10QSB: Optional form for quarterly and transition reports of small business issuers
Published on June 6, 2002
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One) [X] Quarterly report under Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the quarterly period ended March 31, 2002.
[ ] Transition report under Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the transition period from ______ to ______ .
Commission file number: 000-27407
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DELTA CAPITAL TECHNOLOGIES, INC.
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(Exact name of small business issuer as specified in its charter)
Delaware 98-0187705
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Suite 205, 5550-14B Avenue, Delta, B.C., Canada V4M 2G6
---------------------------------------------------------
(Address of principal executive office) (Zip Code)
(604) 943-6422
(Issuer's telephone number)
Check whether the issuer: (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
Yes XX No
-- -----
The number of outstanding shares of the issuer's common stock, $0.001 par value
(the only class of voting stock), as of June 6, 2002, was 3,603,809
1
TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.................................................3
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS.................................4
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS....................................................5
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS............................5
ITEM 5. OTHER INFORMATION....................................................6
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.....................................6
SIGNATURES....................................................................7
INDEX TO EXHIBITS.............................................................8
[THIS SPACE HAS BEEN INTENTIONALLY LEFT BLANK]
2
ITEM 1. FINANCIAL STATEMENTS
As used herein, the term "Company" refers to Delta Capital Technologies, Inc.,
a Delaware corporation and predecessors unless otherwise indicated. Unaudited,
condensed interim financial statements including a balance sheet for the Company
as of the quarter ended March 31, 2002, and statements of operations, and
statements of cash flows for the interim period up to the date of such balance
sheet and the comparable period of the preceding year are attached hereto as
Pages F-1 through F- 7 and are incorporated herein by this reference.
[THIS SPACE HAS BEEN LEFT BLANK INTENTIONALLY.]
3
INDEX TO FINANCIAL STATEMENTS
PAGE
Balance Sheet...............................................................F-2
Statement of Operations.....................................................F-3
Statement of Changes in Stockholders' Equity................................F-4
Statement of Cash Flows.....................................................F-5
Notes to Unaudited Financial Statements..................................F-6-F7
F-1
DELTA CAPITAL TECHNOLOGIES, INC.
(A Development Stage Company)
CONSOLIDATED BALANCE SHEETS
MARCH 31, 2002 AND DECEMBER 31, 2001
UNAUDITED
The accompanying notes are an integral part of these financial statements
F-2
DELTA CAPITAL TECHNOLOGIES, INC.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three Months Ended March 31, 2002 and 2001
and the Period from March 4, 1998 (Date of Incorporation) to
March 31, 2002
(Unaudited)
The accompanying notes are an integral part of these financial statements
F-3
DELTA CAPITAL TECHNOLOGIES, INC.
(A Development Stage Company)
CONSOLIDATED STATEMENT OF CHANGES IN
STOCKHOLDERS' EQUITY For the period from March 4,
1998 (Date of Incorporation) to March 31, 2002
The accompanying notes are an integral part of
these financial statements.
F-4
DELTA CAPITAL TECHNOLOGIES, INC.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Three Months Ended March 31, 2002 and 2001 and
the Period from
March 4, 1998 (Date of Incorporation) to March 31, 2002 (Unaudited)
F-5
The accompanying notes are an integral part of these financial statements
DELTA CAPITAL TECHNOLOGIES, INC.
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the Three Months Ended March 31, 2002
(Unaudited)
Note 1. Basis of Presentation
The interim period consolidated financial statements contained herein include
the accounts of Delta Capital Technologies, Inc. and it's subsidiary (the
"Company").
The interim period consolidated financial statements have been prepared by the
Company pursuant to the rules and regulations of the U.S. Securities and
Exchange Commission (the "SEC"). Certain information and footnote disclosure
normally included in financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted pursuant to such
SEC rules and regulations. The interim period consolidated financial statements
should be read together with the audited consolidated financial statements and
accompanying notes included in the Company's latest annual report on Form 10-KSB
for the fiscal year ended December 31, 2001. In the opinion of the Company, the
unaudited consolidated financial statements contained herein contain all
adjustments necessary to present a fair statement of the results of the interim
periods presented.
Note 2. Summary of Significant Accounting Policies
Earnings Per Share
Basic earnings per share is computed by dividing income (loss) for the period
by the weighted average number of common shares outstanding during a period.
Diluted earnings per share takes into consideration common shares outstanding
(computed under basic earnings per share) and potentially dilutive common
shares. The weighted average number of shares was 2,278,417 and 488,344 for the
three months ended March 31, 2002 and March 31, 2001, respectively. The weighted
average number of shares was 526,239 for the period from March 4, 1998 to March
31, 2002.
Note 3. Going Concern
In the Auditors' report on the Company's financial statements as of December
31, 2001, they indicated there was substantial doubt about the Company's ability
to continue as a going concern. The Company incurred a net loss of
$7,235,901 since inception, largely due to its write-off of assets related to
its investment in its computer software. Further, the Company has net deficiency
in capital of $288,334. These factors raise concerns about the Company's ability
to continue as a going concern.
The Company will need additional working capital to be successful in any future
business activities and to service its current debt for the coming year.
Therefore, continuation of the Company as a going concern is dependent upon
obtaining the additional working capital necessary to accomplish its objective.
Management is presently engaged in seeking additional working capital equity
funding and plans to continue to invest in other businesses with funds obtained.
F-6
DELTA CAPITAL TECHNOLOGIES, INC.
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the Three Months Ended March 31, 2002
(Unaudited)
Note 3. Continued
The accompanying financial statements do not include any adjustments to the
recorded assets or liabilities that might be necessary should the Company fail
in any of the above objectives and is unable to operate for the coming year.
Note 4. Formation of Subsidiary
On February 14, 2002, the Company formed Homelands Security Inc. (Homelands), a
Nevada corporation. Homeland issued 1,000,000 shares of its common stock, with a
par value of $0.001 to the Company. Homelands only transaction within the period
was to enter into the agreement with Interglobe (note 5).
Note 5. Subsequent Event
On March 8, 2002, Homelands (note 4), agreed to purchase 100% of the outstanding
shares of stock of Interglobe Investigation Services, Inc. (Interglobe), a
British Columbia corporation, in exchange for 950,000 shares of Homelands common
stock. The closing date of the agreement was April 15, 2002. As a result of this
transaction, the Company's ownership of Homelands was reduced to 51.3%. The
results of operations of Interglobe will be included with the Company's results
of operations from the closing date forward. Interglobe was acquired because the
Company is in the process of acquiring revenue-generating businesses, which the
Company believes will be profitable in the future. Management has not determined
the amount of goodwill, if any, from this acquisition because the accounting
information as of the acquisition date has not been compiled.
F-7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
Plan of Operations
As used herein the term "Company" refers to Delta Capital Technologies, Inc., a
Delaware corporation and its predecessors, unless the context indicates
otherwise. During the quarter ended March 31, 2002, the Company had no
substantial operations. However, on March 8, 2002, the Company's majority owned
subsidiary, Homelands Security, Inc., (Homelands) entered into a Stock Purchase
and Sale Agreement to purchase 100% of Interglobe Investigation Services, Inc.'s
issued and outstanding stock. The transaction closed on April 15, 2002. The
Company's executive offices are currently located at 205-5550 14BAvenue, Delta,
B. C., Canada V4M 2G6.
The Company's plan of operations for the next 12 months will be to operate its
majority owned subsidiary, Homelands which completed its acquisition of
Interglobe Investigation Services Inc. ("Interglobe") a British Columbia
Corporation formed in 1995, which provides private investigation and security
consulting services for individuals and corporations. The acquisition of
Interglobe occurred subsequent to the end of March 31, 2002. With this
acquisition, Delta is moving towards meeting its business objectives of
obtaining operations that may allow its' subsidiary to become a pre-eminent,
full service investigation and security consulting company in North America.
The Company does not have sufficient capital to operate over the next fiscal
year without a substantial infusion of operating capital. It will be necessary
for the Company to either borrow funds to operate or generate operating funds
through the sale of equity in the Company or its subsidiaries. There can be no
assurance that the Company will be able to generate sufficient income from
either borrowing, the sale of equity, or a combination thereof to allow it to
operate its business during the coming year. Unless the Company is successful in
raising additional operating capital, it will not have sufficient funds to
operate during the balance of the fiscal year.
The Company has no current plans to perform any product research and development
during the coming year.
The Company has no current plans to spend any significant amount in the coming
year on plant or equipment.
At the present time, it is not anticipated that the Company will have any
significant increase in the number of employees working for the Company.
