<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
VIRTUAL TECHNOLOGY CORPORATION
(Exact name of Registrant as Specified in its Charter)
MINNESOTA
(State of Incorporation)
IRS EIN #41-1639011
(I.R.S. Employer Identification Number)
3100 WEST LAKE STREET, SUITE 400
MINNEAPOLIS, MN 55416
(612)915-1122
(Address, including zip code and
telephone number, including area code, or
registrant's principal executive offices)
1999 DONNA MILLER CONSULTING PLAN
(Full Title of the Plan)
Messerli & Kramer P.A.
Attention: Jeffrey C. Robbins, Esq.
150 South Fifth Street, Suite 1800
Minneapolis, MN 55402
(612) 672-3600
(Name, address, including zip code and telephone number,
including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed Proposed
Amount maximum maximum
Title of securities to to be offering price aggregate Amount of
be registered registered per unit offering price registration fee
------------- ----------- -------- -------------- ----------------
<S> <C> <C> <C> <C>
Common Stock, 400,000 $5.00 $2,000,000 $566.00
no par value
</TABLE>
<PAGE> 2
Part II
Item 3.
The following documents are incorporated herein by reference:
(a) (1) The Form 10-K of Virtual Technology Corporation, filed with the SEC
on May 6, 1999.
(2) The Form 10-SB of Virtual Technology Corporation, filed with the SEC on
February 12, 1999.
(b) All reports and other documents subsequently filed by the Company pursuant
to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act prior to the filing
of a post-effective amendment which indicates that all securities offered have
been sold or which deregisters all securities then remaining unsold, shall be
deemed to be incorporated by reference herein and to be a part of this
registration statement from the date of the filing of such reports and
documents.
(c) (i) Form of Common Stock Certificate, see Exhibit 3(a) for the Form 10-SB of
Virtual Technology Corporation, filed February 12, 1999; and (ii) Form of Stock
Purchase Warrant, see Exhibit 3(b) of the Form 10-SB of Virtual Technology
Corporation, filed February 12, 1999.
Item 4. Description of Securities.
Not Applicable.
Item 5. Interests of Named Experts and Counsel.
The legality of the Common Stock offered hereby will be passed upon for
the Company by Messerli & Kramer P.A. of Minneapolis, Minnesota ("Messerli &
Kramer"). As of the date of this prospectus, Messerli & Kramer owns 27,500
shares of the Registrant's Common Stock.
Item 6. Indemnification of Directors and Officers.
The Bylaws of the Company and the statutes of the State of Minnesota
give the Company the power to indemnify any director, officer, employee, or
agent who was or is a party to any threatened, pending, or completed action,
suit, or proceeding, whether civil, criminal, administrative, or investigative,
against certain liabilities and expenses incurred in connection with the action,
suit, or proceeding. The Bylaws of the Company provide that the Company shall
indemnify any such directors, officers, employees, or agents to the full extent
provided under applicable provisions of the Minnesota Statutes. These provisions
do not affect the availability of equitable remedies, such as an action to
enjoin or rescind a transaction involving a breach of fiduciary duty, although,
as a practical matter, equitable relief may not be available. In the opinion of
the Securities and Exchange Commission, such indemnification is against public
policy as expressed in the Securities Act. As a result, the above provisions may
not limit liability of the directors for violations of, or relieve them from the
necessity of complying with, the federal securities laws.
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<PAGE> 3
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
EXHIBIT NUMBER
1.* Amended and Restated Certificate of Incorporation of the Company.
2.* Amended and Restated Bylaws of the Company.
5. Opinion of Messerli & Kramer P.A.
23.1 Consent of Lurie, Besikof, Lapidus & Co., LLP.
23.2 Consent of Copeland Buhl & Co. PLLP.
23.3 Consent of Samuel T. Kantos.
24 Power of Attorney is contained on the signature pages.
99.1 Consulting Agreement
- -------------
* Documents incorporated by reference from the Company's Registration
Statement on Form 10-SB, filed with the SEC on February 12, 1999.
Item 9. Undertakings.
