Item 1.01
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Entry into Material Definitive Agreement
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Item 3.02
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Unregistered Sales of Equity Securities.
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Item 5.02
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Departure of Directors or Certain officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
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Item 7.01
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Regulation FD Disclosure
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Item 9.01
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Financial Statements and Exhibits
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10.1
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Non-Exec Director Agreement dated December 18, 2012
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99.1
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News Release dated December 18, 2012.
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/s/ Jordan Starkman
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Jordan Starkman
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President, Secretary, Treasurer and Director
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Date: December 18, 2012
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(a)
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the Non-Exec Director shall report directly to the Board of Directors of the Company;
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(b)
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the Non-Exec Director shall faithfully, honestly and diligently serve the Company and cooperate with the Company and utilize maximum professional skill and care to ensure that all services rendered hereunder, including the Services, are to the satisfaction of the Company, acting reasonably, and the Non-Exec Director shall provide any other services not specifically mentioned herein, but which by reason of the Non-Exec Director's capability the Non-Exec Director knows or ought to know to be necessary to ensure that the best interests of the Company are maintained; and
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(c)
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the Company shall report the results of the Non-Exec Director's duties hereunder as may be requested by the Company from time to time.
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(a)
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the Non-Exec Director breaches section 2.3 or 2.4 of this Agreement;
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(b)
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the Non-Exec Director breaches any other material term of this Agreement and such breach is not cured to the reasonable satisfaction of the Company within thirty (30) days after written notice describing the breach in reasonable detail is delivered to the Non-Exec Director;
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(c)
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the Company acting reasonably determines that the Non-Exec Director has acted, is acting or is likely to act in a manner detrimental to the Company or has violated or is likely to violate the confidentiality of any information as provided for in this Agreement;
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(d)
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the Non-Exec Director is unable or unwilling to perform the Services under this Agreement, or
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(e)
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the Non-Exec Director commits fraud, serious neglect or misconduct in the discharge of the Services.
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(a)
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a final accounting, reflecting the balance of expenses incurred on behalf of the Company as of the date of termination; and
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(b)
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all documents pertaining to the Company or this Agreement, including but not limited to, all books of account, correspondence and contracts in his possession, provided that the Non-Exec Director shall be entitled thereafter to inspect, examine and copy all of the documents which it delivers in accordance with this provision at all reasonable times upon three (3) days' notice to the Company.
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(a)
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is available to the public generally in the form disclosed;
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(b)
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becomes part of the public domain through no fault of the Non-Exec Director;
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(c)
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is already in the lawful possession of the Non-Exec Director at the time of receipt of the Confidential Information; or
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(d)
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is compelled by applicable law to be disclosed, provided that the Non-Exec Director gives the Company prompt written notice of such requirement prior to such disclosure and provides assistance in obtaining an order protecting the Confidential Information from public disclosure.
