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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10SB
GENERAL FORM FOR REGISTRATION OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
WORLDBID CORPORATION
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(Exact name of Company as specified in its charter)
NEVADA 88-0427619
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
(Address of principal executive offices) (Zip Code)
Registrant's telephone number,
including area code 604-932-6874
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Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange
to be so registered on which each class is to
be registered
None None
Securities to be registered pursuant to Section 12(g) of the Act:
100,000,000 Shares of Common Stock
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(Title of class)
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TABLE OF CONTENTS
Page
COVER PAGE 1
TABLE OF CONTENTS 2
PART I 3
DESCRIPTION OF BUSINESS 3
DESCRIPTION OF PROPERTY 25
DIRECTORS, EXECUTIVE OFFICERS AND SIGNIFICANT EMPLOYEES 25
REMUNERATION OF DIRECTORS AND OFFICERS 27
SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN
SECURITYHOLDERS 28
INTEREST OF MANAGEMENT AND OTHERS IN CERTAIN
TRANSACTIONS 29
SECURITIES BEING REGISTERED 30
PART II 31
MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S
COMMON EQUITY AND OTHER STOCKHOLDER MATTERS 31
LEGAL PROCEEDINGS 31
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS 31
RECENT SALES OF UNREGISTERED SECURITIES 31
INDEMNIFICATION OF DIRECTORS AND OFFICERS 32
PART F/S 34
FINANCIAL STATEMENTS 34
PART III 34
INDEX TO EXHIBITS 34
SIGNATURES 35
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PART I
The issuer has elected to follow Form 10-SB, Disclosure
Alternative 2.
Item 6. Description of Business
The Company is an electronic commerce company which owns and
operates an on-line business-to-business world trade web site.
The Company's web site is located on the Internet at
"www.worldbid.com" (the "Web Site"). The Web Site facilitates
business transactions on the Internet by providing an organized
and systematic tool for businesses to post notices of goods for
sale and requests for tender of goods. The Company uses e-mail
notifications in order to enable businesses to connect. The
Company has focused on the international trade market in order to
provide an economical means of enabling businesses from around the
world to meet and transact business.
The Web Site solicits businesses who have products for sale or who
are interested in procuring products for purchase. The Web Site
enables businesses to submit postings on the web site in a
systematic and organized manner. Businesses are connected using a
system of automatic e-mail notifications whereby postings are
transmitted to other businesses within specific categories of
interest. Businesses are then able to contact other businesses
directly and negotiate transactions between themselves without the
involvement of the Company.
CORPORATE ORGANIZATION
Incorporation
WorldBid Company (the "Company") was incorporated pursuant to the
laws of the State of Nevada on August 10, 1998.
Subsidiaries
The Company does not have any subsidiaries.
ACQUISITION OF THE WORLDBID INTERNET BUSINESS
The Company acquired the "WorldBid.Com" Internet business (the
"WorldBid Business") pursuant to an agreement dated February 2,
1999 between the Company, Databoat International Limited
("Databoat") and Scott Wurtele ("Wurtele"), the principal
shareholder of Databoat (the "Acquisition Agreement").
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The Company issued to Databoat a total of 3,000,000 restricted
shares of common stock of the Company (the "Databoat Shares") on
closing of the Acquisition. The Company and
Databoat have agreed that the Databoat Shares will be held in escrow
for a period of four years on the terms and conditions of an escrow
agreement entered into between the Company, Databoat and Cane &
Company, the attorneys for the Company (the "Escrow Agreement").
The Databoat Shares will be released to Databoat over a period of
four years in accordance with the escrow release schedule in the
Escrow Agreement.
The Company has also entered into a consulting agreement with
Wurtele and On Line Design Ltd. for the services of Wurtele and On
Line Design Ltd. (the "Management Consulting Agreement") on
closing of the Acquisition Agreement. On-Line Design is a private
British Columbia company, all of the shares of which are owned by
Wurtele. The terms and conditions of the Management Consulting
Agreement are discussed below under the heading "Item 6. Business
- - Employees."
A copy of each of the Acquisition Agreement, the Escrow Agreement
and the Management Consulting Agreement are attached to this
registration statement and is made a part of this registration
statement by reference. The information provided in this
registration statement with respect to each of the Acquisition
Agreement, the Escrow Agreement and the Management Consulting
Agreement is qualified in its entirety by reference to the
complete texts of each agreement.
The Company issued the Databoat Shares to Databoat pursuant to the
Acquisition Agreement in consideration of the transfer by Databoat
to the Company of the assets, technology, property and rights
comprising the WorldBid Business as it existed on closing on
February 16, 1999. The Acquisition Agreement provides for
circumstances in which the WorldBid Business may be transferred
back to Databoat at the option of Databoat. These circumstances
are: (i) the failure of the Company to advance to the WorldBid
Business a total of $300,000 by February 16, 2000 in accordance
with the schedule of advances incorporated into the Acquisition
Agreement; (ii) the termination of the Management Consulting
Agreement as a result of the failure of the Company to perform its
obligations pursuant to the Management Consulting Agreement; and
(iii) the failure of the shares of the Company to be listed or
quoted for trading on any public trading market within 18 months
of the closing of the Acquisition Agreement. In the event that the
WorldBid Business is transferred back to Databoat, the Databoat
Shares would be returned to the Company and canceled.
The Company has advanced a total of $220,000 to the WorldBid
Business as of June 15, 1999 and anticipates having advanced in
excess of $300,000 to the WorldBid Business by August, 1999.
The Company may also cause Databoat to return the Databoat Shares
to the Company for cancellation in the event that the Company
determines not to proceed with the development of the WorldBid
Business. The WorldBid Business would be transferred back to
Databoat
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in the event that the Company exercises this option. The
Company intends to proceed with the development of the WorldBid
Business at this time.
DEVELOPMENT OF THE WORLDBID BUSINESS
The development of the Web Site was started by Databoat in
September, 1998. While the Web Site was operational at the time
of its acquisition by the Company, the Company determined that the
functionality and presentation of the Web Site required upgrading
prior to the Company being able to market and solicit
advertisements for the Web Site.
The Company has proceeded with the development of the WorldBid
Business since completion of its acquisition from Databoat. The
Company's development of the Web Site has included a complete
restructuring of the Web Site which was comprised of the following
elements:
A. Re-design of the graphics and presentation of the Web Site;
B. Expansion of the functionality of the Web Site to include
additional features, including posting of goods offered for
sale and expanded e-mail notifications capabilities;
C. Expansion and upgrading of the Company's computer hardware
and programming in order to expand the functionality and
capacity of the Web Site;
D. Addition of search capabilities in order that users can
search for products by description or product codes;
E. Expansion of the number of categories within the Web Site
from 20 to 420;
The Web Site is presently fully operational. The Company has
reached a database of over 5,000 business parties who have
completed postings on the Web Site. The Company completed over
1,000,000 e-mail trade notifications during June, 1999.
With the restructuring of the Web Site complete, the Company is
now commencing the marketing of the advertising potential of the
Web Site in order that the Company can start to earn revenues.
FUNCTION OF THE WORLDBID WEB SITE
The Web Site is used by businesses as follows:
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Buyers
Each business interested in purchasing a product is given the
opportunity to place a "Request for Tender/ Procurement/ or Offer
to Buy" on the Web Site. Each business user selects the
applicable category for their area of interest and enters in a
description of the products or services sought, together with the
contact and e-mail information. Each request for tender
is automatically delivered by e-mail to each business that has
entered the Web Site and entered its contact information with the
request that they receive information regarding specific products
or services. Each business can also enter its e-mail address in
order to receive e-mail notifications from potential sellers in
their category of interest.
Sellers
Each business which is interested in completing a sale is given
the opportunity to post offers to sell on the Web Site. Each
business user selects a category of their offer for sale and then
enters in a description of the products or services to be sold,
together with the business users' contact and e-mail information.
Each offer to sell is automatically delivered by e-mail to each
business that has entered the Web Site and entered its contact
information with the request that they receive information
regarding specific products or services which are offered to sale.
Each business which is interested in completing a sale can also
enter its e-mail address in order to receive e-mail notifications
from potential purchasers in their category of interest.
Requests for E-Mail Notifications
The Web Site can also be used by businesses that do not wish to
enter requests for tender or offers for sale. Business users may
select a category of interest and view posted requests for tenders
and offers to sell. Business users may enter their e-mail contact
information in order to receive notifications of any request for
tender or offer to sell within a category of interest.
Categories
The format of the Web Site allows for a broad variety of
categories and sub-categories, thereby appealing to a wide variety
of potential business users. Businesses can request additional
categories and sub-categories at the Web Site by e-mailing the
Company via the Web Site. The Company believes that this flexible
format will enable the Company to attract a broad range of
businesses who presently do not have any conventional means of
requesting tenders or obtaining requests for their products or
services. The global nature of the Internet and its ability to be
accessed world-wide enables the Web Site to be used by businesses
to access markets outside their geographic region. The Company's
experience is that approximately 75% of the users of the Web Site
who have posted requests for tender or offers for sale on the Web
Site are from countries outside of the United States.
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Development Focus
The Company has developed the format of the Web Site in order to
encourage use by businesses from around the world in the
international trade community. The Company believes that the
international focus of the Web Site offers a competitive advantage
over competing trade sites which may limit their focus to specific
geographic regions. The Company has also focused on enabling the
Web Site to facilitate trade in goods which are often the subject
of international trade, such as industrial goods and commodities.
No Auction or Transaction Completion Process
The Web Site does not conduct any auction or similar transaction
completing process. The Web Site is a means for interested
parties to make contacts and pursue negotiations between
themselves. The Company is not involved in the negotiation of the
price or any terms of any contract between potential purchasers
and suppliers.
REVENUES
The Company's business plan is to use the Web Site to earn
revenues from the following sources:
A. advertising placed on e-mails which are transmitted via the
Web Site to businesses;
B. usage fees charged to businesses for posting requests for
tender and offers for sale on the Web Site;
C. referral fees earned by the referral of users of the Web Site
to web sites operated by other companies.
Advertising Revenues
The Company plans to sell advertising placed on e-mails which are
transmitted via the Web Site to businesses. The Company has not
entered into any advertising sales contracts or achieved any
revenues from advertising to date.
Advertising on e-mails is a new and emerging means of advertising
products and services using the Internet. The Company plans to
use its business format and the e-mail notifications generated by
use of the Web Site to sell advertising on e-mail notifications.
The Company will target advertisers involved in the business of
trade and international trade and advertising agencies with
clients involved in the business of trade and international trade.
The targeted marketing group will include companies such as over-
night courier services, insurance agents
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and customs brokers as
potential advertisers on the Web Site. The Company anticipates
advertising revenue would be based on a fee per number of e-mails
delivered.
Advertising on e-mails is a new form of advertising that has yet
to achieve broad based commercial acceptance. The Company
anticipates having to incur significant market efforts in order to
persuade advertisers of the benefits of advertising on e-mails.
The Company is pursuing negotiations with advertising agencies as
a means of concentrating its market
efforts. Advertising agencies have multiple clients to whom they
may present the Company's advertising format.
The Company has determined that independent verification of use of
the Web Site and e-mail notifications is an essential element of
the Company being able to market the advertising potential of the
Web Site. Accordingly, the Company has retained an independent
auditor to verify the e-mail notifications sent by the Company via
the Web Site. Independent audit reports will be submitted to
advertising agencies and potential advertisers as support for the
Company's claimed e-mail notification rates.
Fee for Posting Requests for Tenders and Offers for Sale
The Company is considering charging fees for permitting businesses
to make postings on the Web Site. The Company has not charged any
fees to businesses using the Web Site to date in order to
encourage usage of the Web Site and to expand the base of
businesses using the Web Site and receiving e-mail notifications.
The Company is in the process of evaluating this revenue
opportunity as usage of the Web Site increases. The Company plans
to charge fees to businesses once the volume of usage on the Web
Site has increased to a level where businesses are prepared to pay
a fee to post requests for tenders and to receive e-mail
information.
Referral Arrangements
The Company also proposes to pursue arrangements with other
companies whereby the Company may earn a commission or fee based
on businesses referred to web sites operated by other companies.
The Company presently does not have any revenue earning referral
arrangements in place.
Future Revenue Streams
The Company will continually evaluate alternate revenue streams
for the Web Site and the WorldBid Business. The Internet
electronic commerce market is rapidly evolving and presenting
businesses with new revenue opportunities. This rapid evolution
can also result in existing revenue streams being reduced or
eliminated due to technological change and competition.
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BUSINESS DEVELOPMENT STRATEGY AND PLAN OF OPERATIONS
The business objective of the Company is to establish the Web Site
as the premier business-to-business Internet web site for world
trade. The Company believes that the achievement of this
objective will result in increased usage of the Web Site by
businesses and increased volumes of e-mail notifications being
transmitted by the Company. The achievement of
increased use of the Web Site and transmission of e-mail
notifications are essential components of the Company being able
to achieve revenues.
The Company's plan of operations for the next twelve months
involves pursuing its business objectives using the following key
business development and marketing strategies:
Develop Advertising Sales for the Web Site
The Company plans to develop relationships and arrangements with
advertising agencies and advertisers who are prepared to advertise
on e-mail notifications transmitted via the Web Site. The Company
will attempt to enter into its first advertising contracts for the
Web Site. The Company plans to use the independent audit report
of usage of the Web Site and e-mail notification transmissions as
a basis for commencing sales to advertisers directly and through
advertising agencies.
Evaluate Implementation of Usage Fees for the Web Site
The Company will continue the evaluation of charging usage fees to
businesses using the Web Site. The Company anticipates
commencing to charge usage fees to businesses once the Company has
determined that usage of the Web Site has increased to a level
where businesses are prepared to pay to place postings on the Web
Site without a significant decrease in overall usage of the Web
Site
Initiate Advertising and Promotional Campaigns for the Web Site
The Company will attempt to increase the visibility and brand
recognition of the WorldBid Business through a variety of
marketing and promotional techniques.
The Company intends to undertake an advertising program now that
the restructuring of the Web Site has been completed. The
advertising campaign may involve advertising on complementary
Internet web sites and in complementary print media. The Company
has yet to finalize any advertising campaign. There is no
assurance that any advertising campaign undertaken by the Company
will be successful in increasing usage of the Web Site.
The Company will pursue co-marketing arrangements with other web-
sites on the Internet through cross-linking. The Company may post
links to other web-sites in return for the other
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web-sites posting
the Company's links. The Company proposes to pursue cross-linking
only where there is the potential of a mutually beneficial
relationship with other web-sites.
The Company will also use consistent graphics and presentation to
reinforce brand recognition with users.
The Company believes that broad based recognition of the Web Site
is essential to the success of the WorldBid Business. The
business of the Company and its financial performance will be
harmed if the Company is not successful in building strong
recognition of the Web Site.
Offer a Unique Internet World Trade Site
The Company has developed the format of the Web Site to be a
unique Internet web site for business-to-business electronic
commerce by using its system of e-mail notifications. The system
of e-mail notifications differentiates the Web Site from other web
sites which simply offer the ability to post offers for sale or
requests for tender. The Company will pursue additional features
for the Web Site in order to increase the level of service to
business to users and to further differentiate the Web Site from
competing web sites.
Expand the Features of the Web Site
The Company will pursue additional features for the Web Site in
order to enhance the functionality of the Web Site. Features to
be added to the Web Site to expand its functionality may include:
A. Adding translation software to e-mail notifications in order
that businesses can communicate in their first language;
B. Addition of additional categories of products and services;
C. Hypertext links to other complementary trade sites which
would provide businesses with information which may be
helpful in completing business transactions;
D. Filtering options for users conducting searches on the Web
Site;
E. Multi-lingual pages within the Web Site.
The Company recognizes that competition will demand that the
design, operation, functionality, features and capacity of the
Web Site be continually upgraded. The Company plans to evaluate
upgrades to the design, operation, functionality and capacity of
the Web Site on an ongoing basis.
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Promote Repeat Visits by Users
The Company has designed its Web Site with an attractive
presentation and with functional and easy to use features with the
objective of encouraging repeat usage of the Web Site. The
Company has recognized that potential users may not have strong
computer skills or may not have English as their primary language.
According, the Company will continue its
focus on making the Web Site easy to use and intuitive. The Company
believes that repeat usage will lead to a greater number of
businesses entering postings on the Web Site and a greater number
of e-mail notifications being transmitted through the Web Site.
Monitor Usage of the Web Site and Develop User Profiles
The Company believes that increased information regarding the
businesses using the Web Site will assist the Company in marketing
the Web Site and developing revenues and business transactions
which are completed via the Web Site. At present, the Company
gathers minimal information regarding users of the Web Site. The
Company is proposing to expand the capability of the Web Site to
obtain personal and business profile information regarding
businesses using the Web Site. This information will assist the
Company in marketing the Web Site to advertisers who may be
prepared to pay to advertise on the Web Site and on e-mail
notifications. Information regarding the location, nature of
business, wealth and other marketing criteria of users of the Web
Sites will assist in developing user profiles which will assist in
marketing the advertising potential of the Web Site.
The Company Expects Operating Losses
The Company incurred a loss of $40,086 for its first fiscal year
ending April 30, 1999. The Company expects that the stated plan of
operations will result in operating losses until such time as
significant revenues are achieved. This expectation is based in
part on the following:
A. The Company will incur substantial marketing expense in order
to advertise and promote the Web Site and increase usage of
the Web Site
B. The Company expects that increase usage of the Web Site will
lead to increased operating expenses and require additional
capital expenditures on new computer equipment, software and
technology.
C. The Company expects operating expenses to continue to
increase as the Company expends the functionality and
technical capabilities of the Web Site.
D. The Company expects operating expenses to increase as the
Company solicits potential advertisers and attempts to enter
into agreements for advertising on the Web Site.
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E. The Company expects operating expenses to increase as the
Company undertakes to implement programs to monitor usage of
the Web Site and develop customer profiles of Web Site users.
To the extent that increases in operating expenses are not matched
by increased revenue, the Company's business, operating results
and financial condition will be harmed.
The Company's plan of operations includes forward looking
statements. Actual results of the Company and the Company's
actual plan of operations may differ materially from the stated
plan of operations. Factors which may cause the actual results of
the Company or its actual plan of operations to vary include
decisions of the board of directors not to pursue the stated plan
of operations based on re-assessment by the board of directors of
the plan which is in the best interests of the Company, changes in
the Internet business or general economic conditions. The Company
relies upon the protection afforded forward-looking statements
provided by the United States Securities Act of 1933 and the
Securities Exchange Act of 1934.
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EMPLOYEES
As of June 30, 1999, the Company had no employees, other than its
Officers. The Company has eleven full-time equivalent contract
personnel.
The Company's two officers are Mr. Logan Anderson, President, and
Mr. Howard Thomson, Secretary and Treasurer. The Company is not
party to any written agreement with either Mr. Logan Anderson or
Mr. Howard Thomson. Each of Mr. Anderson and Mr. Thomson provides
their services on a part-time basis as required for the business
of the Company. The Company presently does not pay to Mr. Anderson
any salary or consulting fee. The Company pays to Mr. Thomson a
consulting fee of $500 per month in consideration of the services
of Mr. Thomson. Payment of the consulting fee to Mr. Thomson
commenced on April 1, 1999. The Company anticipates that the
compensation payable to Mr. Anderson and Mr. Thomson will be
increased upon establishment of the WorldBid Business and approval
of remuneration by the board of directors of the Company.
The names and duties of the Company's full-time equivalent
contract personnel are as follows:
Name of
Consultant Duties
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Scott Wurtele Management of the Operations of the Web Site
Aaron McNeal Head Programmer; E-mail Notifications, Security
Jonathan Knopp Programmer; Advertisement Management Software
Paul Wagorn Programmer; Automation of Postings
Nick Sysek Sales
Gordon Merkel Marketing and Customer Relations
Ken Domries Electronic Marketing
Wendy Wurtele Administration; Accounting; Payroll; Web Site
Graphic Design
Daniel Wurtele Web Site Design and Operation
Carolyn Buegger Customer Service
Penny Domries Postings Review
The Company has entered into written consulting agreements with
each of the above contract personnel. With the exception of the
consulting agreement for the services of Scott Wurtele, each
consulting contract is terminable by the Company at the Company's
option without penalty on not more than one month's notice.
The services of Scott Wurtele are provided to the Company pursuant
to the Management Consulting Contract. The Management Consulting
Contract was executed on completion of the Acquisition Agreement.
The Company pays to On-Line Design a management consulting fee of
$5,000 US per month in consideration for On-Line Design providing
the consulting services of Wurtele. The consulting services
include management and continued
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development of the WorldBid
Business. The term of the Management Consulting Contract is for a
period of one year expiring on February 16, 2000. The Management
Consulting Contract may only be renewed by agreement between the
Company, On-Line Design and Wurtele. On-Line Design is a private
British Columbia company, all of the shares of which are owned by
Wurtele.
The Company's future performance depends upon the continued
contributions of members of senior management and other key
personnel. The Company does not have long-term employment
agreements with any of its key personnel and does not maintain key
person life insurance. Competition for attracting and retaining
personnel in the industry is intense, and the Company needs to
succeed in the future. If one or more of its key personnel leaves
and/or joins or forms a competitor, this could have a harmful
effect on the Company's business.
TECHNOLOGY
The Company uses a combination of proprietary technology and
commercially available licensed technology to operate the Web
Site.
Proprietary Technology
The Company is the owner of proprietary software developed by the
Company which is incorporated into the Web-Site. This proprietary
software includes search engine software, advertising management
software and certain web site management tools. The Company
continues the development of proprietary software to enhance and
expand the capabilities of the Web-Site in circumstances where
commercial third party software is not available. The Company
believes that this continued development is essential to the
commercial success of the WorldBid Business.