Going Concern
In the auditor's Statement of Financial Operations for December 31, 2001, they
have expressed an opinion as to the Company's ability to continue as a going
concern. The Company's ability to continue as a going concern is subject to the
ability of the Company to obtain a profit and/or obtaining the necessary funding
from outside sources. Management's plan to address the Company's ability to
continue as a going concern, includes: (1) obtaining funding from the sale of
the Company's securities; (2) increasing sales of their subsidiary Homelands and
Interglobe, and (3) obtaining loans from various financial institutions where
possible. Although management believes that it will be able to obtain the
necessary funding to allow the Company to remain a going concern through the
methods discussed above, there can be no assurances that such methods will prove
successful.
4
PART II-OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
No material developments occurred during the quarter ended March 31, 2002, with
respect to pending litigation. For more information on legal proceedings, see
the Company's Form 10KSB for the year ended December 31, 2001.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
On January 8, 2002, the Company issued 134,039 shares of its common stock as
settlement for debt in the amount of $13,403.85 to Bayside Management
Corporation a British Columbia company pursuant to Regulations S of the
Securities Act of 1933.
On January 9, 2002, the Company issued 718,127 shares of its common stock to
creditors as settlement for debt in the amount of $71,813. The creditors include
three British Columbia companies and one resident of South Korea. The Company
issued the shares in reliance upon Regulation S of the Securities Act of 1933.
On January 10, 2002, the Company issued 250,386 shares of its common stock to
two creditors as settlement for debt in the amount of $25,386. The creditors
included a British Columbia company and a resident of Winnipeg, Manitoba.
The Company issued the shares in reliance upon Regulation S of the Securities
Act of 1933.
On February 15, 2002, the Company issued 713,000 shares of its common stock to
8 individuals, 115,000 shares for services and 598,000 shares for cash.
The individuals all reside in Ontario, Canada. The Company issued the shares
in reliance upon Regulation S of the Securities Act of 1933.
On March 7, 2002, the Company issued 100,000 shares of its common stock to each
of the following three individuals: Judy Miller and Darwyn Ross, and Martin
Tutschek for services rendered. The Company relied upon section 4(2) of the
Securities Act of 1933 in an isolated private transaction by the Company which
did not involve a public offering. The Company made this offering based on the
following factors: (1) The issuance was an isolated private transaction by the
Company which did not involve a public offering; (2) there were only three
offerees who were issued stock for consulting services; (3) the offerees did not
resell the stock but have continued to hold it since the date of issue; (4)
there were no subsequent or contemporaneous public offerings of the stock; (5)
the stock was not broken down into smaller denominations; and (6) the
negotiations for the sale of the stock took place directly between the offerees
and the Company.
On March 19, 2002, the Company authorized the cancellation of 9,000 shares of
its common stock. The 9,000 shares were cancelled as a result of rescinding a
transaction previously entered into with an individual.
On March 22, 2002, the Company issued 775,000 shares to 8 individuals.
Regulation S provides generally that any offer or sale that occurs outside of
the United States is exempt from the registration requirements of the Securities
Act of 1933, provided that certain conditions are met. Regulation S has two safe
harbors. One safe harbor applies to offers and sales by issuers, securities
professionals involved in the distribution process pursuant to contract, their
respective affiliates, and persons acting on behalf of any of the foregoing (the
"issuer safe harbor"), and the other applies to resales by persons other than
the issuer, securities professionals involved in the distribution process
pursuant to contract, their respective affiliates (except certain officers and
directors), and persons acting on behalf of any of the forgoing (the "resale
safe harbor"). An offer, sale or resale of securities that satisfied all
conditions of the applicable safe harbor is deemed to be outside the United
States as required by Regulation S. The distribution compliance period for
shares sold in reliance on Regulation S is one year.
5
The Company has complied with the requirements of Regulation S by having no
directed selling efforts made in the United States, by selling only to buyers
who were outside the United States at the time the buy orders originated,
ensuring that each person is a non-U.S. person with address in a foreign country
and having each person make representation to the Company certifying that he or
she is not a U.S. person and is not acquiring the Securities for the account or
benefit of a U.S. person other than persons who purchased Securities in
transactions exempt from the registration requirements of the Securities Act;
and also agrees only to sell the Securities in accordance with the registration
provisions of the Securities Act or an exemption therefrom, or in accordance
with the provisions of the Regulation.
ITEM 5. OTHER INFORMATION
On December 20, 2001, the board of directors of Delta Capital Technologies, Inc.
(the "Company") had unanimously agreed that it was in the best interests of the
Company's shareholders to pursue new business opportunities. The board of
directors further agreed that the Company did not have sufficient capital or a
share capital structure that would facilitate prospective business
opportunities. Therefore, the board of directors agreed to consolidate the
Company's share capital as a first step in making the Company more attractive to
potential businesses.
The Board of Directors then agreed to consolidate the Company's capital
structure on a one hundred (100) to one (1) basis reducing the Company issued
and outstanding shares as of December 20, 2001 from sixty nine million three
hundred thousand six hundred and seventy two (69,300,672) to six hundred and
ninety three thousand and seven (693,007). The effect of the capital structure
consolidation was to reduce the seventy five million (75,000,000) shares of
authorized capital to seven hundred and fifty thousand (750,000) in authorized
capital.
The Board of Directors, in reliance on shareholder action, then amended the
Company's articles of incorporation to reflect an increase in the authorized
share capital from seven hundred and fifty thousand (750,000) common shares to
twenty five million (25,000,000) common shares.
The consolidation of the Company's capital stock and the increase in the
authorized common stock was effected on January 4, 2002. The Company's new
symbol on the OTC Bulletin Board is DCTN.
In January 2002, the Company entered into a Fee Agreement with Kent Carasquero.
The Fee Agreement calls for the payment of $2,500 a month which may be paid in
the form of the Company's common stock. Mr. Carasquero will provide services
with respect to the management of the Company's account receivables, accounts
payable, acting as a liaison for the Company and other services.
Subsequent to the quarter ended March 31, 2002, Company's subsidiary Homelands
Security, Inc. (Homeland) acquired a 100% interest in Interglobe Investigation
Services, Inc. in exchange for 950,000 shares of Homeland common stock. Homeland
is now a majority owned subsidiary of the Company rather than a wholly owned
subsidiary.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits Required to be attached by Item 601 of Regulation S-B are
listed in the Index to Exhibits on page 7 of this Form 10-QSB, and are
incorporated herein by this reference.
(b) Reports on Form 8-K. On January 8, 2002, the Company filed a report on
Form 8-K which reported that the Company effected a 1 for 100 reverse
split and an increase in authorized shares.
6
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized, this 31st day of May, 2002.
Delta Capital Technologies, Inc.
/s/ Judy Miller
- ---------------------------------------------------
Judy Miller, Secretary and Director
7
INDEX TO EXHIBITS
EXHIBIT PAGE
NO. NO. DESCRIPTION
3(i) * Articles of Incorporation dated March 4, 1998.
(Incorporated by reference from Form 10SB filed
with the SEC on January 5, 2000.)
3(ii) * Amended Articles of Incorporation dated April 23,
1998. (Incorporated by reference from Form 10SB
filed with the SEC on January 5, 2000.)
3(iii) * By-Laws of Delta Capital dated April 23, 1998.
(Incorporated by reference from Form 10SB filed
with the SEC on January 5, 2000.)
MATERIAL CONTRACTS
10(i) 9 Debt Settlement Agreement dated January 8, 2002
between Delta Capital Technologies,Inc. and Bayside
Management Corp.
10(ii) 11 Debt Settlement Agreement dated January 9, 2002
between Delta Capital Technologies, Inc. and
Churchill Resource Group, Inc.
10(iii) 13 Debt Settlement Agreement dated January 9, 2002
between Delta Capital Technologies, Inc. and BP
Equity Management Corp.
10(iv) 15 Debt Settlement Agreement dated January 9, 2002
between Delta Capital Technologies, Inc. and
Jeff Young.
10(v) 17 Debt Settlement Agreement dated January 10, 2002
between Delta Capital Technologies, Inc. and
Bonanza Mgmt. LTD.
10(vi) 19 Debt Settlement Agreement dated January 10, 2002
between Delta Capital Technologies, Inc. and Peter
Kent Carasquero.
10(vii) 21 Debt Settlement Agreement dated January 10, 2002
between Delta Capital Technologies, Inc. and
Hospitality Financial Services LTD.