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(a)
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the Non-Exec Director agrees and acknowledges that none of the Compensation Options have been registered under the Securities Act of 1933 or under any state securities or "blue sky" laws of any state of the United States, and, unless so registered, may not be offered or sold in the United States or, directly or indirectly, to U.S. Persons (as that term is defined in Regulation S under the Securities Act of 1933), except in accordance with the provisions of Regulation S, pursuant to an effective registration statement under the Securities Act of 1933, or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act of 1933 and in each case only in accordance with applicable state securities laws. However, the parties acknowledge that the Company shall register the Compensation Options within one year from the date of this Agreement;
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(b)
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the Non-Exec Director has not acquired the Compensation Options as a result of, and will not itself engage in, any "directed selling efforts" (as defined in Regulation S under the 1933 Act) in the United States in respect of any of the Securities which would include any activities undertaken for the purpose of, or that could reasonably be expected to have the effect of, conditioning the market in the United States for the resale of any of the Compensation Options; provided, however, that the Non-Exec Director may sell or otherwise dispose of any of the Compensation Options pursuant to registration thereof under the 1933 Act and any applicable state securities laws or under an exemption from such registration requirements;
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(c)
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the Compensation Options will be subject in the United States to a hold period from the date of issuance of the Compensation Options unless such Compensation Options are registered with the Securities and Exchange Commission ("SEC");
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(d)
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the decision to execute this Agreement and purchase the Compensation Options agreed to be purchased hereunder has not been based upon any oral or written representation as to fact or otherwise made by or on behalf of the Company other than those made by the Company in the information the Company has filed with the SEC;
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(e)
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it will indemnify and hold harmless the Company and, where applicable, its directors, officers, employees, agents, advisors and shareholders from and against any and all loss, liability, claim, damage and expense whatsoever (including, but not limited to, any and all fees, costs and expenses whatsoever reasonably incurred in investigating, preparing or defending against any claim, lawsuit, administrative proceeding or investigation whether commenced or threatened) arising out of or based upon any representation or warranty of the Non-Exec Director contained herein or in any document furnished by the Non-Exec Director to the Company in connection herewith being untrue in any material respect or any breach or failure by the Non-Exec Director to comply with any covenant or agreement made by the Non-Exec Director to the Company in connection therewith;
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(f)
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the issuance and sale of the Compensation Options to the Non-Exec Director will not be completed if it would be unlawful;
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(g)
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the Compensation Options are not listed on any stock exchange or subject to quotation and no representation has been made to the Non-Exec Director that the Compensation Options will become listed on any other stock exchange or subject to quotation on any other quotation system except that market makers are currently making markets in the Company's common stock on the OTC Bulletin Board;
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(h)
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no securities commission or similar regulatory authority has reviewed or passed on the merits of the Compensation Options;
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(i)
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there is no government or other insurance covering the Compensation Options;
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(j)
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there are risks associated with an investment in the Compensation Options, including the risk that the Non-Exec Director could lose all of its investment;
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(k)
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the Non-Exec Director and the Non-Exec Director's advisor(s) have had a reasonable opportunity to ask questions of and receive answers from the Company in connection with the distribution of the Compensation Options hereunder, and to obtain additional information, to the extent possessed or obtainable without unreasonable effort or expense, necessary to verify the accuracy of the information about the Company;
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(l)
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the books and records of the Company were available upon reasonable notice for inspection, subject to certain confidentiality restrictions, by the Non-Exec Director during reasonable business hours at its principal place of business, and all documents, records and books in connection with the distribution of the Compensation Options hereunder have been made available for inspection by the Non-Exec Director, the Non-Exec Director's lawyer and/or advisor(s);
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(m)
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the Company will refuse to register any transfer of the Compensation Options not made in accordance with the provisions of Regulation S, pursuant to an effective registration statement under the 1933 Act or pursuant to an available exemption from the registration requirements of the 1933 Act;
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(n)
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the statutory and regulatory basis for the exemption claimed for the offer of the Compensation Options, although in technical compliance with Regulation S, would not be available if the offering is part of a plan or scheme to evade the registration provisions of the 1933 Act; and
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(o)
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the Non-Exec Director has been advised to consult the Non-Exec Director's own legal, tax and other advisors with respect to the merits and risks of an investment in the Compensation Options and with respect to applicable resale restrictions, and it is solely responsible (and the Company is not in any way responsible) for compliance with:
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(i)
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any applicable laws of the jurisdiction in which the Non-Exec Director is resident in connection with the distribution of the Compensation Options hereunder, and
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(ii)
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applicable resale restrictions.