Operations
The Company owns the servers that host the Web-Site. The
Company's servers are located in Vancouver, British Columbia on
leased premises. The Company's system administrators manage,
monitor and operate the Web Site via remote access.
The operation of the Company's servers which host the Web Site
depends on operating system software, database software, and
server software that has been developed, produced by and licensed
from third parties. The Company licenses commercially available
technology whenever possible instead of purchasing custom-made or
internally developed solutions. The software licensed by the
Company is commercially available software and is not software
developed specifically for the Company.
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Internet Gateway
The Company does not own a gateway onto the Internet, but instead
relies on an Internet service provider to connect the Web Site to
the Internet. The Company uses Internet service providers to
provide connectivity to the Internet, Internet traffic and data
routing services and e-mail services. The Internet service
provider provides the Company with a high speed Internet access
line to the World Wide Web. The Company believes that these
telecommunication and Internet service facilities will need to
upgraded in the future as usage of the Web Site increases.
INTELLECTUAL PROPERTY AND OTHER PROPRIETARY RIGHTS
The Company's performance and ability to compete are dependent to
a significant degree on its proprietary technology. The Company
relies on a combination of trademark, copyright and trade secret
laws, as well as confidentiality agreements and non-compete
agreements executed by employees and consultants as measures to
establish and protect its proprietary rights.
The Company has applied for registration of the "WorldBid" trademark
in the United States. The Company submitted an application to the
United States Patent and Trademark Office on June 4, 1999 for a
service mark "WORLDBID" for use in connection with the services
provided by the Company. There can be no assurance that the Company
will be able obtain a trademark for "WorldBid" or to secure
significant protection for its service marks or trademarks.
If granted, the issuance of a trademark will not be definitive of the
Company's right to use the trademark in conjunction with the Company's
services. The Company's rights would be subject to (i) the Act of July
5, 1946 (U.S.C. 1051 et. Seq., as amended); (ii) state and common law
rights which generally confer rights based, among other things, on
having been the first person to use the trademark, the distinctiveness
of the trademark and the potential confusion with other trademarks,
whether registered or not.
The Company is the owner of the "www.worldbid.com" domain name.
It is possible that competitors of the Company or others will
adopt Internet domain names or product or service names similar to
"WorldBid", thereby impeding the Company's ability to establish
recognition and usage of the Web Site and creating confusion
amongst users and potential users of the Web Site.
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RESEARCH AND DEVELOPMENT EXPENDITURES
Since the acquisition of the WorldBid Business in February, 1999,
the following amounts have spent by the Company on research and
development activities:
February 16, 1999 to
April 30, 1999
Research and Development
Operating Expenditures: $29,137
Development Expenditures
Capitalized as Assets: $30,301
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Total Research and
Development Expenditure $59,438
Research and development activities have consisted on the
development of the Web Site and programming and software
development associated with the Web Site.
INDUSTRY BACKGROUND
Growth of the Internet and the World Wide Web (the "Web")
The Internet and the Web are experiencing dramatic growth in terms
of the number of Web users. The growth in the number of Web users
and the amount of time users spend on the Web is being driven by
the increasing importance of the Internet as a communications
medium and an information resource and a sales and distribution
channel.
Growth of Online Electronic Commerce
The Internet is dramatically affecting the methods by which
consumers and businesses are buying and selling goods and
services. Electronic commerce offers the opportunity for
businesses to establish new competitive standards by expanding
distribution channels, integrating internal and external processes
and offering a cost-effective method of providing products and
services. The Internet provides online businesses with the
ability to reach a global audience and to operate with minimal
infrastructure, reduced overhead and greater economies of scale,
while providing consumers and businesses with a broad selection,
increased pricing power and unparalleled convenience. As a result,
a growing number of parties are transacting business on the Web.
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The World Trade Market on the Internet
The Company has identified a need in the international business
community for an Internet web site which can connect businesses
involved in national and international trade at an economical
cost. The traditional methods of information delivery and
communications between businesses involved in international trade,
including trade magazines, telephone and trade conferences,
contain inherent inefficiencies, including:
A. Trade publications and print media are costly and offer
limited circulation;
B. Expansion of business beyond traditional boundaries is
expensive due to the high cost of marketing, travel and
promotional expenses;
C. Language barriers limit the ability of businesses to
communicate.
The Internet provides a medium for business throughout the world
to communicate and start the process of entering into business
transactions. The Company proceeded with the acquisition of the
WorldBid Business with the objective of capitalizing on the demand
for a world trade Internet web site.
COMPETITION
While the Company's objective is to develop a unique world trade
Internet web site, the Company currently or potentially competes
with a variety of other companies depending involved in
facilitating business transactions via the Internet. These
competitors include: (i) direct competing Internet web sites,
including VerticalNet.Com, Inc., Compassnet.com and the United
Nations Trade Web Site businesses; (ii) traditional business-to-
business competitors that are attempting to expand their existing
businesses to electronic commerce; and (iii) traditional business-
to-business advertising and commerce competitors, including trade
magazines and trade associations
The Company's business plan anticipates that revenue will be
earned from advertising revenue. There is no assurance that
potential advertising revenues will not decrease with the growth
in electronic commerce and competition from competitors. The
presence of existing or future competition may impair the ability
of the Company to charge user fees to businesses who place
postings on the Web Site and receive e-mail notifications.
The Company anticipates that competition in the electronic
commerce market will increase in the future as electronic commerce
is characterized by low barriers to entry. Moreover, current and
potential competitors may expand the capabilities of their web
sites to compete directly with the Web Site. Accordingly, it is
possible that new competitors or alliances among
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competitors may emerge and attract users and potential users from
the Web Site. In addition, potential users may elect to sell their
products directly without use of the Web Site.
Increased competition may result in the reduction in potential
advertising and usage fees, the reduction of user of the Web Site
and the inability of the Company to generate business acceptance
of the Web Site. Each of these factors would likely result in
increased operating costs and the inability to generate revenues,
any one of which could materially adversely affect the Company's
business, results of operations and financial condition. Many of
the Company's current and potential competitors have significantly
greater financial, marketing, customer support, technical and
other resources than the Company. As a result, such competitors
may be able to attract potential users away from the Web-Site, and
they may be able to respond more quickly to changes in customer
preferences or to devote greater resources to the development,
promotion and sale of their web-sites than can the Company.
GOVERNMENT REGULATION
The Company's experience is that the Web Site is used by users
from multiple state and international jurisdictions. While the
Company does not directly participate in any transaction completed
between businesses using the Web Site, the Company transmits e-
mails to users across international and state boundaries. There
is a risk that these e-mail transmittals may be the subject of
government regulation in the future or that governments will
interpret their laws as having jurisdiction over the Company and
its business. Applicability of these laws may have the result
that the Company being prohibited from transmitting e-mails to
users in certain states or countries or that the Company may have
to incur increased expense in order to transmit e-mails to users
incertain states or countries.
Due to the increasing popularity and use of the Internet, it is
possible that a number of laws and regulations may be adopted with
respect to the Internet generally, covering issues such as user
privacy, pricing, and characteristics and quality of products and
services. Similarly, the growth and development of the market for
Internet commerce may prompt calls for more stringent consumer
protection laws that may impose additional burdens on those
companies conducting business over the Internet. The adoption of
any additional laws or regulations may decrease the growth of
commerce over the Internet, increase the Company's cost of doing
business or otherwise have a harmful effect on the WorldBid
Business.
The Company may have to qualify to do business in other
jurisdictions. As the Company's Web Site is available over the
Internet in multiple states and foreign countries, and as the
users of the Web Site are resident in such states and foreign
countries, such jurisdictions may claim that the Company is
required to qualify to do business as a foreign Company in each
such state and foreign country. Failure to qualify as a foreign
Company in a jurisdiction where required to do so could subject
the Company to taxes and penalties.
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The Company is not aware of any environmental laws which are
applicable to the operation of the WorldBid Business.
YEAR 2000 RISK
Background
Computer systems, software packages, and microprocessor dependent
equipment may cease to function or generate erroneous data when
the Year 2000 arrives. The problem affects those systems or
products that are programmed to accept a two-digit code in date
code fields. To correctly identify the Year 2000, a four-digit
date code field will be required to be what is commonly termed
"Year 2000 compliant."
Readiness
The Company has completed an assessment of all internal systems
and operations to determine Year 2000 compliance. The Company's
assessment has included an assessment of computer hardware systems
and web site operations systems. The Company has determined that
its internal computer hardware systems and web site operations
systems and operations are Year 2000 compliant. As such, the
Company does not anticipate any material adverse operational
issues to arise from the Year 2000 problem affecting internal
systems and operations.
The Company has completed upgrading of all third party licensed
software to ensure Year 2000 compliance. The Company has relied
upon the written representations of each of the third parties
from whom the Company licenses third party software that the
upgraded software is Year 2000 compliant. While the Company has
relied upon representations by third parties, the Company cannot
give any assurance that all third party licensed software will be
Year 2000 compliant.
The Company has investigated the Year 2000 compliance of all
computer hardware purchased by the Company since commencement of
operations. The Company has relied upon representations by
hardware manufactures that all computer hardware purchased is Year
2000 compliant. While the Company has relied upon representations
by manufacturers, the Company cannot give any assurance that all
computer hardware will be Year 2000 compliant.
The Company has made inquires of its Internet service provider,
NetNation Communications, Inc. ("NetNations"), as to the Year 2000
compliance of the Internet service provider's systems and
operations. NetNations has given oral representations to the
Company that the its systems and operations are Year 2000
compliant. The Company has requested written confirmation of
NetNations Year 2000 compliance representations as part of its
Year 2000
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compliance plan. However, there is no assurance that
the Company will not be affected by Year 2000 problems arising
from problems with the Internet service provider's systems and
operations or experienced by the Internet service provider as a
result of third party problems.
Risks
The Company may realize exposure and risk if the systems for which
it is dependent upon to conduct day-to-day operations are not year
2000 compliant. The Company's worst case scenario would be the
inability of the Web Site to function due to the inability of the
computer hardware systems and web site operations systems to
function properly and disruptions to telecommunications services
experienced by Internet service providers and their users
throughout the world. Under this worst case scenario, the Company
would not be able to continue operations and the Web Site would
be inoperable until such time as the Company had replaced or
upgraded computer hardware or software components. If the Year
2000 problem affects the Company's Internet service provider, the
Web Site would remain in operable until the Internet service
provider re-commenced operations or until a replacement Internet
service provider had been found. In a worst case scenario, the
Year 2000 problem will result in increased expense to the Company
and decreased revenues being earned from the Web Site or the delay
the realization of revenues from the Web Site.
Estimated Year 2000 Costs
The Company estimates that its total internal cost for ensuring
Year 2000 compliance for all internal systems to date to be less
than $10,000. The Company anticipates incurring internal costs of
less than $10,000 in completing its Year 2000 compliance plan.
The Company has not incurred any external cost in ensuring Year
2000 compliance in view of the fact that the Company has only
recently commenced operations and has purchased computer hardware
and software on the basis of representations by manufacturers as
to Year 2000 compliance.
Contingency Planning
The Company is developing a contingency plan to address situations
that may result if the Company is affected by Year 2000 problems.
Contingency plans include back-up of all computer databases. The
Company is unable to make contingency plans if any significant
number of the computers constituting the Internet fail to process
dates properly for the year 2000 and there is a system-wide
slowdown or breakdown. The Company's business is dependent on the
continued successful operation of the Internet. Any interruption
or significant degradation of Internet operations due to Year 2000
problems could harm the Company's business.
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RISK FACTORS
The Company faces risks in executing its business plan and
achieving revenues. The following risks are material risks which
the Company faces. If any of the following risks occur, the
business of the Company and its operating results and financial
condition could be seriously harmed:
The Company's Short Operating History makes its business difficult
to evaluate
The Company acquired the Worldbid Business in February, 1999 and
the Web Site began operations on the Internet in October, 1998.
Accordingly, the Company has a limited operating history upon
which to base an evaluation of our business and prospects.
Accordingly, the Company's business and prospects must be
considered in light of the risks, expenses and difficulties
frequently encountered by companies in their early stage of
development, particularly companies in new and rapidly evolving
markets such as electronic commerce. To address these risks, the
Company must successfully implement its business plan and
marketing strategies. The Company may not successfully implement
all or any of its business strategies or successfully address the
risks and uncertainties that it encounters.
The Company has no revenues
The Company's business and marketing strategy contemplates that
the Company will earn a substantial portion of its revenues from
advertising. There is no assurance that the Company will be able
to generate revenues from advertising or that the revenues
generated will exceed the operating costs of the WorldBid
Business. Advertisers may not accept advertising on e-mails as
an acceptable form of advertising. Rates for advertising on e-
mails may decrease as the growth of the Internet and electronic
commerce brings increased competition. Businesses may not be
prepared to pay a fee in order to post requests for tenders or
offers for sales on the Web Site or to receive e-mails of requests
for tenders.
Operating results are difficult to predict
The Company's future financial results are uncertain due to a
number of factors, many of which are outside the Company's
control. These factors include:
A. ability to increase usage of the Web Site;
B. ability to generate revenue through the Web Site;
C. the timing, cost and availability of advertising on web sites
comparable to the Company's and over other media;
D. the amount and timing of costs relating to expansion of the
Company's operations;
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E. the announcement or introduction of competing web sites and
products of competitors; and
F. general economic conditions and economic conditions specific
to the Internet and electronic commerce.
Additional Financing
The Company will require additional financing in order to complete
its business plan of operations. The Company has no agreements
for additional financing and there can be no assurance that
additional funding will be available to the Company on acceptable
terms in order to enable the Company to complete its plan of
operations. The Company will not be able to continue operations
if additional financing is not obtained.
Recognition of the Web Site is essential to growth of the WorldBid
Business
The Company believes that the successful marketing, development
and promotion of the Web Site is critical to its success in
attracting businesses and advertisers. Furthermore, the Company
believes that the importance of customer awareness will increase
as low barriers to entry encourage the proliferation of web sites.
If the Company is unsuccessful in continuing to build strong
recognition of the Web Site, then the Company may not be able to
achieve revenues. The marketing and promotion efforts
contemplated by the Company may not be successful in increasing
business awareness of the Web Site or in enabling the Company to
achieve revenues.
The Company depends on third parties for the operation of its
business
The Company depends on several third parties in conducting its
operations, including the following:
* the Company does not own a gateway onto the Internet, but
instead relies on an Internet service provider to connect the
Web Site to the Internet; and
* the Web Site depends on operating system, database, and
server software that has been developed, produced by and
licensed from third parties.
The Company has limited control over these third parties and has
no long-term relationships with any of them. If the Company is
unable to develop and maintain satisfactory relationships with
such third parties on acceptable commercial terms, or if the
quality of products and services by such third parties falls below
a satisfactory standard, its business could be harmed. Also, the
Company's loss of or inability to maintain or obtain upgrades to
certain
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technology licenses could result in delays in developing
its systems until equivalent technology could be identified,
licensed or developed, and integrated.
The Company depends on its key employees
Competition for qualified personnel in the Company's industry is
intense, particularly for software development and other technical
staff. The Company believes that its future success will depend in
part on its continued ability to attract, hire and retain
qualified personnel. None
of the Company's employees is represented by a labor union, and
the Company considers its employee relations to be good.
Risks of systems failure
Substantially all of the Company's communications hardware and
computer hardware is located at a leased facility in Vancouver,
British Columbia, Canada. The Company's systems are vulnerable to
damage from earthquake, fire, floods, power loss,
telecommunications failures, break-ins and similar events. The
Company does not presently have fully redundant systems and has
not yet completed implementing a formal disaster recovery plan.
Despite the Company's implementation of network security measures,
its servers are also vulnerable to computer viruses, physical or
electronic break-ins, attempts by third parties deliberately to
exceed the capacity of the Company's systems and similar
disruptive problems. The Company's coverage limits on its property
and business interruption insurance may not be adequate to
compensate for all losses that may occur.
The Company may be unable to protect its intellectual property.
The Company's performance and ability to compete are dependent on
a significant degree on its ability to protect and enforce its
intellectual property rights, which include the following:
* proprietary technology;
* trade names; and
* domain names, each of which relates to the Company's brand.
The Company may not be able to protect its proprietary rights, and
its inability or failure to do so could result in loss of
competitive and commercial advantages that the Company holds. See
"Business - Intellectual Property." Additionally, the Company may
choose to litigate to protect its intellectual property rights,
which could result in a significant cost of resources and money.
The Company cannot assure success in any such litigation that it
might undertake.
The Company may in the future receive notices from third parties
claiming infringement by the Company's software, by the use of the
name "WorldBid" or other aspects of the Company's business. The
Company is not currently subject to any such claim that would have
a material effect on the Company's business or financial
condition. However, any future
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claim, with or without merit,
could result in significant litigation costs and diversion of
resources including the attention of management which could have a
material adverse effect on the Company's business, results of
operations and financial condition. In the future, the Company may
also need to file lawsuits to enforce the Company's intellectual
property rights, to protect the Company's trade secrets or to
determine the validity and scope of the proprietary rights of
others. Such litigation, whether successful or unsuccessful, could
result in substantial costs and diversion of resources, which
could have a material adverse effect on the Company's business,
results of operations and financial condition.
User acceptance of the WorldBid Business format is unknown
The success of the WorldBid business will depend on acceptance of
the business format of the Web Site. There is no assurance that
businesses will accept the format of the Web Site as an
enhancement to completing trade transactions. Businesses have a
variety of competing means for which to procure tenders for goods
and services, both via the Internet and through traditional
commercial means.
Trading of the Company's Common Stock
The Company may in the future be traded on the Nasdaq OTC Bulletin
Board. Companies traded on the OTC Bulletin Board have
traditionally experienced extreme price and volume fluctuations.
The Company's stock price may be adversely impacted by factors
which are unrelated or disproportionate to the operating
performance of the Company. The trading prices of many technology
companies' stocks are at or near historical highs and reflect
price earnings ratios substantially above historical levels.
These market fluctuations, as well as general economic, political
and market conditions such as recessions, interest rates or
international currency fluctuations may adversely affect the
market price of the Company's common stock.
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Item 7. Description of Property
The Company does not own or lease any real property.
The Company's physical property consists of its computer hardware
used in connection with the Web Site. The Company's computer
hardware consists of two Internet web server computers and eight
personal computers and related peripherals.
Item 8. Directors, Executive Officers and Significant Employees
The following information sets forth the names of the officers and
directors of the Company, their present positions with the
Company, and their biographical information.
Name Age Office(s) Held
- ---- --- --------------
Logan Anderson 44 Director and President
Howard Thomson 52 Director, Secretary and
Treasurer
Scott Wurtele 53 Consultant
Logan B. Anderson is a director of the Company and is the
President of the Company. Mr. Anderson is a graduate of Otago
University, New Zealand, with a Bachelor's Degree of Commerce in
Accounting and Economics (1977). He is an Associated Chartered
Accountant (New Zealand) and was employed by Coopers & Lybrand in
New Zealand (1977-1980) and Canada (1980-1982). From 1982 to
1992, Mr. Anderson was Comptroller of Cohart Management Group,
Inc., a management service company which was responsible for the
management of a number of private and public companies. Mr.
Anderson has been Principal and President of Amteck Financial
Services Company, a financial consulting service company since
1993. Mr. Anderson has been an officer and director of a number
of private and public companies in the past 12 years, including
PLC Systems, Inc. and 3D-Systems Inc.
Howard Thomson is a director of the Company and is the Secretary
and Treasurer of the Company. Mr. Thomson was employed from 1981
to 1998 in senior management positions with the Bank of Montreal,
including 5 years as Branch Manager, 4 years as Regional Marketing
Manager and 5 years as Senior Private Banker. Mr. Thomson retired
from the Bank of Montreal in 1998. Mr. Thomson resided in London,
England prior to joining the Bank of Montreal and was employed by
the National Westminster Bank in England for 13 years. Mr. Thomson
is also a director of Skinvisible, Inc., a company which
has developed and is marketing an anti-bacterial skin care product
and the whose common stock is traded on the OTC Bulletin Board.
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Scott Wurtele is a consultant to the Company. Mr. Wurtele is the
President and controlling shareholder of Databoat. Mr. Wurtele
founded Databoat in 1992 and has been employed as President of
Databoat since 1992. Databoat is a private company which has
developed an Internet boating book web site. Mr. Wurtele was
responsible for the development of Databoat as an electronic
commerce company. Specific goals accomplished by Databoat under
the direction of Mr. Wurtele include the production of a multi-
media CD for boating book publications and the establishment of
the Databoat web site. Prior to establishing Databoat in 1992,
Mr. Wurtele was involved in construction and project management
for approximately 20 years.
Terms of Office
Directors of the Company are appointed for one year terms to hold
office until the next annual general meeting of the holders of the
Company's Common Stock or until removed from office in accordance
with the Company's by-laws. Officers of the Company are appointed
by the Company's board of directors and hold office until removed
by the Company's board of directors.
The services of Mr. Wurtele are provided to the Company pursuant
to the Management Consulting Agreement. See Item 6. "Business -
Employees". The Management Consulting Agreement has a one year
term expiring February 16, 2000. The term of the Management
Consulting Agreement may be extended only by written agreement
between Wurtele, On-Line Design and the Company.
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Item 9. Remuneration of Directors and Officers
The following table sets forth certain information as to the
Company's three highest paid officers and directors for its first
fiscal year ended April 30, 1999. The Company's first fiscal year
reflects the period from date of the incorporation of the Company
on August 10, 1998 to June 30, 1999. No other compensation was
paid or will be paid to any such officer or directors other than
the cash compensation set forth below. See Item 6. "Business -
Employees".
