-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, MU2+Pm3rxl/P0qEjP2wEwZSRDCZUgKuYmx0Q+jgLr/TlAGYJZYJg/e7++2knplLO P1y3n6rJw9p7CEqRsfqAOg== 0001132072-03-000127.txt : 20030616 0001132072-03-000127.hdr.sgml : 20030616 20030616145306 ACCESSION NUMBER: 0001132072-03-000127 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20030601 ITEM INFORMATION: Acquisition or disposition of assets ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20030616 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ZIM CORP CENTRAL INDEX KEY: 0001124160 STANDARD INDUSTRIAL CLASSIFICATION: BLANK CHECKS [6770] IRS NUMBER: 651036706 STATE OF INCORPORATION: A6 FISCAL YEAR END: 0731 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-31691 FILM NUMBER: 03745382 BUSINESS ADDRESS: STREET 1: 20 COLONNADE ROAD STREET 2: SUITE 200 CITY: NEPEAN STATE: A6 ZIP: K2E 7M6 BUSINESS PHONE: 6137271397 MAIL ADDRESS: STREET 1: 20 COLONNADE ROAD STREET 2: SUITE 200 CITY: NEPEAN STATE: A6 ZIP: K2E 7M6 FORMER COMPANY: FORMER CONFORMED NAME: PRIVATE CAPITAL INVESTORS INC DATE OF NAME CHANGE: 20000920 8-K 1 s15-3671_8k.txt FORM 8-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. June 1, 2003 --------------------------------------------------- Date of Report (Date of earliest event reported) ZIM CORPORATION ----------------------------------------------------- (Exact name of registrant as specified in its charter) Canada 0-31691 None - ---------------------- ---------------- ---------------------- (State or jurisdiction (Commission File (IRS Employer I.D. No.) of incorporation or No.) organization) Incorporation) 20 Colonnade Road Suite 200 Nepean, Ontario Canada, K2E 7M6 (613)727-1397 ------------------------------- (Address and telephone number of principal executive offices) with copies to: Hank Gracin, Esq. Lehman & Eilen LLP 50 Charles Lindbergh Boulevard Suite 505 Tel: (516) 222-0888 Fax: (516) 222-0948 Item 2. Acquisition or Disposition of Assets On June 1, 2003, ZIM Corporation, a corporation governed by the Canada Business Corporations Act (the "Registrant"), consummated the merger (the "Merger") of Private Capital Investors, Inc., a Florida corporation ("Private Capital"), with and into PCI Merge, Inc., a Florida corporation and a wholly owned subsidiary of the Registrant (PCI Merge), with PCI Merge as the surviving entity. The Registrant also consummated on June 1, 2003 the amalgamation (the "Amalgamation") of ZIM Technologies International, Inc, a corporation governed by the Canada Business Corporations Act (ZIM Technologies), with PCI-ZTI Canada, Inc., a corporation governed by the Canada Business Corporations Act and a wholly owned subsidiary of the Registrant (PCI-ZTI), with PCI-ZTI as the surviving entity. As a result of the Merger and the Amalgamation, both Private Capital and ZIM Technologies became wholly owned subsidiaries of the Registrant. In the Merger, each outstanding share of common stock, par value $.001, of Private Capital was converted into a share of the Registrant. In the Amalgamation, each outstanding share of common stock, no par value, of ZIM Technologies was converted into a share of the Registrant. Effective June 1, 2003, PCI-ZTI changed its corporate name to ZIM Technologies. The Registrant filed a Registration Statement on Form S-4 under the Securities Act of 1933 (No. 333-100920), declared effective April 14, 2003 (the "Registration Statement"), registering the shares of the Registrant issued in both the Merger and the Amalgamation. The Registration Statement included a proxy statement for Private Capital in its solicitation of proxies to approve the Merger, and a proxy statement for ZIM Technologies in its solicitation of proxies to approve the Amalgamation. The Registrant's shares were registered pursuant to Section 12(b) of the Exchange Act. Pursuant to Rule 12g-3(a) under the Securities Exchange Act of 1934 (the "Exchange Act"), the Registrant is a successor to Private Capital and the Registrant's common shares are deemed to be registered under Section 12(b) of the Exchange Act. At a special meeting of the shareholders of Private Capital held on May 6, 2003, holders of a majority of the outstanding shares of Private Capital approved the merger of Private Capital with and into PCI Merge. At a special meeting of the shareholders of ZIM Technologies held on May 13, 2003, holders of a majority of the outstanding shares of ZIM Technologies approved the amalgamation of ZIM Technologies and PCI-ZTI. At a special meeting of the shareholders of the Registrant held on May 6, 2003, holders of a majority of the outstanding shares of the Registrant approved both the Merger and the Amalgamation. Effective June 1, 2003, the Registrant appointed Grant Thornton LLP as its public auditors. The Registrant has established that its fiscal year will end on May 31. Item 7. Financial Statements, Pro Forma Financial Information and Exhibits (a) Financial Statements of Businesses Acquired It is impracticable for the Registrant to file the financial information of the businesses acquired hereunder at this time, and such information will be filed by amendment to a Form 8-K reporting the consummation of the transactions described above under Item 2 within 60 days after the due date for the filing of that Form 8-K. (b) Pro Forma Financial Information It is impracticable for the Registrant to file the pro forma information of the businesses acquired hereunder at this time, and such information will be filed by amendment to a Form 8-K reporting the consummation of the transactions described above under Item 2 within 60 days after the due date for the filing of that Form 8-K. (c) Exhibits 2.1 Amended and Restated Acquisition Agreement dated as of October 28, 2002. 