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(a)
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The Non-Exec Director is not a US Person as that term is defined in Regulation S promulgated under the 1933 Act;
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(b)
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the sale of the Compensation Options to the Non-Exec Director as contemplated in this Agreement complies with or is exempt from the applicable securities legislation of the jurisdiction of residence of the Non-Exec Director;
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(c)
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the Non-Exec Director is acquiring the Compensation Options for investment only and not with a view to distribution and, in particular, it has no intention to distribute either directly or indirectly any of the Compensation Options in the United States or to U.S. Persons;
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(d)
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the Non-Exec Director is executing this Agreement and is acquiring the Compensation Options as principal for the Non-Exec Director's own account, for investment purposes only, and not with a view to, or for, distribution or fractionalisation thereof, in whole or in part, and no other person has a direct or indirect beneficial interest in such Compensation Options;
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(e)
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the entering into of this Agreement and the transactions contemplated hereby have been duly authorized by all necessary corporate action on the part of the Non-Exec Director;
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(f)
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the entering into of this Agreement and the transactions contemplated thereby will not result in the violation of any of the terms and provisions of any law applicable to the Non-Exec Director, or of any agreement, written or oral, to which the Non-Exec Director may be a party or by which the Non-Exec Director is or may be bound;
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(g)
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the Non-Exec Director has duly executed and delivered this Agreement and it constitutes a valid and binding agreement of the Non-Exec Director enforceable against the Non-Exec Director in accordance with its terms;
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(h)
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the Non-Exec Director has the requisite knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of the prospective investment in the Compensation Options and the Company;
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(i)
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the Non-Exec Director is not an underwriter of, or dealer in, the common shares of the Company, nor is the Non-Exec Director participating, pursuant to a contractual agreement or otherwise, in the distribution of the Compensation Options;
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(j)
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the Non-Exec Director is not aware of any advertisement of pertaining to the Company or any of the Compensation Options; and
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(k)
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no person has made to the Non-Exec Director any written or oral representations:
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(i)
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that any person will resell or repurchase any of the Compensation Options;
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(ii)
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that any person will refund the purchase price of any of the Compensation Options;
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(iii)
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as to the future price or value of any of the Compensation Options; or
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(iv)
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that any of the Compensation Options will be listed and posted for trading on any stock exchange or automated dealer quotation system or that application has been made to list and post any of the Compensation Options of the Company on any stock exchange or automated dealer quotation system, except that currently certain market makers make market in the common shares of the Company on the OTC Bulletin Board.
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(a)
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this Agreement was prepared for the Company;
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(b)
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the Non-Exec Director has been requested to obtain his own independent legal advice on this Agreement prior to signing this Agreement;
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(c)
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the Non-Exec Director has been given adequate time to obtain independent legal advice;
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(d)
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by signing this Agreement, the Non-Exec Director confirms that he fully understands this Agreement; and
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(e)
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by signing this Agreement without first obtaining independent legal advice, the Non-Exec Director waives his right to obtain independent legal advice.
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Per:
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/s/ Jordan Starkman | |
President
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/s/ Neil Carmichael | ||
NEIL CARMICHAEL |
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1.
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Terms and Conditions of Option
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2.
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Terms of Settlement
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(a)
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state that the Optionee elects to exercise the Option;
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(b)
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state the number of shares with respect to which the Option is being exercised (the “Optioned Shares”);
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(c)
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state the date upon which the Optionee desires to consummate the purchase of the Optioned Shares (which date must be prior to the termination of such Option and no later than 30 days from the delivery of such Notice); and
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(d)
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Payment of the Option Price for the Optioned Shares shall be made by delivery of cash, money order or a certified check to the order of the Company in an amount equal to the Option Price.
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3.
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Restricted Status of the Shares; Subsequent Dispositions.
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4.
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Representations and Warranties of Company
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(a)
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the Company has sufficient shares in treasury to satisfy its obligations under this Agreements and shall have such shares available for the entire Option Term;
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(b)
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the Company has the legal power and authority to execute and deliver this Agreement and all other documents required to be executed and delivered by the Company hereunder and to consummate the transactions contemplated hereby;
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(c)
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there are no investigations, actions, suits or proceedings, administrative or otherwise, threatened or pending to the knowledge of the Company that affect each Company’s rights to their respective Shares or the sale of their respective Shares;
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(d)
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the warranties and representations of the Company and the provisions hereof shall survive the date hereof, and the consummation of the transactions contemplated herein;
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(e)
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the Company shall indemnify, defend and hold harmless Optionee from and against all liabilities incurred by Optionee, directly or indirectly, including without limitation, all reasonable attorney’s fees and court costs, arising out of or in connection with the purchase of the Company’s Shares set forth in this Agreement, except where fraud, intent to defraud or default of payment evolves on the part of Optionee; and
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(f)
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such Company is not insolvent, is not in receivership, nor is any application for receivership pending; no proceedings are pending by or against it in bankruptcy or reorganization in any Provincial or Federal court, nor has it committed any act of bankruptcy.
