Registration of Securities of a Small-Business Issuer — Form 10-SB
Filing Table of Contents
Document/Exhibit Description Pages Size
1: 10SB12G Registration Statement 35 153K
2: EX-2.1 Articles of Incorporation 18 43K
3: EX-2.2 By-Laws 8 19K
4: EX-3.1 Form of Unsecured Convertible Note 10 36K
5: EX-6.1 Loan Agreement 5 21K
6: EX-6.1(A) Merger Agreement 22 101K
7: EX-6.2(4) Lease 2 7K
8: EX-12 Articles of Merger 3 13K
EXHIBIT 3.1
Form of Unsecured Convertible Note
UNSECURED CONVERTIBLE NOTE
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ISSUED PURSUANT TO THE
UNSECURED CONVERTIBLE NOTES (THE "NOTES") LOAN AGREEMENT BETWEEN MERCANTILE
FACTORING & CREDIT CORP. AND WORLDNET CONNECTIONS, INC, DATED JULY 30, 1999, AND
MAY BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF ONLY IN ACCORDANCE WITH THE
TERMS THEREOF.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") , OR ANY STATE SECURITIES
LAWS AND NEITHER SUCH SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD,
PLEDGED, ASSIGNED OR OTHERWISE TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT
WITH RESPECT THERETO IS EFFECTIVE UNDER THE ACT AND ANY APPLICABLE STATE
SECURITIES LAWS OR (2) THE ISSUER RECEIVES AN OPINION OF COUNSEL TO THE HOLDER
OF SUCH SECURITIES, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO THE
ISSUER, THAT SUCH SECURITIES MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR
TRANSFERRED IN THE MANNER CONTEMPLATED WITHOUT AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE ACT OR APPLICABLE STATE SECURITIES LAWS.
Issue Date:________________________, 1999 (the "Issue Date")
Principal Amount: U.S.$________________________________(the "Principal Amount")
FOR VALUE RECEIVED, MERCANTILE FACTORING & CREDIT CORP., a Nevada
corporation (the "Company"), promises to pay to WORLDNET CONNECTION, INC. or its
assigns (the "Holder"), the Principal Amount in lawful money of the United
States of America together with interest in the amounts and at the times set out
below:
(i) on the first (1st) business day following the fifth
anniversary of the Issue Date ("Anniversary Date") or on such
earlier date as the Principal Amount hereof may become due in
accordance with the provisions and subject to the conditions
contained herein; and
(ii) to pay interest on the Principal Amount hereof at rate of
eight percent (8%) per annum ("Interest Rate"), compounded
annually, from the Issue Date up to the first (1st) business
day following the Anniversary Date or on such earlier date as
the Principal Amount hereof may become due in accordance with
the provisions and subject to the conditions contained herein.
The Company will pay or cause to be paid to the Holder all sums becoming
due as principal of and premium, if any, and interest (including interest on
amounts in default) on this
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Note, at the address set forth on the books of the Company (or at such other
place as the Holder may designate for such purpose from time to time by written
notice to the Company), without presentation of this Note or making any notation
thereon. Such payments shall be made either by cheque or bank draft or other
means acceptable to Holder payable at par in Nevada, at the office of the
Holder, located at 1495 Ridgeview Drive, Suite 220, Reno, Nevada 89509, or at
such other place as shall be designated in writing for such purpose.
At any time after the date hereof, the Company shall have the right, at
its entire discretion, to redeem all or any of the Note prior the Anniversary
Date at a redemption price equivalent to the Principal Amount plus accrued and
unpaid interest to the date specified for redemption.
At any time after the close of business on the last business day of August
1999 (the "Conversion Date"), the principal amount of this Note is convertible,
in whole, into fully paid and non-assessable common shares of the Company's
$.001 par value common stock (the "Company Shares"), at a conversion rate of
sixty (60) Company Shares for each one hundred dollars ($100.00) in principal,
in the manner specified herein and subject to adjustment as set forth below.
Should this Note be converted as provided for herein, no interest shall accrue
or be payable in respect of the Principal Amount of this Note. Conversion of
this Note shall be determined as follows:
(i) divide the Principal Amount by one hundred (100) and then,
(ii) multiply the quotient by sixty (60), the product of which is the
amount of Company Shares to be issued to the Holder.
