SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10 - SB
GENERAL FORM FOR REGISTRATION OF SECURITIES
Pursuant to Section 12(b) or 12(g) of the Securities Exchange Act of 1934
Commission File Number
IVISION GROUP, LTD.
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(Exact name of registrant as specified in its charter)
Nevada 87-0609893
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(State or other jurisdiction of incorporation) (I.R.S. Employer
Identification No.)
1 Westmount Square, Suite 650 _Montreal, Quebec (Canada) H3Z 2P9
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (888) 600-4847, ext. 204
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Copy To:
J. G. McAllister
1487 East Thistle Downs Dr
Sandy Utah 84092
PH: (801) 572-6610
Securities to be registered pursuant to Section 12(b) of the Act: NONE
Title of each class Name of each exchange on which
To be so registered Each class is to be registered
N/A N/A
Securities to be registered pursuant to Section 12(g) of the Act:
Common Stock 11,509,000 $0.001 par value
(Title of class)
THE AGGREGATE MARKET VALUE OF VOTING STOCK HELD BY NON-AFFILIATES OF THE
REGISTRANT AS OF NOVEMBER 30, 1999 - $3,929,000
This is one of 25 pages.
Exhibit Index on Page 24
THE SECURITIES AND EXCHANGE COMMISSION HAVE NOT REVIEWED THIS FORM. NOR HAS IT
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GONE EFFECTIVE PURSUANT TO SECTION 12(G)OF THE SECURITIES EXCHANGE ACT OF 1934.
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IT IS BEING PROVIDED FOR INFORMATIONAL PURPOSES ONLY. ANY REPRESENTATION TO THE
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CONTRARY IS A CRIMINAL OFFENSE.
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Part I
Item 1 DESCRIPTION OF BUSINESS
INTRODUCTION
iVision Group, Ltd., a Nevada corporation (hereinafter "Registrant" or
iVision Group") through its subsidiaries, designs, develops, and implements
personalized business-to-business and business-to-consumer software applications
accessed via the internet. Applications are built and customized to meet the
needs of small, medium and large size companies for North American and European
market.
iVision Integral, Inc., a Canadian corporation, was founded in March of 1998
with the objective of developing personalized interactive applications for
television. When it became apparent that TV was not ready for large-scale
adoption, management redirected its efforts and expertise towards the Internet,
a medium that was experiencing phenomenal growth and had all of the
technological pre-requisites for personalized interactive communities.
iVision USA, a Delaware corporation, was founded in November 1998, was
formed as the holding company for the ownership, in the United States, of all of
the stock of iVision Integral, Inc.
A. GENERAL DEVELOPMENT
On January 27, 1999, iVision Group Ltd., a Nevada corporation, (f/k/a Engle
Mining Co., Inc.; hereinafter the "Company" and/or "iVision" and the context may
require) acquired 100% of the issued and outstanding shares of iVision USA Inc.,
a Delaware corporation, in exchange for 8,000,000 shares of Common Stock of the
Company, and, based upon that exchange, the shareholders of iVision USA Inc.
became the majority shareholders of the Company. As a part of that transaction,
the remaining corporate officers and directors of Engle Mining Co., Inc.,
resigned their respective positions. Subsequent to the change in control, the
majority shareholders of Engle Mining Co., Inc, authorized the change of the
Company's name to iVision Group Ltd. (see, "Certificate of Amendment, Engle
Mining Co. Inc." dated February 9, 1999, incorporated by this reference.) Note,
that from December of 1988 to the January 27, 1999 (the date of the acquisition
noted above), Engle Mining Co. was not engaged in any active business or
venture.
The Company's common stock has been traded on the NASD Bulletin Board under the
symbol "IVIG".
The Registrant's corporate offices are located at 1 Westmount Sq., Suite 650,
Montreal, Quebec (Canada) H3Z 2P9. Phone number 1(888) 600-4847, Ext. 204.,
where the Company presently operates its two wholly owned subsidiaries, iVision
USA, a Delaware corporation which is the operating company, and iVision
Integral, a Canadian corporation which is the research and development
operation.
B. BUSINESS
1. PRODUCTS AND SERVICES
The Company's business plan is to develop smart web sites on the World Wide
Web for itself and for others. The Company defines smart web sites as
communities which allow a member to obtain a personalized presentation and
information based on his/her preferences. These web sites are considered "smart"
because as a member increases the frequency of his/her visits to the site, the
presentation becomes increasingly personalized to match the members'
preferences. iVision has branded its "smart" sites as iVISION SMART-SIGHTS;
the Company is preparing appropriate trademark application. Through the
Company's iSolutions division, communities will be established for third
parties, sell and implement the BroadVision software and its own proprietary
e-commerce and marketing modules.
Communities
Members register for value added content, community interaction and
privileges enabling the Company to know its customer's preferences and track
their actions on the site and create individual profiles.
Infrastructure
The Company exploits a powerful environment based on Sun hardware, Unix
systems and Oracle databases which allow rapid development and real-time
operation of large-scale, personalized Internet applications. These systems
support large databases of users and content, high transaction volumes,
intelligent agent matching and easy integration with external network systems.
These characteristics enable the Company to quickly deploy secure, scaleable,
and flexible dynamic Web-commerce applications.
Instead of developing in-house programs, the Company sought out one of the
most outstanding, high performance, one-to-one marketing software packages
available: BroadVision`s One-to-One software. The use of third party software
allowed iVision to gain a significant lead over its competitors and has allowed
iVision to concentrate on the application of personalization software and
technology rather than the development of software.
BroadVision's One-to-One Enterprise software has the following features:
- - Designed for rapid development and real-time operation of large-scale,
personalized Internet, Intranet, and Extranet business applications
- - Contains tools for the development of applications with large user and
content databases, high transaction volumes, intelligent matching and
integration with existing business systems.
- - Incorporates a suite of management tools to manage content and dynamically
control application behavior.
- - Allows development and deployment of secure, scalable and flexible
e-commerce and knowledge management applications over the Internet or intranets.
In addition to the capabilities of BroadVision software, the Company has
developed its own proprietary modules which help facilitate the development of
marketing campaigns, contests, coupons and many aspects of an electronic
commerce transaction, such as ordering, shipping, customer support and inventory
control.
Hardware
The Company's technical architecture is based on SUN Enterprise Servers.
These servers are some of the most compatible, scalable and reliable line of
business servers. They are a single, binary-compatible product line featuring a
range of servers that scale from one to 64 processors, all running the SolarisTM
operating environment. The midrange servers of this family are the first in
their class to offer data center-level RAS capabilities (RAS stands for
Reliability, Availability and Serviceability) with dynamic reconfiguration and
alternate pathing for online repair and configuration, which minimize both
planned and unplanned downtime. All these systems use the UltraSPACR-II
processor with clock speed at 300 to 400MHz and soon 500MHz. The High-end
server of this family, the Sun Enterprise 10000 or Starfire, has the following
characteristics :
- - Up to 64 processors at 400 MHz each with 4MB of cache.
- - Up to 64GB of memory.
- - Up to 20 TB of disk array with RAID capabilities.
- - On-line hot swap of boards, power, and cooling components.
- - Redundant option for all hardware components.
Revenue sources
The company intends to derive its revenues from two principal sources:
1) iVISION SMART-SIGHTS (proprietary online communities):
i) online and print advertising sales
ii) online marketing campaigns
iii) online sale of products and services (e-commerce)
iVISION SMART-SIGHTS are the Registrant's proprietary communities that
offer engaging content, services and products that are personalized to each
members' specific preferences. The first iVISION SMART-SIGHT is CAMPLUS, a
community that is designed to appeal to students between the ages of 18 and 35.
CAMPLUS is marketed by distributing 500,000 copies of the CAMPLUS magazine to
students on college and university campuses across Canada. Members receive a
membership card, the magazine and access to the www.zonexy.com CAMPLUS
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membership cards will enable the user to obtain discounts on products and
services at participating merchants. To obtain discounts, members enter the
CAMPLUS web site and print discount coupons or present their member cards
directly at participating merchants.
2) iSOLUTIONS (web business consulting):
i) development of personalized interactive web sites for third parties
ii) hosting of web sites
iii) margins on third party software sales
The iSOLUTIONS division builds communities for third parties and for
iVision. iSOLUTIONS applies the expertise gained in building its own
communities to the development of communites for third parties. iSOLUTIONS also
sells and implements BroadVision software and its own proprietary e-commerce and
marketing modules. On larger projects iSOLUTIONS intends to partner with
established software integrators.
The Company's e-commerce modules function with BroadVision software and
permit integrated infrastructure management, sales and marketing support in
e-commerce transactions. These were designed to allow greater communication
between on-line payments, web-based call centers, billing and accounting, and
warehouse and inventory.
The Company also plans to offer integrated sales and marketing support that
will enable targeted affiliated programs with custom storefront, customer
support and interactive personalized marketing campaigns, chat rooms, discussion
groups and web based e-mail.
iVision hosts' and operates the web applications in its own data center.
Applications are configured to meet the needs of clients and they are packaged
with Internet access, security, back-up and operational support. Clients will
purchase access and use of the application from iVision. Four types of fee
options are expected to generate revenues for iVision:
Clients pay a consulting fee for the design, customization, and development
of Web applications.
Clients pay a monthly fee for the hosting and use of Web applications.
Clients pay user fees, which are based on traffic usage.
Monthly fees are applied for the ongoing support and operation &
maintenance of the application.
iVision specialized network was developed exclusively to host the customize
Web applications. The network incorporates a high level of redundancy and
enables real time back up of client sites. As a result, our clients benefit from
superior response time and solid reliability.
iVision has begun to build an inventory of proprietary libraries through
work done in previous projects. iVision service offering presently includes a
catalog of proprietary modules, a tested IT based development and production
process as well as a team of trained resources. These service elements provide
iVision with a unique competitive advantage over the competition.
The Company has also developed solid expertise in the areas of
personalization, interactive marketing, and Web site design and production. The
nature itself of iVision leads to many commercial Services and products and many
commercial opportunities. While one of the major competitive advantages of
iVision comes from its ability to offer the full range of services to its
prospective customers, on a turn key solution basis, it has also the ability to
exploit one or more of its full package services to generate revenues and to
attract competitors' customers and to gain name recognition.
iVision is capable of providing a wide range of consulting services, to
include: defining, developing and implementng E-business applications in
client organizations. Other services include project analysis & project
planning, project management, application development, testing, and back-office
integration. iVision provides multimedia design and production services which
are used to develop corporate Web interfaces. Services include; storyboarding,
interface design, graphic production, Web programming, and content development.
Services. These services will be billed on a per-project or hourly basis.
Today, iVision is capable of providing the entire hardware, software, and
network infrastructure necessary to implement and support E-business
applications. Services include the coordination of ongoing hardware purchases,
software licensing, and network enhancements, which guarantees reliability,
scalability, and security for customers. Contractual hosting services are billed
monthly. Hosting being a standardized service highly automated based on high
volume and low cost.
iVision has the opportunity to rime the sale of application templates based
of ZoneXY.com developed with BroadVision development tool kit to other
community-oriented sites. This will include the sale of service templates such
as text display modules, chat modules, bulletin board modules, marketing
modules, customer support modules, e-commerce modules, operation planning
applications, and methodology tools. Selling a site will generate various types
of revenues such as: license fees, hardware, consulting, project management, web
development, hosting and operations. The community model is becoming
increasingly popular and numbers of business community models exists to that
effect. Literature and books in the domain are becoming best sellers, as the
needs arise to create community of INTEREST on the net on which various players
can capitalize. The popularity of community sites will be directly proportional
to its capacity to adapt to the life form that the members of the community will
instill and to its capacity to adapt individually to each member. In that sense,
the "community model" built by iVision is a marketable product that can appeal
to various buyers, should they be social (government, organisms, etc.) or should
they be commercial (mass retailers such as Amazon.com or others).
2. MARKET DEVELOPMENT
The Company's business and marketing best explained in view of its
overall business objectives. The Company will offer flexible and evolutionary
business solutions, to develop dynamic web sites for small, medium and
large-size companies, by integrating animated graphics, in which the customer
can add new features (e.g., product catalogues and price lists) or
customization. It will also be possible to add electronic commerce features to
this solution, without having to start from scratch. This solution will address
business-to- business or business-to-consumer needs.
Developing web sites that will allow creating interest groups, by
integrating customization features that allow our customers to properly identify
the products or services that they whish to offer to their customers. This
solution will address the need to do one on one business. iVision will seek out
strategic alliances and partnerships that will facilitate the sale of marketing
campaigns and advertising.
Establish strategic alliances with related firms (e.g., Arthur Andersen,
Price Waterhouse, Sierra Systems consultants, etc.) that are well known
throughout medium and large-size companies and will help us to position our
e-commerce business solutions.
To assure that market development success and at the same time increase our
revenue, it is very important to precede with an acquisition of a complimentary
company who has a large client base with very good credibility in the IT
business. Therefore, that company needs to have an efficient marketing team to
obtain rapidly some web development success in the business-to-business and
business-to-consumer market.
The Registrant identified and successfully negotiated an agreement with
Dynasys Technologies inc., ("Dynasys") based in Montreal; Dynasys meets all of
the criteria identified by iVision's management as necessary for implementing
its marketing plans. Dynasys' management and marketing people have proven
their ability to develop a strong relationship with their clients and have
established excellent credibility in the Canadian and European markets. Dynasys
has created a strong network with upper management in many industries like
manufacturing, retailing, banking and many others. This communication network
is very important to take the lead in the Internet business solution provider.
The following paragraphs describe the history and background of Dynasys as
related to the Registrants' business marketing plan.
Dynasys Technologies was established in 1996 by a group of computer
specialists. These individuals provided Dynasys with substantial experience in
information technologies which allowed the company to enjoy early market
success. Today it has a team of thirty experts specialized in various
information processing fields. Its technical expertise and use of new leading
edge technologies have allowed Dynasys Technologies to quickly grow and gain
recognition in the industry.
Sales for fiscal 1998 increased by 70% to reach $4,200,000 CDN and net
profit is over 35%. Due to the growth of the new technologies (i.e.: intranet -
extranet, e-commerce, multimedia, etc.), even faster growth of overall
activities is anticipated in the future.
Dynasys offers a wide range of consulting services: strategic planning,
management, development, migration, and computer system maintenance using
auxiliary resources or outsourcing. Using this approach, Dynasys has been able
to provide for all of the needs of businesses that use information
technologies. The accomplishments and the experience gained has allowed
Dynasys to perfect leading edge technologies, such as the development of
client-server applications, the production of object-oriented systems, and the
design of intranet-extranet applications.
Finally, Dynasys places puts a lot of emphasis on research and
development, to encourage the creativeness of its personnel. Its Research and
Development group has already developed three products (ADAPT/2000, ADAPT/EURO
and TRANSLATE/400), that work on the IBM AS/400 technology platform.
Sectors of activities of Dynasys Technologies
Since its creation, Dynasys has observed a commercial strategy of varying
its sources of income, to ensure a balanced budget and allow for constant
growth. Today, Dynasys can count on its diverse commercial activities to
increase its market share. There are three sectors of activity:
1- Product Development and Marketing:
Dynasys Technologies develops and markets the products ADAPT/2000,
DAPT/EURO, TRANSLATE/400.
ADAPT/2000 is a solution that allows computer programs to securely and
functionally support the arrival of the year 2000.
ADAPT/EURO is a solution that allows adapting computer programs to support
the Euro currency.
TRANSLATE/400 is a completely automated tool that allows generating copies
of applications that work on the AS/400 technology platform, in a desired
language.
2- Consulting services:
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Dynasys offer a complete range of consulting services for all technology
platforms. This range of services addresses strategic consulting, systems
integration, and application support and evolution needs. As far as consulting
services go, our mission is to provide management with flexible, evolutionary,
and profitable business solutions.
3- Outsourcing:
With Dynasys, outsourcing involves taking over the responsibility for
information systems operations and equipment, and system software and
application software management from customers, at their own site or at Dynasys'
computer centers. This complete or partial transfer of computer operation allows
the Company's customers to dedicate themselves entirely to their mission and
meeting their objectives.
Dynasys Technologies' Clientele
Dynasys has carried out most of its mandates in the private sector,
specifically in the manufacturing, banking, distribution, and transportation
sectors. Several of our customers are industry leaders: Alcan, Provigo,
Reynolds, Financi re Banque Nationale, Standard Paper Box, Canadian National,
Star Data (Toronto), Calberson Transport (Paris), Frigidaire Canada and
Frigidaire USA, and Iron Ore. These business relations represent many stepping
stones for information technology projects, specifically in the newer
technologies, such as Web site development and electronic trade.
Dynasys Technologies' Marketing Strategy
In the Spring of 1999, Dynasys laid down its marketing strategy, which
can be summed up in three points:
1- Position the ADAPT/EURO product in the European market;
2- Target the U.S. market and implement the marketing plan for the tool
TRANSLATE/400 and distribute ATENOR testing tools;
3- Take advantage of the Company's knowledge and business relations to
penetrate the consulting services market in Europe.
To imlement the marketing plan, Dynasys put together a marketing team
which has many years of expertise in the world of computerized information
management. This sales team is made up of seven people who have mastered various
information technology related fields.
One of the first priorities is to position the tool called ADAPT/EURO,
which addresses the problems related to the introduction of the new currency in
Europe and North America. The Gartner Group's study indicates that there is
the potential generation of more than 100 billion dollars from the American
market and double of that amount from the European market. To take the lead for
the European market, Dynasys Technologies has associated itself with a French
partner, the Androne Group. This company is very present in the industrial and
financial markets, and the ADAPT/EURO solution is a major asset in penetrating
these markets. Dynasys has high hopes for this product, since it targets all
small, medium and large companies. This is where the its French partner will
have an important role to play, introducing Dynasys and its affilate, iVision
to their customers.
Also, since Androne Group is also very active in the consulting services
sector, this association allowed Dynasys Technologies to develop a new market
for its consulting services. Since this association, Dynasys has placed 15
consultants with mandates with Androne Group customers. Also, while taking
advantage of our European relations, Dynasys plans to place over 25 consultants
with mandates in Paris before the end of 1999.
The excellent collaboration between Dynasys and Androne Group has created a
different kind of partnership. Indeed, Androne Group has developed a
non-regression testing tool that the Dynasys had been searching for some time.
Dynasys has entered an agreement for the North American and European market
distribution of the testing product called ATENOR
Dynasys Technologies' other priorities will be the deployment of its
translation tool called TRANSLATE/400. Market globalization brings new users to
businesses. These users will have access to their different computer systems. In
many cases, they will speak a language other than the one used in developing
these systems. It therefore becomes imperative to have multi-language systems
that can adequately address this fact, while minimizing translation efforts and
costs. That's a reality for the American market with the new users speaking
Spanish. It's needful to give them the opportunity to work with the information
system in their native language.
Dynasys has therefore officially launched this product during the biggest
gathering of users of IBM AS/400 technology in San Antonio, Texas, at COMMON
FALL 99, where over 6,000 participants visited during three days. Dynasys also
took advantage of this event to launch the testing tool called ATENOR on the
market.
Dyasys displayed these two products at COMDEX FALL 1999, which was held
in Las Vegas, from November 15 to 19. This is the biggest information
technologies related event. Over 200,000 visitors from about one hundred
countries attended this event and visited with exhibitors to discover new and
innovative products.
ELECTRONIC COMMERCE
Since the beginning of 1999, Dynasys has been planning to develop an
electronic trade solution. It was felt that this solution would complete the
range of products and services the Company offers to its clients, and increase
the market share, while observing the Company's diversification philosophy. The
Company had the choice of developing a solution in-house or to see what was on
the market. The Company searched for a flexible and evolutionary business
solution to address the formidable electronic trade market.
After having analyzed several products, management of Dynasys selected the
iVision Group solution. After several meetings between management of Dynasys
and iVision, it was mutually determined that a business relationship between
the companies would position them to become one of leaders in the new
electronic trade market.
COMPETITION
Internet communities are extremely competitive and iVision is working to
develop a niche for what its management believes to be a unique approach to this
rapidly growing industry. As discussed above, the relationship with Dynasys is
part of that approach. Nonetheless, iVision is in the development stage and
faces competition from recognized, financially secure companies with greater
financial, managerial and other resources. Within the areas that define the
Registrant's business objectives (discussed above) iVision has identified the
following competitors:
iVillage
iVillage is a public company with a leading online women's network and one
of the most demographically targeted online communities on the World Wide Web
(see www.ivillage.com). iVillage's network, is an easy-to-use, comprehensive
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online network of sites tailored to fit the interests and needs of women aged 25
through 49, and provides advertisers and merchants with targeted access to women
using the Web. The network consists of 14 channels covering the leading topics
of interest to women online, such as family, health, work, money, food,
relationships, shopping, travel, pets and astrology.
Student Advantage
Student Advantage is a public company that prints a quarterly student
magazine and has a web site (www.studentadvantage.com) that targets college
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students. They have a national fee-based membership program with over 1,000,000
student members who receive benefits including ongoing discounts on products and
services offered by over 40 national partners and 12,000 partners in 115 local
markets. The studentadvantage.com Web site currently offers content, community
and e-commerce targeted to college students.
US Internetworking
US Internetworking is public company that produces large scale corporate
web sites (see www.usinternetworking.com). It is also an Application Service
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Provider (ASP) for BroadVision and other major companies. USi offers integrated
end-to-end solutions for Internet applications to mid-sized enterprise clients
for a flat monthly fee. The company is based in Annapolis Maryland and has
approximately 400 employees.
EMPLOYEES
As at November 1, 1999, the Company had approximately 30 employees either part
time or full time.
The Company uses a basic employment contract to protect the Company's trade
and proprietary secrets. The Company's employees are not party to any
collective bargaining agreements. The Montreal area has a relatively large pool
of people experienced in development and implementation of web sites. The
Company will use independent workers and consultants to fill any gap in its
workforce requirements. The Company believes its employee relations are good.
ITEM 2
MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
PLAN OF OPERATION
During the period January 27, 1999 to May 31, 1999, the period following
the acquisition of iVision USA, Inc., the Company's revenues were $0. During
this period the Company had a net loss of ($1,243,726). The Company funded this
loss through contributed capital and loans.
In order to successfully develop its business, the Company will require
additional capital to carry out its plans. The Company will seek to generate
such funds through the sale of securities either under a registration or
pursuant to an exemption with the possibility of institutional financing. The
Company is presently evaluating the merits of the various alternatives to fund
the Company's next phase of development and provide operating capital.
Management is confident that the Company be able to achieve the required equity
and/or debt necessary to achieve the Company's near term goals. However, the
Company does not presently have any financing arranged nor can there be any
assurance that an underwriter can be found on terms acceptable to the Company.
In the absence of such financing, the Company may be unable to put its plans
into effect.
The Company's business consists of two main activities: iVISION
SMART-SIGHTS (proprietary online communities) and iSOLUTIONS (web business
consulting).
The following strategies will be used to market iVISION SMART-SIGHTS:
The Company plans to market its online communities by distributing a
printed guide that will draw attention to the online community. In the case of
CAMPLUS, the printed guide is expected to be distributed to students on college
and university campuses by student representatives that are hired by the Company
and via inserts in student magazines that are distributed freely on campus. At
this point, the Company has not finalized any distribution agreements that will
guarantee the success of the distribution model. Beginning in the year 2000, the
Company expects to apply the same distribution model in the United States in
order to access the larger market.
The Company intends to increase its membership by building brand awareness.
The Company will identify all of its proprietary sites under the brand of
iVISION SMART-SIGHTS, which is in the process of being trade marked. All
iVISION SMART-SIGHTS will be accessible at the domain address of www.zonexy.com.
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The success of the Company's proprietary online communities is founded on the
protection of member profiles. In order to protect its members' privacy, the
Company has implemented a policy that treats the Company as custodian of the
members' profile information. Members have the option of withholding their
profile information or releasing it at their discretion. The Company believes
that its privacy policy is among the most protective in the business.
The Company will grow by acquiring other web sites with members and
content. In addition, the Company will seek out strategic alliances and
partnerships that will facilitate the sale of marketing campaigns and
advertising. The Company also intends to joint venture with advertising
agencies that will use their existing relationships to sell the Company's
products.
To date, the Company has entered into a limited number of strategic
alliances in order to build its communities, provide community-specific content,
generate additional traffic, increase membership and facilitate distribution.
The Company has developed innovative approaches to sell many of its
products. For example, rather than running traditional banner ads, the company
designs animated advertisements that captivate, appeal and entertain (for
examples, consult the DEMO at www.iv1.com).
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Concerning iSOLUTIONS, the Company employs the following strategies:
ISOLUTIONS will grow by acquiring companies with value added expertise or
established clienteles. ISOLUTIONS will also seek alliances with third parties
in the information consulting business that have privileged relationships and
elements that can speed up the delivery of projects.
On May 17, 1999, the Company agreed to acquire Javanaise Informatics
Services Corporation (herein after Javanaise), through its wholly owned
subsidiary, iVision USA Inc., a corporation organized under the laws of the
State of Delaware. Javanaise agreed to be acquired in exchange for 34,000 shares
of the common stock of iVision Group Ltd. and payments totaling $CAD 150,000.
Javanaise is a technology consulting company with expertise in the
implementation processes required for the development of web based projects.
This will help the Company develop iSOLUTIONS by obtaining consulting contracts
and working with third parties in the design and implementation of personalized
communities.
Based on present market conditions and the strong demand for personalized
communities that incorporate BroadVision software and the Company's proprietary
e-commerce and marketing modules, the Company expects that most of these
projects could be sold for $250,000 or more.
iSOLUTIONS will earn revenues from the sale of BroadVision software, development
fees, maintenance fees and hosting fees.
In May of 1999, the Company became an Application Service Provider and
reseller for BroadVision (software) Inc. This positions the Company as one of
the few solution providers for the clients of BroadVision. It also enables the
Company to earn a profit margin on sales of BroadVision software.
ITEM 3
DESCRIPTION OF PROPERTY
The Company presently occupies 6,686 square feet of office space in
Westmount, Quebec near the city of Montreal. The space is leased at the basic
rate of $10,469 CND per month from SITQ Real Estate. The term of the lease is
until April 1, 2001, renewable for an additional two years with a 6 month
notice. Additional costs to the Company include: electricity and supplemental
air conditioning costs associated with the server room at the rate of $285.00
CND per year per ton of refrigeration installed. The server room is
air-conditioned with a separate emergency power supply in the event of a power
failure. The server room has been certified by the National Bank of Canada as a
secure environment for the company's web servers and as an approved facility for
electronic commerce.
In addition to the above, the Company also maintains an office in
Wilmington, Delaware. This office serves as a temporary facility within an
executive center while the Company finds a suitable US location for its
operations. The office is leased for $ 6,200 US per year on a yearly basis with
automatic renewal unless there is 60 days notice before the anniversary. The
space is rented from Delaware Corporate Management Inc. (DCM).
ITEM 4
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information, as of November 30,
1999, with respect to stock ownership of each person known by the Company to be
the beneficial owner of more than five (5%) percent of the Company's outstanding
Common Stock. The following table additionally sets forth the ownership by each
director and all directors and officers as a group, and their percentage
ownership of Common Stock.
NAME AND ADDRESS OF NUMBER OF SHARES PERCENT OF
BENEFICIAL OWNERS OF 5%+ OF COMMON STOCK CLASS (1)
- --------------------------- ----------------- ----------
Vision Management Services LTD 4,000,000 34.76%
1 Westmount Square, Suite 650
Montreal, Quebec H3P 2Z9
Bear Bay Management (Caribbean) Inc. 2,600,000 22.59%
2500 Daniel-Johnson Blvd.,
Suite 1108
Laval, Quebec H7t 2P6
Den-O-Tech Technology Inc. 1,400,000 12.16%
2365 Marimier
Longueuil, Quebec
<PAGE>
NAME AND ADDRESS OF NUMBER OF SHARES PERCENT OF
DIRECTORS & OFFICERS OF COMMON STOCK CLASS (1)
- ---------------------- ----------------- ----------
Louis Pratt 0 0%
1228 Etienne-Blanchhar
Montreal, Quebec H2M 2L5
Jean Lavoie 0 0%
13343 Desjardins
Pierrefonds, Quebec H8Z 3H7
Victor Lacroix (1) 50,000 nil%
10330 Olympia
Montreal, Quebec H2C 2W2
Michael Palmer 250,000 2.17%
12 Strathearn S.
Montreal West, Quebec H4X 1X4
Guy Courcelle 10,000 nil %
420 Chemin des Patriotes S.
St-Hilaire, Quebec J3H 3G8
Andr Dorais 50,000 nil%
7185 Jean Bourdon Ave.
Montreal, Quebec H4K 1G7
Patrice Letailleur 0 0%
4365 Marcil ave.
Montreal, Quebec H4A 2Z9
___________________________
All corporate officers and directors
as a group (5 persons) including stock
attributable to them: 2,960,000 25.27%
* Mr. Lacroix owns 50% of Bear Bay Holding Canada Inc. which owns 2,600,000
shares of the Company.