2.2 Amalgamation Agreement dated as of May 30, 2003. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized. ZIM CORPORATION (Registrant) Date: June 16, 2003 By: /S/ MICHAEL COWPLAND ---------------------------------- Michael Cowpland, President and Chief Executive Officer EXHIBIT INDEX Exhibit No. Exhibit - ----------- ------- Exhibit 2.1 Amended and Restated Acquisition Agreement dated as of October 28, 2002. Exhibit 2.2 Amalgamation Agreement dated as of May 30, 2003. EX-2 3 s15-3671_ex21.txt EXHIBIT 2.1 EXHIBIT 2.1 AMENDED AND RESTATED ACQUISITION AGREEMENT REINCORPORATION MERGER AGREEMENT dated as of October 28, 2002, by and among ZIM Corporation, a Canadian corporation (the ""Company""), PCI Merge, Inc., a Florida corporation and a subsidiary of the Company (""PCI Merge""), and Private Capital Investors, a Florida corporation (""Private Capital""). WHEREAS, the respective Boards of Directors of Private Capital, PCI Merge and the Company have approved the merger of PCI Merge into Private Capital and the other transactions contemplated hereby on the terms and subject to the conditions set forth herein; and WHEREAS, in furtherance thereof, upon the terms and subject to the conditions of this Agreement, (i) PCI Merge would be merged (the ""Merger"") with and into Private Capital in accordance with the Business Corporation Act of the State of Florida (the ""FBCA"") and (ii) each share of common stock, par value US$.001 per share, of Private Capital (collectively, the ""Shares""), issued and outstanding immediately prior to the Effective Time would, except as otherwise expressly provided herein, be converted into the right to receive the consideration issuable in the Merger (the ""Merger Consideration""). NOW, THEREFORE, in consideration of the foregoing and the respective representations, warranties, covenants and agreements set forth herein, Private Capital, PCI Merge and the Company agree as follows: ARTICLE I THE MERGER SECTION 1.01 The Merger. Upon the terms and subject to the satisfaction or waiver of the conditions hereof, and in accordance with the applicable provisions of this Agreement and the FBCA, at the Effective Time PCI Merge shall be merged with and into Private Capital. As of and following the Effective Time, the separate corporate existence of PCI Merge shall cease and Private Capital shall continue as the surviving corporation (the ""Surviving Corporation""). SECTION 1.02 Effective Time; Closing. As soon as practicable after the satisfaction or waiver of the conditions set forth in Article V, Private Capital and PCI Merge shall execute in the manner required by the FBCA and deliver to the Secretary of State of the State of Florida a duly executed and verified certificate of merger, and the parties shall take such other and further actions as may be required by law to make the Merger effective. The time the Merger becomes effective in accordance with applicable law is referred to as the ""Effective Time."" Prior to such filing, a closing (the ""Closing"") shall be held at the offices of Lehman & Eilen LLP, 50 Charles Lindbergh Boulevard, Suite 505, Uniondale, New York 11553, or such other place as the parties hereto shall agree, for the purpose of confirming the satisfaction or waiver of the conditions set forth in Article V. The date on which the Closing occurs is referred to herein as the ""Closing Date."" SECTION 1.03 Effects of the Merger; Subsequent Actions. The Merger shall have the effects set forth in the FBCA. Without limiting the generality of the foregoing, and subject thereto and any other applicable laws, at the Effective Time, all properties, rights, privileges, powers and franchises of Private Capital and PCI Merge shall vest in the Surviving Corporation, and all debts, liabilities, restrictions, disabilities and duties of Private Capital and PCI Merge shall become debts, liabilities, restrictions, disabilities and duties of the Surviving Corporation. SECTION 1.04 Certificate of Incorporation and By-Laws of the Surviving Corporation. (a) The Certificate of Incorporation of PCI Merge, as in effect immediately prior to the Effective Time, shall be the Certificate of Incorporation of the Surviving Corporation, until thereafter amended in accordance with the provisions thereof and hereof and applicable law; provided, however, that the name of the Surviving Corporation shall, in accordance