Delaware 7374 98-0229951 (State or other jurisdiction (Primary Standard Industrial (I.R.S. Employer of incorporation or organization) Classification Code) Identification Number) 4055 St. Catherine Street West Irving Rothstein, Esq. Suite 133 Heller, Horowitz & Feit, P.C. Montreal H3Z 3J8 Quebec 292 Madison Avenue (514) 940-1098 CANADA New York, New York 10017 (Address and telephone number (212) 685-7600 of registrant's principal executive (Name, address and telephone offices and principal place of business) number of agent for service) |
Irving Rothstein, Esq.
Heller, Horowitz & Feit, P.C.
292 Madison Avenue
New York, New York 10017
Telephone: (212) 685-7600
Approximate date of commencement of proposed sale to public: At the
discretion of the selling stockholders.
If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box. [X]
CALCULATION OF REGISTRATION FEE
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Title of Each Class of Securities to be Amount To Be Proposed Maximum Proposed Maximum Aggregate Amount of
Registered Registered Offering Price Per Offering Price Registration Fee
Security
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Common Stock, par value $0.0001 11,000,000 $0.025(1) $275,000 $83.33
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(1) based upon the price of a private offering.
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The registrant hereby amends the registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.
11,000,000 Shares of Common Stock
This prospectus covers 11,000,000 shares of the common stock, par value $.0001 per share, of Sword Comp Soft Corp. The common stock offered here will be sold solely by the selling stockholders.
The securities offered hereby involve a high degree of risk. Please read the "Risk factors" beginning on page 2.
There is presently no public market for our securities. We intend to apply for a listing on NASDAQ on the OTC:BB.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
Our principal executive offices are located at 4055 St. Catherine
Street West, Ste 133, Westmount, Quebec H3Z 3J8, CANADA. Our telephone number is
(514) 940-1098.
The date of the Prospectus is October __, 2000.
Risk factors
You should carefully consider the following facts and other information in this prospectus before deciding to invest in the shares.
Since we have only a limited operating history, it is difficult for you to evaluate if we are a good investment
We were incorporated in November 1998. As of this date, we have not introduced our first services. Accordingly, we have only a very limited operating history, and we face all of the risks and uncertainties encountered by early-stage companies. Thus, our prospects must be considered in light of the risks, expenses and difficulties associated with a new and rapidly evolving market for proprietary Application Service Providers focusing on e-healthcare. In sum, because of our limited history and the youth and inherent risks of our industry, predictions of our future performance are very difficult.
Our independent auditor has expressed concern over our ability to remain in business and if we go out of business your investment will be lost
In his report on our audited financial statements, our auditor has stated that there is a substantial doubt as to whether we will be able to remain in business for even the next twelve months. His concern is based upon our growing losses and no specific plan to have the funds necessary to implement our business plan. If his concerns are proven accurate, any investment in our securities will likely be lost.
We have incurred losses and anticipate even more losses in the future which may cause us to become insolvent
From our inception in November 1998 through April 30, 2000, we incurred an accumulated deficit of $11,454. We anticipate incurring significant losses until, at the earliest, we generate sufficient revenues to offset the substantial up-front expenditures and operating costs associated with developing and commercializing our products. There can be no assurance that we will ever operate profitably.
We have no customers and generate no revenues and if we do not develop customers and generate revenue we will go out of business
We have not entered into any agreements to utilize our technology with any subscribers or alliance partners. We do not believe that we will generate significant revenues in the immediate future. We will not generate any meaningful revenues unless we obtain contracts with a significant number of subscribers and a few health alliance partners. There can be no assurance that we will ever be able to obtain contracts with a significant number of subscribers to generate meaningful revenues or achieve profitable operations.
Our success is dependent on successful implementation of our business plan, still in development. This involves developing and expanding our operations on a profitable basis and developing non-traditional marketing and promotional channels that would be available to promote our services on a monthly fee basis. We are unaware of any other entity that has attempted to accomplish what we propose to do and there is no assurance that we will be successful or that our business model and services will be accepted in the industry or result in the generation of significant revenues.
We need additional financing or we may have to curtail operations and investors will lose their money
Our capital requirements relating to the commercialization of our technology will be significant. We will be dependent on the proceeds of future financings in order to continue in business and to develop and commercialize additional proposed application services. We currently project requiring an additional $ 420,000 in new financing. There can be no assurance that we will be able to raise the additional capital resources necessary to permit us to pursue our business plan. We have no current arrangements with respect to, or sources of, additional financing and there can be no assurance that any such financing will be available to us on commercially reasonable terms, or at all. Any inability to obtain additional financing will have a material adverse effect on us, such as requiring us to significantly curtail or cease operations.
Our infrastructure may not be reliable because it may not be large enough to accommodate growth and because of third party disruptions and if this occurs we will lose customers
Our operations will depend upon the capacity, reliability, security and privacy of our systems infrastructure. We currently have only limited system capacity and will be required to continually expand our systems infrastructure to accommodate significant numbers of subscribers and their personal data. Development and/or expansion of our systems infrastructure will require additional financial, operational and managerial resources. There can be no assurance that we will be able to expand our systems infrastructure to meet potential demand on a timely basis or at a commercially reasonable cost. Our failure to develop and/or expand our systems infrastructure on a timely basis could have a material adverse effect on us. We will be dependent upon co-location and online service providers for access to our application services.
Our systems infrastructure will also be vulnerable to computer viruses, break-ins and similar disruptions from unauthorized tampering with our computer systems. Computer viruses or problems caused by third parties could lead to material interruptions, delays or cessation in service to our customers. Inappropriate use of the internet by third parties could also potentially jeopardize the security of confidential information stored in the computer systems of consumers. Security and privacy concerns of consumers may limit our ability to develop a significant subscriber base.
We may face liability because of the content transmitted over our systems and if found liable the amount of damages could make us insolvent
The liability we may face as a result of content disseminated through our system could have a negative impact on our financial condition. The law relating to the liability of businesses such as ours for content carried on or disseminated through their system is currently unsettled. We could become involved in litigation regarding the content transmitted over our system, which could create adverse publicity, significant defense costs and substantial damage awards. In addition, because health content materials can be downloaded and may be subsequently distributed to others, there is a potential that claims will be made against us for defamation, negligence, copyright or trademark infringement or other theories based on the nature and content of such materials.
We could also be exposed to liability in connection with the selection of materials that may be accessible over our system. Claims could be made against us if material or reports deemed inappropriate or incorrect by health viewers could be accessed. For instance, a subscriber may tells us about their hypertension leading us to recommend exercise but they fail to tell us that they are osteoporic and they break a bone.
While we intend to carry insurance policies, our insurance may not cover potential claims of this type or may not be adequate to cover liability that may be imposed or related defense costs. There can be no assurance that we will not face claims resulting in substantial liability for which we are partially or completely uninsured. Any partially or completely uninsured claim against us would have a material adverse effect on our ability to operate.
Special note regarding forward-looking statements
Some of the statements under "Risk factors," Plan of operations," "Business" and elsewhere in this prospectus are forward-looking statements that involve risks and uncertainties. These forward-looking statements include statements about our plans, objectives, expectations, intentions and assumptions and other statements contained in this prospectus that are not statements of historical fact. You can identify these statements by words such as "may," "will," "should," "estimates," "plans," "expects," "believes," "intends" and similar expressions. We cannot guarantee future results, levels of activity, performance or achievements. Our actual results and the timing of certain events may differ significantly from the results discussed in the forward-looking statements. Factors that might cause such a discrepancy include those discussed in "Risk factors" and elsewhere in this prospectus. You are cautioned not to place undue reliance on any forward-looking statements.
Summary historical financial information
The following selected financial data for the year ended April 30, 2000 and for the period November 2, 1998 (inception) through April 30, 2000 is derived from our audited financial statements included in this prospectus.
The following data should be read in conjunction with our financial statements.
Statement of operations data
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Year ended
From 11/02/98 4/30/2000
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(Inception)
to 04/30/2000
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----------------------------------------- --------------------------------------- ---------------------------------------
$
Net Revenues $ -0-
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----------------------------------------- --------------------------------------- ---------------------------------------
$
Operating Loss $ (11,454)
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----------------------------------------- --------------------------------------- ---------------------------------------
$
Income Taxes $ -0-
----------------------------------------- --------------------------------------- ---------------------------------------
----------------------------------------- --------------------------------------- ---------------------------------------
$
Net Loss $ (11,454)
----------------------------------------- --------------------------------------- ---------------------------------------
----------------------------------------- --------------------------------------- ---------------------------------------
$
Loss Per Share $ (.001)
(Basic and Diluted)
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----------------------------------------- --------------------------------------- ---------------------------------------
----------------------------------------- --------------------------------------- ---------------------------------------
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Balance sheet data
April 30, 2000
Working Capital $ 144,807
Total Assets $ 166,660
Total Liabilities $ 6,853
Stockholders' Equity $ 159,807
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Plan of operations
The following discussion should be read in conjunction with the financial statements and related notes, which are included elsewhere in this prospectus.
Sword Comp-Soft Corp., based in Montreal, Canada, is a new Application Service Provider initially investing in the e-healthcare sector. Application Services, a rapidly growing segment of the internet economy, is the term used to describe internet providers that focus on a single topic or issue in a conversational manner. We were initially formed in November 1998 and are currently still in the development phase and preparing to begin commercial activity in the first quarter of 2001.
We now have what we believe is some of the most advanced technology currently available in the field of e-healthcare. We also hope to benefit from our relationship with Millenia Hope, Inc., our controlling shareholder, via participation with their scientific committee and products and services. While we expect to incur direct expenditures for research and development in the approximate amount of $ 260,000 thru December 2000, we expect
governmental agencies of Canada, who provide excellent incentives, to provide us with grants. Research and development grants will be recorded as a reduction of expense on the income statement, leaving us with the net amount of the expense.
The first array of our application services are currently expected to be available by the end of 2000. Although our products have worldwide application, the marketing plan for the first year of operations is to concentrate on the North American market and to focus, particularly during the balance of this year, on significant opportunities that have been identified for or by twenty of the top companies which are: Abbot; Astra; Bayer; Bristol Myers Squibb; Eli Lilly; Hoechst Marion Roussel; Glaxo Wellcome; Hoffman Laroche; Janssen-Ortho; Merck; Novartis; Novopharm; Parke-Davis; Pfizer; Pharmacia & Upjohn; Rhone-Poulenc; Schering Plough; Smith Kline Beecham; Wyeth-Ayerst; and Zeneca Pharma. Should we be unable to complete formal contracts with a few one of the major pharmaceutical companies, our plan is to market directly to consumers on a monthly fee basis.
Initially, our interactive health service applications will be promoted primarily via our web site, internet on-line advertising and by an aggressive effort to recruit specific web communities that are health and well being oriented. Co-parenting, the joining of two products/services or ideas presented as a single corporate message, will be employed in tandem with major medical and not for profit organizations to raise the profile of our unique offering. As interest grows commensurately, we will employ a wider choice of media outlets to promote our website, Medicocenter.com
We believe that our sales targets are both modest and achievable based upon ad hoc discussions with potential health alliance partners. We hope to break even this year and have revenues of $1.3 million during fiscal 2001. We currently anticipate that our monthly burn rate, once we commence sales, will be approximately $40,000.
During our initial fundraising in 2000, we sold 11,000,000 shares for an aggregate of $275,000. We anticipate using these funds as follows.
Research & Development $ 75,000 Advertising and Marketing $ 67,000 Rent & office equipment $ 22,000 Administration & Selling $ 72,000 Internet setup and bandwidth $ 19,000 Legal, Accounting, offering cost $ 20,000 |
We believe our current cash on hand is sufficient to see us through the development stage and until we are able to bring the first of our application service providers on line and generating revenue.
Year 2000 disclosure
We are Year 2000 compliant and we do not anticipate any internal problems. In the event any internal problems should arise, we have many
expert computer technicians available to us and we believe that we will be able to satisfactorily address any such problems. However, we are dependent on the integrity of the internet being maintained to derive income from the sale of subscriptions and advertising spots and if the internet should fail or if our hosts or internet service providers should fail, we could be adversely impacted. Given the currently available information this does not appear to be a likely scenario and, accordingly, we do not believe that our potential for profitability or operations will be materially affected by the Year 2000 problem.
The most important technical success factors have been assuring unique reliable health modules on top of basic e-commerce and online mass storage capabilities.
Business
We were initially formed in November 1998 and are currently still in the development phase and preparing to begin commercial activity in the first quarter of 2001. We are based in Montreal, Canada. We are a new Application Service Provider initially investing in the e-healthcare sector. Application Services, a rapidly growing segment of the internet economy, is the term used to describe internet providers that focus on a single topic or issue in a conversational manner.
We are working on a pilot and believe that we will be in a position to offer a range of application services designed around the concept of providing a series of useful, on-line interactive health services and facilities in an attractive, convenient format to people in their personal electronic environments. These application services include the identification and personal logging of disease(s) and strategies to cope with long term health issues from nutrition, wellness and health in a "patient driven" format.
Essentially, the subscribers use application programs to
create, store and transact medical data on the application server, for example:
the interactive on-line health service will record similar data to that usually
given to a primary health care worker, such as a doctor or a nurse, and create
an overall profile of individual health needs. Each application will relate to a
specific disease, drug, or part of the human anatomy on a pay per use basis,
although this fee may be sponsored. We also plan to offer pre-operative
processing support.
The first of the applications on which the Company intends to focus are the areas of nutrition, osteoporosis, diabetes and the human skeletal system. We are planning to work on drug ASPs to enhance data for real trials and encourage and remind patients to take all their prescriptions on a timely and complete basis. This important data, on an ever-increasing number of patients for that particular drug or course of treatment, is of great value.
Consumers will be able to access the Company's branded subsidiary site, www.medicocenter.com, and receive an individualized assessment based on their current health level and a nutritional plan designed to enhance the quality of their life and well being in the future. If, for example, a consumer has concerns about the onset or worsening of high blood pressure, he or she can engage in an interactive dialogue with the ASP to establish signposts to gauge the extent of the problem in conjunction with their physician. Following
this, a detailed list of preventive measures and chronic treatment support will be provided to allow the consumer alternative choices as to a course of action best suited to their life situation.
Product differentiation
The methodology of empowering the consumer, vis-a-vis their own health needs, broadens the overall health sector knowledge base and allows for intelligent, well thought out courses of action by the consumer when dealing with their professional health provider. Each of the applications is uniquely tailored to the particular needs of that consumer and their areas of concern.
Our on-line medical services will be interactive, a dialogue between the consumer and the applications. Our goal is to position us so that, in the e-healthcare sector, our services are always perceived as being a rich and diverse source of information in a user friendly, interactive, individualized format. The clarity and consistency of that message will be monitored on an ongoing basis so that it meshes seamlessly with the changing needs and concerns of the consumer pool.
There are over 15,000 health-based internet sites as reported by Business 2.0 magazine, in its March 1999 edition. Almost all of these are what Jupiter Communications dubbed "informational" i.e., they are one-way content providers and serve essentially the function of being an electronic medical encyclopedia. A few are transactional such as on-line pharmacies. In this new decade, we expect e-healthcare to adopt new business models and innovate to meet the demands of an industry in need of fundamental change. We believe that the new e-trends emerging in the healthcare industry will have an impact and provide significant investment opportunities.
The ASP systems work as small communication programs, which accumulate data for individuals, including those with multiple problems, through a question and answer interface that is supported by an ASP, much like mimicking the Patient/Doctor interaction. The ASP then accesses our inference engine adding to the knowledge base, which in turn spawns a dynamic ASP ending in a report to the consumer. We are a proprietary Application Service Provider in the Business to Consumer, otherwise known as the "B-2-C" segment. We currently find ourselves alone in this segment of consumer e-healthcare.
One of the large players in e-healthcare is E-MedSoft.com. In June 2000, their website, e-medsoft.com, stated the following:
"E-MedSoft.com provides management systems for health care companies that are accessed through the Internet. The system allows [professional] people in different locations to access health care data from anywhere with an Internet hook-up. It connects all the major [professional] constituents in a health care network,"
The Trizetto Group delivers a third party ASP solution but also in the Business-to-Business, or "B-2-B" segment. Trizetto's website in June 2000 stated:
"Packaged applications only address approximately 70 percent
of the requirements unique to an organization, according to Lu Kabir, senior vice president of marketing and business development at Trizetto. Typically these applications must be modified and integrated to provide optimal benefits to users. According to Kabir, by the time companies complete the implementation, for every dollar they've spent on software licenses, they've spent an additional nine on consulting services."
The major limiting factor in this industry right now is that, at present, these solutions are too expensive for the average consumer. Our applications hope to remedy this situation. Although e-medsoft.com, Trizetto and others may evolve to Business to Business to Consumer (B-2-B-C), we believe that it is somewhat down the line as they are now strategically engaged in putting web front ends onto existing legacy systems as opposed to a fresh start with new proprietary systems designed specifically for the new trends. Significant corporate settlement of healthcare costs may be available to our Medicocenter web site to link our consumers through to professional systems for various payments.
According to Forrester Research, the ASP market is expected to grow to more than $21 billion in 2001. Forrester defines application server as " A software server product that supports thin clients with an integrated suite of distributed computing capabilities." (June 2000). They further note in an article in January 2000 by Bobby Cameron: "The Death Of IT
The IT organization will disappear in successful eBusinesses. To support complex, fast-changing business processes that span multiple companies, firms will disperse technology management across an exT (external technology) environment."