10(viii) 23 Fee Agreement dated January 2002 between Delta
Capital Technologies, Inc. and Kent Carasquero
10(ix) 27 Stock Purchase and Sale Agreement dated March 8,
2002 between Delta Capital Technologies, Inc. and
Homelands Security Inc.
* Incorporated by reference from previous filings as noted.
8
DEBT SETTLEMENT AGREEMENT
THIS AGREEMENT is made as of the 8th day of January 2002
BETWEEN:
DELTA CAPITAL TECHNOLOGIES INC., a Delaware company having an
office at B201, 1331 Homer Street, Vancouver, B.C. V6B 5M5
(the "Company")
OF THE FIRST PART
AND:
BAYSIDE MANAGEMENT CORP. , having an office located at suite
203-1030 West 14th Avenue Vancouver B.C.V6H 1P3
(the "Creditor")
OF THE SECOND PART
WHEREAS:
A. The Company is indebted to the Creditor in the amount of
US$13,403.85 (the "Debt");
B. The Company has agreed to issue to the Creditor 134,039
(US$13,403.85/US$0.10 per share) common shares (the "Shares") in total
satisfaction of the Debt; and
C. The Creditor has agreed to accept the Shares from the Company in
total satisfaction of the Debt.
THEREFORE, in consideration of the premises and the mutual covenants
and agreements set forth in this Agreement, the parties agree as follows:
1.00 Debt Settlement
1.01 The Company will pay and satisfy the Debt by issuing the Shares to the
Creditor at a deemed price of US$0.01 per share for an aggregate amount equal to
the Debt payable on January 10, 2002.
1.02 The Creditor acknowledges and agrees that all outstanding accounts have
been rendered by the Creditor to the Company to the date of this Agreement and
upon issuance of the Shares to the Creditor there will be no outstanding
liability of the Company to the Creditor.
2.00 Headings
2.01 The headings and section references in this Agreement are for convenience
of reference only and do not form a part of this Agreement and are not intended
to interpret, define or limit the scope, extent or intent of this Agreement or
any provision thereof.
9
3.00 Governing Law
3.01 This Agreement and all matters arising hereunder shall be governed by,
construed and enforced in accordance with the laws of the State of Delaware and
all disputes arising under this Agreement shall be referred to, and the parties
attorn to the jurisdiction of, the courts of appropriate jurisdiction in the
State of Delaware.
4.00 Enurement
4.01 This Agreement shall enure to the benefit of and be binding upon the
parties hereto and their respective successors and permitted assigns.
5.00 Carrying Out Agreement
5.01 Each of the parties hereto hereby covenants and agrees to execute such
further and other documents and instruments and do such other things as may be
necessary to implement and carry out the intent of this Agreement.
6.00 Assignment
6.01 This Agreement shall not be assignable by the Creditor without the
written consent of the Company.
7.00 Counterparts
7.01 This Agreement, or any amendment to it, may be executed in counterparts,
each of which will be deemed an original agreement and all of which will
together constitute one agreement.
8.00 Amendment
8.01 Except as herein otherwise provided, no subsequent alteration, amendment,
change or addition to this Agreement shall be binding upon the parties hereto
unless reduced to writing and signed by the parties.
IN WITNESS WHEREOF the parties hereto have executed this Agreement as
of the day and year first above written.
DELTA CAPITAL TECHNOLOGIES, INC.
Per:
/s/ Judith Miller
----------------------------------------------------------------
Judith Miller, Secretary
BAYSIDE MANAGEMENT CORP.
Per: /s/ Alexander Tavuchis
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Alexander Tavuchis
10
DEBT SETTLEMENT AGREEMENT
THIS AGREEMENT is made as of the 9th day of January 2002
BETWEEN:
DELTA CAPITAL TECHNOLOGIES INC., a Delaware company having an
office at B201, 1331 Homer Street, Vancouver, B.C. V6B 5M5
(the "Company")
OF THE FIRST PART
AND:
CHURCHILL RESOURCE GROUP INC. having an office located suite
207 - 1590 West 15th Avenue, Vancouver B.C. V6J 2K6
(the "Creditor")
OF THE SECOND PART
WHEREAS:
A. The Company is indebted to the Creditor in the amount of US$33,651.44
(the "Debt");
B. The Company has agreed to issue to the Creditor 336,514
(US$33,651.44/US$0.10 per share) common shares (the "Shares") in total
satisfaction of the Debt; and
C. The Creditor has agreed to accept the Shares from the Company in total
satisfaction of the Debt.
THEREFORE, in consideration of the premises and the mutual covenants
and agreements set forth in this Agreement, the parties agree as follows:
1.00 Debt Settlement
1.01 The Company will pay and satisfy the Debt by issuing the Shares to the
Creditor at a deemed price of US$0.01 per share for an aggregate amount equal to
the Debt payable on January 10, 2002.
1.02 The Creditor acknowledges and agrees that all outstanding accounts have
been rendered by the Creditor to the Company to the date of this Agreement and
upon issuance of the Shares to the Creditor there will be no outstanding
liability of the Company to the Creditor.
2.00 Headings
2.01 The headings and section references in this Agreement are for convenience
of reference only and do not form a part of this Agreement and are not intended
to interpret, define or limit the scope, extent or intent of this Agreement or
any provision thereof.
11
3.00 Governing Law
3.01 This Agreement and all matters arising hereunder shall be governed by,
construed and enforced in accordance with the laws of the State of Delaware and
all disputes arising under this Agreement shall be referred to, and the parties
attorn to the jurisdiction of, the courts of appropriate jurisdiction in the
State of Delaware.
4.00 Enurement
4.01 This Agreement shall enure to the benefit of and be binding upon the
parties hereto and their respective successors and permitted assigns.
5.00 Carrying Out Agreement
5.01 Each of the parties hereto hereby covenants and agrees to execute such
further and other documents and instruments and do such other things as may be
necessary to implement and carry out the intent of this Agreement.
6.00 Assignment
6.01 This Agreement shall not be assignable by the Creditor without the
written consent of the Company.
7.00 Counterparts
7.01 This Agreement, or any amendment to it, may be executed in counterparts,
each of which will be deemed an original agreement and all of which will
together constitute one agreement.
8.00 Amendment
8.01 Except as herein otherwise provided, no subsequent alteration, amendment,
change or addition to this Agreement shall be binding upon the parties hereto
unless reduced to writing and signed by the parties.
IN WITNESS WHEREOF the parties hereto have executed this Agreement as
of the day and year first above written.
DELTA CAPITAL TECHNOLOGIES, INC.
Per:
/s/ Judith Miller
----------------------------------------------------------------
Judith Miller, Secretary
CHURCHILL RESOURCE GROUP INC.
Per: /s/ Brian Hancock
-----------------------------------------------------------------
Brian Hancock, President
12
DEBT SETTLEMENT AGREEMENT
THIS AGREEMENT is made as of the 9th day of January 2002
BETWEEN:
DELTA CAPITAL TECHNOLOGIES INC., a Delaware company having an
office at B201, 1331 Homer Street, Vancouver, B.C. V6B 5M5
(the "Company")
OF THE FIRST PART
AND:
BP EQUITY MANAGEMENT CORP., having an office located at suite
700-1006 Beach Avenue, Vancouver B.C.V6E 1T7
(the "Creditor")
OF THE SECOND PART
WHEREAS:
A. The Company is indebted to the Creditor in the amount of US$15,774.31
(the "Debt");
B. The Company has agreed to issue to the Creditor 157,743
(US$15,774.31/US$0.10 per share) common shares (the "Shares") in total
satisfaction of the Debt; and
C. The Creditor has agreed to accept the Shares from the Company in total
satisfaction of the Debt.
THEREFORE, in consideration of the premises and the mutual covenants
and agreements set forth in this Agreement, the parties agree as follows:
1.00 Debt Settlement
1.01 The Company will pay and satisfy the Debt by issuing the Shares to the
Creditor at a deemed price of US$0.01 per share for an aggregate amount equal to
the Debt payable on January 10, 2002.
1.02 The Creditor acknowledges and agrees that all outstanding accounts have
been rendered by the Creditor to the Company to the date of this Agreement and
upon issuance of the Shares to the Creditor there will be no outstanding
liability of the Company to the Creditor.
2.00 Headings
2.01 The headings and section references in this Agreement are for convenience
of reference only and do not form a part of this Agreement and are not intended
to interpret, define or limit the scope, extent or intent of this Agreement or
any provision thereof.
3.00 Governing Law
3.01 This Agreement and all matters arising hereunder shall be governed by,
construed and enforced in accordance with the laws of the State of Delaware and
all disputes arising under this Agreement shall be referred to, and the parties
attorn to the jurisdiction of, the courts of appropriate jurisdiction in the
State of Delaware.