UNDERTAKINGS
1. The undersigned registrant hereby undertakes:
(a) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement. 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 end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule
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<PAGE> 4
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, and (iii) To 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)(i) and (a)(ii) do not apply if
the information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the issuer pursuant to
section 13 or section 15(d) of the Exchange Act that are incorporated by
reference herein.
(b) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(c) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
2. The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement shall be deemed to be a
new registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
3. Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has 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. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
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<PAGE> 5
Signatures
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Minneapolis, State of Minnesota, on May 11, 1999.
VIRTUAL TECHNOLOGY CORPORATION
/s/ Greg Appelhof
-------------------------------------------
By: Greg Appelhof
Its: President and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Greg Appelhof and Kenneth Israel and each
or any one of them, his true and lawful attorney-in-fact and agent, with full
power of substitution and resubstitution, for him and in his name, place and
stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) to this Registration Statement, and to file the same,
with all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in connection therewith,
as fully to all intents and purposes as he might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitutes or substitute, may lawfully do or cause to be
done by virtue hereof.
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed by the following persons in the capacities and on the
dates indicated.
SIGNATURE TITLE
/s/ Kenneth Israel Chairman of the Board
- ------------------------
Kenneth Israel
Date: May 11, 1999
-------------------
/s/ John Harvatine Chief Financial Officer (Principal
- ------------------------ Financial and Accounting Officer)
John Harvatine
Date: May 11, 1999
-------------------
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<PAGE> 6
/s/ Jeff Maynard Director
- ------------------------
Jeff Maynard
Date: May 11, 1999
-------------------
/s/ Greg Appelhof President, Chief Executive Officer and
- ------------------------ Director (Principal Executive Officer)
Greg Appelhof
Date: May 11, 1999
-------------------
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<PAGE> 1
EXHIBIT 5
[MESSERLI & KRAMER LETTERHEAD]
May 11, 1999
Virtual Technology Corporation
3100 West Lake Street
Minneapolis, MN 55416
RE: VIRTUAL TECHNOLOGY CORPORATION - ISSUANCE OF SECURITIES
OUR FILE NO. 11041/1
Ladies and Gentlemen:
You have requested our opinion with respect to certain matters in
connection with the filing by Virtual Technology Corporation, (the "Company") of
a Registration Statement on Form S-8 (the "Registration Statement") with the
Securities and Exchange Commission covering the sale of 400,000 shares of the
Company's Common Stock, no par value (the "Shares"), that will be issued
pursuant to the 1999 Consulting Agreement with Donna Miller ("Miller") (the
"Consulting Agreement.")
In connection with this opinion, we have examined the Registration
Statement, the Company's restated Articles of Incorporation and By-laws, and
such other documents, records, certificates, memoranda and other instruments as
we deem necessary as a basis for this opinion. We have assumed the genuineness
and authenticity of all documents submitted to us as originals, the conformity
to originals of all documents submitted to us as copies thereof, and the due
execution and delivery of all documents, where due execution and delivery are a
prerequisite to the effectiveness thereof.
On the basis of the foregoing, and in reliance thereon, we are of the
opinion that the Shares, when sold and issued in accordance with the Consulting
Agreement and the Registration Statement, will be validly issued, fully paid,
and nonassessable.
We consent to the filing of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
MESSERLI & KRAMER P.A.
/s/MESSERLI & KRAMER P.A.
<PAGE> 1
EXHIBIT 23.1
INDEPENDENT AUDITOR'S CONSENT
We consent to the incorporation by reference in this Registration Statement of
Virtual Technology Corporation on Form S-8 of our reports dated April 23, 1999,
appearing in the Annual Report on Form 10-K of Virtual Technology Corporation
for the year ended January 31, 1999.
/s/ LURIE, BESIKOF, LAPIDUS & CO., LLP
Minneapolis, Minnesota
May 13, 1999
<PAGE> 1
EXHIBIT 23.2
May 11, 1999
INDEPENDENT AUDITOR'S CONSENT
We hereby consent to the incorporation by reference in this Registration
Statement of Virtual Technology Corporation on Form S-8 of our report dated
April 11, 1997, appearing in the Company's Registration Statement on Form 10-K
filed May 6, 1999.