November 30, 1999. As of said date, the Company has not issued any shares of its
stock other than Common Stock.)
ITEM 5
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONA
The Directors and Executive Officers of the Company are as follows:
NAME TITLE POSITION HELD SINCE AGE
- ---- ----- --------------------- ---
Louis Pratt President, CEO and Director Sept. 1999 36
Michael Palmer Director March 1998 41
Jean Lavoie Vice-President of Sales and Marketing March 1998 38
Andre Dorais - Director, Corporate Counsel January 1999 48
Victor Lacroix Director March 1998 37
Guy Courcelle Director March 1998 38
LOUIS PRATT- PRESIDENT, CEO AND DIRECTOR
Education:
1986 Graduated Herzing Institute with a C.E.C. Progammer/analyst
degree.
M. Pratt is presently the President and one of the founders of Dynasys
Technologies, Inc., which is described herein in detail.
Sept. 1999 to present, President and CEO of iVision Group, Inc.
1996- present, President Dynasys Technologies, Inc.
1995-1996 President, Prolotech Technologies, Inc.
1994-1995 President, Louis Pratt Information, Inc.
1989-1994 Analyst and project manager for Provigo Distribution, Inc.
JEAN LAVOIE - V. PRESIDENT, SALES AND MARKETING
EDUCATION:
1982-1989 Montreal University, Bachelor's degree in information management
systems.
1978 Jonquier College, DE.C Computer system
Sept. 1999 - present Vice-president Sales & Marketing, iVision Group, Inc.
Aug. 1997-present Dynasys Technologies inc., Vice-president Business
development
1994-1997 APG Solutions & Tecnologies, Inc., Senior director,
business development
1993-1994 AT&T Global Information Solutions, President
MICHAEL PALMER - DIRECTOR
Education:
1988 Concordia University (Montreal, Quebec)
M.A. (Educational Technology)
1987 Concordia University (Montreal, Quebec)
Graduate Diploma in Instructional Technology
1984 McGill University (Montreal, Quebec)
Bachelor of Social Work
As the Director of Business Development, Mr. Palmer is responsible for the
coordination and development of business relationships and opportunities.
1988 - 1998 On/Q Corporation - Vice-President Marketing & Partner
Responsible for the design and management of multimedia productions as well as
marketing, sales, business development, distribution, and customer relations.
Produced applications on numerous multimedia formats including: CD-ROM, Digital
Video Interactive, Interactive Video, Compact Disc-interactive, Photo-CD,
CD-Video, and the World Wide Web.
ANDRE DORAIS - DIRECTOR, CORPORATE COUNSEL
Education:
1977-1978 Sherbrooke University (Sherbrooke, Quebec),
M.Sc.(Fiscal Studies)
1976 Quebec Bar, Member of the Bar of Quebec
1975 University of Montreal (Montreal, Quebec)
Bachelor of Law (LL.L .)
1972 H.E.C. (Hautes tudes Commerciales, Montreal, Quebec),
B.A. (Accounting)
Mr. Dorais is a Montreal based lawyer with an international corporate law
practice. Mr. Dorais counsels the Board of Directors of iVision in all legal
matters. Mr. Dorais has been operating his own private practice since 1984.
VICTOR LACROIX - DIRECTOR
Education:
1985 - 1988 University of Montreal (Montreal, Quebec),
M.Sc. (Anthropology)
1982 - 1985 University of Montreal (Montreal, Quebec)
B.Sc. (Science)
1979 - 1982 Ahuntsic College (Montreal, Quebec)
DEC Pure and Applied Sciences)
Mr. Lacroix is one of the founders and currently the President and CEO of Bear
Bay Holding Canada Inc., a diversified financial corporation with interests in
mutual funds and venture capital financing. The company maintains offices in
Canada, Europe and Barbados.
1995 - present Bear Bay Holding Canada Inc., President and CEO
1993 to 1995 Self employed, Financial Planner
1988 - 1993 Sun Life of Canada, Financial Planner
GUY COURCELLE - DIRECTOR
Education:
1977 - 1980 Gembloux University (Gembloux, Belgium)
B.Sc. (Agriculture)
Mr. Courcelle is the Executive Director of Bear Bay Holding Canada, Inc. He is
in charge of European business development for the company, which is a
diversified financial corporation with interests in mutual funds and venture
capital financing. The company maintains offices in Canada, Europe and
Barbados.
1999 - present Bear Bay Holding Canada
1995 - 1998 Self Employed, Business consultant
1988 - 1995 CDV Packaging Inc.
LTEM 6
EXECUTIVE COMPENSATION
The Company's compensation policy is to pay its executives in the middle
salary range for similar positions being offered elsewhere. The Company
attracts its employees with a generous stock options plan. The following table
lists the top three salaried employees as of November 1, 1999.
SUMMARY COMPENSATION TABLE
- ----------------------------
Name Position Salary Options
- ---- -------- ------ -------
Louis Pratt President & CEO $80,000 50,000
Michael Palmer Vice-President Production $80,000 250,000
Jean Lavoie Vice-President Sales $80,000 -0-
and Marketing
LTEM 7
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
There are no related party transactions.
ITEM 8
DESCRIPTION OF SECURITIES
The following is a summary of certain provisions of the Company's Articles
of Incorporation, as amended, and rights accorded to the holder's of Common
Stock, generally and as a matter of law and does not purport to be complete. It
is qualified in its entirety by reference to the Articles of Incorporation, as
amended and Nevada Corporation Law (Exhibits 3.1, which are incorporated by
reference)
In accordance with the Company's Articles of Incorporation, as amended, the
total number of voting common stock authorized that may be issued by the Company
is 100,000,000 shares of stock with a par value of $0.001 per share and no
other class of common stock shall be authorized. Each of said shares shall have
equal voting-rights, shall not have cumulative voting rights and said shares may
be issued by the Company from time to time upon such terms and conditions and
for such consideration as may be determined by the Board of Directors.
Subject to the provisions of the Articles of Incorporation, as amended, and
to applicable law, dividends on the outstanding shares of common stock of the
Company may be declared in such amounts and at such time or times as the Board
of Directors may determine. Before payment of any dividend, there may be set
aside out of the net profits of the Company available for dividends, such sum or
sums as the Board of Directors from time to time, in its absolute discretion,
deems proper as a reserve fund to meet contingencies, or for equalizing
dividends, or for repairing or maintaining any property of the Company, or for
such other purpose as the Board of Directors shall think conducive to the
interests of the Company and the Board of Directors may abolish such reserve.
If the Company is liquidated, dissolved, and wound up for any reason,
distribution of the Company's assets upon liquidation will be made to the
holders of shares of Common Stock on a pro rata basis. A consolidation or
merger of the Company with another company, or the sale of all or substantially
ail of the Company's assets, is not deemed a liquidation, distribution or
winding up for this purpose.
<PAGE>
PART II
ITEM I
MARKET PRICE OF DIVIDENDS ON THE REGISTRANT'S COMMON
EQUITY AND OTHER SHAREHOLDER MATTERS
The Company does not intend to declare any dividends at this time.
The principal market for the Company's securities is the Over-The-Counter,
Bulletin Board (OTC BB) managed by the National Association of Securities
Dealers (NASD). The Company's stock is traded under the symbol "IVIG".
The source of the information below was provided by the National Quotation
Bureau and reflects inter-dealer prices, without retail mark-up, mark-down or
commission and may not represent actual transactions and have not been adjusted
for stock splits or dividends.
Period High Bid Low Bid
- ------ --------- ---------------
January 1999 - March 1999 2.9375 1.125
April 1999 - June 1999 4.00 2.00
July 1999- September 1999 2.37 1.00
PART II
ITEM 2
LEGAL PROCEEDINGS
There is one pending action, filed in the Courts for the Province of
Quebec, District of Montreal, which has been filed asserting a claim against
iVision USA, Inc., a wholly owned subsidiary of the Company. This action is
based upon the plaintiff's claim of breach of a commercial contract. The
plaintiff is claiming damages in the amount of $54,625 CND. It is too early
to assess the exposure that the subsidiary may have from this claim, however, in
the opinion of the Company's management, the total amount of the claim does not
present a significant financial exposure to the Company or its subsidiary. To
the best information of Company's management, there are no other pending or
threatened legal proceedings by or against the Company.
PART II
ITEM 3
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
From 1997 to date, the Company's principal accountant is Andersen,
Andersen & Strong, L.C. of Salt Lake City, Utah. The firm's report for the
period from inception to December 31, 1998 did not contain any adverse opinion
or disclaimer, nor were there any disagreements between management and
the Company's accountants.
PART II
ITEM 4
RECENT SALES OF UNREGISTERED SECURITIES
On January 26, 1999, the Company issued the following shares these
individuals as consideration for the exclusivity of their services and for
services performed:
Name Position then Held Shares
- ---- -------------------- ------
Michael Palmer Chief Operating Officer 250,000
John Schwinghamer Chief Financial Officer 200,000
David Kassar Director of Sales 50,000
In addition, on the same date the Company issued 170,000 shares to 3561593
Canada Inc. for the performance of financial services. The above shares were
estimated to be worth $1.00 per share at the time of their issuance.
On January 27, 1999, the Company acquired 100% of the issued and outstanding
shares of iVision USA Inc., a Delaware corporation, in exchange for 8,000,000
shares of Common Stock of the Company, and, based upon that exchange, the
shareholders of iVision USA Inc. became the majority shareholders of the
Company.
In addition to the foregoing, the Company has issued, in isolated
transactions, the restricted common stock, as follows:
1. Acquisition of Janvanaise Informatics Services Corporation Inc.
---------------------------------------------------------------------
("Javanaise Co.")
-----------
On September 1, 1999, the Company acquired form Alain Bergeron and Helene Julien
all the issued and outstanding shares of Bergeron Conseils et Realisations Inc.
("Bergeron Co."), which sole activity consists of holding 50% of all the issued
and outstanding shares of Javanaise Co., and from La Societe de Gestion, Louis
Martin Inc., the other 50% of all the issued and outstanding shares of Javanaise
Co. The purchase price for all the above mentioned shares was $150.000.00 CND,
which amount is fully paid as of the date hereof, and the issuance in favor of
Alain Bergeron and Helene Julien of 34,000 shares of Common Stock of the
Company, 17,000 of which were remitted to them on September 1, 1999 and the
other 17,000 shares remitted to a trustee which shall, upon completion of
certain conditions, release the same to Alain Bergeron and Helene Julien in the
two (2) years following the acquisition date (September 1, 1999).
Javanaise Co. is an information technology consulting corporation
specialized principally in the field of developing new software programs which
rendered several services to the Company before its acquisition. Its president
(Alain Bergeron) and other employees became, after the acquisition date,
employees of the Company.
2. Acquisition of Ixiem Productions Inc. ("Ixiem")
----------------------------------------------------
On September 15, 1999, the Company acquired from Francois Charron and
Schlagalack Inc. all the issued and outstanding shares of IXIEM! Productions
Inc., a Canadian corporation, in exchange for 200,000 shares of the Company's
restricted common stock. Said stock is subject to certain contractual
post-agreement conditions.
PART II
LTEM 5
LDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company's Articles and By-Laws provide for indemnification for
liability, including expenses incurred in connection with a claim of liability
arising from having been an officer or director of the Company for any action
alleged to have been taken or omitted by any such person acting as an officer or
director, not involving gross negligence or willful misconduct by such person.
Section 78.751 of the Nevada General Corporation Law allows the Company to
indemnify any person who was or is threatened to be made a party to any
threatened, pending, or completed action, suit, or proceeding, by reason of the
fact that he or she is or was a director, officer, employee or agent of the
Company, or is or was serving at the request of the Company as a director,
officer, employee, or agent of any corporation, partnership, joint venture,
trust, or other enterprise. The Company's bylaws provide that such person shall
be indemnified and held harmless to the fullest extent permitted by Nevada law.
Nevada law permits the Company to advance expenses in connection with
defending any such proceedings, provided that the indemnity undertakes to repay
any such advances if it is later determined that such person was not entitled to
be indemnified by the Company. The Company's bylaws require that the Company
advance such funds upon receipt of such an undertaking with respect to
repayment.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers, and controlling persons of the Company
pursuant to the foregoing provisions or otherwise, the Company has been advised
that, in the opinion of the Securities and Exchange Commission, such
indemnification is against public policy as expressed in such act, and is
therefore unenforceable.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
IVISION GROUP, LTD.
(REGISTRANT)
/s/ Victor Lacroix
BY:______________________________________
Victor Lacroix, Director
DATED: 30 DAY OF November, 1999
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities indicated on the 30 day of
November, 1999
/s/ Victor Lacroix
_____________________ Director and Chairman
/s/ Andre Dorias
_____________________ Director and Treasurer
/s/ Lousi Pratt
_____________________ Director
<PAGE>
25
PART III
ITEM I
INDEX TO EXHIBITS
The following documents are filed as part of this Registration Statement:
Item Number Item Description
(a) Financial Statements
Reports of Independent Certified Public Accountants (audited)
Balance Sheets as of December 31, 1998; and the statements of operations,
stockholders' equity, and cash flows for the years ended December 31, 1998, and
1997 and the period February 19, 1986 (date of inception) to December 31, 1998.
Notes to Financial Statements
Report of Independent Certified Public Accountant (unaudited)
Consolidated Financial Statements, the compiled balance sheet of iVision Group
LTD and Subsidiaries as of September 30, 1999, and the related statement of
income for the nine months then ended.
Notes to Consolidated Financial Statements
(b) Exhibits Required by Item 601 of Regulation SK
3.1 Articles of Incorporation and Amendments
3.2 By-Laws
4 Instruments defining rights of security holders,
including indentures.
None.
9 Voting Trust Agreement
None
10 Material Contracts
10.1 Share Purchase Agreement, IXIEM!
10.2 Share Purchase Agreement, Javanaise
21 List of Subsidiaries of iVision Group Ltd.
NAME Domicile
---- --------
iVision Integral, Inc. Canada
iVision USA, Inc. Delaware
27.1 Financial Data Schedule
27.2 Financial Data Schedule
<PAGE>
[LETTERHEAD OF ANDERSEN ANDERSEN & STRONG]
Board of Directors
I Vision Group LTD and Subsidiaries
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We have compiled the accompanying balance sheet of I Vision Group LTD and
Subsidiaries as of September 30, 1999 and the related statement of income for
the nine months then ended, in accordance with Statements on Standards for
Accounting and Review Services issued by the American Institute of Certified
Public Accountants.
A compilation is limited to presenting in the form of financial statements
information that is the representation of management. We have not audited or
reviewed the accompanying financial statements and, accordingly, do not express
an opinion or any other form of assurance on them.
Management has elected to omit selected notes to the financial statements and
the statement of cash flows required by generally accepted accounting
principles. If the omitted disclosures and statement of cash flows were included
in the financial statements, they might influence the user's conclusions about
the Company's financial position, results of operations, and cash flows.
Accordingly, these financial statements are not designed for those who are not
informed about such matters.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. The Company 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 4. These financial statements do not include
any adjustments that might result from the outcome of this uncertainty.
/s/ ANDERSEN ANDERSEN & STRONG
November 30, 1999
Salt Lake City, Utah
<PAGE>
I VISION GROUP LTD AND SUBSIDIARIES
( DEVELOPMENT STAGE COMPANIES)
CONSOLIDATED BALANCE SHEET
SEPTEMBER 30, 1999
<TABLE>
<CAPTION>
<S> <C>
ASSETS
CURRENT ASSETS
Cash. . . . . . . . . . . . . . . . . . . . . . . . . . $ 59,490
Accounts receivable - related parties . . . . . . . 20,966
Accounts receivable . . . . . . . . . . . . . . . . . 190,315
Prepaid expenses. . . . . . . . . . . . . . . . . . . 14,648
-----------
Total Current Assets . . . . . . . . . . . . . . 285,419
-----------
EQUIPMENT - net of accumulated depreciation . . . . . . 261,861
-----------
GOOD WILL - Notes 3 and 4 . . . . . . . . . . . . . . . 235,858
-----------
$ 783,138
===========
LIABILITIES AND STOCKHOLDERS'
EQUITY
CURRENT LIABILITIES
Note payable - related parties. . . . . . . . . . . $ 101,000
Accounts payable - related parties. . . . . . . . . . . 960,193
Accounts payable. . . . . . . . . . . . . . . . . . 162,847
-----------
Total Current Liabilities . . . . . . . . . . . . . . . 1,224,040
-----------
STOCKHOLDERS' EQUITY
Common stock
100,000,000 shares authorized, at $0.001 par
value; 11,268,000 shares issued and outstanding 11,268
Capital in excess of par value. . . . . . . . . . . . . 356,796
Deficit accumulated during the
development stage . . . . . . . . . . . . . . . . . . . (808,966)
-----------
Total Stockholders' Deficiency. . . . . . . . . . . . . (440,902)
-----------
$ 783,138
===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
I VISION GROUP LTD AND SUBSIDIARIES
( DEVELOPMENT STAGE COMPANIES)
CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1999
AND THE PERIOD DECEMBER 15, 1998
(DATE OF INCEPTION OF I VISION USA, INC,) TO SEPTEMBER 30, 1999
<TABLE>
<CAPTION>
(NOTE 3)
DEC 15, 1998
SEPT 30, (DATE OF INCEPTION) TO
1999 SEPT 30, 1999
---------------------- ------------------------
<S> <C> <C>
REVENUES. . . . . . $ 3,524 $ 417,897
EXPENSES. . . . . . 1,138,389 1,226,863
---------------------- ------------------------
NET LOSS. . . . . . $ (1,134,865) $ (808,966)
====================== ========================
NET LOSS PER COMMON
SHARE
Basic . . . . . . $ (0.11)
----------------------
AVERAGE OUTSTANDING
SHARES
Basic. . . . . 10,260,000
----------------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
I VISION GROUP LTD AND SUBSIDIARIES
( DEVELOPMENT STAGE COMPANIES)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
PERIOD FROM FEBRUARY 19, 1986 (DATE OF INCEPTION)
TO SEPTEMBER 30, 1999
<TABLE>
<CAPTION>
COMMON STOCK CAPITAL In
------------------ EXCESS OF ACCUMULATED
SHARES AMOUNT PAR VALUE DEFICIT
---------- ------- ----------- ------------
<S> <C> <C> <C> <C>
BALANCE FEBRUARY 19, 1986 (date of inception) . . - $ - $ - $ -
Issuance of common stock for cash
at $.025 - June 24, 1988 . . . . . . . . . . . . 720,000 720 17,280 -
Issuance of common stock for cash
at $.025 - August 20, 1988. . . . . . . . . . . 600,000 600 14,400 -
Issuance of common stock for cash
at $.025 - September 19, 1988 . . . . . . . . . . 200,000 200 4,800 -
Issuance of common stock for cash
at $.025 - November 30, 1988 . . . . . . . . 600,000 600 14,400 -
Issuance of common stock for cash
at $.025 - December 16, 1988. . . . . . . . 200,000 200 4,800 -
Net operating loss for the year ended
December 31, 1988. . . . . . . . . . . . . . - - - (58,000)
Issuance of common stock for cash
at $.20 - April 25, 1998 . . . . . . . . . . 44,000 44 8,756 -
Net operating loss for the year
ended December 31, 1998 . . . . . . . . . . . . . - - - (10,000)
---------- ------- ----------- ------------
BALANCE DECEMBER 31, 1998 . . . . . . . . . . . . 2,364,000 2,364 64,436 (68,000)
Issuance of common stock for all stock
of I Vision USA Inc. - January 27, 1999. . . 8,000,000 8,000 (64,436) 393,899
Note 3
Issuance of common stock for services
at $0.10 - February 8, 1999. . . . . . . . . . 670,000 670 6,030 -
Issuance of common stock as part payment for all
stock of Bergeron Conseils Et Inc. and
La Societe De Serices - September 1, 1999 . . 34,000 34 50,966 -
Issuance of common stock for all stock of
Xiem Productions Inc. - September 15, 1999. . 200,000 200 299,800 -
Net operating loss for the nine months ended
September 31, 1999. . . . . . . . . . . . . . - - - (1,134,865)
BALANCE SEPTEMBER 30, 1999. . . . . . . . . . . . 11,268,000 $11,268 $ 356,796 $ (808,966)
========== ======= =========== ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
I VISION GROUP LTD AND SUBSIDIARIES
( DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION
The Company was incorporated under the laws of the state of Nevada on February
19, 1986 with authorized common stock of 10,000,000 shares with par value of
$.0025. On April 15, 1998 the authorized common stock was increased to
100,000,000 shares with a change in par value to $0.001 and on February 9,
1999 the Company changed its name to I Vision Group Ltd.
On April 15, 1998 the Company completed a reverse common stock split of two
shares of its outstanding stock for one share and on January 8, 1999 a forward
common stock split of one share of outstanding stock for four shares. This
report has been prepared showing after stock split shares with a par value of
$0.001 from inception. The company has been in the development stage since
inception and has been primarily engaged in the business of developing mining
properties and during 1988 the company ceased operations and remained inactive
until 1998. See note 3.
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
- -------------
At December 31, 1998, the Company (without its subsidiaries) had a net operating
loss carry forward of $68,000. 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. The loss carryforward
will expire beginning in years 2004 though 2019.
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.
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>
I VISION GROUP LTD AND SUBSIDIARIES
( DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Foreign Currency Translation
- ------------------------------
Part of the transactions of the Company were completed in a foreign currency 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. If a completed transaction has a balance sheet date between a later
settlement date, resulting in a gain or loss, the amount is reported in the
current period income statement.
Financial instruments
- ----------------------
The carrying amounts of financial instruments, including cash, accounts
receivable, equipment, 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 liquidation of the Company.
Earnings (Loss) Per Share
- ----------------------------
Earnings (loss) per share amounts are computed based on the weighted average
number of shares actually outstanding, after the stock splits, in accordance
with FASB statement No 128.
Principals of Consolidation
- -----------------------------
The consolidated financial statements shown in this report includes the
accounts of the Company and its wholly owned subsidiaries as outlined in notes
3 and 4. All material intercompany accounts and transactions have been
eliminated.
3. ACQUISITION OF OUTSTANDING STOCK OF I VISION USA INC.
On January 27, 1999 the Company acquired all of the outstanding stock of I
Vision USA Inc. through a stock for stock exchange in which the stockholders of
I Vision USA Inc. received 8,000,000 common shares of the Company in exchange
for all of the stock of I Visions USA Inc. I Vision USA Inc. was organized
in the state of Delaware on December 15, 1998 and had purchased all of the
outstanding stock of I Vision Integral Inc. which was organized in Canada
during March 1998. I Vision USA Inc. and I Vision Integral Inc. were organized
for the purpose of conducting electronic commerce on the World Wide Web. The
assets held by I Vision USA Inc. and I Vision Intregal Inc. consists of
computer software and hardware.
After the completion of the acquisition the outstanding stock of the Company was
11,034,000 common shares of which 77% was owned by related parties.
For reporting purposes, the acquisition is treated as an acquisition of the
Company by I Vision USA Inc. (reverse acquisition) and a recapitalization of I
Vision USA Inc. The historical financial statements prior to January 27, 1999
are those of I Vision USA Inc. and its subsidiary I Vision Integral Inc. Good
Will was recognized from the acquisition. See note 4.
<PAGE>
I VISION GROUP LTD AND SUBSIDIARIES
( DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
4. ACQUISITION OF ALL OUTSTANDING STOCK OF ADDITIONAL SUBSIDIARIES
During September 1999 the company acquired all of the outstanding stock of La
Societe De Services, Bergeron Conseils Et Realisations Inc., and Ixiem
Productions Inc. by the issuance of 234,000 shares of its common stock and a
promissary note of $150,000Cn. The subsidiaries are engaged in the business of
conducting electronic commerce on the World Wide Web. The transactions were
recorded as a purchase which resulted in the recognition of Good Will and will
be amortized over a useful life of five years or a shorter period if there is
an impairment of value.
3. RELATED PARTY TRANSACTIONS
Related parties own 71% of the outstanding stock of the Company.
4. GOING CONCERN
The Company will need additional working capital to be successful in its planned
operations.
Continuation of the Company as a going concern is dependent upon obtaining
additional working capital and the management of the Company has developed a
strategy, which it believes will accomplish this objective through long term
financing and additional equity funding which will enable the Company to
continue operations for the coming year.
[LETTERHEAD OF ANDERSEN ANDERSEN & STRONG]
Board of Directors
Engle Mining Co., Inc.
Salt Lake City, Utah
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We have audited the accompanying balance sheets of Engle Mining Co., Inc. (a
development stage company) at December 31, 1998 and the statements of
operations, stockholders' equity, and cash flows for the years ended December
31, 1998 and 1997 the period February 19, 1986 (date of inception) to December
31, 1998. 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 overall balance sheet 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 Engle Mining Co., Inc. at
December 31, 1998 and the results of operations and cash flows for the years
ended December 31, 1998 and 1997 and the period February 19, 1986 (date of
inception) to December 31, 1998, 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 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 4. These financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.
/s/ ANDERSEN ANDERSEN & STRONG
April 10, 1999
Salt Lake City, Utah
<PAGE>
ENGLE MINING CO., INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
DECEMBER 31, 1998
<TABLE>
<CAPTION>
<S> <C>
ASSETS
CURRENT ASSETS
Cash. . . . . . . . . . . . . . . . . . . . . . . . . . $ -
---------
Total Current Assets. . . . . . . . . . . . . . . $ -
=========
LIABILITIES AND STOCKHOLDERS'
EQUITY
CURRENT LIABILITIES
Accounts payable. . . . . . . . . . . . . . . . . . . . $ 1,200
---------
Total Current Liabilities . . . . . . . . . . . . . . . 1,200
---------
STOCKHOLDERS' EQUITY
Common stock
100,000,000 shares authorized, at $0.001 par
value; 2,364,000 shares issued and outstanding. 2,364
Capital in excess of par value. . . . . . . . . . . . . 64,436
Deficit accumulated during the
development stage . . . . . . . . . . . . . . . . . . . (68,000)
---------
Total Stockholders' Equity (Deficiency). . . . . . . . (1,200)
---------
$ -
=========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
ENGLE MINING CO., INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED DECEMBER 31, 1998 AND 1997
AND THE PERIOD FEBRUARY 19, 1986
(DATE OF INCEPTION) TO DECEMBER 31, 1998
<TABLE>
<CAPTION>
FEBRUARY 19, 1986
DEC 31, DEC 31, (DATE OF INCEPTION) TO
1998 1997 DECEMBER 31, 1998
------------- ------------ -------------------
<S> <C> <C> <C>
REVENUES. . . . . . $ - $ - $ -
EXPENSES. . . . . . 10,000 - 68,000
------------- ------------ -------------------
NET LOSS. . . . . . $ (10,000) $ - $ (68,000)
============= ============ -------------------
NET LOSS PER COMMON
SHARE
Basic . . . . . . $ (0.004) $ -
============= ============
AVERAGE OUTSTANDING
SHARES
Basic. . . . . 2,364,000 2,320,000
------------- ------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
ENGLE MINING CO., INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
PERIOD FROM FEBRUARY 19, 1986 (DATE OF INCEPTION)
TO DECEMBER 31, 1998
<TABLE>
<CAPTION>
COMMON STOCK CAPITAL In
------------------- EXCESS OF ACCUMULATED
SHARES AMOUNT PAR VALUE DEFICIT
--------- ------- ---------- ---------
<S> <C> <C> <C> <C>
BALANCE FEBRUARY 19, 1986 (date of inception) - $ - $ - $ -
Issuance of common stock for cash
at $.025 - June 24, 1988 . . . . . . . . . . 720,000 720 17,280 -
Issuance of common stock for cash
at $.025 - August 20, 1988. . . . . . . . . 600,000 600 14,400 -
Issuance of common stock for cash
at $.025 - September 19, 1988 . . . . . . . . 200,000 200 4,800 -
Issuance of common stock for cash
at $.025 - November 30, 1988 . . . . . . 600,000 600 14,400 -
Issuance of common stock for cash
at $.025 - December 16, 1988. . . . . . 200,000 200 4,800 -
Net operating loss for the year ended
December 31, 1988. . . . . . . . . . . . - - - (58,000)
Issuance of common stock for cash
at $.20 - April 25, 1998 . . . . . . . . 44,000 44 8,756 -
Net operating loss for the year
ended December 31, 1998 . . . . . . . . . . . - - - (10,000)
--------- ------- ---------- ---------
BALANCE DECEMBER 31, 1998 . . . . . . . . . . 2,364,000 $ 2,364 $ 64,436 $(68,000)
========= ======= ========== =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
ENGLE MINING CO., INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 1998 AND 1997
AND THE PERIOD FEBRUARY 19, 1986
(DATE OF INCEPTION) TO DECEMBER 31, 1998
<TABLE>
<CAPTION>
FEBRUARY 19, 1986
(DATE OF INCEPTION)
1998 1997 TO DECEMBER 31, 1998
------------- ----------- ----------------------
<S> <C> <C> <C>
CASH FLOWS FROM
OPERATING ACTIVITIES
Net loss . . . . . . . . . . . . . . . $ (10,000) $ - $ (68,000)
Adjustments to reconcile net loss to
net cash provided by operating
activities
Changes in accounts payable . 1,200 - 1,200
Net Cash Used by Operations. . . (8,800) - (66,800)
-------------------- ----------- ----------------------
CASH FLOWS FROM INVESTING
ACTIVITIES . . . . . . . . . . . . . . - - -
-------------------- ----------- ----------------------
CASH FLOWS FROM FINANCING
ACTIVITIES
Proceeds from issuance of common stock
8,800 - 66,800
-------------------- ----------- ----------------------
Net Increase (Decrease) in Cash. . . . - - -
Cash at Beginning of Period. . . . . . - - -
-------------------- ----------- ----------------------
Cash at End of Period. . . . . . . . . $ - $ - $ -
==================== =========== ======================
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
ENGLE MINING CO., INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION
The Company was incorporated under the laws of the state of Nevada on February
19, 1986 with authorized common stock of 10,000,000 shares with par value of
$.0025. On April 15, 1998 the authorized common stock was increased to
100,000,000 shares with a change in par value to $0.001.