with the provisions hereof and applicable law, be changed to ""ZIM U.S. Corporation"" at the Effective Time. (b) The By-Laws of PCI Merge in effect at the Effective Time shall be the By-Laws of the Surviving Corporation, until thereafter amended in accordance with the provisions thereof and hereof and applicable law. SECTION 1.0 Directors. Subject to applicable law, the directors of PCI Merge immediately prior to the Effective Time shall be the initial directors of the Surviving Corporation and shall hold office until their respective successors are duly elected and qualified, or their earlier death, resignation or removal. SECTION 1.06 Officers. The officers of PCI Merge immediately prior to the Effective Time shall be the initial officers of the Surviving Corporation and shall hold office until their respective successors are duly elected and qualified, or their earlier death, resignation or removal. SECTION 1.07 Conversion of Shares. At the Effective Time, by virtue of the Merger and without any action on the part of Private Capital, PCI Merge, the Company or the holders of the following securities, each Share issued and outstanding immediately prior to the Effective Time shall be converted into the right to receive the Merger Consideration. Such Shares shall be canceled by virtue of the Merger. As used herein, "Merger Consideration" means one common share of the Company, without par value. The parties hereto agree that each such common share of the Company shall not be transferable to a resident of Ontario for a period of not less than 90 days from the Effective Time and that the Exchange Agent shall be instructed not to register any such transfers during such period. SECTION 1.08 Conversion of MergeCo Common Stock. At the Effective Time, each share of common stock, par value US$.0001 per share, of PCI Merge issued and outstanding immediately prior to the Effective Time shall, by virtue of the Merger and without any action on the part of the holder thereof, be converted into and become one validly issued, fully paid and non-assessable share of common stock of the Surviving Corporation. SECTION 1.09 Outstanding Common Shares of the Company. All of the common shares of the Company outstanding immediately prior to the Effective Time shall, by virtue of the Merger, be canceled as of the Effective Time. SECTION 1.09A Securities Restriction. The Exchange Agent shall not register any transfer of the common shares of the Company to an Ontario resident for the period beginning on the Effective Time and ending on a date 90 days that is following the Effective Time. SECTION 1.10 Exchange of Certificates. (a) Prior to the Effective Time, the Company shall designate an Exchange Agent to act as exchange agent (the ""Exchange Agent"") in effecting the exchange for the Merger Consideration of certificates (the ""Certificates"") that, prior to the Effective Time, represented Shares. Upon the surrender of each such Certificate formerly representing Shares, together with a properly completed letter of transmittal described in Section 1.10(b) below, the Exchange Agent shall issue in respect thereof a common share certificate of the Company representing the Merger Consideration (a ""Company Certificate"") multiplied by the number of Shares formerly represented by each such Certificate, in exchange therefor, and each such Certificate shall forthwith be canceled. Until so surrendered and exchanged, each such Certificate shall represent solely the right to receive the Merger Consideration. If the Merger Consideration is to be delivered to any person other than the person in whose name the Certificate formerly representing Shares surrendered in exchange therefor is registered, it shall be a condition to such exchange that the Certificate so surrendered shall be properly endorsed or accompanied by a stock power and shall otherwise be in proper form for transfer and that the person requesting such exchange shall pay to the Exchange Agent any transfer or other taxes required by reason of the delivery of the Merger Consideration to a person other than the registered holder of the Certificate surrendered, or shall establish to the satisfaction of the Exchange Agent that such taxes have been paid or are not applicable. (b) Promptly after the Effective Time, the Exchange Agent shall mail to each record holder of Certificates that immediately prior to the Effective Time represented Shares a letter of transmittal and instructions for use in surrendering such Certificates and receiving the Merger Consideration in exchange therefor. (c) After the Effective Time, there shall be no transfers on the stock transfer books of the Surviving Corporation of any Shares. If, after the Effective Time, Certificates formerly representing Shares are presented to the Surviving Corporation or the Exchange Agent, they shall be canceled and exchanged for the Merger Consideration as provided in this Section 1.10. SECTION 1.11 Stockholders" Meeting. (a) Private Capital, acting through its Board of Directors (the ""Board""), shall, in