As traditional methods give way, the consumer will have access to systems that, previously, only corporations could afford. In some jurisdictions health "credits" are replacing traditional Medicare/Medicaid systems, whether in part or in total. In this scenario the patients determine where, how and with whom to spend their healthcare funds.
This democratization is further underscored by the following CNN.com report by Daniel Eisenberg, on June 5, 2000, entitled "Curing managed care" the headline and excerpted article reads
" With costs rising and patients rebelling, the prognosis for HMOs isn't so good...
On this day, though, Donaldson, a founder of the investment firm Donaldson, Lufkin & Jenrette and a former chairman of the New York Stock Exchange, was out to present Aetna's new bedside manner. "In response to a real market need, we heartily embraced managed care," he told the crowd. "But there was a price, in terms of too many restrictions and too much process that have grown increasingly unpopular. There are those who say the pendulum has swung too far. I agree."
Since taking over (AETNA U.S. Healthcare) a few months ago from Richard Huber, the combative CEO who was forced out, Donaldson has been trying his best to mend the HMO giant's sickly relations with doctors and members, who view it as putting profits ahead of patients."
As can be seen from the aforementioned report, consumers are seeking alternative choices.
We are keenly aware of the ethical issues involved in healthcare services being sold over the internet but note the following from Wired.com's website this month.
DENVER -- When medical research and business mix it may
raise eyebrows -- if not serious ethical questions
-- but scientists say the two need each other to
ensure that medical advances are delivered to the
public.
"I think it's important to appreciate that there's
an important role at both ends," said Dr. Harry
Malech, head of genetic immunotherapy at the
National Institute of Allergy and Infectious
Disease in Bethesda, Maryland. "There are very few
things that have gone directly from basic science
to being widely available to people in the
community to treat their disease process. Industry
is essential for translating these things."
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There has been a plethora of warnings from non-profit speakers and organizations regarding the sometimes thinly veiled profit motives for "informational sites". We do not prescribe, any drugs, however we do aim to be profitable within a few years.
Marketing and sales
The business model we developed takes into account a number of features of the new consumer empowerment for healthcare:
First; The Forrester report, "Why Doctors Hate the Net, (April 2000) ... comes on the heels of a recent American Medical Association survey that shows fewer than 40 percent of doctors use the Web as part of their practice.
Second; Docs in the Dark Ages by Kristen Philipkoski , Mar.
9, 2000 PST
"Doctors tend to be traditionalists, and that's not good news for e-health businesses hoping to take healthcare to the Internet. ...
More than 100 million consumers are looking to the Internet for health information, but that may not be enough to convince doctors that they need to embrace the Net, according to Dr. Edward Fotsch, president and CEO of the health site Medem. "
Third; Health Information on-line is a huge and growing segment of the Healthcare industry, whose sales are predicted to rise to $10 billion by the year 2004. In the same release (Jupiter Communications Inc. January 2000) reported that 45% of on-line consumers access the Internet for health information.
Fourth; We believe that the consumer "dependency" on the medical system is shifting to a self-directed model as healthcare budgets and patient tolerance erodes.
In Patients, Heal Thyselves by Lindsey Arent May. 20, 1999 PDT states
"If the researchers at the Center for Future Health have their way, your early checkup could be a thing of the past. "
Doctors, engineers, and scientists at the Center for Future Health are creating gizmos to put the diagnostic power of the doctor's office in the hands of patients." and sophisticated, yet simple homecare is enabled
Properties
Our facilities are located in approximately 800 square feet of leased office space in Montreal, Canada. Our lease expires on June 30, 2005, and provides for an annual rental of US$ $18,000. We have only negligible costs relating to environmental compliance laws.
Legal proceedings
We are not involved in any material legal proceedings
Management
Contracts for officers and employees, are being reviewed by legal counsel and have not yet been signed.
Officers and directors
Name Age Title
---- --- -----
Anthony Ierfino 25 President & CEO, Director
Leonard Stella 39 Chief Operating Officer, Director
Dr. Christos Tsoukas, C.M.,M.D., 52 Vice-President - Scientific
F.R.C.P., F.A.C.P Research and Development
Abdulmajid Sharif 25 Chief Technical Officer, Director
Dr. Raafat G. Saade 36 Vice-President - Data Information,
Director
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Mr. Anthony Ierfino, President/CEO - Director
Mr. Ierfino received his Bachelor of Arts degree in Computer Science from Concordia University in 1996. In 1998 he received his Microsoft certificate as a systems Engineer. Mr. Ierfino combines expert knowledge in both Internet servers and Networks. He is highly accomplished in hardware installations, routing, set-up, support, etc. of the above. That being said, his main expertise is in the Security field for both networks and the Internet. He has served as the head of Network Administration for Bell Sygma International, 1997-2000, as well as administration of over 140 Internet Web sites for Mila Consultants, 1996-1997. He also heads his own firm, Payment Central Inc that specializes in security and authorization of both credit card payment and wire transfers via voice recognition.
Mr. Leonard Stella, COO - Director
Mr. Stella has a Bachelor of Arts from McGill University, and received his Graduate Diploma in Hospital Administration from Concordia University. From 1984-1985 he was the assistant administrator of the Mt. Sinai Hospital. In 1986 Mr. Stella founded and operated a residential and commercial property developer, Dominion Certified Development. In 1991, he founded Trans-Immobilia, a residential property company that he continues to run to date. In 1998 he was one of the founding partners and has the position of President and Treasurer of Millenia Hope Inc., a Delaware company, specializing in the biotechnology field, that is publicly traded on the NASD's OTC Bulletin Board. To Sword, he brings his administration and management skills and expertise in working for public companies, and with venture capitalists and public relations firms.
Dr. Christos Tsoukas, Vice President of Research and Development
Dr. Tsoukas received his Bachelor of Science degree from McGill University and his Medical degree from the University of Athens in 1975. In 1982 he was granted a specialization in Immunology from McGill University. Since 1982 he has been a full professor at McGill University. Since 1990, he has been the Associate Director of the McGill AIDS Center. Dr. Tsoukas is considered a leader in the development of clinical trials on AIDS as well as being one of the founders of the HIV treatment unit at the Montreal General Hospital. Also involved with the World Hemophilia Federation, he has been the guest speaker at many international symposia and is the author of many learned publications.
Dr. Raffat G. Saade - Vice President - Data Information - Director
Dr. Saade received his Bachelor of Engineering from Concordia University in 1987. This was followed by his Master's in 1990 and his Ph.D. in Engineering in 1995, all from the same Institution. Dr Saade has broad expertise in computer modeling, expert systems and interactive programming, with emphasis on the fields of health and nutrition. Dr. Saade has worked on a wide variety of projects for several corporations and Universities from 1988 to the present.
These included simulation models for Tecsult Inc. and the Lasalle Consulting Group between 1990-1993, an interactive computer aided learning system for McGill University from 1995-1996 and, more recently, the development of intelligent systems for data interpretation for Imro Medical System in 1997-1998 and a medical decision support system for the Internet for Global Netcare (NASDAQ: OTC BB -GBCR) during 1998 and 1999. In 1999-2000 he was involved with a joint project with Harvard University to develop a risk assessment program for osteoporosis. Dr. Saade has published over 40 reports and projects and lectured to Industry and Universities.
Mr. Abdulmajid Sharif, CTO (Chief Technical Officer)
Mr. Sharif received his Bachelor of Science with honors in Physics and Mathematics from McGill University in 1997. Mr. Sharif has extensive and in-depth knowledge in both the software and hardware areas. He has served as the technology advisor to McGill University; Faculty of Science Computer Taskforce from 1997-1999 as well as the Faculty of Arts Computer Networking from 1997-1999. In 1999 he received his Microsoft certificate as a Systems Engineer and as a professional and Internet expert. Since 1995, Mr. Sharif has worked in various faculties and projects for McGill University. He is an expert in Internet technologies: World Wide Web, FTP, Internet Groupware with a highly specialized expertise in Internet Security. As well, Mr. Sharif has extensive knowledge in the field of networking and the integration of heterogeneous networks.
Indemnification of directors and officers.
Neither our By-Laws nor our Certificate of Incorporation currently provides indemnification to our officers or directors. In an effort to continue to attract and retain qualified individuals to serve as our directors and officers, we intend to adopt provisions providing for the maximum indemnification permitted by Delaware law.
Compensation of directors
Directors do not receive any compensation for services as members of the board of directors.
Security ownership of certain beneficial owners and management
The following table sets forth, as of September 30, 2000, information regarding the beneficial ownership of our common stock based upon the most recent information available to us for
o each person known by us to own beneficially more than five (5%) percent of our outstanding common stock,
o each of our officers and directors and
o all of our officers and directors as a group.
Each stockholder's address is c/o Sword Comp-Soft Inc., 4055 St. Catherine Street West, Suite 133, Montreal, Quebec, CANADA, H3Z 3J8
Number of
Shares Owned
Name Beneficially % of Total
Millenia Hope, Inc. 35,700,000 76.4%
Anthony Ierfino (1) 120,000 *
Leonard Stella (2) 120,000 *
Abdulmajid Sharif (3) 120,000 *
Christos Tsoukas (4) 120,000 *
Raafat Saade (5) 120,000 *
All Officers and Directors
as a Group (5 persons) 600,000 0.0127
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* less than 1%
(1) President and CEO - Director
(2) Chief Operating Officer - Director
(3) Chief Technical Officer - Director
(4) Vice President - Research and Development
(5) Vice President - Data Information - Director
Executive compensation
From our inception on November 2, 1998, through the fiscal year ended April 30, 2000, no compensation was paid to any of our executive officers.
Disclosure of commission position on indemnification for securities act liabilities
Neither our by-laws nor our certificate of incorporation currently provide indemnification to our officers or directors. In an effort to continue to attract and retain qualified individuals to serve as our directors and officers, we intend to adopt provisions providing for the maximum indemnification permitted by Delaware law.
Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons, pursuant to the foregoing provisions, or otherwise, we have been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore unenforceable.
Description of securities
Authorized and outstanding stock
Our authorized capital stock consists of 70,000,000 shares of common stock, $0.0001 par value. As of September 30, 2000 there were 46,700,000 shares outstanding, which were held by 193 stockholders of record.
Common stock
Subject to legal and contractual restrictions on payment of dividends, the holders of common stock are entitled to receive such lawful dividends as may be declared by the board of directors. In the event of our liquidation, dissolution or winding up, the holders of shares of common stock are entitled to receive all of our remaining assets available for distribution to stockholders after satisfaction of all liabilities and preferences. Holders of our common stock do not have any preemptive, conversion or redemption rights and there are no sinking fund provisions applicable to our common stock. Record holders of our common stock are entitled to vote at all meetings of stockholders and at those meetings are entitled to cast one vote for each share of record that they own on all matters on which stockholders may vote.
Stockholders do not have cumulative voting rights in the election of our directors. As a result, the holders of a plurality of the outstanding shares can elect all of our directors, and the holders of the remaining shares are not able to elect any of our directors. All outstanding shares of common stock are fully paid and non-assessable, and all shares of common stock to be offered and sold in this offering will be fully paid and non-assessable.
Transfer agent and registrar
The stock transfer agent and registrar for our common stock is Intercontinental Registry and Stock Transfer, located at 900 Buchanan blvd # 1, Boulder City, Nevada 89005-2100.
Dividend policy
Under applicable law, dividends may only be paid out of legally available funds as proscribed by a statute, subject to the discretion of the board of directors. In addition, it is currently our policy to retain internally generated funds to support future expansion of our business. Accordingly, even if we do generate earnings, and even if we are not prohibited from paying dividends, we do not currently intend to declare or pay cash dividends on our common stock for the foreseeable future
Shares available for future sale
On the date of this prospectus, all 11,000,000 shares included in this prospectus will generally be freely tradable without restriction imposed by, or further registration under, the Securities Act. An additional 35,700,000 shares of our common stock may be deemed "restricted securities," as that term is defined under Rule 144 promulgated under the Securities Act. Such shares may be sold to the public, subject to volume restrictions, as described below. Commencing at various dates, these shares may be sold to the public without any volume limitations.
In general, under Rule 144 as currently in effect, subject to the satisfaction of certain other conditions, a person, including one of our affiliates, or persons whose shares are aggregated with affiliates, who has owned restricted shares of common stock beneficially for at least one year is entitled to sell, within any three-month period, a number of shares that does not exceed 1% of the total number of outstanding shares of the same class. In the event our shares are sold on an exchange or are reported on the automated quotation system of a registered securities association, you could sell during any three-month period the greater of such 1% amount or the average weekly trading volume as reported for the four calendar weeks preceding the date on which notice of your sale is filed with the SEC. Sales under Rule 144 are also subject to certain manner of sale provisions, notice requirements and the availability of current public information about us. A person who has not been one of our affiliates for at least the three months immediately preceding the sale and who has beneficially owned shares of common stock for at least two years is entitled to sell such shares under Rule 144 without regard to any of the limitations described above.
You should note that we anticipate that our shares of common stock will initially be included for quotation on the OTC Bulletin Board. Pursuant to SEC regulations, the OTC Bulletin Board is not considered an "automated quotation system of a registered securities association" and Rule 144 will only permit sales of up to 1% of the outstanding shares during any three-month period.
Plan of distribution
The sale of the shares of common stock by the selling stockholders may be effected by them from time to time in the over the counter market or in such other public forum where our shares are publicly traded or listed for quotation. These sales may be made in negotiated transactions through the timing of options on the shares, or through a combination of such methods of sale, at fixed prices, which may be charged at market prices prevailing at the time of sale, at prices related to such prevailing market prices or at negotiated prices. The selling stockholders may effect such transactions by selling the shares to or through broker-dealers, and such broker-dealers may receive compensation in the form of discounts, concessions or commissions from the selling stockholders and/or the purchasers of the shares for which such broker-dealer may act as agent or to whom they sell as principal, or both. The compensation as to a particular broker-dealer may be in excess of customary compensation.
The selling stockholders and any broker-dealers who act in connection with the sale of the shares hereunder may be deemed to be underwriters within the meaning of Section 2(11) of the Securities Act, and any commissions received by them and any profit on any sale of the shares as principal might be deemed to be underwriting discounts and commissions under the Securities Act.
Selling stockholders
We are registering shares of common stock purchased by investors in our 2000 private placement offerings,
Other than the costs of preparing this prospectus and a registration fee to the SEC, we are not paying any costs relating to the sales by the selling stockholders. Each of the selling stockholders, or their transferees, and intermediaries to whom such securities may be sold may be deemed to be an "underwriter" of the common stock offered in this prospectus, as that term is defined under the Securities Act. Each of the selling stockholders, or their transferees, may sell these shares from time to time for his own account in the open market at the prevailing prices, or in individually negotiated transactions at such prices as may be agreed upon. The net proceeds from the sale of these shares by the selling stockholders will inure entirely to their benefit and not to ours.
Except as indicated below, none of the selling stockholders has held any position or office, or had any material relationship with us or any of our predecessors or affiliates within the last three years, and after completion of this offering will own the amount of our outstanding common stock listed opposite their name. The shares reflected by each selling stockholder is based upon information provided to us by our transfer agent and from other available sources in September 2000.
These shares may be offered for sale from time to time in regular brokerage transactions in the over-the-counter market, or, either directly or through brokers or to dealers, or in private sales or negotiated transactions, or otherwise, at prices related to the then prevailing market prices. Thus, they may be required to deliver a current prospectus in connection with the offer or sale of their shares. In the absence of a current prospectus, if required, these shares may not be sold publicly without restriction unless held by a non-affiliate for two years, or after one year subject to volume limitations and satisfaction of other conditions. The selling stockholders are hereby advised that Regulation M of the General Rules and Regulations promulgated under the Securities Exchange Act of 1934 will be applicable to their sales of these shares. These rules contain various prohibitions against trading by persons interested in a distribution and against so-called "stabilization" activities.
The selling stockholders, or their transferees, might be deemed to be "underwriters" within the meaning of Section 2(11) of the Act and any profit on the resale of these shares as principal might be deemed to be underwriting discounts and commissions under the Act. Any sale of these shares by selling
shareholders, or their transferees, through broker-dealers may cause the broker-dealers to be considered as participating in a distribution and subject to Regulation M promulgated under the Securities Exchange Act of 1934, as amended. If any such transaction were a "distribution" for purposes of Regulation M, then such broker-dealers might be required to cease making a market in our equity securities for either two or nine trading days prior to, and until the completion of, such activity.