13
4.00 Enurement
4.01 This Agreement shall enure to the benefit of and be binding upon the
parties hereto and their respective successors and permitted assigns.
5.00 Carrying Out Agreement
5.01 Each of the parties hereto hereby covenants and agrees to execute such
further and other documents and instruments and do such other things as may be
necessary to implement and carry out the intent of this Agreement.
6.00 Assignment
6.01 This Agreement shall not be assignable by the Creditor without
the written consent of the Company.
7.00 Counterparts
7.01 This Agreement, or any amendment to it, may be executed in counterparts,
each of which will be deemed an original agreement and all of which will
together constitute one agreement.
8.00 Amendment
8.01 Except as herein otherwise provided, no subsequent alteration, amendment,
change or addition to this Agreement shall be binding upon the parties hereto
unless reduced to writing and signed by the parties.
IN WITNESS WHEREOF the parties hereto have executed this Agreement as
of the day and year first above written.
DELTA CAPITAL TECHNOLOGIES, INC.
Per:
/s/ Judith Miller
----------------------------------------------------------------
Judith Miller, Secretary
BP EQUITY MANAGEMENT CORP.
Per: /s/ Kent Carasquero
-----------------------------------------------------------------
Kent Carasquero, President
14
DEBT SETTLEMENT AGREEMENT
THIS AGREEMENT is made as of the 9th day of January 2002
BETWEEN:
DELTA CAPITAL TECHNOLOGIES INC., a Delaware company having an
office at B201, 1331 Homer Street, Vancouver, B.C. V6B 5M5
(the "Company")
OF THE FIRST PART
AND:
JEFF YOUNG businessman having an office located 7410 - 10 Taewha
Dong, Ulsan City , South Korea
(the "Creditor")
O OF THE SECOND PART
WHEREAS:
A. The Company is indebted to the Creditor in the amount of US$2,258.06
(the "Debt");
B. The Company has agreed to issue to the Creditor 22,580
(US$2,258.06/US$0.10 per share) common shares (the "Shares") in total
satisfaction of the Debt; and
C. The Creditor has agreed to accept the Shares from the Company in total
satisfaction of the Debt.
THEREFORE, in consideration of the premises and the mutual covenants
and agreements set forth in this Agreement, the parties agree as follows:
1.00 Debt Settlement
1.01 The Company will pay and satisfy the Debt by issuing the Shares to the
Creditor at a deemed price of US$0.01 per share for an aggregate amount equal to
the Debt payable on January 10, 2002.
1.02 The Creditor acknowledges and agrees that all outstanding accounts have
been rendered by the Creditor to the Company to the date of this Agreement and
upon issuance of the Shares to the Creditor there will be no outstanding
liability of the Company to the Creditor.
2.00 Headings
2.01 The headings and section references in this Agreement are for convenience
of reference only and do not form a part of this Agreement and are not intended
to interpret, define or limit the scope, extent or intent of this Agreement or
any provision thereof.
15
3.00 Governing Law
3.01 This Agreement and all matters arising hereunder shall be governed by,
construed and enforced in accordance with the laws of the State of Delaware and
all disputes arising under this Agreement shall be referred to, and the parties
attorn to the jurisdiction of, the courts of appropriate jurisdiction in the
State of Delaware.
4.00 Enurement
4.01 This Agreement shall enure to the benefit of and be binding upon the
parties hereto and their respective successors and permitted assigns.
5.00 Carrying Out Agreement
5.01 Each of the parties hereto hereby covenants and agrees to execute such
further and other documents and instruments and do such other things as may be
necessary to implement and carry out the intent of this Agreement.
6.00 Assignment
6.01 This Agreement shall not be assignable by the Creditor without the
written consent of the Company.
7.00 Counterparts
7.01 This Agreement, or any amendment to it, may be executed in counterparts,
each of which will be deemed an original agreement and all of which will
together constitute one agreement.
8.00 Amendment
8.01 Except as herein otherwise provided, no subsequent alteration, amendment,
change or addition to this Agreement shall be binding upon the parties hereto
unless reduced to writing and signed by the parties.
IN WITNESS WHEREOF the parties hereto have executed this Agreement as
of the day and year first above written.
DELTA CAPITAL TECHNOLOGIES, INC.
Per:
/s/ Judith Miller
----------------------------------------------------------------
Judith Miller, Secretary
Per: /s/ Jeff Young
--------------------------------------------------------
Jeff Young
16
DEBT SETTLEMENT AGREEMENT
THIS AGREEMENT is made as of the 10th day of January 2002
BETWEEN:
DELTA CAPITAL TECHNOLOGIES INC., a Delaware company having an
office at 7th Floor 1006 Beach Avenue, Vancouver, B.C. V6E 1T7
(the "Company")
OF THE FIRST PART
AND:
BONANZA MGMT LTD., a BC company having an office located at 1223
Pacific Drive, Delta, BC V4M 2K2
(the "Creditor")
OF THE SECOND PART
WHEREAS:
A. The Company is indebted to the Creditor in the amount of US$20,386.29
(the "Debt");
B. The Company has agreed to issue to the Creditor 200,386
(US$20,386.29/US$0.10 per share) common shares (the "Shares") in total
satisfaction of the Debt; and
C. The Creditor has agreed to accept the Shares from the Company in total
satisfaction of the Debt.
THEREFORE, in consideration of the premises and the mutual covenants and
agreements set forth in this Agreement, the parties agree as follows:
1.00 Debt Settlement
1.01 The Company will pay and satisfy the Debt by issuing the Shares to the
Creditor at a deemed price of US$0.10 per share for an aggregate amount equal to
the Debt payable on January 10, 2002.
1.02 The Creditor acknowledges and agrees that all outstanding accounts have
been rendered by the Creditor to the Company to the date of this Agreement and
upon issuance of the Shares to the Creditor there will be no outstanding
liability of the Company to the Creditor.
2.00 Headings
2.01 The headings and section references in this Agreement are for convenience
of reference only and do not form a part of this Agreement and are not intended
to interpret, define or limit the scope, extent or intent of this Agreement or
any provision thereof.
17
3.00 Governing Law
3.01 This Agreement and all matters arising hereunder shall be governed by,
construed and enforced in accordance with the laws of the State of Delaware and
all disputes arising under this Agreement shall be referred to, and the parties
attorn to the jurisdiction of, the courts of appropriate jurisdiction in the
State of Delaware.-
4.00 Enurement
4.01 This Agreement shall enure to the benefit of and be binding upon the
parties hereto and their respective successors and permitted assigns.
5.00 Carrying Out Agreement
5.01 Each of the parties hereto hereby covenants and agrees to execute such
further and other documents and instruments and do such other things as may be
necessary to implement and carry out the intent of this Agreement.
6.00 Assignment
6.01 This Agreement shall not be assignable by the Creditor without the
written consent of the Company.
7.00 Counterparts
7.01 This Agreement, or any amendment to it, may be executed in counterparts,
each of which will be deemed an original agreement and all of which will
together constitute one agreement.
8.00 Amendment
8.01 Except as herein otherwise provided, no subsequent alteration, amendment,
change or addition to this Agreement shall be binding upon the parties hereto
unless reduced to writing and signed by the parties.
IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the day
and year first above written.
DELTA CAPITAL TECHNOLOGIES, INC.
Per:
/s/ Judith Miller
----------------------------------------------------------------
Judith Miller, Secretary
BONANZA MGMT LTD.
Per: /s/ Terry Butchart
-----------------------------------------------------------------
Terry Butchart, President
18
DEBT SETTLEMENT AGREEMENT
THIS AGREEMENT is made as of the 10th day of January 2002
BETWEEN:
DELTA CAPITAL TECHNOLOGIES INC., a Delaware company having an
office at B201, 1331 Homer Street, Vancouver, B.C. V6B 5M5
(the "Company")
OF THE FIRST PART
AND:
PETER KENT CARASQUERO businessman having an office located at 82
Shoreview Drive Winnipeg, Manitoba, R2J 3G3
(the "Creditor")
OF THE SECOND PART
WHEREAS:
A. The Company is indebted to the Creditor in the amount of US$5000.00
(the "Debt");
B. The Company has agreed to issue to the Creditor 50,000
(US$5000.00/US$0.10 per share) common shares (the "Shares") in total
satisfaction of the Debt; and
C. The Creditor has agreed to accept the Shares from the Company in total
satisfaction of the Debt.
