THIS INVESTMENT AGREEMENT ["Agreement"] is made effective as of the 20th
day of January 1999, by and between Xxxxxxx X. Xxxxxx, Glacier Medical LLC, a
wholly-owned subsidiary of Glacier Quest Inc. and Images of Life, Inc.
[hereinafter "IMLF"] a Nevada corporation.
RECITALS
1. Xxxxxxx X. Xxxxxx, is the sole owner of Glacier Medical LLC. Xxxxxxx X.
Xxxxxx owns the patent rights to certain medical safety devices which he
has developed specifically to protect health-care workers against
accidental needle sticks caused by hypodermic needles, infusion needles
and other products used in the administration of intravenous injections
[see Exhibit "A" attached].
2. Xxxxxxx X. Xxxxxx hereby agrees to assign all rights to the aforementioned
patents and any future patents arising as a direct result of the engineering
and research resulting from the development of the medical safety device
concept.
3. Glacier Medical wishes to obtain venture capital to finance the
development and initial production costs for the medical safety devices
and sufficient working capital to support Glacier Medical during this
development phase.
4. Glacier Medical and IMLF desire to enter into an Agreement under which
IMLF is granted, i) the opportunity to earn a thirty five percent [ 35%]
interest in Glacier Medical and ii) the exclusive right to market in Canada
any and all products developed by Glacier Medical, in return for providing
venture capital funding for the development of the Protect a Pal product
and any variation thereof.
5. Xxxxxx and Glacier Medical hereby represents and warrants that the
patents and patent applications are in good standing and they have not
previously conveyed or encumbered their interest in the patents. Xxxxxx
and Glacier Medical represent that all payments regarding the patents are
current and all obligations due to be performed by Xxxxxx and Glacier
Medical have been performed. They further represent that it has the full
right, power, and capacity to enter into this Agreement upon the terms and
conditions herein contained.
6. IMLF hereby represents and warrants that it is a Nevada corporation
engaged in investment in emerging technologies and products and the
marketing of those technologies and products. It further presents and
warrants that it has a full right, power, and capacity to enter into this
Agreement upon the terms and conditions herein contained.
NOW, THEREFORE, in consideration of IMLF's payment [ "good faith payment"]
to Glacier Medical of ten thousand dollars [$10,000] , the receipt and adequacy
of which are hereby acknowledged by Glacier or Medical, and other mutual
promises and covenants set forth in this agreement, Glacier Medical and IMLF
hereby agree as follows:
1. GRANT OF INTEREST
Xxxxxx and Glacier Medical hereby grant IMLF the option to acquire a 35%
interest in Glacier Medical for the sum of one million dollars [$1,000,000].
These funds are to be used for the development, testing, evaluation,
application for and securing of patents and FDA approval of the Protect Pal
product including its initial manufacturing costs and general corporate
overhead as defined in the operating budget for stage one and stage two
development [Exhibit "B" attached]. This includes any related products for the
medical industry developed as the direct result of the engineering and
research resulting from the development of the Protect a Pal concept.
2. RIGHTS TO THE CANADIAN MARKET
On receipt of the good faith payment of Xxxxxx hereby grants to IMLF the
exclusive right to the sale and distribution Glacier Medical's products in
Canada. This includes the Protect a Pal product and all products that may be
developed incidental to and in conjunction with the design, engineering,
market evaluation, development and testing of the Protect a Pal product.
On receipt of FDA approval Glacier Medical and IMLF shall enter into an
exclusive marketing agreement defining the rights and responsibilities of each
respective party with respect to the Canadian market. The Canadian market
by definition will include all sales in Canada, all sales by made by Canadian
entities to third parties offshore under aid programs or financed by
International Financial Institutions [ IFI ] including but not limited to the
World Bank, the World Health Organization or the United Nations.
The price that IMLF will pay Glacier Medical for to its products will not to
exceed one hundred and twenty [120%] of cost plus applicable shipping and
handling charges.
The term of this marketing agreement shall be for the life of the patents as
defined by the laws of the United States.
3. INVESTMENT SCHEDULE
IMLF interest in Glacier Medical will be earned based on the amount invested
and is based upon a vesting plan staged to reflect risk. Stage 1 investments
total five hundred thousand dollars [$500,000] and represents twenty five
percent [25%] interest in Glacier Medical. This sum will be paid to Glacier
incrementally, in monthly payments of twenty five thousand dollars [$25,000].
Each such payment will represent a 1.25% interest in Glacier Medical.
Investments shall be made monthly and where possible in a sum not less
than $25,000.
In any such case where by IMLF requests an extension time in which to make
the payment or deferment of such payment for good cause, then Glacier
Medical shall grant such extension of time or deferment upon receipt of a
written request. Such requests will be granted provided IMLF is no more than
four payments in arrears. If arrears exceed four scheduled payments, each
request shall be considered by Glacier Medical on a case by case basis and
Glacier Medical will have the option of granting such request or terminating
the contract in accordance with 6B below.
IMLF may make payments in any amount exceeding the $25,000 monthly
amount at any time and in any amount as may be deemed necessary by
IMLF. In such case were an incremental investment exceeds the $25,000
monthly payment, such additional funding will be made in blocks of $5,000
[unit], and each unit will represent 0.25% interest earned in Glacier Medical.
Stage 2 investments will total five hundred thousand dollars [$500,000] and
represents an additional ten percent [10%] interest in Glacier Medical. This
sum will be paid to Glacier incrementally, in monthly payments of one
hundred thousand dollars [$100,000]. Each such payment will represent a
2.00% interest in Glacier Medical.