Summary Compensation Table
Name of Individual or Capacities in which Aggregate
Identity of Group Remuneration was Received Remuneration
- --------------------- ------------------------- ------------
Logan Anderson Director and President NIL
Howard Thomson Director and Secretary $1,500
Treasurer
Officers and Directors Directors and Officers $1,500
of the Company as a
Group
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Item 10. Security Ownership of Management and Certain Security
Holders
The following table sets forth, as of June 30, 1999, the
beneficial ownership of the Company's Common Stock by each officer
and director of the Company, by each person known by the Company
to beneficially own more than 10% of the Company's Common Stock
outstanding and by the officers and directors of the Company as a
group. Except as otherwise indicated, all shares are owned
directly.
Name and address Number of Shares Percentage of
Title of class of beneficial owner of Common Stock Common Stock(1)
- -------------- ------------------- ---------------- ---------------
Common Stock Databoat
International
Limited(2) 3,000,000 50.0%
Common Stock Logan Anderson 450,000 7.5%
Director,
President
Common Stock Howard Thomson 50,000 0.8%
Director,
Secretary
and Treasurer
Common Stock All Officers
and Directors 500,000 8.3%
as a Group
(2 persons)
(1) Based on 6,000,000 shares of Common Stock of the Company
issued and outstanding on June 30, 1999
(2) Databoat International Limited is the owner of 3,000,000
shares of the Company. Databoat is a private company controlled
by Scott Wurtele. Scott Wurtele is the sole director of Databoat
and is the President of Databoat.
Share Purchase Warrants
The Company has not issued and does not have outstanding any
warrants to purchase shares of the Common Stock.
Options
The Company has not issued and does not have outstanding any
options to purchase shares of the Common Stock. The Company
anticipates approving an incentive stock option plan for its
directors, officers and permitted consultants.
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Convertible Securities
The Company has not issued and does not have outstanding any
securities convertible into shares of Common Stock or any rights
convertible or exchangeable into shares of Common Stock
Item 11. Interest of Management and Others in Certain
Transactions
Except as disclosed below, none of the following persons has any
direct or indirect material interest in any transaction to which
the Company is a party since the incorporation of the Company in
August, 1998 or in any proposed transaction to which the Company
is proposed to be a party:
(A) any director or officer of the Company;
(B) any proposed nominee for election as a director of the
Company;
(C) any person who beneficially owns, directly or
indirectly, shares carrying more than 10% of the voting
rights attached to the Company's Common Stock; or
(D) any relative or spouse of any of the foregoing persons,
or any relative of such spouse, who has the same house
as such person or who is a director or officer of any
parent or subsidiary of the Company.
The Company has acquired the WorldBid Business from Databoat
pursuant to the Acquisition Agreement. The Company has issued to
Databoat a total of 3,000,000 restricted shares of common stock of
the Company pursuant to the Acquisition Agreement. The Company
has also entered into the Management Consulting Agreement with
Wurtele and On Line Design Ltd., a private Company controlled by
Mr. Wurtele, whereby the services of Wurtele are provided to the
Company for a one year term. The Company pays to On-Line Design a
management consulting fee of $5,000 US per month in consideration
for On-Line Design providing the consulting services of Wurtele.
(See Item 6. Description of Business - Employees). Both Databoat,
the principal shareholder of the Company, and On-Line Design are
controlled by Scott Wurtele.
Databoat is a private company incorporated pursuant to the laws of
the Province of British Columbia, Canada and is controlled by Mr.
Scott Wurtele. Scott Wurtele is the sole director of Databoat
and is the President of Databoat. Scott Wurtele is the registered
owner of 70.5% of the voting common shares of Databoat. Wendy
Wurtele, the spouse of Scott Wurtele, is the owner of 13.1% of the
voting common shares of Databoat. Daniel Wurtele, the son of
Scott Wurtele and Wendy Wurtele, is the owner of 2.6% of the
voting common shares of Databoat.
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Item 12. Securities Being Registered
The securities being registered are the shares of the Company's
common stock, par value $0.001 per share. Under the Company's
Articles of Incorporation, the total number of shares of all
classes of stock that the Company shall have authority to issue is
100,000,000 shares of common stock, par value $0.001 per share
(the " Common Stock"). As of June 30, 1999, a total of 6,000,000
shares of Common Stock are issued and outstanding. All issued and
outstanding shares of the Common Stock are fully paid and
non-assessable.
Common Stock
Holders of Common Stock have the right to cast one vote for each
share held of record on all matters submitted to a vote of holders
of Common Stock, including the election of directors. Holders of
Common Stock do not have cumulative voting rights in the election
of directors. Holders of a majority of the voting power of the
capital stock issued and outstanding and entitled to vote,
represented in person or by proxy, are necessary to constitute a
quorum at any meeting of the Company's stockholders, and the vote
by the holders of a majority of such outstanding shares is
required to effect certain fundamental corporate changes such as
liquidation, merger or amendment of the Company's Articles of
Incorporation.
Holders of Common Stock are entitled to receive dividends pro rata
based on the number of shares held, when, as and if declared by
the Board of Directors, from funds legally available therefor. In
the event of the liquidation, dissolution or winding up of the
affairs of the Company, all assets and funds of the Company
remaining after the payment of all debts and other liabilities
shall be distributed, pro rata, among the holders of the Common
Stock. Holders of Common Stock are not entitled to pre-emptive or
subscription or conversion rights, and there are no redemption or
sinking fund provisions applicable to the Common Stock. All
outstanding shares of Common Stock are fully paid and non-
assessable.
Transfer Agent
Pacific Stock Transfer Company of Las Vegas, Nevada is the transfer
agent for the Shares.
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PART II
Item 1. Market Price of and Dividends on the Registrant's Common
Equity and Other Stockholder Matters
There is no present public market for the Company's Common Stock.
The Company anticipates applying to have the Common Stock traded
on the OTC Bulletin Board upon effectiveness of this registration
statement. There is no assurance that a public market will
materialize.
As of the date of this registration statement, there were thirty
four (34) registered shareholders in the Company.
None of the holders of the Company's Common Stock have any right
to require the Company to register any shares of the Company's
Common Stock pursuant to the Securities Act of 1933 (the "1933
Act").
The Company has not declared any dividends on its Common Stock
since its inception in August, 1998. There are no dividend
restrictions that limit the Company's ability to pay dividends on
Common Stock.
Item 2. Legal Proceedings
The Company is not currently a party to any legal proceedings.
Item 3. Changes in and Disagreements with Accountants
The Company has had no changes in or disagreements with its
accountants since its incorporation in August, 1998.
Item 4. Recent Sales of Unregistered Securities
The Company completed the issuance of 3,000,000 common shares to
Databoat International Limited at a deemed price of $0.01 per
share pursuant to the Acquisition Agreement dated February 2,
1999. These shares were issued Databoat pursuant to Section 4(2)
of the 1933 Act. Databoat is the registered and beneficial owner
or more than 10% of the Company's issued and outstanding Common
Stock. The 3,000,000 shares of Common Stock issued to Databoat
are "restricted" shares, as defined in the 1933 Act.
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The Company completed an offering of 2,000,000 shares of Common
Stock to nine (9) purchasers at a price of $0.01 per share on
February 15, 1999 pursuant to Rule 504 of Regulation D of the Act.
The offering was completed to persons known to the officers and
directors of the Company.
The Company completed an offering of 700,000 shares of Common
Stock to twenty-one (21) purchasers at a price of $0.20 per share
on February 17, 1999 pursuant to Rule 504 of Regulation D of the
Act. The offering was completed to persons known to the
officers and directors of the Company.
The Company completed an offering of 300,000 common shares to
twelve (12) purchasers at a price of $1.00 per share on March 31,
1999 pursuant to Rule 504 of Regulation D of the Act. The
offering was completed to persons known to the officers and
directors of the Company.
Item 5. Indemnification of Directors and Officers
The officers and directors of the Company are indemnified as
provided under the Nevada Revised Statutes (the "NRS") and the
Bylaws of the Company.
Under the NRS, director immunity from liability to a Company or
its shareholders for monetary liabilities applies automatically
unless it is specifically limited by a Company's articles of
incorporation (which is not the case with the Company's Articles
of Incorporation). Excepted from that immunity are: (i) a willful
failure to deal fairly with the Company or its shareholders in
connection with a matter in which the director has a material
conflict of interest; (ii) a violation of criminal law (unless the
director had reasonable cause to believe that his or her conduct
was lawful or no reasonable cause to believe that his or her
conduct was unlawful); (iii) a transaction from which the director
derived an improper personal profit; and (iv) willful misconduct.
The By-laws of the Company provide that the Company will indemnify
its directors and officers to the fullest extent not prohibited by
the Nevada General Company Law; provided, however, that the
Company may modify the extent of such indemnification by
individual contracts with its directors and officers; and,
provided, further, that the Company shall not be required to
indemnify any director or officer in connection with any
proceeding (or part thereof) initiated by such person unless (i)
such indemnification is expressly required to be made by law, (ii)
the proceeding was authorized by the Board of Directors of the
Company, (iii) such indemnification is provided by the Company, in
its sole discretion, pursuant to the powers vested in the Company
under the Nevada General Company Law or (iv) such indemnification
is required to be made pursuant to the By-laws.
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The By-laws of the Company provide that the Company will advance
to any person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that he is or was a director
or officer, of the Company, or is or was serving at the
request of the Company as a director or executive officer of
another Company, partnership, joint venture, trust or other
enterprise, prior to the final disposition of the proceeding,
promptly following request therefor, all expenses incurred by any
director or officer in connection with such proceeding upon
receipt of an undertaking by or on behalf of such person to repay
said amounts if it should be determined ultimately that such person
is not entitled to be indemnified under the By-laws of the Company
or otherwise.
The By-laws of the Company provide that no advance shall be made
by the Company to an officer of the Company (except by reason of
the fact that such officer is or was a director of the Company in
which event this paragraph shall not apply) in any action, suit or
proceeding, whether civil, criminal, administrative or
investigative, if a determination is reasonably and promptly made
(i) by the Board of Directors by a majority vote of a quorum
consisting of directors who were not parties to the proceeding, or
(ii) if such quorum is not obtainable, or, even if obtainable, a
quorum of disinterested directors so directs, by independent legal
counsel in a written opinion, that the facts known to the
decision-making party at the time such determination is made
demonstrate clearly and convincingly that such person acted in bad
faith or in a manner that such person did not believe to be in or
not opposed to the best interests of the Company.
<Page 34>
PART F/S
FINANCIAL STATEMENTS
The Company's audited Financial Statements, as described below,
are attached hereto.
1. Audited financial statements for the period ending April 30,
1999, including:
(a) Balance Sheet;
(b) Statement of Operations and Accumulated Deficit;
(c) Statement of Changes in Stockholders' Equity;
(d) Statement of Cash Flows;
(e) Notes to Financial Statements.
2. Consent of Sarna & Company, Certified Public Accountants
PART III
INDEX TO EXHIBITS
Exhibit 1: Articles of Incorporation
Exhibit 2: Certificate of Amendment of Articles of Incorporation
Exhibit 3: By-Laws of the Company
Exhibit 4: Acquisition Agreement between the Company, Databoat
International Limited and Scott Wurtele dated February
2, 1999
Exhibit 5: Escrow Agreement between the Company, Cane &
Company, LLC and Databoat International Limited dated
February 15, 1999
Exhibit 6: Management Consulting Agreement between the Company
and On-Line Design Ltd. dated February 15, 1999
<Page 35>
SIGNATURES
In accordance with Section 12 of the Securities Exchange Act of
1934, the registrant caused this registration statement to be
signed on its behalf by the undersigned, thereunto duly
authorized.
Date: July 7, 1999
WORLDBID CORPORATION
By: /S/ Logan Anderson
LOGAN ANDERSON
Director, President and
Chief Executive Officer
<Page 36>
WORLDBID CORPORATION
FINANCIAL STATEMENTS
APRIL 30, 1999
WITH
INDEPENDENT AUDITOR'S REPORT THEREON
<Page 37>
INDEX TO FINANCIAL STATEMENTS
-----------------------------
Page
----
Independent Auditor's Report. . . . . . . . . . . . . . 1
Financial Statements:
Balance Sheet . . . . . . . . . . . . . . . . . . . . 2
Statement of Operations
and Accumulated Deficit . . . . . . . . . . . . . . 3
Statement of Changes in Stockholders' Equity. . . . . 4
Statement of Cash Flows . . . . . . . . . . . . . . . 5
Notes to Financial Statements . . . . . . . . . . . . 6-12
Supplemental Statement:
Statement of Operating Expenses . . . . . . . . . . . 14
<Page 38>
INDEPENDENT AUDITORS' REPORT
----------------------------
To the Board of Directors
Worldbid Corporation
We have audited the accompanying balance sheet of Worldbid
Corporation, ("WBC"), a development stage company, as of April 30,
1999 and the related statements of operations and accumulated deficit,
changes in stockholders' equity, and statement of cash flows for the
period August 10, 1998 (INCEPTION) through April 30, 1999. These
financial statements are the responsibility of WBC'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 Worldbid
Corporation as of April 30, 1999, and the results of its operations,
changes in stockholders' equity and cash flows for period August 10,
1998 (INCEPTION) through April 30, 1999, in conformity with
generally accepted accounting principles.
Our audit was made for the purpose of forming an opinion on the
basic financial statements taken as a whole. The supplemental
statement of operating expenses is presented for the purposes of
additional analysis and is not a required part of the basic
financial statements and, in our opinion, is fairly stated in all
material respects in relation to the basic financial statements
taken as a whole.
Sarna & Company
Westlake Village, California
May 7, 1999
<Page 39>
WORLDBID CORPORATION
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
APRIL 30, 1999
ASSETS
Current Assets
Cash $ 366,239
---------
Total Current Assets $ 366,239
Property and Equipment
Web Site 30,000
Software Development 15,461
Web Site Development 14,840
--------
Net Property and Equipment 60,301
Other Assets
Domain Name Registration 70
Capitalized Start-up Costs 3,954
--------
Total Other Assets 4,024
----------
TOTAL ASSETS 430,564
==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts Payable and Accrued Expenses $ 5,612
-------
Total Current Liabilities $ 5,612
Stockholders' Equity
Common Stock, $0.001 par value
100,000,000 shares authorized,
6,000,000 shares issued 6,000
Additional Paid in Capital 484,000
Accumulated deficit <65,048>
-------
Total Stockholders' Equity 424,952
-------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 430,564
==========
See Notes to Financial Statements
2
<Page 40>
WORLDBID CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATIONS AND ACCUMULATED DEFICIT
FOR THE PERIOD AUGUST 10, 1998 (INCEPTION) THROUGH APRIL 30, 1999
Revenues $ 0
Operating Expenses <65,048>
-----------
Loss Before Provision for <65,048>
Income Taxes
Provision for Income Taxes <0>
-----------
Net Loss <65,048>
Deficit, August 10, 1999 (INCEPTION) <0>
-----------
Accumulated Deficit, April 30, 1999 $ <65,048>
===========
Net Loss per Share $ <0.01>
===========
Weighted Average Shares Outstanding 5,025,000
===========
See Notes to Financial Statements
3
<Page 41>
WORLDBID CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE PERIOD AUGUST 10, 1998 (INCEPTION) THROUGH APRIL 30, 1999
Common Stock Additional Accumulated Total
Dollar Paid in Deficit Stockholders'
Shares Amount Capital Equity
Balances
(INCEPTION) ---- $ ---- $ ---- $ ---- $ ----
August 10, 1998
Common Stock
Issued
Worldbid.Com
Web Site
Acquisition
February
2, 1999
$.01 per
share 3,000,000 3,000 27,000 ---- 30,000
Common Stock
Issued
First
Offering
February
15, 1999
$.01 per
share 2,000,000 2,000 18,000 ---- 20,000
Common Stock
Issued
Second
Offering
February
17,1999
$.20 per
share 700,000 700 139,300 ---- 140,000
Common Stock
Issued
Third
Offering
March 31,
1999
$1.00 per
share 300,000 300 299,700 ---- 300,000
Net Loss
Period
Ended
April 30,
1999 ---- ---- ---- (65,048) (65,048)
--------------------------------------------------
Balances
April 30,
1999 6,000,000 $ 6,000 $ 484,000 $ (65,048) $ 424,952
====================================================
See Notes to Financial Statements
4
<Page 42>
WORLDBID CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOWS
FOR THE PERIOD AUGUST 10, 1998 (INCEPTION) THROUGH APRIL 30, 1999
Cash Flows from Operating Activities:
Net Loss $ <65,048>
Adjustments to Reconcile Net Income to
Net Cash Provided by Operating Activities
<Increase> Decrease in:
Other Assets <4,024>
Increase <Decrease> in:
Accounts Payable and
Accrued Expenses 5,612
---------
Net Cash Used by Operating Activities <63,460>
=========
Cash Flows from Investing Activities:
Assets Acquired for Stock $ <30,000>
Software Development Costs <15,461>
Web Site Development Costs <14,840>
---------
Net Cash Used by Investing Activities <60,301>
Cash Flows from Financing Activities:
Net Proceeds from the Issuance of
Common Stock 490,000
---------
Net Cash Provided by Financing Activities 490,000
---------
Net Increase in Cash 366,239
Cash at Beginning of Period 0
---------
Cash at End of Period $ 366,239
========
See Notes to Financial Statements
5
<Page 43>
WORLDBID CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
- ---------------------------------------------------
General
Worldbid Corporation (the "Company" or "WBC") was originally
incorporated on August 10, 1998 in the state of Nevada as
"Tethercam Systems, Inc.". On January 15, 1999 the Company
changed its name to Worldbid Corporation.
The Company is engaged in the acquisition and development of
proprietary commercial web sites. WBC plans to earn revenues from
advertising generated on these sites and through e-mail that targets
potential suppliers. The Company's initial business is transacted
through its current Internet web site located at "www.worldbid.com".
This site is still in the development stage.
Basis of Presentation
The Company reports revenue and expenses using the accrual method
of accounting for financial and tax reporting purposes.
Use of Estimates
Management uses estimates and assumptions in preparing these
financial statements in accordance with generally accepted
accounting principles. Those estimates and assumptions affect the
reported amounts of assets and liabilities, the disclosure of
contingent assets and liabilities, and the reported revenues and
expenses.
Development Stage Company
WBC meets the guidelines of SFAS No. 7 and as such is classified
as a development stage company.
6
<Page 44>
WORLDBID CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
Pro Forma Compensation Expense
WBC accounts for costs of stock-based compensation in accordance
with APB No. 25, "Accounting for Stock Based Compensation" instead
of the fair value based method in SFAS No. 123. No stock options
have been issued by WBC. Accordingly, no pro forma compensation
expense is reported in these financial statements.
Depreciation, Amortization and Capitalization
The Company records depreciation and amortization when appropriate
using both straight-line and declining balance methods over the
estimated useful life of the assets (five to seven years).
Expenditures for maintenance and repairs are charged to expense as
incurred. Additions, major renewals and replacements that increase
the property's useful life are capitalized. Property sold or
retired, together with the related accumulated depreciation, is
removed from the appropriate accounts and the resultant gain or
loss is included in net income.
Income Taxes
The Company accounts for its income taxes in accordance with
Statement of Financial Accounting Standards No. 109, "Accounting
for Income Taxes". Under Statement 109, a liability method is
used whereby deferred tax assets and liabilities are determined
based on temporary differences between basis used for financial
reporting and income tax reporting purposes. Income taxes are
provided based on tax rates in effect at the time such temporary
differences are expected to reverse. A valuation allowance is
provided for certain deferred tax assets if it is more likely
than not, that the Company will not realize the tax assets through
future operations.
7
<Page 45>
WORLDBID CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
- ---------------------------------------------------------------
Fair Value of Financial Instruments
Financial accounting Standards Statement No. 107, "Disclosures
About Fair Value of Financial Instruments", requires the Company
to disclose, when reasonably attainable, the fair market values
of its assets and liabilities which are deemed to be financial
instruments. The Company's financial instruments consist primarily
of cash and certain investments.
Per Share Information
The Company computes per share information by dividing the net
loss for the period presented by the weighted average number of
shares outstanding during such period.
Year 2000 Compliance
The Year 2000 issue is the result of computer programs having been
written using two digits (rather than four) to define years.
Computers or other equipment with date-sensitive software may
recognize "00" as 1900 rather than 2000. This could result in
system failures or miscalculations. If the Company or significant
customers, suppliers or other third parties fail to correct Year
2000 issues, the Company's ability to operate could be affected.
The following disclosure is pursuant to the Year 2000 Readiness
and Disclosure Act.
Worldbid's Year 2000 program is designed to minimize the
possibility of Year 2000 interruptions. Any such interruption may
have a material adverse impact on the Company's future operating
results. In 1999, the Company established procedures to identify
and assess systems and processes vulnerable to Year 2000 problems.
The Company also developed procedures to monitor levels of
compliance within its stated goals of compliance.
8
<Page 46>
WORLDBID CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
- ---------------------------------------------------------------
In each area of vulnerability, various testing and readiness
methodologies are being used to identify and correct suspect
systems, processes or supplier interfaces. The Company projects to
meet its Year 2000 compliance goals prior to the end of third
quarter 1999.
NOTE 2 - ACQUISITION OF WORLDBID.COM
- ------------------------------------
On February 2, 1999 the Company acquired the web site
"worldbid.com" together with all software, tangible and
intellectual assets and rights associated with that site from
Databoat International Limited (Databoat). The Company has issued
to Databoat a total of 3,000,000 restricted shares of common stock
(Databoat Share) pursuant to an acquisition agreement. The Company
has also entered into a one year consulting agreement with
Databoat's principal stockholder, Mr. Scott Wurtele and On-Line
Design, a company owned 100% by him.