accordance with the FBCA: (i) duly call, give notice of, convene and hold a special meeting of its stockholders (the ""Stockholders" Meeting"") as soon as practicable following the date hereof for the purpose of considering and taking action upon this Agreement; and (ii) subject to Article II below, prepare and file with the Securities and Exchange Commission (the ""SEC"") a preliminary proxy or information statement relating to the Merger and this Agreement and use all reasonable efforts (x) to obtain and furnish the information required by the SEC to be included in the Proxy Statement and, after consultation with the Company, to respond promptly to any comments made by the SEC with respect to the preliminary proxy or information statement and cause a definitive proxy or information statement (the ""Proxy Statement"") to be mailed to its stockholders and (y) to obtain the necessary approvals of the Merger and this Agreement by its stockholders. ARTICLE II REGISTRATION STATEMENT/PROXY STATEMENT Section 2.01 Private Capital and the Company shall jointly prepare and file with the SEC as soon as practicable after the date hereof a Registration Statement (the ""Registration Statement"") on Form S-4 under the Securities Act of 1933, as amended, with respect to the Merger Consideration issuable in the Merger and this Agreement, which Registration Statement shall also serve as the ""Proxy Statement"" for purposes of obtaining the approval of Private Capital"s stockholders to this Agreement. Private Capital and the Company shall use all reasonable efforts to have the Registration Statement declared effective by the SEC as promptly as practicable. Private Capital and the Company shall use all reasonable efforts to obtain, prior to the effective date of the Registration Statement, all necessary state securities law or ""Blue Sky"" permits or approvals required to carry out the transactions contemplated by this Agreement, and Private Capital will pay all expenses incident thereto. The Registration Statement, when declared effective by the SEC, will not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. Section 2.02 The Company, Private Capital and PCI Merge shall cooperate with one another in the preparation and filing of the Registration Statement and shall use their reasonable best efforts to promptly obtain and furnish the information required to be included in the Registration Statement and to respond promptly to any comments or requests made by the SEC with respect to the Registration Statement. Each party hereto shall promptly notify the other parties of the receipt of comments of, or any requests by, the SEC with respect to the Registration Statement and shall promptly supply the other parties with copies of all correspondence between such party (or its representatives) and the SEC (or its staff) relating thereto. The Company, Private Capital and PCI Merge each agrees to correct any information provided by it for use in the Registration Statement which shall have become, or is, false or misleading. Section 2.03 As soon as possible after completion of review of the Proxy Statement by the SEC, Private Capital shall mail the Proxy Statement to its stockholders who are entitled to vote at the Stockholders" Meeting. Subject to the fiduciary obligations of the Board under applicable law and the FBCA, the Proxy Statement shall contain the recommendation of the Board that the stockholders of Private Capital adopt this Agreement and the Merger. ARTICLE III CONDITIONS TO CONSUMMATION OF THE MERGER SECTION 3.01 Conditions to Each Party"s Obligation to Consummate the Merger. Subject to the right of any party hereto to waive any of the following conditions with respect to itself and not with respect to any other party, the respective obligations of Private Capital, PCI Merge and the Company to consummate the Merger and the transactions contemplated hereby are subject to the satisfaction, at or before the Effective Time, of each of the following conditions: SECTION 3.02 Stockholder Approval. The stockholders of Private Capital and PCI Merge shall have duly approved the transactions contemplated by this Agreement, and the stockholders of ZIM Technologies International, Inc. shall have approved the amalgamation of ZIM Technologies with PCI-ZTI Canada, Inc. SECTION 3.03 Injunctions, Illegality. No action, suit or proceeding shall be pending or threatened before any court or quasi-judicial or administrative agency of any federal, state, local or foreign jurisdiction or before any arbitrator or any governmental or regulatory authority, agency or other entity (a ""Governmental Entity"") wherein an unfavorable injunction, judgment, order, decree, ruling or charge would (i) prevent consummation of any of the transactions contemplated hereby, (ii) cause any of the transactions contemplated hereby to be rescinded following consummation, (iii) cause any of Private Capital, the Company, or any of their officers or directors, to become liable for any material damages, or (iv) affect adversely the right of