In the event that this Note is converted as specified herein, the Holder
shall surrender this Note to the Company at its principal office, or its
registered office, together with the conversion form attached hereto, duly
executed by the Holder in form and executed in a manner satisfactory to the
Company. Thereupon the Holder shall be entitled to be entered into the books of
the Company, on the Conversion Date, as the holder of the number of Company
Shares into which the Principal Amount of this Note is converted into in
accordance with the provisions hereof and, as soon as practicable thereafter,
the Company shall deliver to the Holder the certificates for such Company
Shares. The Company Shares received by the Holder as a result of the conversion
of this Note shall qualify to receive dividends declared in favour of
shareholders of record on and after the Conversion Date and from such date such
Company Shares will for all purposes be and be deemed to be issued and
outstanding as fully paid and non-assessable Company Shares. The Company shall
not be required to issue fractional Company Shares upon the conversion of this
Note pursuant hereto. The Company covenants with the Holder that it will at all
times reserve and keep available out of its authorized Company Shares, solely
for the purpose of issue upon conversion of this Note as provided herein. The
Company covenants with the Holder that all Company Shares which shall be so
issuable shall be duly and validly issued as fully paid and non-assessable.
The price at which this Note is convertible and the number of Company
Shares
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deliverable upon the conversion of the Note will be subject to adjustment in the
events and in the manner following:
(1) If and whenever at any time prior to the Conversion Date, the Company:
(i) subdivides or redivides the outstanding Company Shares into a
greater number of Company Shares;
(ii) reduces, combines or consolidates the outstanding Company Shares
into a smaller number of Company Shares; or
(iii) issues Company Shares or securities exchangeable for or convertible
into Company Shares to the holders of all or substantially all of
the outstanding Company Shares by way of a stock dividend (other
than the issue of Company Shares to holders of Company Shares
pursuant to their exercise of options or other entitlement to
receive dividends in the form of Company Shares in lieu of dividends
paid in the ordinary course on the Company Shares),
(any of such events being called a "Share Reorganization") the number of
Company Shares to be issued will be adjusted by multiplying such number by
a fraction, the denominator of which is the number of Company Shares
outstanding on such date before giving effect to such Share Reorganization
and the numerator of which is the total number of Company Shares
outstanding immediately after the effective date, in the case of
subsections (i) and (ii) above and the record date in the case of
subsection (iii), including in the case where securities exchangeable for
or convertible into Company Shares are distributed, the number of Company
Shares that would have been outstanding had such securities been exchanged
for or converted into Company Shares on such record or effective date.
Such adjustment will be made successively whenever any event referred to
in this subsection (1) occurs.
(2) If and whenever at any time prior to the Conversion Date there is a
reclassification or change of outstanding Company Shares, other than a
subdivision or consolidation described above, or a consolidation, merger,
reorganization or amalgamation of the Company with or into another body
corporate, or a sale of all or substantially all of the assets of the
Company followed immediately by a liquidation or winding-up of the Company
and distribution of its assets to its shareholders, the Holder will be
entitled to receive and will accept, upon any conversion hereunder at any
time after the effective date thereof, in lieu of the number of Company
Shares to which it was theretofore entitled on conversion, the kind and
number of Company Shares or other securities or money or other property
that such Holder would have been entitled to receive as a result of such
reclassification, change, consolidation, merger, reorganization,
amalgamation or winding-up, if, on the effective date thereof it had been
the registered holder of the number of Company Shares to which it was
theretofore entitled upon conversion, subject to adjustment thereafter in
accordance with provisions which are the same, as nearly as possible, to
those contained above.
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(3) In any case in which these provisions require an adjustment which shall
become effective immediately after a record date for an event referred to
herein, the Company may defer, until the occurrence of such event, issuing
to the Holder converting after such record date and before the occurrence
of such event, the additional Company Shares issuable upon such conversion
by reason of the adjustment required by such event before giving effect to
such adjustment; provided, however, that the Company will deliver to the
Holder an appropriate instrument evidencing the Holder's right to receive
such additional Company Shares upon the occurrence of the event requiring
such adjustment and the right to receive any distributions made on such
additional Company Shares declared in favour of holders of record of
Company Shares on and after the Conversion Date or such later date as the
Holder would, but for the provisions of this subsection (3) have become
the holder of record of such additional Company Shares hereunder.
