FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
VIRTUALSELLERS.COM, INC.
(Exact name of Registrant as specified in its charter)
CANADA 36-4205042
(State or other jurisdiction of incorporation or organization) (I.R.S.
Employer identification No.)
120 NORTH LASALLE STREET
SUITE 1000
CHICAGO, ILLINOIS
USA 60602
TELEPHONE: (312) 920-1870
(Address of Principal Executive Offices)
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EMPLOYMENT AGREEMENT
(Full title of the plan)
DR. DENNIS SINCLAIR, PH.D.
PRESIDENT AND DIRECTOR
VIRTUALSELLERS.COM, INC.
120 NORTH LASALLE STREET, SUITE 1000
CHICAGO, ILLINOIS
USA 60602
TELEPHONE: (312) 920-1870, FACSIMILE NO.: )312) 920-1871
With a copy to:
BERNARD PINSKY, CLARK, WILSON
#800 - 885 WEST GEORGIA STREET
VANCOUVER, BRITISH COLUMBIA, CANADA V6C 3H1
TELEPHONE NO.: (604) 643-3153, FACSIMILE NO.: (604) 687-6314
(Name and address of agent for service)
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<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
Proposed Maximum Proposed Maximum
Title of Securities Amount to be Offering Price Aggregate Offering Amount of
to be Registered Registered per Unit Price Registration Fee
- ------------------ ------------ --------------- ------------------ -----------------
<S> <C> <C> <C> <C>
Common Stock 1,000,000 N/A N/A $377.44(1)
<FN>
(1) The Registration Fee is calculated in accordance with Rule 457 under the Securities Act of
1933, as amended, based on the average of the bid and asked prices of the common stock on the National
Association of Securities Dealers Inc.'s Over-the-Counter Bulletin Board as of December 20, 1999.
</TABLE>
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
ITEM 1 PLAN INFORMATION
The documents containing the information specified in Part I of this Form S-8
will be sent or given to the employee as specified by Rule 428(b)(1) promulgated
by the Securities and Exchange Commission under the Securities Act of 1933.
Such documents are not being filed with the Commission, but constitute (along
with the documents incorporated by reference to this Registration Statement
pursuant to Item 3 of Part II hereof), a prospectus that meets the requirements
of Section 10(a) of the Securities Act of 1933.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
VirtualSellers.com, Inc. (the "Registrant") hereby incorporates by reference
into this Registration Statement the following documents, previously filed with
the Commission:
(a) The Registrant's Annual Report on Form 20-F for the fiscal year ended
February 28, 1999; and
(b) The Registrant's Quarterly Report on Form 10-Q for the fiscal period
ended August 30, 1999.
In addition to the foregoing, all documents subsequently filed by the Registrant
pursuant to Sections 13(a), 13(c) and 15(d) of the Securities Exchange Act of
1934, as amended, prior to the filing of a post-effective amendment indicating
that all of the securities offered hereunder have been sold or deregistering all
securities then remaining unsold, shall be deemed to be incorporated by
reference in this Registration Statements and to be part hereof from the date of
filing of such documents. Any statement contained in a document incorporated by
reference in this Registration Statement shall be deemed to be modified or
superseded for purposes of this Registration Statement to the extent that a
statement contained herein or in any subsequently filed document that is also
incorporated by reference herein modifies or supersedes such statement. Any
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Registration Statement.
ITEM 4 DESCRIPTION OF SECURITIES
Not applicable
ITEM 5 INTEREST OF NAMED EXPERTS AND COUNSEL
Not applicable.