Shares Beneficially Shares Beneficially
Owned Owned
Name of Selling Security Holder Before Offering Offering After Offering
------------------------------- --------------- -------- --------------
Jose Sardano 25,000 25,000 0
Mario Volpe 25,000 25,000 0
Claude Auclair 500 500 0
Renee Lapierre 500 500 0
Francois Rochon 1,000 1,000 0
Raoul Bouvin 500 500 0
Roberto Mocella 1,000 1,000 0
Jean Paul Belisle 500 500 0
Cosmo Salerno 100,000 100,000 0
Nino Del bello 50,000 50,000 0
Quantis Ltee 1,000 1,000 0
Sebastien Larochelle 500 500 0
Mrs. Maria Fusco 1,000 1,000 0
Dichro Mgt Consultant Inc. 500 500 0
Denise Larochelle 500 500 0
Bruno Ballarano 500 500 0
Chantal Corbeil 500 500 0
Les Investissements MPS inc. 500 500 0
Jean Pierre Leclerc 500 500 0
Raymond Roy 1,000 1,000 0
Jacques Leclerc 1,500 1,500 0
Christiane Proulx 500 500 0
139472 Canada Inc. 1,000 1,000 0
Kenneth Di Brewen 1,000 1,000 0
Luc Methot 500 500 0
Robert Courtois 1,000 1,000 0
Michel Gagne 500 500 0
Bruno DeLorme 500 500 0
Georges Gagnon 500 500 0
Pierre Poulin 1,000 1,000 0
Gerald Sylvestre 500 500 0
19
|
Dominique Salerno 10,000 10,000 0
Antonio Petrantonio 10,000 10,000 0
Jean Thellen 1,500 1,500 0
Mario Goncalves 1,500 1,500 0
Christian Cardinal 1,000 1,000 0
Richard Panbrun 500 500 0
Collette Fillion 500 500 0
Julie Bastien 500 500 0
Martine Bastien 500 500 0
Lucie Godette 500 500 0
Stephanie Godette 1,000 1,000 0
Joel Chapdelaine 1,500 1,500 0
Celine St-Onge 1,000 1,000 0
Martin St-Onge 500 500 0
Constance Godette 500 500 0
Laurette Borduas 500 500 0
Michel Chapdelaine 1,000 1,000 0
Jean Bastien 500 500 0
Bernard Dallaire 500 500 0
Denise Comptois 1,000 1,000 0
Yves Comptois 500 500 0
Raynald Racicot 1,500 1,500 0
Pierre Nault 1,500 1,500 0
Georges Gagnon 500 500 0
Armand Patenaude 500 500 0
Denis Chicoine 500 500 0
Julia Shaar 500 500 0
Claude Cote 1,000 1,000 0
Andre Corriveau 500 500 0
Yves Cyr 1,000 1,000 0
Maryse Richard 1,000 1,000 0
Jules Chicoine 500 500 0
Langis Charron 500 500 0
Jacques Goyet 500 500 0
Yvan Levesque 500 500 0
Liette Lalonde 1,000 1,000 0
Alain Boyer 500 500 0
Micheline Sawyer 500 500 0
Lyne Barry 500 500 0
Raymond Guitard 1,000 1,000 0
20
|
Montreal Marine Cleaners 1,500 1,500 0
155707 Canada Inc. 500 500 0
Yvon Lambert 500 500 0
Paul Peloquin 500 500 0
Danielle Pontbriand 500 500 0
Gilles Lavalee 500 500 0
Jacqueline Beausoleil 1,000 1,000 0
Fanny Dubuc 1,000 1,000 0
Francois Fregault 500 500 0
Andre Beaulieu 500 500 0
Manon Delisle 1,000 1,000 0
Suzanne Legault 1,500 1,500 0
Michele Lafrancois 1,500 1,500 0
Filippo Vita 500 500 0
Luis Vitorino 500 500 0
Andre Grimard 1,000 1,000 0
Gabriel Lo Russo 1,000 1,000 0
Eric Sardano 1,500 1,500 0
Karine Bastien 500 500 0
Francine Pauze 1,000 1,000 0
Giuliano Ercoli 500 500 0
Suzanne Cormier 500 500 0
M.J. Anny Sardno 500 500 0
Marc Sansregret 500 500 0
Michel Sevigny 1,000 1,000 0
Valerie Tsaroukas 1,000 1,000 0
Sylvain Cournoyer 1,500 1,500 0
Patrick Marcovecchio 60,000 60,000 0
Joe Caruso 500 500 0
Guglielmo Pecorilli 48,000 48,000 0
Leonardo Arcuri 250,000 250,000 0
John Axmit 500 500 0
Michel Bedrossian 15,000 15,000 0
Ines Benedict 5,000 5,000 0
George Benson 500 500 0
Joel T. Bugsy 7,500 7,500 0
Rodney Codmar 500 500 0
Dominico De Angelis 25,000 25,000 0
Burt Delrivo 1,000 1,000 0
21
|
Gloria Delrivo 1,000 1,000 0
Louis Grecco 25,000 25,000 0
Mike Rossi 20,000 20,000 0
Silvio Villeneuve 25,000 25,000 0
Marcel Villeneuve 25,000 25,000 0
Jean Pierre Villeneuve 25,000 25,000 0
Francine Villeneuve 25,000 25,000 0
Perry Choiniere 100,000 100,000 0
Valentin Cimpan 5,000 5,000 0
Gilles Gonier 5,000 5,000 0
Gaspar Stella 25,000 25,000 0
Joanna Stella 25,000 25,000 0
Bianca Stella 25,000 25,000 0
Raffi Bedrossian 50,000 50,000 0
Nicole Riopel 5,000 5,000 0
Patrick Picorelli 50,000 50,000 0
Silvio Rossi 500 500 0
Dr. Rene Morel 150,000 150,000 0
Antonio Vecchiarino 15,000 15,000 0
Francesca Albano 100,000 100,000 0
Yehuda Kops 350,000 350,000 0
Claude Villeneuve 371,500 371,500 0
Roberto Savoca 40,000 40,000 0
Anna Allen 40,000 40,000 0
Giovanna Martorana Magri 8,000 8,000 0
9089-6929 Quebec Inc. 360,000 360,000 0
Ignazio Magri 40,000 40,000 0
Giuseppe Magri 8,000 8,000 0
Maria DiCesare 14,440 14,440 0
Cliff Blass 20,000 20,000 0
Sofia Catalina 9,400 9,400 0
Patricia Fronteira 4,000 4,000 0
Rosario Gioffre 70,000 70,000 0
Denis Ponari 10,000 10,000 0
Anthony Ierfino (1) 120,000 120,000 0
Leonard Stella (2) 120,000 120,000 0
Abdulmajid Sharif (3) 120,000 120,000 0
Raffat Saade (5) 120,000 120,000 0
Christos Tsoukas (4) 120,000 120,000 0
Robert Picorelli 80,000 80,000 0
Ted Roan 50,000 50,000 0
22
|
Somli Holdings 250,000 250,000 0
George Tsoukas 250,000 250,000 0
Sartor Corp. 250,000 250,000 0
Raymond Roy 25,000 25,000 0
Ruben Armenta 10,000 10,000 0
Estere Granata 20,000 20,000 0
PSI International 150,000 150,000 0
Ian Breton 10,000 10,000 0
Jovette Simoneau 25,000 25,000 0
DM Investments 250,000 250,000 0
David Muldor 100,000 100,000 0
Michael Solomita 100,000 100,000 0
Daniel Solomita 50,000 50,000 0
Vincent Solomita 100,000 100,000 0
Joseph Solomita 20,000 20,000 0
Rocco Piccolo 100,000 100,000 0
Myriam Cella 100,000 100,000 0
Josie Gammieno 10,000 10,000 0
Rafael Bitton 80,000 80,000 0
Mike Ghakis 40,000 40,000 0
Marc Dumont 20,000 20,000 0
Dean Cristofaro 60,000 60,000 0
Ivano Delnegro 40,000 40,000 0
Charles Layne 20,000 20,000 0
Mohsen Yadman 20,000 20,000 0
Danny Lamaroux 20,000 20,000 0
Silvana Favero 10,000 10,000 0
Nicholas Skafidas 4,000 4,000 0
Linda Nikolakopoulos 4,000 4,000 0
Rea Pangalo 3,000 3,000 0
Jacques Theriault 3,000 3,000 0
Georgia Florov 8,000 8,000 0
Spiros Fengos 100,000 100,000 0
Giuseppe Castiglione 181,200 181,200
Antonio Arcuri 200,000 200,000 0
Dominico Arcuri 200,000 200,000 0
Nordam Services Ltd. 600 000 600,000 0
9033-0176 Quebec Inc. 819,000 819,000 0
Nestar Trading Inc. 1,089,000 1,089,000 0
Astute Holdings 1,089,000 1,089,000 0
23
|
International Global Investments 1,089,000 1,089,000 0 |
(1) Our President, CEO and a Director
(2) Our COO and a Director
(3) Our CTO and a Director
(4) Our VP of Research and Development
(5) Our VP of Data Information and a Director
Legal matters
Certain legal matters in connection with this offering are being passed upon by the law firm of Heller, Horowitz & Feit, P.C., New York, New York.
Experts
Our audited financial statements as of April 30,2000 and for the fiscal year then ended are included in this prospectus in reliance upon the report of Mark Cohen C.P.A., an independent certified public accountant, and upon the authority of said person as an expert in accounting and auditing.
Available information
Commencing on the date of this prospectus, we will be subject to the information Requirements of the Securities Exchange Act of 1934, as amended. This Act requires us to file reports, proxy statements and other information with the Securities and Exchange Commission. Copies of the reports, proxy statements and other information we file can be inspected at the Headquarters Office of the Securities and Exchange Commission located at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549 and at certain of its regional offices at the following addresses:
o 7 World Trade Center, 13th Floor, New York, New York 10048; and
o 500 West Madison Street, Suite 1400, Chicago, Illinois 60661.
Copies of the material we file may be obtained from the Public Reference Section of the Commission, at 450 Fifth Street, N.W., Room 1024, Washington, D.C. at prescribed rates. The Public Reference Room can be reached at (202) 942-8090. The Commission also maintains a web site that contains reports, proxy and information statements and other information regarding us. This material can be found at http://www.sec.gov.
INDEPENDENT AUDITORS' REPORT
Board of Directors
Sword Comp-Soft Corp.
We have audited the accompanying balance sheet of Sword Comp-Soft Corp. (a company in the development stage) as of April 30, 2000 and the related statements of operations, shareholders' equity (deficiency) and cash flows for the year ended. 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 financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Sword Comp-Soft Corp. at April 30, 2000, and the results of its operations and its cash flows for the year then ended, in conformity with generally accepted accounting principles.
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 5 to the financial statements, the Company has experienced an operating loss that raises substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 5. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/Mark Cohen Mark Cohen C.P.A. A Sole Proprietor Firm Hollywood, Florida July 15, 2000 |
SWORD COMP-SOFT CORP.
(A COMPANY IN THE DEVELOPMENT STAGE)
BALANCE SHEET
AT APRIL 30, 2000
Assets
Current Assets
Cash and cash equivalents $ 151,660
Total current assets 151,660
Property and equipment, net 15,000
Total assets 166,660
=======
Liabilites and Shareholder's Equity
Current Liabilities
Accounts payable -
Accounts payable and accrued liabilities 6,853
Total current liabilities 6,853
Shareholder's Equity
Common Stock, $.0001 par value; authorized 70,000,000 shares; 1,100
issued and outstanding - 11,000,000 in 2000
Paid in Capital 273,901
Share Subscription Receivable (103,739)
Deficit accumulated during the development stage (11,454)
Total Shareholder's Equity 159,807
Total liabilities and shareholder's equity $ 166,660
|
Read the accompanying summary of significant accounting policies and notes to financial statements, both of which are an integral part of this financial statement.
SWORD COMP-SOFT CORP.
(A COMPANY IN THE DEVELOPMENT STAGE)
STATEMENT OF INCOME
FROM INCEPTION (NOVEMBER 02, 1998) THROUGH APRIL 30, 2000
Year Ended
April 30, 2000
--------------------
Operating Expenses:
Selling, general and administrative expenses $ 11,454
Net Loss $ (11,454)
====================
Basic weighted average common shares outstanding 11,000,000
====================
Basic Loss per common share $ (0.0010)
====================
|
Read the accompanying summary of significant accounting policies and notes to financial statements, both of which are an equal part of this financial statement.
SWORD COMP-SOFT CORP.
(A COMPANY IN THE DEVELOPMENT STAGE)
STATEMENT OF SHAREHOLDERS' EQUITY
FROM INCEPTION (NOVEMBER 02, 1998) THROUGH APRIL 30, 2000
Accumulated
Common Stock Receivables Deficit during Total
---------------------------------------------- Paid in Shares Development Shareholder's
Shares Par Value Amount Capital Subscription Stage Equity
---------------- -------------- ------------ -------------- ------------------------------- ---------------
- $ - $ - $ - $ - $ - $ -
10,400,000 0.0001 1,040 258,961 (103,739) - 156,262
600,000 0.0001 60 14,940 - - 15,000
(11,454) (11,454)
---------------- -------------- ------------ -------------- --------------- -------------- ---------------
11,000,000 $ 0.001 $ 1,100 $ 273,901 $ (103,739) $ (11,454) $ 159,807
================ ============== ============ ============== =============== ============== ===============
|
Read the accompanying summary of significant policies and notes to financial statement, both of which are an integral part of this financial statement.
SWORD COMP-SOFT CORP.
(A COMPANY IN THE DEVELOPMENT STAGE)
STATEMENT OF CASH FLOWS
FROM INCEPTION (NOVEMBER 02, 1998) THROUGH APRIL 30, 2000
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income (Loss) $ (11,454)
Adjustments to reconcile net income (loss) to net cash -
used in operating activities:
Changes in Operating assets and liabilities:
Accounts Payable and Accrued Liabilities 6,853
----------------
Net cash provided by/(used in) operating activities (4,602)
|
CASH FLOWS FROM INVESTING ACTIVITIES:
Net cash provided by/(used in) investing activities -
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from:
Sales of common stock 156,262
----------------
Net cash provided by/(used in) financing activities 156,262
----------------
Net increase (decrease) in cash and cash equivalents 151,660
Cash and cash equivalents, beginning of period -
----------------
Cash and cash equivalents, end of period $ 151,660
================
|
Read the accompanying summary of significant accounting policies and notes to financial statement, both of which are an integral part of this financial statement.
SWORD COMP-SOFT CORP.
NOTES TO THE FINANCIAL STATEMENTS
FROM INCEPTION (NOVEMBER 02, 1998) THROUGH APRIL 30, 2000
NOTE 1 - ORGANIZATION AND BASIS OF PRESENTATION
Sword Comp-Soft Corp. (the "Company") was organized on November 02, 1998. The company is an Application Service Provider in the E-Health sector providing on-line interactive health services through the internet.
Sword Comp-Soft Corp. prepares its financial statements in accordance with generally accepted accounting principles. This basis of accounting involves the application of accrual accounting; consequently, revenues and gains are recognized when earned, and expenses and losses are recognized when incurred. Financial statement items are recorded at historical cost and may not necessarily represent current values.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Certain amounts included in the financial statements are estimated based on currently available information and management's judgment as to the outcome of future conditions and circumstances. Changes in the status of certain facts or circumstances could result in material changes to the estimates used in the preparation of financial statements and actual results could differ from the estimates and assumptions. Every effort is made to ensure the integrity of such estimates.
Fair value of Financial Instruments
The carrying amounts reported in the balance sheet for cash and cash equivalents, accounts receivable, other receivables, accounts payable and accrued expenses and other liabilities approximate fair value because of the immediate or short-term maturity of these financial instruments.
Earnings Per Share of Common Stock
Basic earnings (loss) per share is computed using the weighted-average number of common shares outstanding during the period.
Statement of Cash Flows
For purposes of the statement of cash flows, the Company considers all highly liquid instruments with original maturities of three months or less to be cash equivalents.
SWORD COMP-SOFT CORP.
NOTES TO THE FINANCIAL STATEMENTS
FROM INCEPTION (NOVEMBER 02, 1998) THROUGH APRIL 30, 2000
NOTE 3 - PROPERTY AND EQUIPMENT, NET
Property and equipment, net consists of the following:
Computer Equipment. . . . . . . . . . . . . . . . . . . . . . . $ 15,000
(Acquired from related party and recorded at
predecessor basis) 15,000
Less: Accumulated depreciation. . . . . . . . . . . . . . . . -
Property and equipment, net. . . . . . . . . . . . . . . . $ 15,000
|
Property and equipment are stated at cost. Depreciation is computed primarily using the straight-line method over the following estimated useful lives:
Computer Equipment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
NOTE 4 - COMMITMENTS AND CONTIGENCIES
Dedicated internet access
The company has entered into an agreement with UUNET Canada, Inc. for
dedicated access to the commercial internet. The agreement is for twelve months
starting March 01, 2000 and expiring on February 28, 2001. The monthly amount is
$1,395 CAD plus applicable taxes.
Office Rent
The company has entered into an lease agreement with 9033-0176 Quebec Inc.
for office space. The term of the lease begins on May 01, 2000 and terminates on
June 30, 2005, with an option to renew for an additional five years. The annual
rent amount is $18,000.
NOTE 5 - GOING CONCERN
The accompanying financial statements have been prepared assuming the Company will continue as a going concern. The company reported a net loss of $11,454 for the year ended April 30, 2000. As reported on the statement of cash flows, the Company incurred negative cash flows from operating activities of $4,602 from inception. To date, this has been financed principally through the sale of common stock ($151,660). Management has continued to develop a strategic plan to develop a management team, maintain reporting compliance and seek new expansive areas in on-line healthcare sector. Management anticipates that additional investments will be needed to develop an effective sales and marketing program before the organization will generate sufficient cash flow from operations to meet current operating expenses and overhead.
NOTE 6 - RELATED PARTY TRANSACTIONS
Equipment purchases from officers
On April 30, 2000 the company purchased computer equipment from its officers. The amount of the purchase was $15,000. On April 30, 2000, the company issued 600,000 shares of common stock in settlement of the purchase. The computer equipment was capitalized at predecessor cost for an amount of $15,000.