(4) The adjustments provided for herein are cumulative and will apply to
successive subdivisions, redivisions, reductions, combinations,
consolidations, distributions, issues or other events resulting in any
adjustment under the provisions hereof.
(5) In the event of any question arising with respect to the adjustments
provided herein, such question will be conclusively determined by an
accounting firm appointed by the Company and acceptable to the Holder, and
the accountants from such firm will have access to all necessary records
of the Company and such determination will be binding upon the Company and
the Holder.
(6) At any time prior to the Conversion Date, the Company will give at least
fourteen (14) days' prior written notice of any subdivision, redivision,
reduction, combination, consolidation, distribution, issue or other events
resulting in any adjustment under the provisions hereof and will not
during the period of such notice close the transfer books for its Company
Shares so as to prevent the Company Shares resulting from the conversion
of this Note to be voted.
(7) If any of the events referred to in subsections (1) or (2) hereof occurs,
the Company will promptly file with the Holder a certificate of the
Company, setting forth a brief statement of the facts and the consequent
adjustment required to be made by the provisions of this Note with respect
to conversion of this Note.
This Note is registered on the books of the Company and is transferable
only by surrender thereof at the principal office of the Company, duly endorsed
or accompanied by a written instrument of transfer duly executed by the Holder
of this Note. Payment of or on account of principal and interest on this Note
shall be made only to or upon the order in writing of the Holder.
Upon reasonable request by the Holder and without expense to the Holder,
the Company will exchange the Note held by the Holder for other Notes of
different denominations.
If this Note is placed in the hands of an attorney for collection, or is
collected through
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court proceedings, or through other legal proceedings, the Company promises to
pay an additional reasonable amount as attorneys' fees.
The Company hereby waives presentment, demand, notice, protest and all
other demands and notices in connection with the delivery, acceptance,
performance, default or enforcement of this Note.
No delay or failure on the part of the Holder hereof to exercise any power
or right shall operate as a waiver hereof, and such rights and powers shall be
deemed continuous, nor shall a partial exercise preclude full exercise thereof;
and no right or remedy of the Holder hereof shall be deemed abridged or modified
by any source of conduct, and no waiver thereof shall be predicated thereon, nor
shall failure to exercise any such power or right subject the Holder hereof to
any liability.
Any one or more of the following shall constitute an "Event of Default" as
the term is used herein:
(a) default occurring in the payment of interest on this Note when the
same shall become due and such default continues for more than
fifteen (15) days; or
(b) default occurring in any payment of principal of this Note at the
expressed or any accelerated maturity date or at any date fixed for
prepayment and such default continues for more than fifteen (15)
days; or
(c) default is made in the payment of the principal of or interest on
any indebtedness of the Company for borrowed money as and when the
same shall become due and payable by the lapse of time, by
declaration, by call for redemption or otherwise, and such default
continues beyond the period of grace, if any, allowed with respect
thereto; or
(d) default or the happening of any event occurring under any indenture,
agreement or other instrument under which the Company has borrowed
money and such default or event continues for a period of time
sufficient to permit the acceleration of the maturity of any
indebtedness of the Company outstanding thereunder; or
(e) if any representation or warranty made by the Company in any
statement or certificate furnished by the Company to the Holder at
the time of the making of this Note or at any time in respect of
this Note is untrue or misleading in any material respect as of the
date of the issuance or making thereof; or
(f) default is made in the performance of any of other covenant,
agreement or condition herein contained or in any other agreement to
which the Holder and the Company are a party and such default shall
continue for fifteen (15) days after written notice thereof to the
Company by the Holder; or
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(g) the Company ceases or threatens to cease to carry on the business
currently being carried on by it or a substantial portion thereof or
makes or agrees to make an assignment, disposition or conveyance,
whether by way of sale or otherwise, of its assets in bulk or an
order is made for the winding-up of the Company; or
(h) the Company becomes insolvent or admits in writing its inability to
pay its debts as they mature or makes an assignment for the benefit
of creditors, or the Company applies for or consents to the
appointment of a trustee or receiver for the Company or for any part
of its property or a proposal is made by the Company or a petition
is filed by or against the Company or an authorized assignment is
made by the Company or an application is made under the Companies'
Creditors Arrangement Act or any successor or similar legislation;
or
(i) any one or more of a trustee, receiver and manager, custodian,
liquidator or other person with similar powers is appointed for the
Company or for any material part of its property and is not
discharged within thirty (30) days after such appointment; or
(j) final judgment or judgments for the payment of money aggregating in
excess of Ten Thousand Dollars ($10,000) is or are outstanding
against the Company or against any property or assets of the Company
and any one of such judgments has remained unpaid, unvacated,
unbonded or unstayed by appeal or otherwise for a period of thirty
(30) days from the date of its entry; or
(k) any material part of the property of the Company is seized or
otherwise attached by anyone pursuant to any legal process or other
means, including distress, execution or any other step or proceeding
with similar effect, and the same is not released, bonded,
satisfied, discharged or vacated within the period of ten (10) days
less than such period as would permit such property or any part
thereof to be sold pursuant thereto; or
(l) bankruptcy, reorganization, arrangement or insolvency proceedings,
or other proceedings for relief of debtors are instituted by or
against the Company and, if instituted against the Company, are
consented to or are not dismissed or stayed pending the resolution
of the matters in dispute within sixty (60) days after such
institution; or
(m) the Company takes any corporate proceedings for its dissolution or
liquidation or amalgamation with another company or if the corporate
existence of the Company shall be terminated by expiration,
forfeiture or otherwise.