ITEM 6 INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Canada Business Corporation Act (the "CBCA") provides as follows with
respect to indemnification of directors and officers:
"Section 124
(1) Indemnification
Except in respect of an action by or on behalf of the corporation or
body corporate to procure a judgment in its favour, a corporation may indemnify
a director or officer of the corporation, a former director or officer of the
corporation or a person who acts or acted at the corporation's request as a
director or officer of a
<PAGE>
body corporate of which the corporation is or was a shareholder or creditor, and
his heirs and legal representatives, against all costs, charges and expenses,
including an amount paid to settle an action or satisfy a judgment, reasonably
incurred by him in respect of any civil, criminal or administrative action or
proceeding to which he is made a party by reason of being or having been a
director or officer of such corporation or body corporate, if
(a) he acted honestly and in good faith with a view to the best
interests of the corporation; and
(b) in the case of a criminal or administrative action or proceeding
that is enforced by a monetary penalty, he had reasonable grounds for believing
that his conduct was lawful.
(2) Indemnification in derivative actions
A corporation may with the approval of a court indemnify a person
referred to in subsection (1) in respect of an action by or on behalf of the
corporation or body corporate to procure a judgment in its favour, to which he
is made a party by reason of being or having been a director or an officer of
the corporation or body corporate, against all costs, charges and expenses
reasonably incurred by him in connection with such action if he fulfils the
conditions set out in paragraphs (1)(a) and (b).
(3) Indemnity as of right
Notwithstanding anything in this section, a person referred to in
subsection (1) is entitled to indemnity from the corporation in respect of all
costs, charges and expenses reasonably incurred by him in connection with the
defence of any civil, criminal or administrative action or proceeding to which
he is made a party by reason of being or having been a director or officer of
the corporation or body corporate, if the person seeking indemnity
(a) was substantially successful on the merits in his defence of the
action or proceeding; and
(b) fulfils the conditions set out in paragraphs (1)(a) and (b).
(4) Directors' and officers' insurance
A corporation may purchase and maintain insurance for the benefit of any
person referred to in subsection (1) against any liability incurred by him
(a) in his capacity as a director or officer of the corporation,
except where the liability relates to his failure to act honestly and in good
faith with a view to the best interests of the corporation; or
<PAGE>
(b) in his capacity as a director or officer of another body corporate
where he acts or acted in that capacity at the corporation's request, except
where the liability relates to his failure to act honestly and in good faith
with a view to the best interests of the body corporate.
(5) Application to court
A corporation or a person referred to in subsection (1) may apply to a
court for an order approving an indemnity under this section and the court may
so order and make any further order it thinks fit.
(6) Notice to Director
An applicant under subsection (5) shall give the Director notice of the
application and the Director is entitled to appear and be heard in person or by
counsel.
(7) Other notice
On an application under subsection (5), the court may order notice to be
given to any interested person and such person is entitled to appear and be
heard in person or by counsel."
Section 8.01 of Part VIII of the By-laws of the Registrant contain provisions to
limit the liability of directors and officers for the acts, receipts, neglects
or defaults of other directors, officers or employees, or for joining in any
receipt or other act for conformity, or for any loss, damage or expense
happening to the Registrant through the insufficiency or deficiency of title of
any property acquired for or on behalf of the Registrant, or for the
insufficiency or deficiency of any security in or upon which any of the moneys
of the Registrant shall be invested, or for any loss or damage arising from the
bankruptcy, insolvency or tortious acts of any person with whom any of the
moneys, securities or effects of the Registrant shall be deposited, or for any
loss occasioned by an error or judgment or oversight on the part of any officer
or director, or for any other loss, damage or misfortune whatever which shall
happen in the execution of the duties of such directors of officers or in
relation thereto; provided that nothing herein shall relieve any director or
officer from the duty to act in accordance with the CBCA or from liability for
any breach thereof.
Section 8.02 of Part VIII of the By-laws of the Registrant contain provisions
entitling the Registrant's directors and officers to indemnification from all
costs, charges, expenses, including any amount paid to settle an action or
satisfy a judgment reasonably incurred by such officer or director with respect
to any civil, criminal or administrative action or proceeding to which such
officer or director is made a party by reason of being or having been an officer
or director of the Registrant, provided that:
(a) such director or officer acted honestly and in good faith with a view to
the best interests of the Registrant; and
(b) in the case of a criminal or administrative action or proceeding that is
enforced by a monetary penalty, such director or officer had reasonable grounds
for believing that his/her conduct was lawful.