SWORD COMP-SOFT CORP.
NOTES TO THE FINANCIAL STATEMENTS
FROM INCEPTION (NOVEMBER 02, 1998) THROUGH APRIL 30, 2000
NOTE 7 - STOCKHOLDER'S EQUITY
On April 30,2000, the company in accordance with its private placement offering exempt from registration requirements under section 4(2) of the Securities Act of 1933 issued 10,400,000 of common shares. The shares have been issued and a receivable has been reflected in the equity section for those shares which payment had not been received as of April 30, 2000.
On April 30, 2000, the company issued 600,000 shares to officers of the company in settlement of computer equipment purchases. The computer equipment was capitalized at predecessor cost for an amount of $15,000.
NOTE 8 - INCOME TAXES
The Company did not provide any current or deferred United States federal, state or foreign income tax provision or benefit for the period presented because it has experienced operating losses since inception. The Company has provided a full valuation allowance on the deferred tax asset, consisting primarily of net operating loss carryforwards, because of uncertainty regarding its realizability.
NOTE 9 - SUBSEQUENT EVENTS
On March 14, 2000 the company agreed to issue 35,700,000 shares, approximately fifty one percent of the authorized shares, of common stock to Millenia Hope, Inc., a biopharmaceutical corporation. On May 29, 2000 the company issued 35,700,000 shares of common stock to Millenia Hope, Inc. in exchange for 5 million shares of common stock of Millenia Hope, Inc. and 5 million warrants, each warrant entitling the company to purchase one common share at a price of two dollars per share until November 30, 2004.
In May and June 2000, the company collected the entire share subscription receivable (see Note 7) of $103,739.
You should only rely on the information contained in this document or other information that we refer you to. We have not authorized anyone to provide you with any other information that is different . You 11,000,000 Shares of should note that even though you received a copy Common Stock of this Prospectus, there may have been changes in our affairs since the date of this Prospectus. This Prospectus does not constitute an offer to sell securities in any jurisdiction in which such offer or solicitation is not authorized |
TABLE OF CONTENTS PAGE
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 13. Other Expenses of Issuance and Distribution
The following statement sets forth the estimated expenses in connection with the offering described in the Registration Statement, all of which will be borne by the Registrant.
Securities and Exchange Commission Fee........... $ 83
Accountants' Fees................................................ $ 15,000
Legal Fees............................................................ $ 20,000
Company's Administrative Expenses................... $ 30,000
Printing and engraving......................................... $ 10,000
Miscellaneous....................................................... $ 1,917
Total $ 77,000
=========
|
Item 14. Indemnification of Directors and Officers.
Neither our By-Laws nor our Certificate of Incorporation currently provide indemnification to our officers or directors. In an effort to continue to attract and retain qualified individuals to serve as our directors and officers, we intend to adopt provisions providing for the maximum indemnification permitted by Delaware law.
Item 15. Recent Sales of Unregistered Securities
In March/April 2000 Registrant sold 11,000,000 common shares at a price of $0.25 under Rule 504 and Regulation S.
In May 2000 Registrant swapped 35,700,000 common shares with its parent company, Millenia Hope Inc. In return it received 5,000,000 common shares of Millenia Hope Inc. and 5,000,000 warrants entitling them to purchase one common share per one warrant for $2 up to May 29, 2003.
Item 16. Exhibits and Financial Statements Schedules.
3.1 Certificate of Incorporation, as amended
3.2 By-Laws
4.1 Specimen Common Stock Certificate
5 Opinion of Heller, Horowitz & Feit, P.C.
10.1 Lease Agreement
23.1 Consent of Heller, Horowitz & Feit, P.C.
(included in the Opinion filed as Exhibit 5)
23.2 Consent of Mark Cohen, C.P.A.
27 Financial data schedule, as amended
|
II-II
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which it offers or sells securities, a post-effective amendment to this registration statement to:
(i) Include any prospectus required by section 10(a)(3) of the Securities Act;
(ii) Reflect in the prospectus any facts or events which, individually or together, represent a fundamental change in the information in the registration statement; and notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high and of the estimated maximum offering range may be reflected in the form of prospectus filed with Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement.
(iii) Include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the registration statement is on Form S-3, Form S-8 or Form F-3, and the information required to be included in post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Commission by the registrant pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement.
(iv) Include any additional or changed material information on the plan of distribution.
(2) For determining liability under the Securities Act, treat each post-effective amendment as a new registration statement of the securities offered and the offering of the securities at that time to be the initial bona fide offering.
(3) File a post-effective amendment to remove from registration any of the securities that remain unsold at the end of the offering.
II-III
In accordance with the requirements of the Securities Act, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements of filing on Form SB-2 and has authorized this registration statement or amendment to be signed on its behalf by the undersigned, in the City of Montreal on the 17th day of October, 2000.
SWORD COMP-SOFT INC.
By:___________________________________________
Anthony Ierfino, President and CEO
In accordance with the requirements of the Securities Act, this registration statement or amendment was signed by the following persons in the capacities and on the dates stated:
Signature Title Date
/s/Anthony Ierfino
Anthony Ierfino President, Chief October 17, 2000
Executive Officer, Director
/s/Leonard B. Stella
Leonard B. Stella Chief Operating Officer, October 17, 2000
Director
/s/Abdulmajid Sharif Chief Technical Officer, October 17, 2000
Abdulmajid Sharif Director
/s/Dr. Raafat G. Saade Vice President October 17, 2000
Dr. Raafat G. Saade Data Information
II-IV
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Exhibit 3.1
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 09:00 AM 11/02/1998
981421973-2961841
CERTIFICATE OF INCORPORATION, AS AMENDED
OF
SWORD COMP-SOFT CORP.
FIRST. The name of this corporation shall be:
SWORD COMP-SOFT CORP.
SECOND. Its registered office in the State of Delaware is to be located at 1013 Centre Road, in the City of Wilmington, County of New Castle, 19805, and its registered agent at such address is THE COMPANY CORPORATION.
THIRD. The purpose or purposes of the corporation shall be:
To engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of Delaware.
FOURTH. The total number of shares of stock which this corporation is authorized to issue is:
Seventy Million (70,000,000) shares without par value.
FIFTH. The name and mailing address of the incorporator is as follows:
Neysa Webb
The Company Corporation
1013 Centre Road
Wilmington, DE 19809
SIXTH. The board of directors shall have the power to adopt, amend or repeal the by-laws.
Exhibit 3.2
BY - LAWS
OF
SWORD COMP-SOFT CORP.
ARTICLE I - OFFICES
SECTION 1. REGISTERED OFFICE. The registered office shall be established and maintained at 721 S.E. 17th Street, suite 200, Fort Lauderdale in the state of Florida.
SECTION 2. OTHER OFFICES. The corporation may have other offices, either within or without the State of Delaware, at such place or places as the Board of Directors may from time to time appoint or the business of the corporation may require.
ARTICLE II - MEETING OF STOCKHOLDERS
SECTION I. ANNUAL MEETINGS. Annual meetings of stockholders for the election of directors and for such other business as may be stated in the notice of the meeting, shall be held at such place, either within or without the State of Delaware, and at such time and date as the Board of Directors, by resolution, shall determine and as set forth in the notice of the meeting. In the event the Board of Directors fails to so determine the time, date and place of meeting, the annual meeting of stockholders shall be held at the registered office of the corporation in Florida on 721 S.E. 17th Street, suite 200, Fort Lauderdale.
If the date of the annual meeting shall upon a legal holiday, the meeting shall be held on the next succeeding business day. At each annual meeting, the stockholders entitled to vote shall elect a Board of Directors and may transact such other corporate business as shall be stated in the notice of the meeting.
SECTION 2. OTHER MEETINGS. Meetings of stockholders for any purpose other than the election of directors may be held at such time and place, within or without the State of Delaware, as shall be stated in the notice of the meeting.
SECTION 3. VOTING. Each stockholder entitled to vote in accordance with the terms and provisions of the Certificate of Incorporation and these By-Laws shall be entitled to one vote, in person or by proxy, for each share of stock entitled to vote held by such stockholder, but no proxy shall be voted after three years from its date unless such proxy provides for a longer period. Upon the demand of any stockholder, the vote for directors and upon any question before the meeting shall be by ballot. All elections for directors shall be decided by majority vote except as otherwise provided by the Certificate of Incorporation or the laws of the State of Delaware.
SECTION 4. STOCKHOLDER LIST.The officer who has charge of the stock ledger of the corporation shall at least 10 days before each meeting of stockholders prepare a complete alphabetical addressed list of the stockholders entitled to vote at the ensuing election, with the number of shares held by each. Said list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten days prior to the meeting, either at a place within the city where the meeting is to be held. Which place shall be specified in the notice of the meeting, or, if not so specified, at the place where the meeting is to be held. The list shall be available for inspection at the meeting.
SECTION 5. QUORUM. Except as otherwise required by law, by the Certificate of Incorporation or by these By-Laws, the presence, in person or by proxy, of stockholders holding twenty percent (20 %) of the stock of the corporation entitled to vote shall constitute a quorum at all meetings of the stockholders. In case a quorum shall not be present at any meeting, a majority in interest of the stockholders entitled to vote thereat, present in person or by proxy, shall have power to adjourn the meeting from time to time, without notice other than announcement at the meeting, until the requisite amount of stock entitled to vote shall be present. At any such adjourned meeting at which the requisite amount of stock entitled to vote shall be represented, any business may be transacted which might have been transacted at the meeting as originally noticed; but only those stockholders entitled to vote at the meeting as originally noticed shall be entitled to vote at any adjournment or adjournment thereof.
SECTION 6. SPECIAL MEETINGS. Special meetings of the stockholders, for any purpose, unless otherwise prescribed by statute or by the Certificate of Incorporation, may be called by the president and shall be called by the president or secretary at the request in writing of a majority of the directors or stockholders entitled to vote. Such request shall state the purpose of the proposed meeting.
SECTION 7. NOTICE OF MEETINGS. Written notice, stating the place, date and time of the meeting, and the general nature of the business to be considered, shall be given to each stockholder entitled to vote thereat at his address as it appears on the records of the corporation, not less than ten nor more than fifty days before the date of the meeting.
SECTION 8. BUSINESS TRANSACTED. No business other than that stated in the notice shall be transacted at any meeting without the unanimous consent of all the stockholders entitled to vote threat.
SECTION 9. ACTION WITHOUT MEETING. Except as otherwise provided by the Certificate of Incorporation, whenever the vote of stockholders at a meeting thereof is required or permitted to be taken in connection with any provisions of the statutes or the Certificate of Incorporation or these By-Laws, the meeting and vote of stockholders who would have been entitled by vote upon the action if such meeting were held, shall consent in writing to such corporate action being taken.
ARTICLE III - DIRECTORS
SECTION 1. NUMBER AND TERM. The number of directors shall be three (3).
The directors shall be elected at the annual meeting of the stockholders and
each directors shall be elected to serve until his successor shall be elected
and shall qualify. The number of directors nay not be less than three (3) except
where all the shares of the corporation are owned beneficially and of record by
either one or two stockholders, the number of directors may be less than three
(3) but not less than the number of stockholders.
SECTION 2. RESIGNATIONS. Any director, member of a committee or other officer may resign at any time. Such resignation shall be made in writing, and shall take effect at the time specified therein, and if no time be specified, at the time of its receipt by the President or Secretary. The acceptance of a resignation shall not be necessary to make it effective.
SECTION 3. VACANCIES. If the office of any director, member of a committee or other officer becomes vacant, the remaining directors in office, though less than a quorum by a majority vote, may appoint any qualified person to fill such vacancy, who shall hold office for unexpired term and until his successor shall be duly chosen.
SECTION 4. REMOVAL. Any director or directors may be removed either for or without cause at any time by the affirmative vote of the holders of a majority of all the shares of stock outstanding and entitled to vote, at a special meeting of the stockholders called for a purpose and the vacancies thus created may be filled at the meeting held for the purpose of removal, by the affirmative vote of a majority in interest of the stockholders entitled to vote.
SECTION 5. INCREASE OF NUMBER. The number of directors may be increased by amendment of these By-Laws by the affirmative vote of a majority of the directors, though less than a quorum, or, by the affirmative vote of a majority in interest of the stockholders, at the annual meeting or at a special meeting called for that purpose, and by like vote the additional directors may be chosen at such meeting to hold office until the next annual election and until their successors are elected and qualify.
SECTION 6. COMPENSATION. Directors shall not receive any stated salary for their services as directors or as a member of committees, but by resolution of the board a fixed fee and expenses of attendance may be allowed for attendance at each meeting. Nothing herein contained shall be construed to preclude any director from serving the corporation in any other capacity as an officer, agent or otherwise, and receiving compensation thereof.
SECTION 7. ACTION WITHOUT MEETING. Any action required or permitted to
be taken at any meeting of the Board of Directors, or any committee thereof, may
be taken without a meeting, if prior to such action a written consent thereto is
signed by all members of the board, or such committee as the case may be, and
such written consent is filed with the minutes of proceedings of the board or
committee.
ARTICLE IV - OFFICERS
SECTION 1. OFFICERS. The officers of the corporation shall consist of a President, a Treasurer, and a Secretary, and shall be elected by the Board of Directors and shall hold office until their successors are elected and qualified. In addition, the Board of Directors may elect a Chairman, one or more Vice-Presidents and such Assistant Secretaries and Assistant Treasurers as it may deem proper. None of the officers of corporation need be directors. The officers shall be elected at the first meeting of the Board of Directors after each annual meeting. More than two offices may be held by the same person.
SECTION 2. OTHER OFFICERS AND AGENTS.The Board of Directors may appoint such officers and agents as it may deem advisable, who shall hold their offices for such terms and shall exercise such power and perform such duties as shall be determined from time to time by the Board of Directors.
SECTION 3. CHAIRMAN. The Chairman of the Board of Directors if one be elected, shall preside at all meeting of the Board of Directors and he shall have and perform such other duties as from time to time may be assigned to him by the Board of Directors.
SECTION 4. PRESIDENT. The President shall be the chief executive officer of the corporation and shall have the general powers and duties of supervision and management usually vested in the office of President of a corporation. He shall preside at all meeting of the stockholders if present thereat, and in the absence or non-election of the Chairman of the Board of Directors, at all meeting of the Board of Directors, and shall have general supervision, direction and control of the business of the corporation. Except as the Board of Directors shall authorize the execution thereof in some other manner, he shall execute bonds, mortgages, and other contracts in behalf of the corporation, and shall cause the seal to be affixed to any instrument requiring it and when so affixed the seal shall be attested by the signature of the Secretary or the Treasurer or an Assistant Secretary or an Assistant Treasurer.
SECTION 5. VICE-PRESIDENT. Each Vice-President shall have such powers and shall perform such duties as shall be assigned to him by the directors.
SECTION 6. TREASURER. The Treasurer shall have the custody of the corporate funds and securities and shall keep full and accurate account of receipts and disbursements in books belonging to the corporation. He shall deposit all moneys and other valuables in the name and to the credit of the corporation in such depositories as may be designated by the Board of Directors.
The Treasurer shall disburse the funds of the corporation as may be ordered by the Board of Directors, or the President, taking proper vouchers for such disbursements. He shall render to the President and Board of Directors at the regular meetings of the Board of Directors, or whenever they may request it, an account of all his transactions as Treasurer and of the financial condition of the corporation. If required by the Board of Directors, he shall give the corporation a bond for the faithful discharge of his duties in such amount and with such surety as the board shall prescribe.
SECTION 7. SECRETARY. The Secretary shall give, or cause to be given, notice of all meetings of stockholders and directors, and all other notices required by law or by these By-Laws, and in case of his absence or refusal or neglect so to do, any such notice may be given by any person thereunto directed by the President, or by the directors, or stockholders, upon whose requisition the meeting is called as provided in these By-Laws. He shall record all the proceedings of the meetings of the corporation and of directors in a book to be kept for that purpose. He shall keep in safe custody the seal of the corporation, and when authorized by the Board of Directors, affix the same to any instrument requiring it, and when so affixed, it shall be attested by his signature or by the signature of any assistant secretary.
SECTION 8. ASSISTANT TREASURERS & ASSISTANT SECRETARIES. Assistant Treasurers and Assistant Secretaries, if any, shall be elected and shall have such powers and shall perform such duties as shall assigned to them, respectively, by the directors.
ARTICLE V
SECTION 1. CERTIFICATES OF STOCK. Every holder of stock in the corporation shall entitled to have a certificate, signed by, or in the name of the corporation by, the chairman or vice-chairman of the board of directors, or the president or a vice-president and the treasurer or an assistant treasurer, or the secretary of the corporation, certifying the number of shares owned by him in the corporation. If the corporation shall be authorized to issue more than one class of stock or more than one series of any class, the designations, preferences and relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations, or restrictions of such preferences and/or rights shall be set forth in full or summarized on the face or back of the certificate which the corporation shall issue to represent such class or series of stock, provided that, except as other wise provided in section 202 of the General Corporation Law of Delaware, in lieu of the foregoing requirements, there may be set forth on the face or back of the certificate which the corporation shall issue to represent such class or series of stock, a statement that the corporation will furnish without charge to each stockholder who requests the powers, designations, preferences and relative, participating, optional or other special rights of each class of stock of such preferences and/or rights. Where a certificate is countersigned (1) by a transfer agent other than the corporation or its employee, or (2) by a registrar other than the corporation or its employee, the signatures of such directors may be facsimiles.