On April 15, 1998 the Company completed a reverse common stock split of two
shares of its outstanding stock for one share and on January 8, 1999 a forward
common stock split of one share of outstanding stock for four shares. This
report has been prepared showing after stock split shares with a par value of
$0.001 from its inception.
The company has been in the development stage since inception and has been
primarily engaged in the business of developing mining properties. During 1988
the company abandoned its remaining assets and settled its liabilities and since
that date has remained inactive.
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
- -------------
At December 31, 1998, the Company had a net operating loss carry forward of
$68,000. 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. The loss carryforward will expire beginning in
years 2004 though 2019.
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.
<PAGE>
ENGLE MINING CO., INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
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.
Financial instruments
- ----------------------
The carrying amounts of financial instruments, including the 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.
Earnings (Loss) Per Share
- ----------------------------
Earnings (loss) per share amounts are computed based on the weighted average
number of shares actually outstanding, after the stock splits, in accordance
with FASB statement No 128.
3. RELATED PARTY TRANSACTIONS
Related parties have acquired 91% of the outstanding stock of the Company at
December 31, 1998.
4. GOING CONCERN
The Company intends to acquire interests in various business opportunities
which, in the opinion of management, will provide a profit to the Company
however additional working capital will be needed to be successful in this
effort.
Continuation of the Company as a going concern is dependent upon obtaining
additional working capital and the management of the Company has developed a
strategy, which it believes will accomplish this objective through additional
equity funding which will enable the Company to continue operations into the
coming year.
Management recognizes that there can be no assurance that the Company can be
successful in this effort.
ARTICLES OF INCORPORATION
OF
ENGLE MINING, CO., INC.
KNOWN ALL MENS BY THESE PRESENTS:
That we, the undersigned, have this day voluntarily associated ourselves
together for the purpose of forming a corporation under and by virtue of the
laws of the State of Nevada, an we do hereby state certify:
I
The name of the corporation is: Engle Mining Co., Inc.
II
The Resident Agent of the corporation shall be Yoko Somers and the location of
the principal office of the corporation within the state of Nevada shall be 2121
Pinto Road, Henderson, Nevada 89015. Offices for the transactions of any
business for the corporation, and where the meetings of the Board of Directors
and of the stockholders may be held, may be established and maintained in any
other part of the State of Nevada, or in any other State, territory or
possession of the United States, or in a foreign country, as the Board of
Directors may from time to time determine.
III
The corporation is authorized to engage in any activity permitted by law.
IV
The total authorized capital stock of this corporation shall consist of Ten
Million (10,000,000) shares of common stock of a single class, each share having
a par value of Twenty Five (0.0025) mills. All of the voting power of the
capital stock of this corporation shall reside in the common stock. No capital
stock of this corporation shall be subject to assessment.
<PAGE>
V
The members of the governing board of this corporation shall be styled
directors, and pursuant to NRS 78.115, in cases where all the shares of the
corporation are owned beneficially and of record by either one or two
stockholders, then the number of directors may be less than three but not less
than the number of stockholders. The names and addresses of the persons who are
appointed to act as the first directors of this corporation are as follows:
NAMES ADDRESSES
A.W. Martin 4055 S. Spencer, Suite 222
Las Vegas, Nevada 89119
Yoko Somers 2121 Pinto Road
Henderson, Nevada 89015
VI
This corporation is to have perpetual existence.
VII
The names and addresses of the incorporators of this corporation are as follows:
NAMES ADDRESSES
A.W. Martin 4055 S. Spencer, Suite 222
Las Vegas, Nevada 89119
Yoko Somers 2121 Pinto Road
Henderson, Nevada 89015
VIII
Pursuant to authority granted by NRS 78.265, the shareholders shall have no
pre-emptive rights to acquire unissued shares, treasury shares or securities
convertible into such shares.
IN WITNESS WHEREOF, THE UNDERSIGNED INCORPORATORS HAVE EXECUTED THESE ARTICLES
OF INCORPORATION OF ENGLE MINING CO., INC.
On this 18th day of February, 1986.
/s/ Yoko Somers /s/ A.W. Martin
- ----------------- -----------------
Yoko Somers A.W. Martin
CERTIFICATE OF AMENDMENT
ENGLE MINING CO., INC.
A NEVADA CORPORATION
The undersigned, Philippe Racine, President and Victor Lacroix, Secretary
of Engle Mining Co., Inc. hereby certify:
The shareholders of Engle Mining Co., Inc. through an Action of
Shareholders without a meeting and representing over 51% of the issued and
outstanding stock, amend the Articles of Incorporation as follows:
Article I is hereby amended to read as:
Article I
---------
The name of the Corporation shall be: iVision Group Ltd.
-------------------
Dated this 4th day of February, 1999.
/s/ Philippe Racine
----------------------
Philippe Racine, President
/s/ Victor Lacroix
---------------------
Victor Lacroix, Secretary
On this 4th day of February, 1999, Philippe Racine, President and Victor
Lacroix, Secretary of Engle Mining Co., Inc. appeared before me and executed
the attached Certificate of Amendment for the Corporation.
/s/ Notary Signature
----------------------------------
Notary Public
Corporate Bylaws
----------------
BY LAWS
OF
ENGLE MINING COMPANY
(A CORPORATION)
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C>
ARTICLE I . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
- -------------------------------------------------------------------
OFFICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
- -------------------------------------------------------------------
Section 1: PRINCIPAL OFFICES. . . . . . . . . . . . . . . . . . . . 3
- -------------------------------------------------------------------
Section 2: OTHER OFFICES . . . . . . . . . . . . . . . . . . . . . 3
- -------------------------------------------------------------------
ARTICLE II. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
- -------------------------------------------------------------------
MEETINGS OF SHAREHOLDERS. . . . . . . . . . . . . . . . . . . . . . 3
- -------------------------------------------------------------------
Section 1:ANNUAL MEETING. . . . . . . . . . . . . . . . . . . . . . 3
- -------------------------------------------------------------------
Section 2. PLACE OF MEETINGS . . . . . . . . . . . . . . . . . . . 4
- -------------------------------------------------------------------
Section 3: SHAREHOLDER ACTION WITHOUT MEETING . . . . . . . . . . . 4
- -------------------------------------------------------------------
Section 4:SPECIAL MEETINGS. . . . . . . . . . . . . . . . . . . . . 4
- -------------------------------------------------------------------
Section 5: NOTICE OF MEETINGS . . . . . . . . . . . . . . . . . . . 4
- -------------------------------------------------------------------
Section 6: WAIVER OF NOTICE . . . . . . . . . . . . . . . . . . . . 5
- -------------------------------------------------------------------
Section 7: QUORUM . . . . . . . . . . . . . . . . . . . . . . . . . 5
- -------------------------------------------------------------------
Section 8: PROXIES. . . . . . . . . . . . . . . . . . . . . . . . . 5
- -------------------------------------------------------------------
Section 9: VOTING . . . . . . . . . . . . . . . . . . . . . . . . . 5
- -------------------------------------------------------------------
Section 10: LIST OF SHAREHOLDERS. . . . . . . . . . . . . . . . . . 5
- -------------------------------------------------------------------
Section 11: INSPECTORS. . . . . . . . . . . . . . . . . . . . . . . 6
- -------------------------------------------------------------------
Section 12: ELECTION BY BALLOT. . . . . . . . . . . . . . . . . . . 6
- -------------------------------------------------------------------
Section 13: ORDER OF BUSINESS . . . . . . . . . . . . . . . . . . . 6
- -------------------------------------------------------------------
<PAGE>
ARTICLE III . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
- -------------------------------------------------------------------
BOARD OF DIRECTORS. . . . . . . . . . . . . . . . . . . . . . . . . 7
- -------------------------------------------------------------------
Section 1: GENERAL POWERS . . . . . . . . . . . . . . . . . . . . . 7
- -------------------------------------------------------------------
Section 2: ENUMERATION OF DIRECTOR'S POWER. . . . . . . . . . . . . 7
- -------------------------------------------------------------------
Section 3: NUMBER, TENURE, QUALIFICATION AND ELECTIONS. . . . . . . 8
- -------------------------------------------------------------------
Section 4: VACANCIES. . . . . . . . . . . . . . . . . . . . . . . . 8
- -------------------------------------------------------------------
Section 5: ANNUAL MEETING . . . . . . . . . . . . . . . . . . . . . 8
- -------------------------------------------------------------------
Section 6: NOTICE OF MEETINGS . . . . . . . . . . . . . . . . . . . 9
- -------------------------------------------------------------------
Section 7: PLACE OF MEETINGS AND MEETINGS BY TELEPHONE. . . . . . . 9
- -------------------------------------------------------------------
Section 8: SPECIAL MEETINGS . . . . . . . . . . . . . . . . . . . . 9
- -------------------------------------------------------------------
Section 9: MAJORITY OF QUORUM . . . . . . . . . . . . . . . . . . . 9
- -------------------------------------------------------------------
Section 10: TRANSACTIONS OF BOARD OF DIRECTORS. . . . . . . . . . . 9
- -------------------------------------------------------------------
Section 11: ADJOURNMENT . . . . . . . . . . . . . . . . . . . . . . 9
- -------------------------------------------------------------------
Section 12: CONDUCT OF MEETINGS . . . . . . . . . . . . . . . . . . 10
- -------------------------------------------------------------------
Section 13: ACTION WITHOUT MEETING . . . . . . . . . . . . . . . . 10
- -------------------------------------------------------------------
Section 14: FEES AND COMPENSATION OF DIRECTORS . . . . . . . . . . 10
- -------------------------------------------------------------------
Section 15: APPROVAL OF BONUSES FOR DIRECTORS AND OFFICERS . . . . 10
- -------------------------------------------------------------------
ARTICLE IV. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
- -------------------------------------------------------------------
OFFICERS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
- -------------------------------------------------------------------
Section 1: OFFICERS. . . . . . . . . . . . . . . . . . . . . . . . 10
- -------------------------------------------------------------------
Section 2: ELECTION OF OFFICERS. . . . . . . . . . . . . . . . . . 11
- -------------------------------------------------------------------
Section 3: SUBORDINATE OFFICERS. . . . . . . . . . . . . . . . . . 11
- -------------------------------------------------------------------
Section 4: REMOVAL AND RESIGNATION OF OFFICERS . . . . . . . . . . 11
- -------------------------------------------------------------------
Section 5: VACANCIES IN OFFICES. . . . . . . . . . . . . . . . . . 11
- -------------------------------------------------------------------
Section 6: PRESIDENT . . . . . . . . . . . . . . . . . . . . . . . 11
- -------------------------------------------------------------------
Section 7: VICE PRESIDENT. . . . . . . . . . . . . . . . . . . . . 12
- -------------------------------------------------------------------
Section 8: SECRETARY . . . . . . . . . . . . . . . . . . . . . . . 12
- -------------------------------------------------------------------
Section 9: CHIEF FINANCIAL OFFICER . . . . . . . . . . . . . . . . 12
- -------------------------------------------------------------------
ARTICLE V . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
- -------------------------------------------------------------------
INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES, AND OTHER AGENTS 13
- -------------------------------------------------------------------
Section 1: AGENTS, PROCEEDINGS, AND EXPENSES . . . . . . . . . . . 13
- -------------------------------------------------------------------
</TABLE>
<PAGE>
ARTICLE I
----------
OFFICES
SECTION 1: PRINCIPAL OFFICES
--------------------------------
The principal office for the transaction of the business of the Corporation
is fixed and located at resident of the President. The Board of Directors may,
from time to time, change the Principal Office from one location to another as
may be necessary.
The Secretary shall note any change of the location of the Principal Office on
these By-Laws contiguous this section, or this section may be amended to
identify the new location.
SECTION 2: OTHER OFFICES
----------------------------
The Board of Directors may, at any time, establish branch or subordinate
offices at any place or places.
ARTICLE II
-----------
MEETINGS OF SHAREHOLDERS
SECTION 1:ANNUAL MEETING
---------------------------
The annual meeting of shareholders shall be held on the last 1st day
January of each year at 11:30 am or at such other date and time that shall be
scheduled by the Board of Directors to the extent that such scheduling is in
compliance with the laws of the State of .
At this meeting, Directors shall be elected, and any other proper business
within the power of the shareholders may be transacted. In the event that an
annual meeting is not held in any year, the Board of Directors, as then
constituted, shall continue to perform their duties until such annual or special
meeting is properly called and they, or any of them, are re-elected or
replaced.
<PAGE>
SECTION 2. PLACE OF MEETINGS
---------------------------------
All annual shareholders meetings shall be held at the Corporation's
Principal Office, or at an alternate location selected by the Board of Directors
upon notification to the shareholders as required by Section 4 of these
Articles.
All other shareholders meetings shall be held either at the Principal Office or
any other place within or outside the State of that may be designated either by
the Board of Directors in accordance with these Bylaws, or by the written
consent of all persons entitled to vote at the meeting, given either before or
after the meeting and filed with the Secretary of the Corporation.
SECTION 3: SHAREHOLDER ACTION WITHOUT MEETING
Pursuant to law, any action which could be taken at a meeting of the
shareholders may be taken without a meeting if a written consent thereto is
signed by shareholders holding at least a majority of the voting power of the
Corporation, except that if a different proportion of voting power is required
for such action at a meeting, then that proportion of written consent shall be
required.
SECTION 4:SPECIAL MEETINGS
-----------------------------
A special shareholders meeting, for any purpose whatsoever, may be called
at any time by the President, any Vice-President, the Board of Directors, or one
or more shareholders holding not less than one-tenth (1/10) of the voting power
of the Corporation.
SECTION 5: NOTICE OF MEETINGS
----------------------------------
Written notices specifying the place, day, and hour of the meeting and, in
the case of a special meeting, the general nature of the business to be
transacted, shall be given not less than ten (10) days, nor more than fifty (50)
days before the date of the meeting.
Such notice must be given personally or by mail or by other means of written
communication, addressed to the shareholder at the address appearing on the
books of the corporation, or given by the shareholder to the Corporation for the
purpose of notice.
If no such address appears or is given by a shareholder of record entitled to
vote at the meeting, notice is given in the at the place where the Principal
Executive Office of the Corporation is located, or by publication at least once
in a newspaper of general circulation in the county where the Principal
Executive Office is located.
<PAGE>
SECTION 6: WAIVER OF NOTICE
- -------------------------------
A shareholder may waive notice of any annual or special meeting by signing
a written notice of waiver either before or after the date of such meeting.
SECTION 7: QUORUM
- -------------------
The presence in person or by proxy of the holders of at least fifty-one
percent (51%) of the outstanding shares entitled to vote at any meeting of the
shareholders shall constitute a quorum fro the transaction of business.
The shareholders present at a duly called or held meeting at which a quorum
is present may continue to do business until adjournment notwithstanding the
withdrawal of enough shareholders to leave less than a quorum, any action taken
(other than adjournment) is approved by at least a majority of the shares
required to constitute a quorum.
SECTION 8: PROXIES
- --------------------
Every person entitled to vote at a shareholders' meeting of the
Corporation, or entitled to execute written consent authorizing action in lieu
of a meeting, may do so either in person or by proxy executed in writing by the
shareholder or by his or her duly authorized attorney-in-fact. No proxy shall be
valid after eleven (11) months from the date of its execution unless otherwise
provided in the proxy.
SECTION 9: VOTING
- -------------------
Except as otherwise provided in the Articles of Incorporation, or by
agreement, or by the general Corporation law, shareholders at the close of
business on the record date are entitled to notice an to vote.
SECTION 10: LIST OF SHAREHOLDERS
- ------------------------------------
The Secretary shall prepare, at least ten (10) days before every meeting of
shareholders, a complete list of the shareholders entitled to vote at the
meeting, arranged in alphabetical order, showing the address of each
shareholder, for any purpose germane to the meeting. This list shall be
produced and kept at the time and place of the meeting during the whole time
thereof and may be inspected by any shareholder present.
<PAGE>
- ------
SECTION 11: INSPECTORS
- ------------------------
At each meeting of shareholders, the Chairperson of the meeting may appoint
one or more Inspectors of Voting whose duty it shall be to receive and count the
ballots and make a written report showing the results of the balloting. The
Secretary of the Corporation may perform this function.
SECTION 12: ELECTION BY BALLOT
- ----------------------------------
Election for Directors need not be by ballot unless a shareholder demands
election by ballot at the meeting and before the voting begins. The candidates
receiving the highest number of votes, up to the number of directors to be
elected, shall be elected. No cumulative voting shall be allowed.
SECTION 13: ORDER OF BUSINESS
- ---------------------------------
The order of business at the annual meeting of the shareholders, insofar as
possible, and at all other meetings of shareholders, shall be as follows:
1. Call to Order
2. Proof of Notice of Meeting
3. Reading and disposing of any unapproved minutes
4. Reports of Officers
5. Reports of Committees
6. Election of Directors
7. Disposition of unfinished business
8. Disposition of new business
9. Adjournment
<PAGE>
------
ARTICLE III
-----------
BOARD OF DIRECTORS
SECTION 1: GENERAL POWERS
- ----------------------------
Subject to the provisions of the Corporation Act, and any limitations in
the Articles of Incorporation, and any limitations in the Articles of
Incorporation and these Bylaws relating to actions required to be approved by
the shareholders or by the outstanding shares, the business and affairs of the
Corporation shall be managed and all corporate powers shall be exercised by or
under the direction of the Board of Directors.
SECTION 2: ENUMERATION OF DIRECTOR'S POWER
- -----------------------------------------------
Without prejudice to these general rules, and subject to the same
limitation, the Board of Directors shall have the power to:
1. Select and remove all officers, agents and employees of the Corporation;
prescribe any powers and duties for them that are consistent with law, withy
the Articles of Incorporation, and these Bylaws; fix their compensation; and
require from them security for faithful service.
2. Change the principal Executive Office or the Principal Business Office
from one location to another; cause the Corporation to be qualified to do
business in any other state, territory, dependency, or country and conduct
business within or outside the State of ; and designate any place within or
outside the State of for the holding of any shareholders meeting or meetings,
including Annual Meetings.
3. Adopt, make, or use a Corporate Seal; prescribe the forms of Certificates
of Stock; and alter the form of the Seal and Certificate.
4. Authorize the issuance of shares of stock of the Corporation on any
lawful terms, in consideration of moneys paid, labor done, services actually
rendered, debts or securities cancelled, or tangible or intangible property
actually received.
5. Engage in and/or adopt employment agreements, contracts, or other
employment contracts with independent contractors, companies, government
agencies, or individuals.
<PAGE>
------
SECTION 3: NUMBER, TENURE, QUALIFICATION AND ELECTIONS
------------------------------------------------------
To the extent allowed by the Articles of Incorporation, the Board of
Directors shall be fixed from time to time by resolution of the Board, but shall
not be less than three (3), nor shall it exceed five (5). Directors need not be
shareholders of the Corporation.
The number of Directors may be increased beyond five (5) only by approval
of the outstanding shares of the Corporation.
The Directors of the Corporation shall be elected at the Annual Meeting of the
shareholders and shall serve until the next annual or special meeting is
properly called and they, or any of them, are re-elected and until their
successors have been elected and qualified.
SECTION 4: VACANCIES
- ----------------------
A vacancy, or vacancies, on the Board of Directors shall be deemed to exist
in the event of the death, resignation, or removal of any Director, or if the
Board of Directors, by resolution, declares vacant that office of a Director who
has been declared of unsound mind by an order of court, or convicted of a
felony, or if the authorized number of Directors is increased, the shareholders
fail at any meeting of shareholders at which the Director or Directors are
elected, to elect the number of Directors to be voted for at that meeting.
Any Director may resign effective immediately upon giving written notice to
the Chairperson of the Board, the President, the Secretary, or the Board of
Directors, unless a notice specifies a later time for the resignation to become
effective. If the resignation of a Director is effective at a future time, the
Board of Directors may elect a successor to take office when the resignation
becomes effective.
Vacancies on the Board of Directors may be filled by a majority of the
remaining Directors, whether or not less than a quorum, or by a sole remaining
Director, except that a vacancy created by the removal of a Director by the vote
or written consent of the shareholders or by court order may be filled only by
the vote or written consent of the shareholders or by court order may be filled
only by the vote of a majority of the shares entitled to vote represented at a
duly held meeting at which a quorum is present, or by the unanimous written
consent of the shareholders of the outstanding shares entitles to vote.
The shareholders may elect a Director or Directors at any time to fill any
vacancy or vacancies not filled by the Directors, but any such election by
written consent shall require the consent of a majority of the outstanding
shares entitled to vote, except that filling a vacancy created by a removal of a
Director shall require the written consent of the holders of all outstanding
shares entitled to vote.
Each Director so elected shall hold office until the next annual meeting of
the shareholders and until a successor has been elected and qualified.
SECTION 5: ANNUAL MEETING
- ----------------------------
Immediately following each annual meeting of shareholders, the Board of
Directors may hold a regular meeting at the place that the annual meeting of
shareholders was held or at any other place that shall have been designated by
the Board of Directors for the purpose of organization, any desired election of
officers, and the transaction of other business. Notice of these regular
meetings shall not be required.
SECTION 6: NOTICE OF MEETINGS
- ---------------------------------
Notice need not be given of regular meetings of the Board of Directors, nor
is it necessary to give notice of adjourned meetings. Notice of special
meetings shall be in writing by mail at least four (4) days prior to the date of
the meeting or forty-eight (48) hours' notice delivered personally.
SECTION 7: PLACE OF MEETINGS AND MEETINGS BY TELEPHONE
- --------------------------------------------------------------
Regular and special meetings of the Board of Directors may be held at any
place within or outside the State of that has been designated from time to time
by the Board. In the absence of such designation, meetings shall be held at the
principal executive office of the Corporation. Any meeting, regular or special,
may be held by conference in the meeting can hear one another, and all such
Directors shall be present in person at the meeting.
SECTION 8: SPECIAL MEETINGS
- ------------------------------
The Chairman of the Board or the President, any Vice President, or the
Secretary may call special meetings of the Board of Directors, for any purpose
or purposes, at any time.
SECTION 9: MAJORITY OF QUORUM
- ---------------------------------
A majority of the authorized number of Directors constitutes a quorum of
the Board for the transaction of business except as hereinafter provided.
SECTION 10: TRANSACTIONS OF BOARD OF DIRECTORS
- ----------------------------------------------------
Except as otherwise provided in the Articles or these Bylaws, or by law,
every act or decision done or made by a majority of the Directors present at a
duly held meeting at which a quorum is present, is the act of the Board,
provided, however, that any meeting at which a quorum was initially present may
continue to transact business notwithstanding the withdrawal of Directors if any
action taken is approved by a least a majority of the required quorum for such
meeting.
SECTION 11: ADJOURNMENT
- -------------------------
A majority of Directors present at any meeting, whether or not a quorum is
present, may adjourn the meeting to another time and place. If the meeting is
adjourned for more that twenty-four (24) hours, notice of the adjournment to
another time and place must be given prior to the time of the adjourned meeting
to the Directors who were present at the time of the adjournment.
SECTION 12: CONDUCT OF MEETINGS
- -----------------------------------
The Chairman of the Board, or if there is no such officer, the President,
or in his or her absence, any Director selected by the Director present, shall
preside at the meeting of the Board of Directors. The Secretary of the
Corporation, or in the Secretary's absence any person appointed by the Presiding
Officer, shall act as Secretary of the Board.
SECTION 13: ACTION WITHOUT MEETING
- --------------------------------------
Any action required or permitted to be taken by the Board of Directors may
be taken without a meeting if all members of the Board shall individually or
collectively consent, in writing, to such action. Such action by unanimous vote
of the Board of Directors. Such written consent (s) shall be filed with the
minutes of the proceedings of the Board.
SECTION 14: FEES AND COMPENSATION OF DIRECTORS
- ----------------------------------------------------
Directors and members of committees may receive such compensation, if any,
for their services, and such reimbursement of expenses, as may be fixed or
determined by resolution of the Board of Directors. Nothing herein contained
shall be construed to preclude any Director from serving the corporation in any
other capacity as an officer, agent, employee, or otherwise, and receiving
compensation for such services.
SECTION 15: APPROVAL OF BONUSES FOR DIRECTORS AND OFFICERS
- ------------------------------------------------------------------
No bonuses of share in the earnings or profits of the Corporation shall be
paid to any of the officers, Directors, or employees of the Corporation except
as approved by the Board of Directors.
ARTICLE IV
----------
OFFICERS
SECTION 1: OFFICERS
- ---------------------
The officers of the Corporation shall be a President, a Vice-President, a
Secretary, and a Chief Financial Officer (Treasurer). The Corporation may also
have, at the discretion of the Board of Directors, a Chairman of the Board, one
or more Assistant Secretaries, one or more Assistant Treasurers, and such other
officers as may be appointed in accordance with the provisions of Section 3 of
this Article IV. The same person, except the offices of President and
Secretary, may hold any number of offices.
SECTION 2: ELECTION OF OFFICERS
- -----------------------------------
The officers of the Corporation, except such officers as may be appointed
in accordance with the provisions of Section 3 or Section 5 of this Article IV
shall be chosen by the Board of Directors, and each shall serve at the pleasure
of the Board, subject to the rights, if any, of an officer under any contract of
employment.
SECTION 3: SUBORDINATE OFFICERS
- -----------------------------------
The Board of Directors may appoint, and may empower the President to
appoint, such other officers as the business of the corporation may require.
Each of them shall hold office for such period, have such authority and perform
such duties as are provided in the Bylaws, or as the Board of Directors may from
time to time determine.
SECTION 4: REMOVAL AND RESIGNATION OF OFFICERS
- -----------------------------------------------------
Subject to the rights, if any, of an officer under a contract of
employment, any officer may be removed, either with or without cause, by the
Board of Directors, at any regular or special meeting of the Board, or, except
in case of an officer chosen by the Board of Directors.
Any officer may resign at any time by giving written notice to the
Corporation. Any resignation shall take effect on the date of receipt of that
notice, or at any later time specified in that notice, unless otherwise
specified in that notice. Any resignation is without prejudice to the rights,
if any, of the corporation under any contract for which the officer is a party.
SECTION 5: VACANCIES IN OFFICES
- --------------------------------------
A vacancy in any office because of death, resignation, removal,
disqualification, or any other cause, shall be filled in the manner prescribed
in these Bylaws for regular appointments to that office.