<PAGE>
The Registrant has also agreed to indemnify such officers and directors in other
circumstances as the CBCA permits or requires. In addition, the By-Laws of the
Registrant allow for insurance for the benefit of officers and directors of the
Registrant against such liabilities and in such amounts as the Board may
determine.
Such provisions do not eliminate the personal liability of the Registrant's
directors and officers for monetary damages as a result of a breach of fiduciary
duty or for any actions or omissions which were not done in good faith.
ITEM 7 EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8 EXHIBITS
Number Description
- ------ -----------
4.1 Employment Agreement, dated June 15, 1999, between the Registrant and
Everett Palmer
5.1 Opinion of Clark Wilson, Barristers & Solicitors
23.1 Consents of Clark, Wilson (included in Exhibit 5.1)
ITEM 2. UNDERTAKINGS
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) to reflect in the prospectus any facts or events arising
after the effective date of this Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the registration
statement, notwithstanding the foregoing, any increase or decrease in volume of
securities offered (if the total dollar value of securities offered would not
exceed that which was registered) and any deviation from the low or high end of
the estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration Fee"
table in the effective registration statement; and
<PAGE>
(iii) to include any material information with respect to the plan
of distribution not previously disclosed in the registration statement of any
material change to such information in the registration statement
provided however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if
the registration statement is on Form S-3 or Form S-8, and the information
required to be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed by the Registrant pursuant to Section 13 or
15(d) of the Securities Exchange Act of 1934 that are incorporated by reference
in the Registration Statement.
(2) For the purpose of determining any liability under the Securities Act of
1933, to treat each such post-effective amendment as a new registration
statement of the securities offered, and the offering of the securities at that
time to be the initial bona fide offering.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(b) The Registrant hereby undertakes that, for the purposes of determining
any liability under the Securities Act of 1933, each filing of the Registrant's
annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act
of 1934 that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers, and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
is the successful defence of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question of whether such indemnification by it is against
public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Vancouver, Province of British Columbia, this 23rd
day of December, 1999.
VIRTUALSELLERS.COM, INC.
By: /s/ Dennis Sinclair
Dennis Sinclair, Ph.D.
President and Director
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the following persons in the capacities and on the
dates indicated.
SIGNATURE TITLE DATE
/s/ Raymond Mol
Raymond Mol Director December 23, 1999
<PAGE>
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION PAGE
- ----------- ----------- ----
Number Description
- ------ -----------
4.1 Employment Agreement, dated June 15, 1999, between the Registrant and
Everett Palmer;
5.1 Opinion of Clark, Wilson
23.1 Consent of Clark, Wilson (included in Exhibit 5.1)
EMPLOYMENT AGREEMENT
THIS AGREEMENT effective as of the 15th day of June, 1999 (the "Effective
Date").
BETWEEN:
VIRTUALSELLERS.COM, INC., a company duly incorporated pursuant to the federal
laws of Canada having an office at 120 North LaSalle Street, Suite 1000,
Chicago, Illinois, USA, 60602
(the "Company")
OF THE FIRST PART
AND:
EVERETT PALMER, businessman of 4521 PGA Blvd., Apt. 333, Palm Beach Gardens,
Florida, USA, 33418
(the "Employee")
OF THE SECOND PART
WITNESSES THAT WHEREAS:
I. The Company is a publicly traded company and is engaged in, inter
alia, the business of e-commerce and telecommunications;
II. The Employee has certain skills and expertise required by the
Company for its operations;
III. The Company wishes to obtain and the Employee wishes to provide
certain services to the Company on the terms and conditions contained herein;
NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
covenants set forth below, the parties hereto agree as follows:
1. DUTIES AND DEVOTION OF TIME
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1.1 Duties. During the term of this Agreement the Employee shall be
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responsible for the duties contained in Schedule "A" attached hereto and
incorporated herein by this reference (the "Duties").