/s/ COPELAND, BUHL & COMPANY, P.L.L.P.
Wayzata, Minnesota
<PAGE> 1
EXHIBIT 23.3
INDEPENDENT AUDITOR'S CONSENT
We consent to the incorporation by reference in this Registration Statement of
Virtual Technology Corporation on Form S-8 of our reports dated February 10,
1999 and April 23, 1999, appearing in the Registration Statement on Form 10-K
filed May 6, 1999.
/s/ SAMUEL T. KANTOS AND ASSOCIATES
Minneapolis, Minnesota
May 11, 1999
<PAGE> 1
EXHIBIT 99.1
CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT (this "Agreement") is entered into as of May
10, 1999 by and between Virtual Technology Corporation, a Minnesota corporation
("VTC" or the "Company"), and Donna Miller (the "Consultant").
R E C I T A L S:
A. VTC is a public company whose Common Stock, no par value, is quoted
on the OTC Bulletin Board. VTC is in the business of selling computers and
computer-related equipment on the Internet and through wholesale distribution.
B. VTC wishes to engage the Consultant on a nonexclusive basis as an
independent contractor to utilize Consultant's services to further develop and
refine its strategic marketing plans.
NOW, THEREFORE, it is mutually agreed by and between the parties as
follows:
1. ENGAGEMENT. VTC hereby retains and engages the Consultant to evaluate and
assist in the development of strategic marketing plans as described in more
detail in Section 2 below (the "Consulting Services"), and the Consultant agrees
to perform the Consulting Services subject to the terms and conditions of this
Agreement.
2. CONSULTING SERVICES. The consulting services contemplated by this Agreement
(the "Consulting Services") shall consist of:
(a) reviewing and evaluating VTC's current business plan and remaining
knowledgeable about the contents thereof;
(b) working with VTC's management to develop and prepare a detailed strategic
co-branding and/or partnership marketing plan with one or more Internet
marketing organizations and/or major credit card issuers;
(c) working with VTC's management to periodically revise the VTC strategic
marketing plan as required during the term of this Agreement; and
(d) providing introductions to computer/computer resale industry contacts.
3. DUTIES EXPRESSLY EXCLUDED. This Agreement expressly excludes the Consultant
from providing any and all capital formation and/or public relations services to
the Company inclusive of, but not limited to: (i) direct or indirect promotion
of, or maintaining of a market in, the Company's securities, (ii) assistance in
obtaining debt and/or equity financing or any other capital-raising transactions
or (iii) investor relations or shareholder communications services.
<PAGE> 2
4. CONSIDERATION. In consideration of the performance by the Consultant of the
Consulting Services, VTC will issue to the Consultant 400,000 shares of VTC's
Common Stock (the "Shares") for a total consideration of $2,000,000. In
addition, if during the Term hereof, the Consultant secures an affiliate
marketing relationship acceptable to VTC with VISA International, Inc. ("VISA"),
then as a bonus for services rendered, VTC shall, within 30 days after entering
into any such agreement with VISA, issue to the Consultant an additional 100,000
Shares (the "Bonus Shares"). In the event that the Consultant does not
completely perform the Consulting Services (for any reason including the death
or incapacity of the Consultant), then for each month that the Consultant does
not perform the Consulting Services, one-twelfth (1/12th) of the Shares
(including any Bonus Shares outstanding at such time and in any case as adjusted
for stock splits, reverse stock splits, stock dividends or distributions or
other reclassifications of VTC's Common Stock) shall be returned to VTC and
canceled. The Consultant agrees to purchase Shares in the open market, if
necessary, to fulfill such obligation to return Shares to VTC.
The initial 400,000 Shares will be issued as soon as practicable following
execution of this Agreement and the filing of a registration statement under the
Securities Act of 1933, as amended, on Form S-8 covering the original issuance
of such Shares. In the event that the Consultant earns the Bonus Shares during
the Term hereof, VTC agrees to use its best efforts to file a registration
statement on Form S-8 covering the original issuance of such Shares.