SECTION 6: PRESIDENT
- -------------------------
Subject to such powers, if any, as may be given by the Bylaws or Board of
Directors to other officers of the Corporation, the President shall be the
General Manager and Chief Executive Officer of the Corporation and shall,
subject to the control of the Board of Directors, have general supervision,
direction, and control of the business and the officers of the Corporation. He
shall have the general powers and duties of management usually vested in the
officer of President of a corporation, and shall have such other powers and
duties as may be prescribed by the Board of Directors or the Bylaws.
SECTION 7: VICE PRESIDENT
- -----------------------------
In the absence or disability of the President, the Vice-President
designated by the Board of Directors shall perform all the duties of the
President, and when so acting shall have all the powers of and be subject to all
of the restrictions upon, the President. The sole duty of the Vice-President of
this Corporation shall be to function as a representative of the President in
such case as the President may be absent or disabled. The Vice-President may,
when not acting in the representative capacity of the President, hold other
positions and be assigned other duties within the Corporation.
SECTION 8: SECRETARY
- -----------------------
The Secretary shall keep or cause to be kept, at the principal executive
office or such other place as the Board of Directors may direct, a book of
minutes of all meetings and actions of Directors, committees of Directors and
shareholders, with the time and place of holding, whether regular or special,
and, if special, how authorized, the notice given, the names of those present at
Director meetings or committee meetings, the number of shares present or
represented at shareholders meetings, and the proceedings.
The Secretary shall keep, or cause to be kept, at the principal executive
office or at the officer of the Corporation shall give, or cause to be given,
notice of all meetings of the shareholders, of the Board of Directors, and of
committees of the Board of Directors required by the Bylaws or by law to be
given.
The Secretary shall keep the seal of the Corporation, if one is adopted, in safe
custody and shall have such other powers and perform such other duties as may be
prescribed by the Board of Directors or by the Bylaws.
SECTION 9: CHIEF FINANCIAL OFFICER
- ---------------------------------------
The Chief Financial Officer (Treasurer) shall keep and maintain, or cause
to be kept and maintained, adequate and correct books and records of accounts of
the properties and business transactions of the Corporation, including accounts
of its assets, liabilities, receipts, disbursements, gains, losses, capital,
retained earnings, and shares. The book of accounts shall at all reasonable
times be opened to inspection by any Director.
The Chief Financial Officer shall deposit all monies and other valuables in
the name and to the credit of the Corporation with such depositories as may be
designated by the Board of Directors. He shall disburse the funds of the
corporation as may be ordered by the Board of Directors, shall render to the
President and Directors, whenever they request it, an account of all of his
transactions as Chief Financial Officer and of the financial condition of the
Corporation, and shall have other powers and perform other such duties as may be
prescribed by the Board of Directors or the Bylaws.
ARTICLE V
----------
INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES, AND OTHER AGENTS
SECTION 1: AGENTS, PROCEEDINGS, AND EXPENSES
- ----------------------------------------------------
For the purpose of this Article, "agent" means any person who is, or was,
a Director, Officer, employee, or other agent of this Corporation, or is, or
was, serving at the request of this Corporation as a Director, officer,
employee, or agent of another foreign or domestic corporation, partnership,
joint venture, trust or other enterprise, or was a Director, officer, employee,
or agent of a foreign or domestic corporation which was a predecessor
corporation of this corporation or of another enterprise at the request of such
predecessor corporation; "proceeding" means any threatened, pending or completed
action or proceeding, whether civil, criminal, administrative, or investigative;
and "expenses" includes, without imitation, attorney's fees and any expenses of
establishing a right to indemnification under Section 4 or Section 5 of this
Article.
SECTION 2: ACTIONS OTHER THAN BY THE CORPORATION
- --------------------------------------------------------
This Corporation shall defend and indemnify any person who was or is a
party, or is threatened to be made a party, to any proceeding (other than an
action by or in the right of this Corporation) by reason of the fact that such
person is or a was an agent of this Corporation, against expenses, judgments,
fines, settlements and other amounts actually and reasonably incurred in
connection with such proceeding if that person acted in good faith and in a
manner that that person reasonably believed to be in the best interests if this
corporation and, in the case of a criminal proceeding, had no reasonable cause
to believe the conduct of that person was unlawful. The termination of any
proceeding by judgment, order, settlement, conviction, or upon a pleas of nolo
contendere or its equivalent shall not, of itself, create a presumption that the
person did not act in good faith and in a manner which the person reasonably
believed to be in the best interest of this Corporation or that the person had
reasonable cause to believe that the person's conduct was lawful.
SECTION 3: ACTIONS BY THE CORPORATION
- ---------------------------------------------
This Corporation shall indemnify any person who was or is a party, or is
threatened to be made a party, to any threatened, pending or completed action by
or in the right of this Corporation to procure a judgment in its favor by reason
of the fact that said person is or was an agent, counsel to the Corporation,
against expenses actually and reasonably incurred by that person in connection
with the defense or settlement of that action if that person acted in good
faith, in a manner that that person believed to be in the best interests of this
Corporation and with such care, including reasonably inquiry, that such action
would not be deemed grossly negligent on the part of such agent ( for the
purposes of this Article V, the term "agent" shall mean and include all
officers, directors, counsel, and employees). Indemnification shall be
available under this Section 3, conditioned only upon the following:
(a) In respect of any claim, issue or matter as to which that person may be
liable to this Corporation, the duty and obligation of the Corporation to defend
and indemnify such agent shall be absolute unless and only to the extent that
the court in which that action was brought shall determine, upon application,
that in view of all the circumstances of the case, said person acted with
reckless disregard equated to gross negligence with regard to the specific
claims made against said person;
(b) The indemnification provisions set-forth herein are to be interpreted as
broadly as possible in their application to any officer, director, counsel or
agent of the corporation, to include accountants and counsel for the
corporation. Such interpretation shall treat these provisions as continuing
contractual obligations of the corporation and subsequent modification shall not
limit the effect of these provisions as applied to the covered classes who were
so covered, at any time following adoption hereof.
SECTION 4: SUCCESSFUL DEFENSE BY AGENT
- -------------------------------------------
To the extent that an agent of this corporation has been successful on the
merits or otherwise in defense of any proceeding referred to in Section 2 or 3
of this Article, or in defense of any claim, issue, or matter therein, the agent
shall be indemnified against expenses actually and reasonably incurred by the
agent in connection therewith. An agent shall be deemed successful if the Court
fails to make a specific finding regarding the degree of fault as set forth in
Section 3, hereinabove.
SECTION 5: REQUIRED APPROVAL
- -------------------------------
Except as provided in Section 4 of this Article, any indemnification under
this Article shall be made by this Corporation only if authorized in the
specific case on a determination that indemnification of the agent is proper in
the circumstances because the agent is proper in the circumstances because the
agent has met the applicable standard of conduct set forth in Section 2 or 3 of
this Article, by:
(a) A majority vote of a quorum consisting of Directors who are not parties
to the proceeding;
(b) Approval by the affirmative vote of a majority of the shares of this
corporation entitled to vote represented at a duly held meeting at which a
quorum is present or by written consent of holders of a majority of the
outstanding shares entitled to vote; or
(c) The court in which the proceeding is or was pending, on application made
by this corporation or the agent or the attorney or other person rendering
services in connection with the defense, whether or not such application by the
agent, attorney or other person is opposed by this Corporation.
SECTION 6: ADVANCE OF EXPENSES
- ----------------------------------
Expenses incurred in defending any proceeding may be advanced by this
Corporation before the final disposition of the proceeding on receipt of an
understanding by or on behalf of the agent to repay the amount of the advance
unless it shall be determined ultimately that the agent is entitled to be
indemnified as authorized in this Article.
SECTION 7: OTHER CONTRACTUAL RIGHTS
- ---------------------------------------
Nothing contained in this Article shall affect any right to indemnification
to which persons other than Directors and officers of this Corporation or any
subsidiary hereof may be entitled to contract or otherwise.
SECTION 8: INSURANCE
- ----------------------
Upon and in the event of a determination by the Board of Directors of this
Corporation to purchase such insurance, this Corporation shall purchase and
maintain insurance on behalf of any agent of the corporation against any
liability asserted against or incurred by the agent in such capacity or arising
out of the agent's status as such whether or not this corporation would have the
power to indemnify the agent against that liability under the provisions of this
section.
SECTION 9: FIDUCIARIES OF CORPORATE EMPLOYEE BENEFIT PLAN
- ----------------------------------------------------------------
This Article does not apply to any proceeding against any trustee,
investment manager, or other fiduciary of any employee benefit plan in that
person's capacity as such, even though that person may also be an agent of the
Corporation as defined in Section 2 of this Article. Nothing contained in this
Article shall limit any right to indemnification to which such trustee,
investment manager, or other fiduciary may be entitled by contract or otherwise,
which shall be enforceable to the extent permitted by applicable law other than
this Article.
ARTICLE VI
----------
STOCK CERTIFICATES
SECTION 1: FORM
- -----------------
The shares of the Corporation shall be represented by certificates signed
by the President or Vice President, and the Chief Financial Officer or the
Secretary of the Corporation. Any or all of such signatures may be facsimiles
if countersigned by a transfer agent, or registered by a registrar, other than
the Corporation itself or an employee of the Corporation. Each such certificate
shall also state:
(a) The name of the record holder of the shares represented by such
certificate;
(b) The number of shares represented thereby;
(c) A designation of any class or series of which such shares are a part;
(d) That the shares have a par value of $0.001;
(e) That the corporation is organized under the laws of the State of Nevada.
(f) Any restrictions applicable to the shares shall be so designated on the
face thereof.
SECTION 2:TRANSFERS
- --------------------
Transfer of shares of the Corporation shall be made in the manner set forth
in the Nevada Uniform Commercial Code. The Corporation shall maintain stock
transfer books, and any transfers shall be registered thereon only on request
and surrender of the stock certificate representing the transferred shares, duly
endorsed; if transfer is by Power of Attorney, the Power of attorney shall be
deposited with the Secretary of the Corporation or with the designated Transfer
Agency.
SECTION 3: LOST, DESTROYED, AND STOLEN CERTIFICATES
- ---------------------------------------------------------
No certificate or shares of stock in the Corporation shall be issued in
place of any certificate alleged to have been lost, destroyed, stolen, or
mutilated except on production of such evidence and provision of such indemnity
to the Corporation as the Board of Directors may prescribe.
ARTICLE VII
-----------
CORPORATE ACTIONS
SECTION 1: CONTRACTS
- ----------------------
The Board of Directors may authorize any officer or officers, or any agent
or agents of the Corporation, to enter into any contract or to execute and
deliver any instrument in the name of and on behalf of the Corporation, and such
authority may be general or confined to specific instances.
SECTION 2: LOAN
- -----------------
No loan shall be made by the Corporation to its officers or Directors, and
no loan shall be made by the Corporation secured by its shares. No loan shall
be made or contracted on behalf of the Corporation and no evidences of
indebtedness shall be issued in its name unless authorized by resolution of the
Board of Directors. Such authority may be general or confined to specific
instances.
SECTION 3: CHECKS, DRAFTS, OR ORDERS
- -----------------------------------------
All checks, drafts, or other orders for the payment of money by or to the
Corporation and all notes and other evidence of indebtedness issued in the name
of the Corporation shall be signed by such officer or officers, agent or agents
of the Corporation, and in such manner as shall be determined by resolution of
the Board of Directors.
SECTION 4: BANK DEPOSITS
- ---------------------------
All funds of the Corporation and otherwise employed, shall be deposited to
the credit of the Corporation in such banks, trust companies, or other
depositories as the Board of Directors may select.
ARTICLE III
-----------
MISCELLANEOUS
SECTION 1: INSPECTION OF CORPORATE RECORDS
- -----------------------------------------------
The stock ledger and minute books may be kept by any information storage
device if readily convertible into legible form. Any shareholder of record, in
person or by an attorney or agent who presents proof of such position with
guaranteed signature on such proof, may, upon written demand under oath, stating
purpose, inspect for any proper purpose, the stock ledger, list of shareholders
and make written extracts of the same. Such extracts shall be made in writing
by the individual preparing or requesting such inspection and such inspection
shall be during normal business hours and shall not be made without at least
five (5) business days written notice thereof. Such notice, to be effective
must be received not at least five (5) business days prior to the proposed
inspection date, a signed receipt from the US Postal Service shall be proof of
such notice and the date of receipt.
SECTION 2: INSPECTION OF ARTICLES OF INCORPORATION AND BYLAWS
- ---------------------------------------------------------------------
The original or a copy of the Articles of Incorporation and Bylaws of the
Corporation, as amended or otherwise altered to date, and certified by the
Secretary of the Corporation, shall at all times be kept at the principal
executive office of the Corporation. Such Articles and Bylaws shall be open for
inspection to all shareholders of record or holders of voting trust certificates
at all reasonable times during the business hours of the Corporation.
SECTION 3: FISCAL YEAR
- -------------------------
The fiscal year of the Corporation shall begin on the first day of January
of each year and end at midnight on the last day of December of the same year or
as otherwise determined by the Board of Directors.
SECTION 4:CONSTRUCTION AND DEFINITION
- ----------------------------------------
Unless the context requires otherwise, the general provisions, rules of
construction, and definitions contained in the applicable Nevada Status which
shall govern the construction of these Bylaws.
Without limiting the foregoing, the masculine gender where used included
the feminine and neuter, the singular number includes the plural, and the plura
number includes the singular, "shall" is mandatory and "may" is permissive; and
"person" includes the Corporation as well as a natural person.
ARTICLE IX
----------
AMENDMENTS TO BYLAWS
These Bylaws may be amended at any time by a majority vote of the Board of
Directors or by a majority vote of the outstanding shares held by the
shareholders of the corporation.
CERTIFICATE OF SECRETARY OF ADOPTION BY DIRECTORS
I HEREBY CERTIFY that I am the duly elected, qualified and acting Secretary
of the above-named Corporation and that the above and foregoing Bylaws were
adopted as the Bylaws of said Corporation on the date set forth above by a
majority of vote of the shareholders of said Corporation.
Date: March 12, 1998
/S/
Lynn Noerring
Secretary
SHARE PURCHASE AGREEMENT
MADE AND ENTERED INTO ON THE 15TH DAY OF SEPTEMBER 1999.
BETWEEN:
IVISION GROUP LTD., a corporation duly incorporated under the laws
of Nevada, U.S.A., and having its head office at 3230 East Flamingo Road, Suite
156, Las Vegas, Nevada, U.S.A. 89121, acting and represented hereby by
Andre Dorais, duly authorized as he so declares,
(hereinafter referred to as the "Purchaser");
AND:
FRANCOIS CHARRON, a businessman, domiciled and residing at 1270,
Marconi street, Drummondville, Quebec, J2B 8E9;
(hereinafter referred to as "Charron")
AND:
SCHLAGALACK INC., a company duly incorporated under the laws of Quebec
and having its head office at 2552, rue Ste-Catherine East, Montreal, Quebec,
H2K 2K3, acting and represented hereby by Fran ois Charron, its president, duly
authorized as he so declares;
(hereinafter referred to as "Schlagalack")
(collectively referred to as the "Vendor" on a joint and several basis
hereinafter);
AND:
IXIEM! PRODUCTIONS INC., a corporation duly incorporated under the Laws
of Canada and having its head office at 2550, Ste-Catherine East, Montreal,
Quebec, H2K 2K3, acting and represented hereby by Fran ois Charron, its
President, duly authorized as he so declares;
(hereinafter referred to as "Ixiem" or the "Acquired Corporation");
WHEREAS the Purchaser is a publicly traded company listed on the OTC
Bulletin Board, involved in web commerce interactive marketing and related
matters;
WHEREAS Ixiem, a company duly incorporated under the laws of Quebec, having
its head office and principal place of business at 2550, Saint-Catherine East,
Montreal, Quebec, H2K 2K3 (hereinafter referred to as "Ixiem"), is a web project
management consulting corporation;
WHEREAS all the issued and outstanding shares in the share capital of Ixiem are
owned under the Laws of Quebec, by the Vendor; and
WHEREAS the Purchaser wishes to purchase and the Vendor wishes to sell to
the Purchaser all of the issued and outstanding shares in the share capital of
Ixiem.
NOW THEREFORE, THIS AGREEMENT WITNESSETH that in consideration of the
mutual covenants hereinafter provided, the parties agree as follows:
ARTICLE 1
DEFINITIONS AND PRINCIPLES OF INTERPRETATION
--------------------------------------------
1.1 DEFINITIONS - Whenever used in this Agreement, unless there is something
-----------
inconsistent in the subject matter or context, the following words and terms
shall have the meanings set out below:
1.1.1 ACCOUNTS RECEIVABLE means any and all accounts receivable, bills
receivable and book debts of the Acquired Corporation as the case may be, prior
to the Closing Date;
1.1.2 ACCRUED LIABILITIES means any and all accrued liabilities of the
Acquired Corporation incurred in the ordinary course of business, including
accruals for vacation pay, customer rebates and allowances for product returns;
1.1.3 ACQUIRED CORPORATION means Ixiem;
1.1.4 AGREEMENT means this Share Purchase Agreement, including all
schedules, and all instruments supplementing or amending or confirming this
Agreement and references to Article or Section mean and refer to the
specified Article or Section of this Agreement;
1.1.5 ARM'S LENGTH means arm's length as defined in the Income Tax Act
(Canada);
1.1.6 BALANCE SHEETS means the balance sheet of Ixiem as at May 31st, 1999
copy of which are attached is Schedule 1.1.16;
1.1.7 BOOKS AND RECORDS means all books and records of the Acquired
Corporation, including financial, corporate, operation and sales books, records,
books of account, sales and purchase records, lists of suppliers and customers,
business reports, plans and projections and all other documents, files, records,
correspondence, and other data and information, financial or otherwise,
including without limitation, all data and information stored on
computer-related media;
1.1.8 CLAIMS means any claim, demand, action, cause of action, damage,
loss, costs, liability or expense, including, without limitation, reasonable
professional fees and all costs incurred in pursuing any of the foregoing;
1.1.9 CLOSING means the completion of the sale to and purchase by the
Purchaser of the Purchased Shares under this Agreement and all ancillary
transactions contemplated hereof;
1.1.10 CLOSING DATE means the 15th day of September 1999, or such other
date as the parties may agree in writing as the date upon which the Closing
shall take place;
1.1.11 CLOSING TIME means 5:30 P.M., Montreal time, on the Closing Date or
such other time on such date as the parties may agree in writing as the time at
which the Closing shall take place;
1.1.12 CONTRACTS means all contracts, licences, leases, agreements,
commitments, entitlements and engagements of the Acquired Corporation whether
written or oral and includes all quotations, orders or tenders for contracts
which remain open for acceptance and any supplier's warranty, guarantee or
commitment (express or implied);
1.1.13 ENCUMBRANCE means any pledge, lien, charge, hypothec, security
agreement, lease, title retention agreement, mortgage, encumbrance or option;
1.1.14 EQUIPMENT CONTRACTS means all leases, equipment leases, conditional
sales contracts, leasings, installment sales, title retention agreements and
other similar agreements relating to equipment;
1.1.15 EXCHANGED SHARES means collectively all shares of Common Stock in
the share capital of the Purchaser issued to the Vendor pursuant to section 3 of
this Agreement;
1.1.16 FINANCIAL STATEMENTS means the unaudited financial statements for
the fiscal year ended December 31st 1998, copy of which is attached as Schedule
1.1.16;
1.1.17 GOVERNMENTAL AUTHORITY means any government, regulatory authority,
governmental department, agency, commission, board, tribunal, crown corporation,
or court or other law, rule or regulation-making entity having or purporting to
have jurisdiction on each of the Acquired Corporation, as the case may be;
1.1.18 GOVERNMENTAL AUTHORIZATION means all authorizations, approvals,
licences or permits issued, granted, given, or otherwise made available by or
under the authority of any Governmental Authority as required pursuant to Laws;
1.1.19 INDEBTEDNESS means the indebtedness of the Acquired Corporation for
borrowed money including principal and accrued interest and the cost of
repayment of any indebtedness of the Acquired Corporation for borrowed money;
1.1.20 INTELLECTUAL PROPERTY means all copyrights, trademarks, trade
names, proprietary informations, trade secrets and all other intellectual
property owned by, licensed to or used by the Acquired Corporation (including
applications and registrations for any of the foregoing and renewals, divisions,
extensions and reissues, where applicable, pertaining thereto) as described in
Schedule 1.1.20;
1.1.21 INVENTORIES means all inventories of every kind and nature and
wheresoever situate, owned by the Acquired Corporation including, without
limitation, all work-in-progress;
1.1.22 LAWS means all applicable laws, by-laws, rules, regulations,
orders, ordinances and judgements or other requirements of any Governmental
Authority;
1.1.23 LOSSES means any damage, liability, loss, cost, expense (including
all reasonable attorney's), deficiency, interest, penalty, impositions,
assessments or fines;
1.1.24 MATERIAL CONTRACTS means (a) the Equipment Contracts, Real Property
Leases; (b) any other Contract involving aggregate annual payments to or by any
Acquired Corporation in excess of $1,000.00; (c) any commitment to or by the
Acquired Corporation that may reasonably extend beyond three (3) months from the
Closing Date; and (d) any Contract which is outside the ordinary course of
business;
1.1.25 PERSON means any individual, sole proprietorship, partnership,
unincorporated association, unincorporated syndicate, unincorporated
organization, trust, body corporate, Governmental Authority, and a natural
person in such person's capacity as trustee, executor, administrator or other
legal representative;
1.1.26 PURCHASED SHARES means all of the issued and outstanding shares in
the share capital of Ixiem, as described in Schedule 2.1;
1.1.27 REAL PROPERTY LEASES means those leases, subleases, agreements to
lease, tenancy agreement, rights of occupation, licences and other agreements
relating to real property used or occupied by the Acquired Corporation;
1.1.28 TAX RETURNS includes, without limitation, all returns, reports,
declarations, elections, notices, filings, information returns and statements
filed in respect with Taxes; and
1.1.29 TAXES includes, without limitation, all taxes, duties, fees,
premiums, assessments, imposts, levies and other charges of any kind whatsoever
imposed by any Governmental Authority, together with all interest, penalties,
fines, additions to tax or other additional amounts imposed in respect thereof,
including, without limitation, those levied on, or measured by, or referred to
as income, gross receipts, profits, capital, transfer, land transfer, sales,
goods and services, use, value-added, excise, stamp, withholding, business,
franchising, property, payroll, employment, health, social services, education
and social security taxes, all surtaxes, all customs duties and import and
export taxes, all license, franchise and registration fees and all employment
insurance, health insurance and Canada, Quebec and other government pension plan
premiums.
1.1.30 VENDOR means Charron and Schlagalack on a joint and several basis.
1.2 CERTAIN RULES OF INTERPRETATION - In this Agreement and the Schedules:
---------------------------------
(a) TIME - time is of the essence in the performance of the parties'
----
respective obligations;
(b) CURRENCY - unless otherwise specified, all references to money amounts
--------
are to Canadian currency;
(c) HEADINGS - the descriptive headings of Articles and Sections are
--------
inserted solely for convenience of reference and are not intended as complete or
accurate descriptions of the content of such Articles or Sections;
(d) SINGULAR, ETC. - the use of words in the singular or plural, or with a
---------------
particular gender, shall not limit the scope or exclude the application of any
provision of this Agreement to such person or persons or circumstances as the
context otherwise permits;
(e) CALCULATION OF TIME - unless otherwise specified, time periods within or
-------------------
following which any payment is to be made or act is to be done shall be
calculated by excluding the day on which the period commences and including the
day on which the period ends and by extending the period to the next business
day following if the last day of the period is not a business day;
1.3 ENTIRE AGREEMENT - This Agreement together with the agreements and other
----------------
documents to be delivered pursuant to this Agreement, constitute the entire
agreement between the parties pertaining to the subject matter of this Agreement
and supercede all prior agreements, understandings, negotiations and
discussions, whether oral or written, of the parties, and there are no
warranties, representations or other agreements between the parties in
connection with the subject matter of this Agreement except as specifically set
forth in this Agreement and any document delivered pursuant to this Agreement.
No supplement, modification or waiver or termination of this Agreement shall be
binding unless executed in writing by the parties to be bound thereby.
1.4 APPLICABLE LAW - This Agreement shall be construed in accordance with
---------------
the laws of the Province of Quebec and the laws of Canada applicable therein and
shall be treated, in all respects, as a Quebec contract.
1.5 ACCOUNTING PRINCIPLES - All reference to generally accepted accounting
----------------------
principles means to principles recommended, from time to time, in the Handbook
of the Canadian Institute of Chartered Accountants and all accounting terms not
otherwise defined in this Agreement have the meanings assigned to them in
accordance with Canadian generally accepted accounting principles.
1.6 SCHEDULES - The schedules to this Agreement, as listed below, are an
---------
integral part of this Agreement:
Schedule Description
- -------- -----------
1.1.16 Financial Statements
1.1.20 Intellectual Property
2.1 Shareholding and Authorized Share Capital of Ixiem
4.2.4 List of Equipment
4.2.22 Insurance Policy
4.2.23 a) Material Contracts
4.2.24 Protectron bill
ARTICLE 2
ACQUISITION TRANSACTIONS
------------------------
2.1 PURCHASE AND SALE OF THE PURCHASED SHARES - Subject to the terms and
---------------------------------------------
conditions herein, the parties shall effect the following transactions:
(a) at the Closing Time, the Vendor shall sell, transfer and assign to the
Purchaser and the Purchaser shall purchase and accept the assignment of all the
Purchased Shares, as listed in Schedule 2.1;
(b) the Purchaser shall pay and satisfy the purchase price for the Purchased
Shares as provided in Section 3;
(c) at the Closing Time, the Vendor shall transfer and deliver to the
Purchaser share certificates representing the Purchased Shares duly endorsed in
blank for transfer;
(d) the parties shall effect all transactions contemplated in Section 11.
2.2 ACTIONS/DELIVERIES BY THE PARTIES - At or before the Closing Time, the
-----------------------------------
Vendor and the Purchaser shall take and cause to be taken all necessary and
desirable actions, steps and corporate and legal proceedings to approve and
authorize the transactions contemplated by this Agreement.
2.3 PLACE OF CLOSING - The Closing shall take place at the Closing Time at
------------------
the offices of Andre R. Dorais, located at 1, Westmount Square, 20th floor,
Westmount (Quebec), H3Z 2P9, or at such other place as may be agreed upon by the
Vendor and the Purchaser.
ARTICLE 3
PURCHASE PRICE
--------------
3.1 PURCHASE PRICE - The total purchase price ("Purchase Price") for the
---------------
Purchased Shares is equal to the following considerations:
TWO HUNDRED THOUSAND (200,000) shares of Common Stock of Purchaser
(collectively referred to as "Exchanged Shares"), payable subject to the terms
and conditions and in the manner described in Section 3.2 hereinafter;
ONE DOLLAR (1.00$) payable subject to the terms and conditions and in the manner
described in Section 3.2 hereinafter
It is being understood between the parties that said Exchanged Shares and the
amount of ONE DOLLAR (1.00$) shall constitute the entire and sole consideration
payable by the Purchaser to Vendor.
3.2 SATISFACTION OF PURCHASE PRICE
---------------------------------
The share consideration payable to the Vendor shall be paid by the
issuance, of the Exchanged Shares in favor of the Vendor as follows:
(a) i) the issuance in favor of Charron of 100,000 of the Exchanged
Shares which shall be released to Charron no later then six (6) months following
the Closing Date, subject to the terms and conditions herein;
ii) the issuance of these shares is also subject to the condition that
Charron works as a part time employee of the Purchaser or an affiliated company
of the latter for one (1) year starting on the Closing Date. It being
understood that, in the event that Charron stops working for the Purchaser or an
affiliated company, the Vendor will have to remit all the Exchange Shares to the
Purchaser;
(b) i) six (6) months after the anniversary of the Closing Date, the
issuance in favor of Charron of 100,000 of the Exchanged Shares, subject to the
terms and conditions herein;
ii) the issuance of these shares is also subject to the condition that
Charron works as a part time employee of the Purchaser or an affiliated company
of the latter for an additional one (1) year starting on the anniversary of the
Closing Date. It being understood that, in the event that Charron stops working
for the Purchaser or an affiliated company, the Vendor will have to remit
100,000 of the Exchange Shares to the Purchaser;
(c) In the event that Charron is dismissed without cause or laid off by the
Purchaser or an affiliated company of the latter, subject to the other terms and
conditions herein, all the Exchanged Shares shall be issued as if Charron was
still an employee of the Purchaser or an affiliated company.