SECTION 2. LOST CERTIFICATES. New certificates of stock may be issued in the place of any certificate therefore issued by the corporation, alleged to have been lost or destroyed, and the directors may, in their discretion, require the owner of the lost or destroyed certificate or his legal representatives, to give the corporation a bond, in such sum as they may direct, not exceeding double the value of the stock, to indemnify the corporation against it on account of the alleged loss of any such new certificate.
SECTION 3. TRANSFER OF SHARES. The shares of stock of the corporation shall be transferable only upon its books by the holders thereof in person or by their duly authorized attorneys or legal representatives, and upon such transfer the old certificates shall be surrendered to the corporation by the delivery thereof to the person in charge of the stock and transfer books and ledgers, or to such other persons as the directors may designate, by who they shall be cancelled, and new certificates shall thereupon be issued. A record shall be made of each transfer and whenever a transfer shall be made for collateral security, and not absolutely, it shall be so expressed in the entry of the transfer.
SECTION 4. STOCKHOLDERS RECORD DATE. In order that the corporation may determine the stockholders entitled to notice of or vote at any meeting of stockholders or any adjournment thereof, or to express consent to corporate action in writing without a meeting, or entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of stock or for the purpose of any other lawful action, the Board of Directors may fix, in advance, a record date, which shall not be more than sixty nor less than ten days before the day of such meeting, nor more than sixty days prior to any other action. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for the adjourned meeting.
SECTION 5. DIVIDENDS. Subject to the provisions of the Certificate of Incorporation the Board of Directors may, out of funds legally available thereof at any regular or special meeting, declare dividends upon the capital stock of the corporation as and when they deem expedient. Before declaring any dividends there may be set apart out of any funds of the corporation available for dividends, such sum or sums as the directors from time to time in their discretion deem proper working capital or as a reserve fund to meet contingencies or for equalizing dividends or for such other purposes as the directors shall deem conducive to the interests of the corporation.
SECTION 6, SEAL. The corporate seal shall be circular in form and shall contain the name of the corporation, the year of its creation and the worlds "CORPORATE SEAL DELAWARE". Said seal may be used by causing it or a facsimile thereof to be impressed or affixed or otherwise reproduced.
SECTION 7. FISCAL YEAR. The fiscal year of the corporation shall be determined by resolution of the Board of Directors.
SECTION 8. CHECKS. All checks, drafts, or other orders for the payment of money, notes or other evidences of indebtedness issued in the name of the corporation shall be signed by the officer or officers, agent or agents of the corporation, and in such manner as shall be determined from time to time by resolution of the Board of Directors.
SECTION 9. NOTICE AND WAIVER OF NOTICE. Whenever any notice is required by these By-Laws to be given, personal notice is not meant unless expressly stated, and any notice so required shall be deemed to be sufficient if given by depositing the same in the United States mail, postage prepaid, addressed to the person entitled thereto at his address as it appears in the records of the corporation, and such notice shall be deemed to have been given on the day of such mailing. Stockholders not entitled to vote shall not be entitled to receive notice of any meetings except as otherwise provided by statute.
Whenever any notice whatever is required to be given under the provisions of any law, or under the provisions of the Certificate of Incorporation of the corporation or these By-Laws, a waiver thereof in writing signed by the person or persons entitled to said notice, whether before or after the time stated therein, shall be deemed proper notice.
ARTICLE VI - CLOSE CORPORATIONS : MANAGEMENT BY SHAREHOLDERS
If the certificate of Incorporation of the corporation states that the business and affairs of the corporation shall be managed by the shareholders of the corporation rather than by a board of directors, then, whenever the context so requires the shareholders of the corporation shall be deemed the directors of the corporation for purpose of applying any provision of these By-Laws.
ARTICLE VII - AMENDMENTS
These By-Laws may be altered and repealed and By-Laws may be made at any annual meeting of the stockholders or at any special meeting thereof if notice thereof is contained in the notice of such special meeting by the affirmative vote of a majority of the stock issued and outstanding or entitled to vote thereat, or by the regular meeting of the Board of Directors, at any regular meeting of the Board of Directors, or at any special meeting of the Board of Directors, if notice is contained in the notice of such special meeting.
Exhibit 4.1
FORM COMMON STOCK CERTIFICATE
SWORD COMP-SOFT CORP.
Incorporated under the Laws of the State of Delaware Authorized Capital Stock 70,000,000 Shares Common Stock Par Value $0.0001
No. Shares
CUSIP _____________
THIS CERTIFIES THAT IS THE OWNER OF
Fully paid and non-assessable shares of SWORD COMP-SOFT CORP. Common Stock transferable only on the books of the Corporation, in person or by duly authorized attorney upon surrender of this Certificate properly endorsed. This Certificate and the shares represented hereby are issued and shall be held subject to all of the provisions of the Certificate of Incorporation and the Bylaws of this Corporation, and all amendments thereto, copies of which are on file at the principal office of this Corporation. In Witness Whereof, the said Corporation has caused this Certificate to be signed by the facsimile signatures of its duly authorized officers and to be sealed with the facsimile seal of this Corporation. This Certificate is not valid unless countersigned by the Transfer Agent and registered by the Registrar.
WITNESS the facsimile seal of the Corporation and the facsimile signatures of its duly authorized officers.
Dated:
[SEAL]
/s/ /s/ Secretary President |
Countersigned Intercontinental Registrar and Trust Agency, Inc.
By:_______________________________________ Transfer Agent and Registrar Authorized Person
Reverse Side of Stock Certificate
Signatures must be guaranteed by a firm which is a member of a registered national stock exchange; or by a bank or a trust company. The following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they were written out in full according to applicable laws or regulations.
TEN COM - as tenants in common UNIF FIT MIN ACT-________Custodian__________
(Cust) (Minor)
TEN ENT - as tenants by the
entireties under Uniform Gifts to Minors
JT TEN - as joint tenants with right of Act__________________________ survivorship and not as tenants in common (State)
Additional abbreviations may also be used though not in the above list.
For Value Received,_____________________________hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
__________________________________________________________ shares
of the capital stock represented by the within Certificate, and do hereby irrevocably constitute and appoint ______________________ Attorney to transfer the said stock on the books of the within named Corporation with full power of substitution in the premises.
Dated_________________________
October 19, 2000
Sword Comp - Soft corp.
4055 St. Catherine Street
Suite 142
Montreal, H3Z 3J8 Quebec
Gentlemen:
As counsel for your Company, we have examined your Articles of Incorporation, By-Laws, and such other corporate records, documents and proceedings and such questions of law as we have deemed relevant for the purpose of this opinion.
We have also, as such counsel, examined the Registration Statement (the "Registration Statement") of your Company on Form SB-2, covering the registration under the Securities Act of 1933, as amended, of the proposed offer and resale of up to 11,000,000 shares of Common Stock by the holders thereof (the "Common Shares"). Our review has included the exhibits and form of prospectus for the resale of the Common Shares.
On the basis of such examination, we are of the opinion that:
1. The Company is a corporation duly authorized and validly existing and in good standing under the laws of the State of Delaware, with corporate power to conduct the business which it conducts as described in the Registration Statement.
2. The Common Shares have been duly and validly authorized and issued and are fully paid and non-assessable shares of Common Stock of the Company.
This opinion is limited to the federal laws of the United States and the General Corporation Law of the State of Delaware.
We hereby consent to the filing of this opinion as an exhibit to the Registration Statement.
Very truly yours,
/s/Heller, Horowitz & Feit, P.C. HELLER, HOROWITZ & FEIT, P.C. |
HH&F:rs
AGREEMENT OF LEASE
signed on April 26,2000
between
9033-0176 Quebec inc
(the "Lessor")
and
SWORD COMP-SOFT.
(the "Lessee")
Table of contents
titles
PARTIES
Article 1 ESSENTIAL DISPOSITIONS, DEFINITIONS AND INTENT Article 2 LEASE AND
DELIVERY OF LEASED PREMISES Article 3 SERVICES FURNISHED TO THE LESSEE Article 4
RENT Article 5 USE AND MAINTENANCE OF LEASED PREMISES Article 6 LEASEHOLD
IMPROVEMENTS Article 7 ACCESS BY LESSOR TO LEASED PREMISES Article 8 DAMAGE AND
DESTRUCTION Article 9 EXPROPRIATION Article 10 DAMAGES Article 11 SIGNS AND
ADVERTISING Article 12 COMPLIANCE WITH LAWS AND INDEMNIFICATION Article 13
SUBLET AND ASSIGNMENT Article 14 ASSIGNMENT BY LESSOR Article 15 DEFAULT AND
RECOURSE Article 16 NOTICE 22 Article 18 TERMINATION OF LEASE Article 19
UNAVOIDABLE DELAY Article 20 MODIFICATION OF LEASE AND PERFORMANCE BY A THIRD
PARTY Article 21 MISCELLANEOUS Article 22 REGULATIONS Article 23 SPECIAL
PROVISIONS/SCHEDULES
SCHEDULES SCHEDULE "A" REGULATIONS SCHEDULE "B" LESSEE'S RESOLUTION |
AGREEMENT OF LEASE
BETWEEN: 9033-0176 Quebec inc., a company duly incorporated under the laws
of the Province of Quebec, having its head office at 634
Louviere, Vimont, Laval, H7W 5G7, hereinacting and represented
by, Leasing Director, duly authorised for the purposes hereof, as
they so declare;
(hereinafter referred to as the "Lessor")
AND: SWORD COMP-SOFT CORP., a company duly incorporated under the law
of Delaware United States, having its head office at 4055 ST.
Catherine w., Westmount, Quebec H3Z 3J8 herein acting and duly
represented by Leonard Stella, its COO duly authorised for the
purposes hereof, as declared and as more fully set forth in the
resolution attached hereto as Schedule "B";
|
(hereinafter referred to as the "Lessee")
THE PARTIES HEREBY MUTUALLY AGREE AS FOLLOWS:
ARTICLE 1
ESSENTIAL DISPOSITIONS, DEFINITIONS AND INTENT
1.1 Essential dispositions - Following are certain essential dispositions of the Lease which are further acknowledged in the Lease:
1.1.1 LEASED PREMISES: means premises of an approximate area of
eight hundred square feet (800 sq. ft.) ("Leasable Area of
the Leased Premises identified as premises number 133
("Leased Premises") of the building located 4055 St.
Catherine w., Westmount, Quebec, H3Z 3J8 ("Building").
1.1.2 TERM: the period ("Term") beginning , the first of May 2000
or the date on which the Lessee takes possession of the
Leased Premises, understanding the earliest of the two dates
("Commencement of the Lease"), and terminating June 30th,
2005 ("Termination of Lease"), unless the Lessee exercises
its option (s) to renew the Lease provided in article 1.1.8
(Special Provisions) of the Lease, in which case the Lease
shall terminate June 30th, 2010.
1.1.3 USE OF THE LEASED PREMISES : the Leased Premises shall be
used for no other purpose than office purposes.
|
1.1.4 ANNUAL RENT : Throughout the Term, an annual guaranteed rent |
equal to :
- for the period commencing on May 1st, 2000 and
terminating on June 30th, 2005, an annual rent of
$18,000 US, payable in advance, in equal monthly and
consecutive installments of $1,500 US each, on the
first day of each month during for this period, based
on a net rate of twenty-two, fifty US per square foot
($22.50 US/sq. ft.) of the Leasable Area of the Leased
Premises;
- The Annual Rent is payable to the Lessor in accordance
to article 4.1 of the Lease
1.1.5 BUSINESS HOURS: means the period between 7h00 a.m. to 18h00
p.m., Monday to Friday on business days excluding legal
holidays and such other times as the Lessor may set from
time to time;
1.1.6 PAYMENT OF RENT: All payments that must be effected
according to the Lease shall be made to the order of
9033-0176 Quebec Inc.
1.1.7 NOTICE AND REQUEST:
i) in case of a notice to the Lessor :
9033-0176 Quebec Inc.
634 Louviere
Vimont , Laval
H7W 5G7
Care of: Leasing Director
ii) in case of a notice to the Lessee :
Sword Comp-Soft Corp.
4055 St. Catherine w. suite 133
Westmount, Quebec
H3Z 3J8
Attention: Leonard Stella
|
1.1.8 SPECIAL PROVISIONS
i) FREE INSTALLATION PERIOD
ii) RENEWAL OPTION FOR FIVE (5) YEARS AT AN AUGMENTATION OF
|
5% TO $18,900 US ANNUALLY WITH THE LEASE CONDITIONS REMAINING THE SAME.
1.2 DEFINITIONS - When used in this Lease, and unless incompatible with the context in which they are utilised, the following words and expressions have the meaning hereinafter set forth:
1.2.1 "Common Areas and Facilities": means all areas and
facilities of the Immovable which are not intended for the
exclusive benefit of any lessee in particular, as determined
by the Lessor from time to time;
1.2.2 "Contaminants and Hazardous Materials": have the meaning
attributed thereto in the Environmental Legislation and
include any material which, because of its properties,
presents a real or potential hazard to the environment or
the health of users of the Immovable or of the Leased
Premises;
1.2.3 "Environmental Legislation": means all federal, provincial
or municipal legislative and regulatory environmental
provision, including, in all cases, any judgements, orders,
notices, notices of offence, decrees, codes, rules,
instructions, policies, guidelines and guides,
authorisations, certificates of authorisation, approvals,
permits and licenses issued by any authority having
jurisdiction, the whole as amended from time to time;
1.2.4 "Fiscal Period": means a period commencing on the first
(1st) day of January of the year and ending on the last day
of December next following, with the exception of the first
Fiscal Period, which shall begin at the same time as this
Lease and terminate on the thirty-first (31st) day of
December next following, and with the exception of the last
Fiscal Period, which shall terminate at the same time as
this Lease; however, the Lessor expressly reserves the right
to change the Fiscal Period and its duration. Should the
Fiscal Period be modified or should a part only of a Fiscal
Period be comprised in the Term, the parties shall
immediately make the necessary adjustments.
|
1.2.5 "Immovable": means the land plus the Building and other structures erected thereon from time to time;
1.2.6 "Leasable Area of the Leased Premises": means the area of
the Leased Premises as calculated according to the criteria
of BOMA. At any time during the Term, the Lessor's architect
or land surveyor may definitely determine the Leasable Area
of the Leased Premises. The architect's or land surveyor's
certificate with respect to the Leasable Area of the Leased
Premises shall be conclusive and shall bind all parties
herein retroactively to the Commencement of the Lease;
1.2.7 "Lease": means and refers to this agreement and its
schedules, as well as any amendments thereto;
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1.2.8 "Leased Premises": means the premises as described in article 1.1.1 of this Agreement and subject to the
Lessor's architect's or land surveyor's measurement;
1.2.9 "Lessee": means the Lessee or its successor;
1.2.10 "Lessor": means the owner of the Immovable or its mandatory;
1.2.11 "Operating Expenses": means, all costs incurred in the
operation, administration, maintenance, repair, supervision
and management of the Immovable, including, namely:
1.2.11.1. salaries, wages and costs related to fringe
benefits and pension plan benefits for all
employees of the Lessor engaged in the
operation, maintenance, repair, surveillance,
supervision and management of the Immovable;
1.2.11.2. the cost of all goods and services furnished,
employed or utilised in the operation,
maintenance, repair, surveillance, supervision
and management of the Immovable, except for the
cost of special goods and services furnished to
certain lessees of the Immovable, for which the
said lessees are responsible;
1.2.11.3. the reasonable rental value of the space
occupied by employees of the Lessor engaged in
the administration, supervision or management
of the Immovable, and by all administrative
services of the Lessor, as well as of any space
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required or utilised in the Immovable for security, welfare, health, protection or other similar services, for the benefit of the Immovable and its users in general;
1.2.11.4. the costs related to the maintenance of a public order and security service;
1.2.11.5. the costs of auditing, accounting and management incurred in the operation of the Immovable;
1.2.11.6. the costs related to the planning, maintenance, repair and decoration of the Common Areas and Facilities of the Immovable, including the cleaning of windows and exterior walls, snow removal, cleaning, repair and maintenance of the Land, and contracts with independent contractors;
1.2.11.7. the cost of all repairs to the Immovable, including the replacement of any equipment, apparatus, machinery or other property of the Immovable;
1.2.11.8. the cost of any modifications and improvements to the Immovable, including, without limiting, modifications or improvements to the machinery and equipment contained therein and the cost of any modifications and additional equipment and specialised services needed in the Immovable for energy conservation measures, when, in the opinion of the Lessor, these expenditures are likely to reduce the Operating Expenses or be such as to improve the welfare or the security of the lessees or other occupants of the Immovable, or when such equipment, modifications, materials or improvements are required by law;
1.2.11.9. the total capital depreciation or amortisation, calculated according to the straight-line depreciation method, based on the useful life of the capital assets, or on any other shorter period of time as may be reasonably determined by the Lessor, on the cost of all equipment, apparatus or machinery and other property
required for the operation, maintenance, repair, surveillance, supervision, management, modification or improvement of the Immovable and the establishing of energy conservation measures which, in the opinion of the Lessor, have a useful life longer than one Fiscal Period and the cost of which has not been fully included in the Operating Expenses of the Fiscal Period of their acquisition (in accordance with generally accepted accounting principles) with interest at the Prime Rate upon the undepreciated or unamortized portion of the cost of said asset(1)
1.2.11.10. the cost of energy to ensure: the humidifying, the heating, the ventilating, the air-conditioning and the lighting of the Immovable and not exceeding the standards of these presents, the supply of domestic hot water at all times all other services of the Immovable requiring energy excluding the sums payable by the Lessee in conformity with Article 3.6 of these presents.