The Company and Databoat have agreed that the Databoat Shares
will be held in escrow for a period of one year on the terms and
conditions of an escrow agreement between the Company, Databoat
and Cane & Company, the attorneys for the company (the "Escrow
Agreement"). The Databoat Shares will be released to Databoat in
accordance with the Escrow Agreement, commencing on the date
which is one year from the date of Closing on the following
schedule:
Anniversary of Closing Date Number of Shares
--------------------------- ----------------
One Year 300,000 shares
Two Year 700,000 shares
Three Year 1,000,000 shares
In the event that the Company determines prior to the date which
is one year from the date of Closing not to pursue development and
commercialization of the Worldbid business, the Company will have
the option to cause Databoat to deliver all of the Databoat Shares
to the Company for cancellation.
9
<Page 47>
WORLDBID CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 2 - ACQUISITION OF WORLDBID.COM - CONTINUED
- ------------------------------------------------
In the event that the Company exercises its right to cause the
Databoat Shares to be delivered to the Company in accordance with
the terms and conditions of the Escrow Agreement, Databoat will
have the right to acquire the Worldbid web site and related
business for a purchase price of $10.00. In the event of delivery
of the Databoat Shares to the Company pursuant to the Escrow
Agreement and exercise by Databoat of its option to acquire the
Worldbid web site and related business, each of the Company and
Databoat will have no further liability or obligation to the other.
In the event that, during the one year period commencing on the
Closing Date, the Company does not advance towards the Worldbid
web site and related business sufficient funds for the
Company to complete the expenditures set forth in the Company's
business plan ($300,000), as attached to the Acquisition Agreement
or in any revised business plan approved by the board of
directors of the Company, then Databoat will be entitled to deliver
notice to the Company demanding that the Company advance to the
Worldbid web site and related business sufficient
funds to enable the Company to meet the objectives of the business
plan (a "Demand Notice"). Upon receipt of a Demand Notice, the Company
will have a period of thirty (30) days in which
to provide the required funding to bring the Company current with the
expenditures required under the business plan.
The Company has agreed with Databoat pursuant to the Acquisition
Agreement that in the event that, during the one year period
commencing on the Closing Date, the Company elects not to or fails
to provide the necessary funding to the Worldbid business or in the
event Mr. Wurtele terminates the Management Consulting Agreement,
pursuant to Section 6.3 of the Management
Consulting Agreement as a result of a material breach by the Company,
Databoat will have the option to put the Databoat Shares to the
Company in exchange for the transfer by the Company
to Databoat of the Worldbid web site and related business to Databoat,
the Databoat Shares will be released to the Company and each of the
Company, Mr. Wurtele and Databoat will have no further liability or
obligation to the other.
10
<Page 48>
WORLDBID CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 2 - ACQUISITION OF WORLDBID.COM - CONTINUED
The Company has also agreed with Databoat pursuant to the Acquisition
Agreement that in the event that the shares of the Company or any
successor are not listed or quoted for trading on any public trading
market, including NASDAQ Small Cap Market, the OTC Bulletin Board
or an electronic quotation service, within the date which is eighteen
months from the Closing Date, then Databoat will have the right to
purchase the Worldbid web site and related business from the
Company in consideration for the transfer of the Databoat Shares to
the Company. Databoat must give notice of its election within 30
days of the date which is eighteen months from the Closing Date.
Upon receipt of notice of election, the Company will execute and
deliver an executed general conveyance of specific business assets
to Databoat upon presentation of the Databoat Shares released from
escrow. Each party will give joint instruction to the escrow agent
as required to deliver the balance of the Databoat Shares to the
Company.
NOTE 3 - PROVISION FOR INCOME TAXES
The provision for income taxes for the period ended April 30, 1999
represents the minimum state income tax expense of the Company, which
is not considered significant.
NOTE 4 - COMMITMENTS AND CONTINGENCIES
Operating Leases
The Company currently rents administrative office space under a monthly
renewable contract.
Management Consulting Agreement
The Company has entered into a consulting agreement with On-Line
Design, a British Columbia company owned 100% by Mr. Wurtele. The
Company will pay $5,000 per month for a period of
one year expiring February 16, 2000. In exchange for these payments,
On-Line Design will provide management and continued development of
the Company's business.
11
<Page 49>
WORLDBID CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 4 - COMMITMENTS AND CONTINGENCIES - CONTINUED
Litigation
The Company is not presently involved in any litigation.
NOTE 5 - RELATED PARTY TRANSACTIONS
The Company has entered into a one year consulting agreement (see
management consulting agreement), with On-Line Design, a company
owned 100% by Mr. Scott Wurtele. Databoat, a major stockholder of
WBC, is also controlled 100% by Mr. Scott Wurtele (see Acquisition
of Worldbid.Com).
12
<Page 50>
SUPPLEMENTAL STATEMENT
<Page 51>
WORLDBID CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATING EXPENSES
FOR THE PERIOD AUGUST 10, 1998 (INCEPTION) THROUGH APRIL 30, 1999
Operating Expenses
Accounting $ 4,870
Legal Fees 24,962
Market Research and Development 29,137
Office Supplies 796
Postage & Delivery 348
Telephone 1,935
Web Site Management 3,000
--------
Total Operating Expenses $ 65,048
=========
See Notes to Financial Statements
14
<Page 52>
SARNA & COMPANY
Certified
Public
Accountants
- -----------
-----------------------------------------
310 Westlake 805
N. Westlake Village 371-8900
Boulevard California Fax 805
Suite 270 91362 379-0140
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the inclusion of our audit report dated May 7, 1999,
on the financial statements of Worldbid Corporation (the "Company") for
the period ended April 30, 1999 in the Company's Form 10-SB registration
statement to be filed with the United States Securities and Exchange
Commission. We also consent to the application of such report to the
financial information in the Form 10-SB, when such financial information
is read in conjunction with the financial statements referred to in our
report.
\s\ Sarna & Company
Sarna & Company
Certified Public Accountants
Westlake Village, California
July 1, 1999
<Page 53>
ARTICLES OF INCORPORATION
OF
TetherCam Systems Corp.
-----------------------
KNOW ALL MEN BY THESE PRESENTS: That the undersigned, pursuant to
Chapter 78 of the Nevada Revised Statutes, has this day made and
filed these Articles of Incorporation and DOES HEREBY CERTIFY:
1. Name. The name of the Corporation shall be:
TetherCam Systems Corp.
2. Principal Office. The principal office or place of business for
the corporation shall be located at 6121 Lakeside Drive, Suite 260,
Reno, Nevada 89511-8527. The corporation may also maintain offices,
transact corporate business, and hold meetings of directors and
shareholders at other places in Nevada or outside the State. The name
and address of its Resident Agent are Richard W. Harris, Esq., 6121
Lakeside Drive, Suite 260, Reno, Nevada 89511 8527.
3. Purpose. The nature of the business, objects, and purposes to be
transacted, promoted, and carried out by the corporation shall be: To
engage in any lawful activity within or without the State of Nevada.
4. Term. The corporation shall have perpetual existence.
5. Capitalization. The amount of the total authorized capital of the
-1-
<Page 54>
corporation shall consist of ONE HUNDRED MILLION (100,000,000)
shares with a par value of $0.001 per share. All of the shares
shall be of one class, without series or other distinction, and
shall be designated as "Common Stock".
6. Assessments. The capital stock, after the amount of the
subscription price has been fully paid, shall not be subject to
assessment for any purpose whatsoever.
7. Directors. The governing board of the corporation shall be styled
"Directors", and the first Board shall be one (1) in number. The
number of directors shall not be reduced to fewer than one, and
may, at any time or times, be increased or decreased in such manner
as provided in the By-Laws of the corporation.
The names and addresses of the first Board of Directors are as
follows:
Name Address
- ---- -------
Logan Anderson Unit 45, Locavia Condominiums
Seven Mile Beach
Cayman Islands, BWI
8. Election of Directors. At all elections of directors of the
corporation each stockholder possessing voting power is entitled
to as many votes as equal the number of directors to be elected.
He or she may cast all of such votes for a single director or may
distribute them among the number to be voted upon or any two or
more of them, as he or she may see fit.
-2-
<Page 55>
9. Powers of Directors. In furtherance, and not in limitation of the
powers conferred by statute, the Board of Directors is expressly
authorized:
a. To make, alter, amend and rescind the By-Laws of the corporation.
b. To fix the amount to be reserved as working capital.
c. To fix the times for the declaration and payment of
dividends.
d. To authorize and cause to be executed mortgages and liens upon
the real and personal property of the corporation.
e. To sell, assign, transfer or otherwise dispose of the property
of the corporation as an entirety with the consent in writing or
pursuant to the affirmative vote of the holders of a majority of
the stock issued and outstanding, at a stock-holders' meeting duly
called for that purpose.
f. To sell, assign, transfer, lease and in any lawful manner dispose
of such portions of said property as the Board of Directors shall
deem advisable, and to use and apply the funds received in payment
therefor to the surplus account for the benefit of the corporation,
or the payment of dividends, or otherwise; provided that a majority
of the whole Board concur therein, and further provided that the
capital stock shall not be decreased except in accordance with the
laws of Nevada.
-3-
<Page 56>
g. By a resolution passed by a majority of the whole Board, under
suitable provision of the By-Laws, to designate two or more of
their numbers to constitute an executive committee, which committee
shall have and exercise any and all of the powers of the Board of
Directors which may be lawfully delegated in the management of the
business and affairs of the corporation, and shall have the authority
to cause the seal of the corporation to be affixed to all papers
which may require it.
h. To determine from time to time whether (and if allowed, under what
conditions and regulations) the accounts and books of the corporation
(other than the books required by law to be kept at the principal
office of the corporation in Nevada), or any of them shall be open
to the inspection of the stockholders, and the stockholders' rights
in this respect are and shall be restricted or limited accordingly.
10. Liability of Directors and Officers. An officer or director of
the corporation shall have no personal liability to the corporation
or its stockholders for damages for breach of fiduciary duty as an
officer or director except for (a) acts or omissions which involve
intentional misconduct, fraud, or a knowing violation of the law and
(b) the payment of dividends in violation of N.R.S. 78.300.
11. Indemnification of Officers and Directors. Every person who was
or is a party to, or is threatened to be made a party to, or is
involved in any
-4-
<Page 57>
action, suit or proceeding, whether civil, criminal, administrative
or investigative, by reason of the fact that he or she or a person
of whom he or she is the legal representative is or was a director
or officer of the corporation or is or was serving at the request
of the corporation as a director or officer of another corporation,
or as its representative in a partnership, joint venture, trust or
other enterprise, shall be indemnified and held harmless to the
fullest extent legally permissible under the laws of the State of
Nevada from time to time against all expenses, liability and loss
(including attorney's fees, judgments, fines and amounts paid or
to be paid in settlement) reasonably incurred or suffered by him
or her in connection therewith. Such right of indemnification
shall be a contract right which may be enforced in any manner
desired by such person. Such right of indemnification which such
directors, officers, or representatives may have or hereafter acquire
shall extend to all actions undertaken on behalf of the corporation;
and, without limiting the generality of such statement, they shall
be entitled to their respective rights of indemnification under
any By-Laws, agreement, vote of stockholders, provision of law or
otherwise, as well as their rights under this Article.
Without limiting the application of the foregoing, the Board of
Directors may adopt By-Laws from time to time with respect to
indemnification to provide at all times the fullest indemnification
permitted by the laws of the State of Nevada and may cause the
corporation to purchase and maintain insurance on
-5-
<Page 58>
behalf of any person who is or was a director or officer of the
corporation, or is or was serving at the request of the corporation
as a director or officer of another corporation, or as its
representative in a partnership, joint venture, trust or other
enterprises against any liability asserted against such person
and incurred in any such capacity or arising out of such status,
whether or not the corporation would have the power to indemnify
such person.
12. Amendment. The corporation reserves the right to amend, alter
or repeal any provisions contained in these Articles of
Incorporation in the manner now or hereafter prescribed by statute,
and all rights conferred on stockholders herein are granted subject
to this reservation.
13. Incorporator. The name and post office address of the person
signing these Articles of Incorporation are as follows:
Richard W. Harris
6121 Lakeside Drive, Suite 260
Reno, Nevada 89511-8527
IN WITNESS WHEREOF, I have hereunto set my hand this 7th day of
August, 1998, hereby declaring and certifying that the facts
stated hereinabove are true and correct to the best of my knowledge.
\s\ Richard W. Harris
- ---------------------
RICHARD W. HARRIS
-6-
<Page 59>
CERTIFICATE OF ACCEPTANCE OF
APPOINTMENT BY RESIDENT AGENT
-----------------------------
I, RICHARD W. HARRIS, hereby certify that on the 7th day of August,
1998, I accepted appointment as Resident Agent of TetherCam Systems
Corp. in accordance with NRS 78.090. The principal office in the
State is located at 6121 Lakeside Drive, Suite 260, Reno, Nevada
89511-8527, Washoe County, Nevada.
DATED this 7th day of August, 1998.
\s\ Richard W. Harris
- ---------------------
RICHARD W. HARRIS
STATE OF NEVADA )
) SS.
COUNTY OF WASHOE )
On this 7th day of August, 1998, personally appeared before me, a Notary
Public, RICHARD W. HARRIS, personally known to me, who acknowledged to me
that he executed the foregoing Articles of Incorporation.
\s\ Betty Carlson
- -----------------
NOTARY PUBLIC
-7-
<Page 60>
CERTIFICATE OF AMENDMENT OF ARTICLES OF INCORPORATION
(After issuance of Stock) Filed by:
TetherCam Systems Corporation
We the undersigned President and Secretary of TetherCam
Systems Corporation do certify:
That the Board of Directors of said corporation at a
meeting duly convened, held on the 12TH day of January,
1999, adopted a resolution to amend the original articles
as follows:
Article I is hereby amended to read as follows:
The name of this corporation is Worldbid Corporation.
The number of shares of the corporation outstanding and
entitled to vote on an amendment to the Articles of
Incorporation is 1 common share. Said change and amendment
has been consented to and approved by a majority vote of
the stockholders holding at least a majority of each class
of stock outstanding and entitled to vote thereon.
\s\ Logan B. Anderson
___________________________
President*, Logan B. Anderson
\s\ Logan B. Anderson
___________________________
Secretary, Logan B. Anderson
Province of British Columbia )
) ss.
Country of Canada )
On January 15, 1999, personally appeared before me, a
Notary Public, Logan B. Anderson, who acknowledged
that they executed the above instrument.
\s\ Michael H. Taylor
____________________________
Signature of Notary
Notary stamp or seal
Michael H. Taylor
Barrister & Solicitor
Suite 1880, Royal Centre
1055 West Georgia Street, Box 11122
Vancouver, B.C.
V5E 3P3
*only the President's signature need be acknowledge.
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BYLAWS
OF
WORLDBID CORPORATION
(A NEVADA CORPORATION)
ARTICLE I
OFFICES
Section 1. Registered Office. The registered office of the
corporation in the State of Nevada shall be in the City of Las
Vegas, State of Nevada.
Section 2. Other Offices. The corporation shall also have
and maintain an office or principal place of business at such place
as may be fixed by the Board of Directors, and may also have
offices at such other places, both within and without the State of
Nevada as the Board of Directors may from time to time determine or
the business of the corporation may require.
ARTICLE II
CORPORATE SEAL
Section 3. Corporate Seal. The corporate seal shall consist
of a die bearing the name of the corporation and the inscription,
"Corporate Seal-Nevada." Said seal may be used by causing it or a
facsimile thereof to be impressed or affixed or reproduced or
otherwise.
ARTICLE III
STOCKHOLDERS' MEETINGS
Section 4. Place of Meetings. Meetings of the stockholders
of the corporation shall be held at such place, either within or
without the State of Nevada, as may be designated from time to time
by the Board of Directors, or, if not so designated, then at the
office of the corporation required to be maintained pursuant to
Section 2 hereof.
Section 5. Annual Meeting.
(a) The annual meeting of the stockholders of the
corporation, for the purpose of election of directors and for such
other business as may lawfully come before it, shall be held on
such date and at such time as may be designated from time to time
by the Board of Directors.
(b) At an annual meeting of the stockholders, only such
business shall be conducted as shall have been properly brought
before the meeting. To be properly brought before an annual
meeting, business must be: (A) specified in the notice of meeting
(or any supplement thereto) given by or at the direction of the
Board of Directors, (B) otherwise properly brought before the
meeting
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by or at the direction of the Board of Directors, or (C)
otherwise properly brought before the meeting by a stockholder.
For business to be properly brought before an annual meeting by a
stockholder, the stockholder must have given timely notice thereof
in writing to the Secretary of the corporation. To be timely, a
stockholder's notice must be delivered to or mailed and received at
the principal executive offices of the corporation not later than
the close of business on the sixtieth (60th) day nor earlier than
the close of business on the ninetieth (90th) day prior to the
first anniversary of the preceding year's annual meeting; provided,
however, that in the event that no annual meeting was held in the
previous year or the date of the annual meeting has been changed by
more than thirty (30) days from the date contemplated at the time
of the previous year's proxy statement, notice by the stockholder
to be timely must be so received not earlier than the close of
business on the ninetieth (90th) day prior to such annual meeting
and not later than the close of business on the later of the
sixtieth (60th) day prior to such annual meeting or, in the event
public announcement of the date of such annual meeting is first
made by the corporation fewer than seventy (70) days prior to the
date of such annual meeting, the close of business on the tenth
(10th) day following the day on which public announcement of the
date of such meeting is first made by the corporation. A
stockholder's notice to the Secretary shall set forth as to each
matter the stockholder proposes to bring before the annual meeting:
(i) a brief description of the business desired to be brought
before the annual meeting and the reasons for conducting such
business at the annual meeting, (ii) the name and address, as they
appear on the corporation's books, of the stockholder proposing
such business, (iii) the class and number of shares of the
corporation which are beneficially owned by the stockholder, (iv)
any material interest of the stockholder in such business and (v)
any other information that is required to be provided by the
stockholder pursuant to Regulation 14A under the Securities
Exchange Act of 1934, as amended (the "1934 Act"), in his capacity
as a proponent to a stockholder proposal. Notwithstanding the
foregoing, in order to include information with respect to a
stockholder proposal in the proxy statement and form of proxy for
a stockholder's meeting, stockholders must provide notice as
required by the regulations promulgated under the 1934 Act.
Notwithstanding anything in these Bylaws to the contrary, no
business shall be conducted at any annual meeting except in
accordance with the procedures set forth in this paragraph (b).
The chairman of the annual meeting shall, if the facts warrant,
determine and declare at the meeting that business was not properly
brought before the meeting and in accordance with the provisions of
this paragraph (b), and, if he should so determine, he shall so
declare at the meeting that any such business not properly brought
before the meeting shall not be transacted.
(c) Only persons who are confirmed in accordance with the
procedures set forth in this paragraph (c) shall be eligible for
election as directors. Nominations of persons for election to the
Board of Directors of the corporation may be made at a meeting of
stockholders by or at the direction of the Board of Directors or by
any stockholder of the corporation entitled to vote in the election
of directors at the meeting who complies with the notice procedures
set forth in this paragraph (c). Such nominations, other than
those made by or at the direction of the Board of Directors, shall
be made pursuant to timely notice in writing to the Secretary of
the corporation in accordance with the provisions of paragraph (b)
of this Section 5. Such stockholder's notice shall set forth (i)
as to each person, if any, whom the stockholder proposes to
nominate for election or re-election as a director: (A) the name,
age, business address and residence address of such person, (B) the
principal occupation or employment of such person, (c) the class
and number of shares of the corporation which are beneficially
owned by such person, (D) a description of all arrangements or
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understandings between the stockholder and each nominee and any
other person or persons (naming such person or persons) pursuant to
which the nominations are to be made by the stockholder, and (E)
any other information relating to such person that is required to
be disclosed in solicitations of proxies for election of directors,
or is otherwise required, in each case pursuant to Regulation 14A
under the 1934 Act (including without limitation such person's
written consent to being named in the proxy statement, if any, as
a nominee and to serving as a director if elected); and (ii) as to
such stockholder giving notice, the information required to be
provided pursuant to paragraph (b) of this Section 5. At the
request of the Board of Directors, any person nominated by a
stockholder for election as a director shall furnish to the
Secretary of the corporation that information required to be set
forth in the stockholder's notice of nomination which pertains to
the nominee. No person shall be eligible for election as a
director of the corporation unless nominated in accordance with the
procedures set forth in this paragraph (c). The chairman of the
meeting shall, if the facts warrant, determine and declare at the
meeting that a nomination was not made in accordance with the
procedures prescribed by these Bylaws, and if he should so
determine, he shall so declare at the meeting, and the defective
nomination shall be disregarded.
(d) For purposes of this Section 5, "public announcement"
shall mean disclosure in a press release reported by the Dow Jones
News Service, Associated Press or comparable national news service
or in a document publicly filed by the corporation with the
Securities and Exchange Commission pursuant to Section 13, 14 or
15(d) of the Exchange Act.
Section 6. Special Meetings.
(a) Special meetings of the stockholders of the corporation
may be called, for any purpose or purposes, by (i) the Chairman of
the Board of Directors, (ii) the Chief Executive Officer, or (iii)
the Board of Directors pursuant to a resolution adopted by a
majority of the total number of authorized directors (whether or
not there exist any vacancies in previously authorized
directorships at the time any such resolution is presented to the
Board of Directors for adoption), and shall be held at such place,
on such date, and at such time as the Board of Directors, shall
determine.