1.2 Devotion of Time. The parties hereto acknowledge and agree that
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the work of the Employee is and shall be of such a nature that regular hours may
not be sufficient and occasions may arise whereby the Employee shall be required
to work more than eight (8) hours per day and/or five (5) days per week. The
Employee agrees that the consideration set forth
<PAGE>
herein shall be in full and complete satisfaction for such work and services,
regardless of when and where such work and services are performed. The Employee
further releases the Company from any claims for overtime pay or other such
compensation which may accrue to the Employee. Notwithstanding the foregoing,
the Company agrees that so long as the Employee properly discharges his duties
hereunder, the Employee may devote the remainder of his time and attention to
other non-competing business pursuits.
1.3 Business Opportunities the Property of the Company. The Employee
----------------------------------------------------
agrees to communicate immediately to the Company all business opportunities,
inventions and improvements in the nature of the Company's business which,
during the term of this Agreement, the Employee may conceive, make or discover,
become aware of, directly or indirectly, or have presented to him in any manner
which relates in any way to the Company, either as it is now or as it may
develop, and such business opportunities, inventions or improvements shall
become the exclusive property of the Company without any obligation on the part
of the Company to make any payments therefor in addition to the salary and
benefits herein described to the Employee.
1.4 No Personal Use. The Employee shall not use any of the work the
-----------------
Employee shall perform for the Company for any personal purposes without first
obtaining the prior written consent of the Company.
2. SALARY, BONUSES AND BENEFITS
-------------------------------
2.1 Salary. In consideration of the Employee providing the services
------
referred to herein, the Company agrees to pay the Employee an annual base salary
(the "Annual Base Salary") of seventy five thousand U.S. dollars ($75,000) less
applicable deductions, payable bi-weekly subject to increase as from time to
time approved by the Board of Directors of the Company.
2.2 Benefits. The Company shall provide, maintain and pay for:
--------
(a) medical insurance for the Employee and his immediate family as is
provided by the Company's medical services plan; and
(b) such extended health and other benefits for the Employee and his
immediate family as are provided to senior management employees of the Company,
subject to the eligibility of the Employee.
2.3 Payment in Cash or Shares. All payments payable by the Company to
--------------------------
the Employee, including the Annual Base Salary and reimbursement of expenses
under Section 4.1 hereof, shall be payable in cash or, at the election of the
Employee, and subject to the approval of the regulatory authorities, such will
be paid in whole or in part in common shares in the capital stock of the Company
("Remuneration Shares"), issued at the 10 day average closing price (for the 10
days prior to the Employee's election) of the Company's common shares on any
stock exchange or quotation system upon which the Company's common shares are
listed for trading.
2.4 Compensation Shares . In consideration of the Employee entering
--------------------
into this Agreement and continuing in such employment for a period of at least
one year, the Company
<PAGE>
also agrees to pay the Employee one million (1,000,000) common shares (the
"Compensation Shares") in the capital of the Company. Upon or as soon as is
practical after the issuance of the last tranche of the Compensation Shares, the
Company will file a form S-8 or other appropriate form with the United States
Securities and Exchange Commission (the "SEC") to effect registration. The
Shares shall vest as to 250,000 shares on each of the following dates ("Vesting
Dates"):
(a) the Effective Date - 250,000 shares;
(b) three months after the Effective Date - 250,000 shares;
(c) six months after the Effective Date - 250,000 shares; and
(d) nine months after the Effective Date - 250,000.
The share certificates representing the first 250,000 of the Compensation Shares
will be delivered by the Company to the Employee within ten (10) days of the
execution of this Agreement by the parties. The remaining share certificates
shall be delivered on or immediately after each of the Vesting Dates. If this
Agreement is terminated for any reason, those Shares that have vested in the
Employee at the date of notice of termination shall be deemed to have been
earned by the Employee, no reduction or refund shall take place and no claim for
any additional shares, compensation, severance or consideration of any kind may
be made by the Employee.
