FORM 27
SECURITIES ACT
MATERIAL CHANGE REPORT UNDER SECTION 118(1)
OF THE SECURITIES ACT
ITEM 1. REPORTING ISSUER
Brocker Technology Group Ltd.
2150 Scotia Place
10060 Jasper Avenue
Edmonton, Alberta
T5J 3R8
ITEM 2. DATE OF MATERIAL CHANGE
September 17, 2000
ITEM 3. NEWS RELEASE
A press release was disseminated on September 25, 2000 through the
services of Canada News Wire.
ITEM 4. SUMMARY OF MATERIAL CHANGE
Brocker Technology Group Ltd. has entered into a Heads of Agreement to
acquire KyxPyx Technology Limited. Under the terms of the Heads of
Agreement the shareholders of the KyxPyx are to be issued preferred
shares of Brocker, with a nominal value, which will include a warrant to
purchase up to 1,000,000 shares of Brocker at a price of $6.40 per
share. In addition, the vendors are to be paid a 7% royalty on certain
revenues earned by KyxPyx, which royalties are to be used to purchase up
to 2,000,000 common shares over a 4 year period.
ITEM 5. COMPLETE DESCRIPTION OF MATERIAL CHANGE
Brocker Technology Group Ltd. has signed a Heads of Agreement dated
September 17, 2000, to purchase the outstanding shares of KyxPyx
Technology Limited. KyxPyx is a Vancouver, British Columbia based
company which has developed a real time bandwidth adaptive
multi-channelled media streaming system based on the company's
proprietary software. KyxPyx has also developed computer chip technology
for the delivery of these video streaming features.
In consideration for these shares of KyxPyx the Heads of Agreement
provides for Brocker to issue 1,000,000 preferred shares, which will
have a nominal value, each of which is to include a warrant to purchase
common shares of the Corporation at a price of $6.40 per share,
exercisable for a period of 3 years. In addition, Brocker is to pay 7%
royalty on all revenue generated from the computer chip technology.
Initially, the proceeds of this royalty are to be used to exercise
options to be granted by Brocker. The Heads of Agreement provides for
Brocker to grant options to purchase 500,000 common shares in each year
for the next 4 years; the exercise price of the options will be
dependent upon the market price at the date of grant. After the full
exercise or expiry of these options, the 7% royalty will be paid in
cash. In addition, Brocker has agreed to share with the vendors the
proceeds from the sale of Video Streaming Intellectual Property if such
sale is made within 12 months. If such a sale is completed within 6
months, the proceeds will be split 50% to KyxPyx and 50% to Brocker is
sales are completed in the next 6 months the proceeds will be split 30%
to KyxPyx and 70%
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to Brocker. Brocker will have the right to pay such proceeds by issuing
common shares based upon the 30 day average trading price prior to the
announcement of any such sale.
Two key employees of KyxPyx, Kiko Sato and Kelly Lee Myers, are to sign
3 year employment contracts, and are to be paid $50,000 and $10,000
signing bonuses, respectively.
The proposed purchase of the shares of KyxPyx are subject to a number of
conditions including completion of a formal agreement, completion of due
diligence by Brocker, Toronto Stock Exchange and other regulatory
approvals. There is no assurance that these conditions will satisfy and
that this transaction will be completed on the terms set out in the
Heads of Agreement or on any other terms.
ITEM 6. RELIANCE ON SECTION 118(2) OF THE SECURITIES ACT
Not applicable
ITEM 7. OMITTED INFORMATION
Not applicable.
ITEM 8. SENIOR OFFICER
Casey O'Byrne, Director of the Corporation is knowledgeable about this
material change and may be contacted respecting this Material Change at
(780) 429-1010, for further information.
ITEM 9. STATEMENT OF SENIOR OFFICER
The foregoing accurately discloses the material change referred to
herein.
DATED at the City of Edmonton, in the Province of Alberta, this 27 day of
September, 2000.
/s/ Casey O'Byrne
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CASEY O'BYRNE
Chairman