(b) If a special meeting is called by any person or persons
other than the Board of Directors, the request shall be in writing,
specifying the general nature of the business proposed to be
transacted, and shall be delivered personally or sent by registered
mail or by telegraphic or other facsimile transmission to the
Chairman of the Board of Directors, the Chief Executive Officer, or
the Secretary of the corporation. No business may be transacted at
such special meeting otherwise than specified in such notice. The
Board of Directors shall determine the time and place of such
special meeting, which shall be held not less than thirty-five (35)
nor more than one hundred twenty (120) days after the date of the
receipt of the request. Upon determination of the time and place
of the meeting, the officer receiving the request shall cause
notice to be given to the stockholders entitled to vote, in
accordance with the provisions of Section 7 of these Bylaws. If
the notice is not given within sixty (60) days after the receipt of
the request, the person or persons requesting the meeting may set
the time and place of the meeting and give the notice. Nothing
contained in this paragraph (b) shall be construed as limiting,
fixing, or affecting the time when a meeting of stockholders called
by action of the Board of Directors may be held.
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Section 7. Notice of Meetings. Except as otherwise provided
by law or the Articles of Incorporation, written notice of each
meeting of stockholders shall be given not less than ten (10) nor
more than sixty (60) days before the date of the meeting to each
stockholder entitled to vote at such meeting, such notice to
specify the place, date and hour and purpose or purposes of the
meeting. Notice of the time, place and purpose of any meeting of
stockholders may be waived in writing, signed by the person
entitled to notice thereof, either before or after such meeting,
and will be waived by any stockholder by his attendance thereat in
person or by proxy, except when the stockholder attends a meeting
for the express purpose of objecting, at the beginning of the
meeting, to the transaction of any business because the meeting is
not lawfully called or convened. Any stockholder so waiving notice
of such meeting shall be bound by the proceedings of any such
meeting in all respects as if due notice thereof had been given.
Section 8. Quorum. At all meetings of stockholders, except
where otherwise provided by statute or by the Articles of
Incorporation, or by these Bylaws, the presence, in person or by
proxy duly authorized, of the holder or holders of not less than
one percent (1%) of the outstanding shares of stock entitled to
vote shall constitute a quorum for the transaction of business. In
the absence of a quorum, any meeting of stockholders may be
adjourned, from time to time, either by the chairman of the meeting
or by vote of the holders of a majority of the shares represented
thereat, but no other business shall be transacted at such meeting.
The stockholders present at a duly called or convened meeting, at
which a quorum is present, may continue to transact business until
adjournment, notwithstanding the withdrawal of enough stockholders
to leave less than a quorum. Except as otherwise provided by law,
the Articles of Incorporation or these Bylaws, all action taken by
the holders of a majority of the votes cast, excluding abstentions,
at any meeting at which a quorum is present shall be valid and
binding upon the corporation; provided, however, that directors
shall be elected by a plurality of the votes of the shares present
in person or represented by proxy at the meeting and entitled to
vote on the election of directors. Where a separate vote by a
class or classes or series is required, except where otherwise
provided by the statute or by the Articles of Incorporation or
these Bylaws, a majority of the outstanding shares of such class or
classes or series, present in person or represented by proxy, shall
constitute a quorum entitled to take action with respect to that
vote on that matter and, except where otherwise provided by the
statute or by the Articles of Incorporation or these Bylaws, the
affirmative vote of the majority (plurality, in the case of the
election of directors) of the votes cast, including abstentions, by
the holders of shares of such class or classes or series shall be
the act of such class or classes or series.
Section 9. Adjournment and Notice of Adjourned Meetings. Any
meeting of stockholders, whether annual or special, may be
adjourned from time to time either by the chairman of the meeting
or by the vote of a majority of the shares casting votes, excluding
abstentions. When a meeting is adjourned to another time or place,
notice need not be given of the adjourned meeting if the time and
place thereof are announced at the meeting at which the adjournment
is taken. At the adjourned meeting, the corporation may transact
any business which might have been transacted at the original
meeting. If the adjournment is for more than thirty (30) days or
if after the adjournment a new record date is fixed for the
adjourned meeting, a notice of the adjourned meeting shall be given
to each stockholder of record entitled to vote at the meeting.
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Section 10. Voting Rights. For the purpose of
determining those stockholders entitled to vote at any meeting of
the stockholders, except as otherwise provided by law, only persons
in whose names shares stand on the stock records of the corporation
on the record date, as provided in Section 12 of these Bylaws,
shall be entitled to vote at any meeting of stockholders. Every
person entitled to vote shall have the right to do so either in
person or by an agent or agents authorized by a proxy granted in
accordance with Nevada law. An agent so appointed need not be a
stockholder. No proxy shall be voted after three (3) years from
its date of creation unless the proxy provides for a longer period.
Section 11. Joint Owners of Stock. If shares or other
securities having voting power stand of record in the names of two
(2) or more persons, whether fiduciaries, members of a partnership,
joint tenants, tenants in common, tenants by the entirety, or
otherwise, or if two (2) or more persons have the same fiduciary
relationship respecting the same shares, unless the Secretary is
given written notice to the contrary and is furnished with a copy
of the instrument or order appointing them or creating the
relationship wherein it is so provided, their acts with respect to
voting shall have the following effect: (a) if only one (1) votes,
his act binds all; (b) if more than one (1) votes, the act of the
majority so voting binds all; (c) if more than one (1) votes, but
the vote is evenly split on any particular matter, each faction may
vote the securities in question proportionally, or may apply to the
Nevada Court of Chancery for relief as provided in the General
Corporation Law of Nevada, Section 217(b). If the instrument filed
with the Secretary shows that any such tenancy is held in unequal
interests, a majority or even-split for the purpose of subsection
(c) shall be a majority or even-split in interest.
Section 12. List of Stockholders. The Secretary shall
prepare and make, at least ten (10) days before every meeting of
stockholders, a complete list of the stockholders entitled to vote
at said meeting, arranged in alphabetical order, showing the
address of each stockholder and the number of shares registered in
the name of each stockholder. Such 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 (10) 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 specified, at
the place where the meeting is to be held. The list shall be
produced and kept at the time and place of meeting during the whole
time thereof and may be inspected by any stockholder who is
present.
Section 13. Action Without Meeting. No action shall be
taken by the stockholders except at an annual or special meeting of
stockholders called in accordance with these Bylaws, or by the
written consent stockholders.
Section 14. Organization.
(a) At every meeting of stockholders, the Chairman of the
Board of Directors, or, if a Chairman has not been appointed or is
absent, the President, or, if the President is absent, a chairman
of the meeting chosen by a majority in interest of the stockholders
entitled to vote, present in person or by proxy, shall act as
chairman. The Secretary, or, in his absence, an Assistant
Secretary directed to do so by the President, shall act as
secretary of the meeting.
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(b) The Board of Directors of the corporation shall be
entitled to make such rules or regulations for the conduct of
meetings of stockholders as it shall deem necessary, appropriate or
convenient. Subject to such rules and regulations of the Board of
Directors, if any, the chairman of the meeting shall have the right
and authority to prescribe such rules, regulations and procedures
and to do all such acts as, in the judgment of such chairman, are
necessary, appropriate or convenient for the proper conduct of the
meeting, including, without limitation, establishing an agenda or
order of business for the meeting, rules and procedures for
maintaining order at the meeting and the safety of those present,
limitations on participation in such meeting to stockholders of
record of the corporation and their duly authorized and constituted
proxies and such other persons as the chairman shall permit,
restrictions on entry to the meeting after the time fixed for the
commencement thereof, limitations on the time allotted to questions
or comments by participants and regulation of the opening and
closing of the polls for balloting on matters which are to be voted
on by ballot. Unless and to the extent determined by the Board of
Directors or the chairman of the meeting, meetings of stockholders
shall not be required to be held in accordance with rules of
parliamentary procedure.
ARTICLE IV
DIRECTORS
Section 15. Number and Qualification. The authorized
number of directors of the corporation shall be not less than one
(1) nor more than twelve (12) as fixed from time to time by
resolution of the Board of Directors; provided that no decrease in
the number of directors shall shorten the term of any incumbent
directors. Directors need not be stockholders unless so required
by the Articles of Incorporation. If for any cause, the directors
shall not have been elected at an annual meeting, they may be
elected as soon thereafter as convenient at a special meeting of
the stockholders called for that purpose in the manner provided in
these Bylaws.
Section 16. Powers. The powers of the corporation shall
be exercised, its business conducted and its property controlled by
the Board of Directors, except as may be otherwise provided by
statute or by the Articles of Incorporation.
Section 17. Election and Term of Office of Directors.
Members of the Board of Directors shall hold office for the terms
specified in the Articles of Incorporation, as it may be amended
from time to time, and until their successors have been elected as
provided in the Articles of Incorporation.
Section 18. Vacancies. Unless otherwise provided in the
Articles of Incorporation, any vacancies on the Board of Directors
resulting from death, resignation, disqualification, removal or
other causes and any newly created directorships resulting from any
increase in the number of directors, shall unless the Board of
Directors determines by resolution that any such vacancies or newly
created directorships shall be filled by stockholder vote, be
filled only by the affirmative vote of a majority of the directors
then in office, even though less than a quorum of the Board of
Directors. Any director elected in accordance with the preceding
sentence shall hold office for the remainder of the full term of
the director for which the vacancy was created or occurred and
until such director's successor shall have been elected and
qualified. A vacancy in the Board of Directors
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shall be deemed to exist under this Bylaw in the case of the death,
removal or resignation of any director.
Section 19. Resignation. Any director may resign at any
time by delivering his written resignation to the Secretary, such
resignation to specify whether it will be effective at a particular
time, upon receipt by the Secretary or at the pleasure of the Board
of Directors. If no such specification is made, it shall be deemed
effective at the pleasure of the Board of Directors. When one or
more directors shall resign from the Board of Directors, effective
at a future date, a majority of the directors then in office,
including those who have so resigned, shall have power to fill such
vacancy or vacancies, the vote thereon to take effect when such
resignation or resignations shall become effective, and each
director so chosen shall hold office for the unexpired portion of
the term of the director whose place shall be vacated and until his
successor shall have been duly elected and qualified.
Section 20. Removal. Subject to the Articles of
Incorporation, any director may be removed by:
(a) the affirmative vote of the holders of a majority of the
outstanding shares of the Corporation then entitled to vote, with
or without cause; or
(b) the affirmative and unanimous vote of a majority of the
directors of the Corporation, with the exception of the vote of the
directors to be removed, with or without cause.
Section 21. Meetings.
(a) Annual Meetings. The annual meeting of the Board of
Directors shall be held immediately after the annual meeting of
stockholders and at the place where such meeting is held. No
notice of an annual meeting of the Board of Directors shall be
necessary and such meeting shall be held for the purpose of
electing officers and transacting such other business as may
lawfully come before it.
(b) Regular Meetings. Except as hereinafter otherwise
provided, regular meetings of the Board of Directors shall be held
in the office of the corporation required to be maintained pursuant
to Section 2 hereof. Unless otherwise restricted by the Articles
of Incorporation, regular meetings of the Board of Directors may
also be held at any place within or without the state of Nevada
which has been designated by resolution of the Board of Directors
or the written consent of all directors.
(c) Special Meetings. Unless otherwise restricted by the
Articles of Incorporation, special meetings of the Board of
Directors may be held at any time and place within or without the
State of Nevada whenever called by the Chairman of the Board, the
President or any two of the directors.
(d) Telephone Meetings. Any member of the Board of
Directors, or of any committee thereof, may participate in a
meeting by means of conference telephone or similar communications
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equipment by means of which all persons participating in the
meeting can hear each other, and participation in a meeting by such
means shall constitute presence in person at such meeting.
(e) Notice of Meetings. Notice of the time and place of all
special meetings of the Board of Directors shall be orally or in
writing, by telephone, facsimile, telegraph or telex, during normal
business hours, at least twenty-four (24) hours before the date and
time of the meeting, or sent in writing to each director by first
class mail, charges prepaid, at least three (3) days before the
date of the meeting. Notice of any meeting may be waived in
writing at any time before or after the meeting and will be waived
by any director by attendance thereat, except when the director
attends the meeting for the express purpose of objecting, at the
beginning of the meeting, to the transaction of any business
because the meeting is not lawfully called or convened.
(f) Waiver of Notice. The transaction of all business at any
meeting of the Board of Directors, or any committee thereof,
however called or noticed, or wherever held, shall be as valid as
though had at a meeting duly held after regular call and notice, if
a quorum be present and if, either before or after the meeting,
each of the directors not present shall sign a written waiver of
notice. All such waivers shall be filed with the corporate records
or made a part of the minutes of the meeting.
Section 22. Quorum and Voting.
(a) Unless the Articles of Incorporation requires a greater
number and except with respect to indemnification questions arising
under Section 43 hereof, for which a quorum shall be one-third of
the exact number of directors fixed from time to time in accordance
with the Articles of Incorporation, a quorum of the Board of
Directors shall consist of a majority of the exact number of
directors fixed from time to time by the Board of Directors in
accordance with the Articles of Incorporation provided, however, at
any meeting whether a quorum be present or otherwise, a majority of
the directors present may adjourn from time to time until the time
fixed for the next regular meeting of the Board of Directors,
without notice other than by announcement at the meeting.
(b) At each meeting of the Board of Directors at which a
quorum is present, all questions and business shall be determined
by the affirmative vote of a majority of the directors present,
unless a different vote be required by law, the Articles of
Incorporation or these Bylaws.
Section 23. Action Without Meeting. Unless otherwise
restricted by the Articles of Incorporation or these Bylaws, any
action required or permitted to be taken at any meeting of the
Board of Directors or of any committee thereof may be taken without
a meeting, if all members of the Board of Directors or committee,
as the case may be, consent thereto in writing, and such writing or
writings are filed with the minutes of proceedings of the Board of
Directors or committee.
Section 24. Fees and Compensation. Directors shall be
entitled to such compensation for their services as may be approved
by the Board of Directors, including, if so approved, by resolution
of the Board of Directors, a fixed sum and expenses of attendance,
if any, for attendance at each regular or special meeting of the
Board of Directors and at any meeting of a committee of
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the Board of Directors. Nothing herein contained shall be construed to
preclude any director from serving the corporation in any other
capacity as an officer, agent, employee, or otherwise and receiving
compensation therefor.
Section 25. Committees.
(a) Executive Committee. The Board of Directors may by
resolution passed by a majority of the whole Board of Directors
appoint an Executive Committee to consist of one (1) or more
members of the Board of Directors. The Executive Committee, to the
extent permitted by law and provided in the resolution of the Board
of Directors shall have and may exercise all the powers and
authority of the Board of Directors in the management of the
business and affairs of the corporation, including without
limitation the power or authority to declare a dividend, to
authorize the issuance of stock and to adopt a certificate of
ownership and merger, and may authorize the seal of the corporation
to be affixed to all papers which may require it; but no such
committee shall have the power or authority in reference to
amending the Articles of Incorporation (except that a committee
may, to the extent authorized in the resolution or resolutions
providing for the issuance of shares of stock adopted by the Board
of Directors fix the designations and any of the preferences or
rights of such shares relating to dividends, redemption,
dissolution, any distribution of assets of the corporation or the
conversion into, or the exchange of such shares for, shares of any
other class or classes or any other series of the same or any other
class or classes of stock of the corporation or fix the number of
shares of any series of stock or authorize the increase or decrease
of the shares of any series), adopting an agreement of merger or
consolidation, recommending to the stockholders the sale, lease or
exchange of all or substantially all of the corporation's property
and assets, recommending to the stockholders a dissolution of the
corporation or a revocation of a dissolution, or amending the
bylaws of the corporation.
(b) Other Committees. The Board of Directors may, by
resolution passed by a majority of the whole Board of Directors,
from time to time appoint such other committees as may be permitted
by law. Such other committees appointed by the Board of Directors
shall consist of one (1) or more members of the Board of Directors
and shall have such powers and perform such duties as may be
prescribed by the resolution or resolutions creating such
committees, but in no event shall such committee have the powers
denied to the Executive Committee in these Bylaws.
(c) Term. Each member of a committee of the Board of
Directors shall serve a term on the committee coexistent with such
member's term on the Board of Directors. The Board of Directors,
subject to the provisions of subsections (a) or (b) of this Bylaw
may at any time increase or decrease the number of members of a
committee or terminate the existence of a committee. The
membership of a committee member shall terminate on the date of his
death or voluntary resignation from the committee or from the Board
of Directors. The Board of Directors may at any time for any
reason remove any individual committee member and the Board of
Directors may fill any committee vacancy created by death,
resignation, removal or increase in the number of members of the
committee. The Board of Directors may designate one or more
directors as alternate members of any committee, who may replace
any absent or disqualified member at any meeting of the committee,
and, in addition, in the absence or disqualification of any member
of a committee, the member or members thereof present at any
meeting and not disqualified from voting, whether or not
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he or they constitute a quorum, may unanimously appoint another
member of the Board of Directors to act at the meeting in the
place of any such absent or disqualified member.
(d) Meetings. Unless the Board of Directors shall otherwise
provide, regular meetings of the Executive Committee or any other
committee appointed pursuant to this Section 25 shall be held at
such times and places as are determined by the Board of Directors,
or by any such committee, and when notice thereof has been given to
each member of such committee, no further notice of such regular
meetings need be given thereafter. Special meetings of any such
committee may be held at any place which has been determined from
time to time by such committee, and may be called by any director
who is a member of such committee, upon written notice to the
members of such committee of the time and place of such special
meeting given in the manner provided for the giving of written
notice to members of the Board of Directors of the time and place
of special meetings of the Board of Directors. Notice of any
special meeting of any committee may be waived in writing at any
time before or after the meeting and will be waived by any director
by attendance thereat, except when the director attends such
special meeting for the express purpose of objecting, at the
beginning of the meeting, to the transaction of any business
because the meeting is not lawfully called or convened. A majority
of the authorized number of members of any such committee shall
constitute a quorum for the transaction of business, and the act of
a majority of those present at any meeting at which a quorum is
present shall be the act of such committee.
Section 26. Organization. At every meeting of the
directors, the Chairman of the Board of Directors, or, if a
Chairman has not been appointed or is absent, the President, or if
the President is absent, the most senior Vice President, or, in the
absence of any such officer, a chairman of the meeting chosen by a
majority of the directors present, shall preside over the meeting.
The Secretary, or in his absence, an Assistant Secretary directed
to do so by the President, shall act as secretary of the meeting.
ARTICLE V
OFFICERS
Section 27. Officers Designated. The officers of the
corporation shall include, if and when designated by the Board of
Directors, the Chairman of the Board of Directors, the Chief
Executive Officer, the President, one or more Vice Presidents, the
Secretary, the Chief Financial Officer, the Treasurer, the
Controller, all of whom shall be elected at the annual
organizational meeting of the Board of Direction. The Board of
Directors may also appoint one or more Assistant Secretaries,
Assistant Treasurers, Assistant Controllers and such other officers
and agents with such powers and duties as it shall deem necessary.
The Board of Directors may assign such additional titles to one or
more of the officers as it shall deem appropriate. Any one person
may hold any number of offices of the corporation at any one time
unless specifically prohibited therefrom by law. The salaries and
other compensation of the officers of the corporation shall be
fixed by or in the manner designated by the Board of Directors.
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Section 28. Tenure and Duties of Officers.
(a) General. All officers shall hold office at the pleasure
of the Board of Directors and until their successors shall have
been duly elected and qualified, unless sooner removed. Any
officer elected or appointed by the Board of Directors may be
removed at any time by the Board of Directors. If the office of
any officer becomes vacant for any reason, the vacancy may be
filled by the Board of Directors.
(b) Duties of Chairman of the Board of Directors. The
Chairman of the Board of Directors, when present, shall preside at
all meetings of the stockholders and the Board of Directors. The
Chairman of the Board of Directors shall perform other duties
commonly incident to his office and shall also perform such other
duties and have such other powers as the Board of Directors shall
designate from time to time. If there is no President, then the
Chairman of the Board of Directors shall also serve as the Chief
Executive Officer of the corporation and shall have the powers and
duties prescribed in paragraph (c) of this Section 28.
(c) Duties of President. The President shall preside at all
meetings of the stockholders and at all meetings of the Board of
Directors, unless the Chairman of the Board of Directors has been
appointed and is present. Unless some other officer has been
elected Chief Executive Officer of the corporation, the President
shall be the chief executive officer of the corporation and shall,
subject to the control of the Board of Directors, have general
supervision, direction and control of the business and officers of
the corporation. The President shall perform other duties commonly
incident to his office and shall also perform such other duties and
have such other powers as the Board of Directors shall designate
from time to time.
(d) Duties of Vice Presidents. The Vice Presidents may
assume and perform the duties of the President in the absence or
disability of the President or whenever the office of President is
vacant. The Vice Presidents shall perform other duties commonly
incident to their office and shall also perform such other duties
and have such other powers as the Board of Directors or the
President shall designate from time to time.
(e) Duties of Secretary. The Secretary shall attend all
meetings of the stockholders and of the Board of Directors and
shall record all acts and proceedings thereof in the minute book of
the corporation. The Secretary shall give notice in conformity
with these Bylaws of all meetings of the stockholders and of all
meetings of the Board of Directors and any committee thereof
requiring notice. The Secretary shall perform all other duties
given him in these Bylaws and other duties commonly incident to his
office and shall also perform such other duties and have such other
powers as the Board of Directors shall designate from time to time.
The President may direct any Assistant Secretary to assume and
perform the duties of the Secretary in the absence or disability of
the Secretary, and each Assistant Secretary shall perform other
duties commonly incident to his office and shall also perform such
other duties and have such other powers as the Board of Directors
or the President shall designate from time to time.
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(f) Duties of Chief Financial Officer. The Chief Financial
Officer shall keep or cause to be kept the books of account of the
corporation in a thorough and proper manner and shall render
statements of the financial affairs of the corporation in such form
and as often as required by the Board of Directors or the
President. The Chief Financial Officer, subject to the order of
the Board of Directors, shall have the custody of all funds and
securities of the corporation. The Chief Financial Officer shall
perform other duties commonly incident to his office and shall also
perform such other duties and have such other powers as the Board
of Directors or the President shall designate from time to time.