2.5 Number of Shares The number of shares payable to the Employee
------------------
hereunder is subject to adjustment from time to time if the Company is subject
to a consolidation, merger or transfer of assets which reclassifies or changes
its outstanding common shares, in which case the successor corporation (or
corporation controlling the successor corporation of the Company, as the case
may be) shall by operation of law assume the Company's obligations under this
Agreement. As a condition to the consummation of such transaction, the Employee
shall arrange for the person or entity obligated to issue securities or deliver
cash or other assets to assume, concurrently with the consummation of such
transaction, the Employee's obligations hereunder by executing an instrument so
providing and further providing for adjustments which shall be as nearly
equivalent as may be practical to the adjustments provided herein.
3. VACATION
--------
3.1 Entitlement to Vacation. The Company acknowledges that the
-------------------------
Employee shall be entitled to an annual vacation of three (3) weeks. The
Employee shall use his best efforts to ensure that such vacation is arranged
with the Company in advance such that his does not unduly affect the operations
of the Company.
3.2 Increase in Vacation. The period set out in Section 3.1 above may
---------------------
be increased from time to time as mutually agreed to by the Employee and the
Board of Directors of the Company.
4. REIMBURSEMENT OF EXPENSES
---------------------------
4.1 Reimbursement of Expenses. The Employee shall be reimbursed for
---------------------------
all reasonable out-of-pocket expenses incurred by the Employee in or about the
execution of the Duties contained herein. All payments and reimbursements shall
be made within thirty (30) days of submission by the Employee of vouchers, bills
or receipts for such expenses.
<PAGE>
5. CONFIDENTIAL INFORMATION
-------------------------
5.1 Confidential Information. The Employee shall not, either during
-------------------------
the term of this Agreement or for a term of three years after termination,
without specific consent in writing, disclose or reveal in any manner whatsoever
to any other person, firm or corporation, nor will it use, directly or
indirectly, for any purpose other than the purposes of the Company, the private
affairs of the Company or any confidential information which he may acquire
during the term of this Agreement with relation to the business and affairs of
the directors and shareholders of the Company, unless the Employee is ordered to
do so by a court of competent jurisdiction or unless required by any statutory
authority.
5.2 Non-Disclosure Provisions. The foregoing provision shall be
--------------------------
subject to the further non-disclosure provisions contained in Schedule "B"
attached hereto and incorporated herein by this reference.
5.3 Provisions Survive Termination. The provisions of this section
--------------------------------
shall survive the termination of this Agreement for a period of three years.
6. TERM
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6.1 Term. This Agreement shall remain in effect until terminated in
----
accordance with any of the provisions contained in this Agreement.
7. TERMINATION
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7.1 Termination by Employee. Notwithstanding any other provision
-------------------------
contained herein, the parties hereto agree that the Employee may terminate this
Agreement, with or without cause, by giving thirty (30) days written notice of
such intention to terminate.
7.2 Resignation or Cessation of Duties. In the event that the Employee
----------------------------------
ceases to perform all of the Duties contained herein, other than by reason of
the Employee's death or disability, or if the Employee resigns unilaterally and
on his own initiative from all of his positions this Agreement shall be deemed
to be terminated by the Employee as of the date of such cessation of Duties or
such resignation, and the Company shall have no further obligations under
Section 2 hereof.
7.3 Termination by Company. The Company may terminate this agreement
------------------------
at any time for just cause. The parties further agree that except for
termination for just cause, the Company may not terminate this Agreement without
payment, at that time, to the Employee of a termination allowance equivalent to
fourteen (14) days in value of the Annual Base Salary payable by the Company to
the Employee, regardless of the date of termination.
7.4 Death. In the event of the death of the Employee during the term
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of this Agreement, this Agreement shall be terminated as of the date of such
death.