When any Event of Default has occurred, or if the holder of any note or of
any other evidence of indebtedness of the Company gives any notice or takes any
other action with respect to a claimed default, the Company shall give written
notice within five (5) business days of such event to the Holder.
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When any Event of Default described in subsections (a) through (j)
inclusive has happened and is continuing, the Holder may, by notice in writing
sent by registered or certified mail to the Company, declare the entire
principal and all interest accrued on this Note to be and this Note shall
thereupon become, forthwith due and payable, without any presentment, demand,
protest or other notice of any kind, all of which are hereby expressly waived.
When any Event of Default described in subsection (k) has occurred, then this
Note shall immediately become due and payable without presentment, demand or
notice of any kind.
All notices, requests, consents and other communications hereunder shall
be in writing and shall be delivered by hand, by facsimile, by overnight mail or
mailed by first class certified or registered mail, return receipt requested,
posted prepaid, as follows:
Company: Mercantile Factoring & Credit Corp..
1250 Boul. Rene-Levesque Ouest,
Bureau 2925
Montreal, Quebec H3B 4W8
Attention: Mr. Dominique M. Bellemare, President
Facsimile No.: (514) 937-1994
Holder: Worldnet Connections, Inc.
1495 Ridgeview Drive, Suite 220
Reno, Nevada 89509
Attention: Rita S. Dickson, Secretary and Treasurer
Facsimile No.: (775) 827-6311
(or at such other address as may have been furnished in writing by either party
to the other), and such notices, requests, consents or other communications
shall be deemed to have been received when delivered, on the business day after
the date of the facsimile (with receipt confirmed), on the fifth day after being
mailed by overnight mail or on the third day after being mailed by first class
certified or registered mail, as the case may be.
For all purposes, "Holder" shall include the Holder's successors, assigns
or other nominees or attorneys duly appointed by instrument in writing.
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IN WITNESS WHEREOF the Company has executed and delivered this Note
on the date first set out above.
MERCANTILE FACTORING & CREDIT CORP.
by: _________________________________
Name
Title
by: _________________________________
Name
Title
CONVERSION FORM
TO:
The undersigned registered holder of the Note to which this Conversion
Form is attached hereby irrevocably elects to convert such Note into $.001 par
value common stock of Mercantile Factoring & Credit Corp. (the "Company Shares")
in accordance with the terms of such Note and directs that the Company Shares
issuable and deliverable upon the conversion be issued and delivered to the
person indicated below. (If Company Shares are to be issued in the name of a
person other than the Holder, all requisite transfer taxes must be tendered by
the undersigned.)
Dated:
(Signature of Registered Holder)
(Print name in which Company Shares issued on conversion are to be issued,
delivered and registered)
Name
(Address) (City, Province, and Postal Code)
Name of guarantor:
Authorized signature:
Dates Referenced Herein
| Referenced-On Page |
|---|
| This ‘10SB12G’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| Filed on: | | 11/15/99 | | | | | | | None on these Dates |
| | 7/30/99 | | 2 |
| List all Filings |
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