The monetary consideration payable to the Vendor shall be paid as follows:
the payment of ONE DOLLAR (1.00$) by the Purchaser to Schlagalack at the Closing
Date.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
------------------------------
4.1 REPRESENTATIONS AND WARRANTIES CONCERNING THE VENDOR - The Vendor
---------------------------------------------------------
represents and warrants to the Purchaser as follows, and acknowledges that the
Purchaser is relying on said representations and warranties in entering into
this Agreement:
(A) RIGHT TO SELL - The Vendor is the sole registered and beneficial owner,
--------------
with good and marketable title thereto, of the Purchased Shares, the whole as
set out in Schedule 2.1 hereto, free and clear of all Encumbrances and prior
claim, hypothecs and pledges. The Vendor has the exclusive right to sell,
transfer and assign the Purchased Shares as provided in this Agreement and such
disposition will not violate, contravene, breach or offend against or result in
any default under any indenture, mortgage, lease, agreement, obligation,
instrument, charter or by-law provision, statute, regulation, order, judgment
decree, licence, permit or law to which the Vendor and the Acquired Corporation
is a party or subject or by which either of them are bound or affected.
(B) ENFORCEABILITY OF OBLIGATIONS - This Agreement has been duly authorized,
-----------------------------
executed and delivered by the Vendor and constitutes a valid and binding
obligation enforceable against him in accordance with its terms.
(C) ABSENCE OF CONFLICTING AGREEMENTS - The Vendor is not a party to, bound
----------------------------------
or affected by or subject to any indenture, mortgage, lease, agreement,
obligation, instrument, charter or by-law provision, statute, regulation, order,
judgment, decree, licence, permit or law which would be violated, contravened,
breached by, or under which default would occur or an Encumbrance would be
created as a result of the execution and delivery of this Agreement or any other
agreement to be entered into under the terms of this Agreement, or the
performance by the Vendor or the Acquired Corporation of any of their respective
obligations provided for under this Agreement or any other agreement
contemplated herein.
(D) NON-ARM'S LENGTH TRANSACTIONS - Neither the Vendor nor any Person not
-------------------------------
dealing at arm's length with him:
(a) owns, directly or indirectly, any interest in or is an employee,
consultant to or agent of, an entity which is a competitor, lessor, lessee,
customer or supplier of the Acquired Corporation;
(b) owns, directly or indirectly, any interest in any property or asset of
the Acquired Corporation;
(c) is a party to any Contract with any Acquired Corporation; or
(d) has any Indebtedness, liability or obligation to the Acquired
Corporation.
The Acquired Corporation is not indebted or otherwise obligated to the
Vendor or any Person not dealing at arm's length with any of them.
(E) RESIDENCE OF THE VENDOR - The Vendor is not a non-resident of Canada for
-----------------------
the purposes of the Income Tax Act (Canada).
(F) NO LITIGATION - There are no outstanding claims, actions, suits,
--------------
litigation or arbitrations, investigations or proceedings at law or before any
Governmental Authority pending or, to the knowledge of the Vendor, proposed or
threatened, which would prevent the Vendor from completing the transactions
required to be completed pursuant to this Agreement.
(G) BROKERS - The Vendor has not entered into any agreement that would
-------
entitle any Person to any claim against the Purchaser or the Acquired
Corporation for any broker's commission, finder's fee, agent's fee, fee for
financial intermediary services or any like payment in respect of the
transactions contemplated by this Agreement. To the knowledge of the Vendor, the
Acquired Corporation has not made or agreed to make any payment to any broker,
agent or professional advisor for or in connection with the transactions
contemplated in this Agreement.
4.2 REPRESENTATIONS AND WARRANTIES CONCERNING THE ACQUIRED CORPORATION -
----------------------------------------------------------------------
The Vendor represents and warrants to the Purchaser as follows, and acknowledges
that the purchaser is relying on said representations and warranties in entering
into this agreement:
4.2.1 INCORPORATION AND REGISTRATION - The Acquired Corporation is duly
--------------------------------
incorporated and validly existing under the laws of Quebec and has all necessary
corporate power, authority and capacity to own its properties and assets and to
carry on its business as presently conducted.
4.2.2 SUBSIDIARIES - Ixiem does not own, or have any interest in any
------------
securities of any other corporation.
4.2.3 CAPITALIZATION - The authorized and issued share capital of the
--------------
Acquired Corporation is as set forth in Schedule 2.1. All of the shares in the
capital of the Acquired Corporation have been duly authorized and validly issued
and are outstanding as fully paid and non-assessable shares of the Acquired
Corporation. No options, warrants or other rights to purchase shares or other
securities of the Acquired Corporation and no securities or obligations
convertible into or exchangeable for shares or other securities of the Acquired
Corporation have been authorized or agreed to be issued or are outstanding.
4.2.4 TITLE TO ASSETS - The Acquired Corporation is the sole beneficial and
----------------
sole owner of all of its respective assets and interests in assets, real and
personal, with good and valid title, free and clear of any Encumbrances.
Without limiting the foregoing, Ixiem is and remain at the Closing Date, the
sole owner, without any Encumbrances, of all electronic equipment listed in
Schedule 4.2.4.
4.2.5 ABSENCE OF CONFLICTING AGREEMENTS - The Acquired Corporation is not
------------------------------------
party to, bound or affected by or subject to any indenture, mortgage, lease,
agreement, obligation, instrument, charter or by-law provision, statute,
regulation, order, judgement, decree, licence, permit or law which would be
violated, contravened, breached by, or under which default would occur or an
Encumbrance would be created as a result of the execution and delivery of this
Agreement or any other agreement to be entered into under the terms of this
Agreement, or the performance by the Vendor or the Acquired Corporation of any
of their respective obligations provided for under this Agreement or any other
agreement contemplated herein.
4.2.6 REGULATORY APPROVALS - No governmental or regulatory authorization,
---------------------
approval, order, consent, or filing (save and except filing of declarations
under the Act Respecting the Legal Publicity of Sole Proprietorship,
Partnerships and Legal Persons (Quebec) and filing of appropriate forms to
Industry Canada) is required on the part of the Vendor or the Acquired
Corporation, in connection with the execution, delivery and performance of this
Agreement or any other documents and agreements to be delivered under this
Agreement or the performance of the Vendor's obligations under this Agreement or
any other documents and agreements to be delivered under this Agreement.
4.2.7 FINANCIAL STATEMENTS - The Financial Statements have been prepared in
---------------------
accordance with generally accepted accounting principles applied on a basis
consistent with that of the preceding period and present fairly:
(a) all of the assets, liabilities and financial position of the Acquired
Corporation as at the dates indicated; and
(b) the sales, earnings, results of operation and changes in financial
position of the Acquired Corporation for all of the dates and periods indicated.
4.2.8 ABSENCE OF LIABILITIES OF IXIEM - On the Closing Date, Ixiem has no
--------------------------------
liabilities or any obligation (whether accrued, absolute, contingent or
otherwise) outstanding.
4.2.9 ABSENCE OF CHANGES OR UNUSUAL TRANSACTIONS - Since the date of the
----------------------------------------------
Balance Sheet, Ixiem has carried on its business and conducted its operations
and affairs in the ordinary and normal course of business consistent with past
practice and there has not been:
(a) any material change in the financial condition or operations of Ixiem
other than changes in the ordinary and normal course of business, none of which
has been materially adverse;
(b) any damage, destruction, loss, labour trouble or other event,
development or condition of any character (whether or not covered by insurance)
materially and adversely affecting the business, assets or properties of Ixiem;
(c) any assumption of any obligation or liability (fixed or contingent),
except unsecured current obligations and liabilities incurred in the ordinary
and normal course of business;
(d) any discharge or satisfaction of any lien or encumbrance, or payment of
any obligation or liability (fixed or contingent) other than liabilities
included in the Balance Sheet and liabilities incurred since the date of the
Balance Sheet in the ordinary and normal course of business;
(e) any operating loss or any extraordinary loss, waiver or omission to take
any action in respect of any rights of substantial value, or entering into any
commitment or transaction not in the ordinary and normal course of business
where such loss, rights, commitment or transaction is or would be material in
relation to Ixiem;
(f) any mortgage, pledge, lien, grant of a security interest in or other
Encumbrance of any of its assets or property, whether tangible or intangible;
(g) directly or indirectly, any declaration or payment of any dividends or
declaration or making of any other payments or distributions on or in respect of
any of its shares or, directly or indirectly, the purchase or other acquisition
of any of its shares or any other capital outlays or expenditures by Ixiem or
withdrawals of capital from Ixiem; or
(h) the authorization, agreement or other commitment to do any of the
foregoing.
4.2.10 OPERATIONS- It is understood that Ixiem can terminate its Real
----------
Property Lease at its convenience, and that it has already moved its assets and
personnel to iVision Integral's premises situated at 1, Westmount Square,
Westmount, Quebec, and since that time, has concentrated its operations and
resources for the benefit of iVision Integral Inc. and accordingly has changed
its normal cause of business.
4.2.11 RESERVES AND ACCRUALS - The reserves and Accrued Liabilities
-----------------------
disclosed on or reflected in the Financial Statements and the Books and Records
are sufficient in all respects to provide for the liabilities in respect of
which they have been established and have been established in accordance with
generally accepted accounting principles. In particular, Ixiem has made adequate
provisions in its Books and Records for any write-downs required for
uncollectible Accounts Receivable, obsolete or unusable Inventories.
4.2.12 NO JOINT VENTURE INTERESTS, ETC. - The Acquired Corporation is not a
---------------------------------
partner, beneficiary, trustee, co-tenancy, joint venture or otherwise a
participant in any partnership, trust, joint venture, co-tenancy or other
similar jointly owned business undertaking and the Acquired Corporation has no
other significant investment interests in any business owned or controlled by
any third party.
4.2.13 ABSENCE OF GUARANTEES - The Acquired Corporation has not given or
-----------------------
agreed to give, or is a party or bound by, any guarantee or indemnity in respect
of indebtedness, or other obligations, of any Person, or any other commitment by
which the Acquired Corporation is responsible for such indebtedness or other
obligations.
4.2.14 ABSENCE OF ACCOUNTS RECEIVABLE - On the Closing Date, there is no
---------------------------------
Account Receivable outstanding.
4.2.15 BUSINESS IN COMPLIANCE WITH LAW - In all material respects, the
-----------------------------------
operations of Ixiem have been and are now conducted in compliance with all
applicable Laws of each jurisdiction in which Ixiem carries on or has carried on
business and Ixiem has not received any notice of any alleged breach of any such
Laws. The Governmental Authorizations are all such authorizations required by
Ixiem to enable it to carry on its business in compliance with applicable Laws.
Such Governmental Authorizations are in full force and effect in accordance with
their terms, and there have been no violations thereof and no proceedings are
pending or, to the knowledge of the Vendor, threatened, which could result in
their revocation or limitation.
4.2.16 RESTRICTIVE COVENANTS - Ixiem is not a party to or bound or affected
----------------------
by any commitment, agreement or document containing any covenant expressly
limiting the freedom of Ixiem to compete in any line of business, transfer or
move any of its assets or operations or which materially or adversely affects
the business practices, operations or conditions of Ixiem or the continued
operation of its business after the Closing on substantially the same basis as
its business is presently carried on.
4.2.17 INTELLECTUAL PROPERTY -
----------------------
(a) The only Intellectual property of the Acquired Corporation is limited to
that as described in Schedule 1.1.20.
(b) The Vendor has no knowledge of any claim of adverse ownership,
invalidity or other opposition with any of the Intellectual Property nor of any
pending or threatened suit, proceeding, claim, demand, action or investigation
of any nature or kind against any of the Acquired Corporation.
4.2.18 EQUIPMENT CONTRACTS - The Acquired Corporation is not party or
--------------------
otherwise bound by any Equipment Contracts.
4.2.19 REAL PROPERTY LEASES -
----------------------
(a) Ixiem is not party to any Real Property Leases other than the Real
Property lease entered with the Vendor (hereinafter "Lease");
(b) All payments required to be made by Ixiem pursuant to the Lease have
been duly paid and Ixiem is not otherwise in default in meeting its obligations
under the Lease.
(c) Ixiem may, at its entire discretion, unilaterally terminate the Lease
simply upon giving a five (5) days written notice to that effect. Ixiem
declares that it can terminate the Lease, without penalty, charges or other
rental payments at its convenience.
4.2.20 EMPLOYMENT MATTERS -
-------------------
(a) At the Closing Date, there will not be any employee working for Ixiem.
(b) There were no employment policies, practices or plans, including
policies, practices or plans regarding incentive compensation, stock options,
severance pay or other terms or conditions of employment which were binding upon
Ixiem.
(c) Ixiem has been operating in full compliance with all Laws relating to
employees, including labour standards, occupational health and safety,
industrial accidents and occupational diseases, human rights, pay equity and
employment equity. To the best of Vendor's knowledge, there have been no
complaints under such Laws against Ixiem.
(e) All amounts owing in respect of salary, wages, bonus or benefits
including any vacation pay, severance pay, termination pay or indemnity in lieu
of notice, have been paid.
(f) No employee has a claim for overtime or time off in lieu of overtime or
for a leave of absence with or without pay, which has not been paid.
(g) Ixiem has no agreement, written or verbal, with any independent persons,
consultants or other independent contractors which was not terminated before the
Closing Date.
(h) No dependent or independent contractors or sub-contractors are in
default of complying with any legal obligations that could bind Ixiem.
4.2.21 COLLECTIVE AGREEMENTS - Ixiem is not and was never a party, either
----------------------
directly or by operation of law, to any Collective Agreement which would have
covered any of its employees or any dependent contractors of Ixiem.
4.2.22 INSURANCE - The only insurance policy that Ixiem maintains is
---------
attached herewith in Schedule 4.2.22.
4.2.23 CONTRACTS -
---------
(a) Except for the Material Contracts attached in Schedule 4.2.23(a), Ixiem
is not a party to or bound by any Material Contract. The Material Contracts
listed in Schedule 4.2.23(a) are all in full force and effect, unamended, and no
default exists under such Material Contracts on the part of any of the parties
to such Contracts. None of the Material Contracts include provisions requiring
consent to a change of control of the Company.
(b) There are no current or pending negotiations with respect to the
renewal, repudiation or amendment of any such Material Contract.
4.2.24 LITIGATION - Except for the Protectron bill attached in Schedule
----------
4.2.24, there is no suit, action, litigation, investigation, claim, complaint,
grievance or proceeding, including appeals and applications for review, in
progress, or, to the knowledge of the Vendor, pending or threatened against or
relating to Acquired Corporation before any court, Governmental Authority,
commission, board, bureau, agency or arbitration panel. The Vendor has no
knowledge of any existing ground on which any such action, suit, litigation or
proceeding might be commenced with any reasonable likelihood of success. There
is not presently outstanding against Acquired Corporation any judgment, decree,
injunction, rule or order of any court, Governmental Authority, commission,
board, bureau, agency or arbitrator.
4.2.25 TAX MATTERS -
------------
(a) The Acquired Corporation has duly and timely filed their its Tax Returns
with the appropriate Governmental Authority and has duly, completely and
correctly reported all income and all other amounts and information required to
be reported thereon.
(b) The Acquired Corporation has duly and timely paid all Taxes, including
all installments on account of Taxes for the current year that are due and
payable and the Acquired Corporation has established reserves that are
reflected on the Balance Sheet that are adequate for the payment of all Taxes
that are not yet due and payable (and that will not be due and payable by the
Closing Date) and that relate to periods ending on or prior to Closing Date.
(c) The Acquired Corporation has not requested, or entered into any
agreement or other arrangement or executed any waiver providing for, any
extension of time within which (i) to file any Tax Return covering any Taxes for
which the Acquired Corporation is or may be liable; (ii) to file any elections,
designations or similar things relating to Taxes for which the Acquired
Corporation is or may be liable; (iii) the Acquired Corporation is required to
pay or remit any Taxes or amounts on account of Taxes; or (iv) any Governmental
Authority may assess or collect Taxes for which the Acquired Corporation is or
may be liable.
(d) The Canadian federal and provincial income and capital tax liabilities
of the Acquired Corporation have been assessed by the relevant taxing
authorities and notices of assessment have been issued to the Acquired
Corporation by the relevant taxing authorities for all taxation years prior to
and including the taxation year ended December 31st 1998.
(e) There are no actions, suits, proceedings, investigations, audits or
claims now pending or, to the knowledge of the Vendor, threatened, against the
Acquired Corporation in respect of any Taxes and there are no matters under
discussion, audit or appeal with any Governmental Authority relating to Taxes.
The Vendor hereby jointly and severally agree to forthwith pay the full amount
of any reassessment against Ixiem arising out of events which occurred before
the Closing Date.
(f) The Acquired Corporation has duly and timely withheld from any amount
paid or credited by it to or for the account or benefit of any Person,
including, without limitation, any of its employees, officers and directors and
any non-resident Person, the amount of all Taxes and other deductions required
by any applicable Law, to be withheld from any such amount and has duly and
timely remitted the same to the appropriate Governmental Authority.
(g) The Acquired Corporation has not acquired property from or disposed of
property to a Person with whom it does not deal at arm's length for purposes of
the Income Tax Act (Canada) for proceeds of disposition which are greater or
less than the fair market value of the property acquired or disposed.
4.2.26 BOOKS AND RECORDS - All Books and Records of the Acquired Corporation
-----------------
have been delivered or made available to the Purchaser. Such Books and Records
fairly and correctly set out and disclose in all material respects the financial
position of the Acquired Corporation and all financial transactions of the
Acquired Corporation have been accurately recorded in such Books and Records.
4.2.27 CORPORATE RECORDS AND MINUTE BOOKS - The corporate records and minute
----------------------------------
books of the Acquired Corporation have been delivered or made available to the
Purchaser. The articles and by-laws are in full force and effect and no
amendments have been made to the same. The minute books, including the articles
and by-laws of the Acquired Corporation, include complete and accurate minutes
of all meetings of the directors or shareholders of the Acquired Corporation, as
applicable, held to date or resolutions passed by the directors or shareholders
on consent, since the date of incorporation of the Acquired Corporation. The
share certificates book, register of shareholders, register of transfers and
register of directors of the Acquired Corporation, are complete and accurate.
4.2.28 BANK ACCOUNTS, ETC. - On the Closing Date, Ixiem has no bank account
--------------------
or credit line or any loan, whatsoever.
4.2.29 NO ASSOCIATED/RELATED COMPANIES - Except for Schlagalack, no
---------------------------------
companies are or have been "associated" with or "related" to the Acquired
Corporation for purposes of the Income Tax Act (Canada) or corresponding
provincial tax legislation.
4.2.30 NON-ARM'S LENGTH TRANSACTIONS -
-------------------------------
(a) The Acquired Corporation has not, since the date of the Balance Sheets,
made any payment or loan to, or borrowed any moneys from or is otherwise
indebted to, any officer, director, employee, shareholder or any other person
not dealing at arm's length of the Acquired Corporation, except in the ordinary
and normal course of business;
(b) The Acquired Corporation is not a party to any Contract with any
officer, director, employee, shareholder or any other person not dealing at
arm's length with the Acquired Corporation;
(c) No officer, director or shareholder of the Acquired Corporation and no
entity which is an affiliate or associate of one or more of such individuals:
(i) owns, directly or indirectly, any interest in (except for shares
representing less than one percent of the outstanding shares of any class or
series of any publicly traded company), or is an officer, director, employee or
consultant of, any person which is, or is engaged in business as, a competitor
of Ixiem or a lessee, supplier, distributor, sales agent or customer of Ixiem;
(ii) owns, directly or indirectly, in whole or in part, any property that Ixiem
uses in the operation of its business; or (iii) has any cause of action or other
claim whatsoever against, or owes any amount to, the Acquired Corporation,
except for any liabilities reflected in the Interim Financial Statements and
claims in the ordinary and normal course of business such as for accrued
vacation pay and accrued benefits for employees.
4.2.31 FULL DISCLOSURE - All information, which has been provided to the
----------------
Purchaser is true and correct in all material respects and no material fact or
facts have been omitted therefrom which would make such information misleading.
4.3 REPRESENTATIONS AND WARRANTIES CONCERNING SCHLAGALACK - Charron
---------------------------------------------------------
represents and warrants to the Purchaser as follows:
4.3.1 INCORPORATION - Schlagalack is a company duly incorporated and validly
-------------
existing under the laws of Quebec, Canada
4.3.2 ENFORCEABILITY OF OBLIGATIONS - This Agreement has been duly
-------------------------------
authorized and executed by Schlagalack and constitutes a valid and binding
obligation for Schlagalack enforceable against it in accordance with its terms.
4.3.3 ABSENCE OF CONFLICTING AGREEMENTS - Schlagalack is not a party to,
------------------------------------
bound or affected by or subject to any indenture, mortgage, lease, agreement,
obligation, instrument, charter or bylaw provision, statute, regulation, order,
judgement, decree, license, permit or law which would be violated, contravened
or breached by, or under which any default would occur or a lien, claim,
restriction or encumbrance would be created as a result of the execution and
delivery by it of this Agreement or the performance by it of any of the terms of
this Agreement.
4.3.4 SHAREHOLDER - Charron is the sole registered and beneficial owner with
-----------
good and marketable title of all the shares of Schlagalack.
4.3.5 NO AGREEMENTS, OPTIONS, ETC - No person, partnership, association,
------------------------------
firm, corporation or other entity has any written or oral agreement, option,
understanding or commitment for the purchase of any of the Purchased Shares.
4.3.6 NO SUBSCRIPTION RIGHTS - No person, partnership, association, firm,
-----------------------
corporation or other entity has any written or oral agreement, option,
understanding or commitment, including without limitations convertible
securities, warrants or convertible obligations of any nature, for the purchase,
subscription, allotment or issuance of any of the Purchased Shares.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
-----------------------------------------------
The Purchaser hereby represents and warrants to the Vendor the matters
set out below.
5.1 INCORPORATION - The Purchaser is a corporation duly incorporated and
-------------
validly existing under the laws of Nevada, U.S.A.
5.2 ENFORCEABILITY OF OBLIGATIONS - This Agreement has been duly authorized,
-----------------------------
executed and delivered by the Purchaser and constitutes a valid and binding
obligation of the Purchaser enforceable against it in accordance with its terms.
5.3 ABSENCE OF CONFLICTING AGREEMENTS - The Purchaser is not a party to,
------------------------------------
bound or affected by or subject to any indenture, mortgage, lease, agreement,
obligation, instrument, charter or bylaw provision, statute, regulation, order,
judgement, decree, license, permit or law which would be violated, contravened
or breached by, or under which any default would occur or a lien, claim,
restriction or encumbrance would be created as a result of the execution and
delivery by it of this Agreement or the performance by it of any of the terms of
this Agreement.
5.4 LITIGATION - There is no suit, action, litigation, investigation, claim,
----------
complaint or proceeding before any Governmental Authority in progress or, to the
knowledge of the Purchaser, pending or threatened against or relating to the
Purchaser, which, if determined adversely to the Purchaser, would, prevent the
Purchaser from fulfilling any of its obligations set out in, arising from or in
connection with this Agreement, and the Purchaser has no knowledge of any
existing ground on which any such action, suit, litigation or proceeding might
be commenced with any reasonable likelihood of success.
5.5 NO AGREEMENTS, OPTIONS, ETC - No person, partnership, association, firm,
---------------------------
corporation or other entity has any written or oral agreement, option,
understanding or commitment for the purchase of any of the Exchanged Shares.
5.6 NO SUBSCRIPTION RIGHTS - No person, partnership, association, firm,
------------------------
corporation or other entity has any written or oral agreement, option,
understanding or commitment, including without limitations convertible
securities, warrants or convertible obligations of any nature, for the purchase,
subscription, allotment or issuance of any of the Exchanged Shares.
5.7 REGISTRATION AND DISPOSITION OF EXCHANGED SHARES - The Exchanged
-----------------------------------------------------
Shares to be issued pursuant to Section 3 of this Agreement have not been
registered under the U.S. Securities Act of 1933, as amended (the "Act"), and
may not be offered, sold or otherwise transferred unless such securities are
included in an effective registration statement under the Act or an opinion of
U.S. counsel concurred in by counsel to the Purchaser has been delivered to the
effect that registration of such securities is not required based upon
applicable exemption from registration. Such an exemption, by way of example
only, may be available under rule 144 of the Act, which requires, among other
things, that the securities be owned and fully paid for a minimum of one (1)
year prior to the sale, that such sales be effected through a registered
broker/dealer and that there be current public information, regarding the issued
shares, available to the public. This is a summary of the requirements of that
rule and is not intended to be a complete statement of its requirements.
5.8 TAXES - The Purchaser has duly filed all tax returns required to be
-----
filed by it and has paid all taxes which are due and payable, including but not
limited to income taxes, goods and services taxes, provincial or state sales
taxes, payroll taxes, workman's compensation and all deductions required at
source, and has paid all assessments and reassessments, and all other Taxes,
dues, governmental charges, penalties, interest and fines due and payable by it.
5.9 RESIDENCY - The Purchaser is not a resident of Canada within the
---------
meaning of the Income Tax Act (Canada) and the Taxation Act (Quebec).
5.10 NON-VIOLATION - The entering into of this Agreement and the
-------------
performance by the Purchaser of the transactions contemplated under and pursuant
to this Agreement does not and will not i) conflict with, result in a breach of
the terms, conditions, or provisions of, or constitute a default under the
articles or by-laws of the Purchaser or any agreement, written or oral, to which
the Purchaser of any of its affiliates are subject, or ii) violate any laws or
regulations applicable to the Purchaser including the Securities Act (Quebec),
or iii) require any consent or other action by any administrative or
governmental body, including, without limiting the foregoing, the Commission des
valeurs mobili res du Qu bec or any securities exchange commission.
ARTICLE 6
NON-WAIVER; SURVIVAL
--------------------
6.1 NON-WAIVER - No investigations made by or on behalf of the Purchaser at
----------
any time shall have the effect of waiving, diminishing the scope of or otherwise
affecting any representation or warranty made by the Vendor in or pursuant to
this Agreement. No waiver of any condition or other provision, in whole or in
part, shall constitute a waiver of any other condition or provision (whether or
not similar) nor shall such waiver constitute a continuing waiver unless
otherwise expressly provided.
6.2 NATURE AND SURVIVAL - All representations, warranties and covenants
---------------------
contained in this Agreement on the part of each of the parties shall survive the
Closing, the execution and delivery under this Agreement of any share or
security transfer instruments or other documents of title to any of the
Purchased Shares, except that:
(a) any claim for intentional misrepresentation or fraud may be brought at
any time;
(b) the representations and warranties set out in Section 4 shall survive
and continue in full force and effect without limitation of time;
(c) representations and warranties concerning Tax matters shall survive for
a period of ninety days after the relevant authorities shall no longer be
entitled to assess liability for Tax against the Acquired Corporation or the
Purchaser as the case may be for any particular taxation year ended on or prior
to the Closing Date; and
(d) all other representations and warranties shall survive for a period of
three (3) years from the Closing Date.
ARTICLE 7
PURCHASER'S CONDITIONS PRECEDENT
--------------------------------
The obligation of the Purchaser to complete the purchase of the
Purchased Shares under this Agreement shall be subject to the satisfaction of,
or compliance with, at or before the Closing Time, each of the following
conditions precedent (each of which is acknowledged to be inserted for the
exclusive benefit of the Purchaser and may be waived, in writing or verbally, by
the Purchaser in whole or in part):
7.1 TRUTH AND ACCURACY OF REPRESENTATIONS CONCERNING THE VENDOR AND THE
------------------------------------------------------------------------
ACQUIRED CORPORATION AT THE CLOSING TIME - All of the representations and
-----------------------------------------
warranties concerning the Vendor and the Acquired Corporation made in or
--
pursuant to this Agreement shall be true and correct as at the Closing Time and
--
with the same effect as if made at and as of the Closing Time.
7.2 PERFORMANCE OF OBLIGATIONS - The Vendor shall have performed or complied
--------------------------
with, in all respects, their respective obligations, covenants and agreements
under this Agreement.
7.3 RECEIPT OF CLOSING DOCUMENTATION - All documentation relating to the due
--------------------------------
authorization and completion of the sale and purchase of the Purchased Shares
under this Agreement and all actions and proceedings taken on or prior to the
Closing in connection with the performance by the Vendor of their respective
obligations under this Agreement, shall be satisfactory to the Purchaser, acting
reasonably, and the Purchaser shall have received copies of all such
documentation or other evidence as it may reasonably request in order to
establish the consummation of the transactions contemplated hereby and the
taking of all corporate proceedings in connection therewith in compliance with
these conditions, in form (as to certification and otherwise) and substance
satisfactory to the Purchaser acting reasonably.