<PAGE>
8. RIGHTS AND OBLIGATIONS UPON TERMINATION
-------------------------------------------
8.1 Rights and Obligations. Upon termination of this Agreement, the
------------------------
Employee shall deliver up to the Company all documents, papers, plans, materials
and other property of or relating to the affairs of the Company, other than the
Employee's personal papers in regard to his role in the Company, which may then
be in the Employee's possession or under his control.
9. NOTICES AND REQUESTS
----------------------
9.1 Notices and Requests. All notices and requests in connection with
---------------------
this Agreement shall be deemed given as of the day they are received either by
messenger, delivery service, or mailed by registered or certified mail with
postage prepaid and return receipt requested and addressed as follows:
(a) if to the Company:
VirtualSellers.com, Inc.
120 North LaSalle Street, Suite 1000
Chicago, Illinois, USA, 60602
with a copy to:
CLARK, WILSON
Suite 800-885 West Georgia Street
Vancouver, British Columbia
V6C 3H1
Attention: Bernard Pinsky
(b) If to the Employee:
Everett Palmer
,
, Virginia, USA,
or to such other address as the party to receive notice or request so designates
by written notice to the other.
10. INDEPENDENT PARTIES
--------------------
10.1 Independent Parties. This Agreement is intended solely as a
--------------------
management services agreement and no partnership, agency, joint venture,
distributorship or other form of agreement is intended.
11. AGREEMENT VOLUNTARY AND EQUITABLE
------------------------------------
11.1 Agreement Voluntary. The parties acknowledge and declare that in
--------------------
executing this Agreement they are each relying wholly on their own judgment and
knowledge and have not been influenced to any extent whatsoever by any
representations or statements made by or on behalf of the other party regarding
any matters dealt with herein or incidental thereto.
<PAGE>
11.2 Agreement Equitable. The parties further acknowledge and declare
--------------------
that they each have carefully considered and understand the provisions contained
herein, including, but without limiting the generality of the foregoing, the
Employee's rights upon termination and the restrictions on the Employee after
termination and agree that the said provisions are mutually fair and equitable,
and that they executed this Agreement voluntarily and of their own free will.
12. CONTRACT NON-ASSIGNABLE; INUREMENT
------------------------------------
12.1 Contract Non-Assignable. This Agreement and all other rights,
------------------------
benefits and privileges contained herein may not be assigned by the Employee.
12.2 Inurement. The rights, benefits and privileges contained herein,
---------
including without limitation the benefits of Sections 2 and 7 hereof, shall
inure to the benefit of and be binding upon the respective parties hereto, their
heirs, executors, administrators and successors.
13. ENTIRE AGREEMENT
-----------------
13.1 Entire Agreement. This Agreement represents the entire Agreement
-----------------
between the parties and supersedes any and all prior agreements and
understandings, whether written or oral, between the parties. The Employee
acknowledges that it was not included to enter into this Agreement by any
representation, warranty, promise or other statement, except as contained
herein.
13.2 Previous Agreements Cancelled. Save and except for the express
-------------------------------
provisions of this Agreement, any and all previous agreements, written or oral,
between the parties hereto or on their behalf relating to the services of the
Employee for the Company are hereby terminated and cancelled and each of the
parties hereby releases and further discharges the other of and from all manner
of actions, causes of action, claims and demands whatsoever under or in respect
of any such Agreement.
14. WAIVER
------
14.1 Waiver. No consent or waiver, express or implied, by either party
------
to or of any breach or default by the other party in the performance by the
other of its obligations herein shall be deemed or construed to be a consent or
waiver to or of any breach or default of the same or any other obligation of
such party. Failure on the part of any party to complain of any act or failure
to act, or to declare either party in default irrespective of how long such
failure continues, shall not constitute a waiver by such party of its rights
herein or of the right to then or subsequently declare a default.
15. SEVERABILITY
------------
15.1 Severability. If any provision contained herein is determined to
------------
be void or unenforceable in whole or in part, it is to that extent deemed
omitted. The remaining provisions shall not be affected in any way.