The President may direct the Treasurer or any Assistant Treasurer,
or the Controller or any Assistant Controller to assume and perform
the duties of the Chief Financial Officer in the absence or
disability of the Chief Financial Officer, and each Treasurer and
Assistant Treasurer and each Controller and Assistant Controller
shall perform other duties commonly incident to his office and
shall also perform such other duties and have such other powers as
the Board of Directors or the President shall designate from time
to time.
Section 29. Delegation of Authority. The Board of
Directors may from time to time delegate the powers or duties of
any officer to any other officer or agent, notwithstanding any
provision hereof.
Section 30. Resignations. Any officer may resign at any
time by giving written notice to the Board of Directors or to the
President or to the Secretary. Any such resignation shall be
effective when received by the person or persons to whom such
notice is given, unless a later time is specified therein, in which
event the resignation shall become effective at such later time.
Unless otherwise specified in such notice, the acceptance of any
such resignation shall not be necessary to make it effective. Any
resignation shall be without prejudice to the rights, if any, of
the corporation under any contract with the resigning officer.
Section 31. Removal. Any officer may be removed from
office at any time, either with or without cause, by the
affirmative vote of a majority of the directors in office at the
time, or by the unanimous written consent of the directors in
office at the time, or by any committee or superior officers upon
whom such power of removal may have been conferred by the Board of
Directors.
ARTICLE VI
EXECUTION OF CORPORATE INSTRUMENTS AND VOTING
OF SECURITIES OWNED BY THE CORPORATION
Section 32. Execution of Corporate Instrument. The Board
of Directors may, in its discretion, determine the method and
designate the signatory officer or officers, or other person or
persons, to execute on behalf of the corporation any corporate
instrument or document, or to sign on behalf of the corporation the
corporate name without limitation, or to enter into contracts on
behalf of the corporation, except where otherwise provided by law
or these Bylaws, and such execution or signature shall be binding
upon the corporation.
Unless otherwise specifically determined by the Board of
Directors or otherwise required by law, promissory notes, deeds of
trust, mortgages and other evidences of indebtedness of the
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corporation, and other corporate instruments or documents requiring
the corporate seal, and certificates of shares of stock owned by
the corporation, shall be executed, signed or endorsed by the
Chairman of the Board of Directors, or the President or any Vice
President, and by the Secretary or Treasurer or any Assistant
Secretary or Assistant Treasurer. All other instruments and
documents requiting the corporate signature, but not requiring the
corporate seal, may be executed as aforesaid or in such other
manner as may be directed by the Board of Directors.
All checks and drafts drawn on banks or other depositaries on
funds to the credit of the corporation or in special accounts of
the corporation shall be signed by such person .or persons as the
Board of Directors shall authorize so to do.
Unless authorized or ratified by the Board of Directors or
within the agency power of an officer, no officer, agent or
employee shall have any power or authority to bind the corporation
by any contract or engagement or to pledge its credit or to render
it liable for any purpose or for any amount.
Section 33. Voting of Securities Owned by the
Corporation. All stock and other securities of other corporations
owned or held by the corporation for itself, or for other parties
in any capacity, shall be voted, and all proxies with respect
thereto shall be executed, by the person authorized so to do by
resolution of the Board of Directors, or, in the absence of such
authorization, by the Chairman of the Board of Directors, the Chief
Executive Officer, the President, or any Vice President.
ARTICLE VII
SHARES OF STOCK
Section 34. Form and Execution of Certificates.
Certificates for the shares of stock of the corporation shall be in
such form as is consistent with the Articles of Incorporation and
applicable law. Every holder of stock in the corporation shall be
entitled to have a certificate signed by or in the name of the
corporation by the Chairman of the Board of Directors, or the
President or any Vice President and by the Treasurer or Assistant
Treasurer or the Secretary or Assistant Secretary, certifying the
number of shares owned by him in the corporation. Any or all of
the signatures on the certificate may be facsimiles. In case any
officer, transfer agent, or registrar who has signed or whose
facsimile signature has been placed upon a certificate shall have
ceased to be such officer, transfer agent, or registrar before such
certificate is issued, it may be issued with the same effect as if
he were such officer, transfer agent, or registrar at the date of
issue. Each certificate shall state upon the face or back thereof,
in full or in summary, all of the powers, designations,
preferences, and rights, and the limitations or restrictions of the
shares authorized to be issued or shall, except as otherwise
required by law, set forth on the face or back a statement that the
corporation will furnish without charge to each stockholder who so
requests the powers, 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. Within a
reasonable time after the issuance or transfer of uncertificated
stock, the corporation shall send to the registered owner thereof
a written notice containing the information required to be
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set forth or stated on certificates pursuant to this section or
otherwise required by law or with respect to this section a
statement that the corporation will furnish without charge to each
stockholder who so requests the powers, 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.
Except as otherwise expressly provided by law, the rights and
obligations of the holders of certificates representing stock of
the same class and series shall be identical.
Section 35. Lost Certificates. A new certificate or
certificates shall be issued in place of any certificate or
certificates theretofore issued by the corporation alleged to have
been lost, stolen, or destroyed, upon the making of an affidavit of
that fact by the person claiming the certificate of stock to be
lost, stolen, or destroyed. The corporation may require, as a
condition precedent to the issuance of a new certificate or
certificates, the owner of such lost, stolen, or destroyed
certificate or certificates, or his legal representative, to
advertise the same in such manner as it shall require or to give
the corporation a surety bond in such form and amount as it may
direct as indemnity against any claim that may be made against the
corporation with respect to the certificate alleged to have been
lost, stolen, or destroyed.
Section 36. Transfers.
(a) Transfers of record of shares of stock of the corporation
shall be made only upon its books by the holders thereof, in person
or by attorney duly authorized, and upon the surrender of a
properly endorsed certificate or certificates for a like number of
shares.
(b) The corporation shall have power to enter into and
perform any agreement with any number of stockholders of any one or
more classes of stock of the corporation to restrict the transfer
of shares of stock of the corporation of any one or more classes
owned by such stockholders in any manner not prohibited by the
General Corporation Law of Nevada.
Section 37. Fixing Record Dates.
(a) In order that the corporation may determine the
stockholders entitled to notice of or to vote at any meeting of
stockholders or any adjournment thereof, the Board of Directors may
fix, in advance, a record date, which record date shall not precede
the date upon which the resolution fixing the record date is
adopted by the Board of Directors, and which record date shall not
be more than sixty (60) nor less than ten (10) days before the date
of such meeting. If no record date is fixed by the Board of
Directors, the record date for determining stockholders entitled to
notice of or to vote at a meeting of stockholders shall be at the
close of business on the day next preceding the day on which notice
is given, or if notice is waived, at the close of business on the
day next preceding the day on which the meeting is held. 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.
(b) In order that the corporation may determine the
stockholders entitled to receive payment of any dividend or other
distribution or allotment of any rights or the stockholders
entitled to exercise any rights in respect of any change,
conversion or exchange of stock, or for the purpose
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of any other lawful action, the Board of Directors may fix, in advance,
a record date, which record date shall not precede the date upon
which the resolution fixing the record date is adopted, and which
record date shall be not more than sixty (60) days prior to such
action. If no record date is filed, the record date for determining
stockholders for any such purpose shall be at the close of business
on the day on which the Board of Directors adopts the resolution
relating thereto.
Section 38. Registered Stockholders. The corporation shall
be entitled to recognize the exclusive right of a person registered
on its books as the owner of shares to receive dividends, and to
vote as such owner, and shall not be bound to recognize any
equitable or other claim to or interest in such share or shares on
the part of any other person whether or not it shall have express
or other notice thereof, except as otherwise provided by the laws
of Nevada.
ARTICLE VIII
OTHER SECURITIES OF THE CORPORATION
Section 39. Execution of Other Securities. All bonds,
debentures and other corporate securities of the corporation, other
than stock certificates (covered in Section 34), may be signed by
the Chairman of the Board of Directors, the President or any Vice
President, or such other person as may be authorized by the Board
of Directors, and the corporate seal impressed thereon or a
facsimile of such seal imprinted thereon and attested by the
signature of the Secretary or an Assistant Secretary, or the Chief
Financial Officer or Treasurer or an Assistant Treasurer; provided,
however, that where any such bond, debenture or other corporate
security shall be authenticated by the manual signature, or where
permissible facsimile signature, of a trustee under an indenture
pursuant to which such bond, debenture or other corporate security
shall be issued, the signatures of the persons signing and
attesting the corporate seal on such bond, debenture or other
corporate security may be the imprinted facsimile of the signatures
of such persons. Interest coupons appertaining to any such bond,
debenture or other corporate security, authenticated by a trustee
as aforesaid, shall be signed by the Treasurer or an Assistant
Treasurer of the corporation or such other person as may be
authorized by the Board of Directors, or bear imprinted thereon the
facsimile signature of such person. In case any officer who shall
have signed or attested any bond, debenture or other corporate
security, or whose facsimile signature shall appear thereon or on
any such interest coupon, shall have ceased to be such officer
before the bond, debenture or other corporate security so signed or
attested shall have been delivered, such bond, debenture or other
corporate security nevertheless may be adopted by the corporation
and issued and delivered as though the person who signed the same
or whose facsimile signature shall have been used thereon had not
ceased to be such officer of the corporation.
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ARTICLE IX
DIVIDENDS
Section 40. Declaration of Dividends. Dividends upon the
capital stock of the corporation, subject to the provisions of the
Articles of Incorporation, if any, may be declared by the Board of
Directors pursuant to law at any regular or special meeting.
Dividends may be paid in cash, in property, or in shares of the
capital stock, subject to the provisions of the Articles of
Incorporation.
Section 41. Dividend Reserve. Before payment of any
dividend, there may be set aside out of any funds of the
corporation available for dividends such sum or sums as the Board
of Directors from time to time, in their absolute discretion, think
proper as a reserve or reserves to meet contingencies, or for
equalizing dividends, or for repairing or maintaining any property
of the corporation, or for such other purpose as the Board of
Directors shall think conducive to the interests of the
corporation, and the Board of Directors may modify or abolish any
such reserve in the manner in which it was created.
ARTICLE X
FISCAL YEAR
Section 42. Fiscal Year. The fiscal year of the corporation
shall be fixed by resolution of the Board of Directors.
ARTICLE XI
INDEMNIFICATION
Section 43. Indemnification of Directors, Executive Officers,
Other Officers, Employees and Other Agents.
(a) Directors Officers. The corporation shall indemnify its
directors and officers to the fullest extent not prohibited by the
Nevada General Corporation Law; provided, however, that the
corporation may modify the extent of such indemnification by
individual contracts with its directors and officers; and,
provided, further, that the corporation shall not be required to
indemnify any director or officer in connection with any proceeding
(or part thereof) initiated by such person unless (i) such
indemnification is expressly required to be made by law, (ii) the
proceeding was authorized by the Board of Directors of the
corporation, (iii) such indemnification is provided by the
corporation, in its sole discretion, pursuant to the powers vested
in the corporation under the Nevada General Corporation Law or (iv)
such indemnification is required to be made under subsection (d).
(b) Employees and Other Agents. The corporation shall have
power to indemnify its employees and other agents as set forth in
the Nevada General Corporation Law.
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(c) Expense. The corporation shall advance to any person who
was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative, by reason
of the fact that he is or was a director or officer, of the
corporation, or is or was serving at the request of the corporation
as a director or executive officer of another corporation,
partnership, joint venture, trust or other enterprise, prior to the
final disposition of the proceeding, promptly following request
therefor, all expenses incurred by any director or officer in
connection with such proceeding upon receipt of an undertaking by
or on behalf of such person to repay said mounts if it should be
determined ultimately that such person is not entitled to be
indemnified under this Bylaw or otherwise.
Notwithstanding the foregoing, unless otherwise determined
pursuant to paragraph (e) of this Bylaw, no advance shall be made
by the corporation to an officer of the corporation (except by
reason of the fact that such officer is or was a director of the
corporation in which event this paragraph shall not apply) in any
action, suit or proceeding, whether civil, criminal, administrative
or investigative, if a determination is reasonably and promptly
made (i) by the Board of Directors by a majority vote of a quorum
consisting of directors who were not parties to the proceeding, or
(ii) if such quorum is not obtainable, or, even if obtainable, a
quorum of disinterested directors so directs, by independent legal
counsel in a written opinion, that the facts known to the decision-
making party at the time such determination is made demonstrate
clearly and convincingly that such person acted in bad faith or in
a manner that such person did not believe to be in or not opposed
to the best interests of the corporation.
(d) Enforcement. Without the necessity of entering into an
express contract, all rights to indemnification and advances to
directors and officers under this Bylaw shall be deemed to be
contractual rights and be effective to the same extent and as if
provided for in a contract between the corporation and the director
or officer. Any right to indemnification or advances granted by
this Bylaw to a director or officer shall be enforceable by or on
behalf of the person holding such right in any court of competent
jurisdiction if (i) the claim for indemnification or advances is
denied, in whole or in part, or (ii) no disposition of such claim
is made within ninety (90) days of request therefor. The claimant
in such enforcement action, if successful in whole or in part,
shall be entitled to be paid also the expense of prosecuting his
claim. In connection with any claim for indemnification, the
corporation shall be entitled to raise as a defense to any such
action that the claimant has not met the standard of conduct that
make it permissible under the Nevada General Corporation Law for
the corporation to indemnify the claimant for the amount claimed.
In connection with any claim by an officer of the corporation
(except in any action, suit or proceeding, whether civil, criminal,
administrative or investigative, by reason of the fact that such
officer is or was a director of the corporation) for advances, the
corporation shall be entitled to raise a defense as to any such
action clear and convincing evidence that such person acted in bad
faith or in a manner that such person did not believe to be in or
not opposed in the best interests of the corporation, or with
respect to any criminal action or proceeding that such person acted
without reasonable cause to believe that his conduct was lawful.
Neither the failure of the corporation (including its
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Board of Directors, independent legal counsel or its stockholders)
to have made a determination prior to the commencement of such
action that indemnification of the claimant is proper in the
circumstances because he has met the applicable standard of conduct
set forth in the Nevada General Corporation Law, nor an actual
determination by the corporation (including its Board of Directors,
independent legal counsel or its stockholders) that the claimant
has not met such applicable standard of conduct, shall be a defense
to the action or create a presumption that claimant has not met the
applicable standard of conduct. In any suit brought by a director
or officer to enforce a right to indemnification or to an
advancement of expenses hereunder, the burden of proving that the
director or officer is not entitled to be indemnified, or to such
advancement of expenses, under this Article XI or otherwise shall
be on the corporation.
(e) Non-Exclusivity of Rights. The rights conferred on any
person by this Bylaw shall not be exclusive of any other right
which such person may have or hereafter acquire under any statute,
provision of the Articles of Incorporation, Bylaws, agreement, vote
of stockholders or disinterested directors or otherwise, both as to
action in his official capacity and as to action in another
capacity while holding office. The corporation is specifically
authorized to enter into individual contracts with any or all of
its directors, officers, employees or agents respecting
indemnification and advances, to the fullest extent not prohibited
by the Nevada General Corporation Law.
(f) Survival of Rights. The rights conferred on any person
by this Bylaw shall continue as to a person who has ceased to be a
director, officer, employee or other agent and shall inure to the
benefit of the heirs, executors and administrators of such a
person.
(g) Insurance. To the fullest extent permitted by the Nevada
General Corporation Law, the corporation, upon approval by the
Board of Directors, may purchase insurance on behalf of any person
required or permitted to be indemnified pursuant to this Bylaw.
(h) Amendments. Any repeal or modification of this Bylaw
shall only be prospective and shall not affect the rights under
this Bylaw in effect at the time of the alleged occurrence of any
action or omission to act that is the cause of any proceeding
against any agent of the corporation.
(i) Saving Clause. If this Bylaw or any portion hereof shall
be invalidated on any ground by any court of competent
jurisdiction, then the corporation shall nevertheless indemnify
each director and officer to the full extent not prohibited by any
applicable portion of this Bylaw that shall not have been
invalidated, or by any other applicable law.
(j) Certain Definitions. For the purposes of this Bylaw, the
following definitions shall apply:
(i) The term "proceeding" shall be broadly construed and
shall include, without limitation, the investigation,
preparation, prosecution, defense, settlement, arbitration and
appeal of, and the giving of testimony in, any threatened,
pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative.
(ii) The term "expenses" shall be broadly construed and
shall include, without limitation, court costs, attorneys'
fees, witness fees, fines, amounts paid in settlement or
judgment and any other costs and expenses of any nature or
kind incurred in connection with any proceeding.
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(iii) The term the "corporation" shall include, in
addition to the resulting corporation, any constituent
corporation (including any constituent of a constituent)
absorbed in a consolidation or merger which, if its separate
existence had continued, would have had power and authority to
indemnify its directors, officers, and employees or agents, so
that any person who is or was a director, officer, employee or
agent of such constituent corporation, or is or was serving at
the request of such constituent corporation as a director,
officer, employee or agent or another corporation,
partnership, joint venture, trust or other enterprise, shall
stand in the same position under the provisions of this Bylaw
with respect to the resulting or surviving corporation as he
would have with respect to such constituent corporation if its
separate existence had continued.
(iv) References to a "director," "executive officer,"
"officer," "employee," or "agent" of the corporation shall
include, without limitation, situations where such person is
serving at the request of the corporation as, respectively, a
director, executive officer, officer, employee, trustee or
agent of another corporation, partnership, joint venture,
trust or other enterprise.
(v) References to "other enterprises" shall include
employee benefit plans; references to "fines" shall include
any excise taxes assessed on a person with respect to an
employee benefit plan; and references to "serving at the
request of the corporation" shall include any service as a
director, officer, employee or agent of the corporation which
imposes duties on, or involves services by, such director,
officer, employee, or agent with respect to an employee
benefit plan, its participants, or beneficiaries; and a person
who acted in good faith and in a manner he reasonably believed
to be in the interest of the participants and beneficiaries of
an employee benefit plan shall be deemed to have acted in a
manner "not opposed to the best interests of the corporation"
as referred to in this Bylaw.
ARTICLE XII
NOTICES
Section 44. Notices.
(a) Notice to Stockholders. Whenever, under any provisions
of these Bylaws, notice is required to be given to any stockholder,
it shall be given in writing, timely and duly deposited in the
United States mail, postage prepaid, and addressed to his last
known post office address as shown by the stock record of the
corporation or its transfer agent.
(b) Notice to directors. Any notice required to be given to
any director may be given by the method stated in subsection (a),
or by facsimile, telex or telegram, except that such notice other
than one which is delivered personally shall be sent to such
address as such director shall have filed in writing with the
Secretary, or, in the absence of such filing, to the last known
post office address of such director.
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(c) Affidavit of Mailing. An affidavit of mailing, executed
by a duly authorized and competent employee of the corporation or
its transfer agent appointed with respect to the class of stock
affected, specifying the name and address or the names and
addresses of the stockholder or stockholders, or director or
directors, to whom any such notice or notices was or were given,
and the time and method of giving the same, shall in the absence of
fraud, be prima facie evidence of the facts therein contained.
(d) Time Notices Deemed Given. All notices given by mail, as
above provided, shall be deemed to have been given as at the time
of mailing, and all notices given by facsimile, telex or telegram
shall be deemed to have been given as of the sending time recorded
at time of transmission.
(e) Methods of Notice. It shall not be necessary that the
same method of giving notice be employed in respect of all
directors, but one permissible method may be employed in respect of
any one or more, and any other permissible method or methods may be
employed in respect of any other or others.
(f) Failure to Receive Notice. The period or limitation of
time within which any stockholder may exercise any option or right,
or enjoy any privilege or benefit, or be required to act, or within
which any director may exercise any power or right, or enjoy any
privilege, pursuant to any notice sent him ill the manner above
provided, shall not be affected or extended in any manner by the
failure of such stockholder or such director to receive such
notice.
(g) Notice to Person with Whom Communication Is Unlawful.
Whenever notice is required to be given, under any provision of law
or of the Articles of Incorporation or Bylaws of the corporation,
to any person with whom communication is unlawful, the giving of
such notice to such person shall not be require and there shall be
no duty to apply to any governmental authority or agency for a
license or permit to give such notice to such person. Any action
or meeting which shall be taken or held without notice to any such
person with whom communication is unlawful shall have the same
force and effect as if such notice had been duly given. In the
event that the action taken by the corporation is such as to
require the filing of a certificate under any provision of the
Nevada General Corporation Law, the certificate shall state, if
such is the fact and if notice is required, that notice was given
to all persons entitled to receive notice except such persons with
whom communication is unlawful.
(h) Notice to Person with Undeliverable Address. Whenever
notice is required to be given, under any provision of law or the
Articles of Incorporation or Bylaws of the corporation, to any
stockholder to whom (i) notice of two consecutive annual meetings,
and all notices of meetings or of the taking of action by written
consent without a meeting to such person during the period between
such two consecutive annual meetings, or (ii) all, and at least
two, payments (if sent by first class mail) of dividends or
interest on securities during a twelve-month period, have been
mailed addressed to such person at his address as shown on the
records of the corporation and have been returned undeliverable,
the giving of such notice to such person shall not be required.
Any action or meeting which shall be taken or held without notice
to such person shall have the same force and effect as if such
notice had been duly given. If any such person shall deliver to
the corporation a written notice setting forth his then current
address, the requirement that notice be given to such
20
<Page 81>
person shall be reinstated. In the event that the action taken
by the corporation is such as to require the filing of a certificate
under any provision of the Nevada General Corporation Law, the
certificate need not state that notice was not given to persons to
whom notice was not required to be given pursuant to this
paragraph.