1.2.11.11. the real cost of all insurance premiums paid by the Lessor with respect to the Immovable, in accordance with prudent insurance practices or as may be required by the creditors of the Lessor, as well as payment for the franchises.
1.2.12 "Prime Rate": means the rate designated by the National Bank of Canada as being its prime rate, plus five ( 5 )
percentage points.
1.2.13 "Real Estate Taxes": means all levies of any nature
whatsoever on the ownership or operation of the Immovable,
including interest on deferred payments, but excluding tax
on the income or on the capital of the Lessor (except that
part of the tax on the capital attributable to the
Immovable, which is included) and excluding any tax on real
estate transfers;
1.2.14 "Rent": means the Annual Rent;
1.2.15 "Surtax": means any surtax on non-residential immovable or
any other tax imposed under the Municipal Taxation Act
L.R.Q., c. F- 2.1, as modified by L.Q. 1991. c. 32 and L.Q.
1992, c. 532 and any other future modifications.
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1.2.16 "Taxes": means all governmental levies usually paid by
lessees (e.g. water and business taxes, GST, Quebec Sales
Tax), in connection with the Leased Premises, the contents
thereof or the business conducted therein;
1.2.17 "Taxing Authority": means any governmental authority
whatsoever, legally authorised to impose taxes;
1.2.18 "Term": means the period commencing on the date stipulated
as the Commencement of the Lease and terminating on the date
stipulated as the Termination of the Lease;
1.2.19 "Unavoidable Delay": means a delay caused by circumstances
(except for the financial situation of either of the
parties), which are reasonably beyond the control of the
Lessor or the Lessee, as the case may be;
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ARTICLE 2
LEASE AND DELIVERY OF LEASED PREMISES
2.1 Lease of Leased Premises - The Lessor hereby leases to the Lessee the Leased Premises for the Term and in consideration of the Rent to be paid by the Lessee hereunder and of the other provisions and obligations to be observed and executed by the Lessee hereunder.
2.2 Delivery and Finishing of Leased Premises - The Lessee acknowledges having carefully examined the Leased Premises in their present state and declares being fully satisfied therewith. If such examination has not been made, the Lessee undertakes to do so at the time of delivery of the Leased Premises and to notify the Lessor in writing within ten ( 10 ) days of taking delivery of any defect in the Leased Premises. Should the Lessee fail to do so, the Lessee shall be deemed to have taken delivery of the Leased Premises in a good state and to be satisfied therewith, and to acknowledge that i) the Lessor has discharged all its obligations in the preparation and delivery of the Leased Premises and ii) the Leased Premises may be used for the purposes for which they have been leased.
2.3 Minor Deficiencies - Notwithstanding that the Leasehold Improvements are not fully completed at the Commencement of the Lease, the Leased Premises shall be deemed ready for delivery and the Term shall not be affected so long as such incomplete work does not significantly interfere with the use of the Leased Premises.
ARTICLE 3
SERVICES FURNISHED TO THE LESSEE
3.1 Description of Services - The Lessor agrees to supply to the Lessee the following services:
3.1.1 "Air-Conditioning": The Lessor shall supply, during Business
Hours, air-conditioning to the Leased Premises. All special
requests shall be at the expense of the Lessee. The Lessee
shall be liable for the improper functioning of the system
caused by non-conforming partitions, by changes to the
Leased Premises, by the absence of sunshields, by the
excessive use of electrical power, or by the use of
apparatus resulting in the releasing of excessive heat by
the Lessee.
3.1.2 "Elevators": The Lessor shall supply passenger elevators
during Business Hours. At all other times, limited elevator
service shall be available.
The Lessee shall have the use of escalators, if any, and
elevators, in conjunction with all other persons having
access thereto.
The freight elevator, if any, shall be used for the
conveyance of furniture to the Leased Premises, the whole
pursuant to the Lessor's guidelines. Any deliveries shall be
made at the loading ramp of the Building only, and may be
made solely by the representatives of the Lessee.
3.1.3 "Heating": The Lessor shall heat the Leased Premises during
Business Hours. The Lessee shall be liable for any
malfunctioning of the system attributable to non-conforming
partitions or to changes to the Leased Premises.
3.1.4 "Lighting": The Lessor shall provide, at its cost, at the
Commencement of the Lease, standard electrical equipment of
the Immovable as well as the "Supplies" necessary for its
functioning such as bulbs and starters. Thereafter, the
Supplies shall be at the cost of the Lessee, the Lessor
reserving its right to replace all of the Supplies in whole
or in part, should this practice be in conformity with
proper real estate management. The Lessor shall pay all
Hydro bills incurred as the cost of lighting leases
premises.
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3.1.5 "Business Hours": The Building shall be open during Business
Hours. At all other times, the Lessor shall ensure that the
Leased Premises are reasonably accessible.
3.1.6 "Cleaning": The Lessor shall have the Leased Premises
cleaned, outside of Business Hours, according to the
Lessor's usual standards. The Lessee shall leave the Leased
Premises in a proper state. Should, however, the wall or
floor coverings of the Leased Premises differ from the
standard coverings of the Building, or should additional
services be required by the Lessee, the Lessee shall
pay the Lessor the resulting supplementary costs, as
Additional Rent.
3.1.7 "REAL ESTATE TAXES": The Lessor shall bear the costs of all
real estate taxes related to the leased premises regular
and/or special taxes and all surtaxes levied.
3.1.8 "INSURANCE": The Lessor shall keep in force: business
liability insurance for the leased premises there in the
amount of three million dollars ($3,000,000) for each
occurance naming both Lessor and Lessee as the insured
parties. The lessor shall also keep fire insurance
commensurate with the value of the leased premises and all
equipment therein the amount to be agreed to by both Lessor
and Lessee.
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3.2 OTHER OPERATING EXPENSES - The Lessor shall bear the cost of all normal maintenance and administrative expenses of the leased premesis.
3.3 Use of Common Areas and Facilities - The Lessee shall be entitled to use and to benefit from the Common Areas and Facilities of the Immovable, in conjunction with all others also entitled to such and having access thereto. The Lessor may at any time change the form and destination of the Immovable and of its Common Areas and Facilities insofar as the enjoyment of the Leased Premises are not substantially affected.
3.4 Supplies and Services - Only the Lessor or its designated suppliers may provide electrical supplies and services.
3.5 Suspension of Services - In the event of an accident or for the purpose of affecting work, or for any reason beyond the Lessor's control, the Lessor shall be entitled to suspend or to modify any service required to be provided under the Lease for such time deemed reasonable by the Lessor.
3.6 Additional Services - All additional services or services provided outside Business Hours, which the Lessor accepts to provide upon the demand of the Lessee, shall be so provided upon sufficient prior notice and at the expense of the Lessee. The costs and expenses incurred by the Lessor in rendering such additional services shall be subject to an increase of fifteen per cent (15%) for administration fees.
The Lessor shall supply electrical power to the Leased Premises, of a capacity to meet a maximum demand of forty ( 40 ) watts per square metre.
The Lessee undertakes to never consume an amount of electrical power exceeding the capacity of the facilities supplying the Leased Premises. The Lessor shall be entitled to make the necessary verifications.
3.7 Damages caused during the provision of services - The Lessor shall not be liable to any person for any damages in connection with the services described in this Article, whether the services are provided or not, unless caused by the fault or negligence of the Lessor or of its employees. However, in no case shall the Lessee have the right to a reduction of the Rent or to resiliate the Lease. The Lessor shall, however, to the extent possible, remedy the situation with due diligence and within a reasonable delay.
ARTICLE 4
RENT
4.1 The Rent shall be paid on the first (1st) day of each month, at the address indicated by the Lessor without notice and without any abatement or compensation whatsoever. Adjustments for parts of months shall be made on a per diem basis.
ARTICLE 5
USE AND MAINTENANCE OF LEASED PREMISES
As an essential condition of the Lease, it is agreed that the Lessee shall use the Leased Premises as determined in article 1.1.3 of the Lease and in conformity with the dispositions of the present article.
5.1 Use of the Leased Premises - The Lessee undertakes to use the Leased Premises with prudence and diligence. The Lessee undertakes not to disturb the peaceful enjoyment of the other lessees, failing which, the Lessee will be liable towards the Lessor and the other lessees for any damage that may result, whether such damage is caused by the Lessee's own acts or by the acts of persons which the Lessee has allowed to use or have access to the Leased Premises. The Lessee acknowledges and agrees that it is only one of many other lessees in the Building and that therefore the Lessee shall conduct its business in the Leased Premises in a manner consistent with the best interest of the Immovable as a whole.
5.2 Prohibited Use - Without limiting the generality of the foregoing and without derogating from the Lessee's obligations as provided in Article 7.1 hereof, the Lessee will not use or permit or suffer the use of the Leased Premises, or any part thereof, for any of the following businesses or activities, in or from the Leased Premises:
5.2.1 any unethical or fraudulent practice;
5.2.2 any business or activity in respect of which the Lessor has
granted an "exclusive" provision in other leases or offers
to lease entered into by the Lessor and concerning which the
Lessor has given the Lessee written notice. The Lessee
agrees not to conduct its business in the Leased Premises in
a manner that would cause the Lessor to be in contravention
of such exclusive clauses and agrees to indemnify and save
the Lessor harmless against and from any actions or claims
and for all costs and expenses in connection therewith. If,
in the Lessor's opinion, the use by the Lessee of the Leased
Premises is prohibited by a provision of another lease, the
Lessee shall immediately discontinue such use, upon written
notice by the Lessor, failing which, the Lessor shall have
the right to a payment of a penalty equal to four times the
Minimum Rent payable for each day of default or terminate
this Lease by written notice, without prejudice to any of
its other rights and recourses.
The Lessee hereby acknowledges and agrees that, for the
purposes of Article 16.4 hereof, the Lessor, in refusing any
sublet or assignment for any of the aforesaid businesses or
activities, shall not be considered as unreasonably
withholding its consent. Moreover, the Lessor may insist
that the Lessee cease all prohibited activity forthwith upon
demand.
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5.3 Occupancy of the Leased Premises - The Lessee shall occupy the Leased Premises and shall continuously and actively operate its business in the entire area of the Leased Premises during the whole Term; the Lessee shall not leave the Leased Premises vacant or unoccupied at any time during the Term, and shall keep therein the moveable property which is normally used in the operation of its business, the whole at all times throughout the Term. The Lessee acknowledges that its obligations pursuant to this Article 7.3 are of the utmost importance to the Lessor in order to avoid the appearance and impression generally created by vacant space, to facilitate the leasing of space in the Building, and to maintain the character, quality and image of the Building. Furthermore, the Lessee acknowledges that the Lessor
shall suffer important, serious and irreparable damages if the Lessee does not conform to the provisions of the present Article 7.3, and this, even if the Lessee continues to promptly pay all Rent and Additional Rent herein provided.
5.4 Maintenance and Repair of the Leased Premises - The Lessee shall assume and pay for all expenses related to the use and the maintenance of the Leased Premises. In this regard, the Lessee undertakes to effect, at its cost, all replacements and repairs necessary to maintain the Leased Premises in a good state, with the exception of such replacements and repairs due to ageing and normal wear and tear. The present provision includes the Lessee's obligations to pay for replacements and repairs related to the structure or to the electro-mechanical systems of the building when such replacements or repairs are attributable to an act or omission of the Lessee or of any person the Lessee allows to use or to have access to the Leased Premises. It is expressly agreed that all work or replacements to the electro-mechanical systems shall only be effected by the Lessor.
In addition, the Lessor may, at all times, without court authorisation, effect all necessary work, replacements, repairs and maintenance which, in its opinion, is deemed to be necessary in order to ensure the conservation and the enjoyment of the Immovable and the Leased Premises. If the Lessor proceeds with such work, it shall ensure that the enjoyment of the Leased Premises is not materially diminished. If necessitated by the nature of the work, replacements, repairs and maintenance, the Lessor may require the Lessee, without court authorisation, to vacate or to be temporarily dispossessed of the Leased Premises. The Lessor shall exercise its right in a reasonable manner and indemnify the Lessee. Notwithstanding the foregoing, the Lessee shall in no event resiliate or request a reduction of Rent.
5.5 Inspection and Repairs - The Lessor and its representatives may enter the Leased Premises at all times to examine their condition and to make such modifications which they deem necessary or useful for the operation and the proper maintenance of the Immovable or of its electro-mechanical systems.
5.6 Right of Access- If the Lessor deems it necessary to install in the Leased Premises those portions of systems serving the Immovable, the Lessee shall authorise the Lessor to carry out such work without being compensated, provided that the enjoyment of the Leased Premises is not materially diminished.
5.7 Refuse - The Lessee shall follow the instructions of the Lessor with respect to refuse.
5.8 Notice of Defects - The Lessee shall notify the Lessor within a reasonable delay, of any defect or deterioration which is susceptible of damaging the Leased Premises, the Building or the Common Area and Facilities.
ARTICLE 6
LEASEHOLD IMPROVEMENTS
6.1 All Leasehold Improvements carried out in the Leased Premises before or during the Term, shall be first approved by the Lessor, and shall meet the following conditions:
6.1.1 In order to avoid the suspension of work, the Lessee
shall have the work performed, at its own expense, by
contractors and subcontractors approved by the Lessor.
Such contractors and subcontractors shall:
Before the beginning of the work:
a) provide the Lessor with the plans and specifications,
beforehand signed by the Lessee, showing the proposed
Leasehold Improvements, as well as all documents
necessary to work approval, like construction permits,
architecture plan bearing the architects seal,
elevation plan and finish samples, plan of mechanical
and electrical distribution, bearing the seal of a
specialised engineer, if need be. Should the plans
and specifications be approved by the Lessor and
bear the Lessors seal, the Leasehold Improvements
must be carried out in conformity with such
plans and specifications. No Leasehold Improvements
shall be performed by the Lessee as long as the
plans are not approved by the Lessor and attested
by the Lessors seal;
b) provide the certificates of compliance, as well as
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the following documents:
- Company signing resolution;
- Bid bond (when required; the bid bond must be presented with the tender);
- Performance bond (when required);
- Licence from the Regie des entreprises de construction;
- Certificate of compliance with CCQ; (competency
card, permits, etc.)
- Certificate of compliance with CSST;
(contributions paid, etc.)
- List of subcontractors;
c) obtain the necessary permits and authorisations;
d) carry out the Leasehold Improvements, according to the
Lessors instructions;
e) contract, and provide copy of, an insurance against
civil liability, covering their activities in the
Building, until the date of issuance of the certificate
of total performance of work, for an amount of at least
two million dollars ( $ 2,000,000.00 ), as well as a
general property insurance policy covering at least the
amount of the price of the contract and full value of
the specified products to be provided by the contractor
in order to be incorporated to the work. The insurance
contract shall include the Lessor as a co-insured party
and comprise an undertaking clause by such insurers to
notify the Lessor in case of cancellation or
modification of the insurance policy, at least thirty (
30 ) days in advance. To this effect, the contractor
shall be responsible for all damage caused by its
contractors, subcontractors, as well as its suppliers.
Moreover, it is expressly agreed that all work related to
the electromechanical systems will be performed only and
solely by the Lessor.
It is also agreed that the Lessee shall be responsible for
all the professionals and contractors hired on this project.
The Lessee shall also designate a representative who will
communicate with the Lessors supervisor.
6.1.2 It is acknowledged that the Lessee is in no way acting as
the Lessors mandatory with respect to the Leasehold
Improvements carried out in the Leased Premises, and that
such Leasehold Improvements are performed by the Lessee for
its own benefit, even if the Lessor grants the Lessee an
allowance for the work, as it is common practice on the
market.
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6.1.3 Furthermore, at least ten ( 10 ) days before the work in the
Leased Premises begin, the Lessee shall provide the Lessor
with, and this at the Lessors discretion, a security bond on
the construction or a banks letter of credit for the value
of the work to be done, which form and content shall be
subject to the Lessors approval acting reasonably, or a
notice of waiver and a commitment of release for all legal
hypothec or right of legal hypothec that could arise out of
the materials supplied. Should the Lessee default in
providing the Lessor with the guaranties required, the
Lessor can order the immediate ending of the work being done
or to be carried out by such contractor or subcontractor in
the Leased Premises.
6.1.4 Should an hypothec or other security be registered, the
Lessee shall have such hypothec or security cancelled within
fifteen ( 15 ) days. Should this cancellation not be done,
the Lessee shall provide the Lessor with a sufficient
deposit to pay the said hypothec or other security, along
with the pertaining legal fees. Such amount will be
reimbursed to the Lessee, less the expenses incurred by the
Lessor, upon proof of cancellation of the hypothec or
security. If the Lessee defaults in depositing the required
amount, the Lessor shall have the right to cancel such
hypothec or security, and then claim from the Lessee the
reimbursement of the incurred expenses, along with the fees
and the interests, at the Prime Rate.