On receipt of payment of each unit, the equity interest represented by that
unit, is deemed to have been earned. Any interest earned by IMLF is not
subject to dilution prior to Glacier Medical going public.
Stage 1 of the investment will begin January 1999 and reach completion upon
when the investment reaches a cumulative total of five hundred thousand
dollars [$500,000]. Stage 2 of the investment will begin no later than 90 days
after the completion of Stage 1.
4. OPERATING MANAGEMENT
Mr. Xxxxxxx Xxxxxx or his designate shall act as project manager overseeing
the development of the Protect a Pal product and any related ventures. IMLF
will provide technical and managerial assistance and monitor project
development on a regular basis. Xxxxxx will provide operating budgets, work
plans, and regular progress reports. Xxxxxx shall be the sole judge of how to
conduct the development and production of Glacier's products. Glacier may
choose to conduct its marketing in a different fashion than that contemplated
by IMLF in Canada. However, IMLF reserves are right to "piggyback" any
marketing arrangements made by Glacier Medical with international sales and
distribution companies specializing in the medical field for its exclusive
use in the Canadian market.
A management committee shall be formed consisting of one representative
from Glacier Medical and one representative from IMLF. The management
committee shall be responsible for policy decisions that effect product
development or production and shall approve all work plans and budgets
submitted by the operator. So far as possible, all disputes for differences
within the management committee shall be settled by discussion and mutual
agreement. Failing such, each party's representative shall vote that party's
percentage interest, a majority interest prevailing.
5. IMAGES OF LIFE'S INSPECTION RIGHTS
IMLF and its authorized agents and representatives shall have the right at all
reasonable business hours to inspect without interfering with Glacier
Medical's operations Glacier's accounts, all engineering design data and
marketing data, and the premises of all Glacier's contractors and their files
relating to work done for Glacier. Such inspections shall be at by IMLF's sole
risk and expense and IMLF shall hold Glacier harmless from any claims,
demands, liabilities or costs [including attorneys fees] by such agents or
representatives unless such claims, demands, liabilities or costs were caused
by Glacier's employees or contractors.
6. TERMINATION
A. By IMLF
IMLF may terminate this agreement at any time by delivery of written notice to
Glacier Medical, provided that:
i) IMLF shall pay any amounts becoming due within 30 days
following termination of this agreement under this contract;
ii) IMLF shall not be relieved amending obligations accrued
hereunder as of the date of mailing the termination notice;
iii) IMLF shall not be entitled to a refund of any payments for
expenditures made prior to termination;
iv) IMLF shall retain any interest earned as defined in Articles 2 & 3
herein.
v) Glacier Medical shall within or reasonable time after termination
execute and deliver to IMLF a statement of the percentage of
earned interest to be held by IMLF and a waiver of any
additional rights in Glacier Medical, which IMLF shall sign and
return within 30 days.
B) By Glacier Medical
If IMLF has failed in the performance of any obligations hereunder, this
agreement shall not automatically terminate, but rather, Glacier Medical shall
have the right and obligation to notify IMLF of such failure and demand that
the failure be cured. IMLF shall have 30 days from the date of receipt of such
notice in which to cure the failure. If IMLF fails to cure the failure, then
this agreement shall be terminated. In the event of termination IMLF
shall not be entitled to or refund of any payment or expenditures but
shall retain any interest earned as defined in Articles 2 & 3 herein.
7. ARBITRATION
In the event of any dispute arising between the parties to this agreement to
such disputes shall be resolved first by mutual discussion and agreement
failing such they shall be settled in accordance with the rules of the American
arbitration association conform to the laws of the state of Arizona.
8. ASSIGNMENT
IMLF shall have the unrestricted right to assign or sell its rights,
obligations and interests under this agreement to any subsidiary, affiliate
or third party.
9. FORCE MAJEURE
The time period for a performance under this agreement shall be extended by
any time or times that a party is prevented from such performance by factors
beyond its control including, but not limited to, acts of God shortage of
supplies or labor, acts of governmental bodies, including delays in obtaining
permits. The party declaring a condition of force majeure shall give the other
party written notice of the start and cessation of each period of point force
majeure. The party giving notice shall use its best efforts to remove any
event of force majeure.
10. CONFIDENTIALITY
IMLF shall treat all data, reports, records, and other information relating to
product development and design as confidential. This provision shall not
prevent by IMLF from disclosing information otherwise confidential to potential
assignees or buyers, investment consultants such assignees, buyers, or
consultants agree in writing to keep such information confidential to nor shall
it prevent IMLF for making a timely disclosure as may be required from time
to time by regulatory bodies having jurisdiction thereover, nor for making
public announcements, provided that IMLF shall provide to Glacier Medical
copies of the information to be released within a reasonable time, prior to the
release.
11. GOVERNING LAW
The law governing this contract shall be the laws of the state of Arizona.
12. NOTICE
Notices hereunder shall be in writing and delivered by prepaid certified,
registered mail, or independent courier service with a return receipt
requested effective when mail and addressed as follows:
Images of Life, Inc. Images of Life Inc.
00000 Xxxx Xxxxx Xxx
Xxxxxx, Xxxxxxx
00000
Glacier Medical LLC Glacier Medical LLC
00000 Xxxxx Xxxx Xxxxx
Xxxxx 000
Xxxxx XX
00000
WHEREFORE, the parties have executed this agreement and as of the date first
above written,
For Images of Life Inc. for Glacier Medical LLC,
Original Signed by: Original Signed by:
"J. R. Xxxxxx" "Xxxxxxx X. Xxxxxx"
J. R. Xxxxxx, President Xxxxxxx X. Xxxxxx, President
EXHIBIT 6.1 - 10SB
INVESTMENT AGREEMENT
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