5. EXPENSES. Consultant shall bear her out-of-pocket costs and expenses
incident to performing the Consulting Services, without a right of reimbursement
by VTC.
6. TERM. The term of this Agreement is one year, commencing on the date hereof
(the "Term"). This Agreement may be terminated prior to the end of the Term upon
the mutual written agreement of the parties or in the event the Consultant is in
default (as defined below) in the performance of the Consulting Services, which
default is not cured within a reasonable time following written notice thereof
from VTC. A "default" occurs when, in VTC's sole and exclusive judgment, the
Consultant is not satisfactorily performing the Consulting Services.
7. CONSULTANT'S LIABILITY. In the absence of gross negligence or willful
misconduct on the part of the Consultant or the Consultant's breach of any term
of this Agreement, the Consultant shall not be liable to the Company, or to any
officer, director, employee, shareholder or creditor of the Company, for any act
or omission in the course of or in connection with the rendering or providing of
services hereunder. Except in those cases where gross negligence or willful
misconduct of the Consultant or the breach by the Consultant of any terms of
this Agreement is alleged and proven, the Company agrees to defend, indemnify,
and hold the Consultant harmless from and against any and all reasonable costs,
expenses and liability (including reasonable attorneys' fees paid in the defense
of the Consultant) which may in any way result from services rendered by the
Consultant pursuant to or in connection with this Agreement. This
indemnification expressly excludes any and all damages as a result of any
actions taken or omissions or statements made by the Consultant without the
prior approval or authorization of the Company or which are otherwise in
violation of applicable law.
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<PAGE> 3
8. COMPANY'S LIABILITY. The Consultant agrees to defend, indemnify, and hold
the Company and its officers, directors, employees and shareholders harmless
from and against any and all reasonable costs, expenses and liability (including
reasonable attorneys' fees paid in defense of the Company and/or its officers,
directors, employees and/or shareholders) which may in any way result pursuant
to her gross negligence or willful misconduct or in any connection with any
actions taken or omissions or statements made without the prior approval or
authorization of the Company or which are otherwise in violation of applicable
law.
9. CONSULTANT'S REPRESENTATIONS. The Consultant makes the following
representations:
(a) The Consultant has no prior or existing legally binding obligations that
are in conflict with her entering into this Agreement;
(b) The Consultant shall not offer or make payment of any consideration to
brokers, dealers, or others for purposes of inducing the purchase, making of a
market or recommendation for the purchase of the Company's securities;
(c) The Consultant is not currently the subject of an investigation or inquiry
by the Securities and Exchange Commission, the NASD or any state securities
commission;
(d) The Consultant's activities and operations fully comply with now and will
comply with in the future all applicable state and federal securities laws and
regulations;
(e) The Consultant is either properly registered as, or exempt from
registration, a broker-dealer or an investment advisor;
(f) The Consultant understands that, as a result of her services, she may come
to possess material non-public information about the Company, and she has
implemented internal control procedures designed to reasonably to insure that
neither she nor any of her employees, agents, consultants or affiliates trade in
the securities of the Company while in possession of material non-public
information;
(g) During the Term of this Agreement and for a period of five years
thereafter, the Consultant shall treat as the Company's confidential trade
secrets all data, information, ideas, knowledge and papers pertaining to the
affairs of the Company. Without limiting the generality of the foregoing, such
trade secrets shall include, without limitation: the Company's business and
marketing plans; the identity of the Company's customers, suppliers and
prospective customers and suppliers; the identity of the Company's marketing
partners; the identity of the Company's creditors and other sources of
financing; the Company's estimating and costing procedure and the cost and gross
prices charged by the Company for its products; the prices or other
consideration charged to or required of the Company by any of the suppliers or
potential suppliers; and the Company's sales and promotional policies. The
Consultant shall not reveal such trade secrets to others except in the proper
exercise of her duties for the Company, or use her knowledge thereof in any way
that would be detrimental to the interest of the Company unless compelled to
disclose such information
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<PAGE> 4
by judicial or administrative process. Despite the above, the divulging of
information shall not be a breach of this Agreement to the extent that such
information was (i) previously known by the party to which it is divulged, (ii)
already in the public domain, all through no fault of the Consultant, or (iii)
required to be disclosed by the Consultant pursuant to judicial or governmental
order (as to which case, the Consultant shall promptly notify VTC of any request
for information so that VTC can determine whether to seek a protective order as
to such information). The Consultant shall also treat all information pertaining
to the affairs of the Company's suppliers and customers and prospective
customers and suppliers as confidential trade secrets of such customers and
suppliers and prospective customers and suppliers; and
(h) The Consultant agrees to notify the Company immediately if, at any time,
any of the representations and warranties made by the Consultant herein are no
longer true and correct or if a breach of any of the representations and
warranties made by the Consultant herein occurs.