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5.
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Private Placement of Options
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(a)
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The Optionee shall complete, sign and return to the Company as soon as possible, on request by the Company, such additional documents, notices and undertakings as may be required by regulatory authorities and applicable law.
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(b)
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The Optionee acknowledges and agrees that:
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i.
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the Optionee agrees and acknowledges that none of the Options have been registered under the Securities Act of 1933 or under any state securities or "blue sky" laws of any state of the United States, and, unless so registered, may not be offered or sold in the United States or, directly or indirectly, to U.S. Persons (as that term is defined in Regulation S under the Securities Act of 1933), except in accordance with the provisions of Regulation S, pursuant to an effective registration statement under the Securities Act of 1933, or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act of 1933 and in each case only in accordance with applicable state securities laws. However, the parties acknowledge that the Company shall register the Options within one year from the date of this Agreement;
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ii.
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the Optionee has not acquired the Options as a result of, and will not itself engage in, any "directed selling efforts" (as defined in Regulation S under the 1933 Act) in the United States in respect of any of the Securities which would include any activities undertaken for the purpose of, or that could reasonably be expected to have the effect of, conditioning the market in the United States for the resale of any of the Options; provided, however, that the Optionee may sell or otherwise dispose of any of the Options pursuant to registration thereof under the 1933 Act and any applicable state securities laws or under an exemption from such registration requirements;
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iii.
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the Options will be subject in the United States to a hold period from the date of issuance of the Options unless such Options are registered with the Securities and Exchange Commission ("SEC");
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iv.
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the decision to execute this Agreement and purchase the Options agreed to be purchased hereunder has not been based upon any oral or written representation as to fact or otherwise made by or on behalf of the Company other than those made by the Company in the information the Company has filed with the SEC;
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v.
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it will indemnify and hold harmless the Company and, where applicable, its directors, officers, employees, agents, advisors and shareholders from and against any and all loss, liability, claim, damage and expense whatsoever (including, but not limited to, any and all fees, costs and expenses whatsoever reasonably incurred in investigating, preparing or defending against any claim, lawsuit, administrative proceeding or investigation whether commenced or threatened) arising out of or based upon any representation or warranty of the Optionee contained herein or in any document furnished by the Optionee to the Company in connection herewith being untrue in any material respect or any breach or failure by the Optionee to comply with any covenant or agreement made by the Optionee to the Company in connection therewith;
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vi.
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the issuance and sale of the Options to the Optionee will not be completed if it would be unlawful;
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vii.
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the Options are not listed on any stock exchange or subject to quotation and no representation has been made to the Optionee that the Options will become listed on any other stock exchange or subject to quotation on any other quotation system except that market makers are currently making markets in the Company's common stock on the OTC Bulletin Board;
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viii.
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no securities commission or similar regulatory authority has reviewed or passed on the merits of the Options;
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ix.
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there is no government or other insurance covering the Options;
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x.
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there are risks associated with an investment in the Options, including the risk that the Optionee could lose all of its investment;
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xi.
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the Optionee and the Optionee's advisor(s) have had a reasonable opportunity to ask questions of and receive answers from the Company in connection with the distribution of the Options hereunder, and to obtain additional information, to the extent possessed or obtainable without unreasonable effort or expense, necessary to verify the accuracy of the information about the Company;
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xii.
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the books and records of the Company were available upon reasonable notice for inspection, subject to certain confidentiality restrictions, by the Optionee during reasonable business hours at its principal place of business, and all documents, records and books in connection with the distribution of the Options hereunder have been made available for inspection by the Optionee, the Optionee's lawyer and/or advisor(s);
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xiii.