THEREFORE, in consideration of the premises and the mutual covenants
and agreements set forth in this Agreement, the parties agree as follows:
1.00 Debt Settlement
1.01 The Company will pay and satisfy the Debt by issuing the Shares to the
Creditor at a deemed price of US$0.01 per share for an aggregate amount equal to
the Debt payable on January 10, 2002.
1.02 The Creditor acknowledges and agrees that all outstanding accounts have
been rendered by the Creditor to the Company to the date of this Agreement and
upon issuance of the Shares to the Creditor there will be no outstanding
liability of the Company to the Creditor.
2.00 Headings
2.01 The headings and section references in this Agreement are for convenience
of reference only and do not form a part of this Agreement and are not intended
to interpret, define or limit the scope, extent or intent of this Agreement or
any provision thereof.
3.00 Governing Law
19
3.01 This Agreement and all matters arising hereunder shall be governed by,
construed and enforced in accordance with the laws of the State of Delaware and
all disputes arising under this Agreement shall be referred to, and the parties
attorn to the jurisdiction of, the courts of appropriate jurisdiction in the
State of Delaware.
4.00 Enurement
4.01 This Agreement shall enure to the benefit of and be binding upon the
parties hereto and their respective successors and permitted assigns.
5.00 Carrying Out Agreement
5.01 Each of the parties hereto hereby covenants and agrees to execute such
further and other documents and instruments and do such other things as may be
necessary to implement and carry out the intent of this Agreement.
6.00 Assignment
6.01 This Agreement shall not be assignable by the Creditor without the
written consent of the Company.
7.00 Counterparts
7.01 This Agreement, or any amendment to it, may be executed in counterparts,
each of which will be deemed an original agreement and all of which will
together constitute one agreement.
8.00 Amendment
8.01 Except as herein otherwise provided, no subsequent alteration, amendment,
change or addition to this Agreement shall be binding upon the parties hereto
unless reduced to writing and signed by the parties.
IN WITNESS WHEREOF the parties hereto have executed this Agreement as
of the day and year first above written.
DELTA CAPITAL TECHNOLOGIES, INC.
Per:
/s/ Judith Miller
----------------------------------------------------------------
Judith Miller, Secretary
Per: /s/ Peter Kent Carasquero
-----------------------------------------------
Peter Kent Carasquero
20
DEBT SETTLEMENT AGREEMENT
THIS AGREEMENT is made as of the 9th day of January 2002
BETWEEN:
DELTA CAPITAL TECHNOLOGIES INC., a Delaware company having an
office at B201, 1331 Homer Street, Vancouver, B.C. V6B 5M5
(the "Company")
OF THE FIRST PART
AND:
HOSPITALITY FINANCIAL SERVICES LTD. having an office located
at 1057 East 21st Avenue Vancouver, B.C. V5V 1S6
(the "Creditor")
OF THE SECOND PART
WHEREAS:
A. The Company is indebted to the Creditor in the amount of US$20,129.09
(the "Debt");
B. The Company has agreed to issue to the Creditor 201,290
(US$20,129.09/US$0.10 per share) common shares(the "Shares") in total
satisfaction of the Debt; and
C. The Creditor has agreed to accept the Shares from the Company in total
satisfaction of the Debt.
THEREFORE, in consideration of the premises and the mutual covenants
and agreements set forth in this Agreement, the parties agree as follows:
1.00 Debt Settlement
1.01 The Company will pay and satisfy the Debt by issuing the Shares to the
Creditor at a deemed price of US$0.01 per share for an aggregate amount equal to
the Debt payable on January 10, 2002.
1.02 The Creditor acknowledges and agrees that all outstanding accounts have
been rendered by the Creditor to the Company to the date of this Agreement and
upon issuance of the Shares to the Creditor there will be no outstanding
liability of the Company to the Creditor.
2.00 Headings
2.01 The headings and section references in this Agreement are for convenience
of reference only and do not form a part of this Agreement and are not intended
to interpret, define or limit the scope, extent or intent of this Agreement or
any provision thereof.
21
3.00 Governing Law
3.01 This Agreement and all matters arising hereunder shall be governed by,
construed and enforced in accordance with the laws of the State of Delaware and
all disputes arising under this Agreement shall be referred to, and the parties
attorn to the jurisdiction of, the courts of appropriate jurisdiction in the
State of Delaware.
4.00 Enurement
4.01 This Agreement shall enure to the benefit of and be binding upon the
parties hereto and their respective successors and permitted assigns.
5.00 Carrying Out Agreement
5.01 Each of the parties hereto hereby covenants and agrees to execute such
further and other documents and instruments and do such other things as may be
necessary to implement and carry out the intent of this Agreement.
6.00 Assignment
6.01 This Agreement shall not be assignable by the Creditor without the
written consent of the Company.
7.00 Counterparts
7.01 This Agreement, or any amendment to it, may be executed in counterparts,
each of which will be deemed an original agreement and all of which will
together constitute one agreement.
8.00 Amendment
8.01 Except as herein otherwise provided, no subsequent alteration, amendment,
change or addition to this Agreement shall be binding upon the parties hereto
unless reduced to writing and signed by the parties.
IN WITNESS WHEREOF the parties hereto have executed this Agreement as
of the day and year first above written.
DELTA CAPITAL TECHNOLOGIES, INC.
Per:
/s/ Judith Miller
----------------------------------------------------------------
Judith Miller, Secretary
HOSPITALITY FINANCIAL SERVICES LTD.
Per: /s/
-----------------------------------------------
22
FEE AGREEMENT
This FEE AGREEMENT (the "Agreement") is between Delta Capital Technologies,
Inc., (herein after the "Client" or the "Company") having an address at
B201-1331 Homer Street, Vancouver, B.C., Canada V6B 5M5, and Kent Carasquero
("Carasquero") whose address is 1057 East 21st Avenue Vancouver, B.C.V6E 1T7
Carasquero has agreed to provide necessary, non-promotional, services to
Client with respect to the day-to-day operation of the Company.
To protect both of the parties and to comply with professional
obligations, we have already discussed with each other and resolved any
potential conflicts of interest with present or former clients. The services
that Carasquero provides are in accordance with the following terms and
conditions:
1. Services to be Rendered
Client has retained Carasquero for the purpose of assisting the Company in
the conduct of its business, including its day-to-day operations. It is
contemplated that the services to be rendered by Carasquero will include, but
not necessarily be limited to:
1. Management of Accounts Receivable
2. Management of Accounts Payable
3. Liaison with Company creditors
4. Liaison with Company Accountants
5. Liaison with Company Lawyers
6. Liaison with Transfer Agent
7. Interfacing with Company directors and officers
It is understood that the services to be provided by Carasquero, as agreed to by
the parties pursuant to this agreement, shall include, but not be limited to,
non-promotional services necessary to assure compliance by the Company with the
provisions of the 1933 and 1934 Act, and regulations adopted pursuant thereto.
Carasquero shall have no responsibility for the accuracy of the substantive
representations or representations of fact which are or may be included in
documents filed with the Securities and Exchange Commission.
The Company shall be solely responsible for the substantive content of any SEC
filings and the truthfulness of all statements made therein. Carasquero's
services shall be to assist the Company in gathering the information, which may
be necessary to complete the filing and formatting the information provided by
the Client so that it is presented in compliance with the rules and regulations
adopted by the SEC.
23
2. Fees
Fees charged herein are based upon the reasonable value of Carasquero's services
as heretofore agreed to by the parties. Fees are based on the rates normally
charged by Carasquero. Carasquero's normal fee is Two Thousand Five Hundred
Dollars ($2,500.00) per month which sum may be payable by the issuance by the
company of that number of the $0.001 par value common stock equal to the fee
amount at a deemed price equal to the average bid price of the Companies shares
for the last 5 trading days of the billing period. It is anticipated that Client
and Carasquero may agree on fixed fees for special projects from time to time.
The fixed fee arrangements for special projects will be agreed to in writing
from time to time.
Client further understands that during the course of Carasquero's engagement, it
may be necessary or advisable for Carasquero to delegate various portions of
this matter to others and Client agrees to such delegation of tasks, and the
payment of the cost thereof, as Carasquero may believe is advisable or
necessary.
Services performed subsequent to the signing of this agreement will be billed at
normal billing rates as set forth herein.
Carasquero, has not been engaged to perform, nor will Carasquero agree to
perform any Investor Relations or Promotional services in connection with the
services to be provided to the Company. It is mutually understood and agreed
that any fees for services that are in connection with a capital raising
transaction shall be paid in cash.