<PAGE>
16. AMENDMENT
---------
16.1 Amendment. This Agreement shall not be amended or otherwise
---------
modified except by a written notice of even date herewith or subsequent hereto
signed by both parties.
17. HEADINGS
--------
17.1 Headings. The headings of the sections and subsections herein are
--------
for convenience only and shall not control or affect the meaning or construction
of any provisions of this Agreement.
18. GOVERNING LAW
--------------
18.1 Governing Law. This Agreement shall be construed under and
--------------
governed by the laws of the State of Illinois and the laws of the United States
applicable therein.
19. EXECUTION
---------
19.1 Execution in Several Counterparts. This Agreement may be executed
---------------------------------
by facsimile and in several counterparts, each of which shall be deemed to be an
original and all of which shall together constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day of, 1999.
VIRTUALSELLERS.COM, INC.
per: /s/ Dennis Sinclair
Authorized Signatory
)
SIGNED, SEALED and DELIVERED by )
in the presence of: )
)
/s/ Kevin Dudley )
Signature )
Kevin E. Dudley )
Print Name )
35 Thistle Ct. )
Address )
Matteson IL 60443 )
) /s/ Everett Palmer
Consultant ) ------------------
Occupation ) EVERETT PALMER
<PAGE>
SCHEDULE "A"
EMPLOYEE'S DUTIES
-----------------
1. The Employee shall be appointed by the Company as the full time
accountant for the Company, and the Employee shall faithfully, honestly and
diligently serve the Company and each of the Company's subsidiaries (if any) in
these capacities.
<PAGE>
SCHEDULE "B"
NON-DISCLOSURE PROVISIONS
-------------------------
1. CONFIDENTIAL INFORMATION AND MATERIALS
-----------------------------------------
(a) "Confidential Information" shall mean, for the purposes of this
Agreement, non-public information which the Company designates as being
confidential or which, under the circumstances surrounding disclosure ought
reasonably to be treated as confidential. Confidential Information includes,
without limitation, information, whether written, oral or communicated by any
other means, relating to released or unreleased Company software or hardware
products, the marketing or promotion of any product of the Company or the
Company business policies or practices, and information received from others
which the Company is obliged to treat as confidential. Confidential Information
disclosed to the Employee by any subsidiary and/or agents of the Company is
covered by this Agreement.
(b) Confidential Information shall not include that information defined
as Confidential Information hereinabove which the Employee can exclusively
establish:
(i) is or subsequently becomes publicly available without breach of any
obligation of confidentiality owed by the Company;
(ii) became known to the Employee prior to disclosure by the Company to the
Employee;
(iii) became known to the Employee from a source other than the Company
other than by the breach of any obligations of confidentiality owed to the
Company; or
(iv) is independently developed by the Employee.
(c) Confidential Materials shall include all tangible materials
containing Confidential Information, including, without limitation, written or
printed documents and computer disks or tapes, whether machine or user readable.
2. RESTRICTIONS
------------
(a) The Employee shall not disclose any Confidential Information to
third parties for a period of three (3) years following the termination of this
Agreement, except as provided herein. However, the Employee may disclose
Confidential Information during bona fide execution of the Duties or in
accordance with judicial or other governmental order, provided that the Employee
shall give reasonable notice to the Company prior to such disclosure and shall
comply with any applicable protective order or equivalent.
(b) The Employee shall take reasonable security precautions, at least
as great as the precautions it takes to protect its own confidential
information, to keep confidential the Confidential Information, as defined
hereinabove.
<PAGE>
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D/SAM/48915.1
D/SAM/48915.1
(c) Confidential Information and Materials may be disclosed,
reproduced, summarized or distributed only in pursuance of the business
relationship of the Employee with the Company, and only as provided hereunder.
3. RIGHTS AND REMEDIES
---------------------
(a) The Employee shall notify the Company immediately upon discovery of
any unauthorized use or disclosure of Confidential Information or Materials, or
any other breach of this Agreement by the Employee, and shall co-operate with
the Company in every reasonable manner to aid the Company to regain possession
of said Confidential Information or Materials and prevent all such further
unauthorized use.