6.1.5 Each contractor shall respect the working rules of the
Building, a list of which shall be given to the contractors
at the moment of the granting of the contract. The
contractors shall also respect all construction codes. All
work shall be performed after the Business Hours of the
Building. Should some work have to be executed during the
Business Hours, said work shall first be authorised and
permitted by the Buildings manager. Moreover, should the
Lessee have work executed in an area other than the Leased
Premises, or should the Lessee use the freight elevator,
during the performance of work in the Leased Premises, the
Lessor shall provide the services of a security guard, at
the Lessees expense.
The contractor shall be responsible for all damage caused by
its subcontractors, as well as its suppliers, and therefore
the Lessee shall ensure that the contractor has suitable
insurance to this effect.
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6.1.6 The Lessee shall provide the Lessor with the plans as
constructed, shop drawings mechanical balancing report,
plans approved by the City, and operating manuals, within
two (2) weeks following the completion of work.
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6.2 All Leasehold Improvements shall become the Lessors property, as soon as they are installed in the Leased Premises and shall be surrendered with the Leased Premises at the Termination of the Lease, without any compensation whatsoever to the Lessee. Notwithstanding the foregoing, the Lessee shall, at the End of Term or at the moment of any anticipated resiliation of the Term, at its own costs, remove all Leasehold Improvements for which the removal has been demanded by the Lessor, should it have been brought in the Leased Premises before or after the Commencement of the Lease, by the Lessor or the Lessee, or by the Lessor for the previous Lessee. Should the Lessor require so, the Lessee shall, at its own expense, leave the Leased Premises in base building state. The Lessee shall, at its own expense, leave the Leased Premises in good state and clean, under reserve of the repairs due to normal ageing, and repair all damage caused to the Building due to the removal of the Leasehold Improvements.
Provided that the Lessee executed its obligations in virtue of the Lease, at the moment of the End of the Lease, the Lessee shall be entitled to remove from the Leased Premises all its movable properties in the Leased Premises. However, all movable properties left in the Leased Premises after the End of the Lease shall be deemed to be abandoned, and the Lessor may dispose of such properties as it sees fit, without compensation of any nature to the Lessee.
ARTICLE 7
ACCESS BY LESSOR TO LEASED PREMISES
7.1 Visiting the Leased Premises - During the last twelve ( 12 ) months of the Term of this Lease, the Lessee shall permit any person interested in leasing the Leased Premises to visit the Leased Premises during Business Hours.
The Lessee shall permit the Leased Premises to be visited by any broker, purchaser, lender or evaluator of the Immovable. The Lessor shall exercise its right in a reasonable manner.
ARTICLE 8
DAMAGE AND DESTRUCTION
8.1 Destruction of Leased Premises - Should the Leased Premises be destroyed or damaged, the Lessor shall state its intention to the Lessee by way of written notice transmitted to the Lessee within thirty ( 30 ) days of the loss, to the effect that the Leased Premises are:
8.1.1 wholly uninhabitable or that their use is dangerous and
cannot be reasonably repaired within one hundred and eighty
( 180 ) days following the loss, in which case either party
may resiliate the Lease with retroactive effect to the date
of the loss; if such notice is not given within five ( 5 )
days following the notice provided for in Article 11.1, the
Rent shall abate from the date of the loss until the Leased
Premises are repaired and are ready to be occupied by the
Lessee.
8.1.2 wholly uninhabitable or that their use is dangerous but are
reasonably reparable within one hundred and eighty ( 180 )
days following the loss, as the case may be, the payment of
Rent shall abate from the date of the loss until such time
that the Leased Premises are repaired and are ready to be
occupied by the Lessee;
8.1.3 reasonably reparable within one hundred and eighty ( 180 )
days following the loss and are partly usable in the
interim; as the case may be, payment of Rent shall abate,
with respect to the unusable area, from the date of the loss
until such time that the damages have been substantially
repaired.
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8.2 Destruction of the Building - If the Lessor is of the opinion, which shall be given by notice within thirty ( 30 ) days of the loss, that twenty per cent ( 20 % ) or more of the leasable area of the Building is damaged, or if the Lessor is of the opinion that the Building is hazardous and that the Building cannot be reasonably repaired within one hundred and eighty ( 180 ) days or, that the proceeds of insurance do not cover the cost of repairs, then the Lessor may resiliate the Lease effective retroactively as of the date of the loss, all adjustments to the Rent to be made as of such date.
8.3 No Obligation to Rebuild - The Lessor shall be under no obligation to repair or rebuild the Building, the Leased Premises or contents thereof, the Lessee's alterations, improvements or other property.
ARTICLE 9
EXPROPRIATION
9.1 Resiliation of the Lease - In the case of an expropriation or of a taking of possession ("Expropriation") by a competent authority which, according to the Lessor, renders the Building or the Leased Premises unusable, the Lessor may terminate the Lease from the date of the Expropriation by way of a written notice to the Lessee. The Lessee may claim any damages from the expropriating party but not from the Lessor.
9.2 No Obligation to Contest - The Lessor is under no obligation to contest the Expropriation. The parties hereby reserve all their rights to claim future damages against the expropriating authority.
ARTICLE 10
DAMAGES
10.1 Liability of the Lessor - Notwithstanding any provision to the
contrary, the Lessor shall not be liable for damages occurring in the
Leased Premises or in the Immovable resulting from any cause
whatsoever, unless such damages are directly attributable to the fault
of the Lessor. The Lessor shall not be liable for damages suffered by
the Lessee resulting from the fault attributable to a lessee or a
third party even if such third party is a person whom the Lessee or
another lessee of the Building has allowed to use or to have access to
the Leased Premises.
10.2 Limited Liability - Even if the damages are due to the fault of the
Lessor, its liability shall extend only to the movable property and to
the ordinary fixtures of the Lessee located in the Leased Premises and
shall not extend to special equipment, documents and securities.
10.3 No Reduction of Rent - Unless as otherwise stipulated in the Lease,
the Lessee shall not in any case with respect to an occurrence
relating to the Immovable or the Leased Premises or to an act of the
Lessor of any nature whatsoever, have the right to a reduction of Rent
or to the resiliation of the Lease. Nevertheless, the Lessee may, if
granted by a court of law, obtain from the Lessor compensation
resulting from damages directly attributable to the fault of the
Lessor.
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ARTICLE 11
SIGNS AND ADVERTISING
11.1 Consent of Lessor - Any sign or advertising material visible from the
exterior of the Leased Premises or which may be distributed in the
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Immovable must be approved by the Lessor who may require that the
Lessee ceases the use thereof, without delay. Should the Lessee not
comply with the Lessor's request, the Lessor shall be entitled to do
so at its cost and at the expense of the Lessee.
11.2 Maintenance of Signs - The Lessee shall, at its expense, maintain all
signs and shall indemnify the Lessor for any damage which may be
caused to the Lessor.
11.3 Injurious Advertising - The Lessee shall not publish any advertisement
injurious to the reputation of the Lessor, the Lessor or another
lessee of the Immovable, and shall immediately cease any such
advertising at the request of the Lessor.
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ARTICLE 12
COMPLIANCE WITH LAWS AND INDEMNIFICATION
12.1 Compliance with Laws - The Lessee shall comply with all laws and
regulations governing the business conducted in the Leased Premises.
The Lessee shall carry out any changes to the Leased Premises or to
the business conducted therein, which may be legally required by the
competent authorities, failing which, the Lessor, after having given
written notice to the Lessee, may carry out such changes in its place
and at its expense.
12.2 Indemnity of Lessor - The Lessee shall indemnify the Lessor against
any penalty payable by the Lessor resulting from the Lessee's breach
to comply with the present article, including all related expenses,
including legal fees incurred by the Lessor to protect its rights.
12.3 Environmental Clause - During the Term and its renewal, the Lessee
agrees to respect the Environmental Legislation and comply therewith
promptly at its expense and to immediately notify the Lessor of any
release and discharge and presence inside or outside the Leased
Premises of any Contaminants and Hazardous Materials which are in
breach of the Environmental Legislation.
The Lessee is liable for any damage whatsoever caused in or to the
Immovable or the Leased Premises as a result of its non-compliance
with the Environmental Legislation, which damage may also entail the
termination of the Lease.
Notwithstanding anything to the contrary, the Lessee undertakes to
save and hold harmless the Lessor, its representatives, agents or
employees from any claims, losses, costs, fees, expenses, damages for
bodily injury, moral damages, property damages, actions, suits or
proceedings arising from or attributable to Lessee's act, refusal,
negligence or omission to comply with the Environmental Legislation.
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ARTICLE 13
SUBLET AND ASSIGNMENT
13.1 Mandatory Consent of the Lessor - The Lessee shall not assign the
Lease or sublet the Leased Premises in whole or in part, nor suffer
the Leased Premises to be utilised by another person (such utilisation
being, for the purposes hereof, considered as a sublease) without the
written consent of the Lessor, which consent may not be withheld
without a serious reason.
13.1.1 In the event of an assignment or of the subletting of the
whole or any part of the Leased Premises, unless a specific
written consent to this effect is obtained from the Lessor,
no options whatsoever contained in this Lease shall benefit
such sub-lessee or assignee.
13.1.2 The occupancy of a part or of the totality of the Leased
Premises by a third party or the Lessor's tolerance of such
occupancy or its acceptance of any payment shall in no way
constitute a waiver of the Lessee's obligation to obtain the
Lessor's consent for an assignment or a sublet.
13.2 Deemed Assignment - If the Lessee is a company, a corporation or a
partnership, any change in the effective control thereof is deemed to
be an assignment of the Lease and the Lessee and the assignee shall
comply with the present Section 16.
13.3 Information to be provided - The request of the Lessee with respect to
obtaining the consent of the Lessor to the sublease or the assignment
shall include the following:
13.3.1 the name, address and telephone number of the true proposed
sub-lessee or assignee, or in the case of the change of
effective control of a corporation or of a company, those of
the senior executives of the corporation or of the company
as well as of those persons who are acquiring the control
thereof;
13.3.2 information acceptable to the Lessor with respect to the
commercial experience of the persons;
13.3.3 references from banks and other credit institutions,
financial statements (if available) and any other
information which the Lessor may reasonably require for the
purpose of its evaluation;
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13.3.4 if the sub-lessee or the assignee is a partnership or a
company, the declarations or constituting documents thereof,
as amended;
13.3.5 the sub-lessee or the assignee's written undertaking to
respect all and every obligations of the present Lease
including, without limitation, the obligation to grant to
Lessor the same sureties as previously granted by the Lessee
or any other surety that the Lessor may reasonably request.
13.3.6 complete disclosure of all consideration, rental, terms and
conditions of the proposed assignment or sublease, as well
as all information and documents relating to the proposed
sublease or assignment.
13.4 Justified Refusal - The Lessor may refuse to consent to the proposed
sublease or assignment of the Lease, for any serious reason,
including, without limitation:
13.4.1 failure to provide the information or documents required
pursuant to Article 16.3;
13.4.2 the poor reputation, lack of business experience or lack of
commercial success of the proposed sub-lessee or assignee;
13.4.3 if the use which the proposed assignee or sublessee intends
to make of the Leased Premises is in conflict, in whole or
in part, with any exclusivity right then already granted by
the Lessor to another lessee in the Building; or is
incompatible with the image, character or quality of the
Building;
13.4.4 if the proposed assignee or sublessee is already a lessee or
occupant of the Building and other space is available for
such party in the Building or will become available within
the next following six ( 6 ) months; or
13.4.5 if the proposed assignee or sublessee does not intend to
physically occupy the Leased Premises and actively operate
its business therein in good faith; or
13.4.6 if the proposed assignment or sublease becomes effective
before the date on which the Lessee has physically occupied
the Leased Premises and commenced to actively operate its
business therein in good faith.
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13.4.7 if the Lessor has reasonable grounds to believe that the
proposed assignee or sublessee does not have the financial
capacity to meet all its obligations, including, without
limitation, the obligations of the Lessee towards the Lessor
under the Lease.
13.5 Answer of the Lessor - Within thirty ( 30 ) days from the receipt of
the Lessee's complete request for the Lessor's consent, together with
all the required information and documents, the Lessor shall inform
the Lessee:
a) of its refusal to consent, stipulating the reasons
therefor, or
b) of its consent, or
c) that the Lessor has chosen, as an alternative to
its consent (without affecting its other rights and
without being obliged thereto), to become itself the
sublessee or the assignee, as the case may be, for
the same consideration, rentals, terms and
conditions as those of the proposed sublease or
assignment, in the place of the proposed assignee or
sublessee, or
d) that the Lessor has chosen, as an alternative to
its consent (without affecting its other rights and
without being obliged thereto), to terminate the
Lease as of the fifteenth ( 15th ) day following the
date on which the Lessor so informs the Lessee, it
being understood that the Lessee shall, however, have
the right to withdraw its request for consent to the
proposed assignment or sublease within such fifteen
(15) days delay.
13.6 Delay for Sublet or Assignment - Should the Lessee not sublet or
assign the Leased Premises within sixty ( 60 ) days after having
obtained the consent of the Lessor, said consent shall be considered
null and the Lessee shall recommence the procedure for carrying out
the sublease or the assignment.
13.7 Should the Lessor fail to perform its obligations for which it is
bound to the Lessee, the sub-lessee may not exercise the rights and
remedies of the Lessee against the Lessor.
13.8 Solidarity - Notwithstanding any sublease or assignment, the Lessee's
liability shall remain solidary with the assignee or the sub-lessee,
as the case may be for all of the obligations of the Lessee pursuant
to the Lease, so that the Lessor may compel the Lessee, and the Surety
(if any), to observe all of the obligations of the Lease as if no
assignment or sublease had occurred.
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13.9 Expenses of the Sublease or the Assignment - If the sublease or the
assignment is accepted, the Lessee shall reimburse the Lessor for the
related administrative expenses, subject to the approval of the
sublease or the assignment, which shall be payable by certified cheque
and shall be remitted at the time of signature of the agreement of
sublease or of assignment.
13.10 Approval of Publicity - The sublease or the assignment may not be
publicised in any manner whatsoever, without the express approval of
the Lessor with respect to the form and substance of such publicity,
all advertising in relation to the sublease or the assignment of the
Lease may be injurious to the Immovable.
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ARTICLE 14
ASSIGNMENT BY LESSOR
14.1 Assignment by Lessor - In the event of a sale, transfer or an
assignment of the Immovable or any part of the Immovable by the
Lessor, or an assignment by the Lessor of this Lease or any interest
in the Lease hereunder, the Lessor shall be freed of all liability
with respect to any obligations in virtue of the Lease or of the law
if such purchaser or assignee assumes the Lessor's obligations
according to the Lease or law.
14.2 Lessees Certificates - At any time and from time to time upon not less
than ten ( 10 ) days prior notice at the request of the Lessor, the
Lessee shall execute and deliver, as directed by the Lessor, a
certificate of an officer of the Lessee certifying as at the date
thereof whether this lease is in full force and effect, whether or not
it has been modified (and if so in what respect), the status of annual
rent and other accounts between the Lessor and Lessee, whether or not
there are any existing defaults on the part of the Lessor of which the
Lessee has notice (and if so, specifying them) and as to any other
matters in connection with this lease in respect of which such a
certificate is reasonably requested.
14.3 Lessors Certificates - At any time and from time to time upon not less
than ten ( 10 ) days prior notice at the request of the Lessee, and
for the purposes only of a transaction contemplated by Article 17, the
Lessor shall execute and deliver, as directed by the Lessee, a
certificate of an officer of the Lessor certifying as at the date
thereof whether this lease is in full force and effect, whether or not
it has been modified (and if so in what respect), the status of annual
rent and other accounts between the Lessor and Lessee, whether or not
there are any existing defaults on the part of the Lessee which the
Lessor has notice (and if so, specifying them) and as to any other
matters in connection with this lease in respect of which such
certificate is reasonably requested.
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14.4 Effect of Certificates - Any statement delivered pursuant to the
provisions of this Article 17 may be conclusively relied upon only by
the person to which such statement is addressed but shall not preclude
any rights of the party giving such statement with respect to defaults
not set forth in such statement but of which the party giving such
statement had no actual knowledge at the date thereof as against the
other immediate party to this lease.
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ARTICLE 15
DEFAULT AND RECOURSE
15.1 A default shall occur in the following cases:
a) if the Lessee does not fulfil any of its obligations pursuant to
the Lease and if this default continues:
i) in the cases of a pecuniary obligation, for more than five
(5) days following the receipt by the Lessee of a written
notice from the Lessor;
ii) in all other cases, for more than fifteen ( 15 ) days
following the receipt of a written notice from the Lessor
(unless it constitutes a default otherwise provided for in
this paragraph 18.1 or unless the default cannot be cured
within said delay, in which case the Lessee shall have
commenced to cure the default within the prescribed delay
and to continue to do so with diligence) or within a shorter
delay stipulated in the Lease (the latter delay taking
precedence);
b) if the Lessee is the object of bankruptcy, insolvency,
dissolution or liquidation proceedings or loses control of the
property located in the Leased Premises;
c) if the Lessee makes a sale of an enterprise or if the property
located in the Leased Premises is seized and that a release
thereof is not obtained within fifteen ( 15 ) days;
d) if the Lessee do not continuously operate its business in the
entire area of the Leased Premises, leaves the Leased Premises
vacant during five ( 5 ) consecutive days or if the Leased
Premises are used by a person who is not authorised pursuant to
the Lease; or
e) if a sublease or an assignment is attempted or if the Lessee
grants a guarantee that affects the Lessor's own guaranties
provided in the Lease.
