATE RELEASE - October 4, 1999
Vancouver, B.C. - Sideware Systems Inc. (symbol: SYD on the VSE) announces it
has granted stock options to purchase 890,000 common shares to its directors,
officers and employees. The stock options are exercisable at a price of $2.66
per share, priced in accordance with the policies of the Vancouver Stock
Exchange, for a term of five years from October 4, 1999. The granting of
these options is subject to regulatory acceptance.
ON BEHALF OF THE BOARD
"Grant Sutherland"
Grant Sutherland
Chairman
<PAGE>
SIGNATURES
Pursuant to the requirements of the SECURITIES EXCHANGE ACT OF 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Sideware Systems Inc.
"Grant Sutherland"
Date: December 10, 1999 By: Grant Sutherland, Chairman