7.4 CONSENTS, AUTHORIZATIONS AND REGISTRATIONS - All consents, approvals,
---------------------------------------------
orders and authorizations of any Person or Governmental Authority (or
registrations, declarations, filings or recordings with any such authorities),
on the part of the Vendor required in connection with the completion of any of
the transactions contemplated by this Agreement, the execution of this
Agreement, the Closing or the performance of any of the terms and conditions of
this Agreement, shall have been obtained at or before the Closing Time.
7.5 RESIGNATIONS AND RELEASES - There shall have been delivered to the
---------------------------
Purchaser on or before the Closing Time the resignations of all individuals who
are presently directors or officers of the Acquired Corporation from all offices
and positions with the Acquired Corporation as an employee of Ixiem and duly
executed comprehensive releases in form and substance satisfactory to the
Purchaser from the Vendor of all their claims, respectively, against the
Acquired Corporation.
ARTICLE 8
VENDOR'S CONDITIONS PRECEDENT
-----------------------------
The obligations of the Vendor to complete the sale of the Purchased
Shares under this Agreement shall be subject to the satisfaction of or
compliance with, at or before the Closing Time, each of the following conditions
precedent (each of which is acknowledged to be inserted for the exclusive
benefit of the Vendor and may be waived, in writing or verbally, by them in
whole or in part).
8.1 TRUTH AND ACCURACY OF REPRESENTATIONS OF THE PURCHASER AT CLOSING TIME -
----------------------------------------------------------------------
All of the representations and warranties of the Purchaser made in or pursuant
to this Agreement shall be true and correct as at the Closing Time and with the
same effect as if made at and as of the Closing Time.
8.2 PERFORMANCE OF OBLIGATIONS - The Purchaser shall have performed or
----------------------------
complied with, in all respects, all its obligations, covenants and agreements
under this Agreement.
8.3 RECEIPT OF CLOSING DOCUMENTATION - All documentation relating to the
-----------------------------------
due authorization and completion of the sale and purchase of the Purchased
Shares under this Agreement and all actions and proceedings taken on or prior to
the closing in connection with the performance by the Purchaser of its
obligations under this Agreement, shall be satisfactory to the Vendor, acting
reasonably, and the Vendor shall received copies of all such documentation or
other evidence as he may reasonably request in order to establish the
consummation of the transactions contemplated hereby and the taking of all
corporate proceedings in connection therewith in compliance with these
conditions.
ARTICLE 9
OTHER COVENANTS OF THE PARTIES
------------------------------
9.1 ACTIONS TO SATISFY CLOSING CONDITIONS - Each of the parties agrees to
----------------------------------------
take all such actions as are within its power to control, and to use all
reasonable efforts to cause other actions to be taken which are not within its
power to control, so as to ensure compliance with each of the conditions and
covenants set forth in this Agreement which are for the benefit of any other
Party.
9.2 CONSENT TO JURISDICTION - Each of the parties irrevocably attorns and
-------------------------
submits to the exclusive jurisdiction of any Quebec court sitting in Montreal in
any action or proceeding arising out of or related to this Agreement and
irrevocably agrees that all claims in respect of any such action or proceeding
shall be heard and determined in such Quebec court. Each of the parties
irrevocably waives, to the fullest extent possible, the defense of an
inconvenient forum to the maintenance of such action or proceeding.
ARTICLE 10
INDEMNIFICATION
---------------
10.1 INDEMNIFICATION BY THE VENDOR - The Vendor agrees to indemnify and save
-----------------------------
harmless the Purchaser and Ixiem on an after-tax basis as well as the directors
and officers of Ixiem against all Losses suffered or incurred as a result of or
arising directly or indirectly out of or in connection with any breach by the
Vendor of or any inaccuracy of any of the representations and warranties of the
Vendor made by the Vendor on a joint and several basis under this Agreement or
any breach or non-performance by the Vendor of any covenant to be performed by
the Vendor on a joint and several basis under this Agreement or any agreement,
instrument, certificate or other document delivered pursuant hereto.
10.2 NOTIFICATION OF AND PARTICIPATION IN CLAIMS - No Claim will arise until
-------------------------------------------
notice thereof is given to the party (the Indemnitor ) from whom indemnity is
sought. Such notice shall be sent within a reasonable time following the
determination by a party (the Claimant ) that a Claim for indemnity exists. In
the event that any legal proceedings shall be instituted or any Claim or demand
is asserted by any third party in respect of which the Indemnitor may have an
obligation to indemnify the Claimant, the Claimant shall give or cause to be
given to the Indemnitor written notice thereof and the Indemnitor shall have the
right, at its option and expense, to be present at the defense of such
proceedings, claim or demand, but not to control the defense, negotiation or
settlement thereof, which control shall at all times rest with the Claimant,
unless the Indemnitor irrevocably acknowledges full and complete responsibility
for indemnification of Claimant, in which case the Indemnitor may assume such
control through counsel of its choice, provided however, that no settlement
shall be entered into without the Claimant's written consent (which shall not be
unreasonably withheld). The parties hereto agree to cooperate fully with each
other in connection with the defense, negotiation or settlement of any such
third party legal proceeding, claim or demand.
10.3 MISCELLANEOUS - Notwithstanding anything in this Agreement to the
-------------
contrary, the indemnity provided for in this Article 10 shall apply to any loss,
liability, damage, deficiency or expense, whether or not the actual amount
thereof shall have been ascertained prior to the final day upon which a Claim
for indemnity with respect thereto may be made hereunder, so long as written
notice thereof shall have been given to the Indemnitor prior to said date,
setting forth specifically and in reasonable detail, so far as is known, the
matter as to which indemnification is being sought, but nothing herein shall be
construed to require payment of any claim for indemnity until the actual amount
payable shall have been finally ascertained. In addition, any Claims for
damages payable hereunder shall be adjusted, in accordance with Canadian
generally accepted accounting principles, to reflect the after-tax effect
thereof.
10.4 REDUCTION OF LOSSES - The amount of Losses payable by the Vendor
---------------------
shall be reduced by the aggregate amount of:
(a) any insurance proceeds received by the Purchaser or by the Acquired
Corporation or a successor corporation, for and in relation to those Losses,
subject to such reduction not resulting in a loss of coverage or reduction of
the insurance proceeds received or to be received by the Purchaser or the
Acquired Corporation (or a successor corporation) or increase of future
insurance premiums which are attributable to such Losses. If insurance proceeds
for Losses are received by the Purchase or by the Acquired Corporation or a
successor corporation after the Vendor has performed his obligations to
indemnify under this Agreement in connection with such Losses, then the
Purchaser or the Acquired Corporation or a successor corporation, as the case
may be, shall remit to the Vendor the amount of such insurance proceeds;
(b) any reduction in Taxes otherwise payable by the Acquired Corporation or
a successor corporation arising from or relating to the Loss.
Where all or part of the Loss generates a reduction in Taxes the amount of
the reduction in Taxes shall reduce the Loss by an equal amount.
ARTICLE 11
PROCEDURES AT CLOSING OR AFTER
11. DELIVERY OF CLOSING DOCUMENTS - The following shall occur:
--------------------------------
a) The Vendor shall at Closing Time:
(i) deliver to the Purchaser certificates respecting all of the Purchased
shares duly endorsed in blank for transfer;
(ii) cause the transfer of the Purchased shares to be duly registered and
regularly recorded in the name of the Purchaser in the books and corporate
records of the Acquired Corporation;
(iii) deliver to the Purchaser certificates respecting all of the issued
shares of the Acquired Corporation;
(iv) deliver to the Purchaser the minute books and corporate records of the
Acquired Corporation;
(v) deliver to the Purchaser a non-competition agreement and a
non-disclosure agreement duly executed by the Vendor;
(vi) execute receipts;
(vii) deliver releases in favor of the Acquired Corporation.
(b) The Purchaser shall:
(i) deliver to the Vendor, as provided in Section 3, share certificates
respecting all of the Exchanged Shares issued for the Closing;
(ii) remit to Schlagalack, as provided in Section 3, ONE DOLLAR (1.00$);
(iii) at Closing Time, deliver a certified copy of resolutions of the Board
of Directors of the Purchaser and iVision Integral Inc. authorizing the
transactions herein;
ARTICLE 12
GENERAL
-------
12.1 PUBLIC NOTICES - All public notices to third parties and all other
---------------
publicity concerning the transactions contemplated by this Agreement shall be
jointly planned and coordinated by the Vendor and the Purchaser and no party
shall act unilaterally in this regard without the prior approval of the other
party, such approval not to be unreasonably withheld, except where required to
do so by law or by the applicable regulations or policies of any provincial or
Canadian or other regulatory agency of competent jurisdiction or any stock
exchange in circumstances where prior consultation with the other party is not
practicable.
12.2 EXPENSES - The Vendor and the Purchaser shall pay their respective
--------
legal, accounting, and other professional advisory fees, costs and expenses
incurred in connection with the purchase and sale of the Purchased Shares and
the preparation, execution and delivery of this Agreement and all documents and
instruments executed pursuant to this Agreement and any other costs and expenses
incurred by the party.
12.3 NOTICES - Any notice or other writing required or permitted to be given
-------
under this Agreement or for the purposes of this Agreement (in this Section
referred to as a Notice ) shall be in writing and shall be sufficiently given
if delivered, or if transmitted by facsimile or other form of recorded
communication tested prior to transmission to such party:
(a) in the case of a Notice to the Vendor:
Francois Charron
1270, Marconi Street
Drummondville, Quebec
J2B 8E9
(b) in the case of a Notice to the Purchaser at:
iVision Integral Inc.
1 Westmount Square # 650
Westmount (Quebec) H3Z 2P9
or at such other address as the party to whom such Notice is to be given shall
have last notified the party giving the same in the manner provided in this
Section. Any Notice delivered to the party to whom it is addressed as provided
above shall be deemed to have been given and received on the day it is so
delivered at such address, provided that if such day is not a Business Day then
the Notice shall be deemed to have been given and received on the next Business
Day. Any Notice transmitted by facsimile or other form of recorded communication
shall be deemed given and received on the first Business Day after its
transmission.
12.4 ASSIGNMENT - Neither this Agreement nor any benefits or burdens under
----------
this Agreement shall be assignable by any party without the prior written
consent of each of the other parties. Subject to the foregoing, this Agreement
shall enure to the benefit of and be binding upon the parties and their
respective heirs, executors, legal representatives, successors (including any
successor by reason of amalgamation of any party) and permitted assigns.
12.5 FURTHER ASSURANCES - The parties shall, with reasonable diligence, do
-------------------
all such things and provide all such reasonable assurances as may be required to
consummate the transactions contemplated by this Agreement, and each party shall
provide such further documents or instruments required by any other party as may
be reasonably necessary or desirable to effect the purpose of this Agreement and
carry out its provisions, whether before or after the Closing.
12.6 REMEDIES CUMULATIVE - Except as otherwise herein expressly provided,
--------------------
the rights and remedies of the parties under this Agreement are cumulative and
in addition to and not in substitution for any rights or remedies provided by
law. Any single or partial exercise by any party hereto of any right or remedy
for default or breach of any term, covenant or condition of this Agreement does
not waive, alter, affect or prejudice any other right or remedy to which such
party may be lawfully entitled for the same default or breach.
12.7 LANGUAGE - The parties declare that they have requested and do hereby
--------
confirm their request that this Agreement be drawn up in English; les parties d
clarent qu'elles ont exig et par les pr sentes confirment leur demande que ce
contrat soit r dig en anglais.
12.8 COUNTERPARTS AND FACSIMILE - This Agreement may be executed by the
----------------------------
parties in separate counterparts and by facsimile each of which when so executed
and delivered shall be an original, but all such counterparts shall together
constitute one and the same instrument.
IN WITNESS WHEREOF the parties have duly executed this Agreement at the
place and date herein above mentioned.
IVISION GROUP LTD. FRANCOIS CHARRON
Per: /s/ Andre Dorais Francois Charron
____________________ _____________________
Andre Dorais, Director Francois Charron
SCHLAGALACK INC. IXIEM! PRODUCTION INC.
Per: /s/ Francois Charron Per /s/ Francois Charron
____________________ _____________________
Francois Charron Francois Charron
MEMORANDUM OF SHARE PURCHASE AGREEMENT MADE AND ENTERED INTO ON THE 30TH DAY OF
JULY 1999
BETWEEN: IVISION GROUP LTD., a corporation duly incorporated under the laws
of Nevada, U.S.A., and having its head office at 3230 East Flamingo Road, Suite
156, Las Vegas, Nevada, U.S.A. 89121, acting and represented hereby by Philippe
Racine, its President, duly authorized as he so declares,
(hereinafter referred to as the Purchaser );
PARTY OF THE FIRST PART;
----------------------------
AND: ALAIN BERGERON, a businessman, domiciled and residing at 8460 Ouimet
Street, Brossard, Quebec, J4Y 3B5;
(hereinafter referred to as Bergeron );
PARTY OF THE SECOND PART;
-----------------------------
AND: H L NE JULIEN, a businesswoman, domiciled and residing at 8460 Ouimet
Street, Brossard, Quebec, J4Y 3B5;
(hereinafter referred to as Julien );
PARTY OF THE THIRD PART;
----------------------------
AND: LA SOCI T DE GESTION LOUIS MARTIN INC., a corporation duly
incorporated under the Laws of Canada and having its head office at 320 Victoria
Avenue, # 403, St-Lambert, Quebec, J4P 2H8, acting and represented hereby by
Louis Martin, its President, duly authorized as he so declares;
(hereinafter referred to as Martin Co. );
PARTY OF THE FOURTH PART;
-----------------------------
(Bergeron, Julien and Martin Co. are hereinafter individually referred to
as the Vendor and collectively as the Vendors );
WHEREAS the Purchaser is a publicly traded company listed on the OTC
Bulletin Board, involved in web commerce interactive marketing and related
matters;
WHEREAS Javanaise Information Services Corporation Inc., a corporation duly
incorporated under the Canada Business Corporations Act, having its head office
and principal place of business at 1200 McGill College, Suite 1100, Montreal,
Quebec, Canada, H3B 4G1 (hereinafter referred to as Javanaise Co. ), is a web
project management consulting corporation;
WHEREAS all the issued and outstanding shares in the share capital of Javanaise
Co. are owned equally (50-50), under the Laws of Quebec, by Martin Co. and
Bergeron Conseils et R alisations Inc., a corporation duly incorporated and
having its head office at 8460 Ouimet Street, Brossard, Quebec, Canada, J4Y 3B5
(hereinafter referred to as Bergeron Co. );
WHEREAS Bergeron and Julien own, in the proportion of 60% and 40%
respectively, all the issued and outstanding shares of Bergeron Co.;
WHEREAS the Purchaser wishes to purchase and Bergeron and Julien wish to
sell to the Purchaser all of the issued and outstanding shares in the share
capital of Bergeron Co.; and
WHEREAS the Purchaser wished to purchase and Martin Co. wishes to sell to
Purchaser all of the issued and outstanding shares owned by Martin Co. in the
share capital of Javanaise Co.;
NOW THEREFORE, THIS AGREEMENT WITNESSETH that in consideration fo the
mutual covenants hereinafter provided, the parties agree as follows:
ARTICLE 1
DEFINITIONS AND PRINCIPLES OF INTERPRETATION
--------------------------------------------
1.1 DEFINITIONS - Whenever used in this Agreement, unless there is something
-----------
inconsistent in the subject matter or context, the following words and terms
shall have the meanings set out below:
1.1.1 AB EMPLOYMENT AGREEMENT means the employment agreement entered into
as of the date hereof by Bergeron and iVision Integral Inc., as amended in
writing from time to time, and any renewal or replacement thereof;
1.1.2 ACCOUNTS RECEIVABLE means any and all accounts receivable, bills
receivable, trade accounts, book debts and insurance claims of any of the
Acquired Corporations as the case may be and any other amount due to any
Acquired Corporations including any refunds and rebates, and the benefit of all
security (including cash deposits), guarantees and other collateral held by any
Acquired Corporations;
1.1.3 ACCRUED LIABILITIES means any and all accrued liabilities of any
Acquired Corporations incurred in the ordinary course of business, including
accruals for vacation pay, customer rebates and allowances for product returns;
1.1.4 ACQUIRED CORPORATIONS means collectively Javanaise Co. and Bergeron
Co.;
1.1.5 AGREEMENT means this Share Purchase Agreement, including all
schedules, and all instruments supplementing or amending or confirming this
Agreement and references to Article or Section mean and refer to the
specified Article or Section of this Agreement;
1.1.6 ARM'S LENGTH means arm's length as defined in the Income Tax Act
(Canada);
1.1.7 BALANCE SHEETS means in case of Javanaise Co. the balance sheets as
at March 31st, 1999 and in case of Bergeron Co. , the balance sheets as at
January 31st, 1999;
1.1.8 BOOKS AND RECORDS means all books and records of any Acquired
Corporations, including financial, corporate, operation and sales books,
records, books of account, sales and purchase records, lists of suppliers and
customers, business reports, plans and projections and all other documents,
files, records, correspondence, and other data and information, financial or
otherwise, including without limitation, all data and information stored on
computer-related media;
1.1.9 CLAIMS means any claim, demand, action, cause of action, damage,
loss, costs, liability or expense, including, without limitation, reasonable
professional fees and all costs incurred in pursuing any of the foregoing;
1.1.10 CLOSING means the completion of the sale to and purchase by the
Purchaser of the Purchased Shares under this Agreement and all ancillary
transactions contemplated hereof;
1.1.11 CLOSING DATE means the 30th day of July 1999, or such other date as
the parties may agree in writing as the date upon which the Closing shall take
place;
1.1.12 CLOSING TIME means 12:00 noon, Montreal time, on the Closing Date
or such other time on such date as the parties may agree in writing as the time
at which the Closing shall take place;
1.1.13 CONTRACTS means all contracts, licences, leases, agreements,
commitments, entitlements and engagements of the Acquired Corporations whether
written or oral and includes all quotations, orders or tenders for contracts
which remain open for acceptance and any supplier's warranty, guarantee or
commitment (express or implied);
1.1.14 CONSULTING AGREEMENT means the consulting agreement entered into as
of the date hereof by Louis Martin Conseils Inc. and iVision Integral Inc., as
amended in writing from time to time, and any renewal or replacement thereof;
1.1.15 ENCUMBRANCE means any pledge, lien, charge, hypothec, security
agreement, lease, title retention agreement, mortgage, encumbrance or option;
1.1.16 EQUIPMENT CONTRACTS means all leases, equipment leases, conditional
sales contracts, leasings, installment sales, title retention agreements and
other similar agreements relating to equipment;
1.1.17 ESCROW AGENT means Andr R. Dorais, lawyer, having his place of
business at 1 Westmount Square, 20th Floor, Westmount, Quebec, H3Z 2P9, Canada;
1.1.18 ESCROW AGREEMENT means an agreement among the Purchaser, the
Vendors and the Escrow Agent dated as of the Closing Date substantially in the
form attached hereto as Schedule 1.1.18;
1.1.19 EXCHANGED SHARES means collectively all shares of Common Stock in
the share capital of the Purchaser issued to the Vendors pursuant to section 3
of this Agreement and the Escrow Agreement;
1.1.20 FINANCIAL STATEMENTS means in case of Javanaise Co. the unaudited
financial statements for the fiscal year ended March 31st, 1999 and in case of
Bergeron Co. the unaudited financial statements for the fiscal year ended
January 31st, 1999 copies of which are attached as Schedule 1.1.21;
1.1.21 GOVERNMENTAL AUTHORITY means any government, regulatory authority,
governmental department, agency, commission, board, tribunal, crown corporation,
or court or other law, rule or regulation-making entity having or purporting to
have jurisdiction on each of the Acquired corporations, as the case may be;
1.1.22 GOVERNMENTAL AUTHORIZATION means all authorizations, approvals,
licences or permits issued, granted, given, or otherwise made available by or
under the authority of any Governmental Authority as required pursuant to Laws;
1.1.23 INDEBTEDNESS means the indebtedness of the Acquired Corporations
for borrowed money including principal and accrued interest and the cost of
repayment of any indebtedness of the Acquired Corporations for borrowed money;
1.1.24 INTELLECTUAL PROPERTY means all copyrights, trademarks, trade
names, proprietary information, trade secrets and all other intellectual
property owned by, licensed to or used by the Acquired Corporations (including
applications and registrations for any of the foregoing and renewals, divisions,
extensions and reissues, where applicable, pertaining thereto);
1.1.25 INVENTORIES means all inventories of every kind and nature and
wheresoever situate owned by the Acquired Corporations including, without
limitation, all work-in-progress;
1.1.26 LAWS means all applicable laws, by-laws, rules, regulations,
orders, ordinances and judgements or other requirements of any Governmental
Authority;
1.1.27 LOSSES means any damage, liability, loss, cost, expense (including
all reasonable attorney's), deficiency, interest, penalty, impositions,
assessments or fines;
1.1.28 MATERIAL CONTRACTS means (a) the Equipment Contracts, Real Property
Leases; (b) any other Contract involving aggregate annual payments to or by any
Acquired Corporations in excess of $5,000.00; (c) any commitment to or by the
Acquired Corporations that may reasonably extend beyond three (3) months from
the Closing Date; and (d) any Contract which is outside the ordinary course of
business;
1.1.29 PERSON means any individual, sole proprietorship, partnership,
unincorporated association, unincorporated syndicate, unincorporated
organization, trust, body corporate, Governmental Authority, and a natural
person in such person's capacity as trustee, executor, administrator or other
legal representative;
1.1.30 PURCHASED BERGERON CO. SHARES means all of the issued and
outstanding shares in the share capital of Bergeron Co., as described in
Schedule 2.1;
1.1.31 PURCHASED LM SHARES means all of the issued and outstanding shares
owned by Martin Co. in the share capital of Javanaise Co., as described in
Schedule 2.1;
1.1.32 PURCHASED SHARES means both the Purchased Bergeron Co. Shares and
the Purchased LM Shares;
1.1.33 REAL PROPERTY LEASES means those leases, subleases, agreements to
lease, tenancy agreement, rights of occupation, licences and other agreements
relating to real property used or occupied by the Acquired Corporations;
1.1.34 SHAREHOLDERS AGREEMENT means the shareholders agreement dated April
10, 1997 between Martin Co., Bergeron Co. and Javanaise Co.;
1.1.35 TAX RETURNS includes, without limitation, all returns, reports,
declarations, elections, notices, filings, information returns and statements
filed in respect with Taxes; and
1.1.36 TAXES includes, without limitation, all taxes, duties, fees,
premiums, assessments, imposts, levies and other charges of any kind whatsoever
imposed by any Governmental Authority, together with all interest, penalties,
fines, additions to tax or other additional amounts imposed in respect thereof,
including, without limitation, those levied on, or measured by, or referred to
as income, gross receipts, profits, capital, transfer, land transfer, sales,
goods and services, use, value-added, excise, stamp, withholding, business,
franchising, property, payroll, employment, health, social services, education
and social security taxes, all surtaxes, all customs duties and import and
export taxes, all license, franchise and registration fees and all employment
insurance, health insurance and Canada, Quebec and other government pension plan
premiums.
1.2 CERTAIN RULES OF INTERPRETATION - In this Agreement and the Schedules:
---------------------------------
(a) TIME - time is of the essence in the performance of the parties'
----
respective obligations;
(b) CURRENCY - unless otherwise specified, all references to money amounts
--------
are to Canadian currency;
(c) HEADINGS - the descriptive headings of Articles and Sections are
--------
inserted solely for convenience of reference and are not intended as complete or
accurate descriptions of the content of such Articles or Sections;
(d) SINGULAR, ETC. - the use of words in the singular or plural, or with a
---------------
particular gender, shall not limit the scope or exclude the application of any
provision of this Agreement to such person or persons or circumstances as the
context otherwise permits;
(e) CALCULATION OF TIME - unless otherwise specified, time periods within or
-------------------
following which any payment is to be made or act is to be done shall be
calculated by excluding the day on which the period commences and including the
day on which the period ends and by extending the period to the next business
day following if the last day of the period is not a business day;
1.3 ENTIRE AGREEMENT - This Agreement together with the agreements and other
----------------
documents to be delivered pursuant to this Agreement, constitute the entire
agreement between the parties pertaining to the subject matter of this Agreement
and supercede all prior agreements, understandings, negotiations and
discussions, whether oral or written, of the parties, and there are no
warranties, representations or other agreements between the parties in
connection with the subject matter of this Agreement except as specifically set
forth in this Agreement and any document delivered pursuant to this Agreement.
No supplement, modification or waiver or termination of this Agreement shall be
binding unless executed in writing by the parties to be bound thereby.
1.4 APPLICABLE LAW - This Agreement shall be construed in accordance with
---------------
the laws of the Province of Quebec and the laws of Canada applicable therein and
shall be treated, in all respects, as a Quebec contract.
1.5 ACCOUNTING PRINCIPLES - All reference to generally accepted accounting
----------------------
principles means to principles recommended, from time to time, in the Handbook
of the Canadian Institute of Chartered Accountants and all accounting terms not
otherwise defined in this Agreement have the meanings assigned to them in
accordance with Canadian generally accepted accounting principles.
1.6 SCHEDULES - The schedules to this Agreement, as listed below, are an
---------
integral part of this Agreement:
Schedule Description
- -------- -----------
1.1.18 Escrow Agreement
1.1.20 Financial Statements
2.1 Vendors, Shareholdings and Authorized Share Capital
4.2.4 List of electronic Equipment
4.2.20 a) List of Employees
4.2.20 b) Employment Agreements
4.2.22 Insurance Policy
4.2.23 a) Material Contracts
ARTICLE 2
ACQUISITION TRANSACTIONS
------------------------
2.1 PURCHASE AND SALE OF THE PURCHASED SHARES - Subject to the terms and
---------------------------------------------
conditions herein, at the Closing Time, the parties shall effect the following
transactions:
(a) the Vendors shall sell, transfer and assign to the Purchaser and the
Purchaser shall purchase and accept the assignment of all the Purchased Shares,
as listed opposite the Vendor's respective name in Schedule 2.1;
(b) the Purchaser shall pay and satisfy the purchase price for the Purchased
Shares as provided in Section 3;
(c) the Vendors shall transfer and deliver to the Purchaser share
certificates representing the Purchased Shares duly endorsed in blank for
transfer;
(d) the parties shall effect all transactions contemplated in Section 11.
2.2 ACTIONS/DELIVERIES BY THE PARTIES - At or before the Closing Time, the
-----------------------------------
Vendors and the Purchaser shall take and cause to be taken all necessary and
desirable actions, steps and corporate and legal proceedings to approve and
authorize the transactions contemplated by this Agreement.
2.3 PLACE OF CLOSING - The Closing shall take place at the Closing Time at
------------------
the offices of Andre R. Dorais, located at 1 Westmount Square, 20th floor,
Westmount (Quebec), H3Z 2P9, or at such other place as may be agreed upon by the
Vendors and the Purchaser.
ARTICLE 3
PURCHASE PRICE AND PAYMENT
--------------------------
3.1 PURCHASE PRICE - The total purchase price ("Purchase Price") for the
---------------
Purchased Shares is equal to the following cash and shares considerations:
(a) ONE HUNDRED FIFTY THOUSAND CANADIAN DOLLARS (CDN $150,000.00) in cash,
payable in the manner described in Sections 3.2.1 hereinafter; and
(b) SIXTY-EIGHT THOUSAND (68,000) shares of Common Stock of Purchaser
(collectively referred to as "Exchanged Shares"), payable in the manner
described in Section 3.2.2 hereinafter;
it being understood between the parties that said amount of CDN $150,000.00 plus
the Exchanged Shares shall constitute the entire and sole consideration payable
by the Purchaser to Vendors.