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The mere lapse of the delays provided for in paragraph 18.1 or as
otherwise provided for in the Lease shall have the effect of deeming
the Lessee in default.
15.2 Default and Recourses - Each time that an event of default occurs,
subject to the other rights and recourses which are granted to the
Lessor pursuant to the Lease or law and notwithstanding any other
provision of the law, the Lessor shall have the following rights and
remedies, which shall be cumulative and not alternative:
a) the right to terminate the Lease by notice to the Lessee and
following such notice, the Lessee shall not be entitled to remedy
the default;
b) the Lessor may enter the Leased Premises as mandatory of the
Lessee, re-let them for the duration of the Term and on such
conditions which the Lessor may determine at its discretion,
collect the Rent, take possession, as mandatory of the Lessee, of
all moveable property located in the Leased Premises and, in such
a case store the moveable property at the cost and risk of the
Lessee or sell or assign it in such manner as the Lessor deems
appropriate without notice to the Lessee; make modifications to
the Leased Premises in order to facilitate their re-letting;
apply the proceeds of any sale or re-letting to the payment of
all expenses incurred by the Lessor in connection with such
re-letting or of such sale and to any other debt of the Lessee
towards the Lessor and, lastly, to the payment of Rent in arrears
or of future payments of Rent which are to become due. The Lessee
shall remain liable to the Lessor for any deficiency;
c) the right to remedy or attempt to remedy, at the expense of the
Lessee and with no liability on the part of the Lessor, any
default of the Lessee pursuant to the Lease on behalf of the
Lessee and to enter the Leased Premises for such purposes.
d) the right to recover from the Lessee all damages suffered as well
as all expenses incurred by the Lessor pursuant to the default of
the Lessee
15.3 Indemnity - Should the Lessor retain the services of legal counsel in
connection with the non performance by the Lessee of its obligations
pursuant to these presents, the Lessee shall pay the Lessor as
damages, judicial costs, and fees of fifteen per cent ( 15 % ) of the
amount of the Rent due in connection with such legal services.
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ARTICLE 16
NOTICE
16.1 Any notice to be given under this Lease shall be sent by registered
mail or by telecopier transmission or delivered in person at the
addresses indicated above at article 1.1.7. The Lessor reserves the
right to change its address.
Notices sent by mail shall have been deemed to be received on the
third business day following the mailing thereof and those by
telecopier the business day following their transmission.
The Lessee elects domicile in the Leased Premises for all purposes in
connection with these presents.
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ARTICLE 17
TERMINATION OF LEASE
17.1 Any occupation of the Leased Premises by the Lessee after the
Termination of the Lease shall not have the effect of extending, or
expressly or tacitly renewing the Lease.
17.2 The Lessor may allow the Lessee in the event the Lessee occupies the
Leased Premises after the Termination of the Lease, to continue its
occupation pursuant to a monthly Lease in consideration of a monthly
Rent which is fifty per cent ( 50 % ) greater than the last monthly
Rent of the Term, the other terms and conditions of the Lease
remaining the same.
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ARTICLE 18
UNAVOIDABLE DELAY
18.1 Except for the payment of an amount of money, each time the Lease
provides for the performance of an obligation, the obligation shall be
performed subject to Unavoidable Delay. The Lessee and the Lessor
shall be deemed not to be in default in the performance of any
obligation under this Lease if they are prevented from so doing by
Unavoidable Delay, and any period of time for the performance of such
obligation shall be extended accordingly.
The Lessee and the Lessor shall notify each other respectively without
delay at the outset of the cause, the duration and the effect, to
their knowledge, of any Unavoidable Delay.
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ARTICLE 19
MODIFICATION OF LEASE AND PERFORMANCE BY A THIRD PARTY
19.1 Modification of Lease - Any modification of the Lease shall be valid
only if expressly agreed to in writing by the Lessor, the Lessee and
the Surety (if any).
19.2 Performance by Third Party - A third party may not acquire any rights
pursuant to these presents in performing an obligation of the Lessee.
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ARTICLE 20
MISCELLANEOUS
20.1 Declaration of intent - This Lease is intended to be a simple document
drafted in ordinary language. When words or expressions of a general
meaning are used, the widest possible meaning is to be given to them
unless the context clearly indicates otherwise.
20.2 Absence of Waiver - The fact that one or the other party has not
exercised any of its rights hereunder shall not constitute a waiver
thereof.
20.3 Cancellation of Previous Agreements - This Lease represents the entire
agreement between the parties in connection with the Leased Premises.
It replaces all previous documents and discussions between the
parties.
20.4 Successors and Assigns- The Lease shall bind the successors and
assignees of the parties.
20.5 Brokerage Commission - The Lessee warrants to the Lessor that it has
not retained the services of any broker in respect with this
transaction. Any brokerage commission with respect to the present
transaction shall be borne exclusively by the Lessee who shall
indemnify the Lessor against any claim with respect thereto, except in
the case where the Lessor has given a specific written mandate to an
agent with respect to this transaction.
20.6 Brokerage Commission - The Lessor shall be responsible to pay the
leasing commission pertaining to the present Lease upon the terms and
conditions stipulated in a commission agreement to intervene between
the Lessor and the broker.
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20.7 Conversion - The Parties to this Lease agree to the following metric
factors :
1 metre = 3.2808 feet
1 square metre = 10.7643 square feet
1 foot = 0.3048 metres
1 square foot = 0.0929 square metres
20.8 Cumulative Rights - The rights conferred to the Lessor shall not be
exclusive but shall be cumulative.
20.9 Undertaking to Cooperate - The parties agree to sign all documents and
do all things necessary or desirable in order to give effect to the
intention of the parties.
20.10 Publication of Lease - The Lessee shall have the right to publish the
Lease, after having obtained the prior approval of the Lessor as to
the form and as to the other terms of the publication, without however
mentioning any of the Lease's financial terms, failing which, the
Lessor may radiate such publication at the Lessee's cost. Such
publication shall be made solely at the Lessee's cost, including
publication fees and the cost of a published copy for the Lessor. In
cases of publication, the Lessee shall, at the Termination of the
Lease, cause the publication to be cancelled at its cost, failing
which the Lessor may do so at the expense of the Lessee.
20.11 Partial Invalidity - All of the parts of this Lease are divisible. If
for any reason whatsoever a provision thereof is judged to be illegal
or unenforceable, the other provisions of the Lease shall remain in
effect mutatis mutandis.
20.12 Interpretation - In this Lease, unless the context dictates otherwise:
i) the masculine includes the feminine and the singular the plural,
and
ii) the words "hereinabove" and "these presents" or any words or
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expressions having similar import shall refer to the Lease in its entirety.
20.13 Laws - This Lease shall be governed by the Laws in effect in the
province of Quebec. In addition, by these presents, all the parties
elect domicile in the Court of jurisdiction for the judicial district
of Montreal, for all judicial proceedings which may be taken in
connection with the application of the present Lease, notwithstanding
the fact that one or the other parties may have signed this Lease
outside of the judicial district of Montreal.
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20.14 Late Payments - The acceptance by the Lessor of post-dated cheque or
of any late payment shall be considered as a means of collection only,
subject to the rights of the Lessor pursuant to these presents. Any
sums unpaid by the Lessee shall bear interest at the Prime Rate.
20.15 Solidary liability - If several persons have signed this lease, their
liability is solidary, so that each person shall be liable for all of
the obligations under this Lease, without division and discussion
benefits.
20.16 Titles - The titles and the numbering of the articles have been
inserted as a matter of convenience and shall not be used to interpret
the text thereof.
20.17 Time is of the Essence - All delays provided for in the Lease in
connection with an undertaking or an obligation of the Lessee or of
the Lessor are of the essence.
20.18 Prohibition to sell by auction - In the event of the Lessee's
bankruptcy, there shall be no sale by auction, performed by any
competent authority whatsoever, permitted in the Leased Premises.
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ARTICLE 21
REGULATIONS
21.1 The Lessee shall observe the regulations respecting the use of the
Immovable, which are annexed hereto as Schedule "A", as such
regulations may be modified by the Lessor, to the extent that they are
not in contradiction with the Lease. The regulations may differ
depending on the type of business located in the Immovable but may not
be discriminatory.
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ARTICLE 22
SPECIAL PROVISIONS/SCHEDULES
22.1 The schedules form an integral part of this Lease.
All parties have agreed to draw up this offer to lease in the English language . Que tous les parties ont agree de faire ce bail en Anglais.
In witness whereof the Lessee acknowledges that, notwithstanding that the Lease was drawn up and submitted by the Lessor, the Lessee has negotiated the Lease, that it understands all of its provisions and that it was given adequate explanations as to the nature and extent of the Lease. The Lessee has signed these presents on the this _____26_____________th day of ___April_____ __2000_____.
SWORD COMP-SOFT CORP.
"Lessee"
Per:
---------------------------------- ------------------------------------
Witness Leonard Stella
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In witness whereof the Lessor has signed these presents in __Montreal___________, this ______26____________th day of _____April______,____2000____.
9033-0176 Quebec Inc. "Lessor"
Per:
----------------------------------- ---------------------------------
Witness Leasing Director
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SCHEDULE "A"
REGULATIONS
1. The Lessee agrees to observe all of the following regulations and any additional regulations as the Lessor may from time to time prescribe with respect to the proper management of the Immovable.
1.1 These regulations shall not be incompatible with the terms of the Lease.
1.2 Any amendment shall be communicated in writing to the Lessee.
2. Traffic
2.1 Access to the Immovable shall at all times be under the control of the Lessor's security officer on-duty who may require persons to identify themselves and may refuse access for any justifiable reason;
2.2 Prohibition to Impede Traffic - The Lessee shall not leave or allow any objects to be left that might impede the movement of traffic in the Common Areas and Facilities of the Immovable.
2.3 Loading and Unloading - The loading and unloading of merchandise and of furniture shall be made at the risk of the Lessee and pursuant to instructions from the Lessor.
3. General Services The work of the Lessee at the interior of the Leased Premises with respect to the handling of merchandise and of furniture shall be effected by the employees of the Lessor at the cost of the Lessee at rates which the Lessor shall from time to time determine.
4. Public Areas The use of the Common Areas and Facilities shall be under the exclusive control of the Lessor.
5. Emergencies and Security
5.1 Any emergency situation shall be brought to the attention of the Lessor's security officer.
5.2 Only the stairways and emergency exits shall be used in cases of emergency.
5.3 Close coordination and cooperation shall be maintained between the Lessee's and Lessor's security services, for the protection of the Immovable.
5.4 Interruption of Services - Elevator, freight elevator and escalator service in the Building may be interrupted for reasons of maintenance or emergency.
5.5 No Smoking - Smoking in the elevators and freight elevators and Common Areas and Facilities of the Building is prohibited.
6. Mechanical and Electrical Systems
6.1 The maintenance of the private mechanical and electrical systems of the Lessee shall be maintained by it at its costs, unless there is an agreement to the contrary.
6.2 The allocation of costs of supplying fluids, electrical consumption or any other source of energy shall be made by the Lessor.
7. Vehicles and Animals
7.1 It is prohibited to bring into the Building or the Leased Premises any animal, bicycles or vehicle except for:
a) animals or vehicles serving as guides for the blind or otherwise handicapped persons; and
b) vehicles which may be authorised in the parking areas, by agreement with the operator of the parking lot and pursuant to instructions from the Lessor.
8. Machinery, Equipment and Safe Except for office equipment, no machine or piece of equipment may be brought into the Building without the approval of the Lessor, who may refuse their installation or who may designate a specific area in which to place heavy objects in the Leased Premises.
9. Illegal activities by the Lessee and Peddling The Lessee shall not cause a nuisance to its neighbours and shall respect the good order and the security of the Immovable. Any peddling and soliciting in the Immovable is strictly prohibited and the Lessee agrees to cooperate with the Lessor in order to prevent such activities.
10. Sales and Types of Business The sale of merchandise and of services is prohibited without the prior approval of the Lessor.
11. Signs, Etc. The Lessee shall ensure that all signs or objects which are visible from the exterior of the Leased Premises are in accordance with
instructions of the Lessor. All signs and advertising materials are prohibited.
12. Advertising, Address
12.1 The words 4055 Ste. Catherine West, Westmount, Quebec, H3Z 3J8 shall not be used by the Lessee except to describe the Leased Premises or to designate the address thereof.
12.2 The Lessor reserves the right to prevent any advertising by the Lessee which might harm the security, the reputation or the operation of the Immovable, and, without limiting the generality of the foregoing, the Lessor may prohibit the Lessee from advertising any illegal activity or the sale of any illicit or objectionable product.
12.3 The Lessor reserves the right, at any time and without notice to the Lessee, to change the address and the postal code for the Immovable.
13. Mechanical and Electrical Systems
13.1 Special maintenance and repair services for the mechanical and electrical systems inside the Leased Premises shall be performed only by the Lessor and these special services shall be charged to the Lessee according to rates which the Lessor shall from time to time establish.
13.2 Air-conditioning and heating services shall be provided during Business Hours. Extra services shall be charged to the Lessee pursuant to rates set by the Lessor from time to time.
13.3 The density of occupancy of the Leased Premises shall not exceed one (1) person per one hundred ( 100 ) square feet of Leasable Area.
14. Utilisation of Incremental or Fan-Coil units of the Air-Conditioning and Heating System
14.1 In order to ensure the proper functioning of the air-conditioning system, the Lessee shall not utilise the incremental or fan-coil units of the air-conditioning and heating system (perimeter zone) for the storage of documents or other items, so as not to affect the operation of said units and said system.
14.2 Any curtains mounted on the windows shall be placed so as not to impede the operation of said units and said air-conditioning system.
14.3 The Lessee shall at all times keep outside windows closed (where applicable) and, while the air-conditioning system is operating, keep the blinds of all windows exposed to direct sunlight closed as well.
15. Entry Doors to Leased Premises
15.1 The Lessee shall not change the access systems without the consent of the Lessor. Should more than two keys be required for each lock, they shall be supplied by the Lessor, at the Lessee's expenses. The Lessee shall return all keys of the Leased Premises to the Lessor at the Termination of the Lease.
15.2 The Lessor shall furnished to the Lessee, at its costs, one ( 1 ) "high disk" to access the Immovable and the elevators, for each four hundred ( 400 ) square feet of Leasable Area of the Leased Premises. Should more "high disk" be required, they shall be supplied by the Lessor, at Lessee's expenses. Every "high disk" shall remain the Lessor's property.
16. Cleaning (Housekeeping) All cleaning services for office spaces and public areas shall be performed only by the Lessor's employees, except by written agreement to the contrary.
SCHEDULE "B"
STANDARD RESOLUTION
Excerpt from the minutes of a meeting of the Board of Directors of Sword Comp-Soft Corp. (hereinafter referred to as the "Company") held on____26_____th day of _April___, ___2000_____.
Be it resolved:
That the Company enters into a Lease Agreement with 9033-0176 Quebec Inc., for the premises number located in the building bearing civic number , the whole in accordance with a draft Lease which has been submitted and approved by the Board of Directors.
That Leonard Stella be duly authorised to enter into a Lease for and on behalf of the Company and to sign any and all documents necessary in order to give effect to the Lease.
I hereby certify that the foregoing is a true copy of a resolution passed in a meeting that has been called and held this 26th day of April, 2000, by all the Directors of the Company as stated in the minutes of the said meeting and that the said resolution is hereby still in effect.
This _26____ th day of __April__, __2000___.
Exhibit 23.2
CONSENT OF INDEPENDENT AUDITORS
I consent to the use in this Registration Statement on October 18, 2000 of Sword Comp-Soft Corp., of my report dated July 15, 2000, appearing on the Prospectus which is part of this Registration Statement.
I also consent to the reference to me under the heading "Experts" in such Prospectus.
By: /s/ Mark Cohen
--------------
Mark Cohen C.P.A.
Hollywood, Florida
10/18/00
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| ARTICLE 5 |
| CIK: 1126162 |
| NAME: SWORD COMP SOFT CORP. |
| PERIOD TYPE | YEAR |
| FISCAL YEAR END | APR 30 2000 |
| PERIOD START | MAY 01 2000 |
| PERIOD END | APR 30 2000 |
| CASH | 151,660 |
| SECURITIES | 0 |
| RECEIVABLES | 0 |
| ALLOWANCES | 0 |
| INVENTORY | 0 |
| CURRENT ASSETS | 151,660 |
| PP&E | 0 |
| DEPRECIATION | 0 |
| TOTAL ASSETS | 166,660 |
| CURRENT LIABILITIES | 6,853 |
| BONDS | 0 |
| PREFERRED MANDATORY | 0 |
| PREFERRED | 0 |
| COMMON | 1,100 |
| OTHER SE | 158,708 |
| TOTAL LIABILITY AND EQUITY | 159,807 |
| SALES | 0 |
| TOTAL REVENUES | 0 |
| CGS | 0 |
| TOTAL COSTS | 0 |
| OTHER EXPENSES | 11,454 |
| LOSS PROVISION | 0 |
| INTEREST EXPENSE | 0 |
| INCOME PRETAX | 0 |
| INCOME TAX | 0 |
| INCOME CONTINUING | 0 |
| DISCONTINUED | 0 |
| EXTRAORDINARY | 0 |
| CHANGES | 0 |
| NET INCOME | 0 |
| EPS BASIC | 0.001 |
| EPS DILUTED | 0 |