10. COMPANY REPRESENTATIONS. The Company makes the following representations:
(a) The Company is in good standing in under the laws of the State of
Minnesota.
(b) The issuance of the Shares has been authorized by VTC's Board of Directors
and, when issued, will be fully paid and nonassessable.
11. ENTIRETY OF AGREEMENT. This Agreement sets forth the entire understanding
of the parties with respect to the matters contemplated hereby. Any and all
previous agreements and understandings between or among the parties of any kind,
whether written or oral, are superseded by this Agreement. This Agreement shall
not be amended or modified except by written instrument duly executed by each of
the parties.
12. ASSIGNMENT AND BINDING EFFECT. This Agreement may not be assigned without
the prior written consent of the other party.
13. WAIVER. Any term or provision of this Agreement may be waived at any time
by the party entitled to the benefit thereof by a written instrument duly
executed by such party.
14. NOTICES. Any notice, request, demand, waiver, consent, approval or other
communication which is required or permitted hereunder shall be in writing and
shall be deemed given only if delivered personally or sent by facsimile, or by
registered or certified mail, postage prepaid, as follows:
If to VTC to:
Virtual Technology Corporation
3100 West Lake Street, Suite 400
Minneapolis, Minnesota 55416
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<PAGE> 5
If to Consultant, to:
Donna Miller
15303 Pembrooke Point
Naples, Florida 34110
or to such other address as the addressee may have specified in a notice duly
given to the sender as provided herein. Such notice, request, demand, waiver,
consent, approval or other communications will be deemed to have been given as
of the date so delivered, telephoned or mailed.
15. GOVERNING LAW. This Agreement shall be governed by and interpreted and
enforced in accordance with the laws of the State of Minnesota, exclusive of its
conflict of laws rules.
16. NO BENEFIT TO OTHERS. The representations, warranties, covenants and
agreements contained in this Agreement are for the sole benefit of the parties
hereto.
17. SEVERABILITY. Any provision of this Agreement that is invalid or
unenforceable in any jurisdiction shall be ineffective to the extent of such
invalidity or unenforceability in such jurisdiction without invalidating or
rendering unenforceable the remaining provisions hereof, and any such invalidity
or unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
18. HEADINGS. The headings of this Agreement are inserted solely for the
convenience of reference and are not part of, and are not intended to govern,
limit or aid in the construction of any term or provision hereof.
19. FURTHER ACTS. Each party agrees to perform any further acts and execute and
deliver any further documents that may be reasonably necessary to carry out the
provisions and intent of this Agreement.
20. ACKNOWLEDGMENT CONCERNING COUNSEL. Each party acknowledges that it had the
opportunity to employ separate and independent counsel of its own choosing in
connection with this Agreement.
21. INDEPENDENT CONTRACTOR STATUS. There is no relationship, partnership,
agency, employment, franchise or joint venture between the parties. The parties
have no authority to bind the other or incur any obligations on their behalf.
22. COUNTERPARTS. This Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
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<PAGE> 6
IN WITNESS WHEREOF, the undersigned have hereunto affixed their signatures.
VIRTUAL TECHNOLOGY CORPORATION CONSULTANT
By /s/ KENNETH ISRAEL /s/ DONNA MILLER
---------------------------- ------------------------------
Kenneth Israel, Chairman Donna Miller
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