3. Costs and Expenses
Client understands that in the course of any subsequent representation, it may
be necessary for Carasquero to incur certain costs or expenses. Client will
reimburse Carasquero for certain costs or expenses actually incurred and
reasonably necessary for completing the assigned matter, as long as the charges
for costs and expenses are competitive with other sources of the same products
or services. More particularly, Client will reimburse Carasquero in accordance
with the following guidelines:
A. Computer-Related Expenses. Client will
reimburse Carasquero for computerized research and
research services. However, any charges over $500 will require
prior approval. Client also encourages Carasquero to utilize
computer services that will enable Carasquero to more
efficiently manage the project.
B. Travel. Client will reimburse Carasquero for
expenses in connection with out of town travel.
However, Client will only reimburse for economy class travel
and, where necessary, for the reasonable cost of a rental car.
All related travel expenses, i.e., lodging and meals, must be
reasonable under the circumstances.
C. Filing Fees & Court Costs. Client will
reimburse Carasquero for expenses incurred in connection
with filing fees and court costs, if any, but will not be
responsible for sanctions or penalties imposed due to the
conduct of Carasquero.
4. Billing
Client shall have the option of paying subsequent billing by issuing sufficient
free trading shares to Carasquero which when sold will satisfy the amount owed.
Carasquero has not been engaged to perform, nor will Carasquero agree to
24
perform any services in connection with a capital raising transaction in
exchange for shares. It is mutually understood and agreed that any fees for
services that are in connection with a capital raising transaction shall be paid
in cash.
Registration of Client Shares
No later than ten (10) days following the date hereof as to the Fee Shares and
the Option, Client will cause such shares to be registered with the Securities
and Exchange Commission under a Form S-8 or other applicable registration
statement, and it shall cause such registration statement to remain effective at
all time while Carasquero holds such shares. At Carasquero's election, such
shares may be issued prior to registration in reliance on exemptions from
registration provided by Section 4(2) of the Securities Act of 1933 (the "33
Act"), Regulation D of the '33 Act, and applicable state securities laws.
5. Involvement of Client
Client expects to be kept closely involved with the progress of Carasquero's
services in this matter. Carasquero will keep Client informed of all material
developments in this matter, and, in the case of litigation or administrative
proceedings will provide sufficient notice to enable a representative to attend
meetings, conferences, hearings and other proceedings. A copy of all
correspondence in the course of Carasquero's services will be forwarded to
Client.
There may be times when Carasquero will need to obtain information from Client.
All requests for access to documents, employees, or other information shall be
granted without unreasonable delay. At the conclusion of this matter, all
documents obtained shall be returned upon request.
6. Waiver of Certain Conflicts.
Because Carasquero's representation is limited in scope, Client has agreed that,
subject to conditions described below, Carasquero may represent, now and in the
future, other persons and entities. In particular, Client has agreed that while
Carasquero is representing Client in active pending matters, he may represent
other clients in any matter adverse to Client (or Client's affiliates), provided
that the matters (a) are not substantially related to active matters Carasquero
is working on for Client, (b) do not involve situations where Carasquero has
obtained confidential information from Client that is material to the new
matter(s), and (c) do not involve litigation against Client. In addition, if
Carasquero's representation of Client is terminated, he may thereafter represent
others with interests adverse to Client's interests (even in litigation),
provided that the representation does not involve confidential information
Carasquero has obtained from Client that is material to those matters. By
executing this Agreement Client is confirming the above and agreeing to waive
any conflict of interest that arises in such situations.
7. Termination
Client shall have the right to terminate Carasquero's engagement by written
notice at any time. Carasquero has the same right to terminate this engagement,
subject to an obligation to give Client reasonable notice to permit it to obtain
alternative representation or services and subject to applicable ethical
provisions. Carasquero will be expected to provide reasonable assistance in
effecting a transfer of responsibilities to the new firm.
8. Records and Files Retention.
All records and files will be retained and disposed of in compliance with
25
Carasquero's policy in effect from time-to- time. Subject to future changes, it
is Carasquero's current policy not to retain records relating to a matter for
more than three (3) years from the date the matter is opened. Upon your prior
written request, I will return records to you prior to their destruction. It is
not administratively feasible to advise you of the closing of a matter or the
disposal of records. It is recommended, therefore, that you maintain your own
files for reference at the conclusion of this matter. If you have any questions
concerning records retention policies, please contact Carasquero.
9. No Guarantee of Success.
It is impossible to provide any promise or guarantee about the outcome of
Client's matter. Nothing in this Agreement or any statements by Carasquero or
his assistants in dealing with the Client's matters constitute a promise or
guarantee. Any comments about the outcome of the Client's matters are
expressions of opinion only.
10. Carasquero's Fees.
This Agreement is governed by the laws of British Columbia and sets forth the
entire agreement between the parties for rendering of the services, including
professional services, which may occur pursuant to the terms of this agreement.
All prior agreements or understandings of the parties have been and are merged
herein. This agreement can be amended or modified only in writing. Each party
signing below is jointly and severally responsible for all obligations due to
Carasquero and represents that each has full authority to execute this Agreement
so that it is binding. This Agreement my be signed in one or more counterparts
and binds each party signing it whether or not any other proposed signatory ever
executes it. If any provision of this Agreement or the application thereof is
held invalid or unenforceable, the invalidity or unenforceability shall not
affect other provisions or applications, and to this end the provisions of this
Agreement are declared to be severable.
"Client"
Delta Capital Technologies, Inc.
Dated: December 1, 2001
By:
Secretary
Name:_/s/________________________
Title: Secretary
Dated: December 1, 2001
Name: /s/ Kent Carasquero
-----------------------------
Kent Carasquero
26
STOCK PURCHASE AND SALE AGREEMENT STOCK PURCHASE AND SALE AGREEMENT
THIS STOCK PURCHASE AND SALE AGREEMENT (this "Agreement"), dated effective as
of March 8, 2002 is by and among, Interglobe Investigation Services Inc., a
British Columbia corporation ("Interglobe "), the shareholders of Interglobe who
have executed this Agreement as Shareholders ("Shareholders") and Homelands
Security Inc., a Nevada corporation ("Homelands").
RECITALS
A. Interglobe is a privately held, non-reporting corporation with
its principal operations located in Vancouver, British Columbia, Canada.
B. Homelands is a wholly owned non-reporting subsidiary of Delta Capital
Technologies, Inc a publicly held, reporting corporation, with its principal
operations located in Vancouver, British Columbia, Canada.
C. Shareholders desire to sell and Homelands desires to purchase all of the
outstanding shares of Interglobe pursuant to the terms and conditions of this
Agreement.
AGREEMENT
In consideration of the foregoing recitals and the mutual promises
contained herein, Homelands, Interglobe and the Shareholders hereby agree as
follows:
1. Purchase and Sale of Shares.
---------------------------
1.1 Property Subject to the terms and conditions of this Agreement,
Shareholders agree to sell and assign to Homelands on the Closing Date (as
defined below), free and clear of all mortgages, security interests, liens,
pledges, adverse claims and other encumbrances, (a) all of the outstanding
shares of stock of Interglobe as set forth on Exhibit A attached hereto
(collectively, the "Shares"). In exchange for the Shares, Homelands agrees to
issue 950,000 shares of Homelands common stock to the Shareholders on the
Closing Date pro rata in accordance with their respective holdings of the shares
on the date hereof.
2. Closing Date; Delivery.
----------------------
2.1 Closing Date. ------------ The closing of the purchase and sale of the
Shares (the "Closing") will be held at theoffices of Homelands, at 10:00 a.m. on
April 15, 2002, or at such earlier date as may be agreed in writing by
Interglobe , Shareholders and Homelands (the "Closing Date").
2.2 Deliveries at Closing.
---------------------
(a) Deliveries of Shareholders to Homelands. At the Closing,
if the conditions precedent set forth in Section 5.2 are
fulfilled in reasonable satisfaction, Shareholders will
deliver to Homelands (1) stock certificates or other documents
of title representing all of the shares of stock held of
record or beneficially owned in Interglobe on the Closing
Date, duly endorsed by the Shareholders for transfer to
Homelands. Shareholders and Interglobe will also deliver such
other documents and
27
instruments as Homelands may reasonably request to confirm
that the Shareholders and Interglobe have performed all of
their obligations and fulfilled all of the conditions of this
Agreement.
(b) Deliveries of Homelands to Shareholders. At the Closing,
if the conditions precedent set forth in Section 5.1 are
fulfilled in reasonable satisfaction, Homelands will deliver
to the Shareholders stock certificates representing 950,000
shares of Homelands's Common Stock, par value $0.001 issued in
the respective names of the Shareholders. Homelands will also
deliver such other documents and instruments as the
Shareholders may reasonably request to confirm that Homelands
has performed all of its obligations and fulfilled all of the
conditions of this Agreement.