ARTICLE XII
AMENDMENTS
Section 45. Amendments.
The Board of Directors shall also have the power to adopt,
amend, or repeal Bylaws as set forth in the Articles of
Incorporation.
ARTICLE XIV
LOANS TO OFFICERS
Section 46. Loans to Officers. The corporation may lend
money to, or guarantee any obligation of, or otherwise assist any
officer or other employee of the corporation or of its
subsidiaries, including any officer or employee who is a Director
of the corporation or its subsidiaries, whenever, in the judgment
of the Board of Directors, such loan, guarantee or assistance may
reasonably be expected to benefit the corporation. The loan,
guarantee or other assistance may be with or without interest and
may be unsecured, or secured in such manner as the Board of
Directors shall approve, including, without limitation, a pledge of
shares of stock of the corporation. Nothing in these Bylaws shall
be deemed to deny, limit or restrict the powers of guaranty or
warranty of the corporation at common law or under any statute.
Declared as the By-Laws of WorldBid Corporation, as amended, as of
the 21st day of June, 1999.
\s\ Howard Thomson
Signature of Officer: ________________________
Name of Officer: HOWARD THOMSON
Position of Officer: SECRETARY & TREASURER
21
<Page 82>
WORLDBID CORPORATION
A Nevada Corporation
- -------------------------------------------------------------------
February 2, 1999
DATABOAT INTERNATIONAL LIMITED
1917 West 4th Avenue, Suite 23
Vancouver, British Columbia
Canada V6J 1M7
Attention: Mr. Scott Wurtele, President
- ---------- ----------------------------
- - and to -
MR. SCOTT WURTELE
1917 West 4th Avenue, Suite 23
Vancouver, British Columbia
Canada V6J 1M7
Dear Sirs:
Re: WORLDBID CORPORATION (the " Company")
- - Offer by the Company to Databoat International Limited
("Databoat") to acquire WorldBid.Com
- -------------------------------------------------------------------
We write to set out the offer of the Company to acquire all of the
assets, technology, property and undertaking comprising the
"WorldBid.Com" internet business carried on by Databoat (the
"Business").
This offer is on the terms and is subject to the conditions set
forth in this letter. If this offer is acceptable, we ask that you
indicate the agreement of Databoat by signing this letter where
indicated below and returning an executed copy to us. This offer
is open for acceptance until 4:00 p.m. (Pacific Time) on February
2, 1999 (the "Expiry Time"), at which time this offer will
terminate unless accepted in writing.
The Company's offer is as follows:
<Page 83>
-2-
1. Offer to Purchase
The Company offers to purchase from Databoat all of the assets,
property and undertaking of the Business as a going concern,
including all of the assets, technology, property and rights
comprising and used in the conduct of the Business (together, the
"Assets") on the terms and subject to the conditions set forth in
this offer. It is agreed that the Assets will include, without
limitation:
(A) all data, source code, object code, drawings, and
software comprising the Business and all copyright,
patents, trademarks, proprietary information, trade
secrets and intellectual property relating to the
Business;
(B) the goodwill of the Business, together with the exclusive
right to the Company to represent itself as carrying on
the Business in continuation of and in succession to
Databoat and the right to use any word indicating that
the Business is so carried on, including the right to use
the name "WorldBid", or any variation thereof as part of
the name of or in connection with the Business or any
part thereof carried on or to be carried on by the
Company;
(C) the "WorldBid.com" internet domain name and the agreement
with InterNIC with respect to the domain name;
(D) the benefit of the agreements between Databoat and its
programmers for the benefit of the Business.
The Company will purchase and Databoat will sell the Business and
the Assets free and clear of all mortgages, liens, charges,
security interests and encumbrances of every kind and nature
whatsoever.
The Company acknowledges and agrees that the assets of Databoat
comprising the Databoat and Vacation Life internet businesses
developed and operated by Databoat are not included within the
Assets or the Business.
The Company acknowledges and agrees that the Business is a startup
business and has not produced any revenues as of the date of this
Agreement. The Company acknowledges and agrees that Databoat gives
no representation or warranty or other assurance as to the ability
of the Business to generate revenues or profits.
2. Payment for the Assets
Subject to Section 3, the Company will issue to Databoat 3,000,000
common shares in the capital of the Company (each a "Company
Share") in consideration for the transfer of the Assets by Databoat
to the Company. Databoat and the Company agree that the Company
Shares will be issued at a deemed price based on $0.01 US per share
based on the best estimate of the fair market value of the Assets
and the Business. Databoat and the Company agree that the
consideration will be
<Page 84>
-3-
allocated between the Assets based on the best estimate of the fair
market value of the Assets as of the date of this Agreement, as
determined in good faith by the accountants for Databoat.
Databoat acknowledges and agrees that the Company Shares are being
issued pursuant to available exemptions from the prospectus and
registration requirements of each of the Securities Act (British
Columbia) and the United States Securities Act of 1933. Databoat
agrees to abide by all applicable resale restrictions and hold
periods imposed by such statutes.
All shares certificates representing the Company Shares will be
endorsed with the following legend pursuant to the United States
Securities Act of 1933 and the British Columbia Securities Act:
THE SECURITIES OFFERED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 (THE "ACT"), AND ARE
BEING OFFERED AND SOLD ONLY TO ACCREDITED INVESTORS IN
RELIANCE UPON EXEMPTIONS FROM THE REGISTRATION
REQUIREMENTS OF THE ACT. SUCH SECURITIES MAY NOT BE
REOFFERED FOR SALE OR RESOLD OR OTHERWISE TRANSFERRED
UNLESS THEY ARE REGISTERED UNDER THE APPLICABLE
PROVISIONS OF THE ACT OR ARE EXEMPT FROM SUCH
REGISTRATION. THE SECURITIES REPRESENTED BY THIS SHARE
CERTIFICATE ARE SUBJECT TO A HOLD PERIOD AND MAY NOT BE
TRADED IN BRITISH COLUMBIA UNTIL THE EXPIRY OF THE HOLD
PERIOD EXCEPT AS PERMITTED BY THE SECURITIES ACT BRITISH
COLUMBIA) AND THE REGULATIONS MADE UNDER THE ACT.
3. Escrow and Financing
Databoat acknowledges and agrees that the Company Shares will be
held in escrow for a period of one year on the terms and conditions
of the escrow agreement attached hereto as Schedule A. The Company
Shares will be released to Databoat in accordance with the escrow
agreement (the "Escrow Agreement"), commencing on the date which is
one year from the date of Closing. In the event that the Company
determines prior to the date which is one year from the date of
Closing not to pursue development and commercialization of the
Business, the Company will have the option to cause Databoat to
deliver all of the Company Shares to the Company for cancellation.
In the event that the Company exercises its right to cause the
Company Shares to be delivered to the Company in accordance with
the terms and conditions of the Escrow Agreement, Databoat will
have the right to acquire the Business and Assets, including any
improvements to the Business and the Assets, from the Company for
a purchase price of $10.00. In the event of delivery of the
Company Shares to the Company pursuant to the Escrow Agreement and
exercise by Databoat of its option to acquire the Business and the
Assets, each of the Company and Databoat will have no further
liability or obligation to the other.
<Page 85>
-4-
Databoat acknowledges that the Company will issue prior to or on
the Closing Date a total of 2,700,000 common shares pursuant to
Rule 504 of Regulation D promulgated pursuant to the United States
Securities Act of 1933 (the "Act") in consideration for the
following payments:
Shares Consideration
- ------ -------------
2,000,000 shares $0.01 US per share
700,000 shares $0.20 US per share
Databoat acknowledges and agrees that the Company will apply the
proceeds of $140,000 realized from the offering of 700,000 shares
at $0.20 per share (the "Private Placement")as follows:
(A) to apply $50,000 US to the development and
commercialization of the Business;
(B) to apply approximately $50,000 US to the payment of
outstanding indebtedness of the Company; and
(C) to apply the balance to expenses of the offerings, to
working capital and for general corporate purposes of the
Company; and
Databoat will consent to the issue of 300,000 common shares of the
Company for proceeds of not less than $300,000, provided Databoat
acknowledges and agrees that the Company will have no obligation to
complete any financings other than the Private Placement.
The Company will create a bank account on Closing to be used as the
operating account for the Business (the "Operating Account").
Wurtele will be the sole authorized signatory on the Operating
Account. The $50,000 US portion of the Private Placement to be
used to develop and commercialize the Business will be deposited
into the Operating Account. Wurtele will ensure that the funds in
the Operating Account are applied to the Business in accordance
with the business plan delivered by Databoat to the Company, except
for material deviations approved by the directors. Wurtele will
report to the board of directors for all expenditures incurred in
the development and commercialization of the Business.
Databoat and Wurtele acknowledge and agree that funds from any
additional financing will not be available for the Business until
such time as the board of directors approve the application of any
portion of the net proceeds of the financing to the development and
commercialization of the Business. The Company will open a bank
account on Closing to be used for the deposit of funds raised by
financings and for the payment of general corporate expenses of the
Company (the "Financing Account"). The signatories of the
Financing Account will be as directed by a majority of the board of
directors of the Company.
<Page 86>
-5-
In the event that, during the one year period commencing on the
Closing Date, the Company does not advance to the Business
sufficient funds for the Company to complete the expenditures set
forth in the Company's business plan, as attached hereto or in any
revised business plan approved by the board of directors of the
Company, then Databoat will be entitled to deliver notice to the
Company demanding that the Company advance to the Business
sufficient funds to enable the Company to meet the objectives of
the business plan (a "Demand Notice"). Upon receipt of a Demand
Notice, the Company will have a period of thirty (30) days in which
to provide the required funding to bring the Company current with
the expenditures required under the business plan.
In the event that, during the one year period commencing on the
Closing Date, the Company elects not to or fails to provide the
necessary funding to the Business or in the event Wurtele
terminates the Management Consulting Agreement, as defined below,
pursuant to Section 6.3 of the Management Consulting Agreement,
Databoat will have the option to put the Company Shares to the
Company in exchange for the transfer by the Company to Databoat of
the Business. On closing, the Company will execute and deliver
into escrow an executed general conveyance of business as required
to give effect to the transfer of the Business to Databoat upon
exercise of its option. In the event of the exercise by Databoat
of its option and the transfer of the Business to Databoat, the
Company Shares will be released to the Company and each of the
Company, Wurtele and Databoat will have no further liability or
obligation to the other.
In the event that the shares of the Company or any successor are
not listed or quoted for trading on any public trading market,
including Nasdaq Small Cap Market, the OTC Bulletin Board or an
electronic quotation service, within the date which is eighteen
months from the Closing Date, then Databoat will have the right to
purchase the Business from the Company in consideration for the
transfer of the Company Shares to the Company. Databoat must give
notice of its election within 30 days of the date which is eighteen
months from the Closing Date. Upon receipt of notice of election,
the Company will execute and deliver an executed general conveyance
of business assets to Databoat upon presentation of the Company
Shares released from escrow. Each party will give joint
instruction to the escrow agent as required to deliver the balance
of the Company Shares to the Company.
4. Closing Date
The date of the closing of the purchase and sale of the Assets will
be the 15th day of February, 1999 (the "Closing Date").
5. Management Agreement
In order to enable WorldBid to develop and commercialize the
Business, Wurtele will enter into the management consulting
agreement with WorldBid in the form attached hereto as Schedule B
(the "Management Consulting Agreement") on closing. Databoat
consents to the execution of the Management Consulting Agreement
and the provision of the consulting services pursuant to the
Management Consulting Agreement by Wurtele. Databoat agrees that
the consultant fee payable
<Page 87>
-6-
pursuant to the Management Consulting Agreement will include
reimbursement for all home office expenses of Wurtele and Databoat,
including use of existing office supplies equipment and facilities
presently owned by Wurtele and Databoat, for a maximum of four
months. Databoat will continue to host the "WorldBid.com" Internet
site at no extra cost until such time as the Company enters into a
new server contract for hosting the Business, for a maximum of four
months and provided that the volume of the Business is within the
capacity of the existing NetNation contract.
6. Representations and Warranties
The Company's purchase will be based on the representations and
warranties by Databoat and Scott Wurtele, the principal shareholder
of Databoat, each of which will survive closing, that:
(A) Databoat is a corporation duly organized, validly
existing and in good standing under the British Columbia
Company Act;
(B) Databoat owns, possesses and has good and marketable
title to the Assets free and clear of any and all
mortgages, liens, pledges, charges, security interests,
encumbrances, actions, claims or demands of any nature
whatsoever or howsoever arising;
(C) Databoat is the registered owner of the "WorldBid.com"
URL domain name (the "Domain Name") and has not received
notice from any other party claiming an interest in the
Domain Name or claiming that Databoat has no right to use
the Domain Name;
(D) Databoat has in place the domain name and Internet server
provider agreements necessary for the conduct of the
Business in the manner carried on as of the date of this
Agreement, provided that the "WorldBid.com" internet site
is hosted by NetNation pursuant to a long term contract
between NetNation and Databoat;
(E) No person, firm or corporation has any agreement or
option or any right or privilege (whether by law, pre-
emptive or contractual) capable of becoming an agreement
or option for the purchase of the Assets or any interest
in the Assets;
(F) No other person, firm or corporation owns or has any
legal or beneficial interest in any of the Assets or, to
the knowledge of Databoat and Wurtele, has any rights,
including any moral rights, copyright, trademark or any
other intellectual property rights, in any of the Assets;
(G) Databoat does not have any outstanding material
agreements (including employment agreements) contracts or
commitment, whether written or oral, of any nature or
kind whatsoever, with respect to the ownership of the
Assets or the conduct of the
<Page 88>
-7-
Business, except material agreements which are in the ordinary
course of the Business;
(H) Databoat is not in material default or breach of the
InterNIC domain agreement, the NetNation server agreement
or any agreement with its programmers for the Business
and there exists no state of facts which after notice or
lapse of time or both which would constitute such a
default or breach;
(I) with the exception of the claim by Xerox Canada against
Databoat with respect to a leased photocopier, there are
no actions, suits or proceedings pending or threatened
against or affecting Databoat is not aware of any
existing ground on which any such action, suit or
proceeding might be commenced with any reasonable
likelihood of success;
(J) Databoat is the owner all intellectual property,
including tradenames, copyrights and confidential
information, as required to conduct the Business provided
the Company acknowledges that Databoat is not the owner
of any patents or registered trademarks. Databoat is not
aware of any infringement or claimed infringement of the
intellectual property comprising the Assets and used in
connection with the Business by any other person, firm or
corporation;
(K) Databoat has not received any notice from any
governmental authority stating or claiming that Databoat
does not have any governmental licence or permit required
for the conduct of the Business.
7. Representations and Warranties of The Company
The Company represents and warrants to Databoat, which
representations and warranties will survive Closing, that:
(A) the Company is a corporation duly organized, validly
existing and in good standing under the laws of the State
of Nevada;
(B) upon issue, the Company Shares will be fully paid and
non-assessable shares in the capital of the Company and
each Company Share will have the same voting rights as
all other issued and outstanding common shares of the
Company;
(C) the issued and outstanding shares of the Company will not
exceed 2,700,000 common shares immediately prior to the
Closing;
(D) no person has any option, warrant or other right to
acquire any shares of the Company;
<Page 89>
-8-
(E) the Company does not own any assets;
(F) the Company is not party to any agreements, contracts or
commitments;
(G) there are no actions, suits or proceedings pending or
threatened against or affecting the Company and the
Company is not aware of any existing ground on which any
such action, suit or proceeding might be commenced with
any reasonable likelihood of success.
8. Conditions Precedent to Closing
Databoat's obligations to complete the sale of the Assets is
subject to each of the following conditions:
(A) all representations and warranties of the Company will be
true and correct in all material respects on the Closing
Date;
(B) the Company will have made the deliveries contemplated in
this offer on the Closing Date;
(C) the Company will have completed a minimum of $70,000 of
the Private Placement prior to or contemporaneously with
Closing.
Each of the above conditions precedent is for the sole benefit of
Databoat and may be waived by the Databoat. In the event that any
of the above conditions has not been satisfied by the Closing Date,
the Databoat may elect to terminate this Agreement and will have no
further liability to the Company.
The Company's obligation to complete the purchase of the Assets is
subject to each of the following conditions:
(A) all representations and warranties of Databoat and
Wurtele will be true and correct in all material respects
on the Closing Date;
(B) there shall have been no material adverse change to the
Business between the date of acceptance and the Closing
Date;
(C) Databoat and Wurtele will have made the deliveries
contemplated in this offer on the Closing Date;
Each of the above conditions precedent is for the sole benefit of
the Company and may be waived by the Company. In the event that
any of the above conditions has not been satisfied by the Closing
<Page 90>
-9-
Date, the Company may elect to terminate this Agreement and will
have no further liability to Databoat.
9. Closing Deliveries
On the Closing Date, Databoat will deliver to the Company:
(A) a general conveyance of the Assets and all other deeds of
conveyance, bills of sale, transfer and assignments, duly
executed, in form and content satisfactory to the
Company's solicitors, appropriate to effectively vest
good and marketable title to the Assets free and clear of
all encumbrances and immediately registerable in all
places where registration of such instruments is
necessary or desirable duly executed transfers of the
Assets to the Company, duly endorsed for transfer to the
Company;
(B) written confirmation by an officer of Databoat and by
Wurtele, in his personal capacity, as to the truth and
correctness of the representations and warranties of
Databoat and Wurtele as of the Closing Date;
(C) all other corporate resolutions, agreements, assignments,
consents and documentation as deemed necessary by the
Company's solicitors to give effect to the transactions
contemplated by this agreement in accordance with
accepted commercial practice;
(D) duly executed documents of transfer and waivers of moral
rights by any developer or programmer of the Business
reasonably required, in the opinion of the Company's
solicitors, to transfer title to the Assets to the
Company;
(E) the Escrow Agreement duly executed by Databoat;
(F) the Management Consulting Agreement executed by Wurtele;
On the Closing Date, the Company will deliver to Databoat and
Wurtele:
(A) an acknowledgement of acceptance executed by the Company
confirming the Company will deliver the certificates
representing the Company Shares to which Databoat is
entitled to the Escrow Agent to be held pursuant to the
Escrow Agreement. Databoat acknowledges and agrees that
delivery of share certificates will be delayed pending
appointment of the Company's transfer agent;
(B) resolutions of the shareholders of the Company appointing
the directors of the Company as contemplated by this
Agreement;
<Page 91>
-10-
(C) the Escrow Agreement executed by the Company and the
general conveyance of business assets, as contemplated by
the Escrow Agreement, duly executed by the Company;
(D) the Management Consulting Agreement executed by the
Company, together with the initial bonus payment of
$5,000 US contemplated by the Management Consulting
Agreement;
(E) evidence that the Company has advanced the sum of $50,000
US to the operating account of the Company for the
development and commercialization of the Business.
On the Closing Date, the Company will advance to the Company's
operating account the sum of $50,000 US for the development and
commercialization of the Business. Wurtele will be the sole
signatory on the operating account effective as of closing.
10. Appointment of Directors
On completion of the Closing, the directors of the Company will
consist of Logan Anderson and two representatives of the group
providing the financing, as directed by Logan Anderson.
If the Company elects to retain the Business after the expiry of
the one-year period following Closing, the directors of the Company
will consist of Scott Wurtele, Logan Anderson or his nominee, and
one representative appointed by Databoat.
11. Stock Options
Databoat acknowledges and agrees that incentive stock options will
be granted equally on a 50/50 basis between the Company's operating
group, including Scott Wurtele, and between the Company's financing
and administration group, including Logan Anderson and his associates,
in such amounts and on such terms as approved by the board of
directors from time to time.
12. Jurisdiction/Arbitration
This Agreement shall be governed by the laws of the State of
Washington and each party irrevocably attorns to the jurisdiction
of the courts of the State of Washington. Any dispute or claim
arising hereunder shall be settled by arbitration. Any party may
commence arbitration by sending a written notice of arbitration to
the other party. The notice will state the dispute with
particularity. The arbitration hearing shall be commenced thirty
(30) days following the date of delivery of notice of arbitration
by one party to the other, by the American Arbitration Association
("AAA") as arbitrator. The arbitration shall be conducted in
Seattle, Washington in accordance with the commercial arbitration
rules promulgated by AAA, and each party shall retain the right to
cross-examine the opposing party's witnesses, either through legal
counsel, expert witnesses or both. The decision of the arbitrator
shall be final, binding and conclusive on all parties (without any
right of appeal
<Page 92>
-11-
therefrom) and shall not be subject to judicial review. As part of
his decision, the arbitrator may allocate the cost of arbitration,
including fees of attorneys and experts, as he or she deems fair
and equitable in light of all relevant circumstances. Judgment on
the award rendered by the arbitrator may be entered in any court of
competent jurisdiction.
13. Acceptance
If Databoat wishes to accept this offer, Databoat must execute this
offer where indicated below and deliver a copy of the acceptance to
the Company by no later than 4:00 p.m. (Pacific Time) on February
2, 1999. This offer and its acceptance may be executed in
counterparts.
Yours truly,
WORLDBID CORPORATION
Per: \s\ Logan Anderson
------------------
Logan Anderson, President
This offer is accepted and agreed to this 2nd day of February,
1999.