the Surviving Corporation to own the former assets or to operate the former businesses of Private Capital (and no such injunction, judgment, order, decree, ruling or charge shall be in effect) and there shall not have been any statute, rule or regulation enacted, promulgated or deemed applicable to the Merger by any Governmental Entity which prevents the consummation of the Merger. SECTION 3.04 No Breach. There shall not have been a breach of any representation, warranty, covenant or agreement of the Company, PCI Merge or Private Capital set forth in this Agreement which, individually or in the aggregate, would have a material adverse effect on the Surviving Corporation. ARTICLE IV TERMINATION; AMENDMENT SECTION 4.01 Termination. This Agreement may be terminated and the Merger contemplated hereby may be abandoned at any time prior to the Effective Time, notwithstanding approval thereof by the stockholders of Private Capital, by action of the Company or the board of directors of Private Capital. SECTION 4.02 Effect of Termination. In the event of the termination of this Agreement pursuant to Section 4.01, this Agreement shall forthwith become void and have no effect, without any liability on the part of any party or its directors, officers or stockholders. SECTION 4.03 Amendment. This Agreement may be amended, modified or supplemented by written agreement of Private Capital and the Company at any time prior to the Effective Time, whether before or after the approval of this Agreement by the stockholders of Private Capital, but, after any such vote, no amendment, modification or supplement shall be made if the Board shall determine that such amendment, modification, supplement would have a material adverse effect on the rights of the holders of Shares without the further approval of such holders. ARTICLE V MISCELLANEOUS SECTION 5.01 Non-Survival of Representations and Warranties. The representations and warranties made in this Agreement shall not survive beyond the Effective Time. The covenants and other agreements contained herein shall survive in accordance with their respective terms. SECTION 5.02 Entire Agreement. This Agreement (including the documents and the instruments referred to herein) constitutes the entire agreement and supersedes all prior agreements and understandings, both written and oral, among the parties with respect to the subject matter hereof and thereof. SECTION 5.03 Validity. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, each of which shall remain in full force and effect. SECTION 5.04 Governing Law. The validity and enforceability of this Agreement shall be governed by and construed in accordance with the corporate law of the State of Florida, regardless of the laws that might otherwise govern under applicable principles of conflicts of laws thereof. SECTION 5.05 Descriptive Headings. The descriptive headings and captions herein are inserted for convenience of reference only and are not intended to be part of or to affect the meaning or interpretation of this Agreement. SECTION 5.06 Counterparts. This Agreement may be executed in two or more counterparts (including by means of telecopied signature pages), each of which shall be deemed to be an original, but all of which shall constitute one and the same agreement. SECTION 5.07 No Third Party Beneficiaries. Nothing in this Agreement, express or implied, is intended to nor shall confer upon any Person any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of this Agreement, and no Person shall be deemed a third party beneficiary under or by reason of this Agreement. IN WITNESS WHEREOF, each of the parties has caused this Agreement to be executed on its behalf by its respective officer thereunto duly authorized, all as of the day and year first above written. ZIM CORPORATION By: /s/ STUART D. COOPER ---------------------- STUART D. COOPER PRESIDENT PCI MERGE, INC. BY: /s/ STUART D. COOPER ------------------- STUART D. COOPER PRESIDENT PRIVATE CAPITAL INVESTORS, INC. BY: /s/ STUART D. COOPER ------------------- STUART D. COOPER PRESIDENT EX-2 4 s15-3671_ex22.txt EXHIBIT 2.2 EXHIBIT 2.2 AMALGAMATION AGREEMENT dated as of May 30, 2003. BETWEEN: ZIM Technologies International Inc., a corporation governed by the Canada Business Corporations Act, having its registered office in the City of Ottawa in the Province of Ontario, (hereinafter referred to as "ZIM Technologies") AND PCI-ZTI Canada, Inc., a corporation governed by the Canada Business Corporations Act and a wholly owned subsidiary of ZIM Corporation, having its registered office in the City of Ottawa in the Province of Ontario, (hereinafter referred to as "PCI-ZTI") AND ZIM Corporation, a corporation governed by the Canada Business Corporations Act, having its registered office in the City of Ottawa in the Province of Ontario. (hereinafter referred to as "ZIM Corporation") WHEREAS ZIM Corporation was incorporated pursuant to the laws of Canada on October 17, 2002 with authorized capital consisting of an unlimited number of common shares of which one is currently issued and outstanding and an unlimited number of special shares of which none are currently issued and outstanding; AND WHEREAS PCI-ZTI was incorporated pursuant to the laws of Canada on September 17, 2002 with authorized capital consisting of an unlimited number of common shares of which one common share is currently issued and outstanding; AND WHEREAS the parties hereto have determined that it is desirable that ZIM Technologies and PCI-ZTI should amalgamate under the authority contained in the Canada Business Corporations Act, and continue as one corporation upon the terms and conditions hereinafter set out. NOW THEREFORE, in consideration of the premises and the mutual covenants and agreements herein contained (the adequacy of which is hereby mutually admitted), the parties hereto have agreed as follows: ARTICLE ONE INTERPRETATION 1.01 DEFINITIONS. Whenever used in this Agreement, the following terms shall have the respective meanings ascribed to them as follows: (a) "Act" means the Canada Business Corporations Act as heretofore enacted or as the same may from time to time be amended or re-enacted, or any other legislation hereafter enacted in substitution therefor or replacement thereof, and includes any regulations heretofore or hereafter made pursuant to such Act or other legislation, and any term defined in the Act and not otherwise defined herein is used in this Agreement with the same meaning; (b) "Amalgamating Corporations" mean ZIM Technologies and PCI-ZTI; (c) "Amalgamated Corporation" means the corporation continuing from the amalgamation of the Amalgamating Corporations; (d) "Amalgamation Agreement" or "Agreement" means this Amalgamation Agreement; (e) "Articles" means the articles of amalgamation by which the Amalgamated Corporation is incorporated as a result of this Agreement; (f) "Business Day" means any day other than a Saturday, Sunday or civic or statutory holiday in the City of Ottawa; (g) "Certificate of Amalgamation" means the certificate of amalgamation issued by the Director in respect of the Amalgamation; (i) "Common Shares" means the common shares of the Amalgamated Corporation, the rights, privileges, restrictions and conditions attaching to such shares being as set forth in Section 3.06 herein; (j) "Director" means the Director appointed under the Act; (k) "Dissenting Shareholder" means a holder of ZIM Corporation Shares or ZIM Technologies Shares, as the case may be, who has exercised its right of dissent in respect of the special resolution authorizing the amalgamation in strict compliance with section 190 of the Act and has been paid fair value in accordance therewith; (n) "Effective Date" means the date of the Certificate of Amalgamation which is shall be June 1, 2003; (o) "Expiry Time" means 5:00 p.m. (Ottawa time) on that date which is 30 days following the Effective Date; (p) "PCI-ZTI Shares" means the issued and outstanding common shares of PCI-ZTI; (q) "Share Provisions" means the rights, privileges, restrictions and conditions attaching to the Common Shares being as set forth in Schedule "I" attached hereto; (r) "ZIM Corporation Common Shares" means the common shares of ZIM Corporation; (s) "ZIM Corporation Shares" means the common shares and special shares of ZIM Corporation; (t) "ZIM Corporation Special Shares" means the special shares of ZIM Corporation; (u) "ZIM Technologies Common Shares" means the common shares of ZIM Technologies; (v) "ZIM Technologies Shares" means the common shares and special shares of ZIM Technologies; and (w) "ZIM Technologies Special Shares" means special shares of ZIM Technologies. ARTICLE TWO IMPLEMENTATION 2.01 IMPLEMENTATION. The Amalgamating Corporations and each of them do hereby agree to amalgamate under the provisions of the Act effective immediately upon the commencement of the 1st day of June, 2003, under the terms and conditions hereinafter set out. After this Agreement has become effective, subject to Section 2.02 hereof, Articles of Amalgamation in prescribed form shall be delivered to the Director, together with all other documents necessary to bring the amalgamation into effect. 2.02 TERMINATION. Notwithstanding the approval of this Agreement by the shareholders of the Amalgamating Corporations, the Board of Directors of any of the Amalgamating Corporations may, without further shareholder approval, terminate the amalgamation and this Agreement at any time before the issuance of a Certificate of Amalgamation. ARTICLE THREE ORGANIZATION 3.01 NAME. The name of the Amalgamated Corporation shall be ZIM Technologies International Inc. 3.02 REGISTERED OFFICE. The registered office of the Amalgamated Corporation shall be in the City of Ottawa in the Province of Ontario. Until changed in accordance with the provisions of the Act, the address of the Registered Office shall be 200-20 Colonnade Road, Ottawa, Ontario, K2E 7M6. 3.03 NUMBER OF DIRECTORS. The number of directors of the Amalgamated Corporation, until changed in accordance with the provisions of the Act, shall be a minimum of 1 and a maximum of 10. 3.04 DIRECTORS. The first directors of the Amalgamated Corporation shall be: NAME RESIDENTIAL ADDRESS RESIDENT CANADIAN ---- ------------------- ----------------- Jim Stechyson 5597 Goddard Street Yes Manotick, ON K4M 1C5 Steve Houck 608-1409 South Lamar Street No Dallas, TX USA 75215 Charles Saikaley 119 Kamloops Avenue Yes Ottawa, ON K1V 7C8 3.05 RESTRICTIONS ON BUSINESS. There shall be no restrictions on the business of the Amalgamated Corporation or on the powers that the Amalgamated Corporation may exercise. 3.06 AUTHORIZED CAPITAL. The Amalgamated Corporation is authorized to issue an unlimited number of Common Shares and the rights, privileges, restrictions and conditions attaching to such shares are as set forth in Schedule "I" attached hereto. 3.07 RESTRICTED TRANSFER. The right to transfer shares in the capital stock of the Amalgamated Corporation shall be restricted and no shares shall be transferred without either: (a) the consent of the majority of the directors of the Amalgamated Corporation expressed by a resolution passed by the board of directors; or (b) the consent of the holders of the common shares for the time being outstanding expressed by a resolution passed by such shareholders. 3.08 OTHER PROVISIONS. The other provisions to be included in the Articles of Amalgamation shall be as follows: (a) the number of shareholders of the Amalgamated Corporation exclusive of persons who are in its employment and exclusive of persons who, having been formerly in the employment of the Amalgamated Corporation, were, while in that employment, and have continued after the termination of that employment to be, shareholders of the Amalgamated Corporation, is limited to not more than 50, two or more persons who are the joint registered owners of one or more shares being counted as one shareholder; (b) any invitation to the public to subscribe for the securities of the Amalgamated Corporation shall be prohibited; (c) the board of directors may from time to time, without authorization of the shareholders, in such amounts and on such terms as it deems expedient: (i) borrow money on the credit of the Amalgamated Corporation; (ii) issue, reissue, sell or pledge debt obligations (secured or unsecured) of the Amalgamated Corporation; (iii) give a guarantee on behalf of the Amalgamated Corporation to secure performance of an obligation of any person or body corporate; and (iv) charge, mortgage, hypothecate, pledge, cede and transfer or otherwise create a security interest in all or any of the currently owned or subsequently acquired real or personal, movable or immovable, property of the Amalgamated Corporation, including book debts, rights, powers, franchises and undertaking, to secure any debt obligations or any money borrowed, or other debt or liability of the Amalgamated Corporation; and (d) the board of directors may from time to time delegate to such one or more directors and officers of the Amalgamated Corporation as may be designated by the board all or any of the powers conferred on the board pursuant to subparagraph (c) above to such extent and in such manner as the board of directors shall determine at the time of each such delegation. (e) the number of directors of the Corporation within the minimum and maximum numbers of directors provided for in the articles of the Corporation shall be as determined from time to time by ordinary resolution of the shareholders of the Corporation or, if the ordinary resolution empowers the directors to determine such number, by resolution of the directors of the Corporation. (f) The directors of the Corporation may appoint one or more directors, who shall hold office for a term expiring not later than the close of the next annual meeting of shareholders of the Corporation, but the total number of directors so appointed shall not exceed one third of the number of directors elected at the previous annual meeting of shareholders of the Corporation. (g) the Amalgamated Corporation shall have a lien on the shares registered in the name of a shareholder or his legal representative for a debt of that shareholder to the Amalgamated Corporation. ARTICLE FOUR ISSUED CAPITAL 4.01 EXCHANGE OF SHARES. At the time the Amalgamation becomes effective: (a) each PCI-ZTI Share shall be exchanged for issued and fully paid Common Shares of the Amalgamated Corporation on the basis of one (1) Common Share of the Amalgamated Company for one (1) PCI-ZTI Share; (b) each ZIM Technologies Common Share other than those held by Dissenting Shareholders shall be exchanged for issued and fully paid ZIM Corporation Common Shares on the basis of one (1) ZIM Corporation Common Share for one (1) ZIM Technologies Common Share; (c) each ZIM Technologies Special Share other than those held by Dissenting Shareholders shall be exchanged for issued and fully paid ZIM Corporation Special Shares on the basis of one (1) ZIM Corporation Special Share for one (1) ZIM Technologies Special Share; (d) each ZIM Technologies Share held by Dissenting Shareholders tendered for cancellation in accordance with the provisions of section 190 of the Act shall be cancelled; (e) all ZIM Technologies Shares which have been exchanged or tendered in accordance with this section 4.01 shall thereupon be cancelled; and (f) all authorized but unissued shares in the capital of PCI-ZTI and ZIM Technologies shall be cancelled. 4.02 FRACTIONAL SHARES. No fractional shares of ZIM Corporation will be issued to any holder of ZIM Technologies Shares. In lieu thereof such shareholders shall receive a whole ZIM Corporation Share. 4.03 SHARE CERTIFICATES. After the Effective Date: (a) the holders of ZIM Technologies Shares (other than Dissenting Shareholders holding such shares) shall be entitled to receive certificates representing ZIM Corporation Shares on the basis provided for in sections 4.01 and 4.02 hereof on presentation and surrender for cancellation of the certificates representing the ZIM Technologies Shares held by them, or such other properly executed documentation as the Amalgamated Corporation may request in lieu of such certificates, at the office of ZIM Corporation; and (b) the holders of PCI-ZTI Shares (other than Dissenting Shareholders holding such shares) shall be entitled to receive certificates representing Common Shares on the basis provided for in section 4.01 on presentation and surrender for cancellation of the certificates representing the PCI-ZTI Shares held by them, or such other properly executed documentation as the Amalgamated Corporation may request in lieu of such certificates at the office of the Amalgamated Corporation. 4.04 DISSENTING SHAREHOLDER. Notwithstanding anything in this Agreement to the contrary, ZIM Technologies Shares, in respect of which a Dissenting Shareholder shall dissent shall not, at the Effective Date, be converted into ZIM Corporation Shares as provided in Sections 4.01 and 4.02 hereof, and no ZIM Corporation Shares shall be issued to such Dissenting Shareholder, as provided in Sections 4.01 and 4.02 hereof; provided however, that in the event that a Dissenting Shareholder who has exercised the right of dissent under section 190 of the Act fails to perfect or withdraws or forfeits his or her right to make a claim under section 190 of the Act or his or her rights as a shareholder are otherwise reinstated such shareholder's ZIM Technologies Shares shall thereupon be deemed to have been exchanged as at the Effective Date into ZIM Corporation Shares as provided in Sections 4.01 and 4.02 hereof, and ZIM Corporation shall be deemed to have issued to such shareholder as at the Effective Date ZIM Corporation Shares as provided in Sections 4.01 and 4.02 hereof. 4.05 STATED CAPITAL. The aggregate stated capital of each class of shares in the capital of the Amalgamated Corporation shall be equal to the aggregate stated capital of the class(es) of shares in the capital of the Amalgamating Corporations which it replaced immediately before such amalgamation becomes effective. ARTICLE FIVE MISCELLANEOUS 5.01 ARTICLES. Upon the shareholders of ZIM Technologies and PCI-ZTI approving this Agreement in accordance with the provisions of the Act and the obtaining of all other consents or orders of all regulatory authorities, federal, provincial, domestic or foreign, ZIM Technologies and PCI-ZTI shall forthwith complete and send to the Director the Articles in prescribed form and such other related documents as may be required pursuant to the Act or any other regulatory authority. 5.02 FURTHER ASSURANCES. The parties hereto shall with reasonable diligence do all things and provide all reasonable assurances as may be required to complete the transactions contemplated by this Agreement, and each party hereto shall provide such further documents or instruments required by any other party as may be reasonably necessary or desirable to give effect to this Agreement and to carry out its provisions. 5.03 AMENDMENT. This Agreement may be amended by an agreement in writing signed by each of the parties hereto, provided that the amendment is approved by a special resolution of the shareholders of each Amalgamating Corporation. 5.04 GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the laws of Ontario and the federal laws of Canada applicable therein. 5.05 BY-LAWS. The by-laws of PCI-ZTI shall, so far as applicable, be the by-laws of the Amalgamated Corporation, until repealed, amended, altered or added to and a copy of such by-laws may be examined at the registered office address of the Amalgamated Corporation. IN WITNESS WHEREOF this Amalgamation Agreement has been duly executed by the parties hereto as witnessed by the signatures of their proper officers in that behalf. ZIM TECHNOLOGIES INTERNATIONAL INC. By: /s/ Michael Cowpland -------------------------------------- Michael Cowpland President PCI-ZTI CANADA, INC. By: /s/ Stuart D. Cooper -------------------------------------- Stuart D. Cooper President ZIM CORPORATION By: /s/ Stuart D. Cooper ------------------------------------- Stuart D. Cooper President -----END PRIVACY-ENHANCED MESSAGE-----