3. Representations and Warranties of Interglobe .
Shareholders and Interglobe hereby represent and warrant to Homelands that:
3.1 Organization, Standing and Authority of Interglobe .
(a) Organization. Interglobe is a corporation duly organized
and validly existing under the laws of the Province of British
Columbia and is in good standing as a domestic corporation
under the laws of said Province.
(b) Charter Documents. Interglobe has furnished counsel
for Homelands with true and complete
copies of its Articles of Incorporation, as amended to date,
and its Bylaws as currently in effect.
(c) Corporate Power. Interglobe has all requisite
corporate power to enter into this Agreement and to carry out
and perform its obligations hereunder.
(d) Authorization for Agreement. The execution and performance
of this Agreement by Interglobe has been duly authorized by
its Board of Directors. Upon execution and delivery of this
Agreement on behalf of Interglobe , this Agreement will
constitute the valid and legally binding obligation of
Interglobe , enforceable in accordance with its terms and
conditions. The execution, delivery and performance of this
Agreement and compliance with the provisions hereof by
Interglobe does not and will not conflict with, or result in a
breach or violation of the terms, conditions or provisions of,
or constitute a default under, or result in the creation or
imposition of any lien pursuant to the terms of, Interglobe 's
Articles of Incorporation, as amended, Interglobe 's current
Bylaws, or any statute, law, rule or regulation or any order,
judgment, decree, indenture, mortgage lease or other agreement
or instrument to which Interglobe is subject.
(e) Financial Statements. The unaudited financial statements
of Interglobe as of December 31, 2001, are attached hereto as
Exhibit B (the "Financial Statements"). The Financial
Statements present fairly the financial condition of
Interglobe as of the periods covered in conformity with
generally accepted accounting principles applied on a basis
consistent with preceding periods.
(f) Material Changes. Since December 31, 2001, there have been
no material adverse changes in the financial condition of
Interglobe from that shown on the Financial Statements as of
such date except to the extent that Interglobe has entered
into a loan agreement in an amount of $105,000 CDN attached
hereto as Exhibit C (the "Loan Agreement").
28
3.2 Financial and Operating Status of Interglobe .
---------------------------------------------
(a) Tax Returns. Interglobe has duly filed all federal,
provincial and local tax returns required to be filed by it,
and all taxes, assessments and penalties set forth in such
returns have been timely and fully paid or adequately reserved
against in the Financial Statements. None of Interglobe 's tax
returns have ever been audited by any governmental taxing
authority.
(b) Contracts and Commitments. Interglobe has no written or
oral contracts or commitments involving any obligation,
consideration or expenditure, outside the purchase of normal
inventory items in quantities in accordance with previous
practices except as set forth in the Schedule of Disclosures
attached hereto as Exhibit D. Interglobe has delivered to
Homelands's counsel true, complete and correct copies of all
such contracts and commitments, together with all amendments
thereto, all of which are listed on the Schedule of
Disclosures, and all such contracts are in full force and
effect in the form delivered. Interglobe has set forth in the
Schedule of Disclosures (i) all insurance policies in force on
the date hereof; (ii) the names and locations of all banks and
other depositories in which it has accounts or safe deposit
boxes and the names of persons authorized to sign checks,
drafts or other instruments drawn thereon or to have access
thereof; (iii) all mortgages, promissory notes, deeds of
trust, loan or credit agreements or similar agreements, or
modifications thereof, to which it is a party and all amounts
thereof; and (iv) all accounts receivable of Interglobe as of
December 31, 2001 and as reflected in the Financial
Statements(v) all security licenses.
(c) Employees. Interglobe does not have any collective
bargaining agreements with any of its employees. Interglobe is
not a party to any contract with any of its employees,
consultants, advisors, sales representatives, distributors or
customers that is not terminable by Interglobe without
liability, penalty or premium on 30 days' notice, except as
otherwise set forth in the Schedule of Disclosures.
(d) Benefits. Interglobe does not have any health, dental,
pension, retirement, or other benefit programs for its
employees or in which its employees participate, except as set
forth in the Schedule of Disclosures.
(e) Inventory. All inventory of Interglobe is saleable and in
good condition, the value of which as of December 31, 2001 has
been written down or reserved to amounts not in excess of
realizable market value.
(f) Equipment. All equipment of Interglobe is in good order
and repair except minor defects which do not materially
interfere with the continued use of such equipment.
(g) Litigation. There is no action, proceeding or
investigation pending or, to the knowledge of Interglobe ,
threatened against Interglobe , or any of Interglobe 's
property or assets which might result in any material and
adverse change in the property, assets or financial condition
of Interglobe , nor, to the knowledge of Interglobe , is there
any basis for any such action, proceeding or investigation. To
the best knowledge of Interglobe it is in compliance in all
material respects with all laws and regulations applicable to
it, its properties and businesses.
4. Representations and Warranties of Homelands. Homelands
hereby represents and warrants to Interglobe and the
Shareholders that the matters set forth in the following
subsections of this Section 4 are true and correct.
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4.1 Corporate Organization
(a) Organization. Homelands is a corporation duly
organized, validly existing and in good
standing under the laws of the State of Nevada.
(b) Financial Statements. The Annual report under
Section 13 or 15(d) of the Securities Exchange Act
of 1934 for the fiscal year ended December 31, 2001, which
includes the audited consolidated financial statements of
Homelands parent company, Delta Capital Technologies, Inc. are
attached hereto as Exhibit E (the "Delta Capital Technologies,
Inc. Financial Statements"). The Delta Capital Technologies,
Inc. Financial Statements present fairly the financial
condition of Homelands parent company as of the periods
covered in conformity with generally accepted accounting
principles applied on a basis consistent with preceding
periods.
(c) Material Changes. Since the last quarterly Homelands
Financial Statements, there have been no material changes in
the financial condition of Homelands from that shown on the
Homelands Financial Statements as of such date.
(d) Reporting Status. Homelands is not public or a reporting
company under Section 13 or 15(d) of the Securities Exchange
Act of 1934. None of the information contained in any of the
reports filed by Homelands pursuant to Section 13 of such
statute contains any misstatement of a material fact or omits
any information required to make the information contained
therein not materially misleading.
4.2 Due Execution and Enforceability. The
execution, delivery and performance of this Agreement and
the other agreements between the parties hereto referred to
herein by and on behalf of Homelands have been duly and
validly authorized by the Homelands Board of Directors.
5. Conditions to Closing.
---------------------
5.1 Conditions to Obligations of Homelands.
--------------------------------------
The obligations of Homelands to purchase the Shares at
the Closing and to consummate any other transaction
contemplated by this Agreement are subject to the fulfillment
to Homelands's satisfaction on or prior to the Closing date of
the following conditions, any of which may be waived in whole
or in part by Homelands.
(a) Representation and Warranties True at Closing. The
representations and warranties made by the Shareholders and
Interglobe in Section 3 above shall be true and correct in all
material respects on and as of the Closing Date with the same
force and effect as if they had been made and given on and as
of the Closing Date, and the Shareholders and Interglobe shall
have performed and complied with all agreements and
obligations to be performed by it under this Agreement on or
prior to the Closing.
(b) Authorization. Interglobe shall have obtained all
Board of Directors approval necessary to authorize its
participation in the transaction described in this Agreement.
(c) No Adverse Change. Prior to the Closing there
shall not have occurred any loss or destruction of any
material part of the assets of Interglobe or any material
and adverse change in the
30
financial condition, properties, business or operation of
Interglobe from that shown in the Financial Statements.
(d) Documents and Instruments Satisfactory. All
documents and instruments to be provided by Interglobe and
the Shareholders in connection with the transactions
contemplated by this Agreement must be satisfactory in form
and substance to counsel for Homelands.
5.2 Conditions to Obligations of Interglobe and Its Shareholders
The obligations of the Shareholders and Interglobe to
consummate this Agreement and carry out and perform their
obligations hereunder are subject to the satisfaction of all
of the following conditions unless waived by Shareholders.
(a) Representations and Warranties True at Closing. The
representations and warranties made by Homelands in this
Agreement shall be true and correct in all material respects
on and as of the Closing Date with the same force and effect
as if they had been made and given on as of the Closing Date.
Homelands shall have performed and complied in all material
respects with all agreements and obligations to be performed
by it under this Agreement on or before the Closing Date.
(b) Authorization.