DATABOAT INTERNATIONAL LIMITED
by its authorized signatory:
\s\ Scott Wurtele
- -----------------
________________________________
Scott Wurtele, President
and by
\s\ Scott Wurtele
- -----------------
SCOTT WURTELE
in his personal capacity
<Page 93>
-12-
SCHEDULE A
ESCROW AGREEMENT
<Page 94>
-13-
SCHEDULE B
MANAGEMENT CONSULTING AGREEMENT
<Page 95>
-14-
SCHEDULE C
BUSINESS PLAN EXPENDITURES
Worldbid Budget for the first to third month following closing,
in US dollars:
Programing......................$10,000
Design...........................10,000
Marketing........................30,000
------
Total...........................$50,000
=======
Worldbid Budget for the fourth to twelfth month following
closing, in US dollars:
Programming.....................$40,000
Design...........................20,000
Marketing.......................100,000
Office rent......................60,000
Server...........................10,000
Server co-location................8,000
Miscellaneous....................12,000
-------
Total..........................$250,000
========
<Page 96>
ESCROW AGREEMENT
THIS AGREEMENT is dated for reference the 15h day of February, 1999
BETWEEN:
DATABOAT INTERNATIONAL LIMITED
a company incorporated pursuant to the laws
of the Province of British Columbia
("Databoat")
OF THE FIRST PART
AND:
WORLDBID CORPORATION
a corporation incorporated pursuant to the laws
of the State of Nevada
("WorldBid")
OF THE SECOND PART
AND:
CANE & COMPANY, L.L.C.,
Suite 1200, 101 Convention Centre Drive
Las Vegas, Nevada, USA 89109
(the "Escrow Agent")
OF THE THIRD PART
WHEREAS:
A. Databoat and WorldBid have entered into an agreement
dated the 15th day of January, 1999 pursuant to which WorldBid has
acquired from Databoat the "WorldBid.Com" internet business
developed by Databoat (the "Acquisition Agreement").
B. WorldBid has issued to Databoat 3,000,000 common shares
in the capital of WorldBid (the "Shares") pursuant to the
Acquisition Agreement which are to be held on the terms and
conditions of this Escrow Agreement.
<Page 97>
2
C. Databoat, WorldBid and the Escrow Agent wish to enter
into this Escrow Agreement to set forth their agreement as to the
manner in which the Escrow Agent will hold and release the Shares.
NOW THEREFORE THIS AGREEMENT WITNESSES that, in consideration of
the sum of $1.00 paid by the each party to the other (the receipt
of which is hereby acknowledged), the parties hereby covenant and
agree as follows:
1. Definitions
1.1 In this Agreement, the following terms shall have the
meanings set forth below:
(a) "Acquisition Agreement" means the Agreement between
Databoat and WorldBid dated the 2nd day of February 1999;
(b) "Business" means the "WorldBid.Com" internet business
sold by Databoat to WorldBid pursuant to the Acquisition
Agreement;
(c) "Escrow Documents" means:
(I) the Share Certificates;
(II) the General Conveyance of Business Assets;
(d) "General Conveyance of Business Assets" means an
assignment of all of the assets, property and undertaking
comprising the Business executed by WorldBid in favour of
Databoat;
(e) "Shares" means the 3,000,000 common shares, $0.001 US per
share par value, in the capital of WorldBid in the name
of Databoat.
(f) "Share Certificates means the share certificates in the
name of Databoat representing the Shares, in
denominations of 300,000 Shares, 700,000 Shares,
1,000,000 Shares and 1,000,000 Shares, and stock powers
of attorney duly executed by Databoat as required to
transfer the Shares to WorldBid;
<Page 98>
3
2. Escrow Documents Held in Escrow
2.1 The Escrow Agent confirms receipt of the Escrow Documents
and acknowledges that it holds the Escrow Documents in trust
subject to the terms and conditions of this Agreement.
3. Release of Escrow Documents
3.1 Subject to Section 3.4, upon delivery of a statutory
declaration of an officer of WorldBid prior to February 15, 2000
stating that WorldBid has elected not to proceed with the
development and commercialization of the Business, as contemplated
by the Acquisition Agreement, the Escrow Agent will release the
Share Certificates to WorldBid and the General Conveyance of
Business Assets to Databoat.
3.2 Subject to Section 3.4, upon delivery of a statutory
declaration of an officer of Databoat prior to February 15, 2000
stating that WorldBid has failed to fund the Business in accordance
with the business plan agreed upon by Databoat and WorldBid and
claiming a release of the General Conveyance of Business Assets, as
contemplated in the Acquisition Agreement, the Escrow Agent will
deliver notice of receipt of the statutory declaration to WorldBid.
In the event that the Escrow Agent does not receive any notice of
dispute from WorldBid as to the release of the General Conveyance
of Business Assets to Databoat within 14 days of the date of
delivery of the notice, the Escrow Agent will release the Share
Certificates to WorldBid and the General Conveyance of Business
Assets to Databoat.
3.3 Subject to Section 3.4, in the event that WorldBid does
not deliver to the Escrow Agent a statutory declaration of an
officer of WorldBid to the Escrow Agent stating that WorldBid has
elected not to proceed with the development and commercialization
of the Business prior February 15, 2000, then the Escrow Agreement
will release the General Conveyance of Business Assets to WorldBid
on February 15, 2000 and will release the Share Certificates to
Databoat on the following schedule:
Date of Release Escrow Documents to be Released
- --------------- -------------------------------
February 15, 2000 Share Certificates representing
300,000 Shares, with corresponding
stock power of attorney
February 15, 2001 Share Certificates representing
700,000 Shares, with corresponding
stock power of attorney
February 15, 2002 Share Certificates representing
1,000,000 Shares, with corresponding
stock power of attorney
February 15, 2003 Share Certificates representing
1,000,000 Shares, with corresponding
stock power of attorney
<Page 99>
4
3.4 In the event that the Escrow Agent is given written
notice of any disagreement between Databoat and WorldBid resulting
in adverse claims or demands being made in connection with the
Escrow Documents or a disagreement as to the Escrow Documents to be
released by the Escrow Agent, the Escrow Agent will not release the
Escrow Documents until:
(a) the rights of all parties shall have been fully and
finally adjudicated by an arbitrator or court of
competent jurisdiction; or
(b) Databoat and WorldBid give the Escrow Agent written
notice as to their agreement as to the release of the
Escrow Documents.
4. Scope of Escrow Agent's Duties
4.1 In exercising its duties and obligations as set forth in
this Agreement, the Escrow Agent will act in good faith and with
impartiality towards each of Databoat and WorldBid.
4.2 The Escrow Agent will have no duties or obligations in
respect of the Escrow Documents other than those specifically set
forth herein.
4.3 The Escrow Agent will not be bound in any way by any
other contract or agreement between the parties hereto whether or
not the Escrow Agent has knowledge thereof or of its terms and
conditions and the Escrow Agent's only duty, liability and
responsibility shall be to hold and deal with the Escrow Documents
in accordance with this Agreement.
4.4 The Escrow Agent will be entitled, unless it has
knowledge to the contrary, to assume that any notice and evidence
received pursuant to these instructions from either Databoat or
WorldBid has been duly executed by the party by whom it purports to
have been signed and the Escrow Agent will not be obligated to
enquire into the sufficiency or authority of any signatures
appearing on such notice or evidence.
5. Indemnity
5.1 Databoat and WorldBid covenant and agree to indemnify the
Escrow Agent against loss, liability or expense incurred without
negligence or bad faith on the part of the Escrow Agent arising out
of or in connection with the administration of the Escrow Agent's
duties hereunder, including the costs and expenses of defending
itself against any claim or liability arising therefrom. Databoat
and WorldBid agree to jointly and severally pay to the Escrow Agent
at the Escrow Agent's standard hourly rates for the provision of
legal services in consideration for the Escrow Agent fulfilling its
duties and acting in accordance with its obligations pursuant to
this Escrow Agreement.
6. Notices
<Page 100>
5
6.1 Any notice, statement, demand or request herein required
or permitted or required to be given by any party hereto to the
other shall be in writing and shall be deemed to have been
sufficiently and effectually given if signed by or on behalf of the
party giving the notice and delivered by hand or telecopied, with
original to follow concurrently by mail) to:
Databoat: Copy to:
DATABOAT INTERNATIONAL LIMITED GARY DUNN
6177 Eagle Road, Unit 122 Barrister & Solicitor
Whistler, British Columbia 610 - 1665 West Broadway
Canada V0N 1B0 Vancouver, British Columbia
Attention: Mr. Scott Wurtele Canada, V6J 1X1
Facsimile: (604) 608-3134 Facsimile: (604) 739-7013
WorldBid: Copy to:
WORLDBID CORPORATION O'NEILL & COMPANY
6955 E. Caballo Drive Suite 1880, Royal Centre
Paradise Valley, Arizona 1055 West Georgia Street,
Box 11122
USA 85253 Vancouver, British Columbia
Canada V6E 3P3
Attention: Mr. Logan B. Anderson Attention: Mr. Michael H.
Taylor
Facsimile: (602) 483-3586 Facsimile: (604) 687-6650
<Page 101>
6
Escrow Agent:
Cane & Company, L.L.C.
Suite 1200, 101 Convention Centre Drive
Las Vegas, Nevada
USA 89109
Attention: Mr. Michael A. Cane
Facsimile: (702) 312-6249
Any notice telecopied shall be deemed to be received when
sent and duly received during normal business hours at the office
set forth above. Any notice delivered by hand shall be deemed to
be received when left during normal business hours at the office
set forth above. Any party referred to above shall be entitled to
change its address or telecopier number for notice to an address or
telecopier number elsewhere, by notice in writing to the other
parties.
7. Miscellaneous
7.1 The terms of this Agreement are irrevocable by Databoat,
WorldBid and the Escrow Agent unless such revocation is consented
to in writing by each party.
7.2 The terms herein shall be binding upon the Escrow Agent
and its successors in the practice of law and upon Databoat,
WorldBid and the Escrow Agent and their respective heirs,
executors, administrators, successors and assigns.
7.3 Any dispute or claim arising hereunder shall be settled
by arbitration. Any party may commence arbitration by sending a
written notice of arbitration to the other party. The notice will
state the dispute with particularity. The arbitration hearing
shall be commenced thirty (30) days following the date of delivery
of notice of arbitration by one party to the other, by the American
Arbitration Association ("AAA") as arbitrator. The arbitration
shall be conducted in Seattle, Washington in accordance with the
commercial arbitration rules promulgated by AAA, and each party
shall retain the right to cross-examine the opposing party's
witnesses, either through legal counsel, expert witnesses or both.
The decision of the arbitrator shall be final, binding and
conclusive on all parties (without any right of appeal therefrom)
and shall not be subject to judicial review. As part of his
decision, the arbitrator may allocate the cost of arbitration,
including fees of attorneys and experts, as he or she deems fair
and equitable in light of all relevant circumstances. Judgment on
the award rendered by the arbitrator may be entered in any court of
competent jurisdiction.
<Page 102>
7
7.4 This Agreement shall be governed by the laws of the State
of Washington and each party irrevocably attorns to the
jurisdiction of the courts of the State of Washington.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date and year first above written.
CANE & COMPANY, L.L.C.
Per: \s\ Michael Cane
------------------
Authorized Signatory
DATABOAT INTERNATIONAL LIMITED
by its authorized signatory:
Per: \s\ Scott Wurtele
------------------
Authorized Signatory
WORLDBID CORPORATION
by its authorized signatory:
Per: \s\ Logan Anderson
------------------
Authorized Signatory
<Page 103>
MANAGEMENT CONSULTING CONTRACT
------------------------------
THIS AGREEMENT is made as of the 15th day of February, 1999.
BETWEEN:
SCOTT WURTELE, of 6117 Eagle Road, Unit 122, Whistler,
British Columbia, Canada
(the "Principal")
OF THE FIRST PART
AND:
ON LINE DESIGNS LTD., of 6117 Eagle Road, Unit 122,
Whistler, British Columbia, Canada
(the "Consultant")
OF THE SECOND PART
AND:
WORLDBID CORPORATION a company incorporated pursuant
to the laws of the State of Nevada
("WorldBid")
OF THE THIRD PART
WHEREAS:
A. WorldBid, Databoat International Limited ("Databoat")
and Wurtele have entered into an acquisition agreement dated as of
2 February 1999 Databoat (the "Acquisition Agreement") whereby
WorldBid acquired the "WorldBid.Com" internet business of Databoat
(the "Business").
B. It is a condition of the Acquisition Agreement that the
parties enter into this Management Consulting Agreement.
NOW THEREFORE THIS AGREEMENT WITNESSES THAT in consideration of the
mutual covenants herein contained, the parties hereto agree as
follows:
<Page 104>
-2-
1. ENGAGEMENT
1.1 Appointment: WorldBid hereby contracts for the
services of the Consultant and Consultant hereby agrees with
WorldBid to perform services for WorldBid in accordance with the
terms and conditions of this Agreement. Wurtele agrees to act as
an employee of the Consultant in order to enable the Consultant to
provide the services. The Consultant shall not use the services of
any other party to provide the services.
1.2 Scope of Duties: The Consultant agrees to perform the
following responsibilities and duties to WorldBid to be provided by
the Consultant to WorldBid as consulting services (the "Consultant
Services"):
(a) the Consultant will manage the "WorldBid.com" internet
business acquired by WorldBid pursuant to the Acquisition
Agreement (the "Business"), provided that the Consultant
acknowledges that meeting with and making presentations
to potential investors of the Company is included with
the scope of management of the Business; and
(b) the Consultant will report directly to board of
directors of WorldBid.
The Consultant acknowledges and agrees that the Consultant Services
will not include the management of financial and corporate affairs
of WorldBid.
WorldBid acknowledges and agrees that the Consultant will devote a
majority of the business time of Scott Wurtele as required for the
provision of the Consulting Services, subject to Wurtele devoting
a portion of his business time to the business of Databoat, as it
is carried on as of the date of this Agreement.
WorldBid acknowledges and agrees that Wurtele will not be obligated
to serve as a director of WorldBid pursuant to this Agreement.
1.3 Best Efforts: The Consultant shall at all times use its
best efforts to advance the Business, and shall faithfully,
industriously, and to the best of its abilities, perform the
responsibilities and duties described above.
1.4 Covenants and Restrictions: The Consultant covenants
and agrees with WorldBid that the Consultant will not engage in any
activities which would bring WorldBid's reputation into disrepute.
1.6 The Consultant and Wurtele will at all times be
independent contractors and shall not at any time be or be deemed
to be an employee of WorldBid .
<Page 105>
-3-
2. TERM
2.1 Initial Term: The initial term of this Agreement shall
be one (1 ) year, commencing on the date of this Agreement, subject
to earlier termination as hereinafter provided.
2.2 Renewal: This Agreement may be renewed for further
terms of such duration and upon such terms and conditions as the
Consultant, Wurtele and WorldBid may mutually agree upon in
writing.
3. PAYMENT FOR CONSULTING SERVICES
3.1 WorldBid shall pay to the Consultant a consultant fee in
consideration for Consulting Services equal to the sum of $5,000 US
per month (the "Consultant Fee"). WorldBid will pay to the
Consultant a bonus of $5,000 US upon execution of this Agreement.
WorldBid will pay to the Consultant an additional bonus of $10,000
US upon the date which is three months from the date of this
Agreement, unless WorldBid has terminated this Agreement pursuant
to Section 6.1 of this Agreement prior to the date which is three
months from the date of this Agreement. In the event that WorldBid
elects to terminate this Agreement pursuant to Section 6.2 prior to
the date which is three months from the date of this Agreement, the
additional bonus of $10,000 will be paid on termination as a
payment of liquidated damages to the Consultant and WorldBid will
have no further liability or obligation to the Consultant.
3.2 The Consulting Fee shall be payable by WorldBid to the
Consultant on the last business day of each month during the term
of this Agreement, provided a pro rata portion of the Consulting
Fee will be paid on February 28, 1999.
3.3 Federal Goods and Services Tax on the Consulting Fee
shall be payable by WorldBid in addition to Consulting Fee, if
required by law.
3.4 The Consultant shall deliver to WorldBid at the end of
each month, a report detailing all activities and services provided
to WorldBid for that month, if requested by WorldBid. WorldBid
will report to the Consultant, as requested by the Consultant, on
the status of all financing activities being carried out by
WorldBid for the funding of the Business
3.5 WorldBid will pay to the Consultant, in addition to the
Consultant Fee, the reasonable travel and promotional expenses and
other specific expenses incurred by the Consultant with the prior
written approval of WorldBid.
4. CONFIDENTIALITY
4.1 Confidential Information and Non-Disclosure. Each of
the Consultant and Wurtele acknowledges and agrees with WorldBid
that all information connected with WorldBid's technology and
business, including without limitation, all information, computer
code, data, inventions,
<Page 106>
-4-
improvements, modifications, developments, technical
manuals, or process-flow manuals, customer information and pricing
information is confidential, and each of the Consultant and Wurtele
covenants and agrees with WorldBid to use his best efforts to
ensure that such information does not become public knowledge and
undertakes not to disclose such information or any part thereof to
any other person except as may be necessary to carry out his rights
and obligations under this Agreement. In event of termination,
obligations with respect to confidential information and non-
disclosure with respect to the operation of the Business will
terminate but the obligations with respect to confidential
information and non-disclosure will continue with respect to the
business and corporate affairs of the Company.
5. ASSIGNMENT OF INVENTIONS
5.1 Any and all inventions, developments and improvements on
which the Consultant or Wurtele may conceive or make, during the
term of this Agreement, relating, or in any way to, pertaining to
or connected to the Business shall be the sole and exclusive
property of WorldBid, and the Consultant and Wurtele will, whenever
requested by WorldBid, execute any and all applications,
assignments and other instruments which WorldBid shall deem
necessary in order to assign and convey to the WorldBid the sole
and exclusive right, title and interest in and to the inventions,
developments or improvements. The obligations referred to in this
paragraph shall continue beyond the termination of this Agreement
with respect to any and all inventions or improvements conceived or
made by the Consultant or Wurtele during the term of this
Agreement.
5.2 All inventions and discoveries relating to the business
of WorldBid and all knowledge and information which the Consultant
or Wurtele may acquire during this engagement shall be held by the
Consultant or Wurtele, as applicable, in trust for the benefit of
WorldBid.
6. TERMINATION
6.1 Termination by WorldBid for Default: WorldBid may
terminate this Agreement at any time in the event of any breach of
any material term of this Agreement, provided that written notice
of default has been delivered to the Consultant and Databoat and
the Consultant and Databoat have failed to remedy the default
within seven days of the date of delivery of notice of default.
The failure of the Consultant to provide the services of Wurtele to
perform the Consulting Services will constitute a breach of a
material term of this Agreement.
6.2 Termination by WorldBid without Cause. This Agreement
will terminate upon the election of WorldBid not to proceed with
the development and commercialization of the Business pursuant to
the Acquisition Agreement.
6.3 Termination by the Consultant for Default: The Consultant
may terminate this Agreement at any time in the event of any breach
of any material term of this Agreement by WorldBid, provided that
written notice of default has been delivered to WorldBid and
WorldBid has failed to remedy the default within seven days of the
date of delivery of notice of default. Any non-
<Page 107>
-5-
payment of the Consulting Fee by WorldBid to the Consultant is
deemed for the purposes of this Section 6.3 to be "material",
without limiting the definition of "material". In the event of
termination of this Agreement by the Consultant pursuant to this
Section 6.3 and the exercise by Databoat of its option pursuant to
the Acquisition Agreement to cause WorldBid to transfer the
Business to Databoat, then WorldBid will have no further liability
or obligation to the Consultant.
7. OTHER PROVISIONS
7.1 Governing Law: This Agreement shall be governed by and
construed in accordance with the laws of the Province of British
Columbia. Any dispute or claim arising hereunder shall be settled
by arbitration. Any party may commence arbitration by sending a
written notice of arbitration to the other party. The notice will
state the dispute with particularity. The arbitration hearing
shall be commenced thirty (30) days following the date of delivery
of notice of arbitration by one party to the other, by the American
Arbitration Association ("AAA") as arbitrator. The arbitration
shall be conducted in Seattle, Washington in accordance with the
commercial arbitration rules promulgated by AAA, and each party
shall retain the right to cross-examine the opposing party's
witnesses, either through legal counsel, expert witnesses or both.
The decision of the arbitrator shall be final, binding and
conclusive on all parties (without any right of appeal therefrom)
and shall not be subject to judicial review. As part of his
decision, the arbitrator may allocate the cost of arbitration,
including fees of attorneys and experts, as he or she deems fair
and equitable in light of all relevant circumstances. Judgment on
the award rendered by the arbitrator may be entered in any court of
competent jurisdiction.
7.2 Notice: Any notice required or permitted to be given
under this Agreement shall be in writing and may be delivered
personally or by telex or telecopier, or by prepaid registered post
addressed to the parties at the above-mentioned addresses or at
such other address of which notice may be given by either of such
parties. Any notice shall be deemed to have been received, if
personally delivered or by telex or telecopier, on the date of
delivery and, if mailed as aforesaid, then on the seventh business
day after and excluding the day of mailing.
7.3 Personal Nature: This Agreement is a contract for
services and may not be assigned in whole or in part by the
Consultant.
7.4 Amendments: This Agreement constitutes the entire
agreement between the parties and may only be amended in writing.
<Page 108>
-6-
7.5 Severability. In the event that any term of this
Agreement that is held to be unlawful or unenforceable is severable
and the remaining terms of the Agreement remain in force and
effect.
IN WITNESS WHEREOF the parties have executed this Agreement as of
the day first above written.
SIGNED, SEALED AND DELIVERED
BY SCOTT WURTELE
in the presence of:
\s\ Gary Dunn \s\ Scott Wurtele
- ---------------------------------- --------------------------
Signature SCOTT WURTELE
Gary Dunn
- ----------------------------------
Name
2882 W. 11th
- ----------------------------------
Address Vancouver, BC.
WORLDBID CORPORATION
by its authorized signatory:
\s\ Logan Anderson
- ----------------------------------
Authorized Signatory
ON LINE DESIGNS LTD.
by its authorized signatory:
\s\ Scott Wurtele
- ----------------------------------
Authorized Signatory