3.2 SATISFACTION OF PURCHASE PRICE - The Purchaser shall pay and satisfy the
------------------------------
Purchase Price payable to the Vendors as follows:
3.2.1 CASH CONSIDERATION (CDN $150,000.00)
---------------------------------------
The amount of ONE HUNDRED FIFTY THOUSAND CANADIAN DOLLARS (CDN $150,000.00)
shall be paid to the Vendors in TWO (2) installments as follows:
(a) CDN $75,000.00 - at Closing Date, by the remittance of a certified
cheque in the amount of TWENTY-TWO THOUSAND FIVE HUNDRED CANADIAN DOLLARS (CDN
$22,500.00) to the order of Bergeron, a certified cheque in the amount of
FIFTEEN THOUSAND CANADIAN DOLLARS (CDN $15,000.00) to the order of Julien, and a
certified cheque in the amount of THIRTY-SEVEN THOUSAND FIVE HUNDRED CANADIAN
DOLLARS (CDN $37,500.00) to the order of Martin Co., receipt of which is hereby
acknowledged by each of the Vendors; and
(b) CDN $75,000.00 - at the earliest of i) September 30, 1999 or ii) the
closing of a financing of greater than ONE MILLION U.S. DOLLARS (US
$1,000,000.00) for the Purchaser, by remittance of a certified cheque in the
amount of TWENTY-TWO THOUSAND FIVE HUNDRED CANADIAN DOLLARS (CDN $22,500.00) to
the order of Bergeron, a certified cheque in the amount of FIFTEEN THOUSAND
CANADIAN DOLLARS (CDN $15,000.00) to the order of Julien, and a certified cheque
in the amount of THIRTY-SEVEN THOUSAND FIVE HUNDRED CANADIAN DOLLARS (CDN
$37,500.00) to the order of Martin Co.
3.2.2 EXCHANGED SHARES
-----------------
The share consideration payable to the Vendors shall be paid by the
issuance, on or before Closing Date, of the Exchanged Shares in favor of the
Vendors as follows:
(a) the issuance in favor of Bergeron of 20,400 of the Exchanged Shares,
10,200 of which shall immediately be released to Bergeron on Closing Date and
the other 10,200 shall be remitted to the Escrow Agent to be held and released
(and/or cancelled) in accordance with the terms and conditions of the Escrow
Agreement;
(b) the issuance in favor of Julien of 13,600 of the Exchanged Shares, 6,800
of which shall immediately be released to Julien on Closing Date and the other
6,800 shall be remitted to the Escrow Agent to be held and released (and/or
cancelled) in accordance with the terms and conditions of the Escrow Agreement;
and
(c) the issuance in favor of Martin Co. of 34,000 of the Exchanged Shares,
17,000 of which shall immediately be released to Martin Co. on Closing Date and
the other 17,000 shall be remitted to the Escrow Agent to be held and released
(and/or cancelled) in accordance with the terms and conditions of the Escrow
Agreement.
3.3 ALLOCATION OF PURCHASE PRICE - The Purchase Price shall be allocated
-------------------------------
equally (50-50) between the Purchased LM Shares and the Purchased Bergeron Co.
Shares and, the portion payable for Purchased Bergeron Co. Shares shall itself
be prorated between Bergeron and Julien in the proportion of 60% and 40%
respectively.
ARTICLE 4
4.1.1 REPRESENTATIONS AND WARRANTIES CONCERNING BERGERON AND JULIEN - Each
-------------------------------------------------------------
of Bergeron and Julien represents and warrants to the Purchaser on a joint and
several basis as follows, and acknowledges that the Purchaser is relying on said
representations and warranties in entering into this Agreement:
(A) RIGHT TO SELL - Bergeron and Julien are the sole registered and
---------------
beneficial owners of the Purchased Bergeron Co. Shares in the proportion of 60%
and 40% respectively, the whole as set out in Schedule 2.1 hereto, free and
clear of all Encumbrances and prior claims. All of the issued and outstanding
shares of Javanaise Co. are owned by Martin Co. and Bergeron Co., as set out in
Schedule 2.1 hereto, as the registered and beneficial owners, with good and
marketable title thereto, and the shares of Javanaise Co. owned by Bergeron Co.
are free and clear of all hypothecs, pledges and prior claims. Bergeron and
Julien have the exclusive right to sell, transfer and assign the Purchased
Bergeron Co. Shares as provided in this Agreement and such disposition will not
violate, contravene, breach or offend against or result in any default under any
indenture, mortgage, lease, agreement, obligation, instrument, charter or by-law
provision, statute, regulation, order, judgment decree, licence, permit or law
to which either of Bergeron, Julien and the Acquired Corporations is a party or
subject or by which either of them are bound or affected. The Purchased
Bergeron Co. shares are not subject to the terms of any Shareholder's Agreement
(unanimous or otherwise) other than the Shareholder Agreement which has been
terminated on the date hereof.
(B) ENFORCEABILITY OF OBLIGATIONS - This Agreement has been duly authorized,
-----------------------------
executed and delivered by each of Bergeron and Julien and constitutes a valid
and binding obligation of each of them enforceable against him (her) in
accordance with its terms.
(C) ABSENCE OF CONFLICTING AGREEMENTS - Neither of Bergeron and Julien is a
----------------------------------
party to, bound or affected by or subject to any indenture, mortgage, lease,
agreement, obligation, instrument, charter or by-law provision, statute,
regulation, order, judgment, decree, licence, permit or law which would be
violated, contravened, breached by, or under which default would occur or an
Encumbrance would be created as a result of the execution and delivery of this
Agreement or any other agreement to be entered into under the terms of this
Agreement, or the performance by Bergeron and Julien or the Acquired
Corporations of any of their respective obligations provided for under this
Agreement or any other agreement contemplated herein.
(D) NON-ARM'S LENGTH TRANSACTIONS - Neither Bergeron and Julien nor any
-------------------------------
Person not dealing at arm's length with any of them:
(a) owns, directly or indirectly, any interest in or is an employee,
consultant to or agent of, an entity which is a competitor, lessor, lessee,
customer or supplier of the Javanaise Co.;
(b) owns, directly or indirectly, any interest in any property or asset of
any Acquired Corporations;
(c) is a party to any Contract with any Acquired Corporations; or
(d) has any Indebtedness, liability or obligation to the Acquired
Corporations.
Subject to Section 9.3, the Acquired Corporations are not indebted or
otherwise obligated to Bergeron and Julien or any Person not dealing at arm's
length with any of them.
(E) RESIDENCE OF BERGERON AND JULIEN - Neither of Bergeron and Julien is a
----------------------------------
non-resident of Canada for the purposes of the Income Tax Act (Canada).
(F) NO LITIGATION - There are no outstanding claims, actions, suits,
--------------
litigation or arbitrations, investigations or proceedings at law or before any
Governmental Authority pending or, to the knowledge of the Vendors, proposed or
threatened, which would prevent the Vendors from completing the transactions
required to be completed pursuant to this Agreement.
(G) BROKERS - Neither of Bergeron and Julien have entered into any agreement
-------
that would entitle any Person to any claim against the Purchaser or the Acquired
Corporations for any broker's commission, finder's fee, agent's fee, fee for
financial intermediary services or any like payment in respect of the
transactions contemplated by this Agreement. To the knowledge of Bergeron and
Julien, the Acquired Corporations have not made or agreed to make any payment to
any broker, agent or professional advisor for or in connection with the
transactions contemplated in this Agreement.
4.1.2 REPRESENTATIONS AND WARRANTIES CONCERNING MARTIN CO. - Martin Co.
-------------------------------------------------------
represents and warrants to the Purchaser as follows, and acknowledges that the
Purchaser is relying on said representations and warranties in entering into
this Agreement:
(A) RIGHT TO SELL - Martin Co. is the sole registered and beneficial owner
---------------
of the Purchased LM Shares, as described in Schedule 2.1 hereto, free and clear
of all Encumbrances and prior claims. All of the issued and outstanding shares
of Javanaise Co. are owned by Martin Co. and Bergeron Co., as described in
Schedule 2.1 hereto, as the registered and beneficial owners, with good and
marketable title thereto, and the Purchased LM Shares are free and clear of all
hypothecs, pledges and prior claims. Martin Co. has the exclusive right to
sell, transfer and assign the Purchased LM Shares as provided in this Agreement
and such disposition will not violate, contravene, breach or offend against or
result in any default under any indenture, mortgage, lease, agreement,
obligation, instrument, charter or by-law provision, statute, regulation, order,
judgment decree, licence, permit or law to which Martin co. is a party or
subject or by which he is bound or affected. The Purchased LM Shares are not
subject to the terms of any Shareholder's Agreement (unanimous or otherwise)
other than the Shareholder Agreement which has been terminated on the date
hereof.
(B) ENFORCEABILITY OF OBLIGATIONS - This Agreement has been duly authorized,
-----------------------------
executed and delivered by Martin Co. and constitutes a valid and binding
obligation of it enforceable against it in accordance with its terms.
(C) ABSENCE OF CONFLICTING AGREEMENTS - Martin Co. is not a party to, bound
----------------------------------
or affected by or subject to any indenture, mortgage, lease, agreement,
obligation, instrument, charter or by-law provision, statute, regulation, order,
judgment, decree, licence, permit or law which would be violated, contravened,
breached by, or under which default would occur or an Encumbrance would be
created as a result of the execution and delivery of this Agreement or any other
agreement to be entered into under the terms of this Agreement, or the
performance by Martin Co. or Javanaise Co. of any of their respective
obligations provided for under this Agreement or any other agreement
contemplated herein.
(D) NON-ARM'S LENGTH TRANSACTIONS - Martin Co. nor any Person not dealing at
-----------------------------
arm's length with it:
(a) owns, directly or indirectly, any interest in or is an employee,
consultant to or agent of, an entity which is a competitor, lessor, lessee or
customer of the Javanaise Co.;
(b) owns, directly or indirectly, any interest in any property or asset of
any Acquired Corporations;
(c) is a party to any Contract, save and except for its verbal consulting
agreement entered into with Javanaise Co. which shall be terminated at Closing
Time; or
(d) has any Indebtedness, liability or obligation to the Acquired
Corporations.
Javanaise Co. is not indebted or otherwise obligated to Martin Co. or any
Person not dealing at arm's length with it.
(E) RESIDENCE OF MARTIN CO. - Martin Co. is not a non-resident of Canada for
-----------------------
the purposes of the Income Tax Act (Canada).
(F) NO LITIGATION - There are no outstanding claims, actions, suits,
--------------
litigation or arbitrations, investigations or proceedings at law or before any
Governmental Authority pending or, to the knowledge of Martin Co., proposed or
threatened, which would prevent Martin Co. from completing the transactions
required to be completed pursuant to this Agreement.
(G) BROKERS - Martin Co. has not entered into any agreement that would
-------
entitle any Person to any claim against the Purchaser or the Acquired
Corporations for any broker's commission, finder's fee, agent's fee, fee for
financial intermediary services or any like payment in respect of the
transactions contemplated by this Agreement. To the knowledge of Martin Co.,
Javanaise Co. has not made or agreed to make any payment to any broker, agent or
professional advisor for or in connection with the transactions contemplated in
this Agreement.
4.2 REPRESENTATIONS AND WARRANTIES CONCERNING THE ACQUIRED CORPORATIONS -
----------------------------------------------------------------------
Each of the Vendors, it being understood however that Martin Co. does not make
any representations and warranties with respect to Bergeron Co. and accordingly
its representations and warranties described hereof are strictly limited to
Javanaise Co.
4.2.1 INCORPORATION AND REGISTRATION - Both Acquired Corporations are duly
--------------------------------
incorporated and validly existing under the laws of Canada and have all
necessary corporate power, authority and capacity to own their property and
assets and to carry on their business as presently conducted.
4.2.2 SUBSIDIARIES - Javanaise Co. does not own, or have any interest in any
------------
securities of any other corporation. Bergeron Co. does not own, or have any
interest in any securities of any other corporation other than shares in the
capital share of Javanaise Co.
4.2.3 CAPITALIZATION - The authorized and issued share capital of the
--------------
Acquired Corporations is as set forth in Schedule 2.1. All of the shares in the
capital of the Acquired Corporations have been duly authorized and validly
issued and are outstanding as fully paid and non-assessable shares of the
Acquired Corporations. No options, warrants or other rights to purchase shares
or other securities of the Acquired Corporations and no securities or
obligations convertible into or exchangeable for shares or other securities of
the Acquired Corporations have been authorized or agreed to be issued or are
outstanding, except for the Shareholders Agreement which has been terminated on
or before the Closing Date.
4.2.4 TITLE TO ASSETS - The Acquired Corporations are the sole beneficial
-----------------
and sole owner of all of their respective assets and interests in assets, real
and personal, with good and valid title, free and clear of any Encumbrances.
Without limiting the foregoing, Javanaise Co. is and remain at the Closing Date,
the sole owner, without any Encumbrances, of all electronic equipment listed in
Schedule 4.2.4.
4.2.5 ASSETS AND LIABILITIES OF BERGERON CO. - At Closing Time, the shares
---------------------------------------
of Javanaise Co. owned by Bergeron Co. shall constitute the sole assets of
Bergeron Co. Bergeron Co. carries on no active business and its sole activities
consist of holding shares of Javanaise Co. Bergeron Co. has no Accounts
Receivable, Accrued Liabilities, Indebtedness, Inventories and is not party or
otherwise bound by any Material Contract or any other liabilities or obligations
whatsoever and has no employees.
4.2.6 ABSENCE OF CONFLICTING AGREEMENTS - The Acquired Corporations are not
----------------------------------
party to, bound or affected by or subject to any indenture, mortgage, lease,
agreement, obligation, instrument, charter or by-law provision, statute,
regulation, order, judgement, decree, licence, permit or law which would be
violated, contravened, breached by, or under which default would occur or an
Encumbrance would be created as a result of the execution and delivery of this
Agreement or any other agreement to be entered into under the terms of this
Agreement, or the performance by the Vendors or the Acquired Corporations of any
of their respective obligations provided for under this Agreement or any other
agreement contemplated herein.
4.2.7 REGULATORY APPROVALS - No governmental or regulatory authorization,
---------------------
approval, order, consent, or filing (save and except filing of declarations
under the Act Respecting the Legal Publicity of Sole Proprietorship,
Partnerships and Legal Persons (Quebec) and filing of appropriate forms to
Industry Canada) is required on the part of the Vendors or the Acquired
Corporations, in connection with the execution, delivery and performance of this
Agreement or any other documents and agreements to be delivered under this
Agreement or the performance of the Vendors' obligations under this Agreement or
any other documents and agreements to be delivered under this Agreement.
4.2.8 FINANCIAL STATEMENTS - The Financial Statements have been prepared in
---------------------
accordance with generally accepted accounting principles applied on a basis
consistent with that of the preceding period and present fairly:
(a) all of the assets, liabilities and financial position of the Acquired
Corporations as at the dates indicated; and
(b) the sales, earnings, results of operation and changes in financial
position of the Acquired Corporations for all of the dates and periods
indicated.
4.2.9 ABSENCE OF UNDISCLOSED LIABILITIES OF JAVANAISE CO. - Subject to
--------------------------------------------------------
Section 4.2.10 hereinafter, since the date of the Balance Sheets, Javanaise Co.
has not incurred any liabilities or obligations (whether accrued, absolute,
contingent or otherwise), which continue to be outstanding, other than
liabilities and obligations incurred in the ordinary and normal course of
business, none of which has been materially adverse.
4.2.10.1 ABSENCE OF CHANGES OR UNUSUAL TRANSACTIONS - Subject to paragraph
--------------------------------------------
4.2.10.2 hereinafter, since the date of the Balance Sheet, Javanaise Co. has
carried on its business and conducted its operations and affairs in the ordinary
and normal course consistent with past practice and there has not been:
(a) any material change in the financial condition or operations of
Javanaise Co. other than changes in the ordinary and normal course of business,
none of which has been materially adverse;
(b) any damage, destruction, loss, labour trouble or other event,
development or condition of any character (whether or not covered by insurance)
materially and adversely affecting the business, assets or properties of
Javanaise Co.;
(c) any assumption of any obligation or liability (fixed or contingent),
except unsecured current obligations and liabilities incurred in the ordinary
and normal course of business;
(d) any discharge or satisfaction of any lien or encumbrance, or payment of
any obligation or liability (fixed or contingent) other than liabilities
included in the Balance Sheet and liabilities incurred since the date of the
Balance Sheet in the ordinary and normal course of business;
(e) any operating loss or any extraordinary loss, waiver or omission to take
any action in respect of any rights of substantial value, or entering into any
commitment or transaction not in the ordinary and normal course of business
where such loss, rights, commitment or transaction is or would be material in
relation to Javanaise Co.;
(f) any grant of any bonuses, whether monetary or otherwise, or the making
or announcement of any general wage or salary increases in respect of its
employees, or change in the terms of employment for any Employee except in the
ordinary and normal course of business and consistent with past practice;
(g) any mortgage, pledge, lien, grant of a security interest in or other
Encumbrance of any of its assets or property, whether tangible or intangible;
(h) directly or indirectly, any declaration or payment of any dividends or
declaration or making of any other payments or distributions on or in respect of
any of its shares or, directly or indirectly, the purchase or other acquisition
of any of its shares or any other capital outlays or expenditures by Javanaise
Co. or withdrawals of capital from Javanaise Co.; or
(i) the authorization, agreement or other commitment to do any of the
foregoing.
4.2.10.2 MATERIAL CHANGE - Notwithstanding terms of Sections 4.2.9,
----------------
4.2.10.1(a), (c) and (e), 4.2.11 and 4.2.14, it is understood that, during the
month of June, Javanaise Co. has terminated its Real Property Lease, moved its
assets and personnel to iVision Integral's premises situated at 1 Westmount
Square, Westmount, Quebec, and since that time, has concentrated its operations
and resources for the benefit of iVision Integral Inc. and accordingly has
changed its normal cause of business and as a result most of its Accounts
Receivable are with iVision Integral Inc.
4.2.11 RESERVES AND ACCRUALS - Subject to Section 4.2.10.2 above, the
-----------------------
reserves and Accrued Liabilities disclosed on or reflected in the Financial
Statements and the Books and Records are sufficient in all respects to provide
for the liabilities in respect of which they have been established and have been
established in accordance with generally accepted accounting principles. In
particular, Javanaise Co. has made adequate provisions in its Books and Records
for any write-downs required for uncollectible Accounts Receivable, obsolete or
unusable Inventories.
4.2.12 NO JOINT VENTURE INTERESTS, ETC. - The Acquired Corporations are not
---------------------------------
a partner, beneficiary, trustee, co-tenancy, joint venture or otherwise a
participant in any partnership, trust, joint venture, co-tenancy or other
similar jointly owned business undertaking and the Acquired Corporations have no
other significant investment interests in any business owned or controlled by
any third party.
4.2.13 ABSENCE OF GUARANTEES - The Acquired Corporations have not given or
-----------------------
agreed to give, or are a party or bound by, any guarantee or indemnity in
respect of indebtedness, or other obligations, of any Person, or any other
commitment by which the Acquired Corporations are, or are contingently,
responsible for such indebtedness or other obligations.
4.2.14 COLLECTIBILITY OF ACCOUNTS RECEIVABLE - Subject to 4.2.10.2, the
----------------------------------------
Accounts Receivable are bona fide, good and collectible at the aggregate
recorded amounts. To the best of the knowledge of the Vendors, the Accounts
Receivable are not subject to any defense, counterclaim or set off.
4.2.15 BUSINESS IN COMPLIANCE WITH LAW - In all material respects, the
-----------------------------------
operations of Javanaise Co. have been and are now conducted in compliance with
all applicable Laws of each jurisdiction in which Javanaise Co. carries on or
has carried on business and Javanaise Co. has not received any notice of any
alleged breach of any such Laws. The Governmental Authorizations are all such
authorizations required by Javanaise Co. to enable it to carry on its business
in compliance with applicable Laws. Such Governmental Authorizations are in full
force and effect in accordance with their terms, and there have been no
violations thereof and no proceedings are pending or, to the knowledge of the
Vendors, threatened, which could result in their revocation or limitation.
4.2.16 RESTRICTIVE COVENANTS - Save and except for confidential agreement
----------------------
disclosed and attached as Schedule 4.2.23 a), Javanaise Co. is not a party to or
bound or affected by any commitment, agreement or document containing any
covenant expressly limiting the freedom of Javanaise Co. to compete in any line
of business, transfer or move any of its assets or operations or which
materially or adversely affects the business practices, operations or conditions
of Javanaise Co. or the continued operation of its business after the Closing on
substantially the same basis as its business is presently carried on.
4.2.17 INTELLECTUAL PROPERTY -
----------------------
(a) The only Intellectual property of the Acquired Corporations is limited
to "Javanaise" name and relating logo which used by Javanaise Co. in connection
with its business.
(b) The Vendors have no knowledge of any claim of adverse ownership,
invalidity or other opposition with any of the Intellectual Property nor of any
pending or threatened suit, proceeding, claim, demand, action or investigation
of any nature or kind against any of the Acquired Corporations.
4.2.18 EQUIPMENT CONTRACTS - The Acquired Corporations are not party or
--------------------
otherwise bound by any Equipment Contracts.
4.2.19 REAL PROPERTY LEASES -
----------------------
(a) Javanaise Co. is not party to any Real Property Leases other than the
Real Property lease entered into on May 6th, 1998 with Execu-Centre Inc., as
attached herewith in Schedule 4.2.23a) (hereinafter "Execu-Lease");
(b) All payments required to be made by Javanaise Co. pursuant to
Execu-Lease have been duly paid and Javanaise Co. is not otherwise in default in
meeting its obligations under Execu-Lease.
(c) Javanaise Co. may, at its entire discretion, unilaterally terminate the
Execu-Lease simply upon giving a thirty (30) days written notice to that effect.
Javanaise Co. declares having sent such a notice to Lessor on or before June
1st, 1999 and therefore the Execu-Lease was terminated, without penalty, charges
or other rental payments by the end of June 1999.
4.2.20 EMPLOYMENT MATTERS -
-------------------
(a) Schedule 4.2.20(a) sets forth a complete list of all employees of
Javanaise Co., together with the titles and, save and except for employees
having entered into an employment agreement as disclosed in Schedule 4.2.20(b),
material terms of employment, including, current salaries and bonus (whether
monetary or otherwise) paid or payable to each such employee. No Employee is on
long-term disability leave, maternity, parental or other extended leave or
absence or receiving workers' compensation or may be considered as permanently
or temporarily disabled according to the Act Respecting Industrial Accidents and
Occupational Diseases (R.S.Q., c. A-3.001).
(b) There are written contracts, as attached herewith in Schedule
4.20.20(b), of employment entered into with all employees save and except with
Bergeron.
(c) There are no employment policies, practices or plans, including
policies, practices or plans regarding incentive compensation, stock options,
severance pay or other terms or conditions of employment which employees may be
terminated, which are binding upon Javanaise Co.
(d) Javanaise Co. has been and is being operated in full compliance with all
Laws relating to employees, including labour standards, occupational health and
safety, industrial accidents and occupational diseases, human rights, pay equity
and employment equity. To the best of Vendors' knowledge, there have been no
complaints under such Laws against Javanaise Co.
(e) All amounts owing in respect of salary, wages, bonus or benefits
including any vacation pay, severance pay, termination pay or indemnity in lieu
of notice, have been paid or accrued for on the Books and Records.
(f) No employee has a claim for overtime or time off in lieu of overtime or
for a leave of absence with or without pay, which has not been accrued, on the
Books and Records.
(g) Javanaise Co. has no agreement, written or verbal, with any independent
persons, consultants or other independent contractors save and except with
Martin Co. which agreement shall be terminated on or before Closing Date.
(h) No dependent or independent contractors or sub-contractors are in
default of complying with any legal obligations that could bind Javanaise Co.
4.2.21 COLLECTIVE AGREEMENTS - Javanaise Co. is not a party, either
----------------------
directly or by operation of law, to any Collective Agreement which would cover
any of its employees or any dependent contractors of Javanaise Co.
4.2.22 INSURANCE - The only insurance policy which Javanaise Co. maintains
---------
is attached herewith in Schedule 4.2.22.
4.2.23 CONTRACTS -
---------
(a) Except for the Material Contracts attached in Schedule 4.2.23(a) and the
existing verbal agreement with iVision Integral Inc., Javanaise Co. is not a
party to or bound by any Material Contract. The Material Contracts listed in
Schedule 4.2.23a) are all in full force and effect, unamended, and no default
exists under such Material Contracts on the part of any of the parties to such
Contracts. None of the Material Contracts include provisions requiring consent
to a change of control of the Company.
(b) There are no current or pending negotiations with respect to the
renewal, repudiation or amendment of any such Material Contract.
4.2.24 LITIGATION - There is no suit, action, litigation, investigation,
----------
claim, complaint, grievance or proceeding, including appeals and applications
for review, in progress, or, to the knowledge of the Vendors, pending or
threatened against or relating to Acquired Corporations before any court,
Governmental Authority, commission, board, bureau, agency or arbitration panel.
The Vendors have no knowledge of any existing ground on which any such action,
suit, litigation or proceeding might be commenced with any reasonable likelihood
of success. There is not presently outstanding against Acquired Corporations any
judgment, decree, injunction, rule or order of any court, Governmental
Authority, commission, board, bureau, agency or arbitrator.
4.2.25 TAX MATTERS -
------------
(a) The Acquired Corporations have duly and timely filed their respective
Tax Returns with the appropriate Governmental Authority and have duly,
completely and correctly reported all income and all other amounts and
information required to be reported thereon.
(b) The Acquired Corporations have duly and timely paid all Taxes, including
all installments on account of Taxes for the current year that are due and
payable by any of them and the Acquired Corporations have established reserves
that are reflected on the Balance Sheet that are adequate for the payment by
them of all Taxes that are not yet due and payable (and that will not be due and
payable by the Closing Date) and that relate to periods ending on or prior to
Closing Date.
(c) The Acquired Corporations have not requested, or entered into any
agreement or other arrangement or executed any waiver providing for, any
extension of time within which (i) to file any Tax Return covering any Taxes for
which any of the Acquired Corporations are or may be liable; (ii) to file any
elections, designations or similar things relating to Taxes for which any of the
Acquired Corporations are or may be liable; (iii) any of the Acquired
Corporations are required to pay or remit any Taxes or amounts on account of
Taxes; or (iv) any Governmental Authority may assess or collect Taxes for which
any of the Acquired Corporations are or may be liable.
(d) The Canadian federal and provincial income and capital tax liabilities
of the Acquired Corporations have been assessed by the relevant taxing
authorities and notices of assessment have been issued to the Acquired
Corporations by the relevant taxing authorities for all taxation years prior to
and including the taxation year ended March 31st, 1999.
(e) There are no actions, suits, proceedings, investigations, audits or
claims now pending or, to the knowledge of the Vendors, threatened, against the
Acquired Corporations in respect of any Taxes and there are no matters under
discussion, audit or appeal with any Governmental Authority relating to Taxes.
The Vendors hereby jointly and severally agree to forthwith pay the full amount
of any reassessment against Javanaise Co. arising out of events which occurred
before the Closing Date. Bergeron and Julien hereby jointly and severally agree
to forthwith pay the full amount of any reassessment against Bergeron Co.
arising out of events which occurred before Closing Date.
(f) The Acquired Corporations have duly and timely withheld from any amount
paid or credited by it to or for the account or benefit of any Person,
including, without limitation, any of their respective employees, officers and
directors and any non-resident Person, the amount of all Taxes and other
deductions required by any applicable Law, to be withheld from any such amount
and has duly and timely remitted the same to the appropriate Governmental
Authority.
(g) The Acquired Corporations have not acquired property from or disposed of
property to a Person with whom it does not deal at arm's length for purposes of
the Income Tax Act (Canada) for proceeds of disposition which are greater or
less than the fair market value of the property acquired or disposed.
4.2.26 BOOKS AND RECORDS - All Books and Records of the Acquired
-------------------
Corporations have been delivered or made available to the Purchaser. Such Books
and Records fairly and correctly set out and disclose in all material respects
the financial position of the Acquired Corporations and all financial
transactions of the Acquired Corporations have been accurately recorded in such
Books and Records.
4.2.27 CORPORATE RECORDS AND MINUTE BOOKS - The corporate records and minute
----------------------------------
books of the Acquired Corporations have been delivered or made available to the
Purchaser. The articles and by-laws are in full force and effect and no
amendments have been made to the same. The minute books, including the articles
and by-laws of the Acquired Corporations, include complete and accurate minutes
of all meetings of the directors or shareholders of the Acquired Corporations,
as applicable, held to date or resolutions passed by the directors or
shareholders on consent, since the date of incorporation of the Acquired
Corporations. The share certificate book, register of shareholders, register of
transfers and register of directors of the Acquired Corporations, are complete
and accurate.
4.2.28 BANK ACCOUNTS, ETC. - Javanaise Co. has only one bank account opened
--------------------
and maintained with MBANX (branch located at 55 Bloor Street West, 19th Floor,
BMTT, Toronto, Ontario, M4W 3N5), which account bears number "MBXCPPME1612-381".