(b) The Employee shall return all originals, copies, reproductions and
summaries of or relating to the Confidential Information at the request of the
Company or, at the option of the Company, certify destruction of the same.
(c) The parties hereto recognize that a breach by the Employee of any
of the provisions contained herein would result in damages to the Company and
that it could not be compensated adequately for such damages by monetary award.
Accordingly, the Employee agrees that in the event of any such breach, in
addition to all other remedies available to the Company at law or in equity, the
Company shall be entitled as a matter of right to apply to a court of competent
jurisdiction for such relief by way of restraining order, injunction, decree or
otherwise, as may be appropriate to ensure compliance with the provisions of
this Agreement.
4. MISCELLANEOUS
-------------
(a) All Confidential Information and Materials are and shall remain the
property of the Company. By disclosing information to the Employee, the Company
do not grant any express or implied right to the Employee to or under any and
all patents, copyrights, trademarks, or trade secret information belonging to
the Company.
(b) All obligations created herein shall survive change or termination
of any and all business relationships between the parties for a period of three
years after such termination.
(c) The Company may from time to time request suggestions, feedback or
other information from the Employee on Confidential Information or on released
or unreleased software belonging to the Company. Any suggestions, feedback or
other disclosures made by the Employee are and shall be entirely voluntary on
the party of said Employee and shall not create any obligations on the part of
the Company or a confidential agreement between the Employee and the Company.
Instead, the Company shall be free to disclose and use any suggestions, feedback
or other information from the Employee as the Company sees fit, entirely without
obligation of any kind whatsoever to the Employee.
CLARK, WILSON
Barristers & Solicitors
Patent & Trade-Mark Agents
HSBC Building, 800 - 885 West Georgia St.,
Vancouver BC V6C 3H1 Canada Tel.:
(604) 687-5700 Fax: (604) 687-6314
Associated with: Eiko Sogo Law Office, Attorneys & Counsellors at Law, Osaka,
Japan. Some lawyers at Clark, Wilson practice through law corporations.
December 23, 1999
VirtualSellers.com, Inc.
120 North LaSalle Street
Chicago, IL 60602
Ladies and Gentlemen:
We are counsel to VirtualSellers.com, Inc. (the "Company"), a Canadian
corporation, and have assisted in the preparation of the Registration Statement
of the Company on Form S-8 (the "Registration Statement") covering 1,000,000
common shares (the "Shares") in the capital of the Company granted or issuable
pursuant an Employment Agreement, dated June 15, 1999 (the "Agreement"), between
the Company and Mr. Everett Palmer.
We have examined originals or copies, certified or otherwise
identified to our satisfaction of the resolutions of the directors of the
Company with respect to the matters herein. We have also examined such statutes
and public and corporate records of the Company, and have considered such
questions of law as we have deemed relevant and necessary as a basis for the
opinion expressed herein. We have for the purposes of this opinion assumed the
genuineness of all signatures examined by us, the authenticity of all documents
and records submitted to us as originals and the conformity to all original
documents of all documents submitted to us as certified, photostatic or
facsimile copies.
Based upon and subject to the foregoing, and subject to the
qualifications hereinafter expressed, we are of the opinion that each Share to
be issued and sold by the Company pursuant to the Registration Statement will
be, when sold and paid for pursuant to the terms of the Agreement, validly
issued, fully paid and non-assessable.
This opinion is being furnished solely in connection with the filing
of the Registration Statement with the Securities and Exchange Commission, and
we hereby consent to the use of this opinion as an exhibit to the Registration
Statement. This consent is not to be construed as an admission that we are a
person whose consent is required to be filed with the Registration Statement
under the provisions of the Securities Act 1933, as amended. This opinion may
not be relied upon, used by or distributed to any person or entity for any other
purpose without our prior written consent.
Yours truly,
CLARK, WILSON
Per: /s/ Clark, Wilson
(included in Exhibit 5.1)