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the Company will refuse to register any transfer of the Options not made in accordance with the provisions of Regulation S, pursuant to an effective registration statement under the 1933 Act or pursuant to an available exemption from the registration requirements of the 1933 Act;
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xiv.
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the statutory and regulatory basis for the exemption claimed for the offer of the Options, although in technical compliance with Regulation S, would not be available if the offering is part of a plan or scheme to evade the registration provisions of the 1933 Act; and
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xv.
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the Optionee has been advised to consult the Optionee's own legal, tax and other advisors with respect to the merits and risks of an investment in the Options and with respect to applicable resale restrictions, and it is solely responsible (and the Company is not in any way responsible) for compliance with:
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xvi.
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any applicable laws of the jurisdiction in which the Optionee is resident in connection with the distribution of the Options hereunder, and
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xvii.
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applicable resale restrictions.
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(c)
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The Optionee hereby represents and warrants to and covenants with the Company (which representations, warranties and covenants shall survive the end of the expiry of the Term or early termination of this Agreement) that:
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i.
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the Optionee is not a U.S. Person;
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ii.
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the Optionee is not acquiring the Options for the account or benefit of, directly or indirectly, any other U.S. Person;
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iii.
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the sale of the Options to the Optionee as contemplated in this Agreement complies with or is exempt from the applicable securities legislation of the jurisdiction of residence of the Optionee;
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iv.
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the Optionee is acquiring the Options for investment only and not with a view to distribution and, in particular, it has no intention to distribute either directly or indirectly any of the Options in the United States or to U.S. Persons;
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v.
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the Optionee is executing this Agreement and is acquiring the Options as principal for the Optionee's own account, for investment purposes only, and not with a view to, or for, distribution or fractionalisation thereof, in whole or in part, and no other person has a direct or indirect beneficial interest in such Options;
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vi.
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the entering into of this Agreement and the transactions contemplated hereby have been duly authorized by all necessary corporate action on the part of the Optionee;
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vii.
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the entering into of this Agreement and the transactions contemplated thereby will not result in the violation of any of the terms and provisions of any law applicable to the Optionee, or of any agreement, written or oral, to which the Optionee may be a party or by which the Optionee is or may be bound;
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viii.
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the Optionee has duly executed and delivered this Agreement and it constitutes a valid and binding agreement of the Optionee enforceable against the Optionee in accordance with its terms;
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ix.
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the Optionee has the requisite knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of the prospective investment in the Options and the Company;
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x.
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the Optionee is not an underwriter of, or dealer in, the common shares of the Company, nor is the Optionee participating, pursuant to a contractual agreement or otherwise, in the distribution of the Options;
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xi.
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the Optionee is not aware of any advertisement of pertaining to the Company or any of the Options; and
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xii.
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no person has made to the Optionee any written or oral representations:
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1.
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that any person will resell or repurchase any of the Options;
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2.
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that any person will refund the purchase price of any of the Options;
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3.
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as to the future price or value of any of the Options; or
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4.
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that any of the Options will be listed and posted for trading on any stock exchange or automated dealer quotation system or that application has been made to list and post any of the Options of the Company on any stock exchange or automated dealer quotation system, except that currently certain market makers make market in the common shares of the Company on the OTC Bulletin Board.
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(d)
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The Optionee hereby acknowledges that upon the issuance of shares resulting from the Options, and until such time as the same is no longer required under the applicable securities laws and regulations, the certificates representing any of the shares resulting from the Options will bear a legend in substantially the following form:
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6.
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Entire Agreement.
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7.
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Legal Agreement.
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8.
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Further Acts.
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9.
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Survival
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10.
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Notice
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11.
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Assignment and Termination
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12.
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Counterparts
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Per:
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/s/ Jordan Starkman | |
Authorized Signatory
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NEIL CARMICHAEL
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/s/ Neil Carmichael |