4.2.29 NO ASSOCIATED/RELATED COMPANIES - No companies are or have been
---------------------------------
associated with or related to the Acquired Corporations for purposes of the
Income Tax Act (Canada) or corresponding provincial tax legislation.
4.2.30 NON-ARM'S LENGTH TRANSACTIONS -
-------------------------------
(a) The Acquired Corporations have not since the date of the Balance Sheets,
made any payment or loan to, or borrowed any moneys from or is otherwise
indebted to, any officer, director, employee, shareholder or any other person
not dealing at arm's length with any of the Acquired Corporations, except for
usual employee reimbursements and compensation paid in the ordinary and normal
course of business;
(b) Save and except for consulting agreement with Martin Co. which shall
terminate upon Closing Date, the Acquired Corporations are not a party to any
Contract with any officer, director, employee, shareholder or any other person
not dealing at arm's length with any of the Acquired Corporations;
(c) Save and except for consulting agreement with Martin Co. which shall
terminate upon Closing Date, no officer, director or shareholder of the Acquired
Corporations and no entity which is an affiliate or associate of one or more of
such individuals: (i) owns, directly or indirectly, any interest in (except for
shares representing less than one percent of the outstanding shares of any class
or series of any publicly traded company), or is an officer, director, employee
or consultant of, any person which is, or is engaged in business as, a
competitor of Javanaise Co. or a lessor, lessee, supplier, distributor, sales
agent or customer of Javanaise Co.; (ii) owns, directly or indirectly, in whole
or in part, any property that Javanaise Co. uses in the operation of its
business; or (iii) has any cause of action or other claim whatsoever against, or
owes any amount to, the Acquired Corporations, except for any liabilities
reflected in the Interim Financial Statements and claims in the ordinary and
normal course of business such as for accrued vacation pay and accrued benefits
for employees.
4.2.31 FULL DISCLOSURE - All information, which has been provided to the
----------------
Purchaser is true and correct in all material respects and no material fact or
facts have been omitted therefrom which would make such information misleading.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
-----------------------------------------------
The Purchaser hereby represents and warrants to the Vendors the
matters set out below.
5.1 INCORPORATION - The Purchaser is a corporation duly incorporated and
-------------
validly existing under the laws of Nevada, U.S.A.
5.2 ENFORCEABILITY OF OBLIGATIONS - This Agreement has been duly authorized,
-----------------------------
executed and delivered by the Purchaser and constitutes a valid and binding
obligation of the Purchaser enforceable against it in accordance with its terms.
5.3 ABSENCE OF CONFLICTING AGREEMENTS - The Purchaser is not a party to,
------------------------------------
bound or affected by or subject to any indenture, mortgage, lease, agreement,
obligation, instrument, charter or bylaw provision, statute, regulation, order,
judgement, decree, license, permit or law which would be violated, contravened
or breached by, or under which any default would occur or a lien, claim,
restriction or encumbrance would be created as a result of the execution and
delivery by it of this Agreement or the performance by it of any of the terms of
this Agreement.
5.4 LITIGATION - There is no suit, action, litigation, investigation, claim,
----------
complaint or proceeding before any Governmental Authority in progress or, to the
knowledge of the Purchaser, pending or threatened against or relating to the
Purchaser, which, if determined adversely to the Purchaser, would, prevent the
Purchaser from fulfilling any of its obligations set out in, arising from or in
connection with this Agreement, and the Purchaser has no knowledge of any
existing ground on which any such action, suit, litigation or proceeding might
be commenced with any reasonable likelihood of success.
5.5 AUTHORIZED CAPITAL OF THE PURCHASER - The authorized capital of the
---------------------------------------
Purchaser is accurately set out in Schedule 5.5 and all of the Exchanged Shares
have been duly issued and are outstanding as fully paid and non-assessable.
5.6 TITLE TO EXCHANGED SHARES - Subject to the terms of the Escrow
----------------------------
Agreement and the restrictions set out below in Section 5.9, at their date of
issuance, all of the Exchanged Shares shall be owned by the Vendors, as the
registered and beneficial owners, with good and marketable title thereto, free
and clear of all liens, hypothecs, pledges and prior claims.
5.7 NO AGREEMENTS, OPTIONS, ETC - No person, partnership, association, firm,
---------------------------
corporation or other entity has any written or oral agreement, option,
understanding or commitment for the purchase of any of the Exchanged Shares.
5.8 NO SUBSCRIPTION RIGHTS - No person, partnership, association, firm,
------------------------
corporation or other entity has any written or oral agreement, option,
understanding or commitment, including without limitations convertible
securities, warrants or convertible obligations of any nature, for the purchase,
subscription, allotment or issuance of any of the Exchanged Shares.
5.9 REGISTRATION AND DISPOSITION OF EXCHANGED SHARES - The Exchanged Shares
------------------------------------------------
to be issued pursuant to Section 3.1(b) of this Agreement have not been
registered under the U.S. Securities Act of 1933, as amended (the "Act"), and
may not be offered, sold or otherwise transferred unless such securities are
included in an effective registration statement under the Act or an opinion of
U.S. counsel concurred in by counsel to the Purchaser has been delivered to the
effect that registration of such securities is not required based upon
applicable exemption from registration. Such an exemption, by way of example
only, may be available under rule 144 of the Act, which requires, among other
things, that the securities be owned and fully paid for a minimum of one (1)
year prior to sale, that such sales be effected through a registered
broker/dealer and that there be current public information, regarding the
issued, available to the public. This is a summary of the requirements of that
rule and is not intended to be a complete statement of its requirements.
5.10 TAXES - The Purchaser has duly filed all tax returns required to be
-----
filed by it and has paid all taxes which are due and payable, including but not
limited to income taxes, goods and services taxes, provincial or state sales
taxes, payroll taxes, workman's compensation and all deductions required at
source, and has paid all assessments and reassessments, and all other Taxes,
dues, governmental charges, penalties, interest and fines due and payable by it.
5.11 RESIDENCY - The Purchaser is not a resident of Canada within the
---------
meaning of the Income Tax Act (Canada) and the Taxation Act (Quebec).
5.12 NON-VIOLATION - The entering into of this Agreement and the
-------------
performance by the Purchaser of the transactions contemplated under and pursuant
to this Agreement does not and will not i) conflict with, result in a breach of
the terms, conditions, or provisions of, or constitute a default under the
articles or by-laws of the Purchaser or any agreement, written or oral, to which
the Purchaser of any of its affiliates are subject, or ii) violate any laws or
regulations applicable to the Purchaser including the Securities Act (Quebec),
or iii) require any consent or other action by any administrative or
governmental body, including, without limiting the foregoing, the Commission des
valeurs mobilieres du Quebec or any securities exchange commission.
ARTICLE 6
NON-WAIVER; SURVIVAL
--------------------
6.1 NON-WAIVER - No investigations made by or on behalf of the Purchaser at
----------
any time shall have the effect of waiving, diminishing the scope of or otherwise
affecting any representation or warranty made by the Vendors in or pursuant to
this Agreement. No waiver of any condition or other provision, in whole or in
part, shall constitute a waiver of any other condition or provision (whether or
not similar) nor shall such waiver constitute a continuing waiver unless
otherwise expressly provided.
6.2 NATURE AND SURVIVAL - All representations, warranties and covenants
---------------------
contained in this Agreement on the part of each of the parties shall survive the
Closing, the execution and delivery under this Agreement of any share or
security transfer instruments or other documents of title to any of the
Purchased Shares, except that:
(a) any claim for intentional misrepresentation or fraud may be brought at
any time;
(b) the representations and warranties set out in Sections 4.1.1(a),
4.1.2(a) and 5.6 shall survive and continue in full force and effect without
limitation of time;
(c) representations and warranties concerning Tax matters shall survive for
a period of ninety days after the relevant authorities shall no longer be
entitled to assess liability for Tax against the Acquired Corporations or the
Purchaser as the case may be for any particular taxation year ended on or prior
to the Closing Date; and
(d) all other representations and warranties shall survive for a period of
three (3) years from the Closing Date.
ARTICLE 7
PURCHASER'S CONDITIONS PRECEDENT
--------------------------------
The obligation of the Purchaser to complete the purchase of the
Purchased Shares under this Agreement shall be subject to the satisfaction of,
or compliance with, at or before the Closing Time, each of the following
conditions precedent (each of which is acknowledged to be inserted for the
exclusive benefit of the Purchaser and may be waived, in writing or verbally, by
the Purchaser in whole or in part):
7.1 TRUTH AND ACCURACY OF REPRESENTATIONS CONCERNING THE VENDORS AND THE
------------------------------------------------------------------------
ACQUIRED CORPORATIONS AT THE CLOSING TIME - All of the representations and
-------------------------------------------
warranties concerning the Vendors and the Acquired Corporations made in or
--
pursuant to this Agreement shall be true and correct as at the Closing Time and
--
with the same effect as if made at and as of the Closing Time.
7.2 PERFORMANCE OF OBLIGATIONS - The Vendors shall have performed or
----------------------------
complied with, in all respects, their respective obligations, covenants and
agreements under this Agreement.
7.3 RECEIPT OF CLOSING DOCUMENTATION - All documentation relating to the due
--------------------------------
authorization and completion of the sale and purchase of the Purchased Shares
under this Agreement and all actions and proceedings taken on or prior to the
Closing in connection with the performance by the Vendors of their respective
obligations under this Agreement, shall be satisfactory to the Purchaser, acting
reasonably, and the Purchaser shall have received copies of all such
documentation or other evidence as it may reasonably request in order to
establish the consummation of the transactions contemplated hereby and the
taking of all corporate proceedings in connection therewith in compliance with
these conditions, in form (as to certification and otherwise) and substance
satisfactory to the Purchaser acting reasonably.
7.4 CONSENTS, AUTHORIZATIONS AND REGISTRATIONS - All consents, approvals,
---------------------------------------------
orders and authorizations of any Person or Governmental Authority (or
registrations, declarations, filings or recordings with any such authorities),
on the part of the Vendors required in connection with the completion of any of
the transactions contemplated by this Agreement, the execution of this
Agreement, the Closing or the performance of any of the terms and conditions of
this Agreement, shall have been obtained at or before the Closing Time.
7.5 AB EMPLOYMENT AGREEMENT - Bergeron shall have entered into AB
-------------------------
Employment Agreement.
7.6 CONSULTING AGREEMENT - Louis Martin Conseils Inc. shall have entered
---------------------
into the Consulting Agreement.
7.7 RESIGNATIONS AND RELEASES - There shall have been delivered to the
---------------------------
Purchaser on or before the Closing Time the resignations of all individuals who
are presently directors or officers of the Acquired Corporations from all
offices and positions with the Acquired Corporations and from Bergeron as an
employee of Javanaise Co. and duly executed comprehensive releases in form and
substance satisfactory to the Purchaser from the Vendors of all their claims,
respectively, against the Acquired Corporations.
7.8 TERMINATION OF SHAREHOLDERS AGREEMENT - The Shareholders Agreement shall
-------------------------------------
have been terminated and the Acquired Corporations shall have been released from
all liability thereunder.
7.9 ESCROW AGREEMENT - The Vendors shall have executed and delivered the
-----------------
Escrow Agreement.
ARTICLE 8
VENDORS' CONDITIONS PRECEDENT
-----------------------------
The obligations of the Vendors to complete the sale of the Purchased
Shares under this Agreement shall be subject to the satisfaction of or
compliance with, at or before the Closing Time, each of the following conditions
precedent (each of which is acknowledged to be inserted for the exclusive
benefit of the Vendors and may be waived, in writing or verbally, by them in
whole or in part).
8.1 TRUTH AND ACCURACY OF REPRESENTATIONS OF THE PURCHASER AT CLOSING TIME -
----------------------------------------------------------------------
All of the representations and warranties of the Purchaser made in or pursuant
to this Agreement shall be true and correct as at the Closing Time and with the
same effect as if made at and as of the Closing Time and the Vendors shall have
received a certificate from a senior officer of the Purchaser confirming the
truth and correctness of such representations and warranties.
8.2 PERFORMANCE OF OBLIGATIONS - The Purchaser shall have performed or
----------------------------
complied with, in all respects, all its obligations, covenants and agreements
under this Agreement.
8.3 AB EMPLOYMENT AGREEMENT AND CONSULTING AGREEMENT - iVision Integral Inc.
------------------------------------------------
shall have entered into the AB Employment Agreement and Consulting Agreement.
8.4 PERSONAL GUARANTY - Bergeron and Louis Martin shall have been released
-----------------
from their personal guaranties granted to MBANX with respect to Javanaise Co.
8.5 RECEIPT OF CLOSING DOCUMENTATION - All documentation relating to the
-----------------------------------
due authorization and completion of the sale and purchase of the Purchased
shares under this Agreement and all actions and proceedings taken on or prior to
the closing in connection with the performance by the Purchaser of its
obligations under this Agreement, shall be satisfactory to the Vendors, acting
reasonably, and the Vendors shall have received copies of all such documentation
or other evidence as they may reasonably request in order to establish the
consummation of the transactions contemplated hereby and the taking of all
corporate proceedings in connection therewith in compliance with these
conditions, in form (as to certification and otherwise) and substance
satisfactory to the Vendors acting reasonably.
8.6 CONSENTS, AUTHORIZATIONS AND REGISTRATIONS - All consents, approvals,
--------------------------------------------
orders and authorizations of any Person or Governmental Authority (or
registrations, declarations, filings of recordings with any such authorities) on
the part of Purchaser, required in connection with the completion of any of the
transactions contemplated by this Agreement, the execution of this Agreement,
the closing or the performance of any of the terms and conditions of this
Agreement, shall have been obtained at or before the Closing Time.
8.7 ESCROW AGREEMENT - Purchaser shall have executed and delivered the
-----------------
Escrow Agreement.
ARTICLE 9
OTHER COVENANTS OF THE PARTIES
------------------------------
9.1 ACTIONS TO SATISFY CLOSING CONDITIONS - Each of the parties agrees to
----------------------------------------
take all such actions as are within its power to control, and to use all
reasonable efforts to cause other actions to be taken which are not within its
power to control, so as to ensure compliance with each of the conditions and
covenants set forth in Articles 7, 8 or 9 which are for the benefit of any other
Party.
9.2 CONSENT TO JURISDICTION - Each of the parties irrevocably attorns and
-------------------------
submits to the exclusive jurisdiction of any Quebec court sitting in Montreal in
any action or proceeding arising out of or related to this Agreement and
irrevocably agrees that all claims in respect of any such action or proceeding
shall be heard and determined in such Quebec court. Each of the parties
irrevocably waives, to the fullest extent possible, the defense of an
inconvenient forum to the maintenance of such action or proceeding.
9.3 BERGERON CO. TAX - The Purchaser undertake to reimburse to Bergeron,
------------------
upon receipt, on behalf of Bergeron Co. from any Federal or provincial Tax
Authorities, of any amount or refund in respect of any period ending on or
before the Closing Date.
ARTICLE 10
INDEMNIFICATION
---------------
10.1 INDEMNIFICATION BY THE VENDORS -
---------------------------------
10.1.1 INDEMNIFICATION BY MARTIN CO. - Martin Co. agrees to indemnify and
-------------------------------
save harmless the Purchaser and Javanaise Co. on an after-tax basis as well as
the directors and officers of Javanaise Co. against all Losses suffered or
incurred as a result of or arising directly or indirectly out of or in
connection with any breach by Martin Co of or any inaccuracy of any of the
representations and warranties of Martin Co., other than those referred to in
10.1.3, set out in this Agreement or any breach or non-performance by Martin Co.
of any covenant, other than those referred to in 10.1.3, to be performed by it
under this Agreement or any agreement, instrument, certificate or other document
delivered pursuant hereto.
10.1.2 INDEMNIFICATION BY BERGERON AND JULIEN - Bergeron and Julien agree
----------------------------------------
to jointly and severally indemnify and save harmless the Purchaser and the
Acquired Corporations on an after-tax basis as well as the directors and
officers of the Acquired Corporations against all Losses suffered or incurred as
a result of or arising directly or indirectly out of or in connection with any
breach by either Bergeron or Julien of or any inaccuracy of any of the
representations and warranties of Bergeron and Julien, other than those referred
to in 10.1.3, set out in this Agreement or any breach or non-performance by
either of them of any covenant, other than those referred to in 10.1.3, to be
performed by them under this Agreement or any agreement, instrument, certificate
or other document delivered pursuant hereto.
10.1.3 INDEMNIFICATION BY THE VENDORS - Each of the Vendors agree to
---------------------------------
jointly and severally indemnify and save harmless the Purchaser and Javanaise
Co. on an after-tax basis as well as the directors and officers of Javanaise Co.
against all Losses suffered or incurred as a result of or arising directly or
indirectly out of or in connection with any breach by the Vendors of or any
inaccuracy of any of the representations and warranties of the Vendors made by
the Vendors on a joint and several basis under this Agreement or any breach or
non-performance by the Vendors of any covenant to be performed by the Vendors on
a joint and several basis under this Agreement or any agreement, instrument,
certificate or other document delivered pursuant hereto.
10.2 INDEMNIFICATION BY THE PURCHASER - The Purchaser agrees to indemnify
-----------------------------------
and save harmless the Vendors on an after-tax basis from all Losses suffered or
incurred by the Vendors as a result of or arising directly or indirectly out of
or in connection with:
(a) any breach by the Purchaser of or any inaccuracy of any representation
or warranty of the Purchaser in this Agreement or in any agreement, instrument,
certificate or other document delivered pursuant hereto; and
(b) any breach or non-performance by the Purchaser of any covenant to be
performed by it under this Agreement or under any agreement, instrument,
certificate or other document delivered pursuant hereto.
10.3 NOTIFICATION OF AND PARTICIPATION IN CLAIMS - No Claim will arise until
-------------------------------------------
notice thereof is given to the party (the INDEMNITOR ) from whom indemnity is
sought. Such notice shall be sent within a reasonable time following the
determination by a party (the CLAIMANT ) that a Claim for indemnity exists. In
the event that any legal proceedings shall be instituted or any Claim or demand
is asserted by any third party in respect of which the Indemnitor may have an
obligation to indemnify the Claimant, the Claimant shall give or cause to be
given to the Indemnitor written notice thereof and the Indemnitor shall have the
right, at its option and expense, to be present at the defense of such
proceedings, claim or demand, but not to control the defense, negotiation or
settlement thereof, which control shall at all times rest with the Claimant,
unless the Indemnitor irrevocably acknowledges full and complete responsibility
for indemnification of Claimant, in which case the Indemnitor may assume such
control through counsel of its choice, provided however, that no settlement
shall be entered into without the Claimant's written consent (which shall not be
unreasonably withheld). The parties hereto agree to cooperate fully with each
other in connection with the defense, negotiation or settlement of any such
third party legal proceeding, claim or demand.
10.4 MISCELLANEOUS - Notwithstanding anything in this Agreement to the
-------------
contrary, the indemnity provided for in this Article 10 shall apply to any loss,
liability, damage, deficiency or expense, whether or not the actual amount
thereof shall have been ascertained prior to the final day upon which a Claim
for indemnity with respect thereto may be made hereunder, so long as written
notice thereof shall have been given to the Indemnitor prior to said date,
setting forth specifically and in reasonable detail, so far as is known, the
matter as to which indemnification is being sought, but nothing herein shall be
construed to require payment of any claim for indemnity until the actual amount
payable shall have been finally ascertained. In addition, any Claims for
damages payable hereunder shall be adjusted, in accordance with Canadian
generally accepted accounting principles, to reflect the after-tax effect
thereof.
10.5 RESTRICTIONS AND LIMITATIONS -
------------------------------
10.5.1 DEDUCTIBLE -
----------
(a) Notwithstanding any other provisions of this Agreement, the Vendors
shall have not liability to the Purchaser in respect of Losses except if and to
the extent that the aggregate of such Losses for the Purchaser and the Acquired
corporations shall exceed $5,000.00 However, the foregoing shall not relieve
Purchaser of its obligations to notify under Section 10.3.
(b) Notwithstanding any other provisions of this Agreement, the Purchaser
shall have no liability to the Vendors in respect of Losses except if and to the
extent that the aggregate of such Losses for the Vendors collectively shall
exceed $5,000.00 However, the foregoing shall not relieve Vendors of their
obligations to notify under Section 10.3.
10.5.2 LIABILITY CAP - Notwithstanding any other provisions of this
--------------
Agreement, each of the Vendors shall have no liability to the Purchaser in
respect of Losses in excess of the portion of the Purchase Price paid to such
Vendor.
10.5.3 INDIRECT DAMAGES - Notwithstanding any other provisions of this
-----------------
Agreement, none of the Vendors shall be liable to the Purchaser for any indirect
or consequential damages. Notwithstanding any other provisions of this
Agreement, Purchaser shall not be liable to the Vendors for any indirect or
consequential damages.
10.5.4 REDUCTION OF LOSSES - The amount of Losses payable by the Vendors
---------------------
shall be reduced by the aggregate amount of:
(a) any insurance proceeds received by the Purchaser or by the Acquired
Corporations or a successor corporations, for and in relation to those Losses,
subject to such reduction not resulting in a loss of coverage or reduction of
the insurance proceeds received or to be received by the Purchaser or the
Acquired Corporations (or a successor corporation) or increase of future
insurance premiums which are attributable to such Losses. If insurance proceeds
for Losses are received by the Purchase or by the Acquired corporations or a
successor corporation after the Vendors have performed their obligations to
indemnify under this Agreement in connection with such Losses, then the
Purchaser or the Acquired Corporations or a successor corporation, as the case
may be, shall remit to the Vendors the amount of such insurance proceeds;
(b) any reduction in Taxes otherwise payable by the Acquired Corporations or
a successor corporation arising from or relating to the Loss.
Where all or part of the Loss generates a reduction in Taxes the amount of
the reduction in Taxes shall reduce the Loss by an equal amount.
ARTICLE 11
PROCEDURES AT CLOSING
11. DELIVERY OF CLOSING DOCUMENTS - At Closing, the following shall occur:
-----------------------------
a) The Vendors shall:
(i) deliver to the Purchaser certificates respecting all of the Purchased
shares duly endorsed in blank for transfer;
(ii) cause the transfer of the Purchased shares to be duly registered and
regularly recorded in the name of the Purchaser in the books and
corporate records of the Acquired Corporations;
(iii) deliver to the Purchaser certificates respecting all of the issued
shares of the Acquired Corporations;
(iv) deliver to the Purchaser the minute books and corporate records of the
Acquired Corporations;
(v) deliver to the Purchaser the Consulting Agreement duly executed by Louis
Martin Conseils Inc.;
(vi) deliver to the Purchaser the AB Employment Agreement duly executed by
Bergeron;
(vii) deliver to the Purchaser a non-competition agreement and a
non-disclosure agreement duly executed by Martin Co.;
(viii) deliver to the Purchaser a non-competition agreement and a
non-disclosure agreement duly executed by Bergeron;
(ix) deliver to the Purchaser duly certified copies of resolutions of the
directors of the Acquired Corporations authorizing the transfer of the
Purchased Shares to the Purchaser and of resolutions of the
director and shareholder of Martin Co. authorizing the sale of
shares of Javanaise Co. to the Purchaser;
(x) execute receipts with respect to the payments received;
(xi) deliver to the Purchaser the Escrow Agreement duly executed by the
Vendors;
(xii) Deliver releases in favor of the Acquired Corporations.
(b) The Purchaser shall:
(i) deliver cheques to the Vendors as provided for in Section 3.2 hereof;
(ii) deliver to the Vendors share certificates respecting all of the
Exchanged Shares issued at Closing;
(iii) deliver a certified copy of resolutions of the Board of Directors of
the Purchaser and iVision Integral Inc. authorizing the transactions
herein;
(iv) deliver to the Vendors the Consulting Agreement duly executed by
iVision Integral Inc.;
(v) deliver to the Vendors the AB Employment Agreement duly executed by
iVision Integral Inc.; and
(vi) deliver to the Vendors the Escrow Agreement duly executed by the
Purchaser.
ARTICLE 12
GENERAL
- -------
12.1 PUBLIC NOTICES - All public notices to third parties and all other
---------------
publicity concerning the transactions contemplated by this Agreement shall be
jointly planned and coordinated by the Vendors and the Purchaser and no Party
shall act unilaterally in this regard without the prior approval of the other
Party, such approval not to be unreasonably withheld, except where required to
do so by law or by the applicable regulations or policies of any provincial or
Canadian or other regulatory agency of competent jurisdiction or any stock
exchange in circumstances where prior consultation with the other Party is not
practicable.
12.2 EXPENSES - The Vendors and the Purchaser shall pay their respective
--------
legal, accounting, and other professional advisory fees, costs and expenses
incurred in connection with the purchase and sale of the Purchased Shares and
the preparation, execution and delivery of this Agreement and all documents and
instruments executed pursuant to this Agreement and any other costs and expenses
incurred by the Party.
12.3 NOTICES - Any notice or other writing required or permitted to be given
-------
under this Agreement or for the purposes of this Agreement (in this Section
referred to as a Notice ) shall be in writing and shall be sufficiently given
if delivered, or if transmitted by facsimile or other form of recorded
communication tested prior to transmission to such Party:
(a) in the case of a Notice to the Vendors:
Bergeron and Julien
c/o Alain Bergeron
8460 Ouimet Street
Brossard (Quebec) J4Y 3B5
Martin Co.
c/o Louis Martin
320 Victoria Avenue # 403
St-Lambert (Quebec) J4P 2H8
(b) in the case of a Notice to the Purchaser at:
iVision Integral Inc.
c/o Philippe Racine
1 Westmount Square # 650
Westmount (Quebec) H3Z 2P9
or at such other address as the Party to whom such Notice is to be given shall
have last notified the Party giving the same in the manner provided in this
Section. Any Notice delivered to the Party to whom it is addressed as provided
above shall be deemed to have been given and received on the day it is so
delivered at such address, provided that if such day is not a Business Day then
the Notice shall be deemed to have been given and received on the next Business
Day. Any Notice transmitted by facsimile or other form of recorded communication
shall be deemed given and received on the first Business Day after its
transmission.
12.4 ASSIGNMENT - Neither this Agreement nor any benefits or burdens under
----------
this Agreement shall be assignable by any Party without the prior written
consent of each of the other parties. Subject to the foregoing, this Agreement
shall enure to the benefit of and be binding upon the parties and their
respective heirs, executors, legal representatives, successors (including any
successor by reason of amalgamation of any Party) and permitted assigns.
12.5 FURTHER ASSURANCES - The parties shall, with reasonable diligence, do
-------------------
all such things and provide all such reasonable assurances as may be required to
consummate the transactions contemplated by this Agreement, and each Party shall
provide such further documents or instruments required by any other Party as may
be reasonably necessary or desirable to effect the purpose of this Agreement and
carry out its provisions, whether before or after the Closing.
12.6 REMEDIES CUMULATIVE - Except as otherwise herein expressly provided,
--------------------
the rights and remedies of the parties under this Agreement are cumulative and
in addition to and not in substitution for any rights or remedies provided by
law. Any single or partial exercise by any party hereto of any right or remedy
for default or breach of any term, covenant or condition of this Agreement does
not waive, alter, affect or prejudice any other right or remedy to which such
party may be lawfully entitled for the same default or breach.
12.7 LANGUAGE - The parties declare that they have requested and do hereby
--------
confirm their request that this Agreement be drawn up in English; les parties
declarent qu'elles ont exige et par les presentes confirment leur demande que ce
contrat soit redige en anglais.
12.8 COUNTERPARTS AND FACSIMILE - This Agreement may be executed by the
----------------------------
parties in separate counterparts and by facsimile each of which when so executed
and delivered shall be an original, but all such counterparts shall together
constitute one and the same instrument.
IN WITNESS WHEREOF the parties have duly executed this Agreement at the
place and date herein-above mentioned.
IVISION GROUP LTD. LA SOCIETE DE GESTION LOUIS
MARTIN INC.
Per: /s/ Philippe Racine Per: /s/ Louis Martin
____________________ _____________________
Philippe Racine Louis Martin
ALAIN BERGERON HELENE JULIEN
/s/ Alain Bergeron /s/ Helene Julien
__________________________ ___________________________
[LETTERHEAD ANDERSEN ANDERSEN & STRONG]
Engle Mining Co., Inc.
We hereby consent to the use of our report dated April 10, 1999, for the period
ended December 31, 1998 in the registration statement of Engle Mining Co., Inc.
filed in the form 10-SB in accordance with Section 12 of the Securities Exchange
Act of 1934.
/s/ ANDERSEN ANDERSEN & STRONG
November 4, 1999
Salt Lake City, Utah
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