Homelands shall have obtained all Board of Directors approval
necessary to authorize its participation in the transaction
described in this agreement.
(c) No Adverse Change.
Prior to the Closing there shall not have occurred any
material and adverse change in the financial condition,
properties, business or operations of Homelands since the
date of this Agreement.
(e) Documents and Instruments Satisfactory.
All documents and instruments to be provided by Homelands in
connection with the transactions contemplated by this
Agreement must be satisfactory in form and substance to
counsel for Shareholders and Interglobe .
(f) Due Diligence Satisfactory. Shareholders and Interglobe
have received all of the information reasonably requested by
them from Homelands in connection with this transaction, and,
based on its due diligence investigation, are satisfied with
the financial and operating condition of Homelands.
6. Covenants and Agreements of Interglobe .
---------------------------------------
6.1 Access to Information. From and after the date of this Agreement and
until the Closing, Shareholders agree that the authorized representatives of
Homelands shall have access during normal business hours to the properties,
facilities, books, records, contracts and documents of Interglobe and Interglobe
shall furnish or cause to be furnished to the authorized representatives of
Homelands copies of all documents and all information with respect to the
affairs and businesses of Interglobe that Homelands's representatives may
reasonably request. Homelands shall keep all such information confidential and
shall not use the same for any purpose or disclose the same to any other person
or entity pending the consummation of the transactions contemplated hereby.
6.2 Conduct of Business Pending the Closing. Unless expressly consented
to by Homelands or otherwise permitted or required under this Agreement, from
and after the date of this Agreement and until the Closing or the termination or
abandonment of this Agreement as provided herein:
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(a) Business in the Ordinary Course. Interglobe will (i) conduct its
business only in the ordinary course in the same manner as before date of this
Agreement, (ii) will not institute any unusual or novel methods of manufacture,
purchase, sale, lease, service, accounting or operation, (iii) will not grant
any increase in the rate of pay or other benefits or compensation of any
officers or employees, and (iv) will not enter into, amend or terminate any
contract or commitment not in the usual and ordinary course of business and
consistent with Interglobe 's past practice.
(b) Indebtedness. Interglobe will not (i) incur or assume or guarantee
any indebtedness other than indebtedness incurred in the usual and ordinary
course of business for goods or services or pursuant to existing commitments or
agreements previously disclosed in writing to Homelands under this Agreement, or
(ii) enter into, execute or deliver any agreement or writing to the release or
settlement of claims, except as otherwise provided by this Agreement.
(c) Corporate Structure. Interglobe will not (i) amend its articles of
incorporation or bylaws or change its officers or directors or (ii) issue any
additional capital stock or other securities or grant any warrants, options or
rights to purchase or acquire any capital stock or other securities of
Interglobe , or (iii) merge or consolidate with any other corporation or acquire
all or substantially all of the stock, business or assets of any other person or
entity or sell, assign or transfer substantially all of its assets or
outstanding securities to any other person or entity.
(d) Dividends and Capital Stock. Interglobe will not (i) declare or
pay any dividend or make any stock split or stock dividend or other distribution
with respect to its capital stock, or (ii) directly or indirectly redeem,
purchase or otherwise acquire for value any of its capital stock.
(e) Banking Relationships. No change will be made affecting
Interglobe 's banking relationships and Interglobe shall
open no new bank or other deposit accounts.
(f) Insurance. Interglobe will maintain in full force and effect
all policies of insurance now in effect and will give all
notices and present all claims under all policies in a
timely fashion.
(g) Licenses: Interglobe will maintain in full force and
effect all related security licenses now in effect.
7. Covenants and Agreements of Homelands.
-------------------------------------
7.1 Homelands shall not, nor shall it cause, permit or suffer
Interglobe to, in each case without the prior majority
consent of the shareholders of Homelands:
7.1.2 elect as directors of Interglobe any more than three
individuals, one of whom shall be Phillip Moriarty or persons
designated by him or remove any such directors so elected,
7.2.2 sell, hypothecate, liquidate or otherwise dispose of all or
any significant portion of the assets of Interglobe or any
interest therein;
7.2.3 merge or consolidate Interglobe with any other person or
entity or enter into any plan or agreement with respect
thereto;
7.2.4 enter into any agreement between Interglobe and Homelands,
or between Interglobe and any
32
person or entity controlled by Homelands, any person or entity
controlling Homelands or any person or entity under common
control with Homelands (any person or entity controlling,
controlled by or under common control with Homelands is
referenced herein as a "Homelands Affiliate");
7.2.5 issue any shares of the capital stock of Interglobe or any
shares or other securities convertible into or exchangeable
or exercisable for such shares of capital stock except to the
extent contemplated by Section 7.6 hereof and except to the
extent such shares or other securities are issued in
connection with a public distribution thereof in a
transaction or series of transactions approved by the Board
of Directors of Interglobe ;
7.2.7 incur any indebtedness of Interglobe for borrowed money,
either directly or as guarantor of any obligations of
Homelands or any Homelands Affiliate;
7.2.8 adopt any plan or petition any court or governmental agency
for the dissolution of Interglobe ; or
7.2.9 take any action of Interglobe or permit or suffer the
occurrence of any action of Interglobe that is otherwise
within the prerogatives of the Board of Directors of a
corporation organized under the laws of the Province of
British Columbia.
8. Miscellaneous.
-------------
8.1 Successors and Assigns. This Agreement and the terms and
conditions contained herein are binding upon, and will
inure to the benefit of, the parties hereto and their
respective representatives, executors, administrators, heirs,
successors and assigns, but, except as otherwise specifically
provided herein, neither this Agreement nor any rights
or obligations hereunder may be assigned, directly,
indirectly, voluntarily or involuntarily, except by
operation or law, by any party to this Agreement.
8.2 Governing Law; Severability. This Agreement will be governed
by and construed in accordance with the laws of the State of
Nevada. If any provision of this Agreement is found to be
invalid, illegal or unenforceable in any respect, such
provision will be enforced to the maximum extent possible and
the remaining provisions of this Agreement will continue
unaffected.
8.3 Waivers. No waiver by any party hereto of any term or
condition of this Agreement will be effective unless set
forth in a writing signed by such party. No waiver of any
provision of this Agreement will be deemed a waiver of any
other provision, or constitute a continuing waiver unless
otherwise expressly provided in writing by the waiving party.
No failure or delay on the part of any party in exercising
any right, power or privilege under this Agreement will
operate as a waiver thereof, nor will a single or partial
exercise thereof preclude any other or further exercise of
any other rights, powers or privileges.
8.4 Entire Agreement; Modifications. This Agreement, together with
the exhibits and schedules attached hereto, each of which is
incorporated herein by this reference, constitutes the entire
agreement among the parties hereto pertaining to the subject
matter hereof and supersedes in its entirety all prior and
contemporaneous agreements, understandings, negotiations and
discussions between the parties (specifically including
without limitation the letter of intent dated February 28,
2002 and executed by Homelands and Interglobe in connection
with this Agreement), whether oral or written, with respect
to the subject matter of
33
this Agreement. No supplement, modification or amendment to
this Agreement will be binding unless executed in writing by
Interglobe, Shareholders and Homelands.
8.5 Notices. All notices and other communications required or
permitted under this Agreement will be in writing and may be
hand delivered, mailed by first-class mail, postage prepaid,
or sent via facsimile. Unless otherwise agreed to in writing
by the parties, such notices and other communications shall
be addressed as follows:
If to Homelands:
Darwyn Ross, Director
Homelands Security, Inc.
1403 East, 900 South
Salt Lake City
Utah, 84105
If to Interglobe :
Philip Moriarty, President
Interglobe Investigation Services Inc.
Interglobe Investigation Services, Inc.
708-1155 West Pender Street
Vancouver, B.C.
V6E 2P4
8.6 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original and all of which
together shall constitute one instrument.
8.7 Headings; References. Headings used in this Agreement are used for
convenience only and are not to be considered in construing or
interpreting this Agreement.
8.8 Expenses. Homelands shall timely pay all of the fees and expenses,
including, without limitation, the fees and expenses of counsel and
accountants incurred by itself in the negotiation, preparation and
execution of this Agreement and in the consummation of the transactions
contemplated hereby.
IN WITNESS WHEREOF, the parties have executed this Agreement on the dates set
forth below, to be effective for all purposes as of the date first written
above.
34
Interglobe Investigation Services, Inc., a Homelands Security, Inc., a Nevada
British Columbia corporation corporation
By:___s/s/ Philip Moriary By:__/s/ Darwyn Ross
--------------- -----------
Philip Moriarty, President